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 July 28, 1995
----------------
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, July 28, 1995, at 10 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 a three-year term;
and
2. 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 June 9, 1995 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
June 26, 1995
<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 July 28, 1995
-----------------------
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, July 28, 1995, at
10 a.m., Milwaukee time, at the Olympia Resort & Conference Center, Highway
67, Oconomowoc, Wisconsin and at any adjournments thereof.
The Company's 1995 Annual Report to Shareholders for the fiscal year
ended March 31, 1995, accompanies this Proxy Statement and appointment form
of proxy, which is being mailed to shareholders on or about June 26, 1995.
A copy of the Form 10-K (without exhibits) for the fiscal year ended
March 31, 1995 will be filed with the Securities and Exchange Commission
(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.
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, if properly executed and
returned, 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 director named in this Proxy
Statement. 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<PAGE>
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.
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 has engaged the firm
of Georgeson & Company to assist in the solicitation of proxies for a fee
of $6,000 plus reimbursement of out-of-pocket expenses. Proxies also may
be solicited by personal interview or by telephone, in addition to the use
of the mail, 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 by the beneficial owners of such shares. The Company will reimburse
such holders for their reasonable out-of-pocket expenses.
VOTING SECURITIES
Only shareholders of record at the close of business on June 9, 1995
(the "Record Date") will be entitled to notice of and to vote at the Annual
Meeting or any adjournments thereof. The total number of shares of Common
Stock outstanding on the Record Date was 11,324,645. For each matter which
may come before the Annual Meeting, each share of Common Stock, the only
class of voting securities of the Company, is entitled to one vote.
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<PAGE>
Annual Meeting, the Annual Meeting may be adjourned in order to permit the
further solicitation of proxies.
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 unless a corporation's
articles of incorporation provide otherwise. The Company's Articles of
Incorporation do not provide cumulative voting rights for the election of
directors.
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>
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 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, all 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 1998 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. At this time, the Board knows of no reason why any of the
nominees listed below may not be able to serve as a director if elected.
With the exception of Messrs. Mount and Weix who are cousins, there
are no family relationships among the executive officers and directors, and
there are no arrangements or understandings pursuant to which any of them
were elected as executive officers and/or directors or are being nominated
to serve as directors. The following tables present information concerning
the nominees for director and each director serving an unexpired term.
Position with the Company Director of
Name Age and Principal Occupation Company Since
---- --- ------------------------ ------------
Nominees for Election to Terms Expiring in 1998
Russell W. Britt 69 Retired; President, Chief 1985
Operating Officer and a
Director of Wisconsin Energy
Corp., a utility service
company, 1987-91; Vice
President, 1981-87; Executive
Officer and Director of
Wisconsin Electric Power Co.
and Wisconsin Natural Gas Co.,
subsidiaries of Wisconsin Energy
Corp., 1982-91; Director, Bank
One Wisconsin Trust Company, N.A.
<PAGE>
Ody J. Fish 70 Private Investor; President, 1985
Pal-O-Pak Insulation Co., Inc.,
an insulation manufacturing
company,1951-86; Director
Marshall Family of Mutual Funds.
Stephen W. Theobald 49 Vice Chairman and Treasurer since 1980
June 1992; Vice President-Administra-
tion, and Treasurer, 1990-92; Vice
President-Administration, 1985-90;
joined the Company in 1985.
Vernon L. Wiersma 45 President and Chief Executive 1982
Officer since August 1993;
President, June 1992-August 1993;
Executive Vice President, 1985-92;
Vice President-Operations, 1983-85;
joined the Company in 1973.
Directors Whose Present Terms Continue Until 1996
Charles J. Carey 70 Consultant since 1989; President 1989
and Chief Executive Officer,
National Food Processors Association,
a trade association, 1972-89.
Frank J. Pelisek 65 Chairman of the Board of Directors 1983
and Executive Committee of the Board
of Directors of the Company 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 & Friedrich, legal
counsel to the Company since 1965;
Director, various privately held
corporations.
