SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10K/A
ANNUAL REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Fiscal Year Ended November 25, 1994
Commission File No. 1-5548-1
Purpose: To amend in its entirety Part III by removing the incorporation by
reference and including directly the required information from the
Company's definitive proxy statement dated February 27, 1995.
PENOBSCOT SHOE COMPANY
(Exact name of registrant as specified in its charter)
A Maine Corporation 01-0139580
(State of Incorporation) (IRS Employer Id. No.)
450 North Main Street, Old Town, Maine 04468
(Address of principal executive offices)
207-827-4431
(Registrant's Phone)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of exchange on which registered
Common $1.00 Par Value American Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, Par Value $1.00
(Title of Class)
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
On February 10, 1995, there were 1,482,117 shares of the
registrant's common stock, $1.00 par value, outstanding. The
aggregate market value of the 680,391 share of stock held by all
non-affiliates of the registrant, based on the closing price of the
stock on the American Stock Exchange on that date, was $3,231,857.
Documents Incorporated By Reference
Incorporated Documents Form 10-K Reference
Annual Report to Stockholders Parts II, IV
for the fiscal year ended
November 25, 1994
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Identification of Directors and Directorships
<TABLE>
<CAPTION>
Shares owned
First Beneficially
Employment for Became and of record on
Name Age Past Five Years Director February 8, 1996
<S> <C> <C> <C> <C>
Irving Kagan 66 Chairman of the Board of Directors; 1960 460,499
previously Chief Executive Officer
Francis J. Guthrie 57 Senior Vice President of Corporate 1984 1,000
Marketing and Communications, Fortis Inc.
(health and life insurance and financial
services); previously, President and Chief
Executive Officer, The Guthrie Group
Paul Hansen 54 President, Chief Executive Officer; 1989 800
previously Chief Operating Officer and
Treasurer
James L. Moody, Jr. 63 Chairman of the Board, Hannaford Bros. 1971 500
Co. (wholesale and retail distributor of
groceries); Director, UNUM Corporation
(insurance)
John I. Riddle 57 Retail Real Estate and Shopping Center 1989 1,000
Developer; previously, President,
Sturbridge Yankee Workshop, Inc. (retail
firm)
Gerald E. Rudman 66 Clerk of Company, Senior Partner, Rudman 1975 7,000
& Winchell (law firm)
David L. Keane 42 Vice President of Finance and Admin- _ 500
istration and Treasurer
All directors and 471,454
officers as a group 32% of shares
(9 persons) (outstanding)
Identification of Executive Officers
This information is set forth in Part I, Item 1(c) of this report.
</TABLE>
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS AND OF ITS COMMITTEES
During the year ended November 25, 1994, the Board of Directors
held a total of four meetings.
The chairman of the Board of Directors appoints an audit committee,
a compensation committee, and a nominating committee after the annual
meeting. Messrs. Moody, Guthrie, Rudman, and Riddle constituted the Board's
audit committee for the past fiscal year. This committee reviews with the
Company's independent certified public accountants the scope of their audit
work, the results of the audit, and the examination of the Company's internal
accounting and control procedures. During the year ended November 25, 1994,
the audit committee held one meeting.
Messrs. Kagan, Rudman, Moody, Hansen, Riddle, and Guthrie
constituted the Board's compensation committee for the past fiscal year. This
committee reviews, recommends and approves the Company's compensation
policies and practices, including the level of compensation of officers of the
Company, and makes recommendations concerning compensation of directors.
During the year ended November 25, 1994, the compensation committee held
two meetings.
Messrs. Kagan, Guthrie, Moody, Rudman, Hansen, and Riddle are
members of the nominating committee. This committee identifies, reviews and
recommends individuals to fill Board vacancies. One meeting was held during
the year ended November 25, 1994.
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
COMPENSATION OF, AND TRANSACTIONS WITH, DIRECTORS,
OFFICERS AND OTHERS
The following table sets forth all direct compensation paid by the
Company during the year ended November 25, 1994, to the highest-paid officers
and directors whose aggregate direct compensation exceeded $100,000.
<TABLE>
<CAPTION>
Summary Compensation Table
Long Term
Annual Compensation Compensation
Other
Annual
Name and Salary Compensation Options
Principal Position Year ($) ($) (#)
<S> <C> <C> <C> <C>
Paul Hansen 1994 148,317 5,116 -
President and Chief Executive 1993 129,958 5,182 -
Officer (Became Chief 1992 135,048 5,188 10,000 -
Executive Officer on
January 1, 1994)
William Hoskins 1994 103,847 101 -
Vice President - Sales 1993 76,250 101 5,000
1992 * - -
Wilhelm Pfander 1994 102,547 180 -
Vice President - Manufacturing 1993 97,920 180 -
1992 101,331 180 6,000
</TABLE>
*Mr. Hoskins was employed by the Company starting on February
15, 1993. He became Vice President - Sales on April 1, 1994.
