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SCHEDULE 14A
(RULE 14a-101)
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 Rule 14a-12
HOME PRODUCTS INTERNATIONAL, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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HOME PRODUCTS INTERNATIONAL, INC.
4501 WEST 47TH STREET
CHICAGO, ILLINOIS 60632
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 24, 2001
To the Stockholders of Home Products International, Inc.
The Annual Meeting of Stockholders of Home Products International, Inc. a
Delaware corporation (the "Company"), will be held on Thursday, May 24, 2001 at
10:00 a.m., local time, at the Company's Corporate Offices, 4501 West 47th
Street, Chicago, IL 60632 for the following purposes, as more fully described in
the accompanying Proxy Statement.
1. To elect six (6) directors for the next year.
2. To approve the Home Products International, Inc. 2000 Employee Stock
Purchase Plan.
3. To transact such other business as may properly come before the annual
meeting.
Stockholders of record of the Company's Common Stock at the close of
business on April 6, 2001, the record date fixed by the Board of Directors, are
entitled to notice of, and to vote at, the meeting, also as more fully described
in the Proxy Statement.
All stockholders are cordially invited to attend the meeting. Those who
cannot attend are urged to sign, date and otherwise complete the enclosed proxy
and return it promptly in the envelope provided. Any stockholder giving a proxy
has the right to revoke it at any time before it is voted.
For the Board of Directors,
JAMES R. TENNANT
James R. Tennant
Chairman of the Board
Chicago, Illinois
April 11, 2001
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HOME PRODUCTS INTERNATIONAL, INC.
4501 WEST 47TH STREET
CHICAGO, ILLINOIS 60632
------------------
PROXY STATEMENT
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APPROXIMATE DATE PROXY MATERIAL
FIRST SENT TO STOCKHOLDERS:
APRIL 18, 2001
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The following information is provided in connection with the solicitation
of proxies for the Annual Meeting of Stockholders of Home Products
International, Inc., a Delaware corporation (the "Company" or "HPI"), to be held
on Wednesday, May 24, 2001 (the "Meeting"), for the purposes stated in the
attached Notice of Annual Meeting of Stockholders.
GENERAL INFORMATION
SOLICITATION OF PROXIES
A form of proxy is being furnished herewith by the Company to each
stockholder and, in each case, such proxy is solicited on behalf of the Board of
Directors of the Company for use at the Meeting. The entire cost of soliciting
these proxies will be borne by the Company. Solicitation will be made by mail,
and may also be made by telephone or facsimile by directors, officers and
regular employees of the Company, but these persons will not be separately
compensated for such solicitation services. The Company will reimburse brokerage
houses and other nominees for their expenses in forwarding proxy solicitation
material to beneficial owners of the Company's Common Stock.
AUTHORITY CONFERRED BY PROXIES
The shares represented by proxies duly executed and returned by
stockholders and received by the Company before the Meeting will be voted as
directed in the proxies. In the absence of specific direction, the shares
represented by proxies will be voted: (1) FOR the election of all nominee
directors specified herein and (2) FOR the approval of the 2000 Employee Stock
Purchase Plan. As to the other matters, if any, to be voted upon at the Meeting,
the persons designated as proxies in the accompanying form of proxy will take
such action as they, in their discretion, may deem advisable. The persons named
as proxies were selected by the Board of Directors and one is a director and
executive officer of the Company and the other is an executive officer of the
Company.
REVOCABILITY OF PROXIES
Execution of the enclosed proxy will not affect your right as a stockholder
to attend the Meeting and to vote in person. Any stockholder giving a proxy has
the right to revoke it at any time by: (i) a later dated proxy, duly executed
and delivered or presented at the Meeting; (ii) a written revocation sent to and
received by the Secretary of the Company prior to the Meeting; or (iii)
attendance at the Meeting and voting in person.
VOTING SECURITIES AND RECORD DATE
The Company's voting securities consist of one class of Common Stock, par
value $0.01 per share (the "Common Stock"), and one class of Preferred Stock,
par value $0.01 per share (the "Preferred Stock"). The Company had 7,745,644
issued and outstanding shares of Common Stock and no shares of Preferred Stock
issued and outstanding as of the close of business on April 6, 2001 (the "Record
Date"). Only stockholders of record on the books of the Company at the close of
business on the Record Date will be entitled to vote at the
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Meeting. Each share of Common Stock is entitled to one vote. Representation at
the Meeting by the holders of one-third of the shares of Common Stock
outstanding on the Record Date, either in person or by proxy, will constitute a
quorum.
Votes for, against, abstentions and "broker non-votes" will each be counted
as present for purposes of determining the presence of a quorum. The affirmative
vote by the holders of a majority of the shares present (whether in person or by
proxy) and entitled to vote, will be required to approve the 2000 Employee Stock
Purchase Plan. Accordingly, abstention have the same affect as a vote "against"
the proposal while broker non-votes do not affect the outcome. For the election
of directors, the six nominees who receive the most votes will be elected.
Accordingly, abstentions and broker non-votes will not affect the outcome of
such election.
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
The following table sets forth certain information as of April 6, 2001
(unless otherwise noted) with respect to the beneficial ownership of the
Company's issued and outstanding Common Stock by: (i) each stockholder known by
the Company to be the beneficial owner of more than 5% of its Common Stock, (ii)
each director, (iii) each executive officer named in the Summary Compensation
Table and (iv) all of the directors and executive officers of the Company as a
group.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission ("SEC") which generally attribute beneficial
ownership of securities to persons which possess sole or shared voting power
and/or investment power with respect to those securities. Unless otherwise
indicated, the persons or entities identified in the table have sole voting and
investment power with respect to the shares shown as beneficially owned by them.
Based upon the SEC definition of beneficial ownership, outstanding stock
options exercisable by the executive officers and directors within 60 days of
the Record Date are included in the number of shares owned by such individuals.
The option price on all options to purchase the Company's Common Stock was above
the market price of Common Stock at April 6, 2001.
NAME AND ADDRESS OF TOTAL SHARES PERCENT
BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
------------------- ------------------ --------
J.P. Morgan Partners (SBIC), LLC(1)......................... 1,334,521 17.2%
Samstock L.L.C.(2).......................................... 664,000 8.6
Dimensional Fund Advisors, Inc.(3).......................... 506,550 6.5
Charles R. Campbell(4)...................................... 54,261 *
Joseph Gantz(5)............................................. 29,610 *
Stephen P. Murray(6)........................................ 1,350,779 17.4
Marshall Ragir(7)........................................... 257,226 3.3
Jeffrey C. Rubenstein(8),(9)................................ 571,258 7.4
Daniel B. Shure(10)......................................... 37,372 *
Joel D. Spungin(11)......................................... 31,642 *
James R. Tennant(12)........................................ 679,442 8.5
James E. Winslow(13)........................................ 99,025 1.3
All directors and executive officers as a group (9
persons)(14).............................................. 2,879,622 35.5
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* Less than 1%
(1) J.P. Morgan Partners (SBIC), LLC ("JPMP SBIC"), is a Delaware limited
liability company whose address is 1221 Avenue of the Americas, New York,
NY 10020. JPMP SBIC is a wholly owned subsidiary of J.P. Morgan Partners
(BHCA), L.P. ("JPM BHCA"), a Delaware limited general partnership, whose
address is the same as JPMP SBIC. JPMP SBIC and JPM BHCA have shared voting
and investment power with respect to the 1,334,521 shares of Common Stock.
(2) According to information available to the Company, the address of Samstock
L.L.C. ("STK") is Two North Riverside Plaza, Suite 600, Chicago, IL 60606.
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(3) According to information contained in a report on Schedule 13G dated
February 2, 2001, filed by Dimensional Fund Advisors, Inc. ("DFA"), DFA
beneficially owns 506,550 (which represent 6.5% of the shares outstanding)
as a result of acting as an investment adviser for registered investment
companies. DFA and the various accounts to which it is an adviser have
shared power to vote and dispose of 506,550 shares of Common Stock. DFA
expressly disclaims that, it is in fact, the beneficial owner of such
shares. DFA's address is 1299 Ocean Avenue, 11th floor, Santa Monica, CA
90401.
(4) Includes 15,000 shares of Common Stock which may be purchased by Mr.
Campbell upon exercise of currently exercisable options.
(5) Includes 12,500 shares of Common Stock which may be purchased by Mr. Gantz
upon exercise of currently exercisable options and 7,580 shares of Common
Stock deferred pursuant to the Company's 1999 Directors' Restricted Stock
Plan.
(6) Mr. Murray is a general partner of JPMP SBIC, and in such capacity
exercises shared voting and investment power with respect to the shares
beneficially owned by JPMP SBIC (1,334,521 shares). Mr. Murray expressly
disclaims that he, is in fact, the beneficial owner of such shares.
Includes 12,500 shares of Common Stock which may be purchased by Mr. Murray
upon exercise of currently exercisable options and 3,758 shares of Common
Stock deferred pursuant to the 1999 Directors' Restricted Stock Plan. Mr.
Murray's address is C/O J.P. Morgan Partners (SBIC), LLC, 1221 Avenue of
the Americas, New York, NY 10020.
