þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended January 3, 2015 | |
or | |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 38-1185150 | |
State or other jurisdiction of incorporation or organization | (I.R.S. Employer Identification No.) | |
9341 Courtland Drive N.E., Rockford, Michigan | 49351 | |
(Address of principal executive offices) | (Zip Code) | |
Registrant’s telephone number, including area code (616) 866-5500 | ||
Securities registered pursuant to Section 12(b) of the Securities Exchange Act: | ||
Title of each class | Name of each exchange on which registered | |
Common Stock, $1 Par Value | New York Stock Exchange |
PART I | ||
Item 1. | ||
Item 1A. | ||
Item 1B. | ||
Item 2. | ||
Item 3. | ||
Item 4. | ||
Supplemental Item. | ||
PART II | ||
Item 5. | ||
Item 6. | ||
Item 7. | ||
Item 7A. | ||
Item 8. | ||
Item 9. | ||
Item 9A. | ||
Item 9B. | ||
PART III | ||
Item 10. | ||
Item 11. | ||
Item 12. | ||
Item 13. | ||
Item 14. | ||
PART IV | ||
Item 15. | ||
SIGNATURES | ||
• | changes in national, regional or global economic and market conditions; |
• | the impact of financial and credit markets on the Company, its suppliers and customers; |
• | changes in interest rates, tax laws, duties, tariffs, quotas or applicable assessments in countries of import and export; |
• | the impact of regulation, regulatory and legal proceedings and legal compliance risks; |
• | currency fluctuations; |
• | currency restrictions; |
• | changes in future pension funding requirements and pension expenses; |
• | the risk of impairment to goodwill and other acquired intangibles; |
• | the risks of doing business in developing countries, and politically or economically volatile areas; |
• | the ability to secure and protect owned intellectual property or use licensed intellectual property; |
• | changes in consumer preferences, spending patterns, buying patterns, price sensitivity or demand for the Company’s products; |
• | risks related to the significant investment in, and performance of, the Company’s consumer-direct business; |
• | the impact of seasonality and unpredictable weather conditions; |
• | changes in relationships with, including the loss of, significant customers; |
• | the cancellation of orders for future delivery; |
• | the failure of the U.S. Department of Defense to exercise future purchase options or award new contracts, or the cancellation or modification of existing contracts by the Department of Defense or other military purchasers; |
• | the cost, availability and management of raw materials, inventories, services and labor for owned and contract manufacturers; |
• | problems affecting the Company’s distribution system, including service interruptions at shipping and receiving ports; |
• | the potential breach of the Company’s databases, or those of its vendors, which contain certain personal information or payment card data; |
• | the inability for any reason to effectively compete in global footwear, apparel and consumer-direct markets; |
• | strategic actions, including new initiatives and ventures, acquisitions and dispositions, and the Company’s success in integrating acquired businesses, and implementing new initiatives and ventures; and |
• | the success of the Company’s consumer-direct realignment initiatives. |
Item 1. | Business |
• | Lifestyle Group, consisting of Sperry Top-Sider® footwear and apparel, Stride Rite® footwear and apparel, Hush Puppies® footwear and apparel, Keds® footwear and apparel, and Soft Style® footwear; |
• | Performance Group, consisting of Merrell® footwear and apparel, Saucony® footwear and apparel, Chaco® footwear, and Cushe® footwear; and |
• | Heritage Group, consisting of Wolverine® footwear and apparel, Cat® footwear, Bates® uniform footwear, Sebago® footwear and apparel, Harley-Davidson® footwear, and HyTest® safety footwear. |
1. | Lifestyle Group |
2. | Performance Group |
3. | Heritage Group |
• | The Company uses a dedicated sales force and customer service team, third party sales representatives and point-of-purchase materials to support domestic sales. |
• | The Company maintains core in-stock inventories to service department stores, national chains, specialty retailers, catalog retailers, independent retailers, uniform outlets and its own consumer-direct business. |
• | The Company uses volume direct programs to ship products directly to the retail customer without going through a Company distribution center and provide products at competitive prices to service major retail, catalog, mass merchant and government customers. |
• | The Company uses a network of independent Shoemobile® distribution outlets to distribute certain of the Company’s work and occupational footwear brands at industrial facilities. |
• | The Company solicits all branches of the U.S. military and submits bids for contracts to supply specific footwear products. |
Item 1A. | Risk Factors |
Item 1B. | Unresolved Staff Comments |
Item 2. | Properties |
Item 3. | Legal Proceedings |
Item 4. | Mine Safety Disclosures |
Name | Age | Positions held with the Company | ||
James A. Gabel | 52 | President, Performance Group | ||
Ted S. Gedra | 59 | President, Heritage Group | ||
Brendan M. Gibbons | 39 | Vice President, General Counsel and Secretary | ||
Donald T. Grimes | 52 | Senior Vice President, Chief Financial Officer and Treasurer | ||
Melissa A. Howell | 48 | Senior Vice President, Global Human Resources | ||
Michael Jeppesen | 55 | President, Global Operations Group | ||
Blake W. Krueger | 61 | Chairman of the Board, Chief Executive Officer and President | ||
Andrew Simister | 49 | President, Lifestyle Group | ||
James D. Zwiers | 47 | Senior Vice President and President, International Group |
Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
Fiscal 2014 | Fiscal 2013 | ||||||||||||||
Stock price | High | Low | High | Low | |||||||||||
First quarter | $ | 34.10 | $ | 25.13 | $ | 23.19 | $ | 19.20 | |||||||
Second quarter | 30.00 | 25.06 | 27.13 | 21.42 | |||||||||||
Third quarter | 27.47 | 24.00 | 30.18 | 24.72 | |||||||||||
Fourth quarter | 30.75 | 24.21 | 33.91 | 27.54 |
Fiscal Year | |||||||
Cash dividends declared per share | 2014 | 2013 | |||||
First quarter | $ | 0.06 | $ | 0.06 | |||
Second quarter | 0.06 | 0.06 | |||||
Third quarter | 0.06 | 0.06 | |||||
Fourth quarter | 0.06 | 0.06 |
Period | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Dollar Amount that May Yet Be Purchased Under the Plans or Programs | |||||||||
Period 1 (September 7, 2014 to October 4, 2014) | |||||||||||||
Common Stock Repurchase Program (1) | — | $ | — | — | $ | 200,000,000 | |||||||
Employee Transactions (2) | 2,621 | 26.77 | |||||||||||
Period 2 (October 5, 2014 to November 1, 2014) | |||||||||||||
Common Stock Repurchase Program (1) | — | $ | — | — | $ | 200,000,000 | |||||||
Employee Transactions (2) | 11,844 | 25.65 | |||||||||||
Period 3 (November 2, 2014 to November 29, 2014) | |||||||||||||
Common Stock Repurchase Program (1) | — | $ | — | — | $ | 200,000,000 | |||||||
Employee Transactions (2) | 40,036 | 27.41 | |||||||||||
Period 4 (November 30, 2014 to January 3, 2015) | |||||||||||||
Common Stock Repurchase Program (1) | — | $ | — | — | $ | 200,000,000 | |||||||
Employee Transactions (2) | 7,083 | 29.55 | |||||||||||
Total for Fourth Quarter ended January 3, 2015 | |||||||||||||
Common Stock Repurchase Program (1) | — | $ | — | — | $ | 200,000,000 | |||||||
Employee Transactions (2) | 61,584 | 27.29 |
(1) | The Company’s Board of Directors approved a common stock repurchase program on February 12, 2014. This program authorizes the repurchase of up to $200 million of common stock over a four-year period, although the annual amount of any stock repurchases are restricted under the terms of the Company's Credit Agreement. |
(2) | Employee transactions include: (1) shares delivered or attested to in satisfaction of the exercise price and/or tax withholding obligations by holders of employee stock options who exercised options, and (2) restricted shares withheld to offset statutory minimum tax withholding that occurs upon vesting of restricted shares. The Company’s employee stock compensation plans provide that the shares delivered or attested to, or withheld, shall be valued at the closing price of the Company’s common stock on the date the relevant transaction occurs. |
Item 6. | Selected Financial Data |
Fiscal Year | |||||||||||||||||||
(In millions, except per share data) | 2014 | 2013 | 2012 (4) | 2011 | 2010 | ||||||||||||||
Summary of Operations | |||||||||||||||||||
Revenue | $ | 2,761.1 | $ | 2,691.1 | $ | 1,640.8 | $ | 1,409.1 | $ | 1,248.5 | |||||||||
Net earnings attributable to Wolverine World Wide, Inc. | 133.1 | 100.4 | 80.7 | 123.3 | 104.5 | ||||||||||||||
Per share of common stock: | |||||||||||||||||||
Basic net earnings (2)(3) | $ | 1.33 | $ | 1.01 | $ | 0.84 | $ | 1.27 | $ | 1.08 | |||||||||
Diluted net earnings (2)(3) | 1.30 | 0.99 | 0.81 | 1.24 | 1.06 | ||||||||||||||
Cash dividends declared (3) | 0.24 | 0.24 | 0.24 | 0.24 | 0.22 | ||||||||||||||
Financial Position at Year-End | |||||||||||||||||||
Total assets | $ | 2,504.5 | $ | 2,622.2 | $ | 2,614.4 | $ | 851.7 | $ | 786.6 | |||||||||
Debt | 900.8 | 1,150.0 | 1,250.0 | 11.5 | 1.0 |
(1) | This summary should be read in conjunction with the consolidated financial statements and the related notes, which are included in Item 8 of this Annual Report on Form 10-K. |
(2) | Basic earnings per share are based on the weighted average number of shares of common stock outstanding during the year after adjustment for nonvested restricted common stock. Diluted earnings per share assume the exercise of dilutive stock options and the vesting of all outstanding restricted stock. |
(3) | All per share data has been presented to reflect the two-for-one stock split in the form of a stock dividend paid on November 1, 2013 to stockholders of record on October 1, 2013. |
(4) | The operating results for PLG are included in the Company’s consolidated results of operations beginning October 9, 2012. |
Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | Revenue for fiscal 2014 was $2,761.1 million, an increase of 2.6% compared to fiscal 2013. Foreign exchange had a minimal impact on full year revenue growth. High single-digit growth from the Heritage Group and mid single-digit growth from the Performance Group was partially offset by expected low single-digit revenue decline from the Lifestyle Group. |
• | Gross margin for fiscal 2014 was 39.3%, a decrease of 30 basis points from fiscal 2013. The gross margin decline was driven primarily by a negative mix shift in international markets, the impact of retail store close-out activities and incremental expense related to the last-in, first-out ("LIFO") method. |
• | Operating expenses as a percentage of revenue decreased to 31.0% for fiscal 2014 compared to 32.4% for fiscal 2013. In addition to the higher revenues in fiscal 2014, the reduction in operating expenses as a percent of revenues was driven by lower pension expense, lower acquisition-related costs and lower incentive compensation expenses, which were partially offset by higher restructuring costs, higher selling expenses and higher brand building expenses. |
• | The effective tax rate in fiscal 2014 was 26.2% compared to 20.9% in fiscal 2013. The higher effective tax rate in fiscal 2014 reflects a greater proportion of income generated in higher tax jurisdictions, primarily the U.S., compared to 2013. In addition, the 2013 tax rate reflects higher acquisition-related integration costs that are deductible primarily in high statutory tax rate jurisdictions. |
• | Inventory decreased 3.3% versus the prior year. |
• | Accounts receivable decreased 21.5% due primarily to a three-year agreement with a financial institution executed during the fourth quarter of fiscal 2014, to sell selected trade accounts receivable on a recurring, nonrecourse basis, which generated incremental operating cash flows of approximately $65.5 million during fiscal 2014. |
• | Cash provided by operating activities was $314.6 million during fiscal 2014, which allowed the Company to make payments on its long-term debt of $249.8 million. |
• | The Company declared cash dividends of $0.24 per share, on a post-stock split basis, in both fiscal 2014 and fiscal 2013. |
Fiscal Year | Percent Change vs. Prior Year | ||||||||||||||||
(In millions, except per share data) | 2014 | 2013 | 2012 | 2014 | 2013 | ||||||||||||
Revenue | $ | 2,761.1 | $ | 2,691.1 | $ | 1,640.8 | 2.6 | % | 64.0 | % | |||||||
Cost of goods sold | 1,673.8 | 1,619.0 | 1,008.1 | 3.4 | 60.6 | ||||||||||||
Acquisition-related transaction and integration costs | — | — | 4.5 | — | (100.0 | ) | |||||||||||
Restructuring costs | 1.0 | 7.6 | — | (86.8 | ) | — | |||||||||||
Gross profit | 1,086.3 | 1,064.5 | 628.2 | 2.0 | 69.5 | ||||||||||||
Selling, general and administrative expenses | 815.2 | 830.0 | 482.0 | (1.8 | ) | 72.2 | |||||||||||
Acquisition-related transaction and integration costs | 15.2 | 41.5 | 32.5 | (63.4 | ) | 27.7 | |||||||||||
Restructuring costs | 26.0 | 0.7 | — | 3,614.3 | — | ||||||||||||
Operating profit | 229.9 | 192.3 | 113.7 | 19.6 | 69.1 | ||||||||||||
Interest expense, net | 45.4 | 52.0 | 14.0 | (12.7 | ) | 271.4 | |||||||||||
Acquisition-related interest expense | — | — | 5.2 | — | (100.0 | ) | |||||||||||
Debt extinguishment costs | 1.3 | 13.1 | — | (90.1 | ) | — | |||||||||||
Other expense (income), net | 1.7 | (0.5 | ) | 0.3 | 440.0 | (266.7 | ) | ||||||||||
Earnings before income taxes | 181.5 | 127.7 | 94.2 | 42.1 | 35.6 | ||||||||||||
Income tax expense | 47.6 | 26.7 | 13.4 | 78.3 | 99.3 | ||||||||||||
Net earnings | 133.9 | 101.0 | 80.8 | 32.6 | 25.0 | ||||||||||||
Less: net earnings attributable to noncontrolling interest | 0.8 | 0.6 | 0.1 | 33.3 | 500.0 | ||||||||||||
Net earnings attributable to Wolverine World Wide, Inc. | $ | 133.1 | $ | 100.4 | $ | 80.7 | 32.6 | % | 24.4 | % | |||||||
Diluted earnings per share | $ | 1.30 | $ | 0.99 | $ | 0.81 | 31.3 | % | 22.2 | % |
• | Lifestyle Group, consisting of Sperry Top-Sider® footwear and apparel, Stride Rite® footwear and apparel, Hush Puppies® footwear and apparel, Keds® footwear and apparel and Soft Style® footwear; |
• | Performance Group, consisting of Merrell® footwear and apparel, Saucony® footwear and apparel, Chaco® footwear, Patagonia® footwear and Cushe® footwear; and |
• | Heritage Group, consisting of Wolverine® footwear and apparel, Cat® footwear, Bates® uniform footwear, Sebago® footwear and apparel, Harley-Davidson® footwear and HyTest® safety footwear. |
Fiscal Year | Percent Change | Fiscal Year | Percent Change | ||||||||||||||||||||||||||
(In millions) | 2014 | 2013 | Change | 2013 | 2012 | Change | |||||||||||||||||||||||
Revenue: | |||||||||||||||||||||||||||||
Lifestyle Group | $ | 1,059.3 | $ | 1,086.6 | $ | (27.3 | ) | (2.5 | )% | $ | 1,086.6 | $ | 309.6 | $ | 777.0 | 251.0 | % | ||||||||||||
Performance Group | 990.7 | 945.8 | 44.9 | 4.7 | 945.8 | 674.6 | 271.2 | 40.2 | |||||||||||||||||||||
Heritage Group | 607.0 | 567.4 | 39.6 | 7.0 | 567.4 | 563.9 | 3.5 | 0.6 | |||||||||||||||||||||
Other | 104.1 | 91.3 | 12.8 | 14.0 | 91.3 | 92.7 | (1.4 | ) | (1.5 | ) | |||||||||||||||||||
Total | $ | 2,761.1 | $ | 2,691.1 | $ | 70.0 | 2.6 | % | $ | 2,691.1 | $ | 1,640.8 | $ | 1,050.3 | 64.0 | % |
Fiscal Year | Percent Change | Fiscal Year | Percent Change | ||||||||||||||||||||||||||
(In millions) | 2014 | 2013 | Change | 2013 | 2012 | Change | |||||||||||||||||||||||
Operating profit (loss): | |||||||||||||||||||||||||||||
Lifestyle Group | $ | 130.2 | $ | 168.2 | $ | (38.0 | ) | (22.6 | )% | $ | 168.2 | $ | 44.6 | $ | 123.6 | 277.1 | % | ||||||||||||
Performance Group | 197.6 | 179.8 | 17.8 | 9.9 | 179.8 | 128.4 | 51.4 | 40.0 | |||||||||||||||||||||
Heritage Group | 95.4 | 85.7 | 9.7 | 11.3 | 85.7 | 83.5 | 2.2 | 2.6 | |||||||||||||||||||||
Other | 3.9 | 0.2 | 3.7 | 1,850.0 | 0.2 | (1.1 | ) | 1.3 | 118.2 | ||||||||||||||||||||
Corporate | (197.2 | ) | (241.6 | ) | 44.4 | 18.4 | (241.6 | ) | (141.7 | ) | (99.9 | ) | (70.5 | ) | |||||||||||||||
Total | $ | 229.9 | $ | 192.3 | $ | 37.6 | 19.6 | % | $ | 192.3 | $ | 113.7 | $ | 78.6 | 69.1 | % |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
Cash and cash equivalents | $ | 223.8 | $ | 214.2 | $ | 171.4 | |||||
Debt | 900.8 | 1,150.0 | 1,250.0 | ||||||||
Available revolving credit facility (1) | 196.4 | 196.5 | 198.1 | ||||||||
Cash provided by operating activities | 314.6 | 202.3 | 91.6 | ||||||||
Cash used in investing activities | (34.8 | ) | (44.7 | ) | (1,246.1 | ) | |||||
Cash (used in) provided by financing activities | (270.4 | ) | (112.8 | ) | 1,183.4 | ||||||
Additions to property, plant and equipment | 30.0 | 41.7 | 14.9 | ||||||||
Depreciation and amortization | 53.3 | 56.2 | 27.7 |
(1) | Amounts are net of both borrowings and outstanding standby letters of credit in accordance with the terms of the current revolving credit facility. |
(In millions) | Total | Less than 1 year | 1-3 years | 3-5 years | More than 5 years | ||||||||||||||
Operating leases | $ | 323.1 | $ | 50.9 | $ | 84.1 | $ | 62.3 | $ | 125.8 | |||||||||
Capital lease | 0.8 | 0.1 | 0.2 | 0.2 | 0.3 | ||||||||||||||
Debt obligations (1) | 1,065.1 | 80.4 | 177.6 | 414.0 | 393.1 | ||||||||||||||
Purchase obligations (2) | 449.1 | 449.1 | — | — | — | ||||||||||||||
Deferred compensation | 2.8 | 0.5 | 0.9 | 0.8 | 0.6 | ||||||||||||||
Supplemental Executive Retirement Plan | 40.4 | 3.7 | 8.0 | 8.0 | 20.7 | ||||||||||||||
Dividends declared | 6.2 | 6.2 | — | — | — | ||||||||||||||
Minimum royalties | 1.8 | 1.8 | — | — | — | ||||||||||||||
Minimum advertising | 26.4 | 8.7 | 5.5 | 5.9 | 6.3 | ||||||||||||||
Total (3) | $ | 1,915.7 | $ | 601.4 | $ | 276.3 | $ | 491.2 | $ | 546.8 |
