SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1 TO FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
For the fiscal year ended January 29, 2000
Commission file number 1-6083
NOODLE KIDOODLE, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 11-1771705
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
6801 Jericho Turnpike, Syosset, NY 11791
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number,
including area code (516)-677-0500
Securities registered pursuant to Section 12 (b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
Common Stock, $.001 par value NASDAQ National Market
Securities registered pursuant to Section 12 (g) of the Act:
NONE
Indicate by check mark whether the registrant: (1) has
filed all reports required to be filed by Section 13 or 15
(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90
days. Yes X No __
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of
registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [ ]
The aggregate market value of voting stock held by non-
affiliates of the registrant as of April 12, 2000 was
$37,552,848, based on the closing price of same stock on
that date. In determining the market value of non-
affiliated voting stock, shares of common stock
beneficially owned by each executive officer and director
have been excluded. This determination of affiliate
status is not necessarily a conclusive determination for
other purposes.
<PAGE>
The number of shares of common stock outstanding as of
April 12, 2000 was 7,605,640.
Documents Incorporated by reference: See pages 19 to 21
in the original Form 10-K filed on April 28, 2000 for the
exhibit index.
<PAGE>
Table of Contents
Page
PART III
Item 10. Directors and Executive Officers of
the Registrant 2
Item 11. Executive Compensation 7
Item 12. Security Ownership of Certain Beneficial
Owners and Management 11
Item 13. Certain Relationships and Related
Transactions 14
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AMENDMENT NO. 1
TO THE ANNUAL REPORT ON FORM 10-K
OF NOODLE KIDOODLE, INC.
FOR THE FISCAL YEAR ENDED JANUARY 29, 2000
In compliance with General Instruction G(3) to Form
10-K, the following Items comprising Part III were omitted
from the Annual Report on Form 10-K filed by Noodle
Kidoodle, Inc. on April 28, 2000. Part III of that Form
10-K is hereby amended and restated to insert such Items
as hereinafter set forth. All capitalized terms used
herein but not defined herein shall have the respective
meanings ascribed to them in that Form 10-K.
PART III
ITEM 10-DIRECTORS AND EXECUTIVE OFFICERS OF REGISTRANT
CLASS 3 DIRECTORS TO SERVE UNTIL 2000 MEETING
STANLEY GREENMAN (1) Director since 1976
Mr. Greenman, age 51, has been Chairman of the Board,
Chief Executive Office and Treasurer of the Company since
1990. Mr. Greenman has been an employee of the Company
since 1969.
JOSEPH MADENBERG Director since 1993
Mr. Madenberg, age 63, has been the President of
Joseph A. Madenberg, Inc. (retail management consulting
firm) since 1968. Until his retirement in December 1992,
Mr. Madenberg was a Professor of Business Administration
at Suffolk County Community College .
CLASS 2 DIRECTORS TO SERVE UNTIL 2002 MEETING
ROBIN FARKAS Director since 1993
Mr. Farkas, age 66, is currently a self-employed
private investor. From March 1994 to March 1995, Mr.
Farkas was a director of the Dormitory Authority of the
State of New York and from 1984 to 1992, he was Chairman
of the Board, Chief Executive Officer of Alexander's, Inc.
(mass merchandise retail chain). Mr. Farkas is also a
member of the boards of directors of Insignia Financial
Group, Inc., and Refac Technology Corp.
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STEWART KATZ (1) Director since 1973
Mr. Katz, age 59, has been the President, Chief
Operating Officer and Assistant Secretary of the Company
since 1977. Mr. Katz has been an employee of the Company
since 1970.
ROBERT STOKVIS Director since 1991
Mr. Stokvis, age 52, has been the owner and
President of Stokvis Enterprises, Inc. (investments) for
more than the past five years. Mr. Stokvis is also the
Chairman of the Board of First Choice Copy (electronic
printing business) and Chairman of the Board of Red Rose
Legal Copy Centers Inc. (legal copy services).
CLASS 1 DIRECTORS TO SERVE UNTIL 2001 MEETING
LESTER GREENMAN (1) Director since 1994
Mr. Greenman, age 45, has been Vice President of
Israel Infinity Fund LP (investments in startup internet
and software companies) since November, 1998. Prior to
this, he was a consultant in the entertainment software
industry from March, 1997 - November, 1998; served as
Senior Vice President of Software Publishing for Marvel
Entertainment Group, Inc. from September, 1996 to March,
1997; Vice President of Legal and Business Affairs of
Sony Electronic Publishing Company ("SEPC") from 1993 -
1996; Director of Legal and Business Affairs for SEPC from
1992-1993; and as Counsel to SEPC from 1991-1992; and
served as Assistant United States Attorney in the Southern
District of New York from 1990 to 1991.