(7) Includes 164,000 shares of Common Stock beneficially owned by the Ragir
Foundation with respect to which Mr. Ragir, in his capacity as a director,
exercises shared voting and investment power. These shares are deemed to be
beneficially owned by Mr. Ragir pursuant to the 1934 Act. Mr. Ragir
expressly disclaims that he is, in fact, the beneficial owner of such
shares. The number of shares reported in the table also includes 66,993
shares of Common Stock beneficially owned by the Meyer J. Ragir Family
Irrevocable Trust -- Marshall Ragir Separate Trust with respect to which
Mr. Ragir, in his capacity as a co-trustee, exercises shared voting and
investment power. Does not include 15,190 shares of Common Stock
beneficially owned by the MJR/NLR Gift Trust -- Marshall Ragir Separate
Trust with respect to which Mr. Ragir does not exercise sole or shared
voting or investment power. Includes 15,000 shares of Common Stock which
may be purchased by Mr. Ragir upon exercise of currently exercisable
options and 1,805 shares of Common Stock deferred pursuant to the Company's
1999 Directors' Restricted Stock Plan.
(8) Mr. Rubenstein is the executor of the Norma L. Ragir Estate and in such
capacity exercises voting and investment power with respect to the shares
of Common Stock beneficially owned by the Norma L. Ragir Estate (221,501
shares). Mr. Rubenstein is a director of the Meyer and Norma Ragir
Foundation (the "Ragir Foundation") and in such capacity exercises shared
voting and investment power with respect to the shares of Common Stock
beneficially owned by the Ragir Foundation (164,000 shares). Mr. Rubenstein
is co-trustee of five separate trusts and, in such capacities, exercises
shared voting and investment power with respect to the shares of Common
Stock beneficially owned by the five separate trusts. The five trusts, and
the respective number of shares held by each is as follows: MJR/NLR Gift
Trust -- Judith Ragir Separate Trust (15,189 shares); MJR/NLR Gift
Trust -- Robert Ragir Separate Trust (13,985 shares); MJR/NLR Gift
Trust -- Marshall Ragir Separate Trust (15,190 shares) (collectively, the
"Ragir Gift Trusts"); the Meyer J. Ragir Family Irrevocable Trust -- Judith
Ragir (16,500 shares); and the Meyer J. Ragir Family Irrevocable
Trust -- Marshall Ragir Separate Trust (66,993 shares) (collectively, the
"Ragir Family Trusts"). All five trusts are collectively referred to herein
as the "Ragir Trusts". None of the Ragir Trusts individually owns more than
1% of the Common Stock of the Company. Mr. Rubenstein, as executor of the
Norma L. Ragir Estate and a director of the Ragir Foundation and co-trustee
of the Ragir Trusts, exercises either sole or shared voting and investment
power with respect to 513,358 shares of Common Stock (which represent 6.6%
of the outstanding shares). Mr. Rubenstein expressly disclaims that he is,
in fact, the beneficial owner of all such shares. The address for Mr.
Rubenstein is 200 North LaSalle Street, Suite 2100, Chicago, IL 60601.
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(9) Includes 15,000 shares of Common Stock which may be purchased by Mr.
Rubenstein upon exercise of currently exercisable options. Also includes
1,000 shares held by Mr. Rubenstein's wife with respect to which Mr.
Rubenstein disclaims beneficial ownership.
(10) Includes 15,000 shares of Common Stock which may be purchased by Mr. Shure
upon exercise of currently exercisable options and 9,071 shares of Common
Stock deferred pursuant to the Company's 1999 Directors' Restricted Stock
Plan. Also includes 2,500 shares held by Mr. Shure's children with respect
to which Mr. Shure disclaims beneficial ownership.
(11) Includes 15,000 shares of Common Stock which may be purchased by Mr.
Spungin upon exercise of currently exercisable options and 11,602 shares of
Common Stock deferred pursuant to the Company's 1999 Directors' Restricted
Stock Plan.
(12) Includes 200,100 shares of Common Stock which may be purchased by Mr.
Tennant upon exercise of currently exercisable options. Includes 373,333
restricted shares of Common Stock and 9,347 shares subject to the Company's
Executive Incentive Plan.
(13) Includes 20,100 shares of Common Stock which may be purchased by Mr.
Winslow upon exercise of currently exercisable options. Includes 54,167
restricted shares of Common Stock and 3,445 shares subject to the Company's
Executive Incentive Plan.
(14) Includes 320,200 shares of Common Stock which may be purchased upon
exercise of currently exercisable options, 427,500 restricted shares of
Common Stock, 12,792 shares subject to the Company's Executive Incentive
Plan and 33,816 shares of Common Stock deferred pursuant to the Company's
1999 Directors' Restricted Stock Plan.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The By-Laws of the Company provide that the Board of Directors shall
consist of six directors to be elected at the annual meeting of stockholders to
hold office until the next annual meeting or until their successors are elected
and qualified. The proxies solicited by and on behalf of the Board of Directors
will be voted FOR the election of the six nominees listed below, unless
authority to do so is withheld as provided in the proxy. All nominees have
served as directors since the last annual meeting. The proxies cannot be voted
for a greater number of persons than the number of nominees named. If for any
reason one or more of the nominees should be unable to serve or refuse to serve
as a director (an event which is not anticipated), the persons named as proxies
will vote for another candidate or candidates nominated by the Board of
Directors, and discretionary authority to cast such votes is included in the
proxy. The nominees receiving the highest number of votes of shares of Common
Stock, up to the number of directors to be elected, shall be elected.
NOMINEES FOR DIRECTORS
Information regarding the Board's nominees for election as directors is set
forth below.
Charles R. Campbell, age 61, has been a director of the Company since
September, 1994. Since 1996 Mr. Campbell has been a principal with the Everest
Group, a management consulting firm. From 1995 to 1996 Mr. Campbell was
President of C. R. Campbell & Associates, a management consulting firm. From
1985 to 1995, Mr. Campbell was Senior Vice President, Chief Financial and
Administrative Officer of Federal Signal Corporation, a diversified manufacturer
of capital goods.
Marshall Ragir, age 56, has been a director of the Company since July,
1995. Since 1991, Mr. Ragir has been President and Chief Executive Officer of
Know Business Inc., a venture capital and investment company. Mr. Ragir is a
director of several charitable foundations and non-profit agencies.
Jeffrey C. Rubenstein, age 59, has been a director of the Company since
September, 1986. Since 1991, Mr. Rubenstein has been a senior principal with the
law firm of Much Shelist Freed Denenberg Ament &
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Rubenstein, P.C., an Illinois professional corporation, which is counsel to the
Company. Mr. Rubenstein is a director of Vita Food Products, Inc. and a number
of privately held companies.
Daniel B. Shure, age 43, has been a director of the Company since December,
1994. Since 1988, Mr. Shure has been President and Chief Executive Officer of
Strombecker Corporation, an international toy manufacturer and distributor. Mr.
Shure is a director of several privately held companies.
Joel D. Spungin, age 63, has been a director of the Company since
September, 1996. Since 1995, Mr. Spungin has been President of DMS Enterprises,
a management advisory and investment company. Mr. Spungin has been Chairman
Emeritus of United Stationers, Inc. since 1994. From 1981 to 1995, Mr. Spungin
was employed by United Stationers, Inc., in various capacities with his final
position being Chairman of the Board and Chief Executive Officer. Mr. Spungin is
a director of AAR Corporation, Vita Food Products, Inc. and a number of
privately held companies.
James R. Tennant, age 48, joined the Company as Chairman of the Board and
Chief Executive Officer in April, 1994. Mr. Tennant was elected a director of
the Company in December, 1992, and was a member of the Company's Compensation
Committee until April, 1994. From 1982 to 1994, Mr. Tennant was Division
President of True North Communications, an international marketing services
company. Mr. Tennant is a director of Hines Horticulture, Inc. and a number of
privately held companies.
BOARD AND COMMITTEES MEMBERSHIP
The Board of Directors met five times during the 2000 fiscal year and had
three ongoing committees. Those committees consisted of an Audit Committee, an
Executive Compensation Committee and a Nominating Committee. All of the
directors attended at least 75% of the meetings of the Board of Directors and
the committees on which they served.
The table below provides membership and meeting information for each of the
Board committees in fiscal 2000.
EXECUTIVE
NAME AUDIT COMPENSATION NOMINATING
- ---- ----- ------------ ----------
Charles R. Campbell......................................... X*
Joseph Gantz................................................ X X
Stephen P. Murray...........................................
Marshall Ragir.............................................. X
Jeffrey C. Rubenstein....................................... X X
Daniel B. Shure............................................. X
Joel D. Spungin............................................. X*
James R. Tennant............................................ X*
2000 Meetings............................................... 2 4 0
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* Committee Chairman
THE AUDIT COMMITTEE
The Audit Committee oversees the activities of the Company's independent
auditors. The Committee:
- Reviews with the outside auditors the scope of the audit, the auditor's
fees and related matters;
- Receives copies of the annual comments from the independent auditors on
accounting procedures and systems of control; and
- Reviews with the independent auditors any questions, comments or
suggestions they may have relating to our internal controls, accounting
practices and procedures and those of the Company's subsidiaries.