(1) | Includes principal and interest payments on the Company’s debt, net of the impact of the interest rate swap. Estimated future interest payments on outstanding debt obligations are based on interest rates as of January 3, 2015. Actual cash outflows may differ significantly due to changes in underlying interest rates. See Note 10 to the consolidated financial statements for additional information on the Company's interest rate swap. |
(2) | Purchase obligations related primarily to inventory and capital expenditure commitments. |
(3) | The Company adopted FASB ASC Topic 740, Income Taxes, on December 31, 2006. The total amount of unrecognized tax benefits on the consolidated balance sheet at January 3, 2015 is $8.6 million. At this time, the Company is unable to make a reasonably reliable estimate of the timing of payments in individual years beyond 12 months due to uncertainties in the timing of tax audit outcomes. As a result, this amount is not included in the table above. |
Item 7A. | Quantitative and Qualitative Disclosures About Market Risk |
Item 8. | Financial Statements and Supplementary Data |
Consolidated Statements of Operations | |
Consolidated Statements of Comprehensive Income | |
Consolidated Balance Sheets | |
Consolidated Statements of Cash Flows | |
Consolidated Statements of Stockholders' Equity | |
Note 1. Summary of Significant Accounting Policies | |
Note 2. New Accounting Standards | |
Note 3. Earnings Per Share | |
Note 4. Goodwill and Other Intangibles | |
Note 5. Accounts Receivable | |
Note 6. Inventories | |
Note 7. Debt | |
Note 8. Accumulated Other Comprehensive Income (Loss) | |
Note 9. Property, Plant and Equipment | |
Note 10. Financial Instruments and Risk Management | |
Note 11. Stock-Based Compensation | |
Note 12. Retirement Plans | |
Note 13. Income Taxes | |
Note 14. Litigation and Contingencies | |
Note 15. Business Segments | |
Note 16. Restructuring Activities | |
Note 17. Business Acquisitions | |
Note 18. Subsidiary Guarantors of the Public Bonds | |
Note 19. Quarterly Results of Operations (Unaudited) | |
Reports of Independent Registered Public Accounting Firm |
Fiscal Year | |||||||||||
(In millions, except per share data) | 2014 | 2013 | 2012 | ||||||||
Revenue | $ | 2,761.1 | $ | 2,691.1 | $ | 1,640.8 | |||||
Cost of goods sold | 1,673.8 | 1,619.0 | 1,008.1 | ||||||||
Acquisition-related transaction and integration costs | — | — | 4.5 | ||||||||
Restructuring costs | 1.0 | 7.6 | — | ||||||||
Gross profit | 1,086.3 | 1,064.5 | 628.2 | ||||||||
Selling, general and administrative expenses | 815.2 | 830.0 | 482.0 | ||||||||
Acquisition-related transaction and integration costs | 15.2 | 41.5 | 32.5 | ||||||||
Restructuring costs | 26.0 | 0.7 | — | ||||||||
Operating profit | 229.9 | 192.3 | 113.7 | ||||||||
Other expenses: | |||||||||||
Interest expense, net | 45.4 | 52.0 | 14.0 | ||||||||
Acquisition-related interest expense | — | — | 5.2 | ||||||||
Debt extinguishment costs | 1.3 | 13.1 | — | ||||||||
Other expense (income), net | 1.7 | (0.5 | ) | 0.3 | |||||||
Total other expenses | 48.4 | 64.6 | 19.5 | ||||||||
Earnings before income taxes | 181.5 | 127.7 | 94.2 | ||||||||
Income taxes | 47.6 | 26.7 | 13.4 | ||||||||
Net earnings | 133.9 | 101.0 | 80.8 | ||||||||
Less: net earnings attributable to noncontrolling interest | 0.8 | 0.6 | 0.1 | ||||||||
Net earnings attributable to Wolverine World Wide, Inc. | $ | 133.1 | $ | 100.4 | $ | 80.7 | |||||
Net earnings per share (see Note 3): | |||||||||||
Basic | $ | 1.33 | $ | 1.01 | $ | 0.84 | |||||
Diluted | $ | 1.30 | $ | 0.99 | $ | 0.81 |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
Net earnings | $ | 133.9 | $ | 101.0 | $ | 80.8 | |||||
Other comprehensive income (loss), net of tax: | |||||||||||
Foreign currency translation adjustments | (18.5 | ) | (5.4 | ) | 5.7 | ||||||
Effective portion of changes related to foreign exchange contracts: | |||||||||||
Net gain (loss) arising during the period, net of taxes of $4.1, $0.2 and $1.0 | 9.1 | (0.4 | ) | (2.1 | ) | ||||||
Reclassification adjustments into cost of goods sold, net of taxes of $(0.2), $(0.6) and $1.3 | 0.3 | 1.3 | (2.9 | ) | |||||||
Unrealized gain (loss) on interest rate swap, net of taxes of $0.1, $(0.8) and $0.5 | (0.2 | ) | 1.6 | (1.0 | ) | ||||||
Pension adjustments: | |||||||||||
Net actuarial gain (loss) arising during the period, net of taxes of $19.6, $(33.1) and $16.0 | (36.3 | ) | 61.4 | (29.8 | ) | ||||||
Amortization of prior actuarial losses, net of taxes of $(2.6), $(10.7) and $(7.3) | 4.8 | 19.7 | 13.5 | ||||||||
Amortization of prior service cost | 0.1 | 0.1 | 0.1 | ||||||||
Settlement gain included in net income, net of taxes of $0.3 | (0.7 | ) | — | — | |||||||
Other comprehensive (loss) income | (41.4 | ) | 78.3 | (16.5 | ) | ||||||
Comprehensive income | 92.5 | 179.3 | 64.3 | ||||||||
Less: comprehensive (loss) income attributable to noncontrolling interest | (0.3 | ) | 0.5 | — | |||||||
Comprehensive income attributable to Wolverine World Wide, Inc. | $ | 92.8 | $ | 178.8 | $ | 64.3 |
(In millions, except share data) | January 3, 2015 | December 28, 2013 | |||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 223.8 | $ | 214.2 | |||
Accounts receivable, less allowances: | |||||||
January 3, 2015 – $41.0 | |||||||
December 28, 2013 – $37.8 | 312.7 | 398.1 | |||||
Inventories: | |||||||
Finished products | 398.1 | 406.0 | |||||
Raw materials and work-in-process | 15.9 | 22.2 | |||||
Total inventories | 414.0 | 428.2 | |||||
Deferred income taxes | 28.1 | 29.1 | |||||
Prepaid expenses and other current assets | 63.6 | 48.4 | |||||
Total current assets | 1,042.2 | 1,118.0 | |||||
Property, plant and equipment: | |||||||
Gross cost | 415.3 | 416.1 | |||||
Accumulated depreciation | (278.5 | ) | (264.2 | ) | |||
Property, plant and equipment, net | 136.8 | 151.9 | |||||
Other assets: | |||||||
Goodwill | 438.8 | 445.3 | |||||
Indefinite-lived intangibles | 690.5 | 690.5 | |||||
Amortizable intangibles, net | 112.1 | 126.7 | |||||
Deferred income taxes | 2.8 | 3.4 | |||||
Deferred financing costs, net | 16.5 | 22.0 | |||||
Other | 64.8 | 64.4 | |||||
Total other assets | 1,325.5 | 1,352.3 | |||||
Total assets | $ | 2,504.5 | $ | 2,622.2 |
(In millions, except share data) | January 3, 2015 | December 28, 2013 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 149.4 | $ | 135.2 | |||
Accrued salaries and wages | 36.1 | 41.5 | |||||
Other accrued liabilities | 108.5 | 99.3 | |||||
Current maturities of long-term debt | 46.7 | 53.3 | |||||
Total current liabilities | 340.7 | 329.3 | |||||
Long-term debt, less current maturities | 854.1 | 1,096.7 | |||||
Accrued pension liabilities | 128.1 | 74.2 | |||||
Deferred income taxes | 217.0 | 253.9 | |||||
Other liabilities | 26.6 | 26.7 | |||||
Stockholders’ equity | |||||||
Wolverine World Wide, Inc. stockholders’ equity: | |||||||
Common stock – par value $1, authorized 320,000,000 shares; shares issued (including shares in treasury): | |||||||
January 3, 2015 – 102,253,150 shares | |||||||
December 28, 2013 – 100,817,972 shares | 102.3 | 100.8 | |||||
Additional paid-in capital | 40.1 | 5.0 | |||||
Retained earnings | 852.2 | 743.1 | |||||
Accumulated other comprehensive loss | (49.5 | ) | (9.2 | ) | |||
Cost of shares in treasury: | |||||||
January 3, 2015 – 416,812 shares | |||||||
December 28, 2013 – 72,514 shares | (11.6 | ) | (2.1 | ) | |||
Total Wolverine World Wide, Inc. stockholders’ equity | 933.5 | 837.6 | |||||
Noncontrolling interest | 4.5 | 3.8 | |||||
Total stockholders’ equity | 938.0 | 841.4 | |||||
Total liabilities and stockholders’ equity | $ | 2,504.5 | $ | 2,622.2 |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
OPERATING ACTIVITIES | |||||||||||
Net earnings | $ | 133.9 | $ | 101.0 | $ | 80.8 | |||||
Adjustments necessary to reconcile net earnings to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 53.3 | 56.2 | 27.7 | ||||||||
Deferred income taxes | (19.1 | ) | (27.8 | ) | (4.2 | ) | |||||
Stock-based compensation expense | 25.1 | 28.2 | 15.0 | ||||||||
Excess tax benefits from stock-based compensation | (5.6 | ) | (3.4 | ) | (9.9 | ) | |||||
Pension contribution | (3.9 | ) | (2.4 | ) | (26.7 | ) | |||||
Pension and SERP expense | 11.9 | 37.3 | 27.9 | ||||||||
Debt extinguishment costs | 1.3 | 13.1 | — | ||||||||
Restructuring costs | 27.0 | 8.3 | — | ||||||||
Cash payments related to restructuring costs | (7.7 | ) | (1.4 | ) | — | ||||||
Other | 11.5 | (4.3 | ) | 4.8 | |||||||
Changes in operating assets and liabilities: | |||||||||||
Accounts receivable | 76.5 | (41.3 | ) | 15.1 | |||||||
Inventories | 2.9 | 35.1 | (29.4 | ) | |||||||
Other operating assets | (17.8 | ) | 12.8 | (17.1 | ) | ||||||
Accounts payable | 16.2 | (26.5 | ) | 5.9 | |||||||
Other operating liabilities | 9.1 | 17.4 | 1.7 | ||||||||
Net cash provided by operating activities | 314.6 | 202.3 | 91.6 | ||||||||
INVESTING ACTIVITIES | |||||||||||
Business acquisition, net of cash acquired | — | — | (1,225.9 | ) | |||||||
Additions to property, plant and equipment | (30.0 | ) | (41.7 | ) | (14.9 | ) | |||||
Proceeds from sales of property, plant and equipment | — | 2.8 | — | ||||||||
Investments in joint ventures | (1.1 | ) | (2.5 | ) | (2.9 | ) | |||||
Other | (3.7 | ) | (3.3 | ) | (2.4 | ) | |||||
Net cash used in investing activities | (34.8 | ) | (44.7 | ) | (1,246.1 | ) | |||||
FINANCING ACTIVITIES | |||||||||||
Net repayments under revolving credit agreement | — | — | (11.0 | ) | |||||||
Borrowings of long-term debt | — | 775.0 | 1,275.0 | ||||||||
Payments of long-term debt | (249.8 | ) | (875.0 | ) | (25.5 | ) | |||||
Payments of debt issuance costs | — | (2.3 | ) | (40.1 | ) | ||||||
Cash dividends paid | (24.0 | ) | (23.7 | ) | (23.6 | ) | |||||
Purchase of common stock for treasury | — | — | (2.4 | ) | |||||||
Purchases of shares under employee stock plans | (10.5 | ) | (0.8 | ) | (11.7 | ) | |||||
Proceeds from the exercise of stock options | 7.3 | 8.6 | 11.6 | ||||||||
Excess tax benefits from stock-based compensation | 5.6 | 3.4 | 9.9 | ||||||||
Contributions from noncontrolling interest | 1.0 | 2.0 | 1.2 | ||||||||
Net cash (used in) provided by financing activities | (270.4 | ) | (112.8 | ) | 1,183.4 | ||||||
Effect of foreign exchange rate changes | 0.2 | (2.0 | ) | 2.5 | |||||||
Increase in cash and cash equivalents | 9.6 | 42.8 | 31.4 | ||||||||
Cash and cash equivalents at beginning of the year | 214.2 | 171.4 | 140.0 | ||||||||
Cash and cash equivalents at end of the year | $ | 223.8 | $ | 214.2 | $ | 171.4 | |||||
OTHER CASH FLOW INFORMATION | |||||||||||
Interest paid | $ | 42.2 | $ | 48.8 | $ | 10.0 | |||||
Net income taxes paid | $ | 70.2 | $ | 33.5 | $ | 16.3 |
Wolverine World Wide, Inc. Stockholders' Equity | |||||||||||||||||||||||||||
(In millions, except share and per share data) | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Non-controlling Interest | Total | ||||||||||||||||||||
Balance as of December 31, 2011 | $ | 96.3 | $ | — | $ | 553.4 | $ | (71.0 | ) | $ | — | $ | — | $ | 578.7 | ||||||||||||
Net earnings | 80.7 | 0.1 | 80.8 | ||||||||||||||||||||||||
Other comprehensive loss | (16.5 | ) | — | (16.5 | ) | ||||||||||||||||||||||
Shares issued under stock incentive plans, net of forfeitures (2,992,428 shares) | 1.5 | 1.5 | |||||||||||||||||||||||||
Stock-based compensation expense | 15.0 | 15.0 | |||||||||||||||||||||||||
Amounts associated with shares issued under stock incentive plans: | |||||||||||||||||||||||||||
Proceeds over par value | 9.5 | 9.5 | |||||||||||||||||||||||||
Income tax benefits | 11.0 | 11.0 | |||||||||||||||||||||||||
Issuance of performance shares (394,608 shares) | (0.2 | ) | (0.2 | ) | |||||||||||||||||||||||
Issuance of treasury shares (20,766 shares) | — | 0.5 | 0.5 | ||||||||||||||||||||||||
Shares acquired for treasury (354,411 shares) | (14.1 | ) | (14.1 | ) | |||||||||||||||||||||||
Cash dividends declared ($0.24 per share) | (23.7 | ) | (23.7 | ) | |||||||||||||||||||||||
Capital contribution from noncontrolling interest | 1.2 | 1.2 | |||||||||||||||||||||||||
Impact of stock split in the form of a stock dividend | 0.9 | (35.3 | ) | 23.0 | 11.4 | — | |||||||||||||||||||||
Balance as of December 29, 2012 | $ | 98.7 | $ | — | $ | 633.4 | $ | (87.5 | ) | $ | (2.2 | ) | $ | 1.3 | $ | 643.7 | |||||||||||
Net earnings | 100.4 | 0.6 | 101.0 | ||||||||||||||||||||||||
Other comprehensive income (loss) | 78.3 | (0.1 | ) | 78.2 | |||||||||||||||||||||||
Shares issued under stock incentive plans, net of forfeitures (2,068,751 shares) | 1.1 | 1.1 | |||||||||||||||||||||||||
Stock-based compensation expense | 28.2 | 28.2 | |||||||||||||||||||||||||
Amounts associated with shares issued under stock incentive plans: | |||||||||||||||||||||||||||
Proceeds over par value | 7.5 | 7.5 | |||||||||||||||||||||||||
Income tax benefits | 3.9 | 3.9 | |||||||||||||||||||||||||
Issuance of performance shares (785,458 shares) | (0.4 | ) | (0.4 | ) | |||||||||||||||||||||||
Issuance of treasury shares (26,590 shares) | — | 0.6 | 0.6 | ||||||||||||||||||||||||
Shares acquired for treasury (17,085 shares) | (0.8 | ) | (0.8 | ) | |||||||||||||||||||||||
Cash dividends declared ($0.24 per share) | (23.6 | ) | (23.6 | ) | |||||||||||||||||||||||
Capital contribution from noncontrolling interest | 2.0 | 2.0 | |||||||||||||||||||||||||
Impact of stock split in the form of stock dividend | 1.0 | (34.2 | ) | 32.9 | 0.3 | — | |||||||||||||||||||||
Balance as of December 28, 2013 | $ | 100.8 | $ | 5.0 | $ | 743.1 | $ | (9.2 | ) | $ | (2.1 | ) | $ | 3.8 | $ | 841.4 |
Wolverine World Wide, Inc. Stockholders' Equity | |||||||||||||||||||||||||||
(In millions, except share and per share data) | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Non-controlling Interest | Total | ||||||||||||||||||||
Balance as of December 28, 2013 | $ | 100.8 | $ | 5.0 | $ | 743.1 | $ | (9.2 | ) | $ | (2.1 | ) | $ | 3.8 | $ | 841.4 | |||||||||||
Net earnings | 133.1 | 0.8 | 133.9 | ||||||||||||||||||||||||
Other comprehensive loss | (40.3 | ) | (1.1 | ) | (41.4 | ) | |||||||||||||||||||||
Shares issued under stock incentive plans, net of forfeitures (795,523 shares) | 0.8 | (0.8 | ) | — | |||||||||||||||||||||||
Shares issued for stock options exercised, net (639,655 shares) | 0.7 | 6.6 | 7.3 | ||||||||||||||||||||||||
Stock-based compensation expense | 25.1 | 25.1 | |||||||||||||||||||||||||
Income tax benefits from stock incentive plans | 4.2 | 4.2 | |||||||||||||||||||||||||
Cash dividends declared ($0.24 per share) | (24.0 | ) | (24.0 | ) | |||||||||||||||||||||||
Issuance of treasury shares (35,484 shares) | — | 1.0 | 1.0 | ||||||||||||||||||||||||
Purchases of shares under employee stock plans (379,782 shares) | (10.5 | ) | (10.5 | ) | |||||||||||||||||||||||
Capital contribution from noncontrolling interest | 1.0 | 1.0 | |||||||||||||||||||||||||
Balance as of January 3, 2015 | $ | 102.3 | $ | 40.1 | $ | 852.2 | $ | (49.5 | ) | $ | (11.6 | ) | $ | 4.5 | $ | 938.0 |
1. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
2. | NEW ACCOUNTING STANDARDS |
3. | EARNINGS PER SHARE |
Fiscal Year | |||||||||||
(In millions, except share and per share data) | 2014 | 2013 | 2012 | ||||||||
Numerator: | |||||||||||
Net earnings attributable to Wolverine World Wide, Inc. | $ | 133.1 | $ | 100.4 | $ | 80.7 | |||||
Adjustment for earnings allocated to nonvested restricted common stock | (2.9 | ) | (2.3 | ) | (1.7 | ) | |||||
Net earnings used to calculate basic earnings per share | 130.2 | 98.1 | 79.0 | ||||||||
Adjustment for earnings reallocated to nonvested restricted common stock | 0.1 | 0.1 | 0.1 | ||||||||
Net earnings used to calculate diluted earnings per share | $ | 130.3 | $ | 98.2 | $ | 79.1 | |||||
Denominator: | |||||||||||
Weighted average shares outstanding | 101,433,114 | 100,253,617 | 97,632,336 | ||||||||
Adjustment for nonvested restricted common stock | (3,228,955 | ) | (3,308,162 | ) | (2,757,836 | ) | |||||
Shares used to calculate basic earnings per share | 98,204,159 | 96,945,455 | 94,874,500 | ||||||||
Effect of dilutive stock options | 1,860,661 | 1,993,343 | 2,154,152 | ||||||||
Shares used to calculate diluted earnings per share | 100,064,820 | 98,938,798 | 97,028,652 | ||||||||
Net earnings per share: | |||||||||||
Basic | $ | 1.33 | $ | 1.01 | $ | 0.84 | |||||
Diluted | $ | 1.30 | $ | 0.99 | $ | 0.81 |
4. | GOODWILL AND OTHER INTANGIBLE ASSETS |
(In millions) | Goodwill | Indefinite-lived intangibles | Total | ||||||||
Balance at December 29, 2012 | $ | 459.9 | $ | 679.8 | $ | 1,139.7 | |||||
Acquisition adjustments | (10.8 | ) | 10.0 | (0.8 | ) | ||||||
Foreign currency translation effects | (3.8 | ) | 0.7 | (3.1 | ) | ||||||
Balance at December 28, 2013 | $ | 445.3 | $ | 690.5 | $ | 1,135.8 | |||||
Foreign currency translation effects | (6.5 | ) | — | (6.5 | ) | ||||||
Balance at January 3, 2015 | $ | 438.8 | $ | 690.5 | $ | 1,129.3 |
January 3, 2015 | |||||||||||||
(In millions) | Average remaining life (years) | Gross carrying value | Accumulated amortization | Net | |||||||||
Customer relationships | 17 | $ | 100.5 | $ | 11.5 | $ | 89.0 | ||||||
Licensing arrangements | 2 | 28.8 | 15.2 | 13.6 | |||||||||
Developed product technology | 3 | 14.9 | 6.8 | 8.1 | |||||||||
Other | 2 | 10.4 | 9.0 | 1.4 | |||||||||
Total | $ | 154.6 | $ | 42.5 | $ | 112.1 |
December 28, 2013 | |||||||||||||
(In millions) | Average remaining life (years) | Gross carrying value | Accumulated amortization | Net | |||||||||
Customer relationships | 18 | $ | 100.5 | $ | 6.4 | $ | 94.1 | ||||||
Licensing arrangements | 3 | 28.8 | 8.3 | 20.5 | |||||||||
Developed product technology | 4 | 14.9 | 3.8 | 11.1 | |||||||||
Backlog | 0 | 5.2 | 5.2 | — | |||||||||
Other | 2 | 9.3 | 8.3 | 1.0 | |||||||||
Total | $ | 158.7 | $ | 32.0 | $ | 126.7 |
(In millions) | 2015 | 2016 | 2017 | 2018 | 2019 | ||||||||||||||
Amortization expense | $ | 15.5 | $ | 13.8 | $ | 8.7 | $ | 5.1 | $ | 5.0 |
5. | ACCOUNTS RECEIVABLE |
6. | INVENTORIES |
7. | DEBT |
(In millions) | January 3, 2015 | December 28, 2013 | |||||
Term Loan A, due October 10, 2018 | $ | 525.2 | $ | 775.0 | |||
Public Bonds, 6.125% interest, due October 15, 2020 | 375.0 | 375.0 | |||||
