1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
--- ACT OF 1934
For the quarterly period ended June 30, 1995
-------------
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
--- EXCHANGE ACT OF 1934
For the transition period from to
---------- ----------
Commission File Number 1-9548
------
The Timberland Company
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 02-0312554
--------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
200 Domain Drive, Stratham, New Hampshire 03885
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (603) 772-9500
----------------------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
On August 4, 1995 8,266,795 shares of the registrant's Class A Common Stock were
outstanding and 2,735,381 shares of the registrant's Class B Common Stock were
outstanding.
2
THE TIMBERLAND COMPANY
FORM 10-Q
TABLE OF CONTENTS
Page(s)
-------
Independent Accountants' Review Report 1
Part I Financial Information (unaudited)
Condensed Consolidated Balance Sheets - 2-3
June 30, 1995 and December 31, 1994
Condensed Consolidated Statements of Operations - 4
For the three and six months ended June 30, 1995
and July 1, 1994
Condensed Consolidated Statements of Cash Flows - 5
For the six months ended June 30, 1995 and
July 1, 1994
Notes to Condensed Consolidated Financial Statements 6-8
Management's Discussion and Analysis of Financial
Condition and Results of Operations 9-12
Part II Other Information 13-15
3
Form 10-Q
Page 1
INDEPENDENT ACCOUNTANTS' REVIEW REPORT
To the Stockholders and Board of Directors of
The Timberland Company:
We have reviewed the accompanying condensed consolidated balance sheet of The
Timberland Company and subsidiaries as of June 30, 1995, and the related
condensed consolidated statements of operations and cash flows for the
three-month and six-month periods ended June 30, 1995 and July 1, 1994. These
financial statements are the responsibility of the
Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and of making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to such condensed consolidated financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of The Timberland Company and
subsidiaries as of December 31, 1994, and the related consolidated statements of
income, changes in stockholders' equity, and cash flows for the year then ended
(not presented herein); and, in our report dated February 9, 1995, we expressed
an unqualified opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed consolidated
balance sheet as of December 31, 1994, is fairly stated, in all material
respects, in relation to the consolidated balance sheet from which it was
derived.
Deloitte & Touche LLP
Boston, Massachusetts
July 19, 1995
4
Form 10-Q
Page 2
Part I Financial Information
THE TIMBERLAND COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
(Dollars in Thousands)
(Unaudited)
June 30, December 31,
1995 1994
--------- ------------
Current assets
Cash and equivalents $ 2,846 $ 6,381
Accounts receivable, net 111,975 128,435
Inventories 264,948 218,219
Prepaid expenses 11,153 13,504
Deferred and refundable income taxes 19,040 7,112
--------- ---------
Total current assets 409,962 373,651
--------- ---------
Property, plant and equipment, at cost 90,513 110,650
Less accumulated depreciation and amortization (37,200) (42,417)
--------- ---------
Net property, plant and equipment 53,313 68,233
--------- ---------
Assets held for sale 5,441 -
Excess of cost over fair value of net assets
acquired, net 25,114 25,956
Other assets, net 7,846 5,424
--------- ---------
$ 501,676 $ 473,264
========= =========
See accompanying notes to condensed consolidated financial statements.
5
Form 10-Q
Page 3
THE TIMBERLAND COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
(Dollars in Thousands)
(Unaudited)
June 30, December 31,
1995 1994
-------- ------------
Current liabilities
Notes payable $ 65,000 $ 22,513
Current maturities of long-term obligations 7,806 8,048
Accounts payable 35,572 37,035
Accrued expenses
Payroll and related 7,502 6,038
Interest and other 29,784 24,459
Income taxes payable 1,034 9,029
-------- --------
Total current liabilities 146,698 107,122
-------- --------
Long-term obligations, less current maturities 206,826 206,767
-------- --------
Deferred income taxes 10,535 10,285
-------- --------
Deferred income 4,609 -
-------- --------
Stockholders' equity
Preferred stock, $.01 par value; 2,000,000 shares authorized;
none issued - -
Class A Common Stock, $.01 par value (1 vote per share);
30,000,000 shares authorized; 8,265,893 shares issued
at June 30, 1995 and 8,221,615 shares at
December 31, 1994 83 82
Class B Common Stock, $.01 par value (10 votes per share);
15,000,000 shares authorized; 2,735,381 shares issued
at June 30, 1995 and 2,737,121 shares at December 31,
1994 27 27
Additional paid-in capital 58,423 57,756
Retained earnings 72,354 91,816
Cumulative translation adjustment 2,241 (471)
Less treasury stock at cost, 18,369 shares at June 30,
1995 and December 31, 1994 (120) (120)
-------- --------
133,008 149,090
-------- --------
$501,676 $473,264
======== ========
See accompanying notes to condensed consolidated financial statements.