MELVIN C. REDMAN Director since 1997
Mr. Redman, age 49, has been the President and Chief
Operating Officer of Doctor's Community Heathcare
Corporation (owners of several hospitals in the U.S.)
since January, 1999. Prior to this, he was the founder
and President of Alliance Consulting, Inc. (management
consulting firm) since November, 1995; and is the founder
and has served as sole proprietor of Redman & Associates
(management consulting firm) since September, 1995. From
1978 until his retirement in June, 1995, he served in a
variety of management positions at Wal-Mart Stores, Inc.
(mass merchandise retail chain). Mr. Redman's positions
at Wal-Mart included the following: Senior Vice President
Store Operations in 1995; Senior Vice President of Wal-
Mart Canada in 1994; Senior Vice President 1992-1993; and
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Senior Vice President Store Planning and Operations
Systems from 1990 - 1992.
BARRY W. RIDINGS Director since 1994
Mr. Ridings, age 47, has been a Managing Director at
Lazard Freres & Co., LLC (investment banking and
securities brokerage firm) since July 1, 1999; prior to
this he was a Managing Director of DBAlex.Brown
(investment banking and securities brokerage firm) since
1990; and was a Managing Director at Drexel Burnham
Lambert from 1986 to 1990. Mr. Ridings is also a member
of the boards of directors of New Valley Corporation and
Furr's Restaurant Group, Inc.
1. Stanley Greenman and Lester Greenman are brothers.
Stewart Katz is the brother-in-law of Stanley Greenman and
Lester Greenman.
BOARD OF DIRECTORS COMMITTEES, MEETINGS AND DIRECTOR
COMPENSATION
Executive Committee: The Executive Committee is currently
comprised of Stanley Greenman, Stewart Katz and Joseph
Madenberg. The Executive Committee meets between Board
meetings when necessary and has the authority to act, within
limits set by the Board of Directors, on behalf of the Board
of Directors in connection with substantially all operating
matters. The Executive Committee did not hold any meetings
during the fiscal year ended January 29,2000.
Audit Committee: The Audit Committee is currently comprised
of Robin Farkas, Barry Ridings, and Robert Stokvis. The
Audit Committee meets with the Company's independent
auditors and principal financial personnel to review the
results of the annual audit. The Audit Committee also
reviews the scope of the annual audit and other services
before being undertaken by the Company's independent
auditors, and reviews the adequacy and effectiveness of the
Company's internal accounting controls. The Audit Committee
communicates any findings or recommendations to the Board.
The Audit Committee held 2 meetings during the fiscal year
ended January 29, 2000.
Compensation and Stock Option Committee: The Compensation
and Stock Option Committee is currently comprised of Robin
Farkas, Joseph Madenberg and Robert Stokvis. The primary
function of the Compensation and Stock Option Committee is
to review and approve the compensation of certain officers
of the Company, and to review and approve the granting of
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stock options to officers and other key members of
management. The Compensation and Stock Option Committee
held 5 meetings during the fiscal year ended January 29,
2000.
Special Committee: The Special Committee is comprised of
Lester Greenman, Barry Ridings and Robert Stokvis. This
committee was established on January 11, 2000 for the
purpose of assisting management in the negotiation of the
proposed merger with Zany Brainy.
The Company does not have a standing nominating
committee or a committee performing similar functions.
During the fiscal year ended January 29, 2000, the
Board of Directors held 6 meetings. Directors as a whole
attended approximately 88% of the aggregate of all Board and
Committee meetings (with respect to Committees of which they
were members, excluding the Executive Committee, for which
no attendance records are maintained). Messrs. Redman and
Ridings attended less than 75% of the combined Board and
Committee meetings (with respect to the Committees of which
they were members).
Director Compensation
Directors who are not employees of the Company receive
an annual fee of $5,000. In addition, for each Board
meeting they attend, they receive a fee of $2,000 and for
attendance at committee meetings which are held on a date
other than that of a scheduled Board of Directors Meeting
they receive a fee of $1,000. Directors who serve on the
Special Committee will be paid fees in compensation for
their services on the committee as set forth in the
following table:
NAME AMOUNT OF FEE
Barry Ridings, Chairperson $ 20,000
Lester Greenman $ 15,000
Robert Stokvis $ 15,000
Directors who are not employees of the Company are
issued an option to purchase 5,000 shares of Common Stock of
the Company upon initial election to the Board of Directors.
