Section 240.14a-101 Schedule 14A.
Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
(Amendment No. )
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[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
Water Pik Technologies, Inc.
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(Name of Registrant as Specified In Its Charter)
..................................................................
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[WATERPIK LOGO]
April 22, 2004
To Our Stockholders,
LAST WEEK WE REPORTED STRONG FINANCIAL RESULTS. OUR STOCK PRICE IS NEAR ITS
ALL-TIME HIGH. OUR EARNINGS PER SHARE HAVE INCREASED 128% TO $0.41 FOR THE
SIX-MONTHS THAT ENDED ON MARCH 31, 2004 -- $0.23 BETTER THAN THE SAME PERIOD
LAST YEAR. SALES AND PROFITS IN BOTH OUR BUSINESSES HAVE IMPROVED COMPARED TO
LAST YEAR. Under the leadership of our Board and management team, we have
increased value to you, our stockholders. And, we are confident and optimistic
about the future of Water Pik.
IN THE MIDST OF THIS STRONG FINANCIAL PERFORMANCE, WE ARE ASKING YOU TO VOTE
THE ENCLOSED WHITE PROXY CARD FOR OUR ANNUAL MEETING OF STOCKHOLDERS ON MAY
13, 2004, IN FAVOR OF:
TWO INCUMBENT DIRECTORS (MICHAEL HOOPIS, THE CHIEF EXECUTIVE OFFICER OF WATER
PIK, AND WILLIAM OUCHI, A PROFESSOR IN THE GRADUATE SCHOOL OF MANAGEMENT AT
UCLA).
They have helped lead Water Pik to the excellent earnings improvement that we
reported last week. They are being opposed by Michael Tennenbaum, a dissident
stockholder, and his partner. Our Directors need your support.
OUR PLANS TO BUILD VALUE FOR ALL STOCKHOLDERS ARE WORKING
Under the leadership of our Board and management team:
WATER PIK'S STOCK PRICE HAS DOUBLED -- A GAIN OF 122% IN VALUE SINCE OUR
SPIN-OFF IN 1999.
OUR FINANCIAL PERFORMANCE AND OUTLOOK HAS IMPROVED:
For the six-months ended March 31, 2004 our sales grew 18% over the same
period last year -- with improvements in both our personal heath care and
pool products and heating systems businesses. We have announced sales
growth targets in the range of 12% to 14% for the twelve-months ending
September 2004.
Earnings also continued to improve. We have revised upward our expected
diluted earnings in the range of $1.00 to $1.05 per share for the
twelve-months ending September 2004.
Based on our current business plan that includes recent acquisitions, our
outlook includes compounded growth rates for sales of 9% and for operating
income of 25% for the period beginning with the twelve-months ended
September 2003 through fiscal year 2006.
Meanwhile, Michael
Tennenbaum, a dissident
stockholder, has criticized the
investments that helped
generate these gains. Look
closely at the results: today,
after several years' work to
reinvigorate our product lines,
we are generating about 33%
of our sales from new
products -- that's up from 10%
in 2000.
% of Sales From New Products Less Than 3 Years Old
2004
2000 2001 2002 2003 Target
---- ---- ---- ---- ------
New Product 11% 16% 19% 27% 36%
TRUST IS THE CENTRAL ISSUE IN THIS PROXY
We have said before that we no longer trust Mr. Tennenbaum. We say this
after having many conversations with him, after monitoring his behavior at other
companies -- and after hearing Mr. Tennenbaum pose this question to Water Pik:
'WHEN IS THE BOARD GOING TO JUST TURN CONTROL OF THE COMPANY OVER TO ME?'
Here is more of Mr. Tennenbaum's history with Water Pik:
In 2001, Mr. Tennenbaum was the successful bidder, among several bidders,
for a private offering of Water Pik stock. He is a major stockholder today
partly because he offered to make his investment without board
representation. Under the leadership of the Board and management, Water Pik
has outperformed the market and for Mr. Tennenbaum, his $15 million
investment is now worth $32 million.
When he invested, he knew about our anti-takeover protections, and didn't
object.
Mr. Tennenbaum has publicly advocated breaking up Water Pik. He opposes
future investments in Water Pik and opposes giving our current investments
time to reach full value -- despite our strong financial performance and
our rising stock price.