<PAGE>
Upon the death of any employee who has served the Company for at
least 15 years and has been an officer and/or director of the Company and/or
any subsidiary for at least two years, the Company will pay the sum of $5,000
and one year's salary to the employee's widow and minor children.
Mr. Hansen, Mr. Pfander, and John R. French, Vice President, Management
Information Systems, currently qualify for these benefits.
Mr. Kagan, Chairman of the Board of Directors, retired as Chief
Executive Officer of the Company on December 31, 1993. On November
26, 1993, the Board of Directors voted to provide him a supplemental
retirement benefit of $20,000 per year. During 1994, Mr. Kagan received
payments totalling $20,000 as a result of this supplemental retirement benefit.
The compensation for each outside director in fiscal 1995 consisted
of an annual retainer of $7,500, and a payment of $500 for each meeting
attended. In addition, the Chairman of the Board receives an annual retainer
of $20,000. Director compensation for fiscal 1996 is expected to continue at
this rate.
CONTRIBUTORY RETIREMENT PLAN
Since 1981, Penobscot Shoe Company has had a contributory
retirement plan covering substantially all employees. This is a defined
benefit plan and the amount of the Company's contribution with respect to
specified persons cannot be readily calculated by the actuaries of the plan.
The annual retirement benefits for each pension plan year of future service
are determined as .85% of annual earnings which are not in excess of
$16,200, and 1.5% of any excess of annual earnings over $16,200. Past
service (prior to January 1, 1988) benefits are determined for each year of
credited past service as .65% of average earnings of the three years ended
January 1, 1988 up to $16,200 and 1.5% of the average over $16,200.
All employees who are enrolled as members of the pension plan
contribute in each plan year .5% of their annual earnings up to $16,200, and
2.5% of their annual earnings in excess of $16,200. The following table shows
the annual pension benefit payable to employees, including officers, retiring
at age 65 using a constant salary. The table includes past and future service
as follows: for 15 years service, 10 years of past service and 5 years of
future service; for 25 years service, 20 and 5 respectively; for 30 years
service, 25 and 5 respectively; for 35 years service, 30 and 5; for 45 years
service, 40 and 5.
<PAGE>
<TABLE>
<CAPTION>
Approximate Annual Pension Upon Retirement at Age 65
15 Years 25 Years 30 Years 35 Years 45 Years
Compensation Service Service Service Service Service
<C> <C> <C> <C> <C> <C>
$ 25,000 $ 3,948 $ 6,321 $ 7,508 $ 8,694 $ 11,067
50,000 9,573 15,696 18,758 21,819 27,942
75,000 15,198 25,071 30,008 34,944 44,817
100,000 20,823 34,446 41,258 48,069 61,692
125,000 26,448 43,821 52,508 61,194 78,567
150,000 32,073 53,196 63,758 74,319 95,442
</TABLE>
For the highest paid officers and directors, years of credited service
for pension plan purposes and the amount of compensation for the fiscal year
on which the pension benefit calculations were based are as follows:
Years of Compensation
Name of Individual Credited Service Covered
Paul Hansen 28 $ 148,317
William Hoskins 2 103,847
Wilhelm Pfander 32 102,547
<PAGE>
1991 STOCK OPTION PLAN
The Company's 1991 Stock Option Plan (the "Plan") was adopted by
the Board of Directors on December 20, 1990 and approved by the Company's
stockholders at the 1991 annual meeting. The Plan provides that options for
the purchase of up to 75,000 shares of Common Stock may be granted, of which
33,000 shares remained available at December 1, 1994. The Plan is intended
to promote the growth and profitability of the Company by providing key
employees with additional incentive to achieve the Company's objectives and to
enable the Company to attract and retain key employees of outstanding ability.
The Plan is administered by the Compensation Committee of the Board
of Directors (the "Committee"), which has the authority to designate the key
employees eligible to participate, to prescribe the number of shares and other
terms of awards, to interpret the Plan and to make rules and regulations and
all other determinations for administering the Plan. None of the Directors
constituting the Committee is eligible to receive any stock options pursuant
to the Plan.
The exercise price of all options granted by the Committee will not
be less than 100% of the fair market value of the Common Stock on the date the
option is granted. All options granted under the Plan must expire ten years
after the date they were granted unless provision is made for an earlier
expiration. No option may be granted later than ten years following the date
the Plan was approved by the Board of Directors. The full purchase price for
shares acquired upon the exercise of an option must be paid in cash, Common
Stock, or the promissory note of the participant containing such terms as the
Committee shall specify, or a combination thereof, as the Committee may
determine.
