SEC Filing | Johnson Outdoors Inc.

================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended September 29, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 0-16255 JOHNSON OUTDOORS INC. (Exact name of Registrant as specified in its charter) Wisconsin 39-1536083 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 1326 Willow Road, Sturtevant, Wisconsin 53177 (Address of principal executive offices) (262) 884-1500 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to section 12(g) of the Act: Class A common stock, $.05 par value Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes. [X] No. [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K, or any amendment to this Form 10-K. [ ] As of November 1, 2000, 6,924,630 shares of Class A and 1,222,729 shares of Class B common stock of the Registrant were outstanding. The aggregate market value of voting stock of the Registrant held by nonaffiliates of the Registrant was approximately $23,888,000 on November 1, 2000. DOCUMENTS INCORPORATED BY REFERENCE Part and Item Number of Form 10-K Document into which Incorporated - -------------------------------------------------------------------------------- Johnson Outdoors Inc. Notice of Part III, Items 10, 11, 12 and 13 Annual Meeting of Shareholders and Proxy Statement for the Annual Meeting of Shareholders to be held January 31, 2001.

TABLE OF CONTENTES Page Business......................................................................1 Properties....................................................................5 Legal Proceedings.............................................................5 Submission of Matters to a Vote of Security Holders...........................5 Market for Registrant's Common Equity and Related Stockholder Matters.........5 Selected Financial Data.......................................................6 Management's Discussion and Analysis of Financial Condition and Results of Operations.................................7 Quantitative and Qualitative Disclosures about Market Risk....................11 Financial Statements and Supplementary Data...................................11 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure...........................................11 Directors and Executive Officers of the Registrant............................12 Executive Compensation........................................................12 Security Ownership of Certain Beneficial Owners and Management................12 Certain Relationships and Related Transactions................................12 Exhibits, Financial Statement Schedules and Reports on Form 8-K...............12 Signatures....................................................................13 Exhibit Index.................................................................14 Consolidated Financial Statements............................................F-1

Forward Looking Statements Certain matters discussed in this 2000 Form 10-K and in the accompanying 2000 Annual Report are "forward-looking statements," intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such because the context of the statement includes phrases such as the Company "expects," "believes" or other words of similar meaning. Similarly, statements that describe the Company's future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which could cause actual results or outcomes to differ materially from those currently anticipated. Factors that could affect actual results or outcomes include changes in consumer spending patterns, actions of companies that compete with the Company, the Company's success in managing inventory, movements in foreign currencies or interest rates and adverse weather conditions. Shareholders, potential investors and other readers are urged to consider these factors in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included herein are only made as of the date of this 2000 Form 10-K and in the accompanying 2000 Annual Report and the Company undertakes no obligations to publicly update such forward-looking statements to reflect subsequent events or circumstances. PART I ITEM 1. BUSINESS Johnson Outdoors Inc. and its subsidiaries (the "Company") design, manufacture and market outdoor recreation products in four businesses: Diving, Watercraft, Outdoor Equipment and Motors. The Company's primary focus is innovation--meeting consumer needs with breakthrough products that stand apart from the competition and advance the Company's strong brand names. Its subsidiaries are organized in a network that promotes entrepreneurialism and leverages best practices and synergies, following the strategic vision set by headquarters. The Company is controlled by Samuel C. Johnson, members of his family and related entities. The Company was incorporated in Wisconsin in 1987 as successor to various businesses. Diving The Company is one of the world's largest manufacturers and distributors of technical underwater diving products, which it sells under the Scubapro and SnorkelPro names. The Company markets a full line of underwater diving and snorkeling equipment, including regulators, stabilizing jackets, tanks, depth gauges, masks, fins, snorkels, diving electronics and other accessories. The Company is also a leading manufacturer of dive computers and other electronics sold under the Aladin and Uwatec brands. Scubapro, Aladin and Uwatec products are marketed to the high quality, premium priced segment of the market via limited distribution to independent specialty diving shops worldwide. These diving shops generally provide a wide range of services to divers, including instruction and repair service. The Company focuses on maintaining Scubapro, Aladin and Uwatec as the market leaders in innovation and new products. The Company maintains research and development functions both in the United States and Europe and holds several patents on products and features. Consumer advertising focuses on building the brand names and position as the industry's high quality and innovation leader. The Company advertises its equipment in diving magazines and through in-store displays. The Company also manufactures and markets diving buoyancy compensators primarily for the original equipment market, under the Soniform name. 1