Joseph B. Weix 67 Retired; Chairman of the Board and 1963
Chief Executive Officer, 1975-92;
joined the Company in 1954.
<PAGE>
Directors Whose Present Terms Continue Until 1997
Orren J. Bradley 70 Senior Vice President, Laub Group, 1985
Inc., an insurance operations
company 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., an apparel
manufacturer.
James H. DeWees 61 Retired; President and Chief 1994
Executive Officer, Godfrey Company,
a division of Fleming Companies,
Inc., a wholesale food distributor,
1984-94; Vice President, Fleming
Companies, Inc. 1987-94.
Carol Ward Knox 44 Principal, Morgan & Myers, Inc., a 1993
public relations consulting company,
since 1982.
Thomas W. Mount 64 Retired; Chairman, 1992-93; 1966
President and Chief Operating
Officer, 1975-92; joined the
Company in 1957; Director,
Fiduciary Capital Growth Fund,
Inc., and the Fiduciary Total
Return Fund, Inc.
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 EACH OF THE NOMINEES FOR DIRECTOR.
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
During the fiscal year ended March 31, 1995, the Board of Directors
of the Company held five regular meetings and one special meeting. No
incumbent director attended fewer than 75% of the aggregate total number
of meetings of the Board held and the total number of committee meetings
on which such director served during the fiscal year ended March 31, 1995.
The Board has standing Executive, Audit, Compensation, Retirement Plan
Advisory 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 Executive
Committee consists of Messrs. Pelisek (Chairman), Britt, Fish, Mount,
Theobald and Wiersma. The Executive Committee held one meeting during the
fiscal year ended March 31, 1995.
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 Audit Committee consists
of Messrs. Britt (Chairman), Bradley and DeWees. The Audit Committee held
two meetings during the fiscal year ended March 31, 1995.
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 establishment
of employee pension plans and benefits. The Compensation Committee also
is responsible for determining the recipients and terms of stock options
granted under the 1985 Incentive Stock Option Plan and the Stokely USA,
Inc. 1994 Executive Stock Option Plan. The Compensation Committee
consists of Messrs. Fish (Chairman), Carey, Pelisek and Ms. Knox, and met
four times during the fiscal year ended March 31, 1995.
The Retirement Plan Advisory Committee is responsible for overseeing
the management of the Company's various 401(k), profit sharing and
retirement plans. The Advisory Committee consists of Messrs. DeWees
(Chairman), Fish, Mount, Wiersma and Ms. Knox, and met three times during
the fiscal year ended March 31, 1995.
The Nominating Committee selects nominees for directors to stand for
election at the Company's annual meetings, and consists of Messrs. Pelisek
(Chairman), Britt, Fish and Wiersma. The Nominating Committee did not
meet during the fiscal year ended March 31, 1995. In May 1995, 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 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 Officer 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 compensated
executive officers whose compensation (salary and bonus) exceeded $100,000
during the Company's fiscal years ended March 31, 1993, 1994 and 1995.
<TABLE>
Summary Compensation Table
<CAPTION>
Long-Term
Annual Compensation<F1> Compensation
------------------------- ------------
Number of Option All Other
Name and Principal Position Year Salary Bonus Awards<F2> Compensation
- --------------------------- --- ------ ----- ---------------- ------------
<S> <C> <C> <C> <C> <C>
Vernon L. Wiersma........... 1995 $205,000 -- 30,000 $26,399
President and Chief 1994 162,167<F4> $70,000 0 7,496
Executive Officer 1993 136,500 -- 0 15,556
Stephen W. Theobald......... 1995 $160,400 -- 15,000 $25,375
Vice Chairman and Treasurer 1994 128,333<F4> $56,000 0 9,891
1993 105,000 -- 0 13,653
Kenneth C. Murray........... 1995 $118,000 -- 0 $15,652
Vice President, Canned 1994 100,000 $20,000 0 926
Sales and Marketing 1993 94,333<F5> -- 6,000 4,681
Russell J. Trunk............ 1995 $118,000 -- 6,000 $31,666
Senior Vice President, 1994 100,000 $20,000 0 16,963
1993 104,667 -- 0 22,626
Leslie J. Wilson............ 1995 $114,500 -- 0 $28,523
Vice President, Finance and 1994 100,000 $20,000 0 9,864
Chief Financial and 1993 78,889<F5> -- 10,000 14,072
Accounting Officer
<FN>
<F1> Perquisites provided to the named executive officers by the Company did not exceed
10% of each named executive officer's total annual salary during fiscal 1993, 1994 or
1995.
