SCHEDULE 14C
Information Required in Information Statement
Reg. 240.14c-101.
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities Exchange Act
of 1934 (Amendment No.)
Check the appropriate box:
_ Preliminary Information Statement
_ Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
x Definitive Information Statement
________Real Silk Investments, Incorporated ____________
(Name of Residtrant As Specitifed in Charter)
Payment of Filing Fee (Check the appropriate box):
x $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14c-5(g).
_ Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
1. Title of each class of securities to which transaction applies:
________________________________________________________________
2. Aggregate number of securities to which transaction applies:
________________________________________________________________
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which
the filing fee is calculated and state how it was determined.)
________________________________________________________________
4. Proposed maximum aggregate value of transaction:
________________________________________________________________
5. Total fee paid:
________________________________________________________________
_ Fee paid previously with preliminary materials.
_ 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 or Schedule and the date of its filing.
1. Amount Previously Paid:
________________________________________________________________
2. Form, Schedule or Registration Statement No.:
________________________________________________________________
3. Filing Party:
________________________________________________________________
4. Date Filed:
________________________________________________________________
NOTICE OF ANNUAL MEETING
April 17, 1998
To The Stockholders of Real Silk Investments, Incorporated:
NOTICE IS HEREBY GIVEN that the Annual Meeting of the Stockholders of
Real Silk Investments, Incorporated (the "Company") will be held on the 35th
Floor of NBD Bank, N.A., One Indiana Square, Indianapolis, Indiana at
10:00 A.M., Eastern Standard Time, on Monday, May 11, 1998, for the following
purposes:
1. To elect a Board of seven Directors to serve during the ensuing year
and until their successors shall be duly elected and qualified.
Under the circumstances outlined in the Information Statement, this
could be eight Directors.
2. To ratify or reject the selection, by a majority of those members
of the Board of Directors who were not "interested persons" of the
Company, of KPMG Peat Marwick LLP, to serve as independent auditors
of the Company for the year 1998.
3. To take action upon such other business as may properly come before
this meeting or any adjournment thereof.
Only Common Stockholders of record at the close of business April 6, 1998
are entitled to notice of and to vote at the Annual Meeting.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US
A PROXY.
By order of the Board of Directors.
___________________________
Lorretta A. Cox
Secretary
INFORMATION STATEMENT
REAL SILK INVESTMENTS, INCORPORATED
Principal Executive Office of Real Silk Investments, Inc. (the "Company"):
Real Silk Investments, Incorporated
445 N. Pennsylvania St., Suite 500
Indianapolis, Indiana 46204
WE ARE NOT ASKING FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
Voting Securities and Principal Holders Thereof
There are issued and outstanding 164,683 shares of $5 Par Value Common
Stock, the only class of voting securities of the Company.
Stockholders of record at the close of business April 6, 1998, are
entitled to notice of and to vote at the Annual Meeting. This Information
Statement is first being sent to the stockholders on or about April 17, 1998.
The following table sets forth certain information with regard to
persons known to the management of the Company to have beneficial ownership
of more than 5% of Real Silk Investments, Incorporated, outstanding stock:
Name and Address Amount and Nature Percent
Title of of Beneficial of Beneficial of
Class Owner Ownership Class (1)
$5 Par Value A Group Composed of:
Common Daniel R. Efroymson,
Mary Ann Stein,
Moriah Fund, Inc.
445 N. Pennsylvania St.
Indianapolis, Indiana 130,581 (2) 79.3
$5 Par Value First Chicago NBD Corp.
Common Chicago, Illinois 60,086 (3) 36.5
Note (1): Some of the shares reported in footnot es 2 and 3 are held in
accounts of which more than one reporting person has beneficial
ownership. These shares are reported as beneficially owned by each
such reporting person under the "shared" categories resulting in
the total shares reported in those categories exceeding the actual
number of shares involved.
Note (2): Management is advised that Moriah Fund, Inc. and Daniel R. Efroymson
exercise sole dispositive and voting power with respect to 77,000
and 5,233 shares, respectively, and that Daniel R. Efroymson and
Mary Ann Stein exercise shared voting and dispositive power with
respect to 48,348 and 6,905 shares, respectively, according to a
Schedule 13-G dated February 3, 1998.
Note (3): Management is advised that First Chicago NBD Corp. exercises sole
voting and dispositive power over 7,188 shares and shared voting
and dispositive power with respect to 52,898 shares, according to
a Schedule 13-G dated February 4, 1998.
The following table sets forth certain information as of April 6, 1998,
with respect to the beneficial ownership of the outstanding common stock of
Real Silk Investments, Incorporated, by persons named therein who are
directors who will continue in office, and by all Directors and Executive
Officers as a group as reported by each person.