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THE EXECUTIVE COMPENSATION COMMITTEE
The Executive Compensation Committee is responsible for establishing annual
and long-term performance goals for the Executive Officers. This responsibility
includes establishing the compensation package and evaluating the performance of
the Chairman and Chief Executive Officer, and the Chief Financial Officer. In
addition, the Committee:
- Recommends the granting of options and awards under the various stock
option plans; and
- Publishes an annual Executive Compensation Committee Report for the
stockholders.
THE NOMINATING COMMITTEE
The Nominating Committee is responsible for recommending candidates for
membership on the Board of Directors and consulting with the Chairman on
committee assignments. The Nominating Committee will not consider nominees
recommended by security holders.
COMPENSATION OF DIRECTORS
All non-employee directors will receive an annual retainer of $7,500
payable in Common Stock. The number of shares to be received by each
non-employee director will be based upon the closing price per share of the
Common Stock as reported on The NASDAQ SmallCap Market(sm) on the day of the
Meeting. Non-employee directors will receive a fee of $1,750 for each Board of
Directors' meeting attended and $500 for each committee meeting attended. All
non-employee directors that chair a committee will receive an annual fee of
$2,500. Each non-employee director has had, prior to the date hereof, the option
to receive these fees in cash or in Common Stock. If a non-employee director
elected to receive Common Stock, the number of shares to be received is based
upon the closing price per share of the Common Stock as reported on The NASDAQ
SmallCap Market(sm) on the day of the Board of Directors' meeting or the
committee meeting. Each non-employee director may defer payment of the retainer
and/or director's pursuant to the Directors' Restricted Stock Plan, until
termination of the director's services or the attainment of a certain age. Non-
employee directors will also be granted options to purchase shares of Common
Stock at the discretion of the Board of Directors upon consideration of
recommendations of the Compensation Committee. All of the stock options granted
to the non-employee directors will be at an exercise price equal to the closing
price per share as reported on The NASDAQ SmallCap Market(sm) on such date and
will become exercisable immediately.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS VOTING "FOR" THE
ELECTION OF THE NOMINEES SET FORTH HEREIN.
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COMPENSATION OF EXECUTIVE OFFICERS
The following table discloses the compensation awarded by the Company for
services rendered during the Company's last three fiscal years to the chief
executive officer and to the other named executive officer (collectively, the
"Named Executive Officers") as of December 30, 2000.
SUMMARY COMPENSATION TABLE
LONG TERM
COMPENSATION
----------------------------------
RESTRICTED
ANNUAL COMPENSATION STOCK SECURITIES LTIP ALL OTHER
-------------------- AWARD UNDERLYING PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($)(1) OPTIONS# ($)(2) ($)
--------------------------- ---- --------- -------- ---------- ---------- ------- ------------
James R. Tennant................. 2000 $430,000 $ 0 $594,999 0 $ 12,268 $64,425(3)
Chairman of the Board and Chief 1999 391,758 341,691 0 225,000 115,013 69,759(3)
Executive Officer of HPI 1998 350,000 382,884 0 0 0 9,476(3)
James E. Winslow................. 2000 $215,000 $ 0 $ 86,329 0 $ 4,522 $29,299(4)
Executive Vice President, Chief 1999 205,000 162,522 0 35,000 42,396 32,710(4)
Financial Officer and Secretary 1998 205,000 164,652 0 0 0 9,476(4)
of HPI
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(1) The shares represented by the restricted stock award are subject to a
forfeiture restriction in the event that Messrs. Tennant and Winslow
voluntarily leave the Company or are terminated for cause prior to the date
the restriction lapses. The restriction on the shares will lapse in October
2003. The number of restricted shares held by Mr. Tennant at the end of 2000
was 373,333 and the value of such shares at the end of last year was
$653,333. The number of restricted shares held by Mr. Winslow at the end of
2000 was 54,167 and the value of such shares at the end of last year was
$94,792.
(2) The amounts appearing in this column are the December 30, 2000 and December
25, 1999 payout of the Share Units converted to Common Stock pursuant to the
Company's Executive Incentive Plan ("EIP") as well as the cash paid out upon
the conversion of such share units.. The 2000 payout values were calculated
by multiplying the closing price of the Company's Common Stock as of the
last trading date of the Company's fiscal year 2000 (December 29, 2000) of
$1.750/share by a certain number of share units. Mr. Tennant payout was
based on 7,010 share units and Mr. Winslow payout was based on 2,584 share
units. The 1999 payout values were calculated by multiplying the closing
price of the Company's Common Stock as of the last trading date of the
Company's fiscal year 1999 (December 23, 1999) of $10.938/share by a certain
number of share units. Mr. Tennant payout was based on 10,515 shares units
and Mr. Winslow payout was based on 3,876 share units. The 2000 payout was a
result of prior year awards.
(3) Consists in 1998 of an employer contribution of $9,476 to Mr. Tennant's
Profit Sharing and 401(K) Plan and Trust maintained by the Company (the
"401(K)"). Consists in 1999 of an employer contribution of $9,800 to Mr.
Tennant's 401(K), an employer contribution of $38,341 to Mr. Tennant's
non-qualified deferred compensation plan maintained by the Company (the
"Deferred Compensation Plan") and the Company's payment of $21,618 in life
and disability insurance premiums on Mr. Tennant's behalf. Consists in 2000
of an employer contribution of $10,350 to Mr. Tennant's 401(K), an employer
contribution of $40,772 to Mr. Tennant's Deferred Compensation Plan and the
Company's payment of $13,303 in life and disability insurance premiums on
Mr. Tennant's behalf.
(4) Consists in 1998 of an employer contribution of $9,476 to Mr. Winslow's
401(K). Consists in 1999 of an employer contribution of $9,800 to Mr.
Winslow's 401(K), an employer contribution of $14,996 to Mr. Winslow's
Deferred Compensation Plan and the Company's payment of $7,914 in life and
disability insurance premiums on Mr. Winslow's behalf. Consists in 2000 of
an employer contribution of $10,350 to Mr. Winslow's 401(K), an employer
contribution of $14,079 to Mr. Winslow's Deferred Compensation
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Plan and the Company's payment of $4,870 in life and disability insurance
premiums on Mr. Winslow's behalf.
STOCK OPTION GRANTS IN 2000
The following table provides information on option grants in fiscal 2000 to
the Named Executive Officers.
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
--------------------------------------------------- VALUE AT ASSUMED
NUMBER OF PERCENTAGE OF ANNUAL RATES OF STOCK
SECURITIES TOTAL OPTIONS PRICE APPRECIATION FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM
OPTIONS EMPLOYEES IN PRICE EXPIRATION -----------------------
GRANTED FISCAL YEAR ($/SHARE) DATE 5% 10%
---------- ------------- --------- ---------- -- ---
James R. Tennant.............. -- -- -- -- -- --
James E. Winslow.............. -- -- -- -- -- --
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table provides information on option exercises in fiscal 2000
by the Named Executive Officers and the value of such officers' unexercised
options at December 30, 2000.
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY(1)
SHARES OPTIONS AT OPTIONS AT
ACQUIRED FISCAL YEAR-END FISCAL YEAR-END
ON VALUE --------------------------- ----------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------- -------- ----------- ------------- ----------- -------------
James R. Tennant.......... -- -- 200,100 -- -- --
James E. Winslow.......... -- -- 16,767 8,333 -- --
- -------------------------
(1) "In-The-Money" options are options whose base (or exercise) price was less
than the market price of Common Stock at December 29, 2000.
EMPLOYMENT AGREEMENTS
James R. Tennant is employed as Chairman of the Board and Chief Executive
Officer of the Company pursuant to an employment agreement dated as of May 19,
1999. Such employment agreement expires on December 31, 2003, with automatic one
year extensions thereafter unless canceled by either party. The employment
agreement provides for an annual base salary of $400,000. Mr. Tennant is also
entitled to receive a discretionary bonus based on the Company's financial
performance (in the form of cash and/or stock options at the discretion of the
Board of Directors), as well as to receive incentive bonuses subject to the
terms of the EIP and the Company's Management Incentive Plan. If the Company
terminates Mr. Tennant's employment without cause or does not renew Mr.
Tennant's employment agreement for any renewal year after December 31, 2003, Mr.
Tennant will be entitled to receive a severance payment in an amount equal to
three times the average salary and bonus earned during the two years immediately
prior to the termination. If Mr. Tennant's employment is terminated for any
reason within 180 days after a change in control of the Company, Mr. Tennant is
entitled to receive (i) payments over a twenty-four month period following the
termination in an amount equal to the difference between (A) five million and
(B) the per share value of the Company's Common Stock at the closing of the
event which is the culmination of the transaction(s) resulting in the change of
control minus the exercise price per share of each stock option granted to Mr.
Tennant prior to the change in control multiplied by the number of shares of the
Company's common stock underlying each option granted and (ii) a one time
payment equal to the product of (A) three times (B) the sum of the amount of
salary and bonus earned during each of the two years immediately prior to the
termination divided by two. Mr. Tennant's employment agreement also provides for
the granting of certain options to purchase Common Stock. Mr. Tennant's
employment agreement also contains a provision to reimburse him for any excise
tax that may be due under section 4999 of the Internal Revenue Code of 1986, as
amended, as well as any additional income or other tax which may become due
because of this additional payment. He also agrees
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not to compete against the Company or solicit its customers or employees for a
period of three years after his voluntary termination or termination by the
Company without cause.