Capital lease obligation | 0.6 | — | |||||
Total debt | $ | 900.8 | $ | 1,150.0 |
(In millions) | 2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | |||||||||||||||||
Annual maturities of debt | $ | 46.7 | $ | 57.6 | $ | 57.6 | $ | 363.6 | $ | 0.1 | $ | 375.2 |
8. | ACCUMLATED OTHER COMPREHENSIVE INCOME (LOSS) |
(In millions) | Foreign currency translation adjustments | Foreign exchange contracts | Interest rate swap | Pension adjustments | Total | ||||||||||||||
Balance of accumulated other comprehensive income (loss) as of December 29, 2012 | $ | 5.9 | $ | (1.7 | ) | $ | (1.0 | ) | $ | (90.7 | ) | $ | (87.5 | ) | |||||
Other comprehensive income (loss) before reclassifications (1) | (5.4 | ) | (0.4 | ) | 1.6 | 61.4 | 57.2 | ||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | 1.9 | (2) | — | 30.5 | (3) | 32.4 | ||||||||||||
Income tax expense (benefit) | — | (0.6 | ) | — | (10.7 | ) | (11.3 | ) | |||||||||||
Net reclassifications | — | 1.3 | — | 19.8 | 21.1 | ||||||||||||||
Net current-period other comprehensive income (loss) (1) | (5.4 | ) | 0.9 | 1.6 | 81.2 | 78.3 | |||||||||||||
Balance of accumulated other comprehensive income (loss) as of December 28, 2013 | $ | 0.5 | $ | (0.8 | ) | $ | 0.6 | $ | (9.5 | ) | $ | (9.2 | ) | ||||||
Balance of accumulated other comprehensive income (loss) as of December 28, 2013 | $ | 0.5 | $ | (0.8 | ) | $ | 0.6 | $ | (9.5 | ) | $ | (9.2 | ) | ||||||
Other comprehensive income (loss) before reclassifications (1) | (17.4 | ) | 9.1 | (0.2 | ) | (36.3 | ) | (44.8 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | — | 0.5 | (2) | — | 6.5 | (3) | 7.0 | ||||||||||||
Income tax expense (benefit) | — | (0.2 | ) | — | (2.3 | ) | (2.5 | ) | |||||||||||
Net reclassifications | — | 0.3 | — | 4.2 | 4.5 | ||||||||||||||
Net current-period other comprehensive income (loss) (1) | (17.4 | ) | 9.4 | (0.2 | ) | (32.1 | ) | (40.3 | ) | ||||||||||
Balance of accumulated other comprehensive income (loss) as of January 3, 2015 | $ | (16.9 | ) | $ | 8.6 | $ | 0.4 | $ | (41.6 | ) | $ | (49.5 | ) |
(1) | Other comprehensive income is reported net of taxes and noncontrolling interest. |
(2) | Amounts reclassified are included in cost of goods sold. |
(3) | Amounts reclassified are included in the computation of net pension expense (see Note 12 for additional details). |
9. | PROPERTY, PLANT AND EQUIPMENT |
(In millions) | January 3, 2015 | December 28, 2013 | |||||
Land | $ | 4.1 | $ | 3.9 | |||
Buildings and improvements | 114.3 | 119.0 | |||||
Machinery and equipment | 194.9 | 192.1 | |||||
Software | 102.0 | 101.1 | |||||
Gross cost | 415.3 | 416.1 | |||||
Less: accumulated depreciation | 278.5 | 264.2 | |||||
Property, plant and equipment, net | $ | 136.8 | $ | 151.9 |
(In millions) | 2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | |||||||||||||||||
Minimum rental payments | $ | 50.9 | $ | 45.3 | $ | 38.8 | $ | 33.4 | $ | 28.9 | $ | 125.8 |
10. | FINANCIAL INSTRUMENTS AND RISK MANAGEMENT |
Level 1: | Fair value is measured using quoted prices (unadjusted) in active markets for identical assets and liabilities. | |
Level 2: | Fair value is measured using either direct or indirect inputs, other than quoted prices included within Level 1, which are observable for similar assets or liabilities. | |
Level 3: | Fair value is measured using valuation techniques in which one or more significant inputs are unobservable. |
(In millions) | January 3, 2015 | December 28, 2013 | |||||
Carrying value | $ | 900.2 | $ | 1,150.0 | |||
Fair value | 928.4 | 1,183.8 |
(Dollars in millions) | January 3, 2015 | December 28, 2013 | |||||
Foreign exchange contracts: | |||||||
Notional amount | $ | 141.6 | $ | 129.1 | |||
Maturities (in days) | 336 | 364 | |||||
Interest rate swap: | |||||||
Notional amount | $ | 405.4 | $ | 455.5 |
Fair Value Measurements | |||||||
Quoted Prices With Other Observable Inputs (Level 2) | |||||||
(In millions) | January 3, 2015 | December 28, 2013 | |||||
Financial assets: | |||||||
Foreign exchange contracts asset | $ | 8.6 | $ | 1.7 | |||
Interest rate swap asset | 0.6 | 0.9 | |||||
Financial liabilities: | |||||||
Foreign exchange contracts liability | — | 2.3 |
11. | STOCK-BASED COMPENSATION |
Fiscal Year | ||||||||
2014 | 2013 | 2012 | ||||||
Expected market price volatility (1) | 29.6 | % | 33.2 | % | 37.8 | % | ||
Risk-free interest rate (2) | 1.2 | % | 0.6 | % | 0.6 | % | ||
Dividend yield (3) | 0.9 | % | 1.2 | % | 1.3 | % | ||
Expected term (4) | 4 years | 4 years | 4 years |
(1) | Based on historical volatility of the Company’s common stock. The expected volatility is based on the daily percentage change in the price of the stock over the four years prior to the grant. |
(2) | Represents the U.S. Treasury yield curve in effect for the expected term of the option at the time of grant. |
(3) | Represents the Company’s estimated cash dividend yield for the expected term. |
(4) | Represents the period of time that options granted are expected to be outstanding. As part of the determination of the expected term, the Company concluded that all employee groups exhibit similar exercise and post-vesting termination behavior. |
Shares Under Option | Weighted-Average Exercise Price | Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (In millions) | |||||||||
Outstanding at December 31, 2011 | 7,389,968 | $ | 11.70 | 5.5 | $ | 45.7 | ||||||
Granted | 902,554 | 19.85 | ||||||||||
Exercised | (2,729,502 | ) | 9.95 | |||||||||
Cancelled | (62,038 | ) | 17.78 | |||||||||
Outstanding at December 29, 2012 | 5,500,982 | $ | 13.84 | 5.9 | $ | 34.4 | ||||||
Granted | 1,489,813 | 21.76 | ||||||||||
Exercised | (851,874 | ) | 11.46 | |||||||||
Cancelled | (107,680 | ) | 20.89 | |||||||||
Outstanding at December 28, 2013 | 6,031,241 | $ | 16.00 | 6.2 | $ | 104.9 | ||||||
Granted | 1,349,849 | 27.09 | ||||||||||
Exercised | (737,402 | ) | 13.15 | |||||||||
Cancelled | (245,695 | ) | 24.16 | |||||||||
Outstanding at January 3, 2015 | 6,397,993 | $ | 18.36 | 6.2 | $ | 68.3 | ||||||
Estimated forfeitures | (9,836 | ) | ||||||||||
Vested or expected to vest at January 3, 2015 | 6,388,157 | $ | 18.35 | 6.2 | $ | 68.3 | ||||||
Nonvested at January 3, 2015 and expected to vest | (2,037,458 | ) | ||||||||||
Exercisable at January 3, 2015 | 4,350,699 | $ | 15.47 | 5.1 | $ | 59.0 |
Restricted Awards | Weighted- Average Grant Date Fair Value | Performance Awards | Weighted- Average Grant Date Fair Value | ||||||||||
Nonvested at December 31, 2011 | 1,491,858 | $ | 12.89 | 1,282,660 | $ | 12.69 | |||||||
Granted | 703,348 | 20.14 | 401,190 | 19.89 | |||||||||
Vested | (730,434 | ) | 12.51 | (872,352 | ) | 10.63 | |||||||
Forfeited | (66,310 | ) | 16.13 | (32,104 | ) | 12.82 | |||||||
Nonvested at December 29, 2012 | 1,398,462 | $ | 16.58 | 779,394 | $ | 18.93 | |||||||
Granted | 744,287 | 22.18 | 789,814 | 21.52 | |||||||||
Vested | (102,724 | ) | 15.35 | (28,580 | ) | 13.62 | |||||||
Forfeited | (109,600 | ) | 19.96 | (109,628 | ) | 20.99 | |||||||
Nonvested at December 28, 2013 | 1,930,425 | $ | 18.61 | 1,431,000 | $ | 20.31 | |||||||
Granted | 689,345 | 27.09 | 609,335 | 27.03 | |||||||||
Vested | (700,543 | ) | 16.49 | (244,625 | ) | 18.85 | |||||||
Forfeited | (192,045 | ) | 22.39 | (304,940 | ) | 20.27 | |||||||
Nonvested at January 3, 2015 | 1,727,182 | $ | 22.44 | 1,490,770 | $ | 23.30 |
12. | RETIREMENT PLANS |
Fiscal Year | |||||||
(In millions) | 2014 | 2013 | |||||
Change in projected benefit obligations: | |||||||
Projected benefit obligations at beginning of the year | $ | 395.4 | $ | 445.2 | |||
Service cost pertaining to benefits earned during the year | 7.2 | 9.0 | |||||
Interest cost on projected benefit obligations | 20.3 | 18.8 | |||||
Actuarial (gains) losses | 66.2 | (62.3 | ) | ||||
Benefits paid to plan participants | (32.2 | ) | (15.3 | ) | |||
Settlements | (24.0 | ) | — | ||||
Projected benefit obligations at end of the year | $ | 432.9 | $ | 395.4 | |||
Change in fair value of pension assets: | |||||||
Fair value of pension assets at beginning of the year | $ | 319.6 | $ | 277.3 | |||
Actual return on plan assets | 32.5 | 53.1 | |||||
Company contributions - pension | 3.9 | 2.4 | |||||
Company contributions - SERP | 2.3 | 2.1 | |||||
Benefits paid to plan participants | (32.2 | ) | (15.3 | ) | |||
Settlements | (24.0 | ) | — | ||||
Fair value of pension assets at end of the year | $ | 302.1 | $ | 319.6 | |||
Funded status | $ | (130.8 | ) | $ | (75.8 | ) | |
Amounts recognized in the consolidated balance sheets: | |||||||
Non-current assets | $ | 1.1 | $ | 2.3 | |||
Current liabilities | (3.8 | ) | (3.9 | ) | |||
Non-current liabilities | (128.1 | ) | (74.2 | ) | |||
Net amount recognized | $ | (130.8 | ) | $ | (75.8 | ) | |
Amounts recognized in accumulated other comprehensive loss: | |||||||
Unrecognized net actuarial loss (amounts net of tax: $(41.5) and $(9.3)) | $ | (62.6 | ) | $ | (13.1 | ) | |
Unrecognized prior service cost (amounts net of tax: $(0.1) and $(0.2)) | (0.1 | ) | (0.2 | ) | |||
Net amount recognized | $ | (62.7 | ) | $ | (13.3 | ) | |
Funded status of pension plans and SERP (supplemental): | |||||||
Funded status of qualified defined benefit plans and SERP | $ | (130.8 | ) | $ | (75.8 | ) | |
Nonqualified trust assets (cash surrender value of life insurance) recorded in other assets and intended to satisfy the projected benefit obligation of unfunded SERP obligations | 53.4 | 49.4 | |||||
Net funded status of pension plans and SERP (supplemental) | $ | (77.4 | ) | $ | (26.4 | ) |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
Service cost pertaining to benefits earned during the year | $ | 7.2 | $ | 9.0 | $ | 7.7 | |||||
Interest cost on projected benefit obligations | 20.3 | 18.8 | 15.3 | ||||||||
Expected return on pension assets | (22.1 | ) | (21.0 | ) | (15.9 | ) | |||||
Net amortization loss | 7.5 | 30.5 | 20.8 | ||||||||
Settlement gain | (1.0 | ) | — | — | |||||||
Net pension expense | $ | 11.9 | $ | 37.3 | $ | 27.9 | |||||
Less: SERP expense | 7.6 | 8.1 | 7.7 | ||||||||
Qualified defined benefit pension plans expense | $ | 4.3 | $ | 29.2 | $ | 20.2 |
Fiscal Year | |||
2014 | 2013 | ||
Weighted-average assumptions used to determine benefit obligations at fiscal year-end: | |||
Discount rate | 4.37% | 5.26% | |
Rate of compensation increase - pension | 4.85% | 4.85% | |
Rate of compensation increase - SERP | 7.00% | 7.00% | |
Weighted average assumptions used to determine net periodic benefit cost for the years ended: | |||
Discount rate | 5.26% | 4.30% | |
Expected long-term rate of return on plan assets | 7.50% | 7.68% | |
Rate of compensation increase - pension | 4.85% | 4.85% | |
Rate of compensation increase - SERP | 7.00% | 7.00% |
January 3, 2015 | ||||||||||||||||||
(In millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Equity securities | $ | — | $ | 195.6 | $ | — | $ | 195.6 | 64.7 | % | ||||||||
Fixed income investments | — | 105.9 | 0.3 | 106.2 | 35.2 | % | ||||||||||||
Other | — | — | 0.3 | 0.3 | 0.1 | % | ||||||||||||
Fair value of plan assets | $ | — | $ | 301.5 | $ | 0.6 | $ | 302.1 | 100.0 | % |
December 28, 2013 | ||||||||||||||||||
(In millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Equity securities | $ | 15.4 | $ | 196.1 | $ | — | $ | 211.5 | 66.0 | % | ||||||||
Fixed income investments | 26.7 | 81.2 | — | 107.9 | 33.6 | % | ||||||||||||
Cash and money market investments | 1.4 | — | — | 1.4 | 0.4 | % | ||||||||||||
Fair value of plan assets | $ | 43.5 | $ | 277.3 | $ | — | $ | 320.8 | 100.0 | % | ||||||||
Expenses payable to plan sponsor | (1.2 | ) | ||||||||||||||||
Fair value of plan assets | $ | 319.6 |
(In millions) | 2015 | 2016 | 2017 | 2018 | 2019 | 2020-2024 | |||||||||||||||||
Expected benefit payments | $ | 19.3 | $ | 20.0 | $ | 20.5 | $ | 21.0 | $ | 21.5 | $ | 118.4 |
13. | INCOME TAXES |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
United States | $ | 132.4 | $ | 76.7 | $ | 38.3 | |||||
Foreign | 49.1 | 51.0 | 55.9 | ||||||||
Earnings before income taxes | $ | 181.5 | $ | 127.7 | $ | 94.2 |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
Current expense: | |||||||||||
Federal | $ | 42.1 | $ | 37.1 | $ | 15.3 | |||||
State | 5.6 | 2.2 | 1.4 | ||||||||
Foreign | 18.0 | 15.0 | 3.1 | ||||||||
Deferred expense (credit): | |||||||||||
Federal | (9.3 | ) | (23.5 | ) | (5.1 | ) | |||||
State | (6.6 | ) | (3.0 | ) | (0.4 | ) | |||||
Foreign | (2.2 | ) | (1.1 | ) | (0.9 | ) | |||||
Income tax provision | $ | 47.6 | $ | 26.7 | $ | 13.4 |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
Income taxes at U.S. statutory rate (35%) | $ | 63.5 | $ | 44.7 | $ | 33.0 | |||||
State income taxes, net of federal income tax | 3.7 | 0.5 | 0.2 | ||||||||
(Nontaxable earnings) non-deductible losses of foreign affiliates: | |||||||||||
Cayman Islands | (5.5 | ) | (5.4 | ) | (4.6 | ) | |||||
Bermuda | (0.4 | ) | 2.7 | 1.7 | |||||||
Dominican Republic | 1.1 | 1.7 | (2.0 | ) | |||||||
Tax credits | (0.7 | ) | (2.2 | ) | — | ||||||
Foreign earnings taxed at rates different from the U.S. statutory rate: | |||||||||||
Hong Kong | (16.4 | ) | (17.1 | ) | (12.2 | ) | |||||
Other | 3.6 | 3.1 | (1.6 | ) | |||||||
Adjustments for uncertain tax positions | — | (1.2 | ) | (6.7 | ) | ||||||
Change in valuation allowance | (19.2 | ) | 0.1 | 0.7 | |||||||
Change in state tax rates | (6.0 | ) | (2.0 | ) | — | ||||||
Gain on intercompany sale of subsidiary stock | 23.2 | — | — | ||||||||
Non-deductible expenses | 1.1 | 0.9 | 4.9 | ||||||||
Other | (0.4 | ) | 0.9 | — | |||||||
Income tax provision | $ | 47.6 | $ | 26.7 | $ | 13.4 |
(In millions) | January 3, 2015 | December 28, 2013 | |||||
Deferred income tax assets: | |||||||
Accounts receivable and inventory valuation allowances | $ | 16.6 | $ | 18.7 | |||
Deferred compensation accruals | 10.9 | 11.0 | |||||
Accrued pension expense | 47.2 | 26.6 | |||||
Stock-based compensation | 20.2 | 16.2 | |||||
Net operating loss, capital loss and foreign tax credit carryforward | 13.9 | 32.1 | |||||
Other amounts not deductible until paid | 14.2 | 9.2 | |||||
Other | 1.0 | 0.7 | |||||
Total gross deferred income tax assets | 124.0 | 114.5 | |||||
Less valuation allowance | (10.5 | ) | (29.7 | ) | |||
Net deferred income tax assets | 113.5 | 84.8 | |||||
Deferred income tax liabilities: | |||||||
Tax depreciation in excess of book depreciation | (3.8 | ) | (5.3 | ) | |||
Intangible assets | (288.5 | ) | (294.8 | ) | |||
Other | (10.3 | ) | (6.1 | ) | |||
Total deferred income tax liabilities | (302.6 | ) | (306.2 | ) | |||
Net deferred income tax liabilities | $ | (189.1 | ) | $ | (221.4 | ) |
Fiscal Year | |||||||
(In millions) | 2014 | 2013 | |||||
Beginning balance | $ | 8.6 | $ | 9.8 | |||
Increases related to current year tax positions | 1.7 | 2.0 | |||||
Decreases related to prior year positions | (1.3 | ) | (0.4 | ) | |||
Decrease due to lapse of statute | (0.4 | ) | (2.8 | ) | |||
Ending balance | $ | 8.6 | $ | 8.6 |
14. | LITIGATION AND CONTINGENCIES |
(In millions) | 2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | |||||||||||||||||
Minimum royalties | $ | 1.8 | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Minimum advertising | 8.7 | 2.7 | 2.8 | 2.9 | 3.0 | 6.3 |
15. | BUSINESS SEGMENTS |
• | Lifestyle Group, consisting of Sperry Top-Sider® footwear and apparel, Stride Rite® footwear and apparel, Hush Puppies® footwear and apparel, Keds® footwear and apparel and Soft Style® footwear; |
• | Performance Group, consisting of Merrell® footwear and apparel, Saucony® footwear and apparel, Chaco® footwear, Patagonia® footwear and Cushe® footwear; and |
• | Heritage Group, consisting of Wolverine® footwear and apparel, Cat® footwear, Bates® uniform footwear, Sebago® footwear and apparel, Harley-Davidson® footwear and HyTest® safety footwear. |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
Revenue: | |||||||||||
Lifestyle Group | $ | 1,059.3 | $ | 1,086.6 | $ | 309.6 | |||||
Performance Group | 990.7 | 945.8 | 674.6 | ||||||||
Heritage Group | 607.0 | 567.4 | 563.9 | ||||||||
Other | 104.1 | 91.3 | 92.7 | ||||||||
Total | $ | 2,761.1 | $ | 2,691.1 | $ | 1,640.8 | |||||
Operating profit (loss): | |||||||||||
Lifestyle Group | $ | 130.2 | $ | 168.2 | $ | 44.6 | |||||
Performance Group | 197.6 | 179.8 | 128.4 | ||||||||
Heritage Group | 95.4 | 85.7 | 83.5 | ||||||||
Other | 3.9 | 0.2 | (1.1 | ) | |||||||
Corporate | (197.2 | ) | (241.6 | ) | (141.7 | ) | |||||
Total | $ | 229.9 | $ | 192.3 | $ | 113.7 | |||||
Depreciation and amortization expense: | |||||||||||
Lifestyle Group | $ | 7.5 | $ | 6.5 | $ | 2.0 | |||||
Performance Group | 3.5 | 3.7 | 3.0 | ||||||||
Heritage Group | 1.1 | 1.2 | 1.2 | ||||||||
Other | 4.0 | 4.1 | 4.0 | ||||||||
Corporate | 37.2 | 40.7 | 17.5 | ||||||||
Total | $ | 53.3 | $ | 56.2 | $ | 27.7 | |||||
Capital expenditures: | |||||||||||
Lifestyle Group | $ | 9.1 | $ | 18.3 | $ | 1.7 | |||||
Performance Group | 3.6 | 3.3 | 1.9 | ||||||||
Heritage Group | 0.5 | 0.9 | 0.3 | ||||||||
Other | 4.3 | 5.4 | 2.5 | ||||||||
Corporate | 12.5 | 13.8 | 8.5 | ||||||||
Total | $ | 30.0 | $ | 41.7 | $ | 14.9 |
(In millions) | January 3, 2015 | December 28, 2013 | December 29, 2012 | ||||||||
Total assets: | |||||||||||
Lifestyle Group | $ | 1,378.8 | $ | 1,431.1 | $ | 1,338.3 | |||||
Performance Group | 485.8 | 476.4 | 513.7 | ||||||||
Heritage Group | 246.4 | 247.2 | 319.0 | ||||||||
Other | 52.1 | 56.9 | 80.8 | ||||||||
Corporate | 341.4 | 410.6 | 362.6 | ||||||||
Total | $ | 2,504.5 | $ | 2,622.2 | $ | 2,614.4 | |||||
Goodwill: | |||||||||||
Lifestyle Group | $ | 323.8 | $ | 329.0 | $ | 349.5 | |||||
Performance Group | 92.5 | 92.8 | 87.0 | ||||||||
Heritage Group | 22.5 | 23.5 | 23.4 | ||||||||
Total | $ | 438.8 | $ | 445.3 | $ | 459.9 |
Fiscal Year | |||||||||||
(In millions) | 2014 | 2013 | 2012 | ||||||||
United States | $ | 1,990.2 | $ | 1,984.8 | $ | 1,079.9 | |||||
Foreign: | |||||||||||
Europe, Middle East and Africa | 391.0 | 362.0 | 310.1 | ||||||||
Canada | 163.0 | 166.2 | 112.6 | ||||||||
