Section 240.14a-101 Schedule 14A.
Information required in proxy statement.
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 Section 240.14a-11(c) or Section
240.14a-12
Oneida Ltd.
..................................................................
(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:
............................................................
(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.:
.......................................................
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.......................................................
(4) Date Filed:
.......................................................
[ONEIDA LOGO]
PETER J. KALLET
Chairman of the Board,
President and
Chief Executive Officer
April 25, 2003
TO OUR STOCKHOLDERS:
You are cordially invited to attend ONEIDA LTD.'S 122nd Annual Meeting on
May 28, 2003.
Details regarding time and place as well as the matters which will be
considered at the meeting are described in the accompanying Notice and Proxy
Statement.
We hope that you can attend. However, whether or not you plan to attend,
please sign and date the enclosed proxy card and return it promptly in the
postpaid envelope we have provided. This will enable you to vote on the business
to be transacted, whether or not you attend the meeting.
Sincerely,
PETER J. KALLET
ONEIDA LTD.
-------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 28, 2003
-------------------
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of ONEIDA LTD.
will be held in the Big Hall of the Mansion House at Kenwood in the City of
Oneida, New York, on May 28, 2003 at 2 p.m. for the following purposes:
(a) to elect three directors for a three-year term and until their
respective successors shall be elected and qualify;
(b) to consider and vote upon a proposal to approve the Oneida Ltd. 2003
Non-Employee Directors Stock Option Plan;
(c) to ratify the appointment of PricewaterhouseCoopers LLP as independent
auditors for the fiscal year ending January 31, 2004; and
(d) to transact such other business as may properly come before the meeting
or any adjournment of it.
Only holders of Common Stock of record at the close of business on
April 14, 2003 are entitled to notice of or to vote at the meeting.
By Order of the Board of Directors
CATHERINE H. SUTTMEIER
CATHERINE H. SUTTMEIER
Secretary
Oneida, New York
April 25, 2003
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE SO YOUR STOCK CAN
BE VOTED IN ACCORDANCE WITH THE TERMS OF THE PROXY STATEMENT.
ONEIDA LTD.
ONEIDA, NEW YORK 13421
--------------------------
PROXY STATEMENT
--------------------------
The solicitation of the enclosed proxy is made by the Board of Directors of
Oneida Ltd. (the 'Corporation'), which will bear the cost of the solicitation.
Regular employees of the Corporation may solicit proxies personally or by mail
or telephone. Expenses, including out-of-pocket expenses and charges which may
be incurred or made by nominees or custodians solicited in obtaining
authorization from their principals to execute proxies, will be borne by the
Corporation. The Corporation has retained Georgeson Shareholder Communications,
Inc. to assist in the solicitation of proxies from banks, brokers and nominees
for an estimated fee of $5,000, plus other costs and expenses.
Distribution of this Proxy Statement and related proxy soliciting materials
to stockholders is scheduled to begin on or about May 5, 2003.
Only holders of record of the Common Stock of the Corporation as of the
close of business on April 14, 2003 are entitled to vote at the Annual Meeting.
As of that date, there were outstanding 16,610,971 shares of Common Stock. Each
share is entitled to one vote. The presence, in person or by proxy, of the
holders of a majority of the outstanding shares entitled to vote is necessary
for a quorum at the Annual Meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table lists the only stockholders known to the Corporation to
be beneficial owners of more than five percent of the Corporation's Common Stock
as of December 31, 2002.
PERCENTAGE OF
TOTAL NUMBER OF
NAME AND ADDRESS NUMBER OF OUTSTANDING
OF BENEFICIAL OWNERS SHARES OWNED SHARES
-------------------- ------------ ------
Ariel Capital Management, Inc. .................. 3,231,422 19.53%
200 E. Randolph Drive, Suite 2900
Chicago, IL 60601(1)
Fidelity Management Trust Company ............... 2,045,781 12.36%
Trustee for the Benefit of the Oneida Ltd.
Employee Stock Ownership Plan
82 Devonshire Street
Boston, MA 02109(2)
National Rural Electric Cooperative
Association ................................... 1,062,840 6.42%
4301 Wilson Boulevard
Arlington, VA 22203(3)
Dalton, Greiner, Hartman, Maher & Co. .......... 960,165 5.8%
565 Fifth Avenue, Suite 2101
New York, NY 10017(4)
---------
(1) The Corporation has received a copy of a Schedule 13G filed with the
Securities and Exchange Commission by Ariel Capital Management, Inc.
reporting beneficial ownership. This stockholder is described in the
Schedule as 'an investment adviser registered under section 203 of the
Investment Advisers Act of 1940.'
(2) On June 8, 1987, the Corporation established an Employee Stock Ownership
Plan for the benefit of its Oneida Ltd. employees. The individual employee
participants have sole voting power for the shares. The Corporation is the
named fiduciary and administrator of the plan, and a committee appointed by
the Board of Directors has sole dispositive power with regard to the shares,
except that the individual employee participants have dispositive powers
with regard to the shares in the event of a tender offer or any other offer
or option to buy or exchange a significant number of shares in the trust.
Fidelty Management Trust Company, as trustee for the plan, has no
discretionary power over the shares.
(footnotes continued on next page)
(footnotes continued from previous page)
(3) The Corporation has received a copy of a Schedule 13G filed with the
Securities and Exchange Commission by National Rural Electric Cooperative
Association reporting beneficial ownership. This stockholder is described in
the Schedule as an 'Employee Benefit Plan, Pension Fund which is subject to
the provisions of the Employee Retirement Income Security Act of 1974, or
Endowment Fund.'
(4) The Corporation has received a copy of a Schedule 13G filed with the
Securities and Exchange Commission by Dalton, Greiner, Hartman, Maher & Co.
reporting beneficial ownership. This stockholder is described in the
Schedule as 'an investment advisor registered under Section 203 of the
Investment Advisors Act of 1940'.
ACTION TO BE TAKEN UNDER THE PROXY
Unless the giver of the proxy directs otherwise, the shares represented by
the accompanying proxy will be voted (a) for the election of three directors for
a three-year term; (b) for the proposal to approve the Oneida Ltd. 2003
Non-Employee Directors Stock Option Plan; and (c) to ratify the appointment of
PricewaterhouseCoopers LLP as independent auditors. In each case where the giver
of a proxy has directed that the proxy be voted otherwise, it will be voted
according to the direction given. As to any other business which properly comes
before the meeting or any adjournment of it, the persons acting under the proxy
intend to vote according to their judgment. Management is not aware of any such
other matters of business.
REVOCATION OF PROXY
Anyone who gives a proxy may still vote in person. The giver may revoke the
proxy at any time before it has been exercised. In this event, written notice of
revocation should be filed with the Secretary of the Corporation.
SIGNATURES ON PROXIES IN CERTAIN CASES
If stock is registered in the name of two or more trustees or other persons,
the proxy should be signed by each of them. If stock is registered in the name
of a decedent, the proxy should be signed by an executor or administrator, whose
title should follow the signature. If a stockholder is a corporation, the
enclosed proxy should be signed by an executive officer, whose title should be
indicated.
ELECTION OF DIRECTORS
NOMINEES FOR DIRECTORS
The Corporation's Board of Directors is divided into two classes of four
directors and one class of three directors serving staggered three-year terms.
At the 2003 Annual Meeting, stockholders are being asked to elect three
directors, each for a three-year term expiring at the 2006 Annual Meeting. An
affirmative vote of the majority of stockholders present in person or by proxy
is necessary for the election of these directors.
Two nominees, Georgia S. Derrico and Peter J. Kallet, are members of the
present Board of Directors and each was elected to a three-year term in 2000. In
August 2002 the Board of Directors voted to increase the size of the Board from
ten to eleven members by adding an additional seat to the class of directors
whose terms expire on May 28, 2003. Peter J. Marshall was elected by the Board
to fill that position. Mr. Marshall is now nominated to be elected for a full
three-year term. R. Quintus Anderson, who was elected to a three-year term in
2000, is retiring at the expiration of his present term. In March 2003, the
Board of Directors voted to decrease the size of the Board from eleven to ten
members effective May 28, 2003, the date of Mr. Anderson's retirement from the
Board.
Each nominee has consented to being named in this Proxy Statement and to
serve if elected. The Management has no reason to believe that any of the
nominees will be unable or unwilling to serve. Should any nominee named in the
table become unable or unwilling to accept nomination or election as a director,
the persons acting under the proxy intend to vote for the election in his or her
stead of such other person as the Management may recommend.
2
NOMINEES FOR THREE-YEAR TERMS EXPIRING MAY 31, 2006
GEORGIA S. DERRICO (b) (c) (d) (e) ......................... Chairman of the Board and Chief
Director since 1982, Age 58 Executive Officer, Southern
Financial Bancorp, Inc.
Ms. Derrico has held the above position for more than the past five years.
PETER J. MARSHALL (b) (c) (e) .............................. Vice President and Chief Finance
Director since August 2002, Age 49 Officer, Dover Technologies
International, Inc.
Mr. Marshall has been Vice President and Chief Finance Officer of Dover Technologies International,
Inc. since 1998. He was previously Audit Partner in the Syracuse, New York office of Coopers &
Lybrand, LLP.
PETER J. KALLET (a) (g) .................................... Chairman of the Board, President and
Director since 1996, Age 56 Chief Executive Officer
Mr. Kallet was elected Chairman of the Board in May, 2000 and Chief Executive Officer in December,
1998. He has served as President for more than the past five years.
DIRECTORS CONTINUING IN OFFICE WHOSE TERMS EXPIRE MAY 26, 2004
WILLIAM F. ALLYN (b) (c) (d) (e) ........................... Chairman and Chief Executive Officer,
Director since 1989, Age 67 Welch Allyn Ventures, LLC
In 2000 Mr. Allyn was appointed to this position and he retired as President of Welch Allyn, Inc.,
a position he held for more than five years. Mr. Allyn is a director of M&T Bank.
