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
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
STOKELY USA, INC., Commission File Number 0-13943
(Name of Registrant as Specified In Its Charter)
STOKELY USA, INC.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(i)(2).
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rules 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction
applies: COMMON STOCK
(2) Aggregate number of securities to which transaction applies:
NOT APPLICABLE
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:_/ NOT APPLICABLE
(4) Proposed maximum aggregate value of transaction: NOT
APPLICABLE
_/Set forth the amount on which the filing fee is calculated
and state how it was determined.
[ ] 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 of
Schedule and the date of its filing.
(1) Amount Previously Paid: NOT APPLICABLE<PAGE>
(2) Form, Schedule or Registration Statement No.: NOT APPLICABLE
(3) Filing Party: NOT APPLICABLE
(4) Date Filed: NOT APPLICABLE
<PAGE>
STOKELY USA, INC.
1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066
---------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on August 26, 1994
---------------------
To the Holders of Common Stock of Stokely USA, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders (the
"Annual Meeting") of Stokely USA, Inc. (the "Company") will be held on
Friday, August 26, 1994, at 10:00 a.m., Milwaukee time, at the Olympia
Resort & Conference Center, Highway 67, Oconomowoc, Wisconsin.
The Annual Meeting is for the purpose of considering and voting
upon the following matters, all of which are set forth more completely
in the accompanying Proxy Statement:
1. The election of four directors for three-year terms;
2. The ratification of the Stokely USA, Inc. 1994 Executive Stock
Option Plan (the "Executive Option Plan"); and
3. Such other matters as may properly come before the Annual
Meeting or any adjournments thereof. The Board of Directors
is not aware of any other such business.
The Board of Directors has established July 8, 1994 as the record
date for the determination of shareholders entitled to notice of and to
vote at the Annual Meeting and any adjournments thereof. Only
shareholders of record as of the close of business on that date will be
entitled to vote at the Annual Meeting or any adjournments thereof. In
the event there are not sufficient votes for a quorum or to approve or
ratify any of the foregoing proposals at the time of the Annual Meeting,
the Annual Meeting may be adjourned in order to permit further
solicitation of proxies by the Company.
By Order of the Board of Directors
Robert M. Brill
Secretary
Oconomowoc, Wisconsin
July 18, 1994
<PAGE>
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. YOUR VOTE IS
IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE
COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE
ENVELOPE PROVIDED. IF YOU ATTEND THE ANNUAL MEETING, YOU MAY VOTE
EITHER IN PERSON OR BY PROXY. ANY PROXY GIVEN MAY BE REVOKED BY YOU IN
WRITING OR IN PERSON AT ANY TIME PRIOR TO THE EXERCISE THEREOF.
<PAGE>
STOKELY USA, INC.
1055 Corporate Center Drive
Oconomowoc, Wisconsin 53066
----------------
ANNUAL MEETING OF SHAREHOLDERS
To Be Held On August 26, 1994
----------------
SOLICITATION AND VOTING OF PROXIES
This Proxy Statement is being furnished to holders of common stock,
$.05 par value per share (the "Common Stock") of Stokely USA, Inc. (the
"Company") in connection with the solicitation on behalf of the Board of
Directors of the Company of proxies to be used at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held on Friday, August 26,
1994, at 10:00 a.m., Milwaukee time, at the Olympia Resort & Conference
Center, Highway 67, Oconomowoc, Wisconsin and at any adjournments
thereof.
The 1994 Annual Report to Shareholders, including the consolidated
financial statements for the fiscal year ended March 31, 1994,
accompanies this Proxy Statement and appointment form of proxy, which is
being mailed to shareholders on or about July 18, 1994.
Regardless of the number of shares of Common Stock owned, it is
important that holders of record of a majority of the shares be
represented by proxy or present in person at the Annual Meeting.
Shareholders are requested to vote by completing the enclosed proxy and
returning it signed and dated in the enclosed postage-paid envelope.
Shareholders are urged to indicate their vote in the spaces provided on
the proxy. Proxies solicited by the Board of Directors of the Company
will be voted in accordance with the directions given therein. Where no
instructions are indicated, signed proxies will be voted FOR the
election of each of the nominees for directors named in this Proxy
Statement and FOR the ratification of the Company's Executive Option
Plan. Returning your completed proxy form will not prevent you from
voting in person at the Annual Meeting should you be present and wish to
do so.
The Board of Directors of the Company knows of no additional
matters that will be presented for consideration at the Annual Meeting.
Execution of a proxy, however, confers on the designated proxy holders
discretionary authority to vote the shares in accordance with their best
judgment on such other business, if any, that may properly come before
the Annual Meeting or any adjournments thereof.<PAGE>
Any shareholder giving a proxy has the power to revoke it any time
before it is exercised by (i) filing with the Secretary of the Company
written notice thereof (Robert M. Brill, Secretary, Stokely USA, Inc.,
1055 Corporate Center Drive, Oconomowoc, Wisconsin 53066); (ii)
submitting a duly-executed proxy bearing a later date; or (iii)
appearing at the Annual Meeting and giving the Secretary notice of his
or her intention to vote in person. If you are a shareholder whose
shares are not registered in your own name, you will need additional
documentation from your record holder to vote personally at the Annual
Meeting. Proxies solicited hereby may be exercised only at the Annual
Meeting and any adjournment thereof and will not be used for any other
meeting.