<F2> Except for Messrs. Wiersma and Theobald, amounts shown represent the total number of
options awarded under the 1985 Incentive Stock Option Plan during the fiscal year
indicated. Options awarded to Messrs. Wiersma and Theobald are non-qualified options
under the Internal Revenue Code and were not awarded under either the 1985 Incentive
Stock Option Plan or the 1994 Executive Stock Option Plan. No options were awarded
to the officers named above under the Stokely USA, Inc. 1994 Executive Stock Option
Plan during the fiscal years indicated.
<PAGE>
<F3> Amounts shown represent contributions by the Company for the benefit of the named
individuals pursuant to the Stokely USA, Inc. Retirement Savings Profit Sharing Plan
and the Split Dollar Life Insurance Plan in the form of premium payments on behalf of
the named executive officers during the fiscal year indicated.
<F4> The salaries of Messrs. Wiersma and Theobald were increased in August of fiscal 1995
reflecting the assumption of significant new responsibilities related to their
promotions in June of fiscal 1993, for which no salary increases had been previously
granted. On an annualized basis, the increased salaries were $175,000 for Mr.
Wiersma and $140,000 for Mr. Theobald.
<F5> Each of Mr. Murray's and Mr. Wilson's annualized compensation during fiscal 1993 was
$100,000.
/TABLE
<PAGE>
Employment Agreements
In 1992, the Company entered into Change of 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,
Mr. Wilson for two years, and Messrs. Murray and Trunk 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 defined 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 $220,000, Mr. Theobald is $170,500, Messrs. Murray
and Trunk is $124,000, and Mr. Wilson is $118,000. The amount of
the base salary and any incentive payments are reviewed regularly
by the Compensation Committee of the Board of Directors. The
Company also has entered into similar Contingent Employment
Agreements with other key officers of the Company.
In June 1992, the Company entered into an Employment
Agreement with Mr. Wilson (the "Employment Agreement") for a two-
year term which automatically is extended for a period of one
year on each anniversary date unless the Company or Mr. Wilson
has provided notice of nonrenewal within 30 days prior to the
date thereof. For purposes of the Employment Agreement, the
current base salary for Mr. Wilson is $118,000. In addition to
base salary, the Employment Agreement provides for payments from
other Company incentive compensation plans, and provides for
other benefits, including participation in any group health,
life, disability or similar insurance program and in any pension,
profit-sharing, deferred compensation, 401(k) or other retirement
plans maintained by the Company. The Employment Agreement also
provides for participation in any stock-based incentive programs
made available to executive officers of the Company. The<PAGE>
Employment Agreement will terminate in the event the Company
ceases operations and may be terminated by the Company in the
event of Mr. Wilson's disability or retirement, or for "cause"
(as defined in the Employment Agreement) at any time.
Deferred Compensation Agreements
In 1990, the Company entered into deferred compensation
agreements (the "Deferred Compensation Agreements") with Messrs.
Thomas W. Mount, former President and Chairman of the Board of
Directors of the Company, and Joseph B. Weix, former Chairman of
the Board of Directors of the Company. Under the Deferred
Compensation Agreements, the Company is obligated to pay Messrs.