Each year thereafter, non-employee Directors are issued an
option to purchase 6,000 shares of Common Stock of the
Company. The options granted under the Plan have a term of
5 years and become exercisable as to 50% of the shares on
the first anniversary of the date of the grant and as to the
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remaining 50% on the second anniversary of the date of
grant.
Mr. Bernard Greenman, a founder and former Chairman of
the Company, passed away in April, 1994. Pursuant to a
consulting agreement, dated January 31, 1990, by and between
the Company and Bernard Greenman, the Company is required
to provide coverage or reimbursement for all medical and
dental expenses, incurred by Mr. Greenman's widow, Phyllis
Greenman, during her lifetime.
COMPLIANCE WITH SECTION 16 (a) OF THE SECURITIES EXCHANGE
ACT OF 1934
Section 16(a) of the Securities and Exchange Act of 1934
requires the Company's directors and executive officers, and
persons who own more than ten percent of a registered class
of the Company's equity securities, to file with the
Securities and Exchange Commission ("SEC") initial reports
of ownership and reports of changes in ownership of Common
Stock and other equity securities of the Company. Reporting
persons are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file.
To the Company's knowledge, based solely on review of
the copies of such reports furnished to the Company, all
Section 16(a) filing requirements applicable to its
officers, directors and greater than ten percent
stockholders were complied with during the fiscal year ended
January 29,2000.
EXECUTIVE OFFICERS
The executive officers of the Company are Stanley
Greenman and Stewart Katz, for whom certain background
information is set forth above under "Election of
Directors," and Kenneth S. Betuker.
Mr. Betuker, age 47,presently acting CFO, will serve
the Company as a consultant after May 12, 2000. Prior
thereto, since December, 1996, he has been the Vice
President, CFO and Secretary of the Company. For more than
five years prior thereto, he was the Executive Vice
President, Chief Financial and Administrative Officer and
Treasurer of First National Supermarkets, Inc., (retail
supermarket chain) a wholly owned subsidiary of Royal Ahold
N.V.
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ITEM 11 - EXECUTIVE COMPENSATION
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth information concerning
the compensation for services, in all capacities for the
fiscal years ended January 29, 2000 ("fiscal 2000"),
January 30, 1999 ("fiscal 1999"), and January 31, 1998
("fiscal 1998"), of those persons who were, at the end of
fiscal 2000, the Chief Executive Officer and the only other
executive officers of the Company whose compensation for
fiscal 2000 exceeded $100,000 (collectively, the "Named
Officers").
<TABLE>
Annual Compensation Long Term Compensation
Other Annual Restricted All Other
Name and Principal Fiscal Compensation Stock (#) LTIP Compensation
Position Year Salary Bonus (1) Awards Options Payouts (2)
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stanley Greenman 2000 $330,000 $140,310 - None 30,000 None $ 792.00
Chairman of the Board 1999 $300,000 $ 13,798 - None 60,000 None $ 238.00
Chief Executive Officer 1998 $275,000 $ None - None 60,000 None 4 550.00
and Treasurer
Stewart Katz 2000 $302,500 $128,612 - None 30,000 None $ 726.00
President 1999 $275,000 $ 12,647 - None 60,000 None $ 238.00
Chief Operating Officer 1998 $250,000 None - None 60,000 None $ 596.00
Kenneth S. Betuker 2000 $215,000 $ 63,471 - None 20,000 None $1,133.00
Vice President, Chief 1999 $190,000 $ 5,749 - None 20,000 None $ 238.00
Financial Officer and 1998 $175,000 None - None 5,000 None None
Secretary
</TABLE>
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(1) The aggregate amount of perquisites and other personal
benefits paid to each of the Named Officers for fiscal
2000 did not exceed the lesser of 10% of such officer's
total annual salary and bonus for each of fiscal 2000,
1999, and 1998 or $50,000; such amounts are, therefore,
not reflected in the table.
(2) Represents matching contributions made by the Company
under the Company's 401(k) Plan.
Option Grants Table for Fiscal 2000
The following table sets forth information concerning
stock option grants made during fiscal 2000 to the Named
Officers. These grants are also reflected in the Summary
Compensation Table. In accordance with SEC rules, a
repricing of outstanding options is treated as a new grant.