The cost of solicitation of proxies by mail on behalf of the Board
of Directors will be borne by the Company. The Company will utilize
Georgeson & Company, Inc. to assist in the solicitation of proxies for a
fee for of $6,000. Proxies also may be solicited by personal interview
or by telephone, in addition to the use of the mails by directors,
officers and regular employees of the Company without additional
compensation therefor. The Company also has made arrangements with
brokerage firms, banks, nominees and other fiduciaries to forward proxy
solicitation materials for shares of Common Stock held of record to the
beneficial owners of such shares. The Company will reimburse such
holders for their reasonable out-of-pocket expenses.
VOTING SECURITIES
The securities which may be voted at the Annual Meeting consist of
shares of Common Stock with each share entitling its owner to one vote
on all matters to be voted on at the Annual Meeting. The close of
business on July 8, 1994, has been fixed by the Board of Directors as
the record date (the "Record Date") for the determination of
shareholders of record entitled to notice of and to vote at the Annual
Meeting and any adjournments thereof. The total number of shares of
Common Stock outstanding on the Record Date was 8,324,645.
The presence, in person or by proxy, of the holders of at least a
majority of the total number of shares of Common Stock entitled to vote
is necessary to constitute a quorum at the Annual Meeting. Abstentions
are included in the determination of shares present and voting for
purposes of whether a quorum exists, while broker non-votes are not.
Neither abstentions nor broker non-votes are counted in determining
whether a matter has been approved. In the event there are not
sufficient votes for a quorum or to approve or ratify any proposal at
the time of the Annual Meeting, the Annual Meeting may be adjourned in
order to permit the further solicitation of proxies.
<PAGE>
As to the election of directors, the proxy being provided by the
Board of Directors enables a shareholder to vote for the election of the
nominees proposed by the Board, or to withhold authority to vote for one
or more of the nominees being proposed. Under the Wisconsin Business
Corporation Law, directors are elected by a plurality of the votes cast
with a quorum present and cumulative voting is not permitted. The
affirmative vote of a majority of the total shares of Common Stock
represented in person or by proxy is necessary to ratify the Company's
Executive Option Plan.
Proxies solicited hereby will be returned to the Board of
Directors, and will be tabulated by inspectors of election designated by
the Board of Directors, who will not be employed by, or a director of,
the Company or any of its affiliates.
<PAGE>
MATTERS TO BE VOTED ON AT THE ANNUAL MEETING
MATTER 1.
ELECTION OF DIRECTORS
The Board of Directors of the Company consists of eleven directors
(the "Board") divided into three classes. Directors hold office for
staggered terms of three years (or until their successors are elected
and qualified). At each annual meeting of the shareholders of the
Company, one class of directors will be elected for a term of three
years to succeed the directors whose terms are expiring. The following
four nominees, three of whom are directors serving terms which expire at
the Annual Meeting, have been nominated by the Board for submission to
the shareholders to serve a three-year term expiring at the 1997 Annual
Meeting of Shareholders.
Unless otherwise directed, each proxy executed and returned by a
shareholder will be voted FOR the election of the nominees for director
listed below. If any person named as nominee should be unable or
unwilling to stand for election at the time of the Annual Meeting, the
proxies will nominate and vote for any replacement nominee or nominees
recommended by the Board of Directors. At this time, the Board of
Directors knows of no reason why any of the nominees listed below may
not be able to serve as a director if elected.
The following tables present information concerning the nominees
for director and each director serving an unexpired term, including
tenure as a director of the Company.
Position with the Company Director
and Principal Occupation of the Company
Name Age<F1> During the Past Five Years Since
---- ------ -------------------------- --------------
Nominees for Election to Terms Expiring in 1997
Orren J. Bradley 69 Senior Vice President, Laub 1985
Group, Inc. since 1985;
Chairman, Boston Store
Division of Federated
Department Stores, Inc.
1967-85; Director Northwestern
Mutual Life Insurance
Investment Funds and Oshkosh
B'Gosh, Inc. (apparel
manufacturing)
- ------------------------
<F1> As of June 1, 1994.<PAGE>
Position with the Company Director
and Principal Occupation of the Company
Name Age <F1> During the Past Five Years Since
---- -------- -------------------------- --------------
James H. DeWees 65 Retired; President and Chief Nominee
Executive Officer, Godfrey
Company (division of Fleming
Companies, Inc.), 1984-94;
Vice President, Fleming Companies
Inc. 1987-94 (wholesale food
distributor)
Carol Ward Knox 43 Principal, Morgan & Meyers, Inc., 1993
since 1982 (public relations
consultant)
Thomas W. Mount 63 Retired; Chairman, 1992-1993; 1966
President and Chief Operating
Officer, 1975-92; joined the
Company in 1957
Directors Whose Present Terms Continue Until 1995
Russell W. Britt 68 Retired; President, Chief Operating 1985
Officer and Director of Wisconsin
Energy Corp. 1987-91; Vice President,
1981-87; Executive Officer and Director
of Wisconsin Electric Power Co. and
Wisconsin Natural Gas Co., subsidiaries
of Wisconsin Energy, 1982-91; Director,
Bank One Wisconsin Trust Company, N.A.
Ody J. Fish 69 Private Investor; President, 1985
Pal-O-Pak Insulation Co., Inc.