Mount and Weix each deferred compensation in monthly installments
of $7,500 for a period of 120 consecutive months (or at their
election in one lump sum based upon a present value calculation
outlined in the Deferred Compensation Agreements) following their
death, disability or retirement. In the event of the death of
Messrs. Mount or Weix, their designated beneficiaries shall
receive the deferred compensation payments over the stated
period, or at the Company's election, such payments may be paid
in one lump sum based upon a present value calculation outlined
in the Deferred Compensation Agreements. The Deferred
Compensation Agreements are non-tax qualified, unfunded deferred
compensation plans. Mr. Mount retired in April 1993, and Mr.
Weix retired in June 1992, and the Company commenced the monthly
installment payments at those dates.
Benefits
Split Dollar Plan
The Company established the Split Dollar Life Insurance
Plan, effective February 1, 1990 (the "Split Dollar Plan"), in
which Messrs. Mount, Wiersma, Theobald, Murray, Trunk and Wilson
participate. The life insurance benefit is equal to four times
the executive's 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 by it on behalf of the
executive and the executive will receive the remainder of the
death benefit or the cash surrender value.
Supplemental Employee Retirement Plan
The Company established the Supplemental Employee Retirement
Plan (the "SERP") effective January 1, 1995, in which Messrs.
Wiersma, Theobald, Murray, Trunk, and Wilson participate. For
Messrs. Wiersma and Theobald the SERP provides a benefit at
retirement (based on 25 years of service) of 120 equal monthly
payments which equal, on an annual basis, 40% of the salary
(excluding bonus) individually earned during the 12 months
preceding retirement. For Messrs. Murray, Trunk, and Wilson the
SERP provides a benefit at retirement (based on 25 years of<PAGE>
service) of 120 equal monthly payments which equal, on an annual
basis, 20% of the salary (excluding bonus) individually earned
during the 12 months preceding retirement. The monthly payment
is reduced on a percentage basis of years of service that are
less than 25 at the time of retirement.
Retirement Savings Plan
The Company maintains a retirement savings plan, the Stokely
USA, Inc. Retirement Savings Profit Sharing Plan (the "Retirement
Savings 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
Retirement Savings Plan involves a Company Profit Sharing
Contribution account, a Voluntary Contribution account and a
401(k) Salary Deferral account. 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 based upon 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, and 20%
per year thereafter until 100% vested after seven years.
Participants also become 100% vested upon death, disability and
attainment of age 62. The Voluntary 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 Contribution account are 100%
vested in their contributions and the earnings thereon. Under
the Retirement Savings Plan, through the 401(k) Salary Deferral
account, participants are permitted, subject to the limitations
imposed by Section 401(k) of the Internal Revenue Code of 1986,
as amended (the "Internal Revenue Code"), to make voluntary
tax-deferred contributions in amounts between 1% and 10% of their
annual compensation. The Company may make a matching
contribution to the 401(k) Salary Deferral account in an amount
up to 25% of the first 6% of compensation deferred by the
participant for participants who meet all eligibility and
participant requirements. 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 Retirement Savings Plan, a separate account is maintained for
each type of account and each participating employee.
Participating employees direct the Retirement Savings Plan
trustee with respect to the investment of assets held in their
accounts among up to six investment options made available by the
trustee.
<PAGE>
Stock Option Plans
Incentive Stock Option Plan
The Company established the 1985 Incentive Stock Option Plan
(the "Incentive Stock Option Plan") in which key employees of the
Company and its subsidiaries, as determined by the Compensation
Committee, are eligible to participate. As of March 31, 1995,
the Company and its subsidiaries had 44 eligible employees. The
Incentive Stock Option 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.
The Compensation Committee administers the Incentive Stock Option
Plan. As of March 31, 1995, options to purchase 173,600 shares
of Common Stock had been granted and are outstanding under the
Incentive Stock Option Plan and a total of 50,950 shares of
Common Stock were available for granting under the Incentive
Stock Option Plan. However, in August 1994 the board decided not
to grant any additional options under the Incentive Stock Option
Plan.