The Company has entered into an employment agreement with Mr. Winslow. If
Mr. Winslow's employment is terminated by the Company for any reason (other than
for cause, death or disability), he is entitled to a severance payment equal to
the average yearly salary and bonus compensation paid to such executive over the
past two fiscal years.
RETENTION AGREEMENT
The Company has entered into a Retention and Non-Competition Agreement with
Mr. Winslow. The agreement provides that if Mr. Winslow remains with the Company
for 180 days following a change in control of the Company, or is terminated
without cause or dies before the end of such period, such executive will receive
a payment equal to the average yearly salary and bonus compensation paid to such
executive over the past two fiscal years. Additionally, such executive agrees
that he will not compete against the company or solicit its customers or
employees for a period of one year after the termination of his employment with
the Company, and the Company agrees to pay Mr. Winslow $100,000 upon a change in
control in consideration for such agreements.
RESTRICTED STOCK AGREEMENT
In 2000 the Board of Directors of the Company offered Messrs. Tennant and
Winslow the option to cancel certain outstanding stock options and convert such
canceled options into restricted stock of the Company pursuant to a Restricted
Stock Agreement (the "Agreement"). Under the Agreement, Messrs. Tennant and
Winslow have elected to cancel 830,000 and 115,000 options to purchase the
Company's Common Stock, respectively. Under the Agreement, 373,333 and 54,167
shares of the Company's Common Stock were issued as restricted stock to Messrs.
Tennant and Winslow, respectively. The restriction on the shares will lapse in
October 2003. All shares are subject to forfeiture in the event that the
employee voluntarily leaves the Company or is terminated for cause prior to the
date the restriction lapses.
COMPENSATION COMMITTEE REPORT
The report of the Compensation Committee and the performance graph included
elsewhere in this proxy statement shall not be deemed incorporated by reference
by any general statement incorporating by reference this Proxy Statement into
any filings under either the 1933 Act or the 1934 Act (together, the "Acts"),
except to the extent that the Company specifically incorporates such report or
graph by reference; and further, such report and graph shall not be deemed filed
under the Acts.
The Compensation Committee ("Committee") determines and administers the
compensation of the Company's executive officers. The Committee is comprised
entirely of non-employee directors.
COMPENSATION PHILOSOPHY
At the direction of the Board of Directors and pursuant to the charter of
the Committee, the Committee endeavors to ensure that the compensation programs
for executive officers of the Company are effective in attracting and retaining
key executives responsible for the success of the Company and are administered
in an appropriate fashion in the long-term interests of the Company. The
Committee actions related to the compensation of the chief executive officer of
the Company and the chief financial officer of the Company are submitted to the
full Board of Directors for ratification.
The Committee believes that the Company's overall financial performance
should be an important factor in the total compensation of the Company's
executive officers. At the executive officer level, the Committee has a policy
that a significant portion of the total compensation should consist of variable,
performance-based components, such as stock awards and bonuses, which can
increase or decrease to reflect changes in corporate and individual
performances. These incentive compensation programs are intended to reinforce
management's commitment to enhancement of profitability and stockholder value.
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The Committee takes into account various qualitative and quantitative
indicators of Company and individual performance in determining the level and
composition of compensation for the chief executive officer and other executive
officer(s). While the Committee considers such Company performance measures as
net income, earnings per share, return on average stockholders' equity, return
on capital employed and return on average total assets, the Committee does not
apply any specific quantitative formula in making compensation decisions.
However, the Executive Incentive Plan and the Management Incentive Plan are
based on specific Company performance measures of return on capital employed and
the attainment of certain budgeted goals, respectively. The Committee also
appreciates the importance of achievements that may be difficult to quantify
and, accordingly, recognizes qualitative factors, such as successful supervision
of major corporate projects, demonstrated leadership ability and contributions
to the industry. From time to time, the Committee also receives assessments and
advice regarding the Company's compensation practices from independent
compensation consultants.
BASE SALARY
Base salaries for the chief executive officer and other executive
officer(s) are established at levels considered appropriate in light of the
duties and scope of responsibilities of each executive officer's position.
Salaries are reviewed periodically and adjusted as warranted to reflect
sustained individual executive officer's performance. The Committee focuses
primarily on total annual compensation, including incentive awards, rather than
base salary alone, as the appropriate measure of executive officer performance
and contribution.
PERFORMANCE BASED COMPENSATION
EXECUTIVE INCENTIVE PLAN. The Executive Incentive Plan ("EIP") applies to
the Company's senior management. The purpose of the EIP is to make available to
the participants, a portion of their total compensation in the form of an
incentive opportunity when they discharge their duties in a manner which makes a
measurable contribution to the Company's earnings and achieves a predetermined
return on capital employed goal. While the EIP provides annual incentive
opportunity, it also focuses on long-term results.
MANAGEMENT INCENTIVE PLAN. The Management Incentive Plan, ("MIP") applies
to executive officers and key employees of the Company. Participants are
eligible to earn an annual incentive award based on the attainment of
pre-approved Company and subsidiary goals. Participants are assigned a target
incentive award stated as a percent of their salary, based on a participant's
duties and responsibilities. The target incentive award is calculated at the end
of the fiscal year based upon the attainment of predetermined goals.
STOCK OPTIONS
In recommending grants under the various stock option plans, the Committee
considers various quantitative and qualitative factors. The number of options
previously awarded to and held by executive officers and key employees is
reviewed but is only one factor in determining the size of current option
grants.
CHIEF EXECUTIVE OFFICER COMPENSATION
Compensation of the Chief Executive Officer for the 2000 fiscal year was
determined pursuant to the terms of Mr. Tennant's employment agreement. Mr.
Tennant also participates in the Executive Incentive Plan for senior management
as well as the Management Incentive Plan.
COMPENSATION COMMITTEE
Joel Spungin, Chairman
Marshall Ragir
Jeffrey C. Rubenstein
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AUDIT COMMITTEE REPORT
The Audit Committee Report that follows shall not be deemed to be
incorporated by reference into any filing made by the Company under the
Securities Act of 1933 or the Securities Exchange Act of 1934, notwithstanding
any general statement contained in any such filing incorporating this proxy
statement by reference, except to the extent the Company incorporates such
Report by specific reference.
The Audit Committee of the Board of Directors has:
- Reviewed and discussed with management the Company's audited financial
statements as of and for the fiscal year ended December 30, 2000;
- Discussed with Arthur Andersen LLP, the Company's independent auditor,
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;
- Received and reviewed the written disclosures and the letter from Arthur
Andersen LLP required by Independence Standard No. 1, Independence
Discussions with Audit Committees, as amended, by the Independence
Standards Board, and has discussed with Arthur Andersen LLP its
independence.
In reliance on the review and discussions referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended December 30, 2000.
AUDIT COMMITTEE
Charles R. Campbell, Chairman
Jeffrey C. Rubenstein
Joseph Gantz
OTHER AUDITOR RELATED MATTERS
During 2000, the Company retained its independent auditor, Arthur Andersen,
to provide services in the following categories and amounts:
Audit Fees.................................................. $195,000
Financial Information Systems Design and Implementation
Fees...................................................... $293,000
All Other Fees.............................................. $150,400
The Audit Committee has considered whether the provision of non-audit
services by the Company's independent auditor is compatible with maintaining
auditor independence.
The Company's Board of Directors has adopted an Audit Committee Charter, a
copy of which is attached hereto as Appendix A. Each of the members of the Audit
Committee is independent (as independence is defined in Rule 4200(a)(15) of the
National Association of Securities Dealers' listing standards).
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COMPANY STOCK PERFORMANCE
The following graph compares the cumulative total return on the Company's
Common Stock with the cumulative total return on the NASDAQ Stock Market and a
selected industry index (SIC code 3089 -- Plastics Products N.E.C.). The graph
is for a period of five years and assumes $100 was invested on December 30,
1995. Cumulative total return assumes that dividends, if any, were reinvested.
The cumulative total return set forth in the graph is not necessarily indicative
of future returns.
ASSUMES $100 INVESTED ON DEC. 30, 1995
ASSUMES DIVIDENDS REINVESTED
FISCAL YEAR ENDING DEC. 30, 2000
[PERFORMANCE GRAPH]
12/30/95 12/28/96 12/27/97 12/26/98 12/25/99 12/30/00
-------- -------- -------- -------- -------- --------
Home Products......................... $100.00 $146.67 $208.89 $176.67 $184.44 $ 31.11
SIC Code Index........................ 100.00 134.29 165.59 164.76 175.55 191.73
NASDAQ Stock Market................... 100.00 123.04 150.69 212.51 394.94 237.68
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PROPOSAL NO. 2
APPROVAL OF THE 2000 EMPLOYEE STOCK PURCHASE PLAN
The Board of Directors has unanimously adopted the 2000 Employee Stock
Purchase Plan (the "Plan"), subject to stockholder approval at the Meeting. The
purpose of the Plan is to encourage and facilitate the purchase of Common Stock
by eligible employees of the Company in order to provide a further incentive for
eligible employees to promote the best interests of the Company and an
additional opportunity to participate in the Company's economic progress.
The following is a brief description of the material features of the Plan.