Also in accordance with the SEC rules, the hypothetical
gains or "options spreads" for each option grant are shown
based on compound annual rates of stock price appreciation
of 5% and 10% from the grant date to the expiration date.
The assumed rates of growth are prescribed by the SEC and
are for illustrative purposes; they are not intended to
predict future stock prices, which will depend upon market
conditions and the Company's future performance. The
Company has not granted any stock appreciation rights.
<TABLE>
Individual Grants Potential Realizable Value at
% of Total Assumed Annual Rates of
Number of Options Stock Price Appreciation
Securities Granted to for Option Term
Underlying Employees in Exercise 5% 10%
Options Fiscal Year Price Expiration Stock Potential Stock Potenial
Granted(#) 2000(1) ($-Share)(2) Date(3) Price Value Price Value
<CAPTION>
Name
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stanley Greenman 30,000 10.9% $ 4.438 9/22/04 $5.66 $36,660 $7.15 $81,360
Stewart Katz 30,000 10.9% $ 4,438 9/22/04 $5.66 $36,660 $7.15 $81.360
Kenneth S. Betuker 20,000 7.3% $ 4.438 9/22/04 $5.66 $24,440 $7.15 $54,240
</TABLE>
<TABLE>
Number of Securities Value of
Underlying Unexercised Unexercised In-The-Money
Shares Acquired Value Options at 01/29/00(#) Options at 01/29/00($)(1)
Name on Exercise # Realized ($) Exercisable Unexercisable Exercisable Unexercisable
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Stanley Greenman None N/A 75,000 105,000 $ 46,875 $ 74,985
Stewart Katz None N/A 75,000 105,000 $ 46,875 $ 74,985
Kenneth S. Betuker None N/A 26,250 43,750 $ 6,250 $ 18,740
</TABLE>
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(1) During fiscal 2000, options to purchase a total of
275,500 shares were granted to 256 employees.
(2) The exercise price of the options granted was equal to
the fair market value of the underlying stock on the date
of grant.
(3) Grants become exercisable in equal installments on the
first four anniversaries of the date of grant. Vesting
may be accelerated upon the occurrence of certain events.
See "Executive Compensation-Employment Agreements."
Aggregated Option Exercises in Fiscal 2000 and Fiscal Year-
End Option Value Table
(1) The following table provides information concerning
all exercises of stock options during fiscal 2000 by the
Named Officers and the fiscal year-end value of
unexercised options on an aggregated basis. The Company
has not granted any stock appreciation rights. Options
are "in-the-money" if on January 29, 2000, the market
price of the Common Stock ($4.75) exceeded the exercise
price of such options. The value of such options is
calculated by determining the difference between the
aggregate market price of the Common Stock covered by the
options on January 29,2000 and the aggregate exercise
price of such options.
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Employment Agreements
As of February 1, 1998, the Company entered into
employment agreements with Stanley Greenman and Stewart Katz
(collectively, the "Employment Agreements").
Each of the Employment Agreements provides for
employment until January 31, 2001 and annual base salaries
for Messrs. Greenman and Katz of $300,000 and $275,000
respectively, in each case subject to increases determined
by the Compensation and Stock Option Committee and approved
by the Board of Directors. In addition, each of the
Employment Agreements provide that in the event of a Change
in Control of the Company (as defined in such agreements)
which results in an actual or constructive termination of
employment (as defined in such agreements), such terminated
officer is entitled to receive severance pay equal to the
difference between 299% of his respective average annual
compensation for the prior five calendar years and the
present value of all other payments received by him which
would be considered as contingent on a change in control.
Exercisability of certain stock options held by the Named
Officers would also be accelerated by actual or constructive
termination or hostile takeover events and the value of such
accelerated options would be included in the above
described calculation.
In addition, the Employment Agreements provide for the
participation in the Company's Bonus Incentive Plan by Mr.
Greenman and Mr. Katz (each an "Executive").
The Employment Agreements also provide that each
Executive will be eligible for grants of stock options to
acquire shares of Common Stock of the Company pursuant to
the Company's 1994 Stock Incentive Plan.
On April 15, 1999, the Board of Directors accepted a
recommendation made by the Compensation and Stock Option
Committee to increase salaries for Messrs. Greenman and
Katz, effective February 1, 1999 to $330,000 and $302,500
respectively.