Non-Qualified Stock Option Grants
On April 8, 1994, the Company granted to Mr. Wiersma options
to purchase 30,000 shares of Common Stock and to Mr. Theobald
options to purchase 15,000 shares of Common Stock; all at $8.50
per share, the market price at date of grant. These options are
non-qualified under the Internal Revenue Code and were not
awarded under either the 1985 Incentive Stock Option Plan or the
1994 Executive Stock Option Plan.
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 Stock Option Plan"). The Executive Stock Option
Plan was ratified by shareholders of the Company at the Annual
Meeting of Shareholders held on August 26, 1994. All key
full-time employees of the Company and its subsidiaries are
eligible to participate in the Executive Stock Option Plan. At
March 31, 1995, the Company and its subsidiaries had 50 eligible
employees. The Executive Stock Option Plan provides for the
granting of (i) incentive stock options ("ISOs"), (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 Stock Option Plan. The Compensation Committee of
the Board, or such other committee appointed by the Board,
administers the Executive Stock Option Plan. Under the Executive
Stock Option Plan, the maximum number of shares for which grants
may be made to any eligible employee may not exceed 50,000
shares.
<PAGE>
There were no individual grants of stock options under the Executive
Stock Option Plan to any of the named executive officers in the Summary
Compensation Table during fiscal 1995. The following table sets forth
certain information concerning the grant of stock options under the
Incentive Stock Option Plan and the grant of non-qualified stock options
(which were not granted under either the Incentive Stock Option Plan or the
Executive Stock Option Plan) to the executive officers listed in the
Summary Compensation Table during the fiscal year ended March 31, 1995.
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
Potential Realizable
% of Total Value at Assumed
Options Annual Rates of Stock
Granted to Exercise Price Appreication
Options Employees in Price Expiration for Option Terms
Name Granted<F1> Fiscal Year<F2> ($/Sh) Date 5% 10%
---- ----------- --------------- ------ ---- --- ---
<S> <C> <C> <C> <C> <C> <C>
Vernon Wiersma 30,000 37.5% $8.50 4/08/04 $160,368 $406,404
Stephen W. Theobald 15,000 18.8 8.50 4/08/04 80,184 203,202
Russell J. Trunk 6,000 7.5 8.50 4/08/04 32,074 81,281
- --------------
<FN>
<F1> The options are subject to a vesting schedule with 50% of the options exercisable on
April 8, 1995 and the remaining options exercisable on April 8, 1996.
<F2> The only options granted under the Incentive Stock Option Plan during the fiscal year
ended March 31, 1995 were granted to Mr. Trunk; the stock options granted to Messrs.
Wiersma and Theobald were non-qualified stock options which were not granted under
either the Incentive Stock Option Plan or the Executive Stock Option Plan. A total of
80,000 options were granted to employees during the fiscal year ended March 31, 1995.
</TABLE>
No options issued under the Incentive Stock Option Plan and Executive Stock
Option Plan were exercised by any of the named executive officers in the
Summary Compensation Table during fiscal 1995. The number and total value of
unexercised in-the-money options at March 31, 1995 are shown in the following
table:
<PAGE>
<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 30,000 $6,750 0
Stephen W. Theobald 0 0 15,000 15,000 4,125 0
Kenneth C. Murray 0 0 11,000 0 0 N/A
Russell J. Trunk 0 0 4,000 6,000 0 0
Leslie J. Wilson 0 0 10,000 0 0 N/A
- ------------
<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 $5.50 at March 31, 1995 and
the exercise price of the options as follows: $5.125 for Mr. Wiersma and $5.125 for Mr.
Theobald.