<PAGE>
If the optionee ceases to serve the Company for reasons other than
death or total and permanent disability, the optionee may exercise his or her
option for a period equal to the earlier to occur of the end of such exercise
right as set forth in the option, or three months following such termination,
to the extent the option was exercisable prior to termination. Except as so
exercised, the option expires at the end of such three month period. If the
optionee, while in the service of the Company, dies or becomes permanently
and totally disabled at any time while he or she is entitled to exercise an
option, the optionee or his or her executor, administrator, heir or legatee
may exercise the option in full at any time up to one year following the date
of such termination or the end of the tenth year following the grant of the
option, if earlier. Options may be granted on terms different from those set
forth in the Plan in substitution for options held by employees of other
companies who become employees of the Company or a subsidiary as a
result of a merger or other acquisition transaction.
Options may not be transferred by an optionee otherwise than by will
or by the laws of descent and distribution and during the optionee's lifetime
can be exercised only by the optionee.
In the event that there is a change of control of the Company, as
defined in the Plan, each option held pursuant to the Plan will become fully
exercisable. In the event of a stock dividend, stock split, recapitalization or
other change in the Company's capital stock, the number and kind of shares
of stock or other securities subject to an option granted hereunder, and the
maximum number of shares or other securities available under the Plan, the
purchase price, and other relevant provisions, may be appropriately adjusted
by the Committee. The Committee may also make such adjustments in the
event of a material change in accounting principles or practices, a
consolidation or merger where the Company survives, a sale or acquisition of
significant amounts of stock or other property, or the occurrence of any other
event, if determined by the Committee to warrant such an adjustment to avoid
distortion of the Plan.
<PAGE>
Subject to the provision dealing with changes in control, if the
Company is involved in a merger or consolidation in which it is not the
surviving corporation, or the Company's shares are converted into, or exchanged
for, the shares of another corporation, or into or for other consideration, all
options granted hereunder shall terminate upon such event. However, if such
an event occurs, the Committee shall cause replacement options to be granted
or make all outstanding options exercisable in full for a period of twenty days
prior to such event.
<PAGE>
The Committee may amend the Plan and any option granted thereunder,
provided that, without the approval of the Stockholders of the Company, no
amendment may (except in the event of stock dividends, stock splits, certain
mergers, spin-offs, and similar events, as herein provided) increase the
maximum number of shares available under the Plan, the designation of those
eligible to participate in the Plan, reduce the minimum option price of future
options, or extend the time within which options may be granted. No
amendment may adversely affect the rights of any optionee without his or her
consent.
All grants of options under the Plan or their exercise shall be in
accordance with applicable federal and state laws and regulations, and the
Company may impose such conditions and requirements as it deems necessary
or desirable to assure such compliance.
The Plan is not intended to qualify for incentive stock option tax
treatment under the Internal Revenue Code.
During 1994, Mr. Hoskins, Vice President-Sales, was granted an option to
purchase 5,000 shares at an exercise price of $5.00 per share, the market
value of such shares at the time of the grant, exercisable over a ten-year
period. No additional options were granted during fiscal 1994.
<PAGE>
<TABLE>
<CAPTION>
Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values November 25, 1994
Shares Value Number of Unexercised Value of Unexercised
Acquired on Realized Options on November 24, 1995 Options on November 24, 1995
Name Exercise(#) ($) Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Paul Hansen ____ ____ 10,000 0 $16,250 0
Wilhelm Pfander ____ ____ 6,000 0 9,750 0
William Hoskins ____ ____ 5,000 0 0 0
David L. Keane ____ ____ 5,000 0 8,125 0
John R. French 200 $375 3,800 0 6,175 0
</TABLE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
PRINCIPAL STOCKHOLDERS
Security ownership of certain beneficial owners
Number of Shares % of Total
Beneficially Outstanding Shares
Owned on Owned on
Name February 7, 1995 February 7, 1995
Irving Kagan 460,499(a) 31.1
Mildred K. Striar 330,272(a) 22.3
Joseph R. Nerges 85,850 5.8
Leon H. Fischman 79,277 5.3
TOTAL 870,048 64.5
(a) Subject to an agreement between Mr. Kagan and Mrs. Striar
granting each a right of first refusal and certain rights of participation
with respect to the shares of the other.
The company knows of no other person owning beneficially more
than 5% of the Company's Common Stock.
Security ownership of management
This information is set forth in Part III, Item 10 of this report.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Not applicable
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
PENOBSCOT SHOE COMPANY
__________________________________
By: Paul Hansen
President and
Chief Executive Officer
__________________________________
By: David L. Keane
Vice President/Finance and
Administration