Other | 216.9 | 178.1 | 138.2 | ||||||||
Total from foreign territories | 770.9 | 706.3 | 560.9 | ||||||||
Total revenue | $ | 2,761.1 | $ | 2,691.1 | $ | 1,640.8 |
(In millions) | January 3, 2015 | December 28, 2013 | December 29, 2012 | ||||||||
United States | $ | 126.8 | $ | 136.7 | $ | 136.8 | |||||
Foreign countries | 10.0 | 15.2 | 14.2 | ||||||||
Total | $ | 136.8 | $ | 151.9 | $ | 151.0 |
16. | RESTRUCTURING ACTIVITIES |
(In millions) | Severance and employee related | Impairment of property and equipment | Costs associated with exit or disposal activities | Total | |||||||||||
Balance at December 28, 2013 | $ | — | $ | — | $ | — | $ | — | |||||||
Restructuring costs | 2.6 | 5.5 | 13.1 | 21.2 | |||||||||||
Amounts paid | (1.6 | ) | — | (3.4 | ) | (5.0 | ) | ||||||||
Charges against assets | — | (5.5 | ) | (3.2 | ) | (8.7 | ) | ||||||||
Balance at January 3, 2015 | $ | 1.0 | $ | — | $ | 6.5 | $ | 7.5 |
(In millions) | Fair Value | Impairment | |||||
Property and equipment | $ | 0.6 | $ | 5.5 |
(In millions) | Severance and employee related | Costs associated with exit or disposal activities | Total | ||||||||
Balance at December 29, 2012 | $ | — | $ | — | $ | — | |||||
Restructuring costs | 1.4 | 6.2 | 7.6 | ||||||||
Amounts paid | (1.4 | ) | — | (1.4 | ) | ||||||
Charges against assets | — | (5.7 | ) | (5.7 | ) | ||||||
Balance at December 28, 2013 | $ | — | $ | 0.5 | $ | 0.5 | |||||
Restructuring costs | 0.1 | 0.9 | 1.0 | ||||||||
Amounts paid | (0.1 | ) | (1.2 | ) | (1.3 | ) | |||||
Charges against assets | — | (0.2 | ) | (0.2 | ) | ||||||
Balance at January 3, 2015 | $ | — | $ | — | $ | — |
17. | BUSINESS ACQUISITIONS |
(In millions) | Initial valuation at December 29, 2012 | Measurement period adjustments | Final valuation at December 28, 2013 | ||||||||
Cash | $ | 23.6 | $ | — | $ | 23.6 | |||||
Accounts receivable | 146.9 | 4.3 | 151.2 | ||||||||
Inventories | 203.5 | — | 203.5 | ||||||||
Deferred income taxes | 13.6 | — | 13.6 | ||||||||
Other current assets | 13.2 | — | 13.2 | ||||||||
Property, plant and equipment | 77.1 | — | 77.1 | ||||||||
Goodwill | 419.6 | (10.8 | ) | 408.8 | |||||||
Intangible assets | 820.6 | 1.2 | 821.8 | ||||||||
Other | 11.2 | — | 11.2 | ||||||||
Total assets acquired | 1,729.3 | (5.3 | ) | 1,724.0 | |||||||
Accounts payable | 97.4 | — | 97.4 | ||||||||
Other accrued liabilities | 40.0 | 2.2 | 42.2 | ||||||||
Deferred income taxes | 294.7 | (7.5 | ) | 287.2 | |||||||
Accrued pension liabilities | 37.7 | — | 37.7 | ||||||||
Other liabilities | 10.0 | — | 10.0 | ||||||||
Total liabilities assumed | 479.8 | (5.3 | ) | 474.5 | |||||||
Net assets acquired | $ | 1,249.5 | $ | — | $ | 1,249.5 |
(In millions) | Goodwill from the acquisition of PLG | ||
Performance Group | $ | 82.5 | |
Lifestyle Group | 326.3 | ||
Total | $ | 408.8 |
(In millions) | Intangible asset | Useful life | |||
Trade names and trademarks | $ | 671.8 | Indefinite | ||
Customer lists | 100.5 | 3-20 years | |||
Licensing agreements | 28.8 | 4-5 years | |||
Developed product technology | 14.9 | 3-5 years | |||
Backlog | 5.2 | 6 months | |||
Net favorable leases | 0.6 | 10 years | |||
Total intangible assets acquired | $ | 821.8 |
18. | SUBSIDIARY GUARANTORS OF THE PUBLIC BONDS |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Revenue | $ | 607.8 | $ | 3,276.1 | $ | 848.8 | $ | (1,971.6 | ) | $ | 2,761.1 | ||||||||
Cost of goods sold | 442.9 | 2,594.9 | 483.5 | (1,847.5 | ) | 1,673.8 | |||||||||||||
Restructuring costs | 0.1 | — | 0.9 | — | 1.0 | ||||||||||||||
Gross profit | 164.8 | 681.2 | 364.4 | (124.1 | ) | 1,086.3 | |||||||||||||
Selling, general and administrative expenses | 126.1 | 555.1 | 258.1 | (124.1 | ) | 815.2 | |||||||||||||
Acquisition-related integration costs | 6.5 | 1.1 | 7.6 | — | 15.2 | ||||||||||||||
Restructuring costs | 3.0 | 10.4 | 12.6 | — | 26.0 | ||||||||||||||
Operating profit | 29.2 | 114.6 | 86.1 | — | 229.9 | ||||||||||||||
Other expenses: | |||||||||||||||||||
Interest expense, net | 45.4 | 0.1 | (0.1 | ) | — | 45.4 | |||||||||||||
Debt extinguishment costs | 1.3 | — | — | — | 1.3 | ||||||||||||||
Other expense (income), net | — | (1.3 | ) | 3.0 | — | 1.7 | |||||||||||||
Total other expense (income) | 46.7 | (1.2 | ) | 2.9 | — | 48.4 | |||||||||||||
Earnings (loss) before income taxes | (17.5 | ) | 115.8 | 83.2 | — | 181.5 | |||||||||||||
Income tax expense | 0.7 | 37.7 | 9.2 | — | 47.6 | ||||||||||||||
Earnings (loss) before equity in earnings of consolidated subsidiaries | (18.2 | ) | 78.1 | 74.0 | — | 133.9 | |||||||||||||
Equity in earnings of consolidated subsidiaries | 151.3 | 9.4 | 74.7 | (235.4 | ) | — | |||||||||||||
Net earnings | 133.1 | 87.5 | 148.7 | (235.4 | ) | 133.9 | |||||||||||||
Less: net earnings attributable to noncontrolling interest | — | — | 0.8 | — | 0.8 | ||||||||||||||
Net earnings attributable to Wolverine World Wide, Inc. | $ | 133.1 | $ | 87.5 | $ | 147.9 | $ | (235.4 | ) | $ | 133.1 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Net earnings | $ | 133.1 | $ | 87.5 | $ | 148.7 | $ | (235.4 | ) | $ | 133.9 | ||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||||||
Foreign currency translation adjustments | (17.4 | ) | — | (18.5 | ) | 17.4 | (18.5 | ) | |||||||||||
Change in fair value of foreign exchange contracts | 9.4 | — | 9.4 | (9.4 | ) | 9.4 | |||||||||||||
Change in fair value of interest rate swap | (0.2 | ) | — | — | — | (0.2 | ) | ||||||||||||
Pension adjustments | (32.1 | ) | (10.3 | ) | — | 10.3 | (32.1 | ) | |||||||||||
Other comprehensive income (loss) | (40.3 | ) | (10.3 | ) | (9.1 | ) | 18.3 | (41.4 | ) | ||||||||||
Comprehensive income | 92.8 | 77.2 | 139.6 | (217.1 | ) | 92.5 | |||||||||||||
Less: comprehensive (loss) income attributable to noncontrolling interest | — | — | (0.3 | ) | — | (0.3 | ) | ||||||||||||
Comprehensive income attributable to Wolverine World Wide, Inc. | $ | 92.8 | $ | 77.2 | $ | 139.9 | $ | (217.1 | ) | $ | 92.8 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Revenue | $ | 538.2 | $ | 3,849.1 | $ | 774.4 | $ | (2,470.6 | ) | $ | 2,691.1 | ||||||||
Cost of goods sold | 383.8 | 3,207.9 | 415.4 | (2,388.1 | ) | 1,619.0 | |||||||||||||
Restructuring costs | 0.1 | — | 7.5 | — | 7.6 | ||||||||||||||
Gross profit | 154.3 | 641.2 | 351.5 | (82.5 | ) | 1,064.5 | |||||||||||||
Selling, general and administrative expenses | 139.0 | 506.7 | 266.8 | (82.5 | ) | 830.0 | |||||||||||||
Acquisition-related integration costs | 16.9 | 14.9 | 9.7 | — | 41.5 | ||||||||||||||
Restructuring costs | — | — | 0.7 | — | 0.7 | ||||||||||||||
Operating profit (loss) | (1.6 | ) | 119.6 | 74.3 | — | 192.3 | |||||||||||||
Other expenses: | |||||||||||||||||||
Interest expense, net | 52.1 | (0.2 | ) | 0.1 | — | 52.0 | |||||||||||||
Debt extinguishment costs | 13.1 | — | — | — | 13.1 | ||||||||||||||
Other expense (income), net | (3.7 | ) | 0.1 | 3.1 | — | (0.5 | ) | ||||||||||||
Total other expense (income) | 61.5 | (0.1 | ) | 3.2 | — | 64.6 | |||||||||||||
Earnings (loss) before income taxes | (63.1 | ) | 119.7 | 71.1 | — | 127.7 | |||||||||||||
Income tax expense | 1.5 | 19.3 | 5.9 | — | 26.7 | ||||||||||||||
Earnings (loss) before equity in earnings of consolidated subsidiaries | (64.6 | ) | 100.4 | 65.2 | — | 101.0 | |||||||||||||
Equity in earnings of consolidated subsidiaries | 165.0 | 114.5 | 21.7 | (301.2 | ) | — | |||||||||||||
Net earnings | 100.4 | 214.9 | 86.9 | (301.2 | ) | 101.0 | |||||||||||||
Less: net earnings attributable to noncontrolling interest | — | — | 0.6 | — | 0.6 | ||||||||||||||
Net earnings attributable to Wolverine World Wide, Inc. | $ | 100.4 | $ | 214.9 | $ | 86.3 | $ | (301.2 | ) | $ | 100.4 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Net earnings | $ | 100.4 | $ | 214.9 | $ | 86.9 | $ | (301.2 | ) | $ | 101.0 | ||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||||||
Foreign currency translation adjustments | (5.4 | ) | — | (5.4 | ) | 5.4 | (5.4 | ) | |||||||||||
Change in fair value of foreign exchange contracts | 0.9 | — | 0.9 | (0.9 | ) | 0.9 | |||||||||||||
Change in fair value of interest rate swap | 1.6 | — | — | — | 1.6 | ||||||||||||||
Pension adjustments | 81.2 | 13.1 | — | (13.1 | ) | 81.2 | |||||||||||||
Other comprehensive income (loss) | 78.3 | 13.1 | (4.5 | ) | (8.6 | ) | 78.3 | ||||||||||||
Comprehensive (loss) income | 178.7 | 228.0 | 82.4 | (309.8 | ) | 179.3 | |||||||||||||
Less: comprehensive (loss) income attributable to noncontrolling interest | (0.1 | ) | — | 0.6 | — | 0.5 | |||||||||||||
Comprehensive income attributable to Wolverine World Wide, Inc. | $ | 178.8 | $ | 228.0 | $ | 81.8 | $ | (309.8 | ) | $ | 178.8 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Revenue | $ | 527.1 | $ | 1,065.7 | $ | 539.2 | $ | (491.2 | ) | $ | 1,640.8 | ||||||||
Cost of goods sold | 390.6 | 780.6 | 277.1 | (440.2 | ) | 1,008.1 | |||||||||||||
Acquisition-related transaction and integration costs | 0.8 | 3.7 | — | — | 4.5 | ||||||||||||||
Gross profit | 135.7 | 281.4 | 262.1 | (51.0 | ) | 628.2 | |||||||||||||
Selling, general and administrative expenses | 123.0 | 206.0 | 204.7 | (51.7 | ) | 482.0 | |||||||||||||
Acquisition-related transaction and integration costs | 31.3 | 1.2 | — | — | 32.5 | ||||||||||||||
Operating profit (loss) | (18.6 | ) | 74.2 | 57.4 | 0.7 | 113.7 | |||||||||||||
Other expenses: | |||||||||||||||||||
Interest expense, net | 13.9 | (0.2 | ) | 0.3 | — | 14.0 | |||||||||||||
Acquisition-related interest expense | 5.2 | — | — | — | 5.2 | ||||||||||||||
Other expense (income), net | 0.4 | (0.2 | ) | 0.1 | — | 0.3 | |||||||||||||
Total other expense (income) | 19.5 | (0.4 | ) | 0.4 | — | 19.5 | |||||||||||||
Earnings (loss) before income taxes | (38.1 | ) | 74.6 | 57.0 | 0.7 | 94.2 | |||||||||||||
Income tax expense (benefit) | 12.3 | (0.1 | ) | 1.2 | — | 13.4 | |||||||||||||
Earnings (loss) before equity in earnings of consolidated subsidiaries | (50.4 | ) | 74.7 | 55.8 | 0.7 | 80.8 | |||||||||||||
Equity in earnings of consolidated subsidiaries | 131.1 | 54.4 | 61.2 | (246.7 | ) | — | |||||||||||||
Net earnings | 80.7 | 129.1 | 117.0 | (246.0 | ) | 80.8 | |||||||||||||
Less: net earnings attributable to noncontrolling interest | — | — | 0.1 | — | 0.1 | ||||||||||||||
Net earnings attributable to Wolverine World Wide, Inc. | $ | 80.7 | $ | 129.1 | $ | 116.9 | $ | (246.0 | ) | $ | 80.7 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Net earnings | $ | 80.7 | $ | 129.1 | $ | 117.0 | $ | (246.0 | ) | $ | 80.8 | ||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||||||
Foreign currency translation adjustments | 5.7 | — | 5.7 | (5.7 | ) | 5.7 | |||||||||||||
Change in fair value of foreign exchange contracts | (5.0 | ) | — | (5.0 | ) | 5.0 | (5.0 | ) | |||||||||||
Change in fair value of interest rate swap | (1.0 | ) | — | — | — | (1.0 | ) | ||||||||||||
Pension adjustments | (16.2 | ) | — | — | — | (16.2 | ) | ||||||||||||
Other comprehensive (loss) income | (16.5 | ) | — | 0.7 | (0.7 | ) | (16.5 | ) | |||||||||||
Comprehensive income | 64.2 | 129.1 | 117.7 | (246.7 | ) | 64.3 | |||||||||||||
Less comprehensive income (loss) attributable to noncontrolling interest | (0.1 | ) | — | 0.1 | — | — | |||||||||||||
Comprehensive income attributable to Wolverine World Wide, Inc. | $ | 64.3 | $ | 129.1 | $ | 117.6 | $ | (246.7 | ) | $ | 64.3 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 11.4 | $ | 3.3 | $ | 209.1 | $ | — | $ | 223.8 | |||||||||
Accounts receivable, net | 18.8 | 181.4 | 112.5 | — | 312.7 | ||||||||||||||
Inventories: | |||||||||||||||||||
Finished products, net | 59.5 | 260.0 | 78.6 | — | 398.1 | ||||||||||||||
Raw materials and work-in-process, net | 2.1 | 1.3 | 12.5 | — | 15.9 | ||||||||||||||
Total inventories | 61.6 | 261.3 | 91.1 | — | 414.0 | ||||||||||||||
Deferred income taxes | 12.8 | 14.0 | 1.3 | — | 28.1 | ||||||||||||||
Prepaid expenses and other current assets | 24.8 | 21.4 | 17.4 | — | 63.6 | ||||||||||||||
Total current assets | 129.4 | 481.4 | 431.4 | — | 1,042.2 | ||||||||||||||
Property, plant and equipment: | |||||||||||||||||||
Gross cost | 230.7 | 150.7 | 33.9 | — | 415.3 | ||||||||||||||
Accumulated depreciation | (183.3 | ) | (72.6 | ) | (22.6 | ) | — | (278.5 | ) | ||||||||||
Property, plant and equipment, net | 47.4 | 78.1 | 11.3 | — | 136.8 | ||||||||||||||
Other assets: | |||||||||||||||||||
Goodwill | 7.9 | 353.0 | 77.9 | — | 438.8 | ||||||||||||||
Indefinite-lived intangibles | 4.3 | 674.9 | 11.3 | — | 690.5 | ||||||||||||||
Amortizable intangibles, net | 0.6 | 111.5 | — | — | 112.1 | ||||||||||||||
Deferred income taxes | — | — | 2.8 | — | 2.8 | ||||||||||||||
Deferred financing costs, net | 16.5 | — | — | — | 16.5 | ||||||||||||||
Other | 49.8 | 11.9 | 3.1 | — | 64.8 | ||||||||||||||
Intercompany accounts receivable | 22.1 | 2,225.4 | 621.1 | (2,868.6 | ) | — | |||||||||||||
Investment in affiliates | 3,158.2 | 608.8 | 1,221.3 | (4,988.3 | ) | — | |||||||||||||
Total other assets | 3,259.4 | 3,985.5 | 1,937.5 | (7,856.9 | ) | 1,325.5 | |||||||||||||
Total assets | $ | 3,436.2 | $ | 4,545.0 | $ | 2,380.2 | $ | (7,856.9 | ) | $ | 2,504.5 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Accounts payable | $ | 37.5 | $ | 66.4 | $ | 45.5 | $ | — | $ | 149.4 | |||||||||
Accrued salaries and wages | 23.2 | 6.0 | 6.9 | — | 36.1 | ||||||||||||||
Other accrued liabilities | 31.6 | 40.9 | 36.0 | — | 108.5 | ||||||||||||||
Current maturities of long-term debt | 46.7 | — | — | — | 46.7 | ||||||||||||||
Total current liabilities | 139.0 | 113.3 | 88.4 | — | 340.7 | ||||||||||||||
Long-term debt, less current maturities | 853.5 | 0.6 | — | — | 854.1 | ||||||||||||||
Accrued pension liabilities | 106.6 | 21.5 | — | — | 128.1 | ||||||||||||||
Deferred income taxes | (60.7 | ) | 274.7 | 3.0 | — | 217.0 | |||||||||||||
Other liabilities | 13.3 | 10.6 | 2.7 | — | 26.6 | ||||||||||||||
Intercompany accounts payable | 1,451.0 | 734.5 | 683.1 | (2,868.6 | ) | — | |||||||||||||
Stockholders’ equity | |||||||||||||||||||
Wolverine World Wide, Inc. stockholders’ equity | 933.5 | 3,389.8 | 1,598.5 | (4,988.3 | ) | 933.5 | |||||||||||||
Noncontrolling interest | — | — | 4.5 | — | 4.5 | ||||||||||||||
Total stockholders’ equity | 933.5 | 3,389.8 | 1,603.0 | (4,988.3 | ) | 938.0 | |||||||||||||
Total liabilities and stockholders’ equity | $ | 3,436.2 | $ | 4,545.0 | $ | 2,380.2 | $ | (7,856.9 | ) | $ | 2,504.5 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
ASSETS | |||||||||||||||||||
Current assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 18.8 | $ | 15.0 | $ | 180.4 | $ | — | $ | 214.2 | |||||||||
Accounts receivable, net | 63.9 | 213.2 | 121.0 | — | 398.1 | ||||||||||||||
Inventories: | |||||||||||||||||||
Finished products, net | 55.0 | 270.8 | 81.0 | (0.8 | ) | 406.0 | |||||||||||||
Raw materials and work-in-process, net | (0.1 | ) | 0.9 | 21.4 | — | 22.2 | |||||||||||||
Total inventories | 54.9 | 271.7 | 102.4 | (0.8 | ) | 428.2 | |||||||||||||
Deferred income taxes | 15.3 | 12.6 | 1.2 | — | 29.1 | ||||||||||||||
Prepaid expenses and other current assets | 26.9 | 11.1 | 10.4 | — | 48.4 | ||||||||||||||
Total current assets | 179.8 | 523.6 | 415.4 | (0.8 | ) | 1,118.0 | |||||||||||||
Property, plant and equipment: | |||||||||||||||||||
Gross cost | 223.7 | 143.2 | 49.2 | — | 416.1 | ||||||||||||||
Accumulated depreciation | (174.4 | ) | (57.4 | ) | (32.4 | ) | — | (264.2 | ) | ||||||||||
Property, plant and equipment, net | 49.3 | 85.8 | 16.8 | — | 151.9 | ||||||||||||||
Other assets: | |||||||||||||||||||
Goodwill | 7.7 | 354.3 | 83.3 | — | 445.3 | ||||||||||||||
Indefinite-lived intangibles | 4.4 | 674.7 | 11.4 | — | 690.5 | ||||||||||||||
Amortizable intangibles, net | 0.2 | 126.4 | 0.1 | — | 126.7 | ||||||||||||||
Deferred income taxes | — | — | 3.4 | — | 3.4 | ||||||||||||||
Deferred financing costs, net | 22.0 | — | — | — | 22.0 | ||||||||||||||
Other | 46.0 | 12.3 | 5.3 | 0.8 | 64.4 | ||||||||||||||
Intercompany accounts receivable | — | 1,445.4 | 347.5 | (1,792.9 | ) | — | |||||||||||||
Investment in affiliates | 3,033.2 | 555.6 | 393.5 | (3,982.3 | ) | — | |||||||||||||
Total other assets | 3,113.5 | 3,168.7 | 844.5 | (5,774.4 | ) | 1,352.3 | |||||||||||||
Total assets | $ | 3,342.6 | $ | 3,778.1 | $ | 1,276.7 | $ | (5,775.2 | ) | $ | 2,622.2 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||||
Current liabilities: | |||||||||||||||||||
Accounts payable | $ | 31.6 | $ | 61.7 | $ | 41.9 | $ | — | $ | 135.2 | |||||||||
Accrued salaries and wages | 27.0 | 8.6 | 5.9 | — | 41.5 | ||||||||||||||
Other accrued liabilities | 40.8 | 22.1 | 36.4 | — | 99.3 | ||||||||||||||
Current maturities of long-term debt | 53.3 | — | — | — | 53.3 | ||||||||||||||
Total current liabilities | 152.7 | 92.4 | 84.2 | — | 329.3 | ||||||||||||||
Long-term debt, less current maturities | 1,096.7 | — | — | — | 1,096.7 | ||||||||||||||
Accrued pension liabilities | 60.9 | 13.3 | — | — | 74.2 | ||||||||||||||
Deferred income taxes | (38.2 | ) | 287.7 | 4.4 | — | 253.9 | |||||||||||||
Other liabilities | 12.4 | 11.5 | 2.8 | — | 26.7 | ||||||||||||||
Intercompany accounts payable | 1,220.5 | 153.7 | 418.7 | (1,792.9 | ) | — | |||||||||||||
Stockholders’ equity: | |||||||||||||||||||
Wolverine World Wide, Inc. stockholders’ equity | 837.6 | 3,219.5 | 762.8 | (3,982.3 | ) | 837.6 | |||||||||||||
Noncontrolling interest | — | — | 3.8 | — | 3.8 | ||||||||||||||
Total stockholders’ equity | 837.6 | 3,219.5 | 766.6 | (3,982.3 | ) | 841.4 | |||||||||||||
Total liabilities and stockholders’ equity | $ | 3,342.6 | $ | 3,778.1 | $ | 1,276.7 | $ | (5,775.2 | ) | $ | 2,622.2 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Net cash provided by operating activities | $ | 274.1 | $ | 9.1 | $ | 31.4 | $ | — | $ | 314.6 | |||||||||
Investing activities | |||||||||||||||||||
Additions to property, plant and equipment | (7.7 | ) | (19.6 | ) | (2.7 | ) | — | (30.0 | ) | ||||||||||
Investment in joint ventures | — | — | (1.1 | ) | — | (1.1 | ) | ||||||||||||
Other | (2.4 | ) | (1.2 | ) | (0.1 | ) | — | (3.7 | ) | ||||||||||