</TABLE>
<PAGE>
Directors' Compensation
Board Fees
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,
1995, were as follows: Mr. Britt, 1,436 shares; and Mr. Fish,
1,634 shares. Directors who have served two full terms (six
years) and are Board members upon attaining the age 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 Interlocks and Insider Participation
For the fiscal year ended March 31, 1995, the Compensation
Committee of the Board of Directors was composed of Messrs. Fish,
Carey, Pelisek, and Ms. Knox, who are not officers or employees
of the Company. There are no interlocks, as defined under the
rules and regulations of the SEC, between the Compensation
Committee and corporate affiliates of members of the Compensation
Committee.
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 an executive
compensation program 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:
- Provide the Company with the ability to compete for and
retain talented executives that are critical to the
Company's long term success;
- Provide incentives to achieve the Company's financial
performance objectives and strategic business initiatives
with the objective of enhancing shareholder value; and
- Provide competitive compensation packages comparable to
those offered by other peer group companies;
- 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 (including options
awarded under the Incentive Stock Option Plan and the Executive
Stock Option Plan); and (iii) executive benefits.
In determining specific cash compensation action for
executive officers for the fiscal year ended March 31, 1995, the
Compensation Committee considered the following factors:
1. Company performance relative to certain goals and objectives
in effect during the prior year.
2. Individual performance relative to certain goals and
objectives in effect during the prior year.
3. Company performance compared to broader based industry
performance.
4. Salary surveys for positions with similar responsibilities
in similar sized companies.
5. The salary freeze in effect during the prior year; with the
exception of the salary adjustments reflecting prior period
promotions for Messrs. Wiersma and Theobald, there were no
increases in executive base salaries during the fiscal year
ended March 31, 1994.<PAGE>
The annual incentive bonus is determined under the Company's
Annual Incentive Plan (the "Incentive Plan") which was developed
to recognize and reward performance and provide a total annual
cash bonus consistent with the Company's executive compensation
strategy. Under the Incentive Plan, executives earn incentive
compensation if the Company achieves various targets set for
profits (defined as income before taxes and before profit-sharing
expense) as a percent of sales. Incentive compensation earned is
established as a percentage of each officer's base salary, and
the applicable percentage is dependent upon the individual's base
salary amount. If the financial performance of the Company falls
below the threshold level, no awards will be earned. If
threshold levels of the performance indicators are achieved, the
Incentive Plan provides for payment of incentive compensation in
amounts ranging between 10% to 25% of an individual's base
salary. If target levels are achieved by the Company, the
Incentive Plan provides for payment of incentive compensation in
amounts ranging from 20% to 50% of an individual's base salary.
Incentive compensation may exceed 50% of an individual's base
salary if the Company surpasses target levels, but may not exceed
75% of an individual's base salary. Prior to payment of
incentive compensation after completion of the Company's
financial audit, the Compensation Committee certifies the
performance objectives of the Incentive Plan have been met.
Based on the above noted factors, the Committee implemented
the following increases in executive base salaries effective
April 1, 1994, for the fiscal year ending March 31, 1995; Mr.
Theobald - 8%; Mr. Trunk - 10%; Mr. Murray - 10%; and Mr. Wilson
- - 7%. No incentive bonus payments were made to executive
officers for the fiscal year ended March 31, 1995, because the
targets set for profits under the above-described Incentive Plan
were not achieved.
The base salary for the Chief Executive Officer is
determined by the Compensation Committee in general accordance
with the same criteria noted herein for determining compensation
for all executive officers. Based on those factors, the
Committee implemented a 12% increase in Mr. Wiersma's base salary
effective April 1, 1994, for the fiscal year ending March 31,
1995. No incentive bonus payments were made to Mr. Wiersma for
the year ending March 31, 1995, because the targets set for
profits under the above-described Incentive Plan were not
achieved.
In addition, for the fiscal year ended March 31, 1995, the
salaries of certain management employees including executive
officers were increased effective April 1, 1994, to reflect
discontinuance of Company provided automobiles.