(manufacturer of cellulose insulation
and allied products), 1951-86; Director,
Marshall Family of Mutual Funds
Stephen W. Theobald 48 Vice Chairman and Treasurer since 1980
June 1992; Vice President Adminis-
tration and Treasurer, 1990-1992;
Vice President-Administration,
1985-90; joined the Company in 1985
Vernon L. Wiersma 44 President and Chief Executive Officer 1982
since August 1993; President, June 1992-
August 1993; Executive Vice President,
1985-92; Vice President Operations,
1983-85; joined the Company in 1973
- ------------------------
<F1> As of June 1, 1994.<PAGE>
Position with the Company Director
and Principal Occupation of the Company
Name Age <F1> During the Past Five Years Since
---- -------- -------------------------- --------------
Directors Whose Present Terms Continue Until 1996
Charles J. Carey 69 Consultant since 1989; President 1989
and Chief Executive Officer,
National Food Processors Association
(trade association), 1972-1989
Frank J. Pelisek 64 Chairman of the Board of Directors 1983
and Executive Committee of the Board
of Directors since August 1993; Acting
Chief Executive Officer and Chairman
of the Executive Committee of the Board
of Directors, June 1992-August 1993;
Partner, Michael Best & Friedreich (legal
counsel to the Company) since 1965
Joseph B. Weix 66 Retired; Chairman of the Board and 1963
Chief Executive Officer, 1975-1992;
joined the Company in 1954
- -------------------------
<F1> As of June 1, 1994.
<PAGE>
The affirmative vote of a plurality of the votes cast is required for
the election of the four nominees. Unless otherwise specified, the shares
of Common Stock represented by the proxies solicited hereby will be voted
in favor of election of the above-described nominees.
THE BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE FOR THE ELECTION OF THE
NOMINEES FOR DIRECTOR.
MATTER 2.
RATIFICATION OF THE STOKELY USA, INC.
1994 EXECUTIVE STOCK OPTION PLAN
On June 3, 1994, the Board of Directors of the Company adopted the
Stokely USA, Inc. 1994 Executive Stock Option Plan (the "Executive Option
Plan"). All key full-time employees of the Company and of any or future
subsidiaries are eligible to participate in the Executive Option Plan. The
Executive Option Plan provides for the granting of (i) incentive stock
options ("ISOs") intended to qualify as such within the meaning of Section
422 of the Internal Revenue Code of 1986, as amended (the "Code"), (ii)
non-qualified stock options ("NSOs"), and (iii) stock appreciation rights
("SARs"). Options for a total of 400,000 shares of Common Stock are
available for granting to eligible participants under the Executive Option
Plan. Under the Executive Option Plan, the maximum number of shares for
which grants may be made to any eligible employee may not exceed 50,000
shares. As of the date hereof, no option grants have been made under the
Executive Option Plan.
The Compensation Committee of the Board or such other committee
appointed by the Board (the "Committee") will administer the Executive
Option Plan. The Committee will consist of at least three members of the
Board, and a majority of the Committee shall be "disinterested persons," as
is defined under applicable federal law, at the time any ISOs, NSOs, or
SARs are granted under the Executive Option Plan. The Committee also will
have the power, subject to the express provisions of the Executive Option
Plan, to: (i) determine the recipients and the terms of options granted,
(ii) construe and interpret the Executive Option Plan and options granted
thereunder; and (iii) establish, amend, and revoke rules and regulations
for Executive Option Plan administration as necessary or expedient to make
the Executive Option Plan fully effective and in the best interests of the
Company. The Committee will determine the maximum number of options which
may be exercisable in any year. <PAGE>
The Committee will determine the expiration date (but not later than
ten years from the date the option is granted) and the exercise price of
the options. The exercise price may be paid in full in cash or, in the
discretion of the Committee, in shares of Common Stock of the Company,
valued at fair market value on the date of exercise, or in a combination of
shares of Common Stock and cash. No options may be granted under the
Executive Option Plan following the tenth anniversary of the effective date
of the Executive Option Plan (June 3, 2004). Options will be transferable
only by will or the laws of descent and distribution. Except as noted
below, the exercise price at the time of the grant of the options will be
at least 100% and 90% of the fair market value of the underlying shares of
Common Stock for ISOs and NSOs, respectively. ISOs granted to any person
who is the beneficial owner of more than 10% of the outstanding shares of
Common Stock may be exercised for a period of five years following the date
of grant and the exercise price at the time of grant must be equal to at
least 110% of the fair market value of the Common Stock on the date of
grant. The maximum fair market value of the Company's Common Stock
(determined at the time of the grant) subject to ISOs that first become
exercisable by any optionee in any calendar year is limited to $100,000.
In the event of any recapitalization, stock split, or reverse stock
split, combination or exchange of shares, stock dividend, merger in which
the Company is the surviving corporation, combination or exchange of
shares, or other capital change affecting the Common Stock of the Company,
the number of shares relating to each option and the exercise price per
share under options granted shall be adjusted to reflect such increase or
decrease in the total number of shares of the Common Stock outstanding.
In the event of death or disability of an optionee, options will be
fully vested and may be exercisable within one year from the date of such
death or disability, but not later than the date on which the options would
otherwise expire. If an optionee ceases to perform services for the
Company due to retirement, options will be fully vested and may be
exercisable within three months from the date of retirement, but not later
than the date on which the options would otherwise expire. If the
employment or service of an optionee is terminated for any reason other
than such death or disability, but is not terminated for cause or by the
optionee's voluntary termination, options which are exercisable at such
termination date may be exercised at any time within three months
thereafter, but not later than the date on which the options would
otherwise expire. Options held by employees who voluntarily terminate
employment or are terminated for cause will immediately terminate and may
not be exercised by such optionee.