The Company maintains manufacturing and assembly facilities in Switzerland, Mexico, Italy and Indonesia and procures a majority of its rubber and plastic products and components from third-party manufacturers. Watercraft The Company manufactures and markets canoes, kayaks, paddles, oars, recreational sailboats, personal flotation devices and small thermoformed recreational boats under the brand names Old Town, Carlisle Paddles, Ocean Kayak, Pacific Kayak, Necky, Escape, Extrasport, Swiftwater, Leisure Life and Dimension. The Company's Old Town Canoe subsidiary produces high quality canoes and kayaks for family recreation, touring and tripping. The Company uses a patented rotational-molding process for manufacturing polyethylene kayaks and canoes to compete in the high volume, low and mid-priced range of the market. These kayaks and canoes feature stiffer and more durable hulls than higher priced boats. The Company also manufactures canoes from fiberglass, Royalex (ABS) and wood. Carlisle Paddles, a manufacturer of canoe and kayak paddles and rafting oars, manufactures products that are sold by the Company's other watercraft businesses and also distributed directly through the same channels. The Company is a leading manufacturer of sit-on-top kayaks under the Ocean Kayak and Pacific Kayak brands. In addition, the Company manufactures and markets high quality Necky sea touring and whitewater kayaks; Escape recreational sailboats; Extrasport and Swiftwater personal flotation devices; small thermoformed recreational boats, including canoes, pedal boats, deck boats and tenders, under the Leisure Life brand; and the Dimension brand of kayaks. In April 2000, the Company completed the acquisition of Pacific Kayak Ltd., a manufacturer of sit-on-top and sea touring kayaks located in Auckland, New Zealand. The Company's kayaks, canoes and accessories are sold primarily to specialty stores and marine dealers, sporting goods stores and catalog and mail order houses such as L. L. Bean(R), in the United States and Europe. Leisure Life products are sold through marine dealers and large retail chains under several brand identities. The Company manufactures its Watercraft products in six locations in the United States, two locations in Canada and in New Zealand. Ocean Kayak products are also manufactured and sold under license in Europe. The North American market for kayaks is exhibiting strong growth, while the canoe market is growing modestly. The Company believes, based on industry and other data, that it is a leading manufacturer of canoes and kayaks in the United States in both unit and dollar sales. Outdoor Equipment The Company's Outdoor Equipment products include Jack Wolfskin high quality outdoor clothing, innovative footwear, camping tents, backpacks, travel gear and accessories; Eureka! military, commercial and consumer tents; Camp Trails backpacks; and Silva field compasses. Jack Wolfskin, based in Germany, distributes its products primarily through specialized outdoor stores, selected sporting goods dealers and a number of franchised Jack Wolfskin stores. Jack Wolfskin has a strong position in Germany with additional distribution in the key European markets of Great Britain, Benelux, Switzerland and Austria. The product is also sold in Canada and the United States and, under license, in Japan. Eureka! consumer tents and Camp Trails backpacks compete primarily in the mid- to high-price range and are sold in the United States and Canada through independent sales representatives, primarily to sporting goods stores, catalog and mail order houses and camping and backpacking specialty stores. Marketing of the Company's tents and backpacks is focused on building the Eureka! and Camp Trails brand names and establishing the Company as a leader in tent design and innovation. The Company's camping tents and backpacks are produced primarily by third-party manufacturing sources. 2