The Compensation Committee believes aligning the financial
interests of management more closely with those of the
shareholders influences the creation of shareholder value. <PAGE>
Therefore, the Compensation Committee has required certain
executive stock ownership levels for certain of its executive
officers. For Messrs. Wiersma and Theobald, the requirement is
stock ownership representing a value at least two times their
annual salary, and for Messrs. Murray, Trunk and Wilson, the
stock ownership requirement 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 shares of
Common Stock until the ownership requirement is met.
To further encourage stock ownership among executive and
other key employees, the Company has two stock option plans which
it administers, the Incentive Stock Option Plan and the Executive
Stock Option Plan. The stock option plans are designed to
encourage and create ownership and retention of the Company's
Common Stock by key employees. Through the option grants, 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. For a further discussion of
the Company's stock option plans, see "Compensation of Executive
Officers and Directors - Stock Option Plans."
For a discussion of the executive benefits made available to
officers of the Company during the fiscal year ended March 31,
1995, see "Compensation of Executive Officers and Directors -
Benefits." Stock options awarded and executive benefits paid by
the Company to its executive officers were based upon each
executive officer's contribution to the success of the Company
and reflected each executive officer's position, salary and
specific responsibilities.
<PAGE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
PERFORMANCE GRAPH FOR STOKELY USA, INC.
Set forth below is a line graph comparing the cumulative
shareholder return on the shares of 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 chosen by the Company.
The peer group includes NASDAQ-listed companies included in
Standard Industrial Classification (SIC) codes 2030-2039 (Canned,
Frozen and Preserved Fruits, Vegetables and Food Specialties) and
AMEX and NYSE companies with 2030-2039 SIC codes.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information regarding
the beneficial ownership of the Company's Common Stock as of June
15, 1995,(except as noted below), (i) by each person who is known
to the Company to beneficially own more than 5% of the Common
Stock, (ii) by each of the executive officers of the Company
appearing in the Summary Compensation Table, (iii) by each
director of the Company, and (iv) by all directors and executive
officers as a group.
<TABLE>
Numbers of Percent of
shares of shares of
Common Stock Common Stock
Name Beneficially Owned<F1> Beneficially Owned
----- ---------------------- ------------------
<S> <C> <C>
David L. Babson & Co., Inc<F2>.... 1,150,200 10.16%
Winogene Kile<F3><F4>............. 701,000 6.19%
Vernon L. Wiersma<F5>............. 48,000 *
Stephen W. Theobald<F6>........... 185,691 1.64%
Russell J. Trunk<F7>.............. 7,000 *
Leslie J. Wilson<F8>.............. 10,000 *
Robert M. Brill<F9>............... 10,000 *
Robert Cook<F10>.................. 4,500 *
Eddie W. Foster<F11>.............. 5,000 *
Kenneth C. Murray<F12>............ 11,000 *
Michael A. Wilkes<F13>............ 4,000 --
Frank J. Pelisek.................. 2,400 *
Orren J. Bradley.................. 500 *
Russell W. Britt.................. 200 *
Charles J. Carey.................. 200 *
James H. DeWees................... 1,000 --
Ody J. Fish....................... 1,000 *
Carol Ward Knox................... 2,000 *
Thomas W. Mount................... 179,256 1.58%
Joseph B. Weix<F14>............... 70,480 *
All directors and executive officers as a group (18 persons) 542,247 4.79%
- ------------------
* 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 individual's
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 dispositive power.
<F2> Based on a schedule 13-G dated June 7, 1995, David L. Babson & Co., Inc.
located at One Memorial Drive, Cambridge,MA 02142-1300 has sole voting
power of 818,300 shares of Common Stock and shared voting power
of 331,900 shares of Common Stock.
<F3> Winogene Kile's address is P. O. Box 592, Oconomowoc, Wisconsin 53066.