Although in his letter to you he made a 'pledge not to contest more than
two board seats,' he already, in letters sent to us (which are publicly
available in his Schedule 13D filings on the SEC's website), also has
nominated another of his partners for a third board seat if another board
seat is available.
From his actions, we believe that Mr. Tennenbaum has his own short-term
agenda, is not credible about his motives, is taking the first step to gain
control of our Company without compensating other stockholders, and, AS A
RESULT . . . WE DO NOT TRUST HIM.
THERE'S MORE VALUE TO BE CREATED AT WATER PIK
We're proud that Water Pik's stock price is near its all-time high. But we
know there's more to be done -- and your management is prepared to get it done.
Since November 1999, we have pursued a plan to invest in the business to
grow sales and generate profits. The strong sales growth and profit
improvement in each of the last two quarters points to the success of our
growth initiatives.
We continue to focus on leveraging our sales momentum into higher
profitability. We are completing a comprehensive review of our business to
identify new steps to further build value.
We have made strategic acquisitions that are contributing to near term
sales and earnings growth. And, we have not burdened the company with
significant debt to pay for these acquisitions. We will continue to look to
acquire strategic businesses to enhance our product offerings to our
customers.
VOTE FOR THE INCUMBENT DIRECTORS SO WE CAN CONTINUE
TO CREATE VALUE FOR YOU AND ALL STOCKHOLDERS
The question you must decide: Whom do you trust to maximize value for all
stockholders?
Do you want the next phase of the Company's development to be driven by the
incumbent team? It's a team that has delivered value during a difficult
economy.
Do not allow one stockholder to potentially take the first steps toward
getting control of Water Pik. By inserting himself and his partner onto a
proven, independent Board, we believe his motive is to promote his own
short-term agenda.
No single stockholder should be allowed to divert attention from our mission
to realize the full value of Water Pik's potential for all stockholders.
We need your support today so management can build value into the future.
Your Board of Directors unanimously recommends that you vote the WHITE proxy
card in favor of Water Pik's incumbent Directors:
MICHAEL P. HOOPIS, Water Pik's Chief Executive Officer
WILLIAM G. OUCHI, UCLA's Sanford and Betty Sigoloff Professor in Corporate
Renewal at the Anderson Graduate School of Management
PLEASE SIGN, DATE AND RETURN THE WHITE PROXY CARD IN THE ENCLOSED ENVELOPE
TODAY. Thank you for your continued support. If you have any questions, please
call our proxy solicitor, MacKenzie Partners, Inc. toll-free at 1-800-322-2885
or 212-929-5500 (call collect).
Sincerely,
The Board of Directors of Water Pik Technologies, Inc.
Robert P. Bozzone W. Craig McClelland
Robert P. Bozzone W. Craig McClelland
F. Peter Cuneo William G. Ouchi
F. Peter Cuneo William G. Ouchi
Babette E. Heimbuch Charles J. Queenan, Jr.
Babette E. Heimbuch Charles J. Queenan, Jr.
Michael P. Hoopis
Michael P. Hoopis
OTHER INFORMATION
Water Pik Technologies, Inc. has filed with the SEC its definitive proxy
materials for the 2004 Annual Meeting of Stockholders. These materials contain
important information concerning the matters to be acted upon at the 2004 Annual
Meeting, the position of the Board of Directors with respect to those matters
and the participants in the solicitation of proxies for that meeting.
Investors are urged to read Water Pik's proxy statement and additional
materials and other relevant documents filed with the SEC by Water Pik.
Investors may obtain these documents free of charge at the SEC's website
(www.sec.gov). In addition, documents filed with the SEC by Water Pik are
available free of charge at the 'Investors/Corporate Info' section of Water
Pik's website at (www.waterpik.com) or by contacting Water Pik Technologies,
Inc., 23 Corporate Plaza, Suite 246, Newport Beach, California 92660
(949) 719-3700.
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PLEASE VOTE TODAY
IF YOU HAVE ANY QUESTIONS OR NEED ASSISTANCE IN VOTING
YOUR WHITE PROXY CARD, PLEASE CALL:
[MACKENZIE LOGO]
105 Madison Avenue
New York, New York 10016
proxy@mackenziepartners.com
Call Collect: (212) 929-5500
or
TOLL-FREE (800) 322-2885
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