-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RFfihq60ZR7ml8RayJ5GeYlr7TnUd9MJgmPQtlY46eRHwH815cyjYCT1120jSa3P Zw3dyi0SGxQ8URGlQw1i0w== 0001012734-98-000001.txt : 19980129 0001012734-98-000001.hdr.sgml : 19980129 ACCESSION NUMBER: 0001012734-98-000001 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19980128 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRAVIS BOATS & MOTORS INC CENTRAL INDEX KEY: 0001012734 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-AUTO & HOME SUPPLY STORES [5531] IRS NUMBER: 742024798 STATE OF INCORPORATION: TX FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: SEC FILE NUMBER: 000-20757 FILM NUMBER: 98515393 BUSINESS ADDRESS: STREET 1: 5000 PLAZA ON THE LAKE STREET 2: SUITE 250 CITY: AUSTIN STATE: TX ZIP: 78746 BUSINESS PHONE: 5123478787 MAIL ADDRESS: STREET 1: 5000 PLAZA ON THE LAKE STREET 2: SUITE 250 CITY: AUSTIN STATE: TX ZIP: 78746 10-K/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A Amendment No. 2 [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Fee Required) For the Fiscal Year Ended September 30, 1997 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 0-20757 TRAVIS BOATS & MOTORS, INC. (Exact name of registrant as specified in its charter) TEXAS 74-2024798 State or other jurisdiction of (I.R.S. Employer incorporation of organization) Identification Number) 5000 Plaza on the Lake, Suite 250, Austin, Texas 78747 (Address of principal executive offices) Registrant's telephone number, including area code: (512) 347-8787 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12 (g) of the Act: COMMON STOCK, $.01 PAR VALUE (Title of class) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 and 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [__] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K 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. [__] The aggregate market value of the voting stock (which consists solely of shares of Common Stock) held by non-affiliates of the Registrant as of January 26, 1998, (based upon the last reported price of $23.00 per share) was approximately $56,187,229 on such date. The number of shares of the issuer's Common Stock, par value $.01 per share, outstanding as of January 26, 1998 was 4,228,471 of which 2,442,923 shares were held by non-affiliates. PART III Item 10. Directors and Executive Officers The Company's Bylaws provide that the affairs of the Company shall be conducted by a Board of Directors composed of seven members and empower the Board to increase or decrease the number of directors by resolution adopted by a majority of the Board. The Board in its discretion and in accordance with such authority has fixed its size at seven members. The Board of Directors is divided into three classes, designated as Class A, Class B and Class C. The members of each class of directors serve for staggered three-year terms. Messrs. Bohls and Simpson are currently Class A directors and will stand for reelection at the 2000 annual stockholders meeting. Messrs. Spradling, Gurasich and McClendon are currently Class B directors and are to stand for election at the 1998 annual stockholders meeting. Messrs. Walton and Siddons are currently Class C directors and will stand for election at the 1999 annual stockholders' meeting. The Class B directors elected at the 1998 annual stockholders' meeting will hold office until the 2001 annual stockholders' meeting or until such director's successor shall be elected or appointed. The affirmative vote of a plurality of holders of the outstanding shares of Common Stock represented at a meeting at which a quorum is present is required to elect each director nominee The following table sets forth certain information with respect to each director and each executive officer of the Company: Name Age Position Mark T. Walton(1)(2) 46 Chairman of the Board and President Ronnie L. Spradling(1) 54 Executive Vice President--New Store Development and Director Michael B. Perrine 34 Chief Financial Officer, Treasurer and Secretary E. D. Bohls(1)(2) 79 Vice Chairman of the Board Joseph E. Simpson(1)(2)(3) 64 Director Robert C. Siddons(1)(2)(4) 55 Director Steven W. Gurasich,Jr.(3)(4) 49 Director Zach McClendon, Jr.(3)(4) 60 Director (1) Member of the Nominations Committee. (2) Member of the Executive Committee (3) Member of the Audit Committee. (4) Member of the Compensation Committee. Mark T. Walton has served as President and as a director of the Company since 1980 and as Chairman of the Board since 1995. From 1979 to 1980, Mr. Walton served as the General Manager of the Company's Austin store. Mr. Walton has over 27 years of retail boating experience. Ronnie L. Spradling has served as Executive Vice President of the Company since 1989 and as the Executive Vice President of New Store Development since 1994. Mr. Spradling became a director in 1995. Mr. Spradling previously served as the General Manager of Falcon Marine, Inc. (a subsidiary of the Company), located in Midland, Texas from 1982 to 1988. Mr. Spradling has over 