Such description is qualified in its entirety by reference to the full text of
the Plan set forth in Appendix B to this Proxy Statement.
GENERAL DESCRIPTION OF THE 2000 EMPLOYEE STOCK PURCHASE PLAN
Administration. The Plan shall be administered by the Plan committee
(hereinafter referred to as the "Committee"), the members of which shall be at
least two individuals selected by the Board. Subject to the express provisions
thereof, the Committee will have complete authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it and to make
all other determinations necessary or advisable for the administration of the
Plan.
Shares Subject to Plan. The maximum number of shares which will be
available for purchase under the Plan is 500,000 shares of Common Stock. The
shares to be sold under the Plan may at the election of the Company be either
treasury shares or shares originally issued for such purpose.
Eligibility for Participation. Any employee of the Company or its
subsidiaries will be eligible to participate in the Plan after the employee
attains at least six (6) months of continuous service except for those employees
covered under a union collective bargaining agreement, however, no employee will
be entitled to participate in the Plan if such employee would own shares
(including shares which may be purchased under the Plan) possessing five percent
(5%) or more of the total combined voting power of value of all outstanding
classes of stock of the Company.
Employees who elect to participate in the Plan do so by means of payroll
deduction. Such elections notify the Company of the amount of the payroll
deduction authorized by the employee for the Purchase Period (the period between
each June 30 and the next December 31 each of June 30 and December 31 being a
"Purchase Date") and each succeeding Purchase Period until the next Purchase
Date. A employee may discontinue his election at any time, effective the first
day of the next payroll period. If an employee discontinues his participation
prior to the last day of the last payroll period in a Purchase Period, such
employee is not eligible to participate in the Plan during the Purchase Period
immediately following his date of discontinuance. Thereafter, the employee may
elect to commence participation effective as of the first day of the first
payroll period beginning on any subsequent January 1 or July 1. An employee may
change the percentage amount of his election effective as of the first day of
the first payroll beginning on or after the next January 1 or July 1. As of
April 6, 2001, approximately 967 employees were eligible to participate in the
Plan.
An employee's purchases under the Plan may not be less that 2% or more than
12% percent of his or her salary and no employee may purchase Common Stock under
the Plan during any one calendar year with an aggregate fair market value of
more than $25,000.
Termination of Employment. Upon termination of employment, death or upon an
election by an employee to discontinue contributions, the number of Common Stock
shares paid for in full by the employee upon the application of all accumulated
payroll deductions, including from compensation due and owing, will be purchased
for the employee unless the employee (or, in the case of the Participant's
death, his designated beneficiary or estate, as the case may be) elects to
abandon all or any such number of the shares pursuant to any rules or
regulations the Committee shall make.
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Amendment. The Board may at any time, and from time to time, amend the Plan
in any respect, except that, without the approval of the stockholders of the
Company, no amendment may be made that changes the number of shares to be
reserved under the Plan.
Termination of Plan. The Board may terminate the Plan at any time in its
discretion. Upon any merger or consolidation of the Company in which the Company
is not the surviving entity or the sale or other transfer of all or
substantially all of the Company's assets, after the effective date of the
merger, consolidation or sale, (i) subject to clause (ii) below, each employee
holding a right to purchase shares will be entitled to receive, upon his payment
for all or part of the shares of Common Stock purchasable by him under the Plan,
in lieu of Common Stock, shares of such stock or other securities as the holders
of Common Stock received pursuant to the terms of the merger, consolidation or
sale and (ii) all outstanding rights to purchase may be canceled by the Board of
Directors provided that (a) notice of such cancellation is given to each
employee and (b) each employee has the right to purchase, during the 30 day
period prior to the effective date of the merger, consolidation or sale, all or
any number of shares that would be allocated to him under the terms of the Plan
if the purchase Date were set 30 days preceding said effective date.
FEDERAL INCOME TAX CONSEQUENCES
General. The Plan is not qualified under Section 401(a) of the Internal
Revenue Code of 1986, as amended (the "Code").
The following is a brief summary of the Federal income tax aspects of
shares to be issued under the Plan based upon the Code and other statutes,
regulations and interpretations in effect on the date of this Proxy Statement.
Status of Rights to Purchase Shares Under the Plan. For tax purposes,
rights to purchase shares of Common Stock under the Plan are intended to qualify
as employee stock purchase plan options as defined in Section 423 of the Code.
Tax Consequences of Grant of Right to Purchase Shares Under the Plan. An
employee's payroll deductions to purchase shares of Common Stock are made on an
after-tax-basis. No federal income tax is imposed on an employee upon the grant
of a right to purchase shares under the Plan. The Company is not entitled to a
business expense deduction as a result of the grant of a right to purchase
shares.
Tax Consequences of a Qualifying Disposition of Shares. If an employee
disposes of shares of Common Stock acquired under the Plan (including by way of
gift) more than the later of two years after the granting of the option or 12
months after the date of acquisition of the shares, typically at the end of the
Plan year or dies while owning any such shares, any gain is first recognized as
ordinary income up to the lesser of (i) the excess of the fair market value of
shares at the time of disposition over the purchase price of such shares, or
(ii) the excess of the fair market value of shares at the date the employee made
the election to purchase the shares over the purchase price. The employee's
basis in shares of Common Stock acquired under the Plan is increased by any
ordinary income recognized. Any remaining gain upon disposition is recognized as
a long-term capital gain. If the employee disposes of shares of Common Stock
acquired under Plan after meeting the above statutory holding period for less
than the purchase price, a long-term capital loss is recognized.
If an employee satisfies the long-term capital gain holding period
requirements discussed above, then the Company will not be allowed a deduction
with respect to the employee's disposition of the shares.
Tax Consequences of Disqualifying Disposition. If an employee disposes of
shares of Common Stock acquired under the Plan before meeting the statutory
holding period, then the employee would be treated as having received, at the
time of disposition, compensation taxable as ordinary income. The amount
recognized as ordinary income upon such disposition is the difference between
the purchase price and the fair market value of the shares at the applicable
Purchase Date. The difference between the basis (the purchase price) of the
shares of Common Stock acquired under the Plan, increased by any ordinary income
recognized, and the selling price of shares of Common Stock acquired under the
Plan is a short-term capital gain or loss. In such event, as long as any
applicable withholding obligations are satisfied, the Company may claim a
deduction for
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compensation paid at the same time and in the same amount as the ordinary income
recognized by the employee.
VOTE REQUIRED FOR APPROVAL
Approval of the Plan requires the affirmative vote of the holders of a
majority of the shares of Common Stock of the Company present at the Meeting, in
person or by proxy, and entitled to vote.
THE COMPANY'S BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR APPROVAL
OF THE 2000 EMPLOYEE STOCK PURCHASE PLAN.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Jeffrey C. Rubenstein, a director of the Company, and a member of the
Compensation Committee is a senior principal with the law firm Much Shelist
Freed Denenberg Ament & Rubenstein, P.C., which serves as general counsel to the
Company. Legal fees paid to Mr. Rubenstein's firm were neither material to the
Company or to his firm. Mr. Rubenstein, as executor of the Meyer J. Ragir
Estate, executor of the Norma L. Ragir Estate, a director of the Ragir
Foundation, and co-trustee of the Ragir Trusts, exercises either sole or shared
voting and investment power with respect to 513,358 shares of the Company's
Common Stock, or 6.6% of the outstanding shares of Common Stock as of April 6,
2001 and Mr. Rubenstein beneficially owned an additional 57,900 shares as of
that date. The Company's principal office and a manufacturing facility in
Chicago, Illinois is owned by the Ragir Gift Trust, of which Mr. Rubenstein
serves as co-trustee.
INDEPENDENT ACCOUNTANTS
The Board of Directors of the Company has appointed Arthur Andersen LLP,
independent public accountants, as independent auditors to examine the annual
consolidated financial statements of the Company and its subsidiary companies
for 2001. Arthur Andersen LLP has served as the Company's independent auditors
since 1996. A representative of Arthur Andersen LLP will be present at the
meeting to make a statement, if such representative so desires, and to respond
to stockholders' questions.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who beneficially own
more than 10% of the Company's Common Stock, to file with the SEC initial
reports of beneficial ownership ("Form 3") and reports of changes in ownership
of the Company's Common Stock and other equity securities of the Company ("Form
4"). Executive officers, directors, and greater than 10% stockholders of the
Company are required by SEC regulations to furnish the Company with copies of
all Section 16(a) reports that they file.
Based solely on review of the copies of such reports furnished to the
Company, the Company believes that during the 2000 fiscal year, all Section
16(a) filing requirements applicable to directors, executive officers and
greater than 10% beneficial owners were complied with except as follows: (i)
each of Messrs. Tennant (chief executive officer), Winslow (executive officer)
and Dolan (former executive officer) filed one late Form 4 reporting units
acquired under the EIP and options granted to them beginning in 1995 which had
not been previously reported under Section 16(a) (Mr. Tennant's Form 4 also
included late reporting of two open market purchases of Common Stock in 2000);
(ii) each of Messrs. Tennant and Winslow filed one late Form 5 reporting the
conversion of units acquired under the EIP to Common Stock and cash in 2000; and
(iii) each of the non-employee directors, including Messrs. Campbell, Gantz,
Murray, Ragir, Rubenstein and Spungin filed one late Form 4 to report shares of
Common Stock and options granted to them as compensation for their services as
directors since 1995 which had not been previously reported under Section 16(a)
(Mr. Spungin's Form 4 also included late reporting of a gift of shares) and one
late Form 5 reporting the acquisition of shares of Common Stock as compensation
for their services as directors in the latter half of 2000.