ALLAN H. CONSEUR (a) ....................................... Executive Vice President
Director since 2001, Age 54
Mr. Conseur was elected Executive Vice President in 1999. He has been President, THC Systems, Inc.
and President, Oneida International, Inc. for more than the past five years.
GREGORY M. HARDEN (a) (b) (c) (e) .......................... President and
Director since 1998, Age 46 Chief Executive Officer,
Harden Furniture Co., Inc.
Mr. Harden has held the above position for more than the past five years. Mr. Harden is a director
of Daniel Green Co., Inc. and Utica Mutual Insurance Co.
CATHERINE H. SUTTMEIER (a) ................................. Corporate Vice President,
Director since 1998, Age 46 Secretary and General Counsel
Ms. Suttmeier was elected Corporate Vice President in 1999. She has been Vice President, Secretary
and General Counsel for more than the past five years.
DIRECTORS CONTINUING IN OFFICE WHOSE TERMS EXPIRE MAY 25, 2005
J. PETER FOBARE (a) ........................................ Senior Vice President and
Director since 1998, Age 53 General Manager, Oneida Consumer
Retail and Direct Divisions
Mr. Fobare assumed responsibility for the Consumer Direct Division in 1999. He has been Senior Vice
President and General Manager of the Consumer Retail Division for more than the past five years.
WHITNEY D. PIDOT (d) (f) ................................... Partner and Member of Executive
Director since 1996, Age 59 Group, Shearman & Sterling,
Attorneys, New York
Mr. Pidot has been a partner with Shearman & Sterling for more than the past five years.
WILLIAM M. TUCK (b) (c) (d) (e) ............................ Former President, Crouse-Hinds
Director since 1996, Age 67 Division of Cooper
Industries, Inc.
Mr. Tuck retired as President of Crouse-Hinds in 1998.
---------
(a) Member of the Executive Committee.
(b) Member of the Audit Committee.
(c) Member of the Management Development and Executive Compensation Committee.
(footnotes continued on next page)
3
(footnotes continued from previous page)
(d) Member of the Nominating Committee.
(e) Member of Pension and Profit Sharing Fund Investment Committee.
(f) Mr. Pidot attends the meetings of the Audit Committee, the Management
Development and Executive Compensation Committee and the Pension and Profit
Sharing Fund Investment Committee as counsel by invitation.
(g) Ex Officio member of the Nominating Committee.
SECURITY OWNERSHIP OF MANAGEMENT
The following table lists the Corporation's Common Stock beneficially owned
by the management and directors of the Corporation as of March 14, 2003:
NUMBER OF
NAME OF BENEFICIAL OWNER SHARES OWNED
------------------------ ------------
William F. Allyn............................................ 11,581(1)
Allan H. Conseur............................................ 58,741(2)(3)
Georgia S. Derrico.......................................... 29,644(1)
J. Peter Fobare............................................. 83,450(2)(3)
Gregory M. Harden........................................... 49,319(1)
Peter J. Kallet............................................. 156,327(2)(3)
Peter J. Marshall........................................... 400
Robert L. Lupica............................................ 40,196(2)(3)
Whitney D. Pidot............................................ 15,787(1)
Catherine H. Suttmeier...................................... 59,504(2)(3)
William M. Tuck............................................. 10,380(1)
Nominees for director and directors and officers as a
group..................................................... 650,678(1)(2)(3)
The nominees and directors and officers as a group own 3.9%(1)(2)(3)
---------
(1) Includes 5,000 shares which as of March 14, 2003 could be acquired within 60
days upon the exercise of options under the 1998 Non-Employee Directors
Stock Option Plan, as amended.
(2) Includes shares which as of March 14, 2003 could be acquired within 60 days
upon the exercise of options under the Oneida Ltd. 1987, 1998 and 2002 Stock
Option Plans and the Oneida Ltd. Employee Stock Purchase Plan in the
following amounts: A. Conseur -- 47,021; J.P. Fobare -- 53,772;
P. Kallet -- 99,669; R. Lupica -- 38,223; C. Suttmeier -- 47,977; and other
Executive Officers as a group -- 115,531.
(3) Includes shares held indirectly through the Corporation's Employee Stock
Ownership Plan in the following amounts as of March 14, 2003:
A. Conseur -- 403; J. P. Fobare -- 6,939; P. Kallet -- 11,140;
R. Lupica -- 141; C. Suttmeier -- 4,427; and other Executive Officers as a
group -- 19,818.
MEETINGS OF THE BOARD OF DIRECTORS AND STANDING COMMITTEES
During the past fiscal year, the Board of Directors held nine meetings. All
directors attended more than seventy-five percent of the total number of
meetings of the Board of Directors and of the standing committees on which they
served, held during the period for which such director has been a member.
Certain directors designated in the Election of Directors section are members of
the following standing committees:
Audit Committee. During the past fiscal year, the committee met on five
occasions. None of the members of the committee is an officer or an employee of
the Corporation. The committee reviews and makes recommendations to the Board of
Directors with respect to the independent auditors' management letter and
reviews the accounting systems and controls of the Corporation on a continuing
basis.
Management Development and Executive Compensation Committee. During the past
fiscal year, the committee met on three occasions. None of the members of the
committee is an officer or an employee of the Corporation. The committee reviews
and establishes the salaries of the officers who are compensated at an
4
annual basic rate of $150,000 or more. The committee also makes recommendations
to the Board of Directors with respect to the organization, management and
personnel of the Corporation and has responsibility for administering the
Corporation's stock option plans, restricted stock awards, deferred compensation
and incentive compensation plans.
Nominating Committee. The Nominating Committee, formed in December 2002,
held its first meeting on March 28, 2003. The committee has responsibility for
recommending to the Board of Directors: (i) an annual slate of directors to be
elected at the Annual Meeting of Shareholders, (ii) as needed, candidates to
fill vacancies on the Board, and (iii) compensation to be paid to non-employee
Directors.
Pension and Profit Sharing Fund Investment Committee. During the past fiscal
year, the Pension and Profit Sharing Investment Committee held one meeting. The
committee makes recommendations to the Board of Directors with respect to the
investment of funds held in the pension and profit sharing plans of the
Corporation and its subsidiaries.
DIRECTORS' COMPENSATION
Directors who are not employees of the Corporation receive $19,000 on an
annual basis for serving as directors of the Corporation. They also receive
$1,250 per Board meeting, $750 each for the first two committee meetings held on
the day of regular Board meetings, $400 for the third committee meeting held on
the day of regular Board meetings and $750 for special committee meetings not
held on the day of regular Board meetings. Committee chairpersons receive an
additional $50 per committee meeting.
Under the Oneida Ltd. 2000 Non-Employee Directors' Equity Plan, each
non-employee director may elect to receive all or a portion of his or her annual
retainer in Common Stock of the Corporation. The total number of shares is
determined by dividing the portion of the annual retainer that the director has
elected to receive in Common Stock by the average closing price of the stock for
the five day period immediately preceding the Board of Directors meeting at
which annual retainers are paid. This year five of the seven non-employee
directors elected to receive a portion of his or her annual retainer in Common
Stock. Pursuant to these elections, non-employee directors received the
following shares pursuant to the Plan: William F. Allyn -- 853; Georgia S.
Derrico -- 1,000; Peter J. Marshall -- 400; Whitney D. Pidot -- 1,707; and
William M. Tuck -- 1,000.
Pursuant to the 1998 Non-Employee Directors Stock Option Plan, as amended,
each newly elected and continuing non-employee member of the Board of Directors
is granted an annual option to purchase 1,000 shares of the Corporation's Common
Stock. All director options have a per share exercise price equal to the fair
market value of the shares on the date of grant. Director options automatically
vest and become exercisable twelve months from date of grant. All director
options expire ten years from date of grant.
Retiring non-employee directors who serve ten years or more on the Board
continue to receive their retainer for ten years following their retirement.
Non-employee directors who retire with five to ten years of service receive 50%
of their annual retainer for the ten-year period after retirement.
5
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table shows for the past three fiscal years the cash
compensation paid by the Corporation and its subsidiaries, as well as certain
other compensation paid or accrued, to the Corporation's Chief Executive Officer
and each of the Corporation's four other most highly compensated executive
officers.
LONG TERM COMPENSATION
---------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------------------------------------- ---------- --------------------
NAME AND RESTRICTED
PRINCIPAL FISCAL YEAR CASH STOCK OTHER ANNUAL STOCK OPTIONS LTIP
POSITION ENDED SALARY INCENTIVE INCENTIVE COMPENSATION AWARDS(1) # PAYOUTS(2)
-------- ----- ------ --------- --------- ------------ --------- ------- ----------
Peter J. Kallet, 2003 $340,614 $ 0 $0 $0 $ 0 50,000 $0
Chairman of the 2002 354,000 0 0 0 0 50,000 0
Board, President and 2001 340,000 159,100 0 0 62,604 50,000 0
CEO
Allan H. Conseur, 2003 363,322 0 0 0 0 25,000 0
Executive 2002 377,600 0 0 0 0 20,000 0
Vice President 2001 374,000 160,875 0 0 0 25,000 0
J. Peter Fobare 2003 188,284 0 0 0 0 15,000 0
Senior Vice 2002 195,683 0 0 0 0 15,000 0
President 2001 189,372 67,925 0 0 0 15,000 0
and General Manager,
Consumer Retail
and Direct Divisions
Robert L. Lupica 2003 160,845 0 0 0 0 10,000 0
Senior Vice 2002 167,167 0 0 0 0 10,000 0
President and 2001 170,000 67,925 0 0 0 20,000 0
General Manager,
Buffalo Operations
Catherine H. 2003 158,006 0 0 0 0 20,000 0
Suttmeier 2002 164,217 0 0 0 0 15,000 0
Corporate Vice 2001 152,400 75,075 0 0 0 20,000 0
President, Secretary
and General Counsel
NAME AND
PRINCIPAL ALL OTHER
POSITION COMPENSATION(3)
-------- ---------------
Peter J. Kallet, $ 0
Chairman of the 0
Board, President and 3,799
CEO
Allan H. Conseur, 0
Executive 0
Vice President 1,758
J. Peter Fobare 0
Senior Vice 0
President 3,503
and General Manager,
Consumer Retail
and Direct Divisions
Robert L. Lupica 0
Senior Vice 0
President and 1,580
General Manager,
Buffalo Operations
Catherine H. 0
Suttmeier 0
Corporate Vice 2,590
President, Secretary
and General Counsel
---------
(1) In fiscal year ended 2001, Mr. Kallet was awarded 3,384 shares of common
stock under the Corporation's Amended and Restated Restricted Stock Award
Plan, pursuant to the performance-based incentive plan for the chief
executive officer which is described on page 11, below.