<PAGE>
Options will be immediately exercisable and all restrictions shall
terminate in the event of a change of control. In addition, upon a change
of control, the Committee has sole discretion to take any of the following
actions as to any options granted prior to the change in control: (a)
provide for the purchase of any such option, upon the optionee's request,
for an amount equal to the difference between the exercise price and the
then fair market value of the shares of Common Stock subject to unexercised
options; (b) make an adjustment to any such option then outstanding as the
Committee deems appropriate to reflect such change in control; and (c)
cause any such option then outstanding to be assumed, by the acquiring or
surviving corporation, after such change in control. "Change of control"
is defined to include: (i) the acquisition of beneficial ownership of more
than 50% of the outstanding voting securities of the Company by a
corporation or other legal person (the "Acquiror") through a merger,
consolidation or reorganization; (ii) the sale of all or substantially all
of the assets of the Company to the Acquiror; and (ii) the election to the
Board, without the recommendation or approval of the incumbent Board, of
the lesser of three directors or the directors constituting a majority of
the number of directors of the Company then in office.
An NSO granted in conjunction with an SAR only shall be exercisable
during the period beginning on the third business day following the date of
release of quarterly or annual summary statements of operations and ending
on the twelfth business day following such date. SARs may be granted by
the Committee in conjunction with any NSO granted under the Executive
Option Plan, at the time of the grant of such NSO and on the basis of up to
one SAR for each share subject to an NSO. All of the terms of the
Executive Option Plan regarding NSOs also shall apply to SARs.
Accordingly, each SAR shall become exercisable, transferable and shall
expire only when and to the extent the underlying NSO is exercised,
transferred or expired. To the extent an NSO is exercised without a
simultaneous exercise of the related SARs, the related SARs shall
terminate. The Committee may require, as a condition to the exercise of an
NSO, that the optionee concurrently pay to the Company the entire amount or
portion of any taxes which the Company may be required to withhold by
reason of such exercise.
The Board of Directors may amend or discontinue the Executive Option
Plan at any time, but may not, without the consent of the individual to
whom an option has been granted, make any alteration in an option which
would adversely affect the same. Shareholder approval shall be required
for any amendment which (i) increases the aggregate number of shares
available for options under the Executive Option Plan, (ii) reduces the
minimum option price, (iii) extends the term of the Executive Option Plan
or the maximum period during which any option may be exercised, or (iv)
amends the Executive Option Plan to provide ISOs issued would fail to
qualify as incentive stock options under Section 422 of the Code.
<PAGE>
The purpose of shareholder ratification of the Executive Option Plan
is to enable the Company to continue to list its shares of Common Stock on
the NASDAQ National Market System. Shareholder ratification also will
enable recipients of options under the Executive Option Plan to qualify for
certain exemptive treatment from the short-swing profit liability
provisions of Section 16(b) of the Exchange Act of 1934, as amended, and
will qualify the Executive Option Plan for granting incentive stock options
under Section 422A of the Code.
The affirmative vote of the holders of a majority of the shares of
Common Stock represented in person or by proxy and voted at the Annual
Meeting is required for ratification of the Executive Option Plan.
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE FOR RATIFICATION OF THE
STOKELY USA, INC. 1994 EXECUTIVE OPTION PLAN
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
During the fiscal year ended March 31, 1994, the Board of Directors of
the Company held four regular meetings and one special meeting. No
incumbent director attended fewer than 75% of the aggregate total number of
meetings of the Board of Directors held and the total number of committee
meetings on which such director served during the fiscal year ended March
31, 1994. The Board of Directors of the Company has standing Executive,
Audit, Compensation and Nominating Committees.
The Executive Committee has the authority during the intervals between
Board meetings to exercise the powers of the Board, except for certain
powers reserved exclusively for the Board. The Committee was restructured
in June 1992 and presently consists of Mr. Pelisek (Chairman) and Messrs.
Bradley, Britt, Carey, Fish and Foster. The Executive Committee did not
meet during the fiscal year ended March 31, 1994.
The Audit Committee consists of Messrs. Britt (Chairman), Bradley,
Mount and Wiersma. The Audit Committee reviews the scope and timing of the
audit of the Company's financial statements by the Company's independent
public accountants and reviews with the independent public accountants the
Company's management policies and procedures with respect to auditing and
accounting controls. The Audit Committee also reviews and evaluates the
independence of the Company's accountants, approves services rendered by
such accountants and recommends to the Board the engagement, continuation
or discharge of the Company's accountants. The Company's Audit Committee
held three meetings during the fiscal year ended March 31, 1994.
The Compensation Committee is responsible for overseeing the
management of human resources activities of the Company, including
compensation for directors and executive officers, and the design of
employee pension and investment plans. The Compensation Committee is
responsible for determining the recipients and terms of stock options
granted under the 1985 Stokely Stock Option Plan and the Executive Option
Plan. The Compensation Committee consists of Messrs. Fish (Chairman),
Carey, Pelisek and Weix, and met one time during the fiscal year ended
March 31, 1994.