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ANNUAL REPORT
A copy of the Company's Annual Report to Stockholders has accompanied this
Proxy Statement. The Company's Annual Report on Form 10-K for the fifty-three
weeks ended December 30, 2000, as filed with the SEC, is available without
charge to any stockholder upon written request to James E. Winslow, Executive
Vice President, Chief Financial Officer and Secretary, Home Products
International, Inc., 4501 West 47th Street, Chicago, Illinois 60632. Copies of
exhibits filed with the Form 10-K will be furnished, if requested, upon payment
of the Company's reasonable expenses in furnishing those materials.
STOCKHOLDER PROPOSALS
Stockholder proposals submitted for evaluation as to inclusion in the proxy
materials for the Company's next annual meeting of stockholders must be received
by the Company not later than 5:00 pm central standard time on December 19,
2001, at the Company's principal executive offices at 4501 West 47th Street,
Chicago, Illinois 60632. With respect to the Meeting, proxies appointed by
management will use their discretionary authority to vote the shares they
represent as the Board of Directors may recommend when a stockholder raises any
proposal which is not included in these proxy materials for consideration at the
Meeting if the Company did not receive proper notice of such proposal at its
principal executive offices by December 13, 2001. Proxies appointed by
management will use their discretionary authority to vote the shares they
represent as the Board of Directors may recommend at the Company's annual
meeting of stockholders to be held in 2002 if a stockholder raises any proposal
which is not included in the proxy materials for such meeting and the Company
does not receive proper notice of such proposal at its principal executive
offices by December 19, 2001.
OTHER MATTERS
Management is not aware of any other matters to be presented for action at
the Meeting. If any other matters are properly brought before the Meeting, it is
the intention of the persons named as proxies in the accompanying form of proxy
to vote the shares represented thereby in accordance with their best judgment.
For the Board of Directors,
/S/ JAMES R. TENNANT
James R. Tennant
Chairman of the Board
Chicago, Illinois
April 11, 2001
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APPENDIX A
HOME PRODUCTS INTERNATIONAL INC.
AUDIT COMMITTEE CHARTER
MISSION STATEMENT, ROLES AND RESPONSIBILITIES
The Audit Committee ("Committee") will assist the board of directors of
Home Products International, Inc. (the "Company") in fulfilling its oversight
responsibilities. The Committee will review the financial reporting process, the
system of internal control, the audit process, and the Company's process for
monitoring compliance with laws and regulations and with the Company's Code of
Conduct. In performing its duties, the Committee will maintain effective working
relationships with the Company's board of directors, management, and the
external independent public accountant auditors ("External Auditors") and
internal auditors, if any. To effectively perform his or her role, each
Committee member will obtain an understanding of the responsibilities of
Committee membership as well as the Company's business, operations and risks.
I. ORGANIZATION
A. The Committee shall consist of three (3) or more members to be selected
by the Company's board of directors.
B. All of the members shall be "independent directors" or qualify under
the exceptions thereto, as such are described by the NASD rule making
dated December 14, 1999, as amended from time to time. The board of
directors shall certify and appoint one (1) member who possesses the
requisite financial sophistication to be Chairman of the Committee. All
members of the Committee shall be able to read and understand
fundamental financial statements, including the Company's balance
sheets, income statements and cash flow statements.
C. The Committee shall meet not less frequently than: a meeting prior to
the initiation of the audit of the Company's fiscal year statements; a
meeting following the Company's independent auditors' preparation of
the Company's fiscal year financial statements; and meetings at such
other times as deemed necessary for either the Company's board of
directors or the Chairman of the Committee.
II. ROLES AND RESPONSIBILITIES
A. Financial Reporting:
1. General Responsibilities of the Committee:
a) Review significant accounting and reporting issues, problems or
difficulties raised by the External Auditors and any management
letter provided by the External Auditors, as well as
management's response to such letter;
b) Inquire of management, External Auditors and internal auditors,
if any, about significant risks and exposures and the plans to
minimize such risks.
2. Annual Financial Statements, with respect thereto, the Committee
shall:
a) Review the annual financial statements and determine whether
they are complete and consistent with the information known to
Committee members;
b) Review complex and/or unusual transactions raised by the
External Auditors such as restructuring charges;
c) Meet with management and the External Auditors to review the
financial statements and the results of the audit;
d) Review management's handling of proposed audit adjustments
identified by the External Auditors and the resolution thereof;
and
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B. Interim Financial Statements, with respect thereto, the Committee
shall:
1. Determine how management develops and summarizes quarterly
financial information;
2. As a whole, or the Chairman alone, shall meet, after a pre-issuance
review is completed, with the External Auditors, either
telephonically or in person, to review the interim financial
statements and the results of the review; and
C. Compliance with Laws and Regulations, with respect thereto, the
Committee shall:
1. Periodically obtain updates from management, general counsel, and
the chief financial officer regarding compliance;
2. Make reasonable inquiry of the External Auditors to determine that
all regulatory compliance matters have been considered in the
preparation of the financial statements;
3. Review the findings of any examinations by regulatory agencies,
including the NASD and the Securities and Exchange Commission which
are delivered to the Committee; and
4. Prepare any report required from the Committee by the Rules of the
Securities and Exchange Commission.
D. Compliance with the Company's Code of Conduct, with respect thereto,
the Committee shall require that the Company's Code of Conduct is
disseminated to all employees, including at the initiation of
employment of all new employees.
E. In the event the Company shall establish the position of Internal
Auditor, then, with respect thereto, the Committee shall:
1. Review the activities and organizational structure of the Company's
internal audit function; and
2. Review the qualifications of the internal audit function and concur
in the appointment, replacement, reassignment, or dismissal of the
senior person responsible for any internal audit.
F. External Audit, with respect thereto, the Committee shall:
1. Prior to the commencement of the fiscal year audit, review the
External Auditors' proposed audit scope and approach;
2. Review the performance of the External Auditors and recommend to
the board of directors the appointment or discharge of the External
Auditors; and
3. Review and confirm the independence of the External Auditors and
the External Auditors' assertion of their independence.
G. The Committee shall perform the following additional responsibilities:
1. Meet with the External Auditors, chief financial officer, and
management in separate executive sessions to discuss any matters
that the Committee or these parties believe should be discussed
privately;
2. Review and discuss significant findings and recommendations made by
the External Auditors, and then by the internal auditors, if any;
3. Review, with the Company's outside counsel, any legal matters
raised in writing by the outside counsel that could have a
significant impact on the Company's financial statements;
4. Where directed in writing by the board of directors, institute
special investigations and, if appropriate, hire special counsel or
experts to assist; and
5. Periodically review and update this Charter, which amendments
shall require the approval of the board of directors.
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III. REPORTING RESPONSIBILITIES
The Committee shall report regularly to the board of directors about
Committee activities and make appropriate recommendations to the board of
directors, management, the External Auditors and the internal auditors, if any.
IV. LIMITS OF RESPONSIBILITIES AND POWERS
While the Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Committee to plan or conduct audits or to
determine that the Company's financial statements are complete and accurate and
are in accordance with generally accepted accounting principles. This is the
responsibility of management and the External Auditors. It is not the duty of
the Committee to conduct investigations (except as set forth in Section II,
Paragraph D, Subsection 4 hereof), to resolve disagreements, if any, between
management and the External Auditors or to assure compliance with laws and
regulations and the Company's Code of Conduct.
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APPENDIX B
HOME PRODUCTS INTERNATIONAL, INC.
2000 EMPLOYEE STOCK PURCHASE PLAN
SECTION 1. ESTABLISHMENT; PURPOSE; SCOPE.
Home Products International, Inc. hereby establishes the Home Products
International, Inc. 2000 Employee Stock Purchase Plan to encourage and
facilitate the purchase of Common Shares of the Company by eligible employees.
The Plan is intended to provide a further incentive for eligible employees to
promote the best interests of the Company and an additional opportunity to
participate in its economic progress. It is the intention of the Company to have
the Plan qualify as an "employee stock purchase plan" within the meaning of
Section 423 of the Code and provisions of the Plan shall be construed in a
manner consistent with the Code.
SECTION 2. DEFINITIONS; CONSTRUCTION.
As used in the Plan, as of any time of reference, and unless the context
otherwise required:
(a) "AFFILIATE" means any trade or business entity which is a member
of a controlled group with the Company (as described in Section
414(b) and (c) of the Code) or is a member of an affiliated
service group with the Company (as described in Section 414(m) of
the Code) and any other entity required to be aggregated with the
Company pursuant to final regulations under Section 414(o) of the
Code).
(b) "BOARD" means the Board of Directors of the Company as from time
to time constituted.
(c) "CODE" means the Internal Revenue Code of 1986, as amended.
(d) "COMMITTEE" has the meaning set forth in Section 3 hereof.
(e) "COMMON SHARES" means the common shares, par value $0.01 per
share, of the Company.
(f) "COMPANY" means Home Products International, Inc., a Delaware
corporation, and any successor thereto.