(2) LTIP: Long-Term Incentive Payments.
(3) This category includes allocation of shares to the executives' accounts
under the Oneida Ltd. Employee Stock Ownership Plan, a defined contribution
retirement plan, for fiscal year ended 2001 in the following amounts:
P. Kallet -- 207; A. Conseur -- 92; J. P. Fobare -- 189; R. Lupica -- 82;
and C. Suttmeier -- 146. Shares are valued at the market price on the dates
of allocations. There were no Employee Stock Ownership Plan contributions
for fiscal years ended 2002 or 2003. This category also includes the
Corporation's matching contributions to the executives' 401(k) savings
accounts. The Corporation's contributions for Messrs. Kallet, Conseur,
Fobare and Lupica and Ms. Suttmeier for fiscal year ended 2001 was $125.
There were no 401(k) matching contributions for fiscal years ended 2002 or
2003.
STOCK OPTIONS
The following table contains information concerning the grant of stock
options under the Corporation's 1987, 1998 and 2002 Stock Option Plans to the
Corporation's Chief Executive Officer and each of the Corporation's four other
most highly compensated executive officers as of the end of the past fiscal
year.
6
OPTION GRANTS IN PAST FISCAL YEAR
INDIVIDUAL GRANTS
---------------------------------------------------------------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SHARES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM
OPTIONS EMPLOYEES IN OR BASE EXPIRATION -------------------------
NAME GRANTED(#) FISCAL YEAR PRICE ($/SH) DATE 5%($) 10%($)
---- ---------- ----------- ------------ ---- ----- ------
P. Kallet............ 50,000 14.6% $18.17 2012 $571,500 $1,448,000
A. Conseur........... 25,000 7.3 18.17 2012 285,750 724,000
J. P. Fobare......... 15,000 4.4 18.17 2012 171,450 434,400
R. Lupica............ 10,000 2.9 18.17 2012 114,300 289,600
C. Suttmeier......... 20,000 5.8 18.17 2012 228,600 579,200
NOTE: The 1987, 1998 and 2002 Stock Option Plans provide for grants of
Common Stock options to executive officers and key employees of the Corporation
and its subsidiaries. The exercise price for shares granted is the market value
of the shares on the date of the grant. The exercise price may be paid in cash;
from time to time payment has been allowed in other forms, including exchange of
Common Stock of the Corporation previously held by the executive. The vesting
schedule as well as the term during which an option may be exercised are
established at the time of the grant.
The following table sets forth information with respect to the named
executives concerning the exercise of options during the past fiscal year and
unexercised options held at the end of that fiscal year.
AGGREGATED OPTION EXERCISES IN PAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUE
NUMBER OF
SHARES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FY-END FY-END($)
SHARES --------------- ---------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABLE
---- ----------- ----------- ------------- -------------
P. Kallet........................ 0 0 126,200/179,800 $10,746/$0
A. Conseur....................... 0 0 33,400/85,850 0/ 0
J. P. Fobare..................... 0 0 46,709/56,900 27,057/ 0
R. Lupica........................ 0 0 31,275/42,900 0/ 0
C. Suttmeier..................... 0 0 40,013/68,900 17,997/ 0
PENSION PLAN TABLE
The following table shows estimated annual retirement benefits payable at
age 65 under the Retirement Plan for Employees of Oneida Ltd., a qualified
defined benefit plan.
FINAL AVERAGE
ANNUAL EARNINGS 10 YEARS 20 YEARS 30 YEARS 40 YEARS
--------------- -------- -------- -------- --------
$100,000.................................... $ 8,624 $17,248 $ 25,872 $ 34,496
120,000.................................... 10,524 21,048 31,572 42,096
150,000.................................... 13,374 26,748 40,122 53,496
200,000.................................... 18,124 36,248 54,372 72,496
250,000.................................... 22,874 45,748 68,622 91,496
300,000.................................... 27,624 55,248 82,872 110,496
350,000.................................... 32,374 64,748 97,122 129,496
400,000.................................... 37,124 74,248 111,372 148,496
500,000.................................... 46,624 93,248 139,872 186,496
600,000.................................... 56,124 112,248 168,372 224,496
700,000.................................... 65,624 131,248 196,872 262,496
800,000.................................... 75,124 150,248 225,372 300,496
7
Compensation covered by the Retirement Plan includes base salary and cash
incentives reported in the Summary Compensation Table. The normal retirement
benefit at age 65 is based on years of service and the average annual
compensation during the three highest paid consecutive calendar years from the
ten years of employment preceding retirement. Years of service for the purpose
of determining benefits for the named executives are P. Kallet -- 34 years, A.
Conseur -- 6 years; J. P. Fobare -- 29 years, R. Lupica -- 3 years; and C.
Suttmeier -- 20 years.
The Internal Revenue Code and the Employee Retirement Income Security Act of
1974 limits the amount of benefit that can be paid under the plan to $160,000
and the maximum compensation that can be taken into account in establishing
benefits to $200,000.
In addition to the Retirement Plan for Employees of Oneida Ltd., the named
executives also participate in the Oneida Ltd. Employee Stock Ownership Plan, a
defined contribution plan. Benefits received under the Employee Stock Ownership
Plan are offset against the benefits to be received under the Retirement Plan.
Allocations to the executives' Employee Stock Ownership Plan accounts for the
past fiscal year are reported in the Summary Compensation Table.
In addition to the retirement benefits described above, the Corporation
maintains a Restoration Plan for key employees and officers selected by the
Compensation Committee. The Chief Executive Officer and the other named
executives are participants. The Restoration Plan guarantees (a) the benefit
under the Retirement Plan described above as if the limitations imposed by the
Internal Revenue Code did not apply, plus (b) an annual retirement allowance
equaling 50% for Mr. Kallet and 40% for other participants of their average
annual compensation, actuarially reduced if the participant retires before age
62, and offset by the participating officer's other retirement benefits,
including restoration benefits. The benefit is forfeited if the participant
retires or otherwise terminates employment before age 55. In December 2002, the
Board of Directors amended the Corporation's Retirement Plan to provide a
mechanism for the payment through the Retirement Plan of all or a portion of the
benefits due under the Restoration Plan to Mr. Kallet and certain other
executive officers of the Corporation, none of whom is among the Corporation's
four other most highly compensated executive officers for the past fiscal year.
CHANGE IN CONTROL AGREEMENTS
The Corporation has entered into Change in Control Agreements with the five
named executive officers dated November 15, 1999. The agreements, in general,
provide that in the event the officer's employment is terminated as a result of
a Change in Control, the officer will be entitled to a severance payment equal
to 2.99 times his or her average annual compensation (as defined), health
insurance for three years following termination and a supplemental pension
benefit.
These agreements define a 'Change in Control' as an event where (a) any
individual, partnership, firm, corporation, association, trust, unincorporated
organization or other entity or person, or any syndicate or group deemed to be a
person under Section 14(d)(2) of the Exchange Act is or becomes the 'beneficial
owner' (as defined in Rule 13d-3 of the General Rules and Regulations under the
Exchange Act), directly or indirectly, of securities of the Company representing
20% or more of the combined voting power of the Company's then outstanding
securities entitled to vote in the election of directors of the Company; (b)
during any period of two consecutive years (not including any period prior to
the effective date of this Agreement), individuals who at the beginning of such
periods constituted the Board and any new directors, whose election by the Board
or nomination for election by the Company's stockholders was approved by a vote
of at least three-fourths of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved, cease for any reason to constitute a
majority thereof; (c) there occurs a reorganization, merger, consolidation or
other corporate transaction involving the Company (a 'Business Combination'), in
each case with respect to which stockholders of the Company immediately prior to
such transaction do not, immediately after such transaction, own directly or
indirectly more than 50% of the combined voting power of the Company or other
corporation resulting from such Business Combination in substantially the same
proportions as their ownership, immediately prior to such Business Combination,
of the voting securities of the Company; (d) all or substantially all of the
assets of the Company are sold, liquidated or distributed; or (e) there occurs a
transaction that constitutes a change in the (i) ownership of the Company,
(ii) effective control of the Company or (iii) effective ownership of a
substantial portion of the assets of the Company, as determined pursuant to
Internal Revenue Code Section 280G and the regulations promulgated thereunder.
8
The agreements provide for a full tax gross up for all excise taxes incurred
under the 'golden parachute' rules of the Internal Revenue Code.
In 1989 the Board of Directors also approved an Employee Security Plan which
provides severance benefits for all eligible employees of the Corporation who
lose their jobs in the event of a Change in Control. Employees are eligible for
these benefits if they have one year or more of service. Executive officers who
are parties to the agreements described above are not eligible for Employee
Security Plan benefits.
EQUITY COMPENSATION PLANS
The following table Summarizes information about the Corporation's equity
compensation plans as of January 25, 2003. All outstanding awards relate to the
Corporation's common stock.