The entire Board of Directors of the Company acted as a Nominating
Committee for the selection of the nominees for directors to stand for
election at the Annual Meeting. The Board, acting as the Nominating
Committee, met one time during the fiscal year ended March 31, 1994. The
Company's By-Laws allow for shareholder nominations of the directors and
require such nomination to be made pursuant to timely notice to the Chief
Executive or President of the Company.
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
Executive Compensation
The following table summarizes the total compensation earned by the
Company's Chief Executive Officer and the next four highest paid executive
officers whose compensation (salary and bonus) exceeded $100,000 during the
Company's fiscal years ended March 31, 1992, 1993 and 1994, and the total
compensation earned by the named individuals during the fiscal years ended
March 31, 1992 and 1993.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
Long-Term
Annual Compensation<F1> Compensation
---------------------- ------------
Number of All Other
Name and Principal Position Year Salary Bonus Option Compensation<F3>
- --------------------------- ---- ------ ----- Awards<F2> ----------------
----------
<S> <C> <C> <C> <C> <C>
Vernon L. Wiersma 1994 $162,167 $70,000 -- $ 9,496
President and Chief Executive 1993 136,500 -- -- 17,556
Officer 1992 136,500 -- -- --
Stephen W. Theobald 1994 $128,333 $56,000 -- $11,891
Vice Chairman and Treasurer 1993 105,000 -- -- 15,653
1992 105,000 -- -- --
Kenneth C. Murray ............ 1994 $100,000 $20,000 -- $ 926
Vice President, Canned Sales & 1993 94,333<F4> -- 6,000 4,681
Marketing 1992 88,200 -- 5,000 --
Russell J. Trunk.............. 1994 $100,000 $20,000 -- $16,963
Senior Vice President, 1993 104,667 -- -- 22,626
Operations 1992 99,744 -- 4,000 --
Leslie J. Wilson.............. 1994 $100,000 $20,000 -- $ 9,864
Vice President, Finance and 1993 78,889<4> -- 10,000 14,072
Chief Financial and Accounting
Officer
<FN>
<F1> The amounts indicated do not include indirect compensation to executive officers,
including use of an automobile or an automobile allowance, which, for each executive
officer, did not exceed the lesser of $50,000 or 10% of the executive officer's
salary and bonus compensation shown above.
<F2> Amounts shown represent the total number of options awarded under the 1985 Incentive
Stock Option Plan.
<F3> Amounts shown in this column represent Directors fees paid to certain of the named
individuals and contributions by the Company for the benefit of the named
individuals pursuant to the Stokely USA, Inc. Profit Sharing Salary Deferral Plan
(the "401(k) Plan") and the Executive Split Dollar Life Insurance Plan (the "Split
Dollar Plan"). The amounts shown for each individual for the fiscal year ended
March 31, 1994 are derived from the following figures: (i) Director fees of $2,000
each to Messrs. Wiersma and Theobald, and (ii) premium payments under the Split
Dollar Plan for Messrs. Wiersma, Theobald, Murray, Trunk and Wilson of $7,496,
$9,891, $926, $16,963, and $9,864 respectively.
<F4> Mr. Murray's and Mr. Wilson's annualized compensation during fiscal 1993 was
$100,000. Mr. Murray received an increase to that level in December 1992 when he
was promoted to his present position. Mr. Wilson joined the Company in June 1992.
/TABLE
<PAGE>
Employment Agreements
In August 1992, the Company entered into Change in Control Contingent
Employment Agreements with Messrs. Wiersma, Theobald, Murray, Trunk and
Wilson (Collectively, the "Contingent Employment Agreements"). Under the
Contingent Employment Agreements, if a change of control occurs, the
Company will continue to employ Messrs. Wiersma and Theobald for three
years, and Messrs. Murray, Trunk and Wilson for one year, following the
date of the change of control. "Change of control", as defined in the
Contingent Employment Agreements, includes the acquisition of 20% or more
of the Company's Common Stock, a merger, consolidation or reorganization,
the sale of substantially all of the Company's assets or a significant
change in the composition of the Board of Directors of the Company. In the
event of a change of control, the employee shall be employed by the Company
for the applicable number of years, and shall receive a salary equal to his
salary on the date of the change of control, subject to annual upward
adjustments commensurate with increases awarded to other officers and
employees. If, after a change of control, the Company terminates the
employee for any reason other than for cause or if the employee elects to
terminate his employment, he shall continue to be paid monthly an amount
equal to his then current monthly base salary plus a certain amount of
incentive payments and shall continue to be entitled to receive all other
employee benefits and perquisites made available to other employees of
comparable status until the end of his employment term. If the Company
terminates the employee for "cause" (as described in the Contingent
Employment Agreements), the employee is entitled to receive only his
compensation through the date of termination. For purposes of the
Contingent Employment Agreements, the current base salary for Mr. Wiersma
is $205,000, Mr. Theobald is $160,400, Messrs. Murray and Trunk is
$118,000, and Mr. Wilson is $114,500. The amount of the base salary and
any incentive payments are reviewed regularly by the Compensation Committee
of the Board.
Benefits
Executive Split Dollar Insurance Program
The Company established a Split Dollar Life Insurance Plan, effective
February 1, 1990 (the "Split Dollar Plan"), in which Messrs. Wiersma,
Theobald, Murray, Trunk and Wilson participate. The life insurance benefit
is equal to four times the executives' salary. The executive pays the
economic value of the insurance and the Company pays the balance of the
premium. Upon the executive's death or the retirement of the executive,
the Company will receive all premiums paid on behalf of the executive and
the executive will receive the remainder of the death benefit or the cash
surrender value.