Eureka! camping tents have outside self-supporting aluminum frames, allowing quicker and easier set-up, a design approach the Company originated. Most Eureka! tents are made from breathable nylon. Eureka! camping products are sold under license in Japan and Korea. Eureka! commercial tents include party tents, sold primarily to general rental stores, and other commercial tents sold directly to tent erectors. Commercial tents are manufactured by the Company in the United States. The Company was awarded several contracts for production of both camping and commercial tents by the U.S. Armed Forces in 1997. The Company also serves as the exclusive distributor of Losberger commercial framing structures in the United States. Camp Trails backpacks consist primarily of internal and external frame backpacks for hiking and mountaineering, but also include soft back bags, day packs and travel packs. Silva field compasses, which are manufactured by third parties, are marketed exclusively in North America, the area for which the Company owns Silva trademark rights. Motors The Company manufactures, under its Minn Kota name, battery powered motors used on fishing boats and other boats for quiet trolling power or primary propulsion. The Company's Minn Kota motors and related accessories are sold in the United States, Canada, Europe and the Pacific Basin through large retail store chains such as Wal Mart and K-Mart, catalogs such as Bass Pro Shops and Cabelas, sporting goods specialty stores, marine dealers, and original equipment boat manufacturers including Ranger(R) Boats, Outboard Marine Corporation (under the Evinrude(R) brand), Triton Boats, Lund Boats, Smoker Craft, Alumacraft, and Skeeter. Consumer advertising and promotion include advertising on regional television and in outdoor, general interest and sports magazines. Packaging and point-of-purchase materials are used to increase consumer appeal and sales. The Company has the leading market share of the U.S. electric fishing motor market. While the overall motors market has been stagnant in recent years, the Company believes it has been able to increase revenues by emphasizing marketing, product innovation and original equipment manufacturer sales. The Company's line of Airguide marine, weather and automotive instruments is distributed primarily in the United States through large retail store chains and original equipment manufacturers. Airguide products are manufactured by the Company or sourced from third-party manufacturers. Fishing In March 2000, the Company sold its Fishing business (consisting of the marketing of rods, reels, lures, spoons and fishing line). As a result, the operations and related assets and liabilities of the Fishing business have been reclassified as discontinued for financial reporting purposes. A significant loss on the sale of the business was recognized, but the tangible net worth of the Company was not adversely impacted. See Note 4 to the Consolidated Financial Statements for financial information. Sales by Principal Business See Note 13 to the Consolidated Financial Statements for financial information comparing sales by major product category. International Operations See Note 13 to the Consolidated Financial Statements for financial information comparing the Company's domestic and international operations. Research and Development The Company commits significant resources to research and new product development. The Company expenses research and development costs as incurred. The amounts expended by the Company in connection with research and development activities for each of the last three fiscal years are set forth in the Consolidated Statements of Operations. Competition The markets for the Company's products are very competitive. The Company believes its products compete favorably on the basis of product innovation, product performance and marketing support and, to a lesser extent, price. Employees At September 29, 2000, the Company had approximately 1,400 employees. The Company considers its employee relations to be excellent. Temporary employees are utilized to manage peaks in the seasonal manufacturing of products. 3

Backlog Unfilled orders for future delivery of products of continuing operations totaled approximately $61.0 million at September 29, 2000 and $62.8 million at October 1, 1999. The Company's businesses do not receive significant orders in advance of expected shipment dates for the majority of products. Patents, Trademarks and Proprietary Rights The Company owns no single patent which is material to its business as a whole. However, the Company holds several patents, principally for diving products, rotational-molded canoes and electric motors and regularly files applications for patents. The Company has numerous trademarks and trade names which it considers important to its business, many of which are discussed on the preceding pages. The Company vigorously defends its intellectual property rights. Sources and Availability of Materials The Company's products use materials that are generally in adequate supply. Seasonality The Company's business is seasonal. The following table shows total net sales and operating profit or loss related to continuing operations of the Company for each quarter, as a percentage of the total year. Strategic charges totaling $2.4 million, $2.8 million and $1.4 million impacted operating results in 2000, 1999 and 1998, respectively. - -------------------------------------------------------------------------------- Year Ended - -------------------------------------------------------------------------------- September 29, 2000 October 1, 1999 October 2, 1998 - -------------------------------------------------------------------------------- Operating Operating Net Operating Net Profit Net Profit Quarter Ended Sales Profit Sales (Loss) Sales (Loss) - -------------------------------------------------------------------------------- December 16% 1% 16% (16)% 16% (5)% March 28 39 28 43 29 50 June 33 56 33 70 32 55 September 23 4 23 3 23 -- 100% 100% 100% 100% 100% 100% Executive Officers The following list sets forth certain information, as of December 1, 2000, regarding the executive officers of the Company. Helen P. Johnson-Leipold, age 43, became Chairman and Chief Executive Officer of the Company in March 1999. From September 1998 until March 1999, Ms. Johnson-Leipold was Vice President, Worldwide Consumer Products-Marketing of S. C. Johnson & Son, Inc. (SCJ). From October 1997 to September 1998, she was Vice President, Personal and Home Care Products of SCJ. From October 1995 until July 1997, Ms. Johnson-Leipold was Executive Vice President - North American Businesses of the Company. From 1992 to September 1995, she was Vice President - Consumer Marketing Services Worldwide of SCJ. Patrick J. O'Brien, age 42, became President and Chief Operating Officer of the Company in April 1999. From October 1997 until March 1999, Mr. O'Brien was Vice President and General Manager, Home Storage of SCJ. From July 1997 until October 1997, Mr. O'Brien was Vice President - Strategic Business of SCJ; from April 1996 until June 1997, he was Vice President - North American Sales of SCJ; from June 1995 until March 1996, he was Director - North American Sales of SCJ and from January 1993 until May 1995, he was National Sales Manager of SCJ. Mamdouh Ashour, age 62, has been a Group Vice President of the Company since October 1997 and President - Worldwide Diving since August 1996. From 1994 to August 1996, he served as President of Scubapro Europe. There are no family relationships between the above executive officers. The Company is currently conducting a search for a Chief Financial Officer. David A. Callewaert is serving as Acting Chief Financial Officer until a replacement is hired. Mr. Callewaert recently retired from S.C. Johnson Commercial Markets, Inc. where he served as Chief Financial Officer. 4