EQUITY COMPENSATION PLAN INFORMATION
(a) (b) (c)
-------------------- -------------------- ---------------------
NUMBER OF SECURITIES
REMAINING AVAILABLE
FOR ISSUANCE UNDER
NUMBER OF SECURITIES EQUITY
TO BE ISSUED UPON WEIGHTED-AVERAGE COMPENSATION PLANS
EXERCISE OF EXERCISE PRICE OF (EXCLUDING SECURITIES
OUTSTANDING OPTIONS, OUTSTANDING OPTIONS, REFLECTED IN
PLAN CATEGORY WARRANTS AND RIGHTS WARRANTS AND RIGHTS COLUMN (a))
------------- ------------------- ------------------- -----------
Equity Compensation Plans Approved by
Stockholders(1)...................... 1,778,814 $17.14 1,866,278(2)
Equity Compensation Plans Not Approved
by Stockholders(3)................... 0 0 0
Total.............................. 1,778,814 $17.14 1,866,278(2)
---------
(1) Includes the Employee Stock Purchase Plan, as amended, 1987 Stock Option
Plan, 1998 Stock Option Plan, 2002 Stock Option Plan, 1998 Non-Employee
Directors Stock Option Plan, as amended, 2000 Non-Employee Directors Equity
Plan and Amended and Restated Restricted Stock Award Plan.
(2) Includes shares remaining for issuance in the following amounts: Employee
Stock Purchase Plan -- 558,414; 1987 Stock Option Plan -- 0; 1998 Stock
Option Plan -- 0; 2002 Stock Option Plan -- 1,157,000; 1998 Non-Employee
Directors Stock Option Plan -- 70,000; 2000 Non-Employee Directors Equity
Plan -- 35,727; and Amended and Restated Restricted Stock Award
Plan -- 45,137.
(3) There are no equity compensation plans that have not been approved by the
Corporation's Stockholders.
9
BOARD COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
Decisions on compensation of the Corporation's executives generally are made
by the Management Development and Executive Compensation Committee of the Board
of Directors ('Compensation Committee'). This committee currently consists of
six non-employee directors of the Corporation. Mr. Pidot serves the committee in
the capacity of counsel.
This Compensation Committee report provides the policies and philosophy
underlying decisions regarding executive compensation for fiscal year ended 2003
and how they affected Mr. Kallet, in particular, and in general Messrs. Conseur,
Fobare and Lupica and Ms. Suttmeier -- the four executive officers other than
Mr. Kallet who for fiscal year ended 2003 were the Corporation's most highly
paid executive officers.
ONEIDA'S EXECUTIVE COMPENSATION POLICIES
The Corporation's executive compensation programs are designed to retain and
reward executives who are capable of leading the Corporation to achieve its
business objectives in an industrial and market environment characterized by
growth, complexity, competition and change.
Increasingly, compensation is provided in the form of cash or stock-based
incentive plans intended to integrate pay with the Corporation's annual and
long-term performance goals, recognizing both individual initiative and
achievements as well as contributions toward overall divisional and corporate
performance.
Executives other than the named executive officers are eligible for
selection as participants in the Corporation's executive incentive plans.
Moreover, all employees of the Corporation's Oneida Silversmiths Division
participate in an annual profit sharing plan based on the performance of that
business unit. However, these employees typically receive a larger percentage of
their compensation in wages or salary than do senior executives.
As a result of the emphasis on tying executive compensation to business
performance, compensation may fluctuate from year to year. Historically, in
successful years, a substantial portion of executives' total compensation was
earned through incentives. In less profitable years, less or no incentive
compensation is paid.
Annual compensation for Oneida's executive management consists of three
elements:
1. Salary -- In general, salaries are influenced by compensation paid to
executives of corporations with similar revenues and scopes of operation.
Within that framework, individual salaries reflect personal contribution and
performance as well as experience and years of service. In evaluating an
executive's personal contribution and performance, the Corporation considers
the individual's contribution to the overall performance of the Corporation
or division; effectiveness in budget management; performance in assigned
special projects; and managerial ability.
2. Annual Cash Incentive -- These annual cash incentive payments are
tied directly to corporate or business unit performance:
a. Corporate -- For executives with corporate responsibilities, their
incentive measurements for fiscal year ended 2003 were Return on
Equity and Income before Taxes. These two factors reflect the
Corporation's relative emphasis on return and growth; and
b. Other -- For executives whose responsibilities are limited to a
division or subsidiary, incentives are based on their business
unit's operating income and cash flow.
3. Stock Awards and Options -- The Corporation believes its senior
executives should have a greater equity interest in the Corporation as a way
of aligning their interests with those of stockholders. Long-term stock
incentive programs have been designed with this interest in mind:
a. 2002 Stock Option Plan -- This Plan provides an incentive that
focuses executives' attention on managing the Corporation from the
perspective of an owner with an equity stake in the business.
Because the option price is the fair market value of a share at
the time of the grant, stock options are tied to the future
performance of stock and will provide value to the recipient only
when the price of the stock rises above the option grant price;
and
b. Amended and Restated Restricted Stock Award Plan -- This Plan is
intended to promote the growth and profitability of the
Corporation by providing long-term equity rewards to key employees
who are expected to have a significant impact on the performance
of the Corporation. These awards provide a long-term focus since,
in general, the stock is restricted from being sold, transferred
or assigned and is forfeitable until it vests.
10
THE CHIEF EXECUTIVE'S FISCAL YEAR ENDED 2003 COMPENSATION
SEC regulations require the Compensation Committee to discuss its basis for
decisions affecting the chief executive's compensation for the fiscal year ended
2003 in relation to the Corporation's performance during that fiscal year.
The Compensation Committee's general approach in setting the chief
executive's annual compensation seeks to reflect compensation levels of other
corporations with similar revenues and scopes of operation, but to provide a
large percentage of his target compensation based on objective long-term
performance criteria. This provides an incentive to work toward clearly defined
long-term goals while providing stability by giving the chief executive some
certainty in the level of his compensation through the non-performance based
elements.
The chief executive's compensation package includes two performance-based
incentive programs -- one based on the long-term performance of the
Corporation's stock and the other based on corporate performance during the
previous year. These incentive programs have had the effect of more directly
tying compensation to the Corporation's performance. As a result, compensation
for the chief executive declined last year as performance fell below the levels
achieved the previous year.
In the stock performance-based program, payouts are determined by the
average annual growth in earnings per share of the Corporation's Common Stock
over the prior three-year period. In years when the performance goals are met,
the chief executive officer may elect to receive his award in cash, restricted
stock through the Corporation's Amended and Restated Restricted Stock Award
Plan, or a combination of both. A stock selection is encouraged by setting the
election price at 80 percent of the average Common Stock prices on the last day
of each of the preceding four fiscal quarters.
Mr. Kallet earned no incentive under this program during the past fiscal
year because its performance goals were not met.
The remainder of Mr. Kallet's performance-based compensation for fiscal year
ended 2003 derived from the program for the chief executive officer which
provides for annual cash incentives as well as restricted stock awards based on
corporate performance during the preceding fiscal year. The features of this
program are:
1. Payouts are based on a formula of 50 percent Return on Equity and 50
percent Income before Taxes, reflecting the Corporation's present relative
emphasis on return and growth;
2. The program incorporates base or platform performance objectives
which must be met before any payments are made. These performance objectives
are set for a two-year period. They are based on goals for good performance,
rather than levels which happen to be attainable in a given year; and
3. In years when performance goals are met, in addition to his cash
incentive, the Chief Executive Officer will be considered for a restricted
stock award under the Corporation's Amended and Restated Restricted Stock
Award Plan. The value of the stock award will be one-third of the profit
sharing payout, with the number of shares determined by market price.
Mr. Kallet earned no incentives under this program during the past fiscal
year because its performance goals were not met.
During the period December 2001 through July 2002, the salaries of all
senior executives, including Mr. Kallet, were reduced by 10%.
Mr. Kallet, with other Corporation executives, participates in the stock
option plan discussed above.
SUBMITTED BY THE MANAGEMENT DEVELOPMENT AND EXECUTIVE COMPENSATION COMMITTEE OF
THE BOARD OF DIRECTORS
Georgia S. Derrico, Chairman
William F. Allyn
R. Quintus Anderson
Gregory M. Harden
Peter J. Marshall
William M. Tuck
11
REPORT OF AUDIT COMMITTEE
To the Board of Directors
The Audit Committee is currently comprised of the six directors named below.
Each member of the Audit Committee is an independent director as defined by the
current New York Stock Exchange rules. The Audit Committee has adopted a written
charter which has been approved by the Board of Directors.
We have reviewed and discussed with management the Corporation's audited
financial statements as of and for the fiscal year ended January 25, 2003.
We have discussed with PricewaterhouseCoopers LLP the matters required to be
discussed by Statement on Auditing Standards No 61, Communication with Audit
Committees, as amended, by the Auditing Standards Board of the American
Institute of Certified Public Accountants.
We have received and reviewed the written disclosures and the letter from
PricewaterhouseCoopers LLP required by Independence Standard No. 1, Independence
Discussions with Audit Committees, as amended, by the Independence Standards
Board, and have discussed with the auditors the auditors' independence.
We have also considered whether the provision of services by
PricewaterhouseCoopers LLP not related to the audit of the financial statements
referred to above and to the reviews of the interim financial statements
included in the Corporation's Forms 10-Q for the quarters ended April 27, 2002,
July 27, 2002 and October 26, 2002 is compatible with maintaining
PricewaterhouseCoopers LLP's independence.
Based on the reviews and discussions referred to above, we recommend to the
Board of Directors that the financial statements referred to above be included
in the Corporation's Annual Report on Form 10-K for the fiscal year ended
January 25, 2003.
Peter J. Marshall, Chairman
William F. Allyn
R. Quintus Anderson
Georgia S. Derrico
Gregory M. Harden
William M. Tuck
12
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Pidot is regularly invited to attend meetings of the Management
Development and Executive Compensation Committee by invitation as counsel, but
he is not a voting member of the Committee.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Corporation has, for over 75 years, used the services of the law firm of
Shearman & Sterling, in which Mr. Pidot is a partner and member of the Executive
Group, for a variety of matters. Management believes that the Corporation's
relationship with Shearman & Sterling during the past fiscal year was on terms
that were reasonable and in the best interests of the Corporation.