(g) "CONTROLLED GROUP" means the Company and its Subsidiaries.
(h) "EFFECTIVE DATE" means January 1, 2000.
(i) "EMPLOYER" means the Company and any corporation that is a member
of the Controlled Group that adopts the Plan with the prior
approval of the Company, as evidenced by a resolution of the
Board.
(j) "FAIR MARKET VALUE" means the closing price of a Common Share on
the NASDAQ Stock Market on the business day on the date of
reference. If the date of reference is not a business day, the
immediately preceding business day shall be used.
(k) "OFFERING PRICE" means eighty-five percent (85%) of the Fair
Market Value of a Common Share on the first day of the Purchase
Period.
(l) "PARTICIPANT" means any employee of an Employer who meets the
eligibility requirements of Section 4 hereof and who has accepted
an offer made by the Committee pursuant to Section 6(b) hereof.
(m) "PLAN" means the Home Products International, Inc. 2000 Employee
Stock Purchase Plan herein set forth and any amendment or
supplement thereto.
(n) "PURCHASE DATE" means June 30 or December 31 of each year during
the term of the Plan.
(o) "PURCHASE PERIOD" means the period of time between each Purchase
Date.
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(p) "SUBSIDIARY" means a corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each
of the corporations other than the last corporation in the
unbroken chain owns stock possessing 50 percent or more of the
total combined voting power of all classes of stock in one of the
other corporations in such chain.
(q) "TERMINATION DATE" means the date that the Board in its discretion
terminates the Plan. In no event, however, may an option be
exercised five years after the date an option is granted.
(r) "WITHHOLDING" has the meaning set forth in Section 6(b) hereof.
The masculine gender, when appearing in the Plan, shall be deemed to include the
feminine gender unless the context clearly indicates to the contrary. The words
"HEREOF," "HEREIN," and "HEREUNDER," and other similar compounds of the word
"HERE," shall mean and refer to the entire Plan and not to any particular
provision or section of this document.
SECTION 3. ADMINISTRATION.
The Plan shall be administered by the 2000 Employee Stock Purchase Plan
committee (hereinafter referred to as the "COMMITTEE"), the members of which
shall be at least two individuals selected by the Board. Subject to the express
provisions hereof, the Committee shall have complete authority to interpret the
Plan, to prescribe, amend and rescind rules and regulations relating to it and
to make all other determinations necessary or advisable for the administration
of the Plan. The Committee's determinations on the matters referred to in this
paragraph shall be conclusive. No member of the Committee shall be personally
liable for any decision or determination made in good faith under the Plan.
SECTION 4. ELIGIBILITY.
(a) Any employee of an Employer shall be eligible to participate in the
Plan after the employee attains at least six (6) months of continuous service
with an Employer except for those employees covered under a union collective
bargaining agreement. For the sole purpose of calculating length of service
under the Plan, employees shall be credited for service with an employer
immediately prior to the Company's acquisition of such employer or other member
of the Controlled Group or any Affiliate hereof. No eligibility provision hereof
shall permit or deny participation in the Plan in a manner contrary to the
applicable requirements of the Code and the regulations promulgated thereunder.
(b) Notwithstanding anything herein to the contrary, no employee shall be
entitled to participate in the Plan if such employee would own shares (including
shares which may be purchased under the Plan) possessing five percent (5%) or
more of the total combined voting power of value of all classes of stock of the
Company or its Subsidiaries, actually issued and outstanding. For the foregoing
purposes, the right to purchase stock under an option accrues when the option
(or any portion thereof) first becomes exercisable during the calendar year, and
the rules of stock attribution set forth in Section 424(d) of the Code shall
apply in determining share ownership.
SECTION 5. PURCHASE PRICE.
The purchase price shall be the lesser of (i) the Offering Price or (ii) 85
percent of the Fair Market Value of a Common Share on the last day of such
Purchase Period; in all instances adjusted to the nearest 1/8(th) point.
SECTION 6. NUMBER OF COMMON SHARES OFFERED.
(a) The maximum number of shares which shall be available for purchase
under the Plan shall be 500,000 Common Shares of the Company, subject to
adjustment as provided in Section 13. The Common Shares to be sold under the
Plan may at the election of the Company be either treasury shares or shares
originally issued for such purpose.
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(b) A Participant shall be entitled to elect to have withheld from his
payroll from a minimum of 2 percent up to a maximum of 12 percent of his
compensation ("WITHHOLDING"). Subject to the reductions as provided in clauses
(c) and (d) below, the total amount of the Withholding shall be used to purchase
Common Shares. For purposes of this Section 6, the number of shares to be
purchased equal to 2 percent of the Participant's compensation shall be called
the "BASE SHARES" and any number of additional shares to be purchased in excess
of the Base Shares shall be called the "ADDITIONAL SHARES." For purposes of this
subsection, compensation means the total wages, bonuses, commissions and
overtime paid with respect to a Purchase Period by the Company to a Participant
for services performed during such Purchase Period including deferrals described
in Sections 125 and 402(e)(3) of the Code, but excluding (i) extra compensation
based upon special arrangement; (ii) deferred compensation; (iii) reimbursed
expenses; (iv) expense allowances; (v) stock options and any gain or income
attributable thereto and (vi) other extra cash compensation (including, but not
limited to, cash and non-cash fringe benefits). The Committee may provide for a
separate election (of a different percentage) for a specified item or items of
compensation including, but not limited to, bonus payments.
(c) No Participant shall be granted an option to purchase shares under the
Plan that permits the Participant to purchase shares in any calendar year (under
the Plan and other employee stock purchase plans within the meaning of Section
423 of the Code) of the Company and its Subsidiaries with an aggregate fair
market value (determined at the time such option is granted) in excess of
$25,000.
(d) In the event that Participants elect to purchase more shares than are
available under clause (a) above, the maximum amount of Base Shares that any
Participant shall be permitted to purchase as Additional Shares shall be reduced
until the total number of shares that all Participants, in the aggregate, have
elected to purchase pursuant to clause (b) above first reducing proportionately
the number of Additional Shares elected by each Participant; and second,
proportionately reducing the number of Base Shares until the number of shares to
be purchased equals the number of shares available under clause (a) above.
Notwithstanding the preceding sentences of this clause (d), no Participant may
purchase fewer than ten shares.
(e) At the time the Common Shares are purchased, or at the time some or all
of the Common Shares issued under the Plan are disposed of, Participants must
make adequate provision for the Employer's federal, state, local or other tax
withholding obligations (including employment taxes), if any, which arise upon
the purchase or disposition of the Common Shares. At any time, the Employer may,
but shall not be obligated to, withhold from each Participant's compensation the
amount necessary for the Employer to meet applicable withholding obligations,
including any withholding required to make available to the Employer any tax
deductions or benefits attributable to the sale or early disposition of Common
Shares by the Participant. Each Participant, as a condition of participating
under the Plan, agrees to bear responsibility for all federal, state, and local
income taxes required to be withheld from his or her compensation as well as the
Participant's portion of FICA (both the OASDI and Medicare components) with
respect to any compensation arising on account of the purchase or disposition of
Common Shares. The Employer may increase income and/or employment tax
withholding on a Participant's compensation after the purchase or disposition of
Common Shares in order to comply with federal, state and local tax laws, and
each Participant agrees to sign any and all appropriate documents to facilitate
such withholding.
SECTION 7. ENROLLMENT PERIOD; EMPLOYEE'S ELECTION TO PARTICIPATE.
(a) The Committee shall establish an enrollment period during which an
eligible employee may elect to purchase shares by executing and delivering to
the Company an enrollment and payroll deduction authorization form.
(b) An election to purchase shall not constitute a contract to purchase.
Such an election shall merely notify the Company of the amount of the payroll
deduction authorized by the Participant for the Purchase Period and each
succeeding Purchase Period until the next Purchase Date.
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SECTION 8. PURCHASE PERIOD; PAYMENT FOR SHARES.
(a) Concurrently with his election, the Participant shall authorize a
payroll deduction during each Purchase Period. A Participant may discontinue his
election at any time, effective the first day of the next payroll period. If a
Participant discontinues his participation prior to the last day of the last
payroll period in a Purchase Period, such employee is not eligible to
participate in the Plan during the Purchase Period immediately following his
date of discontinuance. Thereafter, the employee may elect to commence
participation effective as of the first day of the first payroll period
beginning on any subsequent January 1 or July 1. A Participant may change the
percentage amount of his election effective as of the first day of the first
payroll beginning on or after the next January 1 or July 1. Any election to
discontinue participation, recommence participation or change of election must
be writing and submitted to the Committee or individual (or department)
designated by the Committee.
(b) All payroll deductions held by the Company under the Plan shall be held
on behalf of the Participant without interest.
(c) The Company shall purchase Common Shares on behalf of each Participant
pursuant to Section 9 hereof as soon as administratively practicable after each
Purchase Date.
(d) All payroll deductions received or held by the Company under the Plan
may be used by the Company for any corporate purpose, and the Company shall not
be obligated to segregate such payroll deductions.
SECTION 9. ISSUANCE AND DELIVERY OF STOCK CERTIFICATES; REGISTRATION.