ITEM 2. PROPERTIES The Company maintains both leased and owned manufacturing, warehousing, distribution and office facilities throughout the world. The Company believes that its facilities are well maintained and have capacity adequate to meet its current needs. See Note 6 to the Consolidated Financial Statements for a discussion of lease obligations. The Company's principal manufacturing (identified with an asterisk) and other locations are: Albany, New Zealand (Watercraft) Antibes, France (Diving) Bad Sakingen, Germany (Diving) Batam, Indonesia* (Diving) Barcelona, Spain (Diving) Basingstoke, Hampshire, England (Diving) Binghamton, New York* (Outdoor Equipment) Burlington, Ontario, Canada (Motors, Outdoor Equipment) Chi Wan, Hong Kong (Diving) Ferndale, Washington* (Watercraft) Genoa, Italy* (Diving) Grand Rapids, Michigan* (Watercraft) Grayling, Michigan* (Watercraft) Hallwil, Switzerland* (Diving) Hamburg, Germany (Diving) Henggart, Switzerland (Diving) Honolulu, Hawaii (Diving) Idstein, Germany (Outdoor Equipment) Mankato, Minnesota* (Motors) Mansonville, Quebec, Canada* (Watercraft) Miami, Florida* (Watercraft) Nykoping, Sweden (Diving) Old Town, Maine* (Watercraft) Portsmouth, Rhode Island* (Watercraft) El Cajon, California (Diving) Tijuana, Mexico* (Motors, Diving) Tokyo (Kawasaki), Japan (Diving) The Company's corporate headquarters is located in Mount Pleasant, Wisconsin. The Company's mailing address is Sturtevant, Wisconsin. ITEM 3. LEGAL PROCEEDINGS See Note 16 to the Consolidated Financial Statements for a discussion of legal proceedings. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS There were no matters submitted to a vote of security holders during the last quarter of the year ended September 29, 2000. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Certain information with respect to this item is included in Notes 5, 9, 10 and 11 to the Consolidated Financial Statements. The Company's Class A common stock is traded on The Nasdaq Stock Market(R) under the symbol: JOUT. There is no public market for the Company's Class B common stock. However, the Class B common stock is convertible at all times at the option of the holder into shares of Class A common stock on a share for share basis. As of November 1, 2000, the Company had 690 holders of record of its Class A common stock and 58 holders of record of its Class B common stock. The Company has never paid a dividend on its common stock. A summary of the high and low prices for the Company's Class A common stock during each quarter of the years ended September 29, 2000 and October 1, 1999 is as follows: - -------------------------------------------------------------------------------- First Quarter Second Quarter Third Quarter Fourth Quarter - -------------------------------------------------------------------------------- 2000 1999 2000 1999 2000 1999 2000 1999 - -------------------------------------------------------------------------------- Stock prices: High $9.19 $10.25 $8.50 $9.75 $9.69 $9.50 $7.94 $9.75 Low 6.13 6.25 6.13 6.06 6.13 7.13 5.75 8.38 Last 7.10 9.25 6.19 7.38 7.06 8.88 6.94 8.94 - -------------------------------------------------------------------------------- 5