Net cash used in investing activities | (10.1 | ) | (20.8 | ) | (3.9 | ) | — | (34.8 | ) | ||||||||||
Financing activities | |||||||||||||||||||
Payments of long-term debt | (249.8 | ) | — | — | — | (249.8 | ) | ||||||||||||
Cash dividends paid | (24.0 | ) | — | — | — | (24.0 | ) | ||||||||||||
Purchases of shares under employee stock plans | (10.5 | ) | — | — | — | (10.5 | ) | ||||||||||||
Proceeds from the exercise of stock options | 7.3 | — | — | — | 7.3 | ||||||||||||||
Excess tax benefits from stock-based compensation | 5.6 | — | — | — | 5.6 | ||||||||||||||
Contributions from noncontrolling interest | — | — | 1.0 | — | 1.0 | ||||||||||||||
Net cash (used in) provided by financing activities | (271.4 | ) | — | 1.0 | — | (270.4 | ) | ||||||||||||
Effect of foreign exchange rate changes | — | — | 0.2 | — | 0.2 | ||||||||||||||
Increase (decrease) in cash and cash equivalents | (7.4 | ) | (11.7 | ) | 28.7 | — | 9.6 | ||||||||||||
Cash and cash equivalents at beginning of the year | 18.8 | 15.0 | 180.4 | — | 214.2 | ||||||||||||||
Cash and cash equivalents at end of the year | $ | 11.4 | $ | 3.3 | $ | 209.1 | $ | — | $ | 223.8 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Net cash provided by (used in) operating activities | $ | 127.1 | $ | (10.0 | ) | $ | 85.2 | $ | — | $ | 202.3 | ||||||||
Investing activities | |||||||||||||||||||
Additions to property, plant and equipment | (11.9 | ) | (25.0 | ) | (4.8 | ) | — | (41.7 | ) | ||||||||||
Proceeds from sale of property, plant and equipment | — | 2.8 | — | 2.8 | |||||||||||||||
Investment in joint ventures | — | — | (2.5 | ) | — | (2.5 | ) | ||||||||||||
Other | (2.9 | ) | (1.3 | ) | 0.9 | — | (3.3 | ) | |||||||||||
Net cash (used in) investing activities | (14.8 | ) | (23.5 | ) | (6.4 | ) | — | (44.7 | ) | ||||||||||
Financing activities | |||||||||||||||||||
Borrowings of long-term debt | 775.0 | — | — | — | 775.0 | ||||||||||||||
Payments of long-term debt | (875.0 | ) | — | — | — | (875.0 | ) | ||||||||||||
Payments of debt issuance costs | (2.3 | ) | — | — | — | (2.3 | ) | ||||||||||||
Cash dividends paid | (23.7 | ) | — | — | — | (23.7 | ) | ||||||||||||
Purchases of shares under employee stock plans | (0.8 | ) | — | — | — | (0.8 | ) | ||||||||||||
Proceeds from the exercise of stock options | 8.6 | — | — | — | 8.6 | ||||||||||||||
Excess tax benefits from stock-based compensation | 3.4 | — | — | — | 3.4 | ||||||||||||||
Contributions from noncontrolling interest | — | — | 2.0 | — | 2.0 | ||||||||||||||
Net cash provided by (used in) financing activities | (114.8 | ) | — | 2.0 | — | (112.8 | ) | ||||||||||||
Effect of foreign exchange rate changes | — | — | (2.0 | ) | — | (2.0 | ) | ||||||||||||
Increase (decrease) in cash and cash equivalents | (2.5 | ) | (33.5 | ) | 78.8 | — | 42.8 | ||||||||||||
Cash and cash equivalents at beginning of the year | 21.3 | 48.5 | 101.6 | — | 171.4 | ||||||||||||||
Cash and cash equivalents at end of the year | $ | 18.8 | $ | 15.0 | $ | 180.4 | $ | — | $ | 214.2 |
(In millions) | Parent | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||||
Net cash provided by operating activities | $ | 11.0 | $ | 26.0 | $ | 54.6 | $ | — | $ | 91.6 | |||||||||
Investing activities | |||||||||||||||||||
Business acquisition, net of cash acquired | (1,160.7 | ) | 23.6 | (88.8 | ) | — | (1,225.9 | ) | |||||||||||
Additions to property, plant and equipment | (10.8 | ) | (4.1 | ) | — | — | (14.9 | ) | |||||||||||
Investment in joint venture | — | — | (2.9 | ) | — | (2.9 | ) | ||||||||||||
Other | (2.4 | ) | — | — | — | (2.4 | ) | ||||||||||||
Net cash (used in) provided by investing activities | (1,173.9 | ) | 19.5 | (91.7 | ) | — | (1,246.1 | ) | |||||||||||
Financing activities | |||||||||||||||||||
Net repayments under revolving credit agreement | (11.0 | ) | — | — | — | (11.0 | ) | ||||||||||||
Borrowings of long-term debt | 1,275.0 | — | — | — | 1,275.0 | ||||||||||||||
Payments of long-term debt | (25.0 | ) | — | (0.5 | ) | — | (25.5 | ) | |||||||||||
Payments of debt issuance costs | (40.1 | ) | — | — | — | (40.1 | ) | ||||||||||||
Cash dividends paid | (23.6 | ) | — | — | — | (23.6 | ) | ||||||||||||
Purchase of common stock for treasury | (2.4 | ) | — | — | — | (2.4 | ) | ||||||||||||
Purchases of shares under employee stock plans | (11.7 | ) | — | — | — | (11.7 | ) | ||||||||||||
Proceeds from the exercise of stock options | 11.6 | — | — | — | 11.6 | ||||||||||||||
Excess tax benefits from stock-based compensation | 9.9 | — | — | — | 9.9 | ||||||||||||||
Contributions from noncontrolling interest | — | — | 1.2 | — | 1.2 | ||||||||||||||
Net cash provided by financing activities | 1,182.7 | — | 0.7 | — | 1,183.4 | ||||||||||||||
Effect of foreign exchange rate changes | — | — | 2.5 | — | 2.5 | ||||||||||||||
Increase (decrease) in cash and cash equivalents | 19.8 | 45.5 | (33.9 | ) | — | 31.4 | |||||||||||||
Cash and cash equivalents at beginning of the year | 1.5 | 3.0 | 135.5 | — | 140.0 | ||||||||||||||
Cash and cash equivalents at end of the year | $ | 21.3 | $ | 48.5 | $ | 101.6 | $ | — | $ | 171.4 |
19. | QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) |
Fiscal 2014 | |||||||||||||||
(In millions, except per share data) | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Revenue | $ | 627.6 | $ | 613.5 | $ | 711.1 | $ | 808.9 | |||||||
Gross profit | 255.8 | 245.7 | 284.7 | 300.1 | |||||||||||
Net earnings attributable to Wolverine World Wide, Inc. | 37.1 | 27.5 | 57.8 | 10.7 | |||||||||||
Net earnings per share: | |||||||||||||||
Basic | $ | 0.37 | $ | 0.28 | $ | 0.58 | $ | 0.11 | |||||||
Diluted | 0.36 | 0.27 | 0.57 | 0.10 |
Fiscal 2013 | |||||||||||||||
(In millions, except per share data) | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Revenue | $ | 645.9 | $ | 587.8 | $ | 716.6 | $ | 740.8 | |||||||
Gross profit | 262.1 | 241.1 | 286.0 | 275.3 | |||||||||||
Net earnings (loss) attributable to Wolverine World Wide, Inc. | 29.8 | 17.9 | 54.4 | (1.7 | ) | ||||||||||
Net earnings (loss) per share: | |||||||||||||||
Basic | $ | 0.30 | $ | 0.18 | $ | 0.55 | $ | (0.02 | ) | ||||||
Diluted | 0.30 | 0.18 | 0.54 | (0.02 | ) |
Item 9. | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
Item 9B. | Other Information |
Item 10. | Directors, Executive Officers and Corporate Governance |
Item 11. | Executive Compensation |
Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
Plan Category (1) | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a) | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights (b) | Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans Excluding Securities Reflected in Column (a)) (c) | ||||||
Equity compensation plans approved by security holders | 6,397,993 | (2), (3) | $18.36 | 7,918,403 | (4) | ||||
Equity compensation plans not approved by security holders | — | — | — | ||||||
Total | 6,397,993 | $18.36 | 7,918,403 |
(1) | Each plan for which aggregated information is provided contains customary anti-dilution provisions that are applicable in the event of a stock split, stock dividend or certain other changes in the Company’s capitalization. |
(2) | Includes: (i) 5,863,065 stock options awarded to employees under the Amended and Restated Stock Incentive Plan of 1999, the Amended and Restated Stock Incentive Plan of 2001, the Amended and Restated Stock Incentive Plan of 2003, the Amended and Restated Stock Incentive Plan of 2005, the Stock Incentive Plan of 2010 and the Stock Incentive Plan of 2013; and (ii) and 534,928 stock options awarded to non-employee directors under the Stock Incentive Plan of 2013, Stock Incentive Plan of 2010, the Amended and Restated Stock Incentive Plan of 2005 and the Amended and Restated Directors’ Stock Option Plan last approved by stockholders in 2002. Column (a) does not include stock units credited to outside directors’ fee accounts or retirement accounts under the Outside Directors’ Deferred Compensation Plan. Stock units do not have an exercise price. Each stock unit credited to a director’s fee account and retirement account under the Outside Directors’ Deferred Compensation Plan will be converted into one share of common stock upon distribution. Column (a) also does not include shares of restricted or unrestricted common stock previously issued under the Company’s equity compensation plans. |
(3) | Of this amount, 2,047,294 options were not exercisable as of January 3, 2015 due to vesting restrictions. |
(4) | Comprised of: (i) 253,575 shares available for issuance under the Outside Directors’ Deferred Compensation Plan upon the retirement of the current directors or upon a change in control; and (ii) 7,664,828 shares issuable under the Stock Incentive Plan of 2013. |
• | Outside Directors’ Deferred Compensation Plan: 253,575 |
• | Stock Incentive Plan of 2013: 2,948,011 |
Item 13. | Certain Relationships and Related Transactions, and Director Independence |
Item 14. | Principal Accounting Fees and Services |
Item 15. | Exhibits, Financial Statement Schedules |
(a) | The following documents are filed as part of this report: |
(1) | Financial Statements Included in Item 8 |
• | Consolidated Statements of Operations for the Fiscal Years Ended January 3, 2015, December 28, 2013 and December 29, 2012. |
• | Consolidated Statements of Comprehensive Income for the Fiscal Years Ended January 3, 2015, December 28, 2013 and December 29, 2012. |
• | Consolidated Balance Sheets as of January 3, 2015 and December 28, 2013. |
• | Consolidated Statements of Cash Flows for the Fiscal Years Ended January 3, 2015, December 28, 2013 and December 29, 2012. |
• | Consolidated Statements of Stockholders’ Equity for the Fiscal Years Ended January 3, 2015, December 28, 2013 and December 29, 2012. |
• | Notes to the Consolidated Financial Statements. |
• | Reports of Independent Registered Public Accounting Firm. |
(2) | Financial Statement Schedules Attached as Appendix A |
• | Schedule II - Valuation and Qualifying Accounts. |
(3) | Exhibits |
WOLVERINE WORLD WIDE, INC. | ||||
Date: | March 3, 2015 | By: | /s/ Blake W. Krueger | |
Blake W. Krueger Chairman, Chief Executive Officer and President (Principal Executive Officer) |
Signature | Title | Date | |||
/s/ Blake W. Krueger | Chairman, Chief Executive Officer and President (Principal Executive Officer) | March 3, 2015 | |||
Blake W. Krueger | |||||
/s/ Donald T. Grimes | Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer) | March 3, 2015 | |||
Donald T. Grimes | |||||
*/s/ Jeffrey M. Boromisa | Director | March 3, 2015 | |||
Jeffrey M. Boromisa | |||||
*/s/ Gina R. Boswell | Director | March 3, 2015 | |||
Gina R. Boswell | |||||
*/s/ Roxane Divol | Director | March 3, 2015 | |||
Roxane Divol | |||||
*/s/ William K. Gerber | Director | March 3, 2015 | |||
William K. Gerber | |||||
*/s/ Joseph R. Gromek | Director | March 3, 2015 | |||
Joseph R. Gromek | |||||
*/s/ David T. Kollat | Director | March 3, 2015 | |||
David T. Kollat | |||||
*/s/ Brenda J. Lauderback | Director | March 3, 2015 | |||
Brenda J. Lauderback | |||||
*/s/ Nicholas T. Long | Director | March 3, 2015 | |||
Nicholas T. Long | |||||
*/s/ Timothy J. O’Donovan | Director | March 3, 2015 | |||
Timothy J. O’Donovan | |||||
*/s/ Michael A. Volkema | Director | March 3, 2015 | |||
Michael A. Volkema | |||||
*By: | /s/ Blake W. Krueger | Attorney-in-Fact | March 3, 2015 | ||
Blake W. Krueger |
Column A | Column B | Column C | Column D | Column E | |||||||||||||||||
Additions | |||||||||||||||||||||
(In millions) | Balance at Beginning of Period | (1) Charged to Costs and Expenses | (2) Charged to Other Accounts (Describe) | Deductions (Describe) | Balance at End of Period | ||||||||||||||||
Fiscal year ended January 3, 2015 | |||||||||||||||||||||
Deducted from asset accounts: | |||||||||||||||||||||
Allowance for doubtful accounts | $ | 18.3 | $ | 34.9 | — | $ | 32.6 | (A) | $ | 20.6 | |||||||||||
Allowance for sales returns | 15.4 | 68.9 | — | 68.4 | (B) | 15.9 | |||||||||||||||
Allowance for cash discounts | 4.1 | 19.7 | — | 19.3 | (C) | 4.5 | |||||||||||||||
Inventory valuation allowances | 14.0 | 14.0 | — | 16.6 | (D) | 11.4 | |||||||||||||||
Total | $ | 51.8 | $ | 137.5 | — | $ | 136.9 | $ | 52.4 | ||||||||||||
Fiscal year ended December 28, 2013 | |||||||||||||||||||||
Deducted from asset accounts: | |||||||||||||||||||||
Allowance for doubtful accounts | $ | 10.1 | $ | 21.1 | — | $ | 12.9 | (A) | $ | 18.3 | |||||||||||
Allowance for sales returns | 11.4 | 74.6 | — | 70.6 | (B) | 15.4 | |||||||||||||||
Allowance for cash discounts | 5.2 | 19.2 | — | 20.3 | (C) | 4.1 | |||||||||||||||
Inventory valuation allowances | 12.5 | 11.3 | — | 9.8 | (D) | 14.0 | |||||||||||||||
Total | $ | 39.2 | $ | 126.2 | — | $ | 113.6 | $ | 51.8 | ||||||||||||
Fiscal year ended December 29, 2012 | |||||||||||||||||||||
Deducted from asset accounts: | |||||||||||||||||||||
Allowance for doubtful accounts | $ | 4.8 | $ | 8.7 | — | $ | 3.4 | (A) | $ | 10.1 | |||||||||||
Allowance for sales returns | 5.2 | 53.9 | — | 47.7 | (B) | 11.4 | |||||||||||||||
Allowance for cash discounts | 2.7 | 11.8 | — | 9.3 | (C) | 5.2 | |||||||||||||||
Inventory valuation allowances | 10.3 | 7.8 | — | 5.6 | (D) | 12.5 | |||||||||||||||
Total | $ | 23.0 | $ | 82.2 | — | $ | 66.0 | $ | 39.2 |
(A) | Accounts charged off, net of recoveries. |
(B) | Actual customer returns. |
(C) | Discounts given to customers. |
(D) | Adjustment upon disposal of related inventories. |
Exhibit Number | Document | |
2.1 | Agreement and Plan of Merger, dated as of May 1, 2012, by and among WBG-PSS Holdings LLC, WBG-PSS Merger Sub Inc., Collective Brands, Inc. and Wolverine World Wide, Inc. Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed on May 4, 2012. | |
3.1 | Restated Certificate of Incorporation. Incorporated by reference to Exhibit 3.1 to the Company’s current report on Form 8-K filed on October 11, 2013. | |
3.2 | Amended and Restated By-laws. Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on February 19, 2015. | |
4.1 | Senior Notes Indenture, dated October 9, 2012, among Wolverine World Wide, Inc., the guarantors named therein, and Wells Fargo Bank, National Association. Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on October 9, 2012. | |
4.2 | Form of 6.125% Senior Note due 2020. Incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on October 9, 2012. | |
4.3 | Registration Rights Agreement, dated October 9, 2012, among the Wolverine World Wide, Inc., the guarantors named therein and J.P. Morgan Securities LLC, as representative of the several initial purchasers. Incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K filed on October 9, 2012. | |
10.1 | Amended and Restated Stock Incentive Plan of 1999.* Incorporated by reference to Exhibit 10.4 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.2 | Amended and Restated Stock Incentive Plan of 2001.* Incorporated by reference to Exhibit 10.5 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.3 | Amended and Restated Stock Incentive Plan of 2003.* Incorporated by reference to Exhibit 10.6 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.4 | Amended and Restated Stock Incentive Plan of 2005.* Incorporated by reference to Exhibit 10.7 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.5 | Amended and Restated Directors’ Stock Option Plan.* Incorporated by reference to Exhibit 10.8 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.6 | Amended and Restated Outside Directors’ Deferred Compensation Plan.* Incorporated by reference to Exhibit 10.9 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2007. | |
10.7 | Amended and Restated Executive Short-Term Incentive Plan (Annual Bonus Plan).* Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on April 20, 2012. | |
10.8 | Amended and Restated Executive Long-Term Incentive Plan (3-Year Bonus Plan).* Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 20, 2012. | |
10.9 | Amended and Restated Stock Option Loan Program.* Incorporated by reference to Exhibit 10.12 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2007. | |
10.10 | Executive Severance Agreement.* Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on December 17, 2008. A participant schedule of current executive officers who are parties to this agreement is attached as Exhibit 10.10. | |
10.11 | Executive Severance Agreement.* Incorporated by reference to Exhibit 10.14 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011. A participant schedule of current executive officers who are parties to this agreement is attached as Exhibit 10.11 | |
10.12 | Form of Indemnification Agreement.* The Company has entered into an Indemnification Agreement with each director and executive officer. Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 25, 2007. | |
10.13 | Amended and Restated Benefit Trust Agreement dated April 25, 2007.* Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on April 25, 2007. | |
10.14 | Employees’ Pension Plan (Restated as amended through December 23, 2014).* | |
10.15 | Form of Incentive Stock Option Agreement.* Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 17, 2006. | |
10.16 | Form of Non-Qualified Stock Option Agreement.* Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on February 17, 2006. | |
10.17 | Form of Non-Qualified Stock Option Agreement.* Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on February 17, 2006. | |
10.18 | Form of Restricted Stock Agreement.* Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on February 17, 2006. |
Exhibit Number | Document | |
10.19 | Form of Restricted Stock Agreement.* Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 16, 2012. | |
10.20 | Form of Stock Option Agreement for non-employee directors.* Incorporated by reference to Exhibit 10.23 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 1, 2005. | |