30 years of experience in boat retailing operations. Michael B. Perrine has served as Chief Financial Officer since 1991 and as Treasurer and Secretary of the Company since 1992. From 1986 to 1991, he served as a loan officer in the Commercial Banking Division of NationsBank, N.A. Mr. Perrine is responsible for developing and implementing the Company's corporate structure. E. D. Bohls has served as Vice Chairman of the Board of the Company since 1995 and previously served as Chairman of the Board of the Company from 1979 to 1995. He served as Chairman of the Board of Capitol Commerce Reporter, Inc., a public records research company, from 1986 through 1997. In addition, he has served as Vice President and as a director of Americana Enterprises, a private real estate development joint venture, since 1975. Mr. Bohls is currently an independent investor. Joseph E. Simpson has served as a director of the Company since 1979. He served as President and as a director of Capitol Commerce Reporter, Inc., a records research company, from 1986 through 1997. Mr. Simpson is currently an independent investor. Robert C. Siddons has served as a director of the Company since 1979. He has served as President of Frank Siddons Insurance Agency, a family-owned insurance agency, since 1987. In addition, he has served as President of the Texas Builders Insurance Company, a commercial lines insurance company, since 1987. Steven W. Gurasich, Jr. has served as director of the Company since July, 1996. For over the past 20 years, Mr. Gurasich has served in various capacities, including most recently as Chairman of the Board of GSD&M Advertising, Austin, Texas, an advertising firm, handling such accounts as Southwest Airlines, Wal-Mart, MasterCard, Coors Light and Pearle Vision. Zach McClendon, Jr. has served as a director of the Company since July, 1996. Mr. McClendon is the co-founder of the predecessor to SeaArc Marine, Inc., a manufacturer of various types of boats and marine products, and now serves as the Chairman of the Board of its parent company, SeaArk Boats, Inc. In addition, Mr. McClendon serves as the Chairman of the Board of Union Bank and Trust Company, a subsidiary of First Union Financial Corporation, and as Chairman of the Board of Drew Cottonseed Oil Mill, Inc., a manufacturer of polystyrene products. Compliance with Section 16(a) of the Exchange Act During the fiscal year ended September 30, 1997, based on a review of Forms 3 and 4 furnished to the Company during its most recent fiscal year and Forms 5 furnished to the Company with respect to its most recent fiscal year, all reporting persons of the Company were in compliance with Section 16(a) of the Exchange Act, except as noted below. Mr. Robert C. Siddons failed to file a Form 4 reflecting the sale of 20,000 shares of Common Stock in June 1997. Mr. Zach McClendon, Jr. failed to file a Form 4 reflecting the purchase of 7,600 shares of Common Stock in June 1997. Item 11. Executive Compensation Compensation of Executive Officers The following table sets forth certain information with respect to the compensation awarded to, earned by or paid for services rendered to the Company in all capacities during the fiscal years ended September 30, 1997, September 30, 1996 and September 30, 1995, with respect the Company's President, Mr. Walton, the Executive Vice President, Mr. Spradling, and the Chief Financial Officer, Mr. Perrine (collectively, the ("Named Executive Officers"). No other executive officers of the Company received annual compensation (including salary and bonuses earned) which exceeded $100,000 during the fiscal year ended September 30, 1997.
Long-TermCompensation OTHER SECURITIES Principal Fiscal ANNUAL UNDERLYING Name Position Year Salary Bonus COMPENSATION OPTIONS - ------------------- ------------ ------- ---------- -------- ----------- ----------- Mark T. Walton President 1997 $175,000 $55,500 $1,100(2) -- 1996 129,250 45,034 4,177(2) 1995(1) 108,000 45,000 -- 20,267 Ronnie L. Executive 1997 $150,000 $58,300 $1,100(2) Spradling Vice 1996 96,900 45,034 1,578(2) -- President 1995(1) 69,000 45,000 -- 46,933 Michael B. Chief 1997 $90,000 $35,000 $625(2) 5,000 Perrine Financial 1996 71,085 27,500 625(2) -- Officer 1995 57,600 17,500 -- 66,667
(1) Fiscal year 1995 was a nine-month period; dollar amounts shown have been annualized. (2) Principally 401(k) plan matching contribution. Compensation of Directors Directors who are not officers and employees of or consultants to the Company receive annual compensation of $10,000, plus $2,000 annually for each committee on which such director serves, excluding the Nominations Committee, for which compensation is not received, and $3,000 per year in the case of the Executive Committee. Directors' expenses for attending meetings are reimbursed by the Company. Options Granted in Last Fiscal Year The following table sets forth information concerning stock options granted by the Company to the Named Executive Officers during the fiscal year ended September 30, 1997.