6
Form 10-Q
Page 4
THE TIMBERLAND COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
(Unaudited)
For the For the
Three Months Ended Six Months Ended
------------------ ----------------
June 30, July 1, June 30, July 1,
1995 1994 1995 1994
-------- -------- -------- --------
Revenues $125,143 $127,254 $266,726 $235,572
Cost of goods sold 89,064 86,795 185,675 162,397
-------- -------- -------- --------
Gross profit 36,079 40,459 81,051 73,175
-------- -------- -------- --------
Operating expenses
Selling 34,312 27,038 67,803 49,890
General and administrative 12,053 9,667 23,724 19,624
Amortization of goodwill 421 250 842 444
Restructuring charge 16,000 - 16,000 -
-------- -------- -------- --------
Total operating expenses 62,786 36,955 108,369 69,958
-------- -------- -------- --------
Operating income (loss) (26,707) 3,504 (27,318) 3,217
-------- -------- -------- --------
Other expense (income)
Interest expense 5,725 3,440 10,841 5,325
Other, net 441 (171) (6,769) 269
-------- -------- -------- --------
Total other expense 6,166 3,269 4,072 5,594
-------- -------- -------- --------
Income (loss) before income taxes (32,873) 235 (31,390) (2,377)
-------- -------- -------- --------
Provision (benefit) for income taxes (12,492) 90 (11,928) (903)
-------- -------- -------- --------
Net income (loss) $(20,381) $ 145 $(19,462) $ (1,474)
======== ======== ======== ========
Earnings (loss) per share $ (1.83) $ .01 $ (1.75) $ (.13)
======== ======== ======== ========
Weighted average shares outstanding and
share equivalents 11,120 11,201 11,130 11,216
======== ======== ======== ========
See accompany notes to condensed consolidated financial statements.
.
7
Form 10-Q
Page 5
THE TIMBERLAND COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
For the
Six Months Ended
----------------
June 30, July 1,
1995 1994
--------- ---------
Cash flows from operating activities:
Net loss $ (19,462) $ (1,474)
Adjustments to reconcile net loss
to net cash used in operating activities:
Deferred income taxes 250 684
Depreciation and amortization 8,629 7,017
Gain on distributorship transaction (7,358) -
Restructuring charge 16,000 -
Gain on sale of equipment (127) -
Increase (decrease) in cash from changes in working
capital items, net of effects of distributorship
transaction:
Accounts receivable 12,700 (25,977)
Inventories (52,034) (76,471)
Prepaid expenses 2,494 (3,077)
Accounts payable (1,554) 4,459
Accrued expenses (3,071) 9,835
Income taxes (19,923) (1,944)
--------- ---------
Net cash used in operating activities (63,456) (86,948)
--------- ---------
Cash flows from investing activities:
Proceeds from distributorship transaction 24,000 -
Proceeds from sale of equipment 1,756 -
Additions to property, plant and equipment, net (7,903) (9,170)
Acquisition of Italian distributor - (14,086)
Other, net (1,267) 1,061
--------- ---------
Net cash provided by (used) in investing activities 16,586 (22,195)
--------- ---------
Cash flows from financing activities:
Net borrowings under short-term credit facilities 42,470 43,676
Proceeds from long-term obligations 525 65,000
Payments on long-term and capital lease obligations (692) (332)
Issuance of common stock 668 477
--------- ---------
Net cash provided by financing activities 42,971 108,821
--------- ---------
Effect of exchange rate changes on cash 364 105
--------- ---------
Net decrease in cash and equivalents (3,535) (217)
Cash and equivalents at beginning of period 6,381 3,281
--------- ---------
Cash and equivalents at end of period $ 2,846 $ 3,064
========= =========
Supplemental disclosures of cash flow information:
Interest paid $ 10,766 $ 4,158
Income taxes paid 7,744 391
See accompanying notes to condensed consolidated financial statements.
