March 19,
2009
Dear Shareholders:
As you know, we will hold our Annual General Meeting of
Shareholders on April 30, 2009. Enclosed is a supplement to
the Proxy Statement that we previously filed with the Securities
and Exchange Commission on March 16, 2009, concerning the
Annual General Meeting. You should carefully read the supplement
in conjunction with the Proxy Statement prior to voting on the
proposals described in the Proxy Statement. Except as
specifically set forth in the supplement, the supplement does
not otherwise update any information as originally filed and
does not reflect events occurring after the original filing date
of the Proxy Statement.
Sincerely,
BRETT R. CHAPMAN
General Counsel and Corporate Secretary
SUPPLEMENT
TO PROXY STATEMENT DATED MARCH 16, 2009
Herbalife Ltd., or the Company, is filing this Supplement to
Proxy Statement to revise and supplement certain disclosure in
its Proxy Statement related to its 2009 Annual General Meeting
of Shareholders originally filed with the Securities and
Exchange Commission on March 16, 2009, or the Proxy
Statement. Except as specifically set forth below, this
Supplement does not otherwise update any information as
originally filed and does not reflect events occurring after the
original filing date of the Proxy Statement.
The third and forth sentences of the paragraph under the heading
General on page 18 of the Proxy Statement are
replaced with the following:
For 2008 this goal was a targeted earnings per share, or
EPS, of $3.17. As discussed below, for Mr. Johnson, payout
pursuant to the alternative award was also subject
to a net sales growth goal. The annual incentive funded and
payable to each of Messrs. Johnson, Goudis, and Chapman is
based solely on EPS, and net sales growth, as applicable,
without Committee discretion.
The second to last sentence of the second paragraph under the
heading Targets and Determination on page 18 of
the Proxy Statement is replaced with the following:
For 2008, the Committee established an EPS goal under the
regular performance award and both an EPS and a net
sales growth rate goal (weighted equally) under the
alternative performance award.
The Michael O. Johnson (alternative) line item in
the table at the top of page 19 of the Proxy Statement is
deleted. The paragraph that immediately follows that table is
replaced with the following:
Under the terms of Mr. Johnsons employment
agreement, there is no bonus funding under the portion of the
alternative performance award based upon the EPS
goal unless the Company achieves its threshold EPS of $3.17. At
the threshold level of performance, the payout under the EPS
portion of the alternative performance award would
be 18.75% of Mr. Johnsons base salary. Bonus funding
and payout under the EPS portion of the alternative
performance award increases by 10% of Mr. Johnsons
base salary upon achievement of EPS of $3.27 and thereafter
increases by an additional 1% of base salary for each $0.01
increase in EPS, with a maximum payout of 37.5% of base salary
if EPS equals or exceeds $3.37.
Under the terms of Mr. Johnsons employment agreement,
there is no bonus funding under the portion of the
alternative performance award based upon the net
sales growth rate goal unless the Company achieves its threshold
net sales growth rate of 8.0%. At the threshold level of
performance, the payout under the net sales growth rate portion
of the alternative performance award would be 18.75%
of Mr. Johnsons base salary. Bonus funding and payout
under the net sales growth rate portion of the
alternative performance award increases by 10% of
Mr. Johnsons base salary upon achievement of a net
sales growth rate of 8.2% and thereafter increases by an
additional 1% of base salary for each 0.1% or 0.2% increase in
the net sales growth rate, with a maximum payout of 37.5% of
base salary if the net sales growth rate equals or exceeds 9.8%.
Based on the Companys 2008 EPS and net sales growth rate,
adjusted for certain non-recurring items that were agreed upon
by the Committee at the time bonus targets were originally set,
including nonrecurring expenses arising under our 2008
Reorganizing for Growth Plan and an increase in a tax valuation
allowance on deferred tax assets, the Committee recommended, and
the independent members of the Board of Directors approved, the
full amount under the applicable achievement tiers to
Mr. Johnson in respect of each of his regular
and alternative performance awards. On the basis of
the same 2008 EPS, each of Messrs. Chapman and Goudis
received the full amount due to them under the applicable
achievement tier as set forth above and, in consideration of the
achievement of the corporate and individual performance criteria
specified in the Senior Management Bonus Plan, Mr. Johnson
recommended, and the Committee approved, the incentive awards to
each of Messrs. Walsh and Henig as are set forth in the
2008 Summary Compensation Table under the heading
Non-Equity Incentive Plan Compensation.
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