10.21 | Form of Non-Qualified Stock Option Agreement.* Incorporated by reference to Exhibit 10.26 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.22 | Form of Non-Qualified Stock Option Agreement.* Incorporated by reference to Exhibit 10.27 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.23 | Form of Performance Share Award Agreement (2013 - 2015 performance period).* Incorporated by reference to Exhibit 10.2 to the Company's Form 10-Q for the fiscal quarter ended June 14, 2014. | |
10.24 | Form of Performance Share Award Agreement (2014 - 2016 performance period).* Incorporated by reference to Exhibit 10.3 to the Company’s Form 10-Q for the fiscal quarter ended June 14, 2014. | |
10.25 | Form of Performance Share Award Agreement (2015 - 2017 performance period).* | |
10.26 | Form of Performance Share Award Agreement (2015 performance period) for Blake W. Krueger.* | |
10.27 | Form of Performance Share Award Agreement (2015 - 2016 performance period) for Blake W. Krueger.* | |
10.28 | Separation Agreement between Wolverine World Wide, Inc. and Blake W. Krueger, dated as of March 13, 2008, as amended.* Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the period ended March 22, 2008. | |
10.29 | First Amendment to Separation Agreement between Wolverine World Wide, Inc. and Blake W. Krueger, dated as of December 11, 2008.* Incorporated by reference to Exhibit 10.30 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.30 | 409A Supplemental Executive Retirement Plan.* Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 17, 2008. A participant schedule of current executive officers who participate in this plan is attached as Exhibit 10.30. | |
10.31 | Form of 409A Supplemental Retirement Plan Participation Agreement with Blake W. Krueger.* Incorporated by reference to Exhibit 10.32 to the Company’s Annual Report on Form 10-K for the fiscal year ended January 3, 2009. | |
10.32 | Outside Directors’ Deferred Compensation Plan.* Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on December 17, 2008. | |
10.33 | Stock Incentive Plan of 2010.* Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-8 filed on March 4, 2010. | |
10.34 | Amended and Restated Stock Incentive Plan of 2013.* Incorporated by reference to Exhibit 10.38 to the Company’s Form 10-K for the fiscal year ended December 28, 2013. | |
10.35 | Limited Guarantee, dated as of May 1, 2012, entered into by Wolverine World Wide, Inc. in favor of Collective Brands, Inc. Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on May 4, 2012. | |
10.36 | Purchase Agreement, dated as of May 1, 2012, by and between Open Water Ventures, LLC and WBG-PSS Holdings LLC. Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on May 4, 2012. | |
10.37 | Interim Agreement, dated as of May 1, 2012, by and among Wolverine World Wide, Inc., WBG-PSS Holdings LLC, WBG-PSS Merger Sub Inc., Golden Gate Capital Opportunity Fund, L.P. and Blum Strategic Partners IV, L.P. Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on May 4, 2012. | |
10.38 | Separation Agreement, dated as of May 1, 2012, by and between Wolverine World Wide, Inc. and WBG-PSS Holdings LLC. Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on May 4, 2012. | |
10.39 | Amendment No. 1 to Separation Agreement, dated as of October 9, 2012, by and between the Company and WBG-PSS Holdings LLC. Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on October 9, 2012. | |
10.40 | Amendment No. 1 to Purchase Agreement, dated as of October 9, 2012, by and between Open Water Ventures, LLC and WBG-PSS Holdings LLC. Incorporated by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the period ended September 8, 2012. |
Exhibit Number | Document | |
10.41 | Credit Agreement, dated as of July 31, 2012, by and among Wolverine World Wide, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as a lender, J.P. Morgan Europe Limited, as foreign currency agent, Wells Fargo Bank, National Association, as syndication agent and as a lender, Fifth Third Bank as documentation agent and as a lender, and PNC Bank, National Association, as documentation agent and as a lender. Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 1, 2012. | |
10.42 | First Amendment to Credit Agreement, dated as of September 28, 2012, by and among Wolverine World Wide, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as a lender, J.P. Morgan Europe Limited, as foreign currency agent, Wells Fargo Bank, National Association, as syndication agent and as a lender, Fifth Third Bank as documentation agent and as a lender, and PNC Bank, National Association, as documentation agent and as a lender. Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 4, 2012. | |
10.43 | Second Amendment to the Credit Agreement, dated as of October 8, 2012, among Wolverine World Wide, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as a lender, J.P. Morgan Europe Limited, as foreign currency agent, Wells Fargo Bank, National Association, as syndication agent and as a lender, Fifth Third Bank, as documentation agent and as a lender, and PNC Bank, National Association, as documentation agent and as a lender. Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on October 9, 2012. | |
10.44 | Replacement Facility Amendment, dated as of October 10, 2013, to the Amended and Restated Credit Agreement among Wolverine World Wide, Inc., the lenders party thereto, and JPMorgan Chase Bank, N.A. as administrative agent. Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 11, 2013. | |
10.45 | Omnibus Amendment, dated as of December 19, 2014 to the Amended and Restated Credit Agreement dated as of October 10, 2013 among Wolverine World Wide, Inc., the lenders party thereto, Wells Fargo Bank, National Association, as syndication agent, Bank of America, N.A., Fifth Third Bank, PNC Bank, National Association, Sumitomo Mitsui Banking Corporation, Union Bank, N.A., And BBVA Compass Bank, as co-documentation agents, J.P. Morgan Europe Limited, as foreign currency agent, and JPMorgan Chase Bank, N.A., as administrative agent. | |
10.46 | Receivables Sales Agreement dated as of December 22, 2014, among Wolverine World Wide, Inc. and certain of its subsidiaries as sellers, and HSBC Bank USA, N.A. as purchaser. | |
21 | Subsidiaries of Registrant. | |
23 | Consent of Ernst & Young LLP. | |
24 | Powers of Attorney. | |
31.1 | Certification of Chairman, Chief Executive Officer and President under Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2 | Certification of Senior Vice President, Chief Financial Officer and Treasurer under Section 302 of the Sarbanes-Oxley Act of 2002. | |
32 | Certification pursuant to 18 U.S.C. § 1350. | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document | |
* | Management contract or compensatory plan or arrangement. |
Salary Multiplier | Change of Control | |||||
Rate | Termination Period | Continuation Period | ||||
(Section 4(a)(4)) | (Section 1(n)) | (Section 2) | ||||
Blake W. Krueger | 3 | 3 years | 36 months | |||
Ted S. Gedra | 2 | 2 years | 24 months | |||
Donald T. Grimes | 2 | 2 years | 24 months | |||
James D. Zwiers | 2 | 2 years | 24 months |
Salary Multiplier | Change of Control | |||||
Rate | Termination Period | Continuation Period | ||||
(Section 4(a)(4)) | (Section 1(n)) | (Section 2) | ||||
James A. Gabel | 2 | 2 years | 24 months | |||
Brendan M. Gibbons | 2 | 2 years | 24 months | |||
Melissa A. Howell | 2 | 2 years | 24 months | |||
Michael Jeppesen | 2 | 2 years | 24 months | |||
Andrew Simister | 2 | 2 years | 24 months |
Page | ||
ARTICLE 1 - Establishment of Plan and Trust | 1 | |
1.1 | Establishment of Plan | 1 |
(a) Employer | 1 | |
(b) Plan History | 1 | |
(c) Adoption by Affiliated Employer | 1 | |
(d) Administration | 1 | |
1.2 | Declaration of Trust | 2 |
1.3 | Compliance With Law | 2 |
1.4 | Effective Dates of Plan Provisions | 2 |
1.5 | Application to Inactive and Former Participants | 2 |
ARTICLE 2 - Definitions | 1 | |
Table of Definitions | x | |
2.1 | Break in Service | 1 |
2.2 | Employer Contributions | 1 |
2.3 | 5% Owner | 1 |
(a) Corporation | 1 | |
(b) Partnership | 1 | |
(c) Proprietorship | 1 | |
2.4 | Highly Compensated Employee | 2 |
(a) Definition | 2 | |
(b) Determination Rules | 2 | |
2.5 | Hour of Service | 3 |
(a) Definition | 3 | |
(b) Back Pay | 3 | |
(c) No Duties Performed | 3 | |
(d) Qualified Maternity or Paternity Absence | 3 | |
(e) Qualified Military Service | 4 | |
(f) No Duplication | 4 | |
(g) Non-Covered Employment | 4 | |
(h) Periods Credited | 4 | |
(i) Additional Hours | 5 | |
(j) Predecessor Plan | 5 | |
(k) Leased Employee | 5 | |
(l) Equivalency | 5 | |
2.6 | Person | 5 |
2.7 | Plan Year | 5 |
2.8 | Related Employer | 5 |
2.9 | Valuation Date | 5 |
ARTICLE 3 - Eligibility to Participate | 1 |
Page | ||
3.1 | Eligibility Requirements | 1 |
(a) Employee Definitions | 1 | |
(b) Entry Date | 1 | |
(c) Year of Eligibility Service | 1 | |
(d) Eligibility Period | 1 | |
(e) Breaks in Service | 1 | |
3.2 | Requirement of Covered Employment | 2 |
3.3 | Participation Rules | 2 |
(a) Termination of Participation | 2 | |
(b) Cancellation of Years of Eligibility Service | 2 | |
(c) Resumption of Participation | 2 | |
(d) No Resumption of Participation | 2 | |
3.4 | Leased Employee | 3 |
(a) Definition | 3 | |
(b) Exceptions | 3 | |
ARTICLE 4 - Contributions | 1 | |
4.1 | Contributions/Amount | 1 |
4.2 | Limits on Employer Contributions | 1 |
4.3 | Return of Employer Contributions | 1 |
(a) Mistake of Fact | 1 | |
(b) Nondeductible | 1 | |
(c) Amount | 1 | |
4.4 | Reduction of Contribution for Leased Employees | 2 |
4.5 | Timing of Contributions | 2 |
(a) Quarterly Payments | 2 | |
(b) Final Payment | 2 | |
ARTICLE 5 - Amount of Benefits | 1 | |
5.1 | Normal Retirement | 1 |
(a) Normal Retirement Date | 1 | |
(b) Normal Retirement Benefit | 1 | |
(c) Accrued Benefit | 1 | |
(d) Average Monthly Compensation | 3 | |
(e) Compensation | 4 | |
(f) Benefit Service | 5 | |
5.2 | Early Retirement | 5 |
(a) Early Retirement Date | 5 | |
(b) Early Retirement Benefit | 5 | |
(c) Early Payment | 6 | |
5.3 | Late Retirement | 6 |
(a) Late Retirement Date | 6 | |
(b) Late Retirement Benefit | 6 | |
5.4 | Deferred Vested Retirement | 7 |
(a) Deferred Vested Benefit | 7 | |
(b) Vested Accrued Benefit | 7 | |
(c) Early Payment | 7 | |
5.5 | Death Benefits | 7 |
Page | ||
(a) Death Before Vesting | 7 | |
(b) Death Before Annuity Starting Date | 7 | |
(c) Death After Annuity Starting Date | 8 | |
(d) Death While Performing Qualified Military Service | 8 | |
5.6 | Pension Offsets | 8 |
(a) Workers Compensation | 9 | |
(b) Disability Pension | 9 | |
5.7 | Special Benefit Schedules | 9 |
5.8 | Benefit Rules | 9 |
(a) Single Benefit | 9 | |
(b) Previously Paid Benefits | 9 | |
(c) Transfer | 9 | |
5.9 | Maximum Annual Benefits | 10 |
(a) Annual Benefit | 10 | |
(b) Defined Benefit Dollar Limit | 10 | |
(c) Compensation Limit | 10 | |
(d) Section 415 Compensation | 11 | |
(e) Limitation Year | 12 | |
(f) Aggregation | 12 | |
5.10 | Adjustments to Maximum Annual Benefits | 13 |
(a) Annual Benefit Actuarial Adjustment | 13 | |
(b) Adjustments to Defined Benefit Dollar Limit and Compensation Limit | 15 | |
(c) $10,000 Limitation | 16 | |
(d) Grandfathered Annual Benefit | 17 | |
(e) Cost of Living Adjustment | 17 | |
ARTICLE 6 - Determination of Vested Percentage | 1 | |
6.1 | Year of Vesting Service | 1 |
(a) Credit | 1 | |
(b) No Credit | 1 | |
6.2 | Vested Percentage | 1 |
(a) Vesting Schedule | 1 | |
(b) Normal Retirement Date | 1 | |
6.3 | Cashout | 1 |
6.4 | Five Breaks in Service | 2 |
(a) Cancellation of Vesting Service | 2 | |
(b) Forfeiture of Nonvested Accrued Benefit | 2 | |
6.5 | Death After Termination/Lost Recipient | 2 |
(a) Death After Termination | 2 | |
(b) Lost Recipient | 2 | |
ARTICLE 7 - Payment of Benefits | 1 | |
7.1 | Time of Payment | 1 |
(a) Normal Retirement Benefit | 1 | |
(b) Early Retirement Benefit | 1 | |
(c) Late Retirement Benefit | 1 | |
(d) Deferred Vested Benefit | 1 |
Page | ||
(e) Death Benefit | 1 | |
(f) Disability Benefit | 2 | |
(g) Immediate Benefit | 2 | |
(h) QDRO | 2 | |
(i) Plan Termination; Partial Termination | 3 | |
7.2 | Determination of Benefits | 3 |
(a) Lump Sum | 3 | |
(b) Optional Forms | 3 | |
7.3 | Form of Payment | 3 |
(a) Standard Form | 3 | |
(b) Optional Forms of Payment | 4 | |
(c) Direct Transfer | 5 | |
(d) Small Balance/Automatic Rollover to IRA | 6 | |
7.4 | Required Distribution Rules | 6 |
(a) Time of Distribution | 7 | |
(b) General Annuity Requirements | 8 | |
(c) Requirements For Annuity Distributions That Commence During Participant's Lifetime | 9 | |
(d) Requirements For Minimum Distributions Where Participant Dies Before Date Distributions Begin | 9 | |
(e) Definitions | 10 | |
(f) Actuarial Increase | 10 | |
(g) TEFRA Election | 11 | |
7.5 | Waiver of QJSA or QPSA; Election of Method and Time of Benefit Payments | 11 |
(a) Waiver of QJSA | 11 | |
(b) Waiver of QPSA | 12 | |
(c) Spousal Consent | 13 | |
(d) Permitted Elections | 13 | |
(e) Participant Consent | 13 | |
(f) Exceptions | 14 | |
(g) Election Requirements | 15 | |
(h) Failure to Elect | 15 | |
(i) Additional Information | 16 | |
(j) No Reduction or Delay of Payments | 16 | |
(k) No Retroactive Payment | 16 | |
7.6 | Determination of Beneficiary | 16 |
(a) Beneficiary | 16 | |
(b) Successor Beneficiaries | 16 | |
(c) Married Participant; Spousal Consent | 16 | |
(d) Default Determination | 17 | |
(e) Death of Beneficiary | 17 | |
(f) No Surviving Beneficiary | 18 | |
(g) Alternate Payee | 18 | |
(h) Determination | 18 |
Page | ||
7.7 | Facility of Payment | 18 |
(a) Minimum Payments | 18 | |
(b) Incapacity | 18 | |
(c) Legal Representative | 18 | |
(d) Annuity Contract Purchase | 18 | |
7.8 | Penalties | 19 |
(a) Payment Before Age 59 1/2 | 19 | |
(b) Failure to Receive Minimum Payments | 19 | |
7.9 | Suspension of Benefit Payments | 19 |
(a) Normal/Early Retirement Benefits | 19 | |
(b) Disability | 20 | |
ARTICLE 8 - Administration of the Plan | 1 | |
8.1 | Duties, Powers, and Responsibilities of the Employer | 1 |
(a) Required | 1 | |
(b) Discretionary | 1 | |
8.2 | Employer Action | 2 |
8.3 | Plan Administrator | 2 |
8.4 | Administrative Committee | 2 |
(a) Appointment | 2 | |
(b) Agent; Powers and Duties | 2 | |
(c) Not Fiduciary | 3 | |
(d) Membership | 3 | |
(e) Records | 3 | |
(f) Actions | 3 | |
(g) Report to Administrator | 3 | |
(h) Compensation | 3 | |
(i) Conflict of Interest | 3 | |
8.5 | Duties, Powers, and Responsibilities of the Administrator | 3 |
(a) Plan Interpretation | 3 | |
(b) Participant Rights | 3 | |
(c) Limits; Tests | 4 | |
(d) Benefits and Vesting | 4 | |
(e) Errors | 4 | |
(f) Claims and Elections | 4 | |
(g) Benefit Payments | 4 | |
(h) QDRO Determination | 4 | |
(i) Administration Information | 4 | |
(j) Recordkeeping | 4 | |
(k) Reporting and Disclosure | 4 | |
(l) Penalties; Excise Taxes | 4 | |
(m) Advisers | 4 | |
(n) Expenses, Fees, and Charges | 5 | |
(o) Nondiscrimination | 5 | |
(p) Bonding | 5 | |
(q) Other Powers and Duties | 5 | |
8.6 | Delegation of Administrative Duties | 5 |
Page | ||
(a) In Writing | 5 | |
(b) Acceptance of Responsibility | 5 | |
(c) Conflict | 5 | |
8.7 | Interrelationship of Fiduciaries; Discretionary Authority | 5 |
(a) Performance of Duties | 5 | |
(b) Reliance on Others | 6 | |
(c) Discretionary Authority of Fiduciaries | 6 | |
8.8 | Compensation; Indemnification | 6 |
8.9 | Fiduciary Standards | 6 |
(a) Prudence | 6 | |
(b) Exclusive Purpose | 6 | |
(c) Prohibited Transaction | 6 | |
8.10 | Benefit Applications; Appeal Procedures | 7 |
(a) Application for Benefits | 7 | |
(b) Notification of Adverse Determination for Application | 7 | |
(c) Appeal | 7 | |
(d) Final Decision | 7 | |
(e) Notification of Adverse Determination on Appeal | 7 | |
(f) Disability Claims | 7 | |
(g) Extensions | 8 | |
(h) Full and Fair Review | 8 | |
(i) Authorized Representative; Hearings | 8 | |
8.11 | Participant's Responsibilities | 8 |
8.12 | Electronic Administration | 8 |
ARTICLE 9 - Investment of Funds | 1 | |
9.1 | Investment Responsibility | 1 |
9.2 | Authorized Investments | 1 |
(a) Specific Investments | 1 | |
(b) Right of Trustee To Hold Cash | 2 | |
9.3 | Commingled Investment | 2 |
ARTICLE 10 - Administration of the Trust | 1 | |
10.1 | Duties and Powers of the Trustee | 1 |
(a) Duties of the Trustee | 1 | |
(b) Powers of the Trustee | 1 | |
(c) Limitation on Duties and Powers of the Trustee | 3 | |
10.2 | Accounting | 4 |
(a) Report | 4 | |
(b) Judicial Settlement | 4 | |
10.3 | Appointment, Resignation, and Removal of Trustee | 4 |
(a) Resignation | 4 | |
(b) Removal | 4 | |
(c) Successor Trustee | 4 | |
(d) Effective Date of Resignation or Removal | 4 | |
(e) Procedure Upon Transfer | 4 | |
(f) Earlier Transfer | 5 | |
(g) Final Transfer | 5 |
Page | ||
(h) In Kind Transfer | 5 | |
(i) Limitation on Liability of Successor | 5 | |
10.4 | Trustee Action | 5 |
10.5 | Exculpation of Nonfiduciary | 5 |
ARTICLE 11 - Amendment, Mergers, Successor Employer | 1 | |
11.1 | Amendment | 1 |
(a) Prohibitions | 1 | |
(b) Notice | 1 | |
11.2 | Amendment by WN&J | 2 |
(a) Authorized Amendments | 2 | |
(b) Termination of Authority | 2 | |
(c) Authority Conditioned on Favorable Determination Letter | 2 | |
11.3 | Merger of Plans | 2 |
(a) Preservation of Accrued Benefits | 2 | |
(b) Actuarial Statement | 2 | |
(c) Authorization | 2 | |
11.4 | Successor Employer | 3 |
ARTICLE 12 - Termination | 1 | |
12.1 | Right to Terminate | 1 |
(a) Employer | 1 | |
(b) Pension Benefit Guaranty Corporation | 1 | |
12.2 | Automatic Termination | 1 |
12.3 | Termination or Partial Termination of Plan | 2 |
(a) Termination | 2 | |
(b) Partial Termination | 2 | |
(c) Priorities | 2 | |
(d) Rules For Application | 3 | |
12.4 | Effect of Termination or Partial Termination | 4 |
(a) Nonforfeitability | 4 | |
(b) Distribution | 4 | |
(c) Recourse Only Against Trust Assets | 4 | |
12.5 | Reversion of Assets | 4 |
12.6 | Highest Paid Restriction | 4 |
(a) Restrictions on Termination | 4 | |
(b) Restrictions on Distributions | 4 | |
(c) Payment of Restricted Benefit in Full | 5 | |
(d) Payments Prior to January 1, 1994 | 6 | |
12.7 | Special Restriction | 6 |
