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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A AMENDMENT NO. 1
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended Commission File Number
September 28, 1996 0-20242
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CENTRAL GARDEN & PET COMPANY
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(Exact name of registrant as specified in its charter)
Delaware 68-0275553
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
3697 Mt. Diablo Boulevard, Lafayette, California 94549
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(Address of principal executive offices) (Zip Code)
Telephone Number: (510) 283-4573
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
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None None
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Securities registered pursuant to Section 12(g) of the Act:
Common Stock
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(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K ((S) 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [X]
At December 11, 1996, the aggregate market value of the registrant's Common
Stock and Class B Stock held by non-affiliates of the registrant was
approximately $243,820,529 and $275,378, respectively.
At December 11, 1996, the number of shares outstanding of registrant's
Common Stock was 12,607,290. In addition, on such date the registrant had
outstanding 1,865,939 shares of its Class B Stock which is convertible into
Common Stock on a share-for-share basis.
DOCUMENTS INCORPORATED BY REFERENCE
None.
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Item 10 of the Annual Report filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended September 28, 1996 is
hereby amended in full as follows:
Item 10 - Directors and Executive Officers of the Registrant
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IDENTIFICATION OF DIRECTORS
The persons named below are nominees for director to serve until the next
Annual Meeting of Stockholders and until their successors shall have been
elected. The nominees constitute the present Board of Directors.
Set forth below is certain information concerning the nominees which is
based on data furnished by them.
<TABLE>
<CAPTION> SERVED AS
BUSINESS EXPERIENCE DURING PAST DIRECTOR
NOMINEES FOR DIRECTOR AGE FIVE YEARS AND OTHER INFORMATION SINCE
- --------------------- --- -------------------------------- ---------
<S> <C> <C> <C>
William E. Brown........... 55 Chairman of the Board and Chief Executive Officer 1980
since 1980.
Glenn W. Novotny........... 49 President since June 1990. Prior to June 1990, 1990
Mr. Novotny was with Weyerhaeuser Corporation in
a variety of capacities.
Lee D. Hines, Jr. ......... 50 Chief Operating Officer of Promotions Distributor Services Corporation 1992
(telemarketing, distribution and fulfillment company servicing the
entertainment industry) since November 1996. From June 1993 to November
1996, Mr. Hines was a self-employed consultant. From April 1991 until
June 1993, Mr. Hines was Executive Vice President and Chief Financial
Officer of the Company. From May 1990 to April 1991, Mr. Hines was
President and Chief Executive officer of International Tropic-Cal, Inc.
(designer and marketer of sunglasses and hair accessories).
Daniel Hogan............... 68 Self-employed consultant. Prior to his retirement in 1987, Mr. Hogan 1993
was a Vice President of Chevron Chemical Company and General Manager of its
Ortho Consumer Products Division.
</TABLE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission.
Officers, directors and greater than ten-percent shareholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that, during the period from
October 1, 1995 to September 28, 1996 all filing requirements applicable to its
officers, directors, and greater than ten-percent beneficial owners were
complied with.
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Item 11 of the Annual Report filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended September 28, 1996 is
hereby amended in full as follows:
Item 11 - Executive Compensation
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COMPENSATION OF EXECUTIVE OFFICERS
The compensation paid to the Company's Chief Executive Officer and the only
other executive officers who received compensation in excess of $100,000 for
services in all capacities to the Company and its subsidiaries during fiscal
1994, 1995 and 1996 is set forth below.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Annual Compensation Compensation Awards
----------------------------------- ----------------------- All
Other Annual Restricted Securities Other
Compensation Stock Underlying Compen-
Name and Principal Position Year(1) Salary($) Bonus($) ($) Awards(#) Options(#) sation($)
- --------------------------- ------- --------- -------- ------------ ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
William E. Brown 1996 $300,000 -- -- -- 30,000 --
Chairman and Chief 1995 $200,000 -- -- -- -- --
Executive Officer 1994 $200,000 -- -- -- -- --
Glenn W. Novotny 1996 $257,908 $15,000 -- -- 30,000 --
President 1995 $199,841 -- -- -- 37,000 --
1994 $207,295 -- $38,036(2) -- 9,487 --
Neill J. Hines 1996 $160,656 -- -- -- 10,000 --
Executive Vice President 1995 $103,508 -- -- -- 21,000 --
1994 $132,538 -- -- -- 5,128 --
Robert B. Jones 1996 $118,165 -- -- -- 10,000 --
Vice President, Chief 1995 $ 90,896 -- -- -- 21,000 --
Financial Officer 1994 $112,000 $25,000 -- 10,000(3) -- --
</TABLE>
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(1) In July 1995, the Company changed its fiscal year end to be the last
Saturday in September; as a result the fiscal year ending September 30,
1995 ("fiscal 1995") was a nine month period.