Individual Grants Potential Realizable Number of % of Total Value at Assumed Securities Options Annual Rates of Stock Underlying Granted to Exercise Price Appreciation for Options Employees in Price Expiration Option Term (1) Name Granted Fiscal Year ($/Share) Date 5% 10% - ---------------- ---------- ------------ --------- ----------- ---------- ----------- Mark T. Walton 0 N/A N/A N/A N/A N/A Ronnie L. 0 N/A N/A N/A N/A N/A Spradling Michael B. 5,000 14.9% $10.50 3/11/2007 $33,010 $83,671 Perrine
_________________ (1) These amounts are calculated based on certain assumed rates of annual compound stock price appreciation from the date the option was granted to the end of the option term. Actual gains, if any, on stock option exercises and Common Stock holdings are dependent on the future performance of the Common Stock and overall stock market conditions. There can be no assurance that the amounts reflected in this table will be achieved. These calculations assume a fair market value of $10.50 per share of Common Stock at the date of grant. Stock Option Exercises and Holdings The following table shows information regarding stock option exercises and unexercised options held as of the end of the fiscal year ended September 30, 1997 by the Named Executive Officers.
At September 30, 1997 Number of Unexercised Options Value of In-the-Money Options Options Name* Exercised* Exercisable Unexercisable Exercisable* Unexercisable* - -------------- ---------- ----------- ------------- ------------ -------------- Mark T. Walton 0 8,106 12,161 $122,603 $183,935 Ronnie L. 0 18,774 28,159 $283,957 $425,905 Spradling Michael B. 0 26,667 45,000 $436,348 $688,671 Perrine(1)
* Based on closing price of $20.375 September 30, 1997. Employment Agreements The Company is the beneficiary of employment agreements with TBC Management, Ltd. (an affiliated partnership of the Company) and each of Mark T. Walton, Ronnie L. Spradling and Michael B. Perrine, providing, among other things, for three-year terms commencing in July 1996 and annual base salaries of $175,000 for Mr. Walton, $150,000 for Mr. Spradling and $90,000 for Mr. Perrine, respectively. In addition, Messrs. Walton, Spradling and Perrine have agreed to contractual confidentiality and noncompete provisions in their respective employment agreements, which will extend beyond termination of their employment for any reason. In the event any of these employees are terminated without ''cause,'' as such term is defined in the employee agreements, such employees will be entitled to payment of approximately three times their annual salary. The employment agreements also provide that, if the consolidated income of Travis Boats before income tax expenses and non-recurring audit adjustments (the ''Pre-tax Income'') reflects growth in excess of 20% over the previous fiscal year, Messrs. Walton and Spradling will each receive a bonus of 2% of the Pre-tax Income and Mr. Perrine will receive a bonus of 1% of the Pre-tax Income. If the Pre-tax Income does not reflect growth of 20%, the bonus for each individual will be determined by the Board of Directors. Compensation Committee Interlocks and Insider Participation The Compensation Committee consists of Robert C. Siddons, Steven W. Gurusich, Jr. and Zach McClendon, Jr. Mr. Robert C. Siddons served as the President of the Company from 1979 through 1985. Mr. Zach McClendon, Jr. is an indirect majority owner and the Chairman of the Board of SeaArk Boats, Inc. In fiscal year 1997, the Company purchased $2.4 million of boats from SeaArk, Inc. The Company anticipates that this relationship will continue at the same level of activity in fiscal year 1998. No member of the current Compensation Committee serves as an executive officer of the Company, or as a director of any entity, an executive officer of which serves on the Compensation Committee or as a director of the Company. Item 12. Security Ownership of Certain Beneficial Owners and Management The following table sets forth certain information regarding the beneficial ownership of the Common Stock as of December 31, 1997 by (i) each director of the Company, (ii) each Named Executive Officer, (iii) each person known or believed by the Company to own beneficially 5% or more of the Common Stock and (iv) all directors and executive officers as a group. Unless otherwise indicated, each person has sole voting and dispositive power with respect to such shares. Percent Number of Beneficially Name of Beneficial Owner Shares(1)(2) Owned - ------------------------- ------------ ---------------- E. D. Bohls(3) 506,027 12.0% Robert C. Siddons(4) 360,130 8.5% Mark T. Walton(5) 375,574 8.9% Joseph E. Simpson 249,000 5.9% Ronnie L. Spradling(6) 251,417 5.9 Steven W. Gurasich, Jr.