Percent
Title of Name of Amount and Nature of
Class Beneficial Owner of Beneficial Ownership Class
$5 Par Value
Common Stock Daniel R. Efroymson 53,581 (4) 32.5
Loralei M. Efroymson 5,068 3.l
Herbert D. Falender l,488 .9
Mary Ann Stein 6,905 4.2
Norman C. Kleifgen, Jr. - -
Terry W. Bowmaster - -
Samuel L. Odle - -
Jeremy D. Efroymson 1,715 1.0
Gideon J. Stein, Nominee 1,440 .9
Directors and Executive Officers
as a Group (8 in number) 55,069 33.4
Note (4): The 53,581 shares reported by Daniel R. Efroymson includes 5,068
shares reported by Loralei M. Efroymson, 6,905 shares reported by
Mary Ann Stein, 1,715 shares reported by Jeremy D. Efroymson and
1,440 shares reported by Gideon J. Stein. Of the 53,581 shares
reported, Daniel R. Efroymson has sole voting and investment power
with respect to 5,233 shares and shared voting and investment power
with respect to 48,348 shares.
Directors and Executive Officers
The By-laws of the Company presently provide for a Board of Directors
composed of seven (7) members. The President of the Company intends to call
a special meeting of the Board of Directors to consider amending the By-laws
to provide for an eight (8) member Board. If the Board of Directors amends
the By-laws to increase the size of the Board, a vacancy on the Board will be
created. In that event, it is management's intention to nominate Gideon J.
Stein to be elected as a member of the Board of Directors at the annual meeting
of shareholders. If the Board of Directors does not vote to amend the By-laws,
no vacancy on the Board of Directors will be created, management will not
nominate Mr. Stein to be elected to the Board of Directors and only the
present Directors will be nominated by management. Pertinent information
relating to Mr. Stein is specified below.
Directors to be elected for the ensuing year and until their
successors shall be duly elected and qualified:
DANIEL R. EFROYMSON*, 56, Director since 1983
President and Treasurer of C ompany (1989 to present); First Vice
President of Moriah Fund, Inc. (1993 to present); Vice President of
Moriah Fund, Inc. (1986 to 1993); Secretary and Treasurer of Moriah
Fund, Inc. (1985 to present); Managing Partner, SEE Investors;
Director of Lincoln National Corporation; and Director of NBD Bank,
N.A. Indiana and its predecessor, Indiana National Bank (1985 to
1998).
LORALEI M. EFROYMSON*, 56, Director since 1989
Vice President of Company (1989 to present); Second Vice President
of Moriah Fund, Inc. (1993 to present); Assistant Vice President of
Moriah Fund, Inc. (1989 to 1993); Partner, SEE Investors.
HERBERT D. FALENDER*, 81, Director since 1969
Retired, President of Falender Iron & Metal Corporation.
NORMAN C. KLEIFGEN, JR., 61, Director since 1987
First Vice President, NBD Bank, N.A. (1994 to present); First Vice
President and Trust Officer of NBD Bank, N.A. (1994); Vice President
and Trust Officer of NBD Bank, N.A. and its predecessor, Indiana
National Bank (1982 to 1994).
TERRY W. BOWMASTER, 51, Director since 1993
Independent investor (1997 to present); Managing Associate, Oxford
Financial Advisors Corporation (1997); Senior Vice President for
Finance and Administration, Butler University (1992 to 1997).
MARY ANN STEIN*, 54, Director since 1994
President of Moriah Fund, Inc. (1989 to present); Partner, SEE
Investors.
SAMUEL L. ODLE, 48, Director since 1995
Chief Operating Officer - Clinical Services - Clarian Health
Partners, Inc. (1997 to present); Senior Vice President/Chief
Operating Officer - Methodist/IU/Riley Hospitals (l996 to 1997);
Chief Operating Officer - Clinical Services, Methodist
Hospital of Indiana, Inc. (1994 to 1996); Senior Vice President,
Hospital Operations, Methodist Hospital of Indiana, Inc.
(1986 to 1994).
GIDEON J. STEIN*, 26, Nominee a/
Partner, Monkey Rock Interactive, LLC (1997 to present); Executive
Vice President, Movie Magazine, LLC (1997 to present); Partner,
I.F. Holdings, LLC (1997 to present); Chief Executive Officer and
Partner, Axxis Magazine, Inc. (1994 to 1997).
a/ Unless the By-laws of the Company are amended to increase the Board
of Directors to eight (8) members, Mr. Stein will not be nominated
to be elected as a member of the Board of Directors.
The following are Executive Officers of the Company:
DANIEL R. EFROYMSON*, President, Treasurer, and Director
LORALEI M. EFROYMSON*, Vice President and Director
JEREMY D. EFROYMSON*, 29, Vice President of Company (1997 to present);
Attorney, Arthur and Efroymson, Attorneys at Law (1997 to present);
President and Secretary, Blue Diamond Computers, Inc. (1997);
Law Clerk, Ortiz and Associates (1996); Law Clerk, William A.