(a) Restricted Date | 6 | |
(b) Change in Control | 6 | |
(c) Unrestricted Date | 7 | |
(d) Termination/Partial Termination | 7 | |
(e) Merger Consolidation | 7 | |
(f) Amendment | 8 | |
ARTICLE 13 - General Provisions | 1 |
Page | ||
13.1 | Spendthrift Provision | 1 |
(a) Not Security | 1 | |
(b) Crimes and ERISA Violations | 1 | |
(c) Attempts Void | 2 | |
13.2 | Effect Upon Employment Relationship | 2 |
13.3 | No Interest in Employer Assets | 2 |
13.4 | Construction | 2 |
13.5 | Severability | 3 |
13.6 | Governing Law | 3 |
13.7 | Nondiversion | 3 |
13.8 | Limitations for Underfunded Plans | 3 |
(a) Limitation on Benefit Accruals | 3 | |
(b) Limitation on Benefit Payments | 4 | |
(c) Limitation on Unpredictable Contingent Event Benefits | 5 | |
(d) Limitation on Plan Amendments | 6 | |
(e) Automatic Resumption/Restoration | 6 | |
(f) Definitions | 7 | |
ARTICLE 14 - Top-Heavy Plan Provisions | 1 | |
14.1 | Top-Heavy Plan | 1 |
(a) Not Required or Permissive Aggregation Group | 1 | |
(b) Required Aggregation Group | 1 | |
(c) Permissive Aggregation Group | 1 | |
14.2 | Top-Heavy Determination | 1 |
(a) Top-Heavy Ratio | 1 | |
(b) Present Value of Accrued Benefits | 3 | |
(c) Required Aggregation Group | 4 | |
(d) Permissive Aggregation Group | 4 | |
(e) Determination Date | 4 | |
(f) Key Employee | 4 | |
(g) Top-Heavy Valuation Date | 5 | |
14.3 | Minimum Benefits | 5 |
(a) Minimum Accrued Benefit | 5 | |
(b) Minimum Average Monthly Compensation | 5 | |
14.4 | Vesting Schedule | 6 |
(a) Cessation | 6 | |
(b) Vesting Schedule Change | 6 |
Term | Location |
Accrued Benefit | 5.1(c) |
Actuaries | 8.5(m) |
Administrator | 8.3 |
Annual Benefit | 5.9(a) |
Annual Compensation Limit | 5.1(e)(ii) |
Annuity Starting Date | 7.5(e)(ii) |
Average Monthly Compensation | 5.1(d) |
Beneficiary | 7.6(a) |
Benefit Commitments | 12.1(b)(iii) |
Break in Service | 2.1 |
Code | 1.3 |
Compensation | 5.1(e) |
Compensation Limit | 5.9(c) |
Covered Employment | 3.2 |
Deferred Vested Benefit | 5.4(a) |
Defined Benefit Dollar Limit | 5.9(b) |
Determination Date | 14.2(e) |
Early Retirement Benefit | 5.2(b) |
Early Retirement Date | 5.2(a) |
Effective Date | 1.4 |
Eligibility Period | 3.1(d) |
Elective Deferrals | 5.11(e)(i) |
Employee | 3.1(a) |
Employer | 1.1(a) |
Employer Contributions | 2.2 |
Entry Date | 3.1(b) |
ERISA | 1.3 |
5% Owner | 2.3 |
417(e) Interest Rate | 7.2(a)(i) |
417(e) Mortality Table | 7.2(a)(ii) |
Highly Compensated Employee | 2.4(a) |
Hour of Service | 2.5(a) |
Investment Manager | 8.1(b)(i)(B) |
Key Employee | 14.2(f) |
Late Retirement Benefit | 5.3(b) |
Term | Location |
Late Retirement Date | 5.3(a) |
Leased Employee | 3.4(a) |
Limitation Year | 5.8(e) |
Look-Back Year | 2.4(b)(i) |
Minimum Accrued Benefit | 14.3(a) |
Minimum Average Monthly Compensation | 14.3(b) |
Normal Retirement Benefit | 5.1(b) |
Normal Retirement Date | 5.1(a) |
Participant | 3.1 |
PBGC | 12.1(b) |
Permissive Aggregation Group | 14.2(d) |
Person | 2.6 |
Plan Year | 2.7 |
Present Value of Accrued Benefits | 14.2(b)(i) |
QDRO | 7.1(h) |
QJSA | 7.3(a)(i)(A) |
QPSA | 5.5(b)(i)(C) |
Qualified Maternity or | |
Paternity Absence | 2.5(d)(i) |
Qualified Military Service | 2.5(e)(i) |
Regulations | 1.3 |
Related Employer | 2.8 |
Required Aggregation Group | 14.2(c) |
Required Beginning Date | 7.4(a)(i) |
Section 415 Compensation | 5.9(d) |
Single Life Annuity | 7.3(b)(i) |
Spouse | 5.5(b)(i)(A) |
Surviving Spouse | 5.5(b)(i)(B) |
Top-Heavy Plan | 14.1 |
Top-Heavy Ratio | 14.2(a) |
Top-Heavy Valuation Date | 14.2(g) |
Trustee | 1.2 |
USERRA | 2.5(e)(ii) |
Valuation Date | 2.9 |
Vested Accrued Benefit | 5.4(b) |
Vesting Period | 6.1 |
Year of Benefit Service | 5.1(f) |
Year of Eligibility Service | 3.1(c) |
Year of Vesting Service | 6.1 |
Percentage Reduction | ||
1.6% or Dollar Formula | .3333 (1/3 of 1%) | |
Social Security Allowance First 60 months | .5555 (5/9% per month) | |
Preceding Social Security Retirement Age | ||
Social Security Allowance Next 60 months | .2777 (5/18% per month) | |
Preceding Social Security Retirement Age |
Years of Vesting Service | Vested Percentage | |
Less than 5 years | -0- | |
5 years or more | 100% |
7.5 | Waiver of QJSA or QPSA; Election of Method and Time of Benefit Payments. |
8.1 | Duties, Powers, and Responsibilities of the Employer. |
Years of Vesting Service | Vested Percentage | |
Less than 2 years | -0- | |
2 years | 20% | |
3 years | 40% | |
4 years | 60% | |
5 years | 100% |
Hush Puppies Retail, Inc. | 06-0861235 | |
Sebago USA, LLC | 32-0093054 | |
Wolverine Outdoors, Inc. | 38-3375022 | |
Wolverine Procurement, Inc. | 38-2889988 | |
Wolverine Slipper Group, Inc. | 38-3442561 | |
Wolverine World Wide, Inc. | 38-1185150 | |
Wolverine Worldwide Leathers, Inc. | 30-0655945 |
EFFECTIVE DATE | |||
UNIT | UNDER PLAN | ||
Tru-Stitch Footwear Division - | 01-01-70 | ||
Salaried D | |||
Frolic Footwear Division - | 02-01-70 | ||
Salaried | |||
Hush Puppies Retail, Inc. - | 01-01-77 | ||
Division 5 | |||
Town & Country Shoes, Inc. | 06-01-81 | ||
Brooks Shoe Company, Inc. | 01-01-82 | ||
Viner Bros., Inc. | 04-01-84 | ||
Tru-Stitch Footwear Division - | 01-01-85 | ||
Hourly - Non Union | |||
Wolverine Hy-Test, Inc. | 04-17-96 | ||
non-collectively bargained employees |
Retirement Date (Normal/Deferred Benefit), | ||
Date of Disability (Disability Retirement | ||
Benefit) or Termination of Employment Date | Dollar Benefit | |
(Early Retirement/Monthly Deferred | Multiplier | |
January 1, 1976 - December 31, 1978 | $4 (pre-1/1/76 | |
Service)/ $6 | ||
(post-12/31/75 | ||
Service) | ||
January 1, 1979 - December 31, 1983 | $6.00 | |
January 1, 1984 - December 31, 1975 | $7.00 | |
January 1, 1986 - December 31, 1988 | $8.00 | |
January 1, 1989 - December 31, 1989 | $8.50 | |
January 1, 1990 - December 31, 1991 | $9.00 | |
January 1, 1992 - December 31, 1992 | $11.00 | |
January 1, 1993 - December 31, 1993 | $12.00 | |
January 1, 1994 - December 31, 1994 | $14.00 | |
January 1, 1995 - December 31, 1995 | $15.00 | |
January 1, 1996 - December 31, 1997 | $16.00 | |
January 1, 1998 - December 31, 1998 | $18.00 | |
January 1, 1999 - December 31, 1999 | $20.00 | |
January 1, 2000 - December 31, 2000 | $21.00 | |
January 1, 2001 – December 31, 2001 | $23.00 | |
January 1, 2002 or after | $24.00 |
Health Care Plan Status | Lump Sum Amount | |
(as of July 12, 2000) | ||
Employee Only | $1,576.08 | |
Employee & Child | $3,050.22 | |
Employee & Spouse | $3,874.92 | |
Employee & Family | $4,932.42 |
Age | Percentage Increase | |
(as of July 12, 2000) | in Benefit | |
60 but less than 61 | 2% | |
61 but less than 62 | 4% | |
62 but less than 63 | 6% | |
63 but less than 64 | 8% | |
64 or more | 10% |
Retirement Date | Benefit Rate | |
On or after January 1, 1996 | $10.25 | |
On or after January 1, 1997 | $10.75 | |
On or after January 1, 1998 | $11.00 | |
On or after March 1, 1999 | $12.00 | |
On or after January 1, 2000 | $13.00 |
Hours of Service | Percentage of | |
in Covered Employment | Year of Service | |
0 - 199 | 0 | |
200 - 499 | 25% | |
500 - 799 | 50% | |
800 - 999 | 75% | |
1,000 or more | 100% |
Adopted | Effective | |||||
D.1 | Original Adoption. | January 1, 1969 | ||||
D.2 | Gust Restatement. | September 25, 2003 | January 1, 1997 | |||
(a) | First Amendment. | September 25, 2003 | January 1, 2002 | |||
(b) | Second Amendment. | December 19, 2003 | July 1, 2004 | |||
(c) | Third Amendment. | July 7, 2004 | July 1, 2004 | |||
(d) | Fourth Amendment. | _______ __, 2004 | January 1, 1997 | |||
(e) | Fifth Amendment. | September 26, 2005 | March 28, 2005 | |||
(f) | Implementing Amendment. | June 30, 2006 | June 30, 2006 | |||
(g) | Sixth Amendment. | November 30, 2007 | January 1, 2003 | |||
(h) | Seventh Amendment. | November 30, 2007 | January 1, 2000/ | |||
January 1, 2008 | ||||||
(i) | Eighth Amendment. | June 16, 2008 | January 1, 2008 | |||
(j) | Ninth Amendment. | January 19, 2009 | January 20, 2009 | |||
(k) | Tenth Amendment. | December 3, 2009 | January 1, 2007 | |||
(l) | Eleventh Amendment. | November 29, 2011 | January 1, 2007/ | |||
December 31, 2008 | ||||||
D.3 | EGTRRA Restatement. | March 12, 2012 | January 1, 2011 | |||
(a) | First Amendment. | September 1, 2012 | September 1, 2012 | |||
(b) | Second Amendment. | December 28, 2012 | January 1, 2013 | |||
(c) | Third Amendment. | December 23, 2014 | December 23, 2014 |
Performance Share Agreement # |
4. | Registration and Listing; Securities Laws. |
Applicable Earnings | The Earnings amount used to calculate the Performance Share Award for the Award Recipient. |
Award Cap | The maximum percentage of the Incentive Award that the Award Recipient may receive for the Performance Period upon achievement of “stretch” goal, used to calculate the Performance Share Award for the Award Recipient. |
Award Recipient | An employee of the Company to whom the Compensation Committee of the Board of Directors or the Board of Directors grants a Performance Share Award, for such portion of the Performance Period as the Committee determines. |
BVA | An economic value added measurement that equals the operating income for a Fiscal Year reduced by (i) a provision for income taxes equal to the operating income multiplied by the Company’s total effective tax rate for the same Fiscal Year; and (ii) a capital charge equal to a 14-point average of “net operating assets” at the beginning and end of a Fiscal Year (with “net operating assets” defined as the net of trade receivables (net of reserves), inventory (net of reserves), other current assets, property, plant and equipment, trade payables and accrued liabilities) multiplied by 10%, as adjusted by resolution of the Compensation Committee. |
Cumulative BVA | The sum of the BVA for each of the Fiscal Years in the Performance Period. |
Cumulative EPS | The sum of the EPS for each of the Fiscal Years in the Performance Period. |
Earnings | An Award Recipient’s base salary as of the end of the Performance Period. |
EPS | The total after-tax profits for a Fiscal Year divided by the fully-diluted weighted average shares outstanding during the Fiscal Year, as adjusted by resolution of the Compensation Committee. |
Fiscal Year | The fiscal year of the Company for financial reporting purposes as the Company may adopt from time to time. |
Incentive Award Percentage | The Incentive Award Percentage used to calculate the Performance Share Award for the Award Recipient. |
Market Price | The closing market price of shares of Common Stock reported on the New York Stock Exchange (or any successor exchange that is the primary stock exchange for trading of Common Stock) on the date the award is granted by the Compensation Committee. |
Stock Restrictions | Restrictions on the common stock covered by the Performance Share Award, as set forth in the Plan and the Performance Share Award Agreement. |
Performance Period | The three year period beginning on the first day of the Company’s 2015 Fiscal Year and ending on the last day of the Company’s 2017 Fiscal Year. |
BVA Factor | As set by the Compensation Committee. |
Threshold BVA | As set by the Compensation Committee. |
Target BVA | As set by the Compensation Committee. |
Goal BVA | As set by the Compensation Committee. |
Stretch BVA | As set by the Compensation Committee. |
EPS Factor | As set by the Compensation Committee. |
Threshold EPS | As set by the Compensation Committee. |
Target EPS | As set by the Compensation Committee. |
Goal EPS | As set by the Compensation Committee. |
Stretch EPS | As set by the Compensation Committee. |
Performance Share Agreement # |
4. | Registration and Listing; Securities Laws. |
Applicable Earnings | The Earnings amount used to calculate the Performance Share Award for the Award Recipient. |
Award Cap | The maximum percentage of the Incentive Award that the Award Recipient may receive for the Performance Period upon achievement of “stretch” goal, used to calculate the Performance Share Award for the Award Recipient. |
Award Recipient | An employee of the Company to whom the Compensation Committee of the Board of Directors or the Board of Directors grants a Performance Share Award, for such portion of the Performance Period as the Committee determines. |
BVA | An economic value added measurement that equals the operating income for a Fiscal Year reduced by (i) a provision for income taxes equal to the operating income multiplied by the Company’s total effective tax rate for the same Fiscal Year; and (ii) a capital charge equal to a 14-point average of “net operating assets” at the beginning and end of a Fiscal Year (with “net operating assets” defined as the net of trade receivables (net of reserves), inventory (net of reserves), other current assets, property, plant and equipment, trade payables and accrued liabilities) multiplied by 10%, as adjusted by resolution of the Compensation Committee. |
Cumulative BVA | The sum of the BVA for each of the Fiscal Years in the Performance Period. |
Cumulative EPS | The sum of the EPS for each of the Fiscal Years in the Performance Period. |
Earnings | An Award Recipient’s base salary as of the end of the Performance Period. |
EPS | The total after-tax profits for a Fiscal Year divided by the fully-diluted weighted average shares outstanding during the Fiscal Year, as adjusted by resolution of the Compensation Committee. |
Fiscal Year | The fiscal year of the Company for financial reporting purposes as the Company may adopt from time to time. |
Incentive Award Percentage | The Incentive Award Percentage used to calculate the Performance Share Award for the Award Recipient. |
Market Price | The closing market price of shares of Common Stock reported on the New York Stock Exchange (or any successor exchange that is the primary stock exchange for trading of Common Stock) on February 6, 2013. |
Stock Restrictions | Restrictions on the common stock covered by the Performance Share Award, as set forth in the Plan and the Performance Share Award Agreement. |
Performance Period | The Company’s 2015 Fiscal Year. |
Revenue Threshold | As set by the Compensation Committee. |
BVA Factor | As set by the Compensation Committee. |
Threshold BVA | As set by the Compensation Committee. |
Target BVA | As set by the Compensation Committee. |
Goal BVA | As set by the Compensation Committee. |
Stretch BVA | As set by the Compensation Committee. |
EPS Factor | As set by the Compensation Committee. |
Threshold EPS | As set by the Compensation Committee. |
Target EPS | As set by the Compensation Committee. |
Goal EPS | As set by the Compensation Committee. |
Stretch EPS | As set by the Compensation Committee. |
Performance Share Agreement # |
4. | Registration and Listing; Securities Laws. |
Applicable Earnings | The Earnings amount used to calculate the Performance Share Award for the Award Recipient. |
Award Cap | The maximum percentage of the Incentive Award that the Award Recipient may receive for the Performance Period upon achievement of “stretch” goal, used to calculate the Performance Share Award for the Award Recipient. |
Award Recipient | An employee of the Company to whom the Compensation Committee of the Board of Directors or the Board of Directors grants a Performance Share Award, for such portion of the Performance Period as the Committee determines. |
BVA | An economic value added measurement that equals the operating income for a Fiscal Year reduced by (i) a provision for income taxes equal to the operating income multiplied by the Company’s total effective tax rate for the same Fiscal Year; and (ii) a capital charge equal to a 14-point average of “net operating assets” at the beginning and end of a Fiscal Year (with “net operating assets” defined as the net of trade receivables (net of reserves), inventory (net of reserves), other current assets, property, plant and equipment, trade payables and accrued liabilities) multiplied by 10%, as adjusted by resolution of the Compensation Committee. |
Cumulative BVA | The sum of the BVA for each of the Fiscal Years in the Performance Period. |
Cumulative EPS | The sum of the EPS for each of the Fiscal Years in the Performance Period. |
Earnings | An Award Recipient’s base salary as of the end of the Performance Period. |
EPS | The total after-tax profits for a Fiscal Year divided by the fully-diluted weighted average shares outstanding during the Fiscal Year, as adjusted by resolution of the Compensation Committee. |
Fiscal Year | The fiscal year of the Company for financial reporting purposes as the Company may adopt from time to time. |
Incentive Award Percentage | The Incentive Award Percentage used to calculate the Performance Share Award for the Award Recipient. |
Market Price | The closing market price of shares of Common Stock reported on the New York Stock Exchange (or any successor exchange that is the primary stock exchange for trading of Common Stock) on February 11, 2014. |
Stock Restrictions | Restrictions on the common stock covered by the Performance Share Award, as set forth in the Plan and the Performance Share Award Agreement. |
Performance Period | The two-year period beginning on the first day of the Company’s 2015 Fiscal Year and ending on the last day of the Company’s 2016 Fiscal Year. |
Revenue Threshold | As set by the Compensation Committee. |
BVA Factor | As set by the Compensation Committee. |
Threshold BVA | As set by the Compensation Committee. |
Target BVA | As set by the Compensation Committee. |
Goal BVA | As set by the Compensation Committee. |
Stretch BVA | As set by the Compensation Committee. |
EPS Factor | As set by the Compensation Committee. |
Threshold EPS | As set by the Compensation Committee. |
Target EPS | As set by the Compensation Committee. |
Goal EPS | As set by the Compensation Committee. |
Stretch EPS | As set by the Compensation Committee. |
2.4% | 2.0% |
Blake W. Krueger | Ted S. Gedra Donald T. Grimes |
Michael Jeppesen | |
James D. Zwiers |
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | SVP, CFO & Treasurer | |