1998-2003 STOCKHOLDERS' RETURN GRAPH
The following line graph compares the cumulative total stockholder return of
the Corporation's Common Stock with returns for the Russell 2000 Index and a
'Housewares Peer Group' for the period covering the Corporation's past five
fiscal years. Proxy statement disclosure rules adopted by the Securities and
Exchange Commission require such a total stockholder return comparison using
both a broad-based stock price index and a line-of-business comparator group.
The composition of the Russell 2000 Index meets the broad-based stock price
index requirement, which permits market capitalization to be a factor. The
median market capitalization of the Russell 2000 Index companies was
approximately $395 million as of the last reconstitution of the index. The
Corporation's average start-of-year market capitalization for the five-year
performance period was $307 million.
The 'Housewares Peer Group' is comprised of those companies, currently
included in the Investors Business Daily 'Housewares' stock price index, which
had market capitalizations of less than $750 million at the start of each of the
fiscal years covered by the graph. These companies are: Home Products
International, Inc., Libbey Inc. and Lifetime Hoan Corp.
The return values set forth below and plotted on the graph are based on an
initial investment of $100 on January 31, 1998, in the Corporation's Common
Stock, and each of the two comparator investment groups, with all dividends
treated as reinvested, and each component company within an investment group
weighted by its start-of-year market capitalization.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
ONEIDA LTD., RUSSELL 2000 INDEX AND PEER GROUP
(PERFORMANCE RESULTS THROUGH 1/31/03)
[PERFORMANCE GRAPH]
1/31/98 1/31/99 1/31/00 1/31/01 1/31/02 1/31/03
ONEIDA LTD. 100.00 53.82 80.55 68.63 47.00 43.62
RUSSELL 2000 INDEX 100.00 100.56 118.52 123.06 118.80 92.81
PEER GROUP 100.00 78.96 77.02 80.73 88.01 65.61
13
ONEIDA LTD.
2003 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
RECOMMENDATION
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE ONEIDA LTD. 2003
NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN (THE 'DIRECTORS PLAN') AND THE
RESERVATION OF 100,000 SHARES OF COMMON STOCK OF THE COMPANY FOR ISSUANCE UNDER
THE DIRECTORS PLAN AND RECOMMENDS THAT SHAREHOLDERS VOTE 'FOR' THE DIRECTORS
PLAN AND THE RESERVATION OF SHARES FOR ISSUANCE THEREUNDER.
DESCRIPTION OF THE PLAN
At its March 26, 2003 meeting, the Board of Directors unanimously adopted
the Oneida Ltd. 2003 Non-Employees Directors Stock Option Plan (the 'Plan'),
subject to the approval thereof by the shareholders of the Company at the Annual
Meeting. A copy of the Plan is attached to this proxy statement as Exhibit A,
and the description of the Plan herein is qualified by reference to the text of
the attached Plan.
PURPOSES. The purpose of the Plan is to help the Company attract, retain and
compensate as directors highly qualified persons who are not employees of the
Company or its subsidiaries and to secure for the Company the inherent benefit
of increased stock ownership by such directors.
ELIGIBILITY. Only members of the Board of Directors who are not employees of
the Company or any of its subsidiaries may participate in the Plan.
SHARES AVAILABLE UNDER THE PLAN. A total of 100,000 shares of Common Stock
will be reserved for issuance under the Plan, which amount will be
proportionately adjusted in the event of certain changes in the Company's
capitalization, a merger, or a similar transaction. Shares issued pursuant to
the Plan may be either authorized but unissued treasury shares or any
combination thereof.
ADMINISTRATION. The Plan will be administered by a committee consisting
exclusively of members of the Board of Directors who are not non-employee
directors. The committee will have full and final authority to construe and
interpret the Plan, make factual and legal determinations, adopt such rules and
regulations as it deems necessary to carry out the purposes of the Plan and take
any other actions necessary or advisable for the administration of the Plan.
OPTION GRANTS. The Plan provides for automatic, non-discretionary grants of
nonqualified stock options ('Options') to non-employee directors. Each
non-employee director will receive, on the date of his or her initial election
or appointment to the Board of Directors (or reelection or reappointment after a
period of at least twelve months during which he or she did not serve on the
Board of Directors), an option to purchase 1,000 shares of Common Stock. On the
third business day immediately following the date on which the Company issues a
press release announcing its earnings for the fourth quarter of the applicable
fiscal year, each non-employee director who has served as a member of the Board
of Directors since the preceding annual meeting will receive an additional
option to purchase 1,000 shares of Common Stock. All Options will have a per
share exercise price equal to the fair market value of a share of Common Stock
on the date of grant. Such exercise price may be paid in cash or previously
owned shares of Common Stock or a combination thereof.
Options shall automatically vest and become exercisable twelve months from
the date of grant of the applicable Option. Notwithstanding this vesting
schedule, an Option will become fully vested and exercisable upon a non-employee
director's termination of service due to death, disability, retirement in
accordance with the retirement policy for non-employee directors then in effect
or a Change of Control.
All Options expire ten years from the date of grant. If a non-employee
director's service as a member of the Board of Directors terminates due to
death, disability, retirement or a Change of Control, all Options must be
exercised within one year following such termination. If a non-employee
director's service as a member of the Board of Directors terminates for any
other reason, such non-employee director must exercise any Options that have
vested as of the date of such termination within the six month period following
such termination and all Options that have not vested as of the date of such
termination will immediately expire.
14
CHANGE OF CONTROL. For purposes of the Plan, a Change of Control shall be
deemed to have occurred upon the occurrence of any of the following:
(i) Any 'persons' or 'group' within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934 ('Act') becomes the
'beneficial owner' as defined in Rule 13d-3 under the Act of more than 20%
of the then outstanding voting securities of the Company;
(ii) Any 'person' or 'group' within the meaning of Sections 13(d) and
14(d)(2) of the Act acquires by proxy or otherwise more than 20% of the then
outstanding voting securities of the Company;
(iii) During any period of twenty-four consecutive months, Present
Directors and/or New Directors cease for any reason to constitute a majority
of the Board of Directors.
For these purposes, 'Present Directors' shall mean individuals who at the
beginning of such consecutive twenty-four month period were members of the Board
of Directors and 'New Directors' shall mean any director whose election by the
Board of Directors or whose nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds of the directors then
still in office who were Present Directors or New Directors;
(iv) the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company; or
(v) there shall be consummated:
(a) a reorganization, merger or consolidation of all or substantially
all of the assets of the Company (a 'Business Combination'), unless,
following such Business Combination,
(1) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the outstanding Common
Stock of the Company and outstanding voting securities of the Company
immediately prior to such Business Combination beneficially own,
directly or indirectly, more then 50% of, respectively, the then
outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in
the election of directors, as the case may be, of the corporation
resulting from such Business Combination in substantially the same
proportions as their ownership, immediately prior to such Business
Combination of such securities,
(2) no person (excluding any company resulting from such Business
Combination or any employee benefit plan (or related trust) of the
Company or such company resulting from such Business Combination)
beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined
voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to
the Business Combination, and
(3) at least a majority of the members of the board of directors
of the corporation resulting from such Business Combination were
members of the Board of Directors at the time of the execution of the
initial agreement, or of the action of the Board of Directors,
providing for such Business Combination; or
(b) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all, or substantially all, of the
assets of the Company, provided that the divesture of less than
substantially all of the assets of the Company in one transaction or a
series of related transactions shall not constitute a Change of Control.
Notwithstanding the foregoing, a Change of Control shall not be deemed to
occur pursuant to subparagraph (i) and (ii) above, solely because twenty percent
(20%) or more of the combined voting power of the Company's then outstanding
securities is acquired by one or more employee benefit plans maintained by the
Company.
AMENDMENT OF THE PLAN. The Board of Directors may amend or terminate the
Plan at any time, except that shareholder approval is required to increase the
maximum number of shares issuable under the Plan. The consent of a non-employee
director is required to the extent that any amendment or termination would
adversely affect such non-employee director's right with respect to any
previously Option granted.
15
ADJUSTMENT. In the event of any change in the outstanding Common Stock by
reason of a stock dividend, recapitalization, reorganization, merger,
consolidation, stock split, combination or exchange of shares or any other
significant corporate event the committee, in it discretion, may make (i) such
proportionate adjustments as it considers appropriate to prevent diminution or
enlargement of the rights of participants under the Plan and/or (ii) such other
adjustments as it deems appropriate.
TERMINATION OF THE PLAN. By its terms, the Plan will remain in effect until
termination by the Board of Directors. No awards may be granted after the annual
meeting of shareholders to be held in 2013.
NEW PLAN BENEFITS
As of the date of this Proxy, no non-employee director has been granted an
Option pursuant to the proposed Plan. It is not presently possible to determine
the benefits or amounts that will be received by any non-employee director in
the future.
U.S. FEDERAL INCOME TAX CONSEQUENCES
OPTION GRANTS. The grant of an Option will not result in the recognition of
taxable income by the non-employee director or in a deduction to the Company.
Upon exercise, a non-employee director will recognize ordinary income in an
amount equal to the excess of the fair market value of the Common Stock
purchased over the exercise price, and tax deduction is allowable to the Company
equal to the amount of such income. Gain or loss upon a subsequent sale of any
Common Stock received upon the exercise of an Option generally would be taxed as
capital gain or loss (long-term or short-term, depending upon the holding period
of the Common Stock sold). Certain additional rules apply if the exercise price
for an Option is paid in shares of Common Stock previously owned by the
non-employee director.
16
APPROVAL OF INDEPENDENT AUDITORS
The Audit Committee of the Board of Directors has recommended, and the Board
of Directors has affirmed, the reappointment of PricewaterhouseCoopers LLP as
independent certified public accountants for the Corporation's fiscal year ended
January 31, 2004, subject to ratification by the Corporation's Stockholders. In
the event the Stockholders fail to ratify the reappointment of
PricewaterhouseCoopers LLP, the selection of alternate independent auditors will
be considered by the Audit Committee and the Board of Directors. Since the
Corporation's Certificate of Incorporation and By-Laws do not require
Stockholder approval or ratification of the Board's appointment of independent
auditors, the Audit Committee and the Board of Directors may, in their
discretion, appoint alternate independent auditors at any time during the fiscal
year, notwithstanding Stockholder ratification of the reappointment of
PricewaterhouseCoopers LLP.