(a) Certificates for Common Shares shall be issued and delivered to each
Participant for the number of Common Shares paid for in full as soon as
administratively practicable after each Purchase Date. No fractional shares will
be issued at any time.
(b) When all Common Shares purchasable under the Plan have been issued, any
payroll deductions that have not been used to purchase Common Shares shall be
used to purchase Common Shares for the next Purchase Period or if no additional
Common Shares will be purchased, returned to the applicable Participant.
(c) Shares to be delivered to a Participant under the Plan shall be
registered in the name of the Participant or, if the Participant so directs by
written notice to the Company prior to the issuance thereof, in the names of the
Participant and one other person as the Participant may designate, as joint
tenants with right of survivorship.
SECTION 10. TERMINATION OF EMPLOYMENT OR DISCONTINUANCE OF CONTRIBUTION.
Upon termination of employment, death or upon an election by the
Participant to discontinue contributions, the number of Common Shares paid for
in full by the Participant upon the application of all accumulated payroll
deductions, including from compensation due and owing, shall be purchased for
the Participant (or, in the case of the Participant's death, the beneficiary
designated by the Participant in accordance with procedures prescribed by the
Committee, or if no such beneficiary designation is in effect with respect to
such Participant, the Participant's estate), unless the Participant (or, in the
case of the Participant's death, his designated beneficiary or estate, as the
case may be) elects to abandon all or any such number of the Common Shares then
purchasable, pursuant to any rules or regulations the Committee shall make.
SECTION 11. RIGHTS NOT TRANSFERABLE.
The right to purchase Common Shares under this Plan shall not be
transferable by any Participant or exercisable, during his lifetime, by any
person other than the Participant.
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SECTION 12. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE.
(a) The existence of the Plan shall not affect in any way the right or
power of the Company or its shareholders to make or authorize any adjustment,
recapitalization, reorganization or other change in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stock that affects the
Common Shares or the rights thereof, 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.
(b) If, during the term of the Plan, the Company shall effect (i) a
distribution or payment of a dividend on its Common Shares in shares of the
Company, (ii) a subdivision of its outstanding Common Shares by a stock split or
otherwise, (iii) a combination of the outstanding Common Shares into a smaller
number of shares by a reverse stock split or otherwise, or (iv) an issuance by
reclassification or other reorganization of its Common Shares (other than by
merger or consolidation) of any shares of the Company, then each Participant
shall be entitled to receive upon the purchase of shares pursuant to this Plan
such shares of the Company which the Participant would have owned or would have
been entitled to receive after the happening of such event had the Participant
purchased Common Shares pursuant to the Plan immediately prior to the happening
of such event. If any other event shall occur that, in the judgment of the
Board, necessitates adjusting the Offering Price, the number of Common Shares
offered or other terms of the Plan, the Board shall take any action that in its
judgment shall be necessary to preserve each Participant's rights substantially
proportionate to the rights existing prior to such event. To the extent that any
event or action pursuant to this Section 12(b) shall entitle Participants to
purchase additional Common Shares or other shares of the Company, the shares
available under Section 6 shall be deemed to include such additional Common
Shares or such other shares of the Company.
(c) In the event of a merger of one or more corporations into the Company,
or a consolidation of the Company and one or more corporations in which the
Company shall be the surviving corporation, each Participant in the Plan shall,
at no additional cost, be entitled, upon his payment for all or part of the
Common Shares purchasable by him under the Plan, to receive (subject to any
required action by shareholders) in lieu of the number of Common Shares which he
was entitled to purchase, the number and class of shares of stock or other
securities to which such holder would have been entitled pursuant to the terms
of the agreement of merger or consolidation if, immediately prior to such merger
or consolidation, such holder had been the holder of record of the number of
Common Shares equal to the number of shares paid for by the Participant.
(d) If the Company is merged into or consolidated with another corporation
under circumstances where the Company is not the surviving corporation, or if
the Company sells or otherwise disposes of substantially all of its assets to
another corporation during the term of the Plan: (i) subject to the provisions
of clause (ii) below, after the effective date of such merger, consolidation or
sale, as the case may be, each holder of a right to purchase shall be entitled
to receive, upon his payment for all or part of the Common Shares purchasable by
him under the Plan, in lieu of Common Shares, shares of such stock or other
securities as the holders of Common Shares received pursuant to the terms of the
merger, consolidation or sale; and (ii) all outstanding rights to purchase may
be canceled by the Board as of the effective date of any such merger,
consolidation or sale, provided that (A) notice of such cancellation shall be
given to each Participant and (B) each such Participant shall have the right to
purchase, during a 30-day period preceding the effective date of such merger,
consolidation or sale, all or any part of the shares which would be allocated to
him under the terms of the Plan if the Purchase Date were set 30 days preceding
said effective date.
(e) Except as hereinbefore expressly provided, the issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock
of any class, for cash or property, or for labor or services either upon direct
sale or upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of Common Shares then available for
purchase under the Plan.
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SECTION 13. SHAREHOLDER APPROVAL.
The Plan is subject to the approval of a majority of the votes cast on the
matter by the shareholders of the Company within 12 months before or after its
adoption by the Board.
SECTION 14. RIGHTS OF A SHAREHOLDER.
No Participant shall have rights or privileges of a shareholder of the
Company with respect to shares purchasable under the Plan unless and until the
Participant shall become the holder of record of one or more Common Shares.
SECTION 15. NO REPURCHASE OF COMMON SHARES BY COMPANY.
The Company is not obligated to repurchase from any Participant Common
Shares he has acquired under the Plan.
SECTION 16. AMENDMENT OF THE PLAN.
The Board may at any time, and from time to time, amend the Plan in any
respect, except that, without the approval of the shareholders of the Company,
no amendment may be made that changes the number of shares to be reserved under
the Plan (other than as provided in Section 12) or the designation of
Subsidiaries whose employees may be offered options under the Plan.
SECTION 17. TERMINATION OF THE PLAN.
The Board may terminate the Plan at any time in its discretion. Upon
termination of the Plan, the Committee shall terminate payroll deductions and,
unless the Participant elects to abandon his shares, shall issue and deliver to
each Participant certificates for the number of Common Shares paid for in full.
A Participant may elect, upon termination of the Plan, to abandon all or any
number of the Common Shares then purchasable by and not yet issued to him,
provided that a Participant may not retain the right to purchase fewer than ten
Common Shares. The Committee shall refund to the Participant any amount
contributed by the Participant that exceeds the amount necessary to purchase the
number of Common Shares the Participant elects to purchase and not abandon. If
the Participant retains no right to purchase Common Shares, the Committee shall
refund to the Participant any amount contributed by the Participant. Any
contributions remaining in the Plan shall be refunded to the Participants making
such contributions as soon as administratively practicable after termination of
the Plan.
SECTION 18. COMPLIANCE WITH STATUTES AND REGULATIONS.
The sale and delivery of Common Shares under the Plan shall be in
compliance with relevant statutes and regulations of governmental authorities,
including state securities laws and regulations, and with the regulations of
applicable stock exchanges.
SECTION 19. GOVERNING LAW.
This Plan and all determinations made hereunder and action taken pursuant
hereto shall be governed by the laws of the State of Delaware and construed in
accordance therewith.
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Front Side of Proxy
PROXY
HOME PRODUCTS INTERNATIONAL, INC.
4501 West 47th Street
Chicago, Illinois 60632
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints James R. Tennant and James E. Winslow
as Proxies, (jointly and severally), each with the power to appoint his
substitute, and hereby authorizes them to represent and to vote, as designated
on the reverse side, all the shares of Common Stock of Home Products
International, Inc. held of record by the undersigned on April 6, 2001 at the
Annual Meeting of Stockholders to be held on May 24, 2001 or any adjournment
thereof.
In their discretion the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THE
SHARES WILL BE VOTED "FOR" ALL NOMINEES FOR DIRECTOR AND "FOR" APPROVAL OF THE
2000 EMPLOYEE STOCK PURCHASE PLAN.
The undersigned hereby acknowledges receipt of the Notice of the Annual
Meeting of Stockholders and the related proxy statement.
(continued on reverse side)
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_______________________
| I plan to |
| attend meeting |
Backside of Proxy | |
| [ ] |
_______________________
The Board of Directors recommends a vote FOR the Election of Directors and FOR Proposal No. 2.
1. Election of Directors.
FOR all nominees listed below WITHHOLD AUTHORITY
(except as marked to the contrary below) _____ to vote for all nominees listed below_____
(Instructions: To withhold authority to vote for any individual nominee, strike a line through a nominee's name in
the list below.)
Charles R. Campbell, Marshall Ragir, Jeffrey C. Rubenstein, Daniel B. Shure, Joel D. Spungin, James R. Tennant.
2. Approval of 2000 Employee Stock Purchase Plan.
________ FOR ________ AGAINST ________ ABSTAIN
In their discretion, the Proxies are authorized to vote upon such other business
as may properly come before the meeting.
Date:___________________, 2001
______________________________
Signature
______________________________
Signature (if held jointly)
Please sign exactly as name appears
hereon. When shares are held by
joint tenants, both should sign.
When signing as attorney, executor,
administrator, trustee, or guardian,
please give full title as such. If a
corporation, please sign in full
corporate name by President or other
authorized officer. If a
partnership, please sign in
partnership name by authorized
person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
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