8
Form 10-Q
Page 6
THE TIMBERLAND COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain the adjustments necessary to
present fairly the Company's financial position, results of operations
and changes in cash flows for the interim periods presented. Such
adjustments consisted of normal recurring items. The unaudited
condensed consolidated financial statements should be read in
conjunction with the consolidated financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for the
year ended December 31, 1994.
Certain prior period amounts have been reclassified for consistent
presentation with the current period presentation.
2. The results of operations for the six months ended June 30, 1995 are
not necessarily indicative of the results to be expected for the full
year. Historically, the Company's revenues have been more heavily
weighted to the second half of the year.
3. Recognition of Revenue
Revenue consists of sales to customers, license fees and royalties.
Sales are recognized upon shipment of product to customers while
license fees and royalties are recognized when earned. Such license
fees and royalties are included in "Revenues" and aggregated $4.6
million and $4.8 million for the three and six month periods ended June
30, 1995, respectively. These license fees and royalties were $.3
million and $.5 million for the three and six month periods ended July
1, 1994.
4. Inventories consist of the following (in thousands):
June 30, 1995 December 31, 1994
------------- -----------------
Raw materials $ 18,801 $ 19,806
Work-in-process 5,709 13,137
Finished goods 240,438 185,276
-------- --------
$264,948 $218,219
======== ========
5. Indebtedness
On July 21, 1995, the Company amended the revolving credit agreement
to provide for up to $50 million in letters of credit under the
overall $125 million committed facility.
6. Other Income
On January 26, 1995, the Company appointed Inchcape plc ("Inchcape") as
the exclusive distributor of Timberland(R) products throughout most of
the Asia/Pacific region. The agreement included Inchcape's acquisition
of the Company's Australian and New Zealand subsidiaries and future
consideration provided to Inchcape for the total sum of $24 million.
The transaction resulted in a non-recurring pre-tax gain of
approximately $7.4 million. The noncurrent portion of the future
consideration of $6.0 million on the transaction date is reported in
the condensed consolidated balance sheet as deferred income and is
being amortized to income as products are shipped to the Company's
former subsidiaries. In 1994, revenues of the Company's Australian and
New Zealand subsidiaries combined accounted for less than 2% of total
consolidated revenues.
9
Form 10-Q
Page 7
THE TIMBERLAND COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
7. Legal Proceedings
The Company is involved in litigation and various legal matters,
including U.S. Customs claims, which have arisen in the ordinary course
of business. Management believes that the ultimate resolution of any
existing matter will not have a material effect on the Company's
consolidated financial statements.
The Company and two of its officers and directors have been named as
defendants in two actions filed in the United States District Court for
the District of New Hampshire, one filed by Jerrold Schaffer on
December 12, 1994, and the other filed by Gershon Kreuser on January 4,
1995. On April 24, 1995, the District Court granted the plaintiffs'
motion, assented to by the defendants, to consolidate the two suits.
The plaintiffs filed a single consolidated amended complaint with the
District Court on June 23, 1995. The amended complaint alleges that the
defendants violated the federal securities laws by making material
misstatements and omissions in certain of the Company's public filings
and statements in 1994. Specifically, the amended complaint alleges
that such statements and omissions had the effect of artificially
inflating the market price for the Company's Common Stock until the
disclosure by the Company on December 9, 1994, of its expectation
that results for the fourth quarter were not likely to meet analysts'
anticipated levels. Damages are unspecified. The amended complaint
seeks class action status for all purchasers of the Company's
Common Stock between May 12, 1994 and December 9, 1994.
While this action is in its preliminary stages, based on an initial
review, and after consultation with counsel, management believes the
allegations are without merit. Accordingly, management does not expect
the outcome of such litigation to have a material adverse effect on the
consolidated financial statements. The Company intends to defend this
proceeding vigorously.
8. Restructuring Charge
During the second quarter of 1995, the Company closed its manufacturing
facilities in Boone, North Carolina and Mountain City, Tennessee,
reduced its manufacturing operations in the Dominican Republic and
downsized its corporate office workforce due to a reorganized
management structure. These actions resulted in a one-time pre-tax
charge of $16.0 million. The Company has two remaining manufacturing
facilities: one in Puerto Rico and one in the Dominican Republic. All
other product is sourced by the Company from contract manufacturers.