WOLVERINE OUTDOORS, INC. | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
HUSH PUPPIES RETAIL, INC. | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
OPEN WATER VENTURES, LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
THE STRIDE RITE CORPORATION | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
WOLVERINE DISTRIBUTION, INC. | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer |
SAUCONY, INC. | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
SPERRY TOP-SIDER, LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
KEDS, LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
STRIDE RITE CHILDREN’S GROUP, LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
STRIDE RITE INVESTMENT CORPORATION | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
SR HOLDINGS, LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer |
SAUCONY IP HOLDINGS LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer | |
SRL, LLC | ||
By: | /s/ Donald T. Grimes | |
Name: | Donald T. Grimes | |
Title: | VP & Treasurer |
JPMORGAN CHASE BANK, N.A., as Administrative Agent | |
By: | /s/ Krys Szremski |
Name: Krys Szremski Title: Vice President | |
Wells Fargo Bank, N.A. | , | |
as a Lender | ||
By: | /s/ Charles W. Lott | |
Name: Charles W. Lott Title: SVP | ||
Fifth Third Bank | , | |
as a Lender | ||
By: | /s/ Yael Eisenberg | |
Name: Yael Eisenberg Title: Asst. Vice President | ||
PNC BANK, NATIONAL ASSOCIATION | , | |
as a Lender | ||
By: | /s/ Arthur F. Gray | |
Name: Arthur F. Gray Title: Senior Vice President | ||
BANK OF AMERICA N.A. | , | |
as a Lender | ||
By: | /s/ Jennifer E. Brown | |
Name: Jennifer E. Brown Title: Vice President | ||
Sumitomo Mitsui Banking Corporation | , | |
as a Lender | ||
By: | /s/ David W. Kee | |
Name: David W. Kee Title: Managing Director | ||
MUFG Union Bank N.A., f/k/a Union Bank N.A. | , | |
as a Lender | ||
By: | /s/ Michael Gardner | |
Name: Michael Gardner Title: Director | ||
COMPASS BANK | , | |
as a Lender | ||
By: | /s/ Debbie Sowards | |
Name: Debbie Sowards Title: Sr. Vice President | ||
BRANCH BANKING & TRUST COMPANY | , | |
as a Lender | ||
By: | /s/ Brian J. Blomeke | |
Name: Brian J. Blomeke Title: Senior Vice President | ||
Citizens Bank, N.A. as successor to RBS Citizens N.A. | , | |
as a Lender | ||
By: | /s/ M. James Barry | |
Name: M. James Barry Title: Sr. Vice President | ||
HSBC Bank USA, N.A. | , | |
as a Lender | ||
By: | /s/ Andrew Bicker | |
Name: Andrew Bicker Title: Senior Vice President | ||
KeyBank National Association | , | |
as a Lender | ||
By: | /s/ Marianne T. Meil | |
Name: Marianne T. Meil Title: Senior Vice President | ||
THE HUNTINGTON NATIONAL BANK | , | |
as a Lender | ||
By: | /s/ Michael Kiss | |
Name: Michael Kiss Title: Vice President | ||
Regions Bank | , | |
as a Lender | ||
By: | /s/ Darius Sutrinaitis | |
Name: Darius Sutrinaitis Title: Vice President | ||
THE NORTHERN TRUST COMPANY | , | |
as a Lender | ||
By: | /s/ Wicks Barkhausen | |
Name: Wicks Barkhausen Title: Second Vice President | ||
The Private Bank & Trust Co. | , | |
as a Lender | ||
By: | /s/ Mark D. Debniak | |
Name: Mark D. Debniak Title: Managing Director | ||
HSBC Bank Plc. | , | |
as a Lender | ||
By: | /s/ Ian Sparkes | |
Name: Ian Sparkes Title: Relationship Director | ||
RAYMOND JAMES BANK, N.A. | , | |
as a Lender | ||
By: | /s/ Scott G. Axelrod | |
Name: Scott G. Axelrod Title: Vice President | ||
AZB FUNDING 2 | , | |
as a Lender | ||
By: | /s/ Hiroshi Matsumoto | |
Name: Hiroshi Matsumoto Title: Deputy General Manager | ||
Flagstar Bank, FSB | , | |
as a Lender | ||
By: | /s/ Kelly M. Hamrick | |
Name: Kelly M. Hamrick Title: First Vice President | ||
Israel Discount Bank of New York | , | |
as a Lender | ||
By: | /s/ Susan L. Callahan | |
Name: Susan L. Callahan Title: Vice President |
/s/ Howard Weinberg |
Name: Howard Weinberg Title: First Senior Vice President |
Mizuho Bank, Ltd. | , | |
as a Lender | ||
By: | /s/ James Fayen | |
Name: James Fayen Title: Deputy General Manager | ||
TriState Capital Bank | , | |
as a Lender | ||
By: | /s/ Anne M. Westbrook | |
Name: Anne M. Westbrook Title: Senior Vice President | ||
A. | Wolverine, Administrative Agent and the lenders from time to time party thereto (the “Lenders”) have entered into a Credit Agreement dated as of July 31, 2012 (as amended and in effect from time to time, the “Credit Agreement”), pursuant to which the Lenders have made available to Wolverine a term loan facility and a revolving credit facility. |
B. | Administrative Agent, for the benefit of itself, the Lenders and various other secured parties (collectively, the “Creditors”), has received, in connection therewith, a security interest in certain property of Wolverine and other Debtors, including accounts receivable owed to the Debtors. |
C. | Pursuant to that certain Receivables Purchase Agreement dated as of December 22, 2014 (as amended, restated, supplemented or otherwise modified from time to time, the “PA”), by and between the Debtors and Purchaser, the Debtors will from time to time sell the “Purchased Receivables” (as used in this Agreement, such term is given the meaning assigned thereto in the PA). Each such sale under the PA, a “Sale” and collectively the “Sales”. |
D. | It is the desire and intention of the parties hereto to reflect the release of the security interest of the Creditors in (a) the Collection Account (as defined in the PA) and (b) Purchased Receivables upon the Sale thereof. |
1. | The Debtors hereby (a) certify as of each date a Sale is consummated, that such Sale is permitted under Section 7.5 of the Credit Agreement and (b) hereby request, in order to consummate each such Sale, that Administrative Agent agree that, with respect to any Purchased Receivables, the security interests of the Creditors in such Purchased Receivables are released automatically and without further action by Administrative Agent upon consummation of the Sale thereof. |
2. | Effective upon the consummation of any Sale, Administrative Agent agrees that the security interest of the Creditors in the Purchased Receivables subject to such Sale is hereby released automatically and without further action by Administrative Agent. The Administrative Agent agrees to take any action requested by the Loan Parties having the effect of releasing the security interest of the Creditors in the Purchased Receivables subject to such Sale or further evidencing such release to the extent necessary to permit consummation of such Sale. Administrative Agent further releases any security interest of the Creditors in the Collection Account as of the date hereof, and agrees to take any action requested by the Loan Parties evidencing such release. |
3. | The Purchaser hereby acknowledges and agrees to act as trustee on behalf of the Administrative Agent and hold in trust for the benefit of the Administrative Agent any amounts that may come into its possession that derive from accounts receivable owed to Debtors other than Purchased Receivables. Upon written notice from Administrative Agent or Wolverine, Purchaser agrees to as promptly as practicable turn or pay over to Administrative Agent (pursuant to wire instructions set forth in such notice) any amounts that may come into its possession that derive from accounts receivable owed to Debtors other than Purchased Receivables. The Administrative Agent hereby acknowledges and agrees to act as trustee on behalf of the Purchaser and hold in trust for the benefit of the Purchaser any amount that may come into its possession that derive from Purchased Receivables. Upon written notice from Purchaser or Wolverine, Administrative Agent agrees to as promptly as practicable turn or pay over to Purchaser (pursuant to wire instructions set forth in such notice) any amounts that may come into its possession that derive from Purchased Receivables. Except as set forth above, neither party shall have any other duty or obligation to the other of any other nature, including with respect to the attachment or creation of any other party’s security interest or any credit decisions of such other party with respect to the Debtors. Administrative Agent acknowledges that Purchaser and the Debtors have or may have business relationships in addition to the purchase and sale of the Purchased Receivables. |
4. | This Agreement shall remain in effect until the Agreement Termination Date, as defined in the PA (including during a bankruptcy proceeding involving Debtors); provided that this Agreement shall terminate immediately upon the termination of the Credit Agreement and release by Administrative Agent of its liens on the Collateral (as defined in the Credit Agreement) (subject to reinstatement to the extent the debt under the Credit Agreement and liens securing such debt are reinstated as the result of any bankruptcy proceeding). This Agreement will be binding upon and inure to the benefit of Administrative Agent and Purchaser and their respective successors and assigns. |
5. | Wolverine hereby agrees that it will not enter into any amendment, restatement, supplement or other modification of the PA that is adverse to any Creditor without the prior written consent of the Administrative Agent. Wolverine hereby agrees to promptly provide Administrative Agent with any amendment, restatement, supplement or other modification of the PA promptly upon the execution thereof. |
6. | All notices, demands, requests, consents, approvals and other communications required or permitted hereunder (“Notices”) must be in writing and will be effective upon receipt. Notices may be given in any manner to which the parties may agree. Without limiting the foregoing, first-class mail, facsimile transmission and commercial courier service are hereby agreed to as acceptable methods for giving Notices. Regardless of the manner in which provided, Notices may be sent to a party’s address set forth above or to such other address as any party may give to the other in writing for such purpose in accordance with this Section. All notices to a Debtor shall be sent c/o Wolverine at its address set forth above. |
7. | This Agreement may be executed in any number of counterparts, which taken together shall constitute a single copy of this Agreement. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or by electronic transmission in portable document format (pdf) shall be effective as delivery of a manually executed counterpart of this Agreement. |
8. | This Agreement is governed by the laws of the State of New York without giving effect to conflicts of law principles. |
9. | This Agreement shall be binding upon and inure to the benefit of each of the parties hereto and their respective successors and assigns. |
10. | No amendment or waiver of any provision of this Agreement shall in any event be effective unless the same shall be in writing and signed by all the parties hereto, and any such amendment or waiver shall be effective only in the specific instance and for the specific purpose for which given. |
11. | Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or thereof or affecting the validity or enforceability of such provision in any other jurisdiction. |
12. | EACH PARTY HERETO HEREBY WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED OR DELIVERED PURSUANT HERETO. |
JPMORGAN CHASE BANK, N.A., as Administrative Agent (Administrative Agent) | HSBC BANK USA, N.A. (Purchaser) |
By:/s/ Krys Szremski____________ | By:/s/Kirk Bryans_____________________________ |
Print Name: Krys Szremski | Print Name: Kirk Bryans |
Title: Vice President | Title: Sr. Vice President |
Phone: ###-###-#### | Phone: ###-###-#### |
WOLVERINE WORLD WIDE, INC. | |
By:/s/ Donald T. Grimes | |
Print Name: Donald T. Grimes | |
Title: SVP, CFO & Treasurer | |
Phone: |
Seller | Jurisdiction |
Wolverine World Wide, Inc. | Delaware |
Wolverine Outdoors, Inc. | Michigan |
Sebago USA LLC | Delaware |
Saucony, Inc. | Massachusetts |
Sperry Top-Sider, LLC | Massachusetts |
Keds, LLC | Massachusetts |
Stride Rite Children’s Group, LLC | Massachusetts |
NAME | TITLE | SIGNATURE |
___________________________ | ____________________________ | |
___________________________ | ____________________________ | |
Account Debtor | Invoice Number | Amount | Invoice Date | Invoice Due Date | Date of Receipt of Payment | Payment Amount | Dilution | Excess Dilution | Unpaid Balance if any |
Name | State or Country of Incorporation or Organization | |
Forus Colombia S.A.S. | Colombia | |
Hush Puppies Retail, Inc. | Michigan | |
d/b/a Hush Puppies | ||
Hush Puppies / Merrell | ||
Hush Puppies / Merrell / Sebago | ||
Hush Puppies / Merrell / Wolverine | ||
Hush Puppies / Sebago / Merrell | ||
Merrell | ||
Rockford Footwear Depot | ||
Track ‘N Trail | ||
Wolverine Company Store | ||
Keds, LLC | Massachusetts | |
Krause Global B.V. | The Netherlands | |
LifeStyle Brands (BVI) Limited | British Virgin Islands | |
LifeStyle Brands (HK) Limited | Hong Kong | |
LifeStyle Brands of Colombia S.A.S. | Colombia | |
Open Water Ventures, LLC | Delaware | |
Robeez (UK) Ltd. | England & Wales | |
Robeez European Sales Ltd. | England & Wales | |
Rockford Global C.V. | The Netherlands | |
Saucony IP Holdings LLC | Delaware | |
Saucony UK, Inc. | Massachusetts | |
Saucony, Inc. | Massachusetts | |
Sebago Dominican Limited | Cayman Islands | |
Sebago International Limited | Cayman Islands | |
Sebago USA, LLC | Delaware | |
Spartan Shoe Company Limited | Cayman Islands | |
Sperry Top-Sider, LLC | Massachusetts | |
d/b/a Sperry Top-Sider | ||
Sperry Top-Sider / Suacony | ||
SR Holdings, LLC | Delaware | |
SR/Ecom, Inc. | Massachusetts | |
SRL, LLC | Delaware | |
Stride Rite Children’s Group, LLC | Massachusetts | |
d/b/a Stride Rite | ||
Stride Rite Keds Sperry Outlet Store | ||
Stride Rite Outlet | ||
Stride Rite Bootery | ||
Stride Rite Family Footwear | ||
Stride Rite / Saucony / Keds / Sperry Top-Sider | ||
Stride Rite / Keds / Sperry | ||
Stride Rite / Keds / Sperry Top-Sider |
Name | State or Country of Incorporation or Organization | |
Stride Rite de Mexico, S.A. de C.V. | Mexico | |
Stride Rite International Corp. | Massachusetts | |
Stride Rite International Services Brazil Ltda | Brazil | |
Stride Rite Investment Corporation | Massachusetts | |
Stride Rite Sourcing International, Inc. | Massachusetts | |
Stride Rite UK Limited | England & Wales | |
Tata International Wolverine Brands Limited | India | |
The Stride Rite Corporation | Massachusetts | |
Wolverine Consulting Services (Zhuhai) Company Limited | People’s Republic of China | |
Wolverine de Argentina S.r.l. | Argentina | |
Wolverine de Costa Rica, S.A. | Costa Rica | |
Wolverine de Mexico, S.A. de C.V. | Mexico | |
Wolverine Distribution, Inc. | Delaware | |
Wolverine Europe B.V. | The Netherlands | |
Wolverine Europe Limited | England & Wales | |
Wolverine Europe Retail B.V. | The Netherlands | |
Wolverine Europe Retail Limited | England & Wales | |
Wolverine International S.à.r.l. | Luxembourg | |
Wolverine International S.L. | Spain | |
Wolverine Newco Cayman, Ltd. | Cayman Islands | |
Wolverine Outdoors, Inc. | Michigan | |
Wolverine Procurement, Inc. | Michigan | |
Wolverine Slipper Group, Inc. | Michigan | |
d/b/a Wolverine Slipper Group | ||
Wolverine Sourcing, Inc. | Michigan | |
Wolverine Sourcing, Ltd. | Cayman Islands | |
Wolverine Trading (HK) Limited | Hong Kong | |
Wolverine Trading (Zhuhai) Company Limited | People’s Republic of China | |
Wolverine Vietnam LLC | Vietnam | |
Wolverine World Wide Canada ULC | Alberta | |
Wolverine World Wide Europe Limited | England & Wales | |
Wolverine World Wide HK Limited | Hong Kong | |
Wolverine Worldwide Brands Private Limited | India | |
Wolverine Worldwide Leathers HK Limited | Hong Kong | |
Wolverine Worldwide Leathers, Inc. | Delaware |
Date | Signature | |
February 26, 2015 | /s/ Jeffrey M. Boromisa | |
Jeffrey M. Boromisa |
Date | Signature | |
February 27, 2015 | /s/ Roxane Divol | |
Roxane Divol |
Date | Signature | |
February 26, 2015 | /s/ David T. Kollat | |
David T. Kollat |
Date | Signature | |
February 26, 2015 | /s/ Brenda J. Lauderback | |
Brenda J. Lauderback |
Date | Signature | |
February 27, 2015 | /s/ Michael A. Volkema | |
Michael A. Volkema |
Date | Signature | |
February 26, 2015 | /s/ William K. Gerber | |
William K. Gerber |
Date | Signature | |
February 26, 2015 | /s/ Timothy J. O’Donovan | |
Timothy J. O’Donovan |
Date | Signature | |
February 27, 2015 | /s/ Joseph R. Gromek | |
Joseph R. Gromek |
Date | Signature | |
February 26, 2015 | /s/ Nicholas T. Long | |
Nicholas T. Long |
Date | Signature | |
February 26, 2015 | /s/ Gina R. Boswell | |
Gina R. Boswell |
1. | I have reviewed this annual report on Form 10-K of Wolverine World Wide, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ Blake W. Krueger |
Blake W. Krueger |
Chairman, Chief Executive Officer and President |
Wolverine World Wide, Inc. |
1. | I have reviewed this annual report on Form 10-K of Wolverine World Wide, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ Donald T. Grimes |
Donald T. Grimes |
Senior Vice President, Chief Financial Officer and Treasurer |
Wolverine World Wide, Inc. |
Date: | March 3, 2015 | /s/ Blake W. Krueger |
Blake W. Krueger | ||
Chairman, Chief Executive Officer and President | ||
/s/ Donald T. Grimes | ||
Donald T. Grimes | ||
Senior Vice President, Chief Financial Officer and Treasurer |
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12 Months Ended
Investments, All Other Investments [Abstract]
Fair Value, by Balance Sheet Grouping [Table Text Block]
Schedule of Derivative Instruments [Table Text Block]
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]
In Millions, unless otherwise specified12 Months Ended
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense
$ 15.7
$ 18.4
$ 6.5
12 Months Ended
Quarterly Financial Information Disclosure [Abstract]
Quarterly Results of Operations
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