(2) Includes for 1994, reimbursement to Mr. Novotny of moving expenses in the
amount of $30,456. While the named executive officers enjoy certain
perquisites, for fiscal years 1994, 1995 and 1996 these did not exceed
the lesser of $50,000 or 10% of each officer's salary and bonus.
(3) The fair market value of these shares on the grant date was $107,500. The
fair market value on the grant date, however is not necessarily indicative
of the restricted stock's real value, which is impossible to determine
until the vesting date; it is at this point that executives recognize
income on the stock and must pay taxes on it. As of the end of fiscal 1996,
the aggregate restricted stock holdings for such executive officer
consisted of 10,000 shares worth $207,500 at the then-current fair market
value (as represented by the closing price of the Company's Common Stock on
September 27, 1996), without giving effect to the diminution of value
attributable to the restrictions on such stock. Dividends are paid on the
restricted shares to the extent payable on the Company's Common Stock
generally.
The following table sets forth certain information regarding stock options
granted during fiscal 1996 to the executive officers named in the foregoing
Summary Compensation Table. None of such persons received awards of stock
appreciation rights during fiscal 1996.
3
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OPTIONS GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Individual Grants Potential Realizable
--------------------------------------------------------- Value at Assumed
Number of Percent of Annual Rates of Stock
Securities Total Options Price Appreciation for
Underlying Granted to Exercise Option Term(3)
Options Employees in Base Price Expiration ----------------------
Name Granted(#)(1) Fiscal Year ($/Sh)(2) Date 5%($) 10%($)
- ---- ------------- ------------- ---------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C>
William E. Brown................. 30,000 6.5% $18.125 7/24/02 $150,228 $331,964
Glenn W. Novotny................. 30,000 6.5% $18.125 7/24/02 $150,228 $331,964
Neill J. Hines................... 10,000 2.2% $18.125 7/24/02 $ 50,076 $110,655
Robert B. Jones.................. 10,000 2.2% $18.125 7/24/02 $ 50,076 $110,655
</TABLE>
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(1) All options granted in fiscal 1996 are exercisable in full, commencing one
year prior to expiration. Under the terms of the Company's Stock Option
Plan, the Audit and Compensation Committee retains discretion, subject to
plan limits, to modify the terms of outstanding options.
(2) All options were granted at fair market value at date of grant.
(3) Realizable values are reported net of the option exercise price. The dollar
amounts under these columns are the result of calculations at the 5% and
10% rates (determined from the price at the date of grant, not the stock's
current market value) set by the Securities and Exchange Commission and
therefore are not intended to forecast possible future appreciation, if
any, of the Company's stock price. Actual gains, if any, on stock option
exercises are dependent on the future performance of the Common Stock as
well as the optionsholder's continued employment through the vesting
period. The potential realizable value calculation assumes that the
optionholder waits until the end of the option term to exercise the option.
There were no option exercises during fiscal 1996 by any of the executive
officers listed. The following table sets forth certain information with
respect to stock options held by each of the Company's executive officers as of
September 28, 1996.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-the-Money Options
Options at FY-End(#) at FY-End($)
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Exercisable/ Exercisable/
Name Unexercisable Unexercisable
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<S> <C> <C>
William E. Brown................................. 0/30,000 0/$ 78,750
Glenn W. Novotny................................. 10,360/77,360 $113,960/$702,250
Neill J. Hines................................... 5,718/36,718 $ 62,898/$381,600
Robert B. Jones.................................. 530/31,530 $ 5,830/$381,600
</TABLE>
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Item 12 of the Annual Report filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended September 28, 1996 is
hereby amended in full as follows:
Item 12 - Security Ownership of Certain Beneficial Owners and Management
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OWNERSHIP OF MANAGEMENT AND PRINCIPAL STOCKHOLDERS
The following table indicates, as to (i) each person who is known by the
Company to own beneficially more than 5% of the outstanding shares of Common
Stock and Class B Stock, (ii) each director, (iii) each named executive officer
and (iv) all directors and executive officers as a group, the number of shares
and percentage of the Company's stock beneficially owned as of December 27,
1996.