10
Form 10-Q
Page 8
THE TIMBERLAND COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Of the total charge for restructuring, $10.4 million relates to
anticipated losses associated with the disposal of assets and is a
non-cash item; $2.6 million relates to payments for contractual lease
obligations and anticipated expenditures to close idle facilities; and
$3.0 million relates to anticipated payments for severance and employee
insurance liabilities.
Restructuring actions are substantially completed with the
exception of the sale of certain manufacturing equipment which may not
occur until 1996. The Company has funded the restructuring plan from
internal sources and available borrowing capacity. The Company
estimates the results of the restructuring plan will begin lowering
operating costs in the second half of 1995. Savings from the planned
action will be used to repay indebtedness and for both business-
building initiatives and profit improvement.
11
Form 10-Q
Page 9
THE TIMBERLAND COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Unaudited)
RESULTS OF OPERATIONS
The following table sets forth selected items in the Company's condensed
consolidated statements of operations as percentages of revenues for the
periods indicated.
For the For the
Three Months Ended Six Months Ended
-------------------- --------------------
June 30, July 1, June 30, July 1,
1995 1994 1995 1994
-------- ------- -------- -------
Revenues 100.0% 100.0% 100.0% 100.0%
Cost of goods sold 71.2 68.2 69.6 68.9
----- ----- ----- -----
Gross profit 28.8 31.8 30.4 31.1
----- ----- ----- -----
Operating expenses
Selling 27.4 21.2 25.4 21.2
General and administrative 9.6 7.6 8.9 8.3
Amortization of goodwill .3 .2 .3 .2
Restructuring charge 12.8 - 6.0 -
----- ----- ----- -----
Total operating expenses 50.2 29.0 40.6 29.7
----- ----- ----- -----
Operating income (loss) (21.3) 2.8 (10.2) 1.4
----- ----- ----- -----
Other expense (income)
Interest expense 4.6 2.7 4.1 2.3
Other, net .4 (.1) (2.5) .1
----- ----- ----- -----
Total other expense 4.9 2.6 1.5 2.4
----- ----- ----- -----
Income (loss) before income taxes (26.3) .2 (11.8) (1.0)
Provision (benefit) for income taxes (10.0) .1 (4.5) (.4)
----- ----- ----- -----
Net income (loss) (16.3)% .1% (7.3)% (.6)%
===== ===== ===== =====
Note: Percentages may not add due to rounding.
12
Form 10-Q
Page 10
Second Quarter 1995 Compared with Second Quarter 1994
-----------------------------------------------------
Revenues for the second quarter of 1995 were $125.1 million, a decrease of 1.7%
compared to the $127.3 million reported in the comparable prior year period.
The revenue decline primarily occurred in the Company's wholesale footwear
business. The generally soft retail environment also contributed to the
revenue decline as an oversupply of product affected at-once orders and can be
expected to have an unfavorable impact on second half 1995 revenue. In
addition, Timberland's more aggressive approach toward credit management and
toward establishing firmer controls over distribution and diversion of
Timberland(R) products had a negative impact on revenues. Revenues for the
second quarter of 1995 include $4.6 million of licensing fees and royalties, of
which $4.2 million are non-recurring, compared to $.3 million reported in the
comparable prior year period.
Footwear revenues decreased $11.1 million, or 10.3%, in the second quarter of
1995, compared to the same period in 1994. Apparel and accessories revenues
increased $9.0 million, or 45.9%, in the second quarter of 1995, compared to
the same period in 1994. Retail revenue represented 18.6% of total revenues in
the current quarter, compared to 7.6% in the second quarter of 1994. Domestic
first quality comparable retail store revenues were up 8% compared with second
quarter 1994. Domestic revenues declined $2.8 million, or 2.9%, compared to the
second quarter of 1994. International revenues for the second quarter of 1995
were up 2.2%, compared to the same period in the prior year, and comprised
24.4% of total second quarter revenue in 1995 versus 23.5% in the second
quarter of 1994.
Gross profit as a percentage of revenues for the second quarter of 1995 was
28.8%, compared to 31.8% for the second quarter of 1994. Gross margin was
depressed by a change in product sales mix; although first quality inventory
represented a substantial majority of total revenues, off-price sales
comprised a greater percentage of total revenues than in the same quarter last
year. In addition, period costs associated with concluding operations at
certain of the Company's manufacturing facilities further depressed gross
margins.