The Board of Directors considers PricewaterhouseCoopers LLP to be well
qualified and recommends a vote FOR the ratification of the reappointment of
PricewaterhouseCoopers LLP.
PricewaterhouseCoopers LLP fees for services provided to the Corporation for
the fiscal year ended January 25, 2003 are as follows: Audit Fees -- $302,680;
Financial Information Systems Design and Implementation Fees -- $0; All Other
Fees -- $233,550. All Other Fees includes $129,000 for tax services and $104,550
for employee benefits services.
Representatives from PricewaterhouseCoopers LLP will attend the Annual
Meeting with the opportunity to make a statement and to answer questions from
stockholders.
STOCKHOLDER PROPOSALS
Pursuant to amendments to Rule 14a-4(c) of the Securities Exchange Act of
1934, as amended, if a stockholder who intends to present a proposal at the 2004
Annual Meeting of Stockholders does not notify the Corporation of such proposal
on or prior to February 25, 2004, then management proxies will be allowed to use
their discretionary voting authority to vote on the proposal when the proposal
is raised at the Annual Meeting, even though there is no discussion of the
proposal in the 2004 proxy statement.
Notwithstanding the above, in order to be included in the Corporation's
proxy statement relating to the 2004 Annual Meeting, proposals of stockholders
intended to be presented to the Corporation's 2004 Annual Meeting of
Stockholders must be received at the Corporation's principal executive offices
not later than January 2, 2004. Proposals should be addressed to Catherine H.
Suttmeier, Secretary, Oneida Ltd., Oneida, New York 13421.
17
OTHER MATTERS
Other than the foregoing, the Board of Directors knows of no matters which
will be presented at the Annual Meeting for action by stockholders. However, if
any other matters properly come before the meeting, or any adjournment thereof,
it is anticipated that the proxies will be voted according to the best judgment
of the persons acting by authorization of the proxies.
The Annual Report of the Corporation for the fiscal year ended January 25,
2003 including audited financial statements is included with this mailing.
By Order of the Board of Directors
CATHERINE H. SUTTMEIER
CATHERINE H. SUTTMEIER
Secretary
Oneida, New York
April 25, 2003
18
EXHIBIT A
ONEIDA LTD.
2003 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
1. PURPOSES
The purposes of the Plan are to attract, retain and compensate highly
qualified individuals who are not employees of the Company for service as
members of the Board of Directors of the Company and to provide them with an
ownership interest in the Company's Common Stock. The Plan will be beneficial to
the Company and its stockholders by allowing Non-Employee Directors to (i) have
a personal financial stake in the Company through an ownership interest in the
Company's Common Stock and (ii) underscore their common interest with
stockholders in increasing the value of the Company's Common Stock over the long
term.
2. DEFINITIONS AND RULES OF CONSTRUCTION
(a) Definitions. For purposes of this Plan, the following capitalized words
shall have the meanings set forth below:
'Annual Award' means an award of Options pursuant to Section 5(b) of the
Plan.
'Annual Meeting' means an annual meeting of the Company's stockholders.
'Board' means the Board of Directors of the Company.
'Change of Control of the Company' shall be deemed to occur if any of
the following circumstances shall occur:
(i) any 'person' or 'group' within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934 ('Act') becomes the
'beneficial owner' as defined in Rule 13d-3 under the Act of more than
20% of the then outstanding voting securities of the Company;
(ii) any 'person' or 'group' within the meaning of Sections 13(d) and
14(d)(2) of the Act acquires by proxy or otherwise the right to vote for
the election of directors, for any merger or consolidation of the Company
or for any other matter or question with respect to more than 20% of the
then outstanding voting securities of the Company;
(iii) during any period of twenty-four consecutive months, Present
Directors and/or New Directors cease for any reason to constitute a
majority of the Board.
For these purposes, 'Present Directors' shall mean individuals who at
the beginning of such consecutive twenty-four month period were
members of the Board and 'New Directors' shall mean any director whose
election by the Board or whose nomination for election by the
Company's stockholders was approved by a vote of at least two-thirds
of the Directors then still in office who were Present Directors or
New Directors;
(iv) the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company; or
(v) there shall be consummated:
(a) a reorganization, merger or consolidation of all or
substantially all of the assets of the Company (a 'Business
Combination'), unless, following such Business Combination,
(1) all or substantially all of the individuals and entities
who were the beneficial owners, respectively, of the outstanding
Common Stock of the Company and outstanding voting securities of
the Company immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the
case may be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation which
as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or
through one or more subsidiaries) in
A-1
substantially the same proportions as their ownership,
immediately prior to such Business Combination of the outstanding
Common Stock of the Company and outstanding voting securities of
the Company, as the case may be,
(2) no person (excluding any company resulting from such
Business Combination or any employee benefit plan (or related
trust) of the Company or such company resulting from such
Business Combination) beneficially owns, directly or indirectly,
20% or more of, respectively, the then outstanding shares of
common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that
such ownership existed prior to the Business Combination and
(3) at least a majority of the members of the board of
directors of the corporation resulting from such Business
Combination were members of the Board at the time of the
execution of the initial agreement, or of the action of the
Board, providing for such Business Combination; or
(b) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or
substantially all, of the assets of the Company, provided, that the
divestiture of less than substantially all of the assets of the
Company in one transaction or a series of related transactions,
whether effected by sale, lease, exchange, spin-off, sale of the
stock or merger of a subsidiary or otherwise, shall not constitute a
Change of Control.
Notwithstanding the foregoing, a Change of Control shall not be deemed to
occur pursuant to subparagraphs (i) and (ii) above, solely because twenty
percent (20%) or more of the combined voting power of the Company's then
outstanding securities is acquired by one or more employee benefit plans
maintained by the Company.
'Code' means the Internal Revenue Code of 1986, as amended.
'Committee' means the committee designated by the Board pursuant to Section
3(c) of the Plan.
'Common Stock' means the Common Stock of the Company, par value $1.00 per
share, or such other class or kind of shares or other securities as may be
applicable under Section 12.
'Company' means Oneida Ltd, a New York corporation, or any successor to all
or substantially all its business.
'Effective Date' means May 28, 2003.
'ERISA' means the Employee Retirement Income Security Act of 1974, as
amended.
'Exchange Act' means the Securities Exchange Act of 1934, as amended.
'Fair Market Value' means, with respect to a share of Common Stock, the fair
market value thereof as of the relevant date of determination, as determined in
accordance with a valuation methodology approved by the Committee. In the
absence of any alternative valuation methodology approved by the Committee, the
Fair Market Value of a share of Common Stock shall equal the closing price of a
share of Common Stock as reported on the composite tape for securities listed on
the New York Stock Exchange, or such other national securities exchange as may
be designated by the Committee, or, in the event that the Common Stock is not
listed for trading on a national securities exchange but is quoted on an
automated system, on such automated system, in any such case on the valuation
date (or, if there were no sales on the valuation date, the closing price as
reported on said composite tape or automated system for the most recent day
during which a sale occurred).
'Initial Award' means an award of Options pursuant to Section 5(a) of the
Plan.
'Non-Employee Director' means a member of the Board who is not an employee
of the Company or a Subsidiary.
'Option' means an option to purchase shares of Common Stock awarded to a
Non-Employee Director pursuant to the Plan. Options awarded pursuant to this
Plan shall be non-statutory stock options.
'Option Shares' means the shares of Common Stock issuable upon exercise of
an Option.
'Permanent Disability' means a medically determinable physical or mental
impairment rendering a Non-Employee Director substantially unable to function as
a member of the Board for any period of six consecutive
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months. Any dispute as to whether a Non-Employee Director is Permanently
Disabled shall be resolved by a physician mutually acceptable to the
Non-Employee Director and the Company, whose decision shall be final and binding
upon the Non-Employee Director and the Company.
'Plan' means the Oneida Ltd. 2003 Non-Employee Directors Stock Option Plan,
as may be amended from time to time, as described herein.
'Retirement' means a Non-Employee Director ceasing to be a member of the
Board as a result of retirement from the Board in accordance with the retirement
policy then applicable to Board members.
'Subsidiary' means (i) a domestic or foreign corporation or other entity
with respect to which the Company, directly or indirectly, has the power,
whether through the ownership of voting securities, by contract or otherwise, to
elect at least a majority of the members of such corporation's board of
directors or analogous governing body, or (ii) any other domestic or foreign
corporation or other entity in which the Company, directly or indirectly, has an
equity or similar interest and which the Committee designates as a Subsidiary
for purposes of the Plan.
'1933 Act' means the Securities Act of 1933, as amended.
(b) Rules of Construction. The masculine pronoun shall be deemed to include
the feminine pronoun and the singular form of a word shall be deemed to include
the plural form, unless the context requires otherwise. Unless the text
indicates otherwise, references to sections are to sections of the Plan. In
addition, it is the intent of the Company that transactions pursuant to this
Plan satisfy and be interpreted in a manner that satisfies the applicable
conditions for exemption under Rule 16b-3 promulgated under the Exchange Act
('Rule 16b-3') so that the granting of Options, and the distribution of shares
of Common Stock pursuant to the exercise of Options, hereunder will be entitled
to the benefits of Rule 16b-3 or other exemptive rules under Section 16 of the
Exchange Act and will not be subjected to avoidable liability thereunder. The
Committee may, subject to Section 14 hereof, grant Options that would not
qualify for exemption under Section 16(b) of the Exchange Act, so long as the
availability of any exemption thereunder for other Non-Employee Directors
participating under this Plan is not compromised.