<TABLE>
<CAPTION>
Shares Beneficially Owned
as of December 27, 1996
-------------------------
Number of Number of
Beneficial Owner Class B Shares Common Shares Percent(1)
---------------- -------------- ------------- ----------
<S> <C> <C> <C>
William E. Brown(2)...................................... 1,806,359 -- 12.5%
Putnam Investments(3).................................... -- 1,551,931(4) 10.7%
Warburg, Pincus Counsellors, Inc.(5)..................... -- 1,455,000(6) 10.0%
Edgemont Asset Management Corporation(7)................. -- 1,000,000(4) 6.9%
Strong Capital Management, Inc.(8)....................... -- 776,475(4) 5.4%
Fidelity Management & Research Co.(9).................... -- 735,800(4) 5.1%
Glenn W. Novotny......................................... -- 92,669(10) *
Lee D. Hines, Jr......................................... -- 51,000 *
Daniel Hogan............................................. -- 6,000 *
Neill J. Hines........................................... 45,548 37,807(11) *
Robert B. Jones.......................................... -- 12,538(12) *
All directors and officers as a group (six persons)...... 1,851,907 200,014(13) 14.2%
</TABLE>
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(*) Less than 1%.
(1) Represents the number of shares of Class B Stock and Common Stock
beneficially owned by each stockholder as a percentage of the total number
of shares of Class B Stock and Common Stock outstanding.
(2) The address of Mr. Brown is 3697 Mt. Diablo Boulevard, Lafayette,
California 94549. Mr. Brown may be deemed to be a "control person" of the
Company within the meaning of the rules and regulations of the Securities
and Exchange Commission by reason of his stock ownership and positions with
the Company.
(3) The address of Putnam Investments is One Post Office Square, 12th Floor,
Boston, Massachusetts 02109.
(4) Based on a Schedule 13F filed with the Securities and Exchange Commission
reflecting beneficial ownership as of September 30, 1996.
(5) The address of Warburg, Pincus Counsellors, Inc. is 466 Lexington Avenue,
New York, New York 10017.
(6) Based on a Schedule 13G filed with the Company reflecting beneficial
ownership as of November 30, 1996. Warburg, Pincus Counsellors, Inc. has
the sole power to dispose of 1,451,900 shares of the Company's Common
Stock. Warburg, Pincus Counsellors, Inc. serves as an investment advisor to
many accounts which own shares of the Company's Common Stock. None of these
accounts, individually own more than 5% of the Company's Common Stock.
5
<PAGE>
(7) The address of Edgemont Asset Management Corporation is 140 East 45th
Street, 43rd Floor, New York, New York 10017.
(8) The address of Strong Capital Management, Inc. is 100 Heritage Reserve,
Menomenee Falls, Wisconsin 53051.
(9) The address of Fidelity Management & Research Co. is 82 Devonshire Street,
Boston, Massachusetts 02109-3614.
(10) Includes 10,360 shares issuable upon exercise of outstanding options
exercisable within 60 days of December 27, 1996.
(11) Includes 5,718 shares issuable upon exercise of outstanding options
exercisable within 60 days of December 27, 1996.
(12) Includes 530 shares issuable upon exercise of outstanding options
exercisable within 60 days of December 27, 1996.
(13) Includes employee stock options exercisable within 60 days of December 27,
1996.
Item 13 of the Annual Report filed pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended September 28, 1996 is
hereby amended in full as follows:
Item 13 - Certain Relationships and Related Transactions
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COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Lee D. Hines, Jr., a member of the Board of Directors and the Audit and
Compensation Committee, performed certain consulting services for the Company
during fiscal 1996 for which he received compensation of $40,000.
TRANSACTIONS WITH THE COMPANY
The Company leases a warehouse facility and certain related equipment in
Visalia, California from Road 80 Investors, a California general partnership
controlled by William E. Brown. In fiscal 1996, the Company paid approximately
$155,688 to Road 80 Investors under this lease.
On December 30, 1992, in connection with an acquisition, the Company issued
a note in the amount of $2.4 million payable in four equal annual installments
commencing in 1994. The note bears interest at 1% per annum below prime rate.
This indebtedness is secured by shares of Class B Stock owned by Mr. Brown.
6
<PAGE>
Signatures
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Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Date: January __, 1997
CENTRAL GARDEN & PET COMPANY
By /s/ WILLIAM E. BROWN
-------------------------------------
William E. Brown
Chairman of the Board
7
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated.
<TABLE>
<CAPTION>
Signature Capacity Date
--------- -------- ----
<S> <C> <C>
/s/ WILLIAM E. BROWN Chairman and Chief Executive January __, 1997
- ------------------------ Officer (Principal Executive
William E. Brown Officer
/s/ ROBERT B. JONES Vice President, Chief Financial January __, 1997
- ------------------------ Officer (Principal Financial
Robert B. Jones Officer and Principal Accounting
Officer)
/s/ GLENN W. NOVOTNY Director January __, 1997
- ------------------------
Glenn W. Novotny
/s/ DANIEL P. HOGAN, JR. Director January __, 1997
- ------------------------
Daniel P. Hogan, Jr.
/s/ LEE D. HINES, JR. Director January __, 1997
- ------------------------
Lee D. Hines, Jr.
</TABLE>
8