(7) 13,333 * Zach McClendon, Jr.(8) 20,933 * Michael B. Perrine(9) 9,134 * Wasatch Advisors, Inc.(10) 464,025 11.0% Fleet Financial Group, Inc.(11) 217,600 5.1% Downtown Associates, L.P.(12) 233,225 5.5% Downtown Associates III, L.P. Downtown Associates, L.L.C. The Sweet Water Trust The Phaedrus Foundation Ronald Juvonen Philip Timon Alfred Loomis, III All executive officers and 1,785,548 42.2% directors as a group (eight persons)(13) _______________________ * Less than 1% (1) Except as otherwise indicated, the persons named in the table have sole voting and investment power with respect to the shares of Common Stock shown as beneficially owned by them. Beneficial ownership as reported in the above table has been determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), based on information furnished by the persons listed, and represents the number of shares of Common Stock for which a person, directly or indirectly, through any contract, management, understanding, relationship or otherwise, has or shares voting power, including the power to vote or direct the voting of such shares, or investment power, including the power to dispose or to direct the disposition of such shares, and includes shares which may be acquired upon the exercise of options within 60 days following January 28, 1998. The percentages are based upon 4,228,471 shares outstanding. Except as otherwise noted below, the address of each holder of 5% or more of the Common Stock is 5000 Plaza on the Lake, Suite 250, Austin, Texas, 78746. (2) Does not include options granted to Mark T. Walton, Ronnie L. Spradling and Michael B. Perrine to purchase 12,161, 28,159 and 40,000 shares of Common Stock, respectively, which are not exercisable within 60 days after January 28, 1998. (3) Includes 130,912 shares owned by Mr. Bohls' son, James Bohls, with respect to which Mr. E. D. Bohls controls the voting rights. Mr. E. D. Bohls disclaims beneficial ownership of such shares. Also includes 30,816 shares held by trusts for the benefit of James Bohls' children of which James Bohls serves as trustee, but all voting rights have been retained by Mr. E. D. Bohls. (4) Includes 25,264 shares held by family trusts over which Mr. Siddons exercises sole voting and investment control. (5) Includes 8,106 shares subject to options exercisable within 60 days of January 28, 1998, 301,000 shares held in a family limited partnership, over which Mr. Walton has sole voting control, and 3,268 shares owned and held in trust for Mr. Walton's children, for which the voting rights reside with Mr. Walton. (6) Includes 18,774 shares subject to options exercisable within 60 days of January 28, 1998. (7) Includes 13,333 shares subject to options exercisable within 60 days of January 28, 1998. (8) Includes 13,333 shares subject to options exercisable within 60 days of January 28, 1998. (9) Includes 1,666 shares subject to options exercisable within 60 days of January 28, 1998. (10) The address of Wasatch Advisors, Inc. is 68 South Main, Salt Lake City, Utah 84101. (11) The address of Fleet Financial Group, Inc. is One Federal Street, Boston, Massachusetts 02110. (12) Voting power and dispositive power is shared among each of the shareholders listed. The address of Downtown Associates, L.P., Dowtown Associates III, L.P., Downtown Associates, L.L.C., Ronald Juvonen, Philip Timon and Alfred Loomis, III is 920 East Baltimore Pike, Kennett Square, Pennsylvania 19348. The address of the Sweet Water Trust and the Phaedrus Foundation is 36 West 44th Street, New York, New York 10036. (13) See Notes (5), (6), (7), (8) and (9). Includes 55,212 shares subject to options exercisable within 60 days of January 28, 1998. Item 13. Certain Relationships and Related Transactions SeaArk Boats, Inc. In fiscal year 1997, the Company purchased $2.4 million of boats from SeaArk Boats, Inc. ("SeaArk"). SeaArk is wholly- owned by UniGrace, Inc., which in turn is wholly-owned by McClendon Resources. McClendon Resources is wholly-owned by Zach McClendon, a Director of the Company, and his children. Mr. McClendon serves as the Chairman of the Board of SeaArk, UniGrace, Inc. and McClendon Resources. The Company anticipates that this relationship will continue at the same level in year 1998. Reinsurance Arrangements. The Company, through June 28, 1996, sold extended service contracts to its customers. The obligations of the Company under these