3. SHARES AVAILABLE; ADMINISTRATION
(a) Plan Limit. Subject to the provisions of Section 10(b) of the Plan, the
maximum number of shares of Common Stock which may be delivered upon exercise or
Option granted under the Plan shall be (i.) 100,000 shares of Common Stock, plus
(ii.) any shares of Common Stock that are available for issuance or that become
available for issuance under the Oneida Ltd. 1998 Non-Employee Directors Stock
Option Plan (the 'Plan Limit'). Either authorized and unissued shares of Common
Stock or treasury shares may be delivered upon exercise of Options awarded
pursuant to the Plan.
(b) Rules Applicable to Determining Shares Available for Issuance. If
Options have been forfeited to the Company as described in Section 6(c) or are
terminated unexercised, the Options Shares underlying such Options shall again
be available for issuance in connection with future awards under the Plan. In
addition, the number of shares of Common Stock tendered to pay the exercise
price of an Option or to satisfy a Participant's tax withholding obligations
shall be added back to the Plan Limit and again be available for the grant of
Options.
(c) Administration. The Plan will be administered by a committee designated
by the Board and composed exclusively of members of the Board who are not
Non-Employee Directors (the 'Committee'). Subject to the provisions of this
Plan, the Committee shall have full and final authority to (i) interpret the
Plan; (ii) establish, amend and rescind any rules and regulations relating to
the Plan; (iii) prescribe award documentation; (iv) make factual and legal
determinations in connection with the administration or interpretation of the
Plan; and (v) take any other actions necessary or advisable for the
administration of the Plan. The Committee's interpretation of the Plan, and all
actions taken and determinations made by the Committee pursuant to the powers
vested in it hereunder, shall be conclusive and binding upon all parties
concerned including the Company, its stockholders and persons granted Options
under the Plan. The Chairman of the Board shall be authorized to implement the
Plan in accordance with its terms and to take or cause to be taken such actions
of a ministerial nature as shall be necessary to effectuate the intent and
purposes thereof.
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4. ELIGIBILITY
Options awarded pursuant to the Plan shall be granted only to active members
of the Board who are not, as of the date of any Option grants, employees of the
Company or any of its Subsidiaries or affiliates.
5. OPTION GRANT
(a) Initial Award. On the date of a Non-Employee Director's initial election
or appointment to the Board, such Non-Employee Director (including any
Non-Employee Director reelected or reappointed after a period of at least 12
calendar months during which he did not serve on the Board) shall be granted an
Initial Award consisting of an Option to purchase 1,000 shares of Common Stock.
Such Option shall have a per share exercise price equal to the Fair Market Value
of the Common Stock on the date of the award and shall be subject to the vesting
schedule provided for in Section 6(a) and the other terms and conditions
provided for herein.
(b) Annual Awards. On each third business day immediately following the date
on which the Company issues a press release announcing its earnings for the
fourth quarter of the applicable fiscal year during the term of the Plan, each
person who has continuously served as a member of the Board since the
immediately preceding Annual Meeting shall be awarded an Annual Award consisting
of an Option to purchase 1,000 shares of Common Stock The Option shall have a
per share exercise price equal to the Fair Market Value of the Common Stock on
the date such Option is granted and shall be subject to the vesting schedule
provided for in Section 6(a) and the other terms and conditions provided for
herein.
6. VESTING
(a) Vesting. Options awarded pursuant to the Plan shall vest and become
exercisable twelve months from the date of the Option grant.
(b) Accelerated Vesting. Notwithstanding anything to the contrary in Section
6(a), an Option shall become fully vested and exercisable upon the earlier to
occur of (i) a Non-Employee Director ceasing to be a member of the Board as a
result of death, Permanent Disability or Retirement, or (ii) a Change of Control
of the Company.
(c) Forfeiture. In the event of a Non-Employee Director's termination of
service as a member of the Board for any reason other than death, Permanent
Disability, Retirement or a Change of Control of the Company prior to the
satisfaction of the vesting period described in Section 6(a), the unvested
portion of any Options awarded to the Non-Employee Director shall be forfeited
to the Company as of the date of termination of service, and the Non-Employee
Director shall have no further rights or interest therein.
7. TERM OF OPTIONS
(a) Ten-Year Term. Each Option shall expire ten (10) years from the date of
its grant, subject to earlier termination as provided herein.
(b) Exercise Following Certain Terminations of Service. If a Non-Employee
Director's service as a member of the Board terminates for any reason other than
death, Permanent Disability, Retirement or a Change of Control of the Company,
the Non-Employee Director shall have the right, subject to the terms and
conditions hereof, to exercise the Option, to the extent it has vested as of the
date of such termination of service, at any time within six months after the
date of such termination, subject to the earlier expiration of the Option as
provided in Section 7(a). At the end of such six-month period the Option shall
expire.
(c) Exercise Following Termination of Service Due to Death, Permanent
Disability, Retirement or a Change of Control of the Company. If a Non-Employee
Director's service as a member of the Board terminates by reason of death,
Permanent Disability, Retirement or a Change of Control of the Company, all
Options awarded to such Non-Employee Director that remain outstanding may be
exercised by such Non-Employee Director, or by his or her estate, personal
representative or beneficiary, as the case may be, at any time within one year
after the date of termination of service, subject to the earlier expiration of
the Option as provided in Section 7(a). At the end of such one-year period the
Option shall expire.
(d) Exercise Following Termination of Service Subject to Company Policies
and Procedures on Insider Trading. Any exercise of an Option pursuant to Section
7(b) or 7(c) following termination of a Non-Employee Director's service as a
member of the Board for any reason other than death shall be subject to, and
shall be
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permitted only to the extent such exercise complies with, the policies and
procedures of the Company concerning insider trading that were applicable to the
Non-Employee Director on the date of such termination of service (as such
policies and procedures may be amended by the Company during the period provided
in Section 7(b) or 7(c), as the case may be, for exercise of the Option).
8. TIME AND MANNER OF EXERCISE
(a) Notice of Exercise. Subject to the other terms and conditions hereof, a
Non-Employee Director may exercise any Options (to the extent vested) by giving
written notice of exercise to the Company; provided, however, that no less than
100 Option Shares may be purchased upon any exercise of the Option unless the
number of Option Shares purchased at such time is the total number of Option
Shares in respect of which an Option is then exercisable, and provided, further,
that in no event shall an Option be exercisable for a fractional share. The date
of exercise of an Option shall be the later of (i) the date on which the Company
receives such written notice or (ii) the date on which the conditions provided
in Section 8(b) are satisfied. Notwithstanding any other provision of the Plan
or of the notice of award relating to an Option provided for in Section 9, no
Option may be exercised, whether in whole or in part, and no Option Shares will
be issued by the Company in respect of any such attempted exercise, at any time
when such exercise is prohibited by Company policy then in effect concerning
transactions by a Non-Employee Director in the Company's securities. In the
event that a Non-Employee Director gives written notice of exercise to the
Company at a time when such exercise is prohibited by such policy, the Company
in its sole discretion may disregard such notice of exercise or may consider
such notice to be delivered as of the first date that the Non-Employee Director
is permitted to exercise such Option in accordance with such Company policy.
(b) Payment. Prior to the issuance of a certificate pursuant to Section 8(e)
hereof evidencing the Option Shares in respect of which all or a portion of an
Option shall have been exercised, a Non-Employee Director shall have paid to the
Company the exercise price for all Option Shares purchased pursuant to the
exercise of such Option. Payment shall be made upon exercise of the Option, and
such Option price shall be paid (i) by personal check, bank draft or postal or
express money order (such modes of payment are collectively referred to as
'cash') payable to the order of the Company in U.S. dollars, (ii) in whole
shares of Common Stock of the Company owned by the Non-Employee Director prior
to exercising the Option, or (iii) in a combination of cash and delivery of
shares of Common Stock as the Board in its sole discretion may approve. In
addition to the exercise methods described above, a Non-Employee Director may
exercise an Option through a procedure whereby the Non-Employee Director
delivers to the Company an irrevocable notice of exercise in exchange for the
Company issuing the shares of Common Stock subject to the Option to a broker
previously designated or approved by the Company, subject to the rules and
procedures as the Committee may determine.
(c) Stockholder Rights. A Non-Employee Director shall have no rights as a
stockholder with respect to any shares of Common Stock issuable upon exercise of
an Option until a certificate evidencing such shares shall have been issued to
the Non-Employee Director pursuant to Section 8(e), and no adjustment shall be
made for dividends or distributions or other rights in respect of any share for
which the record date is prior to the date upon which the Non-Employee Director
shall become the holder of record thereof.
(d) Limitation on Exercise. No Option shall be exercisable unless the Common
Stock subject thereto has been registered under the Securities Act and qualified
under applicable state 'blue sky' laws in connection with the offer and sale
thereof, or the Company has determined that an exemption from registration under
the Securities Act and from qualification under such state 'blue sky' laws is
available.
(e) Issuance of Shares. Subject to the foregoing conditions, as soon as is
reasonably practicable after its receipt of a proper notice of exercise and
payment of the Option price for the number of shares with respect to which the
Option is exercised, the Company shall deliver to the Non-Employee Director (or
following the Non-Employee Director's death, such other person entitled to
exercise the Option), at the principal office of the Company or at such other
location as may be acceptable to the Company and the Non-Employee Director (or
such other person), one or more stock certificates for the appropriate number of
shares of Common Stock issued in connection with such exercise. Such shares
shall be fully paid and nonassessable and shall be issued in the name of the
Non-Employee Director (or such other person).