Retirement Savings Plan
The Company maintains a retirement savings plan, the Stokely USA, Inc.
Profit Sharing Salary Deferral Plan (the "Plan"), covering all of its
eligible employees. Employees are eligible to participate after completing
a twelve month period of 1,000 or more hours of employment. The Plan
involves a Company Profit Sharing Contribution account, a Voluntary Savings
Contribution account and a 401(k) Salary Deferral account.
<PAGE>
Subject to the Company's operating results, the Company may make
contributions up to 8% of pre-tax profits to the Profit Sharing
Contribution account which would be allocated to participants pro rata to
their eligible compensation. Participants become 20% vested in the profit
sharing contributions credited to their accounts and the earnings thereon
after three years of credited service, with vesting increasing 20% per year
thereafter to 100% vesting after seven years. Participants also become
100% vested on death, disability and attainment of age 62.
The Voluntary Savings Contribution account permits participants to
make voluntary after-tax savings contributions in amounts between 2% and
10% of their annual compensation. Participants in the Voluntary Savings
Contribution account are 100% vested in their contributions and the
earnings thereon.
The 401(k) Salary Deferral account permits participants, subject to
the limitations imposed by Section 401(k) of the Code, to make voluntary
tax deferred contributions in amounts between 1% and 10% of their annual
compensation. The Company makes a matching contribution to the 401(k)
Salary Deferral account in an amount equal to 25% of the first 6% of
compensation deferred by the participant for those participants currently
employed. Participants in the 401(k) Salary Deferral account are 100%
vested in their contributions, the Company's matching contribution and the
earnings thereon.
Under the Plan, a separate account is maintained for each type of
account and each participating employee. Participating employees direct
the Plan trustee with respect to the investment of assets held in their
accounts among up to six investment options made available by the trustee.
Incentive Stock Option Plan
The Company established the 1985 Incentive Stock Option Plan (the
"Incentive Stock Plan") in which key employees of the Company and its
subsidiaries, as determined by the Compensation Committee, are eligible to
participate. The Incentive Stock Plan authorizes the grant of options to
purchase shares of Common Stock intended to qualify as incentive stock
options under Section 422A of the Internal Revenue Code ("Incentive Stock
Options"). As of March 31, 1994, options to purchase 142,000 shares of
Common Stock were outstanding under the Incentive Stock Plan and a total of
82,550 shares of Common Stock were available for granting under the
Incentive Stock Plan. There were no individual grants of stock options
under the Incentive Stock Plan to any of the executive officers listed in
the Summary Compensation Table during the fiscal year ended March 31, 1994.
<PAGE>
The following table sets forth certain information concerning the exercise
of stock options granted under the Incentive Stock Plan by each of the
executive officers named in the Summary Compensation Table during the fiscal
year ended March 31, 1994.
<TABLE>
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<CAPTION>
Value of
Number of Unexercised
Number of Unexercised In-the-Money
Shares Options Options at
Acquired Value at Fiscal Year End Fiscal Year End <F1>
Name on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Vernon L. Wiersma 0 $ 0 30,000 0 $55,250 $0
Stephen W. Theobald 0 0 15,000 0 21,630 0
Kenneth L. Murray 0 0 8,000 3,000 0 0
Russell J. Trunk 0 0 4,000 0 0 0
Leslie J. Wilson 0 0 10,000 0 16,250 0
<FN>
<F1> The value of Unexercised In-the-Money Options is based upon the difference between the
fair market value of the securities underlying the options of $8.00 at March 31, 1994,
and the exercise price of the options; $5.825 for Mr. Wiersma, $6.558 for Mr. Theobald,
$10.72 for Mr. Murray, $10.00 for Mr. Trunk, and $6.375 for Mr. Wilson.
</TABLE>
<PAGE>
Directors' Compensation
Board Fees
Directors who are officers or employees of the Company receive
$500 per quarter for service as members of the Board of Directors
or Committees thereof. Non-employee directors receive compensation
of $6,000 per year of service on the Board plus $500 for each Board
or Committee meeting attended. Directors may defer all or any
portion of such compensation under a Directors' Deferred
Compensation Plan adopted in 1985. Deferred compensation is
credited to the account of a participating director in the form of
"phantom stock" of the Company based on the market price at the
time of each quarterly credit. Shares credited to the accounts of
directors electing to participate in the Directors' Deferred
Compensation Plan during the fiscal year ended March 31, 1994 were
as follows: Mr. Bradley, 1815.5784 shares; Mr. Britt, 7470.7056
shares; Mr. Carey, 2407.4716 shares; Mr. Fish, 7511.9397 shares;
and Mr. Foster, 4056.7471 shares. Directors who have served two
full terms (six years) and are Board members upon attaining the age
of 65 become eligible for retirement compensation of $500 per month
upon completion of service.
COMPENSATION COMMITTEE REPORT
Compensation Committee
The Compensation Committee of the Company reviews and
establishes compensation levels and benefits applicable to
executive officers and employees of the Company and makes
recommendations with respect to all issues pertaining to executive
compensation for ratification by the Board of Directors of the
Company.