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ITEM 12 - SECURITY OWNERSHIP
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Principal Stockholders
As of May 10, 2000, the following persons were known by
the Company to own beneficially (as defined under applicable
rules of the Securities and Exchange Commission) more than
5% of the Company's Common Stock:
<TABLE>
Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership of Class
<CAPTION>
<S> <C> <C>
Dimensional Fund Advisors 492,100 (1) 6.46%
1299 Ocean Avenue - Suite 650
Santa Monica, California 90401
Royce & Associates, Inc. 415,800 (2) 5.46%
1414 Avenue of the Americas
New York, New York 10019
</TABLE>
1. Based upon information contained in a Schedule 13G filed
with the Securities and Exchange Commission on February
11, 2000. Such Schedule states that Dimensional Fund
Advisors Inc. ("Dimensional"), an investment advisor
registered under Section 203 of the Investment Advisors
Act of 1940, furnishes investment advice to four
investment companies registered under the Investment
Company Act of 1940, and serves as investment manager of
certain other commingled group trusts and separate
accounts. These investment companies, trusts and
accounts are the "Funds." In its role as investment
advisor or manager, Dimensional possesses voting and/or
investment power over the securities of the Company
described in this schedule that are owned by the Funds.
All securities reported in this schedule are owned by the
Funds. Dimensional disclaims beneficial ownership of
such securities.
2. Based upon information contained in a Schedule 13G filed
with the Securities and Exchange Commission, on February
1, 2000. Such Schedule states that this filing is on
behalf of Royce & Associates, Inc. ("Royce") and Charles
M. Royce as members of a group pursuant to Rule 13d-
(1)(b)(ii)(H). Royce is an investment advisor
registered under Section 203 of the Investment Advisors
Act of 1940. Mr. Royce may be deemed to be a controlling
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person of Royce and as such may be deemed to beneficially
own the shares of Common Stock of Noodle Kidoodle, Inc.
beneficially owned by Royce. Mr. Royce does not own any
shares outside of Royce, and disclaims beneficial
ownership of the shares held by Royce.
ITEM 12 - SECURITY OWNERSHIP - continued
Management
As of May 10, 2000 each Director and nominee for
Director of the Company, and the Named Officers (as defined
in "Executive Compensation") and executive officers,
nominees and directors of the Company as a group,
beneficially owned (as defined under applicable rules of the
Securities and Exchange Commission) shares of the Company's
Common Stock as follows:
<TABLE>
Percent of
Amount and Nature of Class as of
Beneficial Ownership (1) May 10, 2000
<CAPTION>
<S> <C> <C>
Stanley Greenman 367,685 (2) 4.8%
Stewart Katz 346,607 (3) 4.6%
Lester Greenman 218,000 2.9%
Robert Stokvis 36,500 *
Kenneth S. Betuker 34,100 *
Robin L. Farkas 17,000 *
Joseph A. Madenberg 15,000 *
Barry W. Ridings 14,000 *
Melvin C. Redman 9,000 *
All executive officers, nominees
and directors as a group (9 persons) 1,057,892 13.9%
</TABLE>
* Less than 1%
1. Includes shares issuable upon exercise of options
currently exercisable or exercisable within 60 days from
May 10, 2000 as follows: Stanley Greenman (90,000),
Stewart Katz (90,000), Lester Greenman (12,000), Robert
Stokvis (12,000), Barry W. Ridings (12,000), Joseph A.
Madenberg (12,000), Robin L. Farkas (12,000), Kenneth S.
Betuker (27,500) and Melvin C. Redman (9,000).
2. Includes 18,750 shares owned of record by Ari Greenman,
Mr. Greenman's son, with respect to which Mr. Greenman
disclaims beneficial ownership.
3. Includes 181,200 shares owned of record and beneficially
by Stewart Katz's wife and 37,907 shares owned of record
by Bradley and Brian Katz, Mr. Katz's sons, with respect
to which Mr. Katz disclaims beneficial ownership.
Except as noted in the footnotes to the two tables
above, to the Company's knowledge, the beneficial holders
listed above have sole voting and investment power regarding
the shares shown as being beneficially owned by them.
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Management controls, in the aggregate, approximately
13.9% of the outstanding Common Stock of the Company.
ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
NONE.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of
the Securities Exchange Act of 1934, the Registrant has duly
caused this Amendment No. 1 to the Annual Report on Form 10-K
to be signed on its behalf by the undersigned, thereunto
duly authorized.
NOODLE KIDOODLE, INC.
(Registrant)
May 25, 2000 BY: /s/Stanley Greenman
Stanley Greenman
Chairman of the Board
Chief Executive Officer