<F4> Includes 50,000 shares of Common Stock held indirectly by Mrs. Kile's
husband, as trustee, and 40,000 shares of Common Stock held by Mrs.
Kile's husband and a son of Mr. Weix as co-trustees, as to which she
disclaims any beneficial ownership.
<F5> Includes 45,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.<PAGE>
<F6> Includes 162,191 shares of Common Stock held by Mr. Theobald as co-
trustee for which he has shared dispositive and voting power with The
First National Bank of Chicago, and 22,500 shares of Common Stock
issuable pursuant to presently exercisable stock options.
<F7> Includes 7,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F8> Includes 10,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F9> Includes 10,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F10> Includes 4,500 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F11> Includes 5,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F12> Includes 11,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F13> Includes 4,000 shares of Common Stock issuable pursuant to presently
exercisable stock options.
<F14> Includes 50,000 shares of Common Stock 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.
/TABLE
<PAGE>
INDEPENDENT AUDITORS
Deloitte & Touche LLP served as the Company's independent
auditors for the fiscal year ended March 31, 1995 and are serving
in such capacity for the current fiscal year. The appointment of
independent auditors is made annually by the Board of Directors.
The decision of the Board is based on the recommendation of the
Audit Committee of the Board, which reviews both the audit scope
and estimated audit fees. Representatives of Deloitte & Touche
LLP are expected to be present at the Annual Meeting and will
have the opportunity to make a statement if they desire to do so
and to respond to appropriate questions.
CERTAIN TRANSACTIONS
A class action lawsuit was filed on January 3, 1995, in the
United States District Court for the Eastern District of
Wisconsin, by Philip D. Freeman, a Minnesota resident, against
the Company, all of the individual members of the Board of
Directors of the Company (in both their capacity as a member of
the Board of Directors and as an executive officer, as
applicable), William Blair & Company and Dain Bosworth, Inc. The
plaintiff has brought the action pursuant to Sections 11, 12(2)
and 15 of the Securities Act of 1933, as amended, and Sections
10(b) and 20 of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and Rule 10b-5 promulgated thereto. The
plaintiff alleges that he sustained losses in connection with his
purchase of shares of Common Stock of the Company during the
period from October 17, 1994 to December 19, 1994, as a result of
the defendants' alleged misleading statements and alleged
omissions to state material facts. The relief sought for both
the plaintiff and the class is rescission and/or compensatory
damages, including pre-judgment interest, and costs and expenses
related to the bringing of the lawsuit. The Company believes the
allegations are without merit or substance, and is defending this
action vigorously.
A second class action lawsuit arising out of substantially
the same events as the Freeman lawsuit was filed on May 10, 1995,
in the United States District Court for the Eastern District of
Wisconsin, by Daniel J. Sweeney against the Company, four of its
officers and William Blair & Company and Dain Bosworth, Inc.
Like Mr. Freeman, Mr. Sweeney alleges that he sustained losses in
connection with his purchase of shares of Common Stock of the
Company during the period from October 17, 1994 to December 19,
1994, as a result of alleged misleading statements and alleged
omissions of material facts on the part of the defendants. The
Company believes the allegations of the Sweeney lawsuit are
without merit or substance and is defending this action
vigorously.
<PAGE>
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 parties, and will be
subject to approval of a majority of the Company's outside
directors.
<PAGE>
SECTION 16 COMPLIANCE
Section 16(a) of the Exchange Act 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, 1995, officers, directors and greater than ten percent
shareholders complied with all Section 16(a) filing requirements.
SHAREHOLDER PROPOSALS
Shareholders of the Company may submit matters to be
considered at the 1996 Annual Meeting of Shareholders. In order
to be included in the 1996 Proxy Statement, such written
proposals must be received on or before February 24, 1996, at the
principal offices of the Company 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 Exchange Act, 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.
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.
By Order of the Board of Directors
Robert M. Brill
Secretary
Oconomowoc, Wisconsin
June 26, 1995<PAGE>
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.