Compensation Committee Report
Under rules established by the Securities and Exchange
Commission (the "SEC"), the Company is required to provide certain
data and information regarding the compensation and benefits
provided to executive officers of the Company. The rules require a
report of the Compensation Committee which explains the rationale
and considerations that led to fundamental compensation decisions
affecting such individuals. The Compensation Committee of the
Company has prepared the following report, at the direction of the
Board of Directors of the Company, for inclusion in this Proxy
Statement.
<PAGE>
It is the policy of the Company to maintain compensation
programs which will attract, motivate, retain and reward employees
at all levels of the organization and provide appropriate
incentives intended to generate long-term financial results which
will benefit the Company and the shareholders of the Company. The
executive compensation program of the Company incorporates a pay-
for-performance policy that compensates executives for both
corporate and individual performance. The executive compensation
program is designed to achieve the following objectives:
1. Provide the Company with the ability to compete for and
retain talented executives that are critical to the
Company's long term success;
2. Provide incentives to achieve the Company's financial
performance objectives and strategic business
initiatives with the objective of enhancing shareholder
value;
3. Provide competitive compensation packages comparable to
those offered by other peer group companies; and
4. Reward executives for individual performance in long-term
strategic management.
The Company's executive compensation package consists of three
major components: (i) cash compensation, including base salary and
an annual incentive bonus; (ii) long-term incentive compensation in
the form of stock options awarded under the Incentive Stock Plan;
and (iii) executive benefits.
In determining specific compensation action during the fiscal
year ended March 31, 1994, the Compensation Committee reviewed the
Company's operating results compared to certain goals and
objectives of the restructuring program and to broader based
industry performance. The compensation levels for executive
officers of the Company have remained essentially static during the
past three fiscal years as a result of the disappointing
performance of the Company during the last several years and the
reorganization of the management team in June 1992. However, the
salaries of Messrs. Wiersma and Theobald were increased in August
of fiscal 1994 reflecting the assumption of significant new
responsibilities related to promotions in June of fiscal 1993, for
which no salary increases had previously been granted. With this
exception, all management salaries were frozen during fiscal 1994
as were salaries and wages for all non-union positions, however,
salary increases were granted in the case of promotions. While the
salaries of executive officers were held constant, except as noted,
bonuses were paid to executive officers and other key management
personnel based on the accomplishment of specific objectives
outlined in the restructuring program.
<PAGE>
Mr. Wiersma joined the Company in 1973, and assumed the
position of President in June 1992 as a result of the
reorganization of the Company's management team. The Board of
Directors of the Company believes a key component of the
President's compensation evaluation should be responsibilities
assumed and Company performance. Mr. Wiersma's base salary
increased to $175,000 in August of fiscal 1994 from $136,500 in
fiscal 1993. The salary adjustment was made in recognition of the
fact that Mr. Wiersma had performed the duties of President for
over one year with no salary adjustment and concurrent with his
promotion to Chief Executive Officer. The bonus paid to Mr.
Wiersma in fiscal 1994 was based on the achievement of specific
goals under the restructuring program relating to operating income,
cash flow and debt reduction.
The Compensation Committee believes that aligning the
financial interests of management more closely with those of the
shareholders substantially influences the creation of shareholder
value. The Committee has, therefore, established requirements for
executive stock ownership. For Mr. Wiersma and Mr. Theobald, the
requirement is stock ownership representing a value at least two
times their annual salary, and for Messrs. Murray, Trunk and
Wilson, it is value representing at least one times their annual
salary. Executives are required to use a portion of any annual
cash bonus received to purchase Stokely Common Stock until the
ownership requirement is met.
To further encourage stock ownership among executives and
other key employees, the Company adopted the Stokely USA, Inc. 1994
Executive Stock Option Plan (the "Executive Option Plan") in June
1994 which is being submitted for shareholder ratification at the
Annual Meeting. The Executive Option Plan is designed to encourage
and create ownership and retention of the Company's Common Stock by
key employees. Through the option grants available under the
Executive Option Plan, the objective of aligning key employees'
long-range interests with those of shareholders may be met by
providing key employees with the opportunity to build, through
achievement of corporate goals, a meaningful stake in the Company.
Options are granted under the program in conjunction with cash
purchases of stock as outlined in the preceding paragraph.
For a discussion of the executive benefits made available to
officers of the Company during the fiscal year ended March 31,
1994, see "Benefits." Stock options awarded and executive benefits
paid by the Company to its officers were based upon each officer's
contribution to the success of the Company and reflected each
officer's position, salary and specific responsibilities.
<PAGE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPH FOR STOKELY USA, INC.
Set forth below are two line graphs comparing the cumulative
shareholder return on the Common Stock, based on the market price
of the Common Stock and assuming reinvestment of dividends, with
the cumulative total return of companies included in the Center for
Research on Security Prices Index for NASDAQ Stock Market companies
and a peer group of companies chosen by the Company. The peer
group in the first graph includes NASDAQ listed companies included
in Standard Industrial Classification (SIC) codes 2030-2039
(Canned, Frozen and Preserved Fruits, Vegetables and Food
Specialties). This peer group is consistent with the peer group
used in the performance graph in last year's proxy statement.
The peer group in the second graph includes the companies in
the first graph and additionally AMEX and NYSE companies with 2030-
2039 SIC codes. The Company intends to utilize this broader peer
group index in its' performance graphs for future fiscal years.