During the second quarter of 1995, the Company closed its manufacturing
facilities in Boone, North Carolina and Mountain City, Tennessee, reduced its
manufacturing operations in the Dominican Republic and downsized its corporate
office workforce due to a reorganized management structure. Approximately 1,800
positions were eliminated. These actions resulted in a one-time pre-tax charge
of $16.0 million. The Company has two remaining manufacturing facilities: one
in Puerto Rico and one in the Dominican Republic. All other product is sourced
by the Company from contract manufacturers.
Of the total charge for restructuring, $10.4 million relates to anticipated
losses associated with the disposal of assets and is a non-cash item; $2.6
million relates to payments for contractual lease obligations and anticipated
expenditures to close idle facilities; and $3.0 million relates to anticipated
payments for severance and employee insurance liabilities.
Restructuring actions are substantially completed with the exception of the
sale of certain manufacturing equipment which may not occur until 1996. The
Company has funded the costs of the restructuring plan from internal sources
and available borrowing capacity. The Company estimates the restructuring plan
will begin lowering operating costs in the second half of 1995 and to generate
increasing savings in subsequent years, growing to an annual savings of
approximately $7.0 million in 1996. Savings from the planned action will be
used to repay indebtedness and for both business-building initiatives and
profit improvement.
13
Form 10-Q
Page 11
Excluding the one-time pre-tax restructuring charge, operating expenses were
$46.8 million in the second quarter of 1995, compared to $37.0 million in the
second quarter of 1994. Operating expenses, exclusive of the restructuring
charge, as a percentage of revenue in the second quarter of 1995 were 37.4%,
compared to 29.0% in the second quarter of 1994. This increase was due in
part to higher operating costs associated with the Company's growing retail
organization and to a larger core infrastructure designed to support higher
revenue levels.
Interest expense for the second quarter of 1995 increased by $2.3 million to
$5.7 million over the comparable period in 1994, primarily as a result of
increased borrowings to support higher inventory levels and higher interest
rates.
Six Months ended June 30, 1995 Compared with Six Months ended July 1, 1994.
---------------------------------------------------------------------------
Revenues for the first six months of 1995 were $266.7 million, an increase of
13.2% over the $235.6 million for the comparable period in 1994. Revenues for
the first six months of 1995 include $4.8 million of licensing fees and
royalties, $4.2 million of which are non-recurring, received in connection with
licensing agreements compared with $.5 million for the comparable period in
1994. The increase in product revenues was attributable to an overall increase
in the number of footwear, apparel and accessory units sold. Revenues for the
first six months of 1995 were adversely impacted by the mild winter and
generally soft retail environment.
Gross profit as a percentage of revenues for the first six months of 1995 was
30.4%, compared to 31.1% for the comparable period in 1994.
Excluding the one-time pretax restructuring charge, operating expenses for the
first half of 1995 increased $22.4 million to $92.4 million from $70.0 million
for the comparable period in 1994. The increase is principally a result of the
Company's growing retail organization and the larger core infrastructure
designed to support higher revenue periods. As a percentage of revenues,
operating expenses, exclusive of the restructuring charge, increased to 34.6%
in 1995 from 29.7% in 1994.
Interest expense for the first six months of 1995 increased by $5.5 million over
the comparable period in 1994, primarily as a result of increased borrowings
to support higher inventory levels and higher interest rates.
For the first six months of 1995, other expense (income) includes a
non-recurring pre-tax gain of $7.4 million resulting from the Company's
appointment on January 26, 1995 of Inchcape plc as the exclusive distributor of
Timberland(R) products throughout most of the Asia/Pacific region. The agreement
included Inchcape's acquisition of the Company's Australian and New Zealand
subsidiaries and future consideration provided to Inchcape for a total sum of
$24 million.
LIQUIDITY AND CAPITAL RESOURCES
Cash used by operations during the first six months of 1995 was $63.5 million,
compared to $86.9 million in the same period in 1994. Net cash used by
operations was adversely affected by increased levels of inventories. Accounts
receivable declined $16.5 million from December 31, 1994, and $6.0 million
since July 1, 1994, primarily as the result of the decline in second quarter
1995 wholesale revenues compared to second quarter 1994. Wholesale days sales
outstanding increased to 93 days at June 30, 1995, compared to 88 days at July
1, 1994. Inventories increased $46.7 million since December 31, 1994.
Inventory turns were 1.5 times for the second quarter of 1995, compared to 2.2
times for the same period in 1994.