(f) Tax Withholding. If the Company or a Subsidiary shall be required to
withhold any amounts by reason of any federal, state or local tax rules or
regulations in respect of the issuance of Option Shares, the Company or
A-5
a Subsidiary, as applicable, shall have the right, prior to the delivery of any
certificates evidencing such Option Shares to be issued upon full or partial
exercise of an Option, to require a Non-Employee Director to remit to the
Company or a Subsidiary, as applicable, any amount sufficient to satisfy any
Federal, state or local tax withholding requirements. The Company or a
Subsidiary, as applicable, may permit the Non-Employee Director to satisfy, in
whole or in part, such obligation to remit taxes, by directing the Company to
withhold shares of Common Stock that would otherwise be received by the
Non-Employee Director in an amount equal to the amount of the minimum
withholding tax obligation, pursuant to such rules as the Committee may
establish from time to time, by delivering to the Company or a Subsidiary, as
applicable, shares of Common Stock owned by the Non-Employee Director prior to
exercising the Option, or by making a payment to the Company or such Subsidiary
consisting of a combination of cash and such shares of Common Stock. Such an
election shall be subject to the following:
(i) the election shall be made in such manner as may be prescribed by
the Committee and the Committee shall have the right, in its discretion, to
disapprove such election; and
(ii) the election shall be made prior to the date to be used to
determine the tax to be withheld and shall be irrevocable.
The value of any share of Common Stock to be withheld by the Company or
delivered to the Company pursuant to this Section 8(f) shall be the Fair Market
Value of the Common Stock on the date to be used to determine the amount of tax
to be withheld.
The Company or a Subsidiary, as applicable, shall also have the right to
deduct from all cash payments made pursuant to or in connection with the Option
any Federal, state or local taxes required to be withheld with respect to such
payments. The Committee may establish such rules and procedures, including,
without limitation, any rules or procedures necessary to comply with Rule 16b-3,
as it may deem necessary or advisable in connection with the withholding of
taxes relating to the exercise of any Option.
(g) Restrictions on Transfer. An Option may not be transferred, pledged,
assigned, or otherwise disposed of, except by will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined in
the Code or Title I of ERISA ('QDRO'). The Option shall be exercisable, during
the Non-Employee Director's lifetime, only by the Non-Employee Director or by
the person to whom the Option has been transferred pursuant to a QDRO. No
assignment or transfer of the Option, or of the rights represented thereby,
whether voluntary or involuntary, by operation of law or otherwise, except by
will or the laws of descent and distribution or pursuant to a QDRO, shall vest
in the assignee or transferee any interest or right in the Option, but
immediately upon any attempt to assign or transfer the Option the same shall
terminate and be of no force or effect.
(h) Non-Qualified Status of Options. Options awarded under the Plan are not
intended to qualify, and shall not be treated, as an 'incentive stock options'
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended.
9. NOTICE OF AWARD
The terms and conditions of each award of Options shall be embodied in a
certificate which shall incorporate the Plan by reference. Each certificate
shall state the date on which the Options were granted, the number of shares
subject to such Option and the per share exercise price therefor.
10. NO RESTRICTION ON RIGHT OF COMPANY TO EFFECT CORPORATE CHANGES
(a) Authority of the Company and Stockholders. The existence of the Plan,
any award certificates and the Options granted hereunder shall not affect or
restrict in any way the right or power of the Company or the stockholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of stock or of options, warrants or
rights to purchase stock or of bonds, debentures, preferred or prior preference
stocks whose rights are superior to or affect the Common Stock or the rights
thereof or which are convertible into or exchangeable for Common Stock, or the
dissolution or liquidation of the Company, or any sale or transfer of all or any
part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.
A-6
(b) Change in Capitalization. Notwithstanding any provision of the Plan or
any award certificates, the number and kind of shares authorized for issuance
under Section 3(a) may be equitably adjusted in the sole discretion of the
Committee in the event of a stock split, stock dividend, recapitalization,
reorganization, merger, consolidation, extraordinary dividend, split-up,
spin-off, combination, exchange of shares, warrants or rights offering to
purchase Common Stock at a price substantially below Fair Market Value or other
similar corporate event affecting the Common Stock in order to preserve, but not
increase, the benefits or potential benefits intended to be made available under
the Plan. In addition, upon the occurrence of any of the foregoing events, the
number of outstanding Options and the number and kind of shares subject to any
outstanding Option and the purchase price per share, if any, under any
outstanding Option may be equitably adjusted (including by payment of cash to a
Non-Employee Director) in the sole discretion of the Committee in order to
preserve the benefits or potential benefits intended to be made available to
Non-Employee Directors granted Options. Such adjustments shall be made by the
Committee, in its sole discretion, whose determination as to what adjustments
shall be made, and the extent thereof, shall be final. Unless otherwise
determined by the Committee, such adjusted Options shall be subject to the same
vesting schedule and restrictions to which the underlying Option is subject.
11. EFFECTIVE DATE; TERM OF THE PLAN
Subject to approval by the majority of the shareholders of the Company at
the 2003 Annual Meeting, the effective date of the Plan shall be May 28, 2003.
If the Plan is not approved by the stockholders at such Annual Meeting, the Plan
and all interests in the Plan awarded to Non-Employee Directors before the date
of such Annual Meeting shall be void ab initio and of no further force and
effect. Unless terminated earlier in accordance with Section 12 below, the Plan
shall terminate on the Annual Meeting of shareholders of the Company in 2013.
After such date, no further awards of Options may be made hereunder, but
previously granted awards shall remain outstanding subject to the terms hereof.
12. AMENDMENTS; TERMINATION
The Board may at any time and from time to time alter, amend, suspend or
terminate the Plan in whole or in part, provided, however, that in no event may
the provisions of the Plan respecting eligibility to participate or the timing
or amount of awards be amended more frequently than once every six months, other
than to comply with changes in the Code, ERISA or any rules or regulations
thereunder. Any amendment to the Plan, which under the requirements of
applicable law must be approved by the stockholders of the Company, shall not be
effective unless and until such stockholder approval has been obtained in
compliance with such law. Any amendment to the Plan that must be approved by the
stockholders of the Company in order to maintain the continued qualification of
the Plan under Rule 16b-3 under the Exchange Act, or any successor provision,
shall not be effective unless and until such stockholder approval has been
obtained in compliance with such rule. No termination or amendment of the Plan
may, without the written consent of the Non-Employee Director, affect any such
person's rights under the provisions of the Plan with respect to awards of
Options which were made prior to such action.
13. NO RIGHT TO CONTINUE AS DIRECTOR
Nothing in the Plan shall be deemed to create any obligation on the part of
the Board to nominate any of its members for reelection by the Company's
stockholders, nor confer upon any Non-Employee Director the right to remain a
member of the Board for any period of time, or at any particular rate of
compensation.
14. COMPLIANCE WITH SECTION 16(B) OF THE EXCHANGE ACT.
Notwithstanding anything contained in the Plan or any agreement under the
Plan to the contrary, if the consummation of any transaction under the Plan, or
the taking of any action by the Committee in connection with a change of control
of the Company, would result in the possible imposition of liability on a
Participant pursuant to Section 16(b) of the Exchange Act, the Committee shall
have the right, in its sole discretion, but shall not be obligated, to defer
such transaction or the effectiveness of such action to the extent necessary to
avoid such liability, but in no event for a period longer than six months.
15. GOVERNING LAW
The Plan and all award documents issued shall be construed in accordance
with and governed by the laws of the state of New York.
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Appendix 1
ANNUAL MEETING OF STOCKHOLDERS OF
ONEIDA LTD.
May 28, 2003
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
Please detach and mail in the envelope provided.
[ ]
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THE BOARD OF DIRECTORS RECOMMENDS AVOTE "FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS 2 AND 3.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
-----------------------------------------------------------------------------------------------------------------------------
| FOR AGAINST ABSTAIN
1. ELECTION of the following nominees as | 2. TO VOTE on the proposal to approve [ ] [ ] [ ]
directors for a three-year term | the Oneida Ltd. 2003 Non-Employee
expiring May 31, 2006: | Directors Stock Option Plan;
|
NOMINEES | 3. TO RATIFY the appointment of [ ] [ ] [ ]
[ ] FOR ALL NOMINEES O G. Derrico | PricewaterhouseCoopers LLP as
O P. Kallet | independent auditors;
O P. Marshall |
[ ] WITHHOLD AUTHORITY | 4. To act in their discretion on such other matters as may
FOR ALL NOMINEES | properly come before said meeting or any adjournment
| thereof.
[ ] FOR ALL EXCEPT |
(See instructions below) |
|
| Shares will be voted as specified and where no specification
| is made the vote of the undersigned will be cast FOR the
| election of directors and FOR the proposals outlined in (2)
| and (3).
|
| IMPORTANT: Please sign, date, and return this Proxy promptly in
| the accompanying envelope.
INSTRUCTION: To withhold authority to vote for any |
individual nominee(s), mark "FOR ALL |
EXCEPT" and fill in the circle next |
to each nominee you wish to withhold, |
as shown here: |
--------------------------------------------------------|
|
|
|
--------------------------------------------------------|
To change the address on your account, please [ ] |
check the box at right and indicate your new |
address in the address space above. Please note |
that changes to the registered name(s) on the |
account may not be submitted via this method. |
--------------------------------------------------------|
Signature of Stockholder ____________________ Date:_________ Signature of Stockholder ____________________ Date: _________
Note: This proxy must be signed exactly as the name appears hereon. When shares are held jointly, each holder must sign.
When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer
is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If signer is
a partnership, please sign in partnership name by authorized person.
ONEIDA LTD. - ANNUAL MEETING MAY 28, 2003
This Proxy is Solicited on Behalf of the Board of Directors
Annual Meeting of Stockholders ONEIDALTD. -- May 28, 2003
The undersigned, a holder of Common Stock of ONEIDA LTD., hereby appoints
GEORGIA S. DERRICO, PETER J. KALLET and CATHERINE H. SUTTMEIER, as Proxies of
the undersigned with full power of substitution and revocation, to vote all
shares of the stock of Oneida Ltd. which the undersigned would be entitled to
vote if personally present at the Annual Meeting of Stockholders of Oneida Ltd.
to be held May 28, 2003 and at any adjournments thereof, hereby revoking any
other Proxy heretofore given. A majority of said Proxies or their substitutes as
shall be present and acting at the said meeting shall have and may exercise all
the powers of said Proxies hereunder. The said Proxies are instructed:
CONTINUED AND TO BE ON REVERSE SIDE
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