The change is being made because the Company believes the broader
peer group is a more meaningful and representative comparison. The
small size of the former group (eight companies) may result in the
performance of a single company having a distorting impact on the
entire peer group.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth the beneficial ownership of
shares of Common Stock as of June 15, 1994 by each shareholder
known to the Company who beneficially owns more than 5% of the
shares of Common Stock outstanding, as disclosed in certain reports
regarding such ownership filed with the Company and with the
Securities and Exchange Commission, in accordance with Sections
13(d) or 13(g) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), by each director of the Company, by each of
the executive officers of the Company appearing in the Summary
Compensation Table below, and by all directors and executive
officers as a group.
Number of Shares
Name Beneficially Owned<F1> Percent of Class
---- ---------------------- ----------------
Winogene Kile <F2>................. 741,000 <F3> 8.9%
Stephen W. Theobald................ 266,297 <F4> 3.2
Thomas W. Mount.................... 179,256 2.1
Joseph B. Weix..................... 140,480 <F5> 1.7
Vernon L. Wiersma.................. 33,000 *
Kenneth C. Murray.................. 11,000 *
Russell J. Trunk................... 4,000 *
Leslie J. Wilson................... 10,000 *
Frank J. Pelisek................... 1,400 *
Ody J. Fish........................ 1,000 *
Carol Ward Knox.................... 1,000 *
Orren J. Bradley................... 500 *
Charles J. Carey................... 200 *
Dr. E. Michael Foster.............. 200 *
Russell W. Britt................... 200 *
All directors and executive officers
as a group (17 persons)....... 661,033 7.9%
- ---------------------------------
* Amount represents less than 1% of the total shares of Common Stock
outstanding.
[FN]
<F1> Unless otherwise indicated, includes shares of Common Stock held
directly by the individuals as well as by members of such
individuals' immediate family who share the same household, shares
held in trust and other indirect forms of ownership over which
shares the individuals exercise sole or shared voting and/or
investment power.
<F2> Winogene Kile's address is P.O. Box 592, Oconomowoc, Wisconsin
53066.
<F3> Includes 50,000 shares held indirectly by Mrs. Kile's husband, as
trustee, and 40,000 shares held by Mrs. Kile's husband and a son of
Mr. Weix as co-trustees, as to which she disclaims any beneficial
ownership.<PAGE>
<F4> Includes 162,191 shares held by Mr. Theobald as co-trustee for
which he has shared dispositive and voting power with The First
National Bank of Chicago and 88,106 shares held by Mr. Theobald as
co-trustee for which he has shared dispositive and voting power
with Bank One Wisconsin Trust Company, N.A. and as to which he
disclaims any beneficial interest.
<F5> Includes 50,000 shares held by Mr. Weix as co-trustee for which he
has shared dispositive and voting power and as to which he
disclaims any beneficial interest.
<PAGE>
CERTAIN TRANSACTIONS
The Company has adopted a policy governing related party
transactions providing that any transaction by and between the Company
and officers, directors, principal shareholders or their affiliates will
be for bona fide business purposes and on terms no less favorable to the
Company than those obtainable in arms-length transactions with
unaffiliated third parties, and will be subject to approval of a
majority of the Company's outside directors.
SECTION 16 COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Company's officers and directors, and persons who
own more than ten percent of the shares of Common Stock outstanding, to
file reports of ownership and changes in ownership with the SEC and the
National Association of Securities Dealers, Inc. Officers, directors
and greater than ten percent shareholders are required by regulation to
furnish the Company with copies of all Section 16(a) forms they file.
Based upon review of the information provided to the Company, the
Company believes that during the fiscal year ended March 31, 1994,
officers, directors and greater than ten percent shareholders complied
with all Section 16(a) filing requirements.
SHAREHOLDER PROPOSALS
Shareholders of Stokely may submit matters to be considered at the
1995 Annual Meeting of Shareholders. In order to be included in the
1995 Proxy Statement, such written proposals must be received on or
before March 15, 1995, at the principal offices of Stokely USA at 1055
Corporate Center Drive, Oconomowoc, Wisconsin, 53066-0248, Attention:
Robert M. Brill, Secretary. If such proposal is in compliance with all
of the requirements of 17 C.F.R. Sec 240.14a-8("Rule 14a-8") of the
Rules and Regulations under the Securities Exchange Act of 1934, as
amended, it will be included in the proxy statement and set forth on the
appointment form of proxy issued for such annual meeting of
shareholders. It is urged that any such proposals be sent certified
mail, return receipt requested.
<PAGE>
OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING
The Board of Directors knows of no business which will be presented
for consideration at the Annual Meeting other than as stated in the
Notice of Annual Meeting of Shareholders. If, however, other matters
are properly brought before the Annual Meeting, it is the intention of
the persons named in the accompanying proxy to vote the shares
represented thereby on such matters in accordance with their best
judgment.
A copy of the Form 10-K (without exhibits) for the year ended March
31, 1994 is filed with the SEC and will be furnished without charge to
shareholders of record upon written request to Stokely USA, Inc., Robert
M. Brill, Secretary, 1055 Corporate Center Drive, Oconomowoc, Wisconsin
53066.
By Order of the Board of Directors
Robert M. Brill
Secretary
Oconomowoc, Wisconsin
July 18, 1994
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED TO SIGN
AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-PAID
ENVELOPE.