14
Form 10Q
Page 12
During the first six months of 1995, $16.6 million of cash was provided from
investing activities, due primarily to $24 million of cash proceeds received
from the agreement with Inchcape plc. These proceeds were partially offset by
capital expenditures for the first six months of 1995 of $7.9 million, compared
to $9.2 million for the same period in 1994. The increase in the level of total
borrowings since year end 1994 is due primarily to the higher inventory levels.
The Company uses unsecured revolving and committed lines of credit as the
primary sources of financing for its seasonal and other working capital
requirements. On July 21, 1995, the Company amended the revolving credit
agreement which extends through the end of February 1997, to provide for up to
$50 million in letters of credit under the overall $125 million committed
facility. The Company's debt to capital ratio was 67.8% at June 30, 1995
compared to 61.4% at December 31, 1994 and 62.1% at July 1, 1994.
Management believes that the Company's capital needs for 1995 will be met
through the credit facilities and cash flows from operations, without the need
for additional permanent financing.
15
Form 10-Q
Page 13
Part II Other Information
Item 4. Submission of Matters to a Vote of Security Holders.
(a) The Company held its Annual Meeting of Stockholders on May 18,
1995.
(b) At such Annual Meeting proxies were solicited pursuant to
Regulation 14A of the Securities Exchange Act of 1934 and all
nominees for director were elected as indicated by the following
Schedule of votes cast for each director. The holders of Class A
Common Stock elected the following directors:
Total Votes for Each Total Votes Withheld
Nominee Director from Each Director
------- -------- ------------------
John F. Brennan 7,221,984 105,861
Abraham Zaleznik 7,220,484 107,361
The holders of Class A Common Stock and the holders of Class B Common
Stock voting together as a single class elected the following
directors:
Total Votes for Each Total Votes Withheld
Nominee Director from Each Director
------- -------- ------------------
Robert M. Agate 34,575,994 105,661
Jeffrey B. Swartz 34,557,290 124,365
Sidney W. Swartz 34,571,138 110,517
There were no abstentions or broker non-votes with respect to the
election of the director nominees.
The stockholders approved a proposal to increase the number of
shares reserved for issuance under the Company's 1987 Stock Option
Plan from 1,600,000 to 2,100,000 and to set the maximum number of
shares for which options may be granted thereunder in any year to
any participant at 150,000. There were 32,638,898 votes cast in
favor of this proposal, 351,273 votes cast against this
proposal, 49,085 abstentions and 1,642,399 broker non-votes.
The stockholders approved a proposal to increase the number of
shares reserved for issuance under the Company's 1991 Employee
Stock Purchase Plan from 100,000 to 200,000. There were 32,814,131
votes cast in favor of this proposal, 176,109 votes cast against
this proposal, 49,016 abstentions and 1,642,399 broker non-votes.
Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits
Exhibit Description
------- -----------
Material Contracts
10.10(b) Amendment No. 1 dated as of April 1, 1995 to Amended and Restated Note Agreements
(c) Amendment No. 2 dated as of June 28, 1995 to Amended and Restated Note Agreements
10.12(b) Amendment No. 1 dated as of April 15, 1995 to Note Agreements
(c) Amendment No. 2 dated as of June 28, 1995 to Note Agreements
16
Form 10-Q
Page 14
10.13 Amendment No. 3 dated as of July 21, 1995 to the Amended and Restated Credit Agreement
dated as of March 14, 1995 among The Timberland Company, certain banks listed therein and
Morgan Guaranty Trust Company of New York, as Agent, which also incorporates Amendment No. 1
dated as of April 19, 1995 and Amendment No. 2 dated as of June 28, 1995.
10.14(b) Amendment No. 1 dated as of April 15, 1995 to Note Agreements
(c) Amendment No. 2 dated as of June 28, 1995 to Note Agreements
27 Financial Data Schedule
(b) Reports on Form 8-K -- There were no reports on Form 8-K filed
during the period covered by this report.
17
Form 10-Q
Page 15
Signatures
Pursuant to the requirements 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.
The Timberland Company
---------------------------
(Registrant)
Date: August 14, 1995 Keith D. Monda
--------------- ---------------------------
Keith D. Monda
Senior Vice President -
Finance and Administration
and Chief Financial Officer
Date: August 14, 1995 Dennis W. Hagele
--------------- ---------------------------
Dennis W. Hagele
Vice President Finance
and Corporate Controller
(Chief Accounting Officer)