Karnezis and Associates (1994 to 1995); Associate, Prudential
Insurance (1995).
* Daniel R. Efroymson, Loralei M. Efroymson, Mary Ann Stein, Gideon J.
Stein, and Jeremy D. Efroymson are "interested persons" because they
are officers or family members of officers of, and Daniel R. Efroymson
and Mary Ann Stein are also directors of, Moriah Fund, Inc., which
holds more than 5% of the outstanding shares of the Company.
Loralei M. Efroymson is the spouse of Daniel R. Efroymson. Mary Ann
Stein is the sister of Daniel R. Efroymson. Herbert D. Falender is
the uncle of Daniel R. Efroymson and Mary Ann Stein. Gideon J. Stein
is the son of Mary Ann Stein, the nephew of Daniel R. Efroymson and
Loralei M. Efroymson, and the cousin of Jeremy D. Efroymson. Jeremy D.
Efroymson is the son of Daniel R. Efroymson and Loralei M. Efroymson,
the nephew of Mary Ann Stein, and the cousin of Gideon J. Stein.
The Board of Directors of the Company held three regularly scheduled
meetings during 1997. The Board does not have a standing audit, nominating
or compensation committee. All directors attended in excess of 75% of the
total number of meetings of the Board of Directors of the Company held during
the time he or she was a director, except Mary Ann Stein who attended two of
the three meetings held. All directors who are not employees of the Company
are paid an annual retainer of $1,000, payable in quarterly installments of
$250, and an attendance fee of $300 for each Board of Directors meeting
attended.
Executive Compensation
Name of Person Aggregate Pension or Estimated Total
Compensation Retirement Annual Benefits Compensation
from Company Benefits Upon From Company
(5) Accrued Retirement (7)
as Part of Fund
Expenses (6)
Herbert D. Falender $1,900 N/A N/A $1,900
Director
Norman Kelifgen, Jr. $1,900 N/A N/A $1,900
Director
Terry W. Bowmaster $1,900 N/A N/A $1,900
Director
Mary Ann Stein $1,600 N/A N/A $1,600
Director
Samuel L. Odle $1,900 N/A N/A $1,900
Director
Daniel R. Efroymson (8) N/A See Note 7
President and Director
Loralei M. Efroymson (8) N/A See Note 7
Vice President and Director
Jeremy D. Efroymson N/A See Note 7
Vice President
All Directors and $77,084 $3,250 See Note 7 $80,334
Executive Officers (8 persons)
Note (5): No officer of the Company receives compensation in excess of $60,000
per year and officer compensation is therefore not separately
disclosed.
Note (6): Pursuant to the Company's Defined Contribution Retirement Plan, an
aggregate total of $3,250 was paid to the Trustee of the Plan for
the calendar year 1997, on behalf of all Executive Officers. That
sum is not included in the Aggregate Compensation from Company
column but is included in the Total Compensation From Company
column for all Directors and Executive Officers. Directors who are
not officers are not eligible for the Plan.
Note (7): As a Defined Contribution Plan, estimated annual benefits are not
readily calculable.
Note (8): Director of Company who is also an officer and therefore does not
receive compensation in capacity of a director.
Recent Developments
On March 20, 1998, the Board of Directors of the Company issued a press
release to announce its intention to explore options for the future of the
Company. These options, among others, include continuing as is, merging with
another investment company or liquidating the Company. This decision is
precipitated by the anticipated termination of potential liability under the
"built-in gains tax" at the end of the current year and health problems of
the president of the Company.
The built-in gains tax is a tax on the gains in the portfolio of the
Company as of the date of its conversion to a regulated investment company,
which are realized during a ten-year period commencing with the conversion.
In the case of the Company, this period commenced January 1, 1989 and ends
January 1, 1999.
Independent Auditors
KPMG Peat Marwick LLP ("Peat Marwick"), was the Independent Auditor of
the Company beginning with the year 1995 and is being recommended to the
stockholders for ratification for the current year.
Representatives of the Independent Auditors are expected to attend the
Annual Meeting of Stockholders with the opportunity to make a statement if
they desire to do so and are expected to be available to respond to
appropriate questions by the stockholders.
Voting Procedures
An affirmative vote of a majority of the shares present at the meeting is
required for approval of matters presented. Each eligible share is entitled
to one vote.
Submission of Stockholder Proposals
Stockholder proposals to be presented at the 1999 Annual Meeting of
Stockholders must be received by the Company at its principal office on or
before December 31, 1998, to be considered for inclusion in the Company's
Information Statement for that meeting.