contracts were transferred to Ideal Insurance Company, Ltd. ("Ideal") pursuant to an agreement between the Company and Ideal dated as of January 1, 1994. Ideal reinsures these risks with Amerisure Property & Casualty, Ltd. ("Amerisure"), a company wholly owned by certain principal stockholders and directors of the Company, with Messrs. E. D. Bohls, Siddons, Walton and Simpson owning an aggregate of approximately 76%. These contracts are administered by First Extended Service Corporation ("FESC") and are reinsured under a stop-loss policy issued to Amerisure by FFG Insurance Co. ("FFG"), an affiliate of FESC. In conjunction with these arrangements, the Company paid an agreed amount for each extended service contract which is insured and, in the event of claims under any extended service contracts, Amerisure reimburses the repair facility for the amount of covered claims. Amerisure and/or FFG are financially responsible for any repairs required pursuant to the extended service contract. Amerisure is a separate legal entity from the Company. The Company terminated its relationship with Amerisure effective June 28, 1996 with respect to future extended service contracts. The Company is currently using traditional insurance, utilizing an unrelated third party. To provide for the risks associated with the extended service contracts sold by the Company prior to June 28, 1996, Amerisure intends to retain cash reserves in an amount it believes will reasonably be adequate to cover any of Amerisure's obligations. Moreover, Amerisure has obtained the above described stop-loss policy from FFG. For the three fiscal years ended September 30, 1996, September 30, 1995, and December 31, 1994, Amerisure received an aggregate of approximately $850,000, all of which it has reserved against losses with respect to extended service contracts sold to the Company's customers. As noted above, no further amounts were paid to Amerisure after June 28, 1996. All of Amerisure's business resulted from the Company's sale of extended service contracts. Amerisure's underwriting losses and aggregate reinsurance costs will not be determinable until the end of each of the five-year extended service contracts sold prior to June 28, 1996. The Company is not affiliated with Ideal, FESC or FFG. Employment Arrangements. Executive management, store management and corporate administrative employees are employed by TBC Management, Ltd., a Texas limited partnership (the "Partnership"). The Partnership, in turn, has entered into a Management Agreement with the Company and its subsidiaries and invoices each company monthly for management services rendered. The general partner and 1.0% owner of the Partnership is the Company. The sole limited partner and 99.0% owner of the Partnership is TBC Management, Inc. (the "Delaware Company"), a Delaware company wholly owned by Travis Boats. The operations of the Partnership are accounted for on a consolidated basis with those of the Company. The Delaware Company's income results from distributions of the Partnership and is accordingly taxed under Delaware law. These arrangements allow the Company more easily to allocate costs among the various store locations and to reduce Texas franchise taxes. Certain Borrowings. E. D. Bohls, Jesse Cox, Robert D. Siddons, Joseph E. Simpson, Ronnie L. Spradling and Mark T. Walton, all of whom are stockholders, officers or directors of the Company, have each executed a personal guaranty of certain indebtedness of the Company. It is anticipated that such guaranties will be released upon refinancing of such indebtedness. SIGNATURES Pursuant to the requirements of the 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. TRAVIS BOATS & MOTORS, INC. _____/S/____ By: Mark T. Walton Chairman of the Board and President Date: January 27, 1998 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 and on the dates indicated. Signature Title Date /S/ MARK T. WALTON Mark T. Walton Chairman of the Board, President and January 27, 1998 Director (Principal Executive Officer ) /S/ RONNIE L. SPRADLING Ronnie L. Spradling Executive Vice President-New Store January 27, 1998 Development and Director /S/ MICHAEL B. PERRINE Michael B. Perrine Chief Financial Officer, Secretary January 27, 1998 and Treasurer (Principal Financial and Accounting Officer ) /S/ E. D. BOHLS E. D. Bohls Vice Chairman of the Board January 27, 1998 and Director /S/ ROBERT C. SIDDONS Robert C. Siddons Director January 27, 1998 /S/ JOSEPH E. SIMPSON Joseph E. Simpson Director January 27, 1998 -----END PRIVACY-ENHANCED MESSAGE-----