ITEM 6. SELECTED FINANCIAL DATA A summary of the Company's operating results and key balance sheet data for each of the years in the five-year period ended September 29, 2000 is presented below. All periods have been restated to reflect the discontinuation of the Company's Fishing business. - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended - ------------------------------------------------------------------------------------------------------------------------------------ September 29 October 1 October 2 October 3 September 27 - ------------------------------------------------------------------------------------------------------------------------------------ (thousands, except per share data) 2000 1999 1998 1997 1996 - ------------------------------------------------------------------------------------------------------------------------------------ Operating Results(1) Net sales $347,288 $305,094 $270,017 $239,322 $274,637 Gross profit 135,212 120,670 106,801 91,118 102,041 Operating expenses(2) 110,493 101,157 88,445 77,237 91,138 - ------------------------------------------------------------------------------------------------------------------------------------ Operating profit 24,719 19,513 18,356 13,881 10,903 Interest expense 9,799 9,565 9,631 8,413 9,563 Other income, net (160) (71) (539) (624) (498) - ------------------------------------------------------------------------------------------------------------------------------------ Income from continuing operations before income taxes 15,080 10,019 9,264 6,092 1,838 Income tax expense 6,705 4,158 3,885 2,721 2,740 - ------------------------------------------------------------------------------------------------------------------------------------ Income (loss) from continuing operations 8,375 5,861 5,379 3,371 (902) Income (loss) from discontinued operations (940) 1,161 (167) (1,315) (10,453) Loss on disposal of discontinued operations (24,418) -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $(16,983) $ 7,022 $ 5,212 $ 2,056 $(11,355) - ------------------------------------------------------------------------------------------------------------------------------------ Basic earnings (loss) per common share: Continuing operations $ 1.03 $ 0.72 $ 0.66 $ 0.42 $ (0.11) Discontinued operations (3.12) 0.15 (0.02) (0.17) (1.29) - ------------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $ (2.09) $ 0.87 $ 0.64 $ 0.25 $ (1.40) - ------------------------------------------------------------------------------------------------------------------------------------ Diluted earnings (loss) per common share: Continuing operations $ 1.03 $ 0.72 $ 0.66 $ 0.42 $ (0.11) Discontinued operations (3.12) 0.15 (0.02) (0.17) (1.29) - ------------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $ (2.09) $ 0.87 $ 0.64 $ 0.25 $ (1.40) - ------------------------------------------------------------------------------------------------------------------------------------ Diluted average common shares outstanding 8,130 8,108 8,114 8,115 8,102 - ------------------------------------------------------------------------------------------------------------------------------------ Balance Sheet Data Current assets(3) $144,194 $ 185,733 $188,224 $184,555 $221,798 Total assets 257,971 299,025 292,380 272,605 272,119 Current liabilities(4) 46,941 45,072 39,448 36,772 41,773 Long-term debt, less current maturities 45,857 72,744 81,508 87,926 60,194 Total debt 105,319 122,071 124,001 113,676 99,485 Shareholders' equity 100,832 127,178 124,386 117,731 126,424 - ------------------------------------------------------------------------------------------------------------------------------------ (1) The year ended October 3, 1997 includes 53 weeks. All other years include 52 weeks. (2) Includes strategic charges of $2,369, $2,773, $1,388, $335 and $4,487 in 2000, 1999, 1998, 1997 and 1996, respectively. (3) Includes net assets of discontinued operations of $56,114, $58,462, $66,507 and $84,851 in 1999, 1998, 1997 and 1996, respectively. (4) Excludes short-term debt and current maturities of long-term debt. 6

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion includes comments and analysis relating to the Company's results of operations and financial condition for the three years ended September 29, 2000. Unless otherwise noted, the discussion refers to continuing operations. This discussion should be read in conjunction with the Consolidated Financial Statements and related notes thereto. Results of Operations Summary consolidated financial results from continuing operations are as follows: - -------------------------------------------------------------------------------- (millions, except per share data) 2000 1999 1998 - -------------------------------------------------------------------------------- Net sales $347.3 $305.1 $270.0 Gross profit 135.2 120.7 106.8 Operating expenses(1) 110.5 101.2 88.4 Operating profit 24.7 19.5 18.4 Interest expense 9.8 9.6 9.6 Income from continuing operations 8.4 5.9 5.4 Diluted earnings per common share from continuing operations 1.03 0.72 0.66 - -------------------------------------------------------------------------------- (1) Includes strategic charges of $2.4 million, $2.8 million and $1.4 million in 2000, 1999 and 1998, respectively. 2000 vs 1999 Net Sales Net sales totaled $347.3 million in 2000 compared to $305.1 million in 1999, an increase of 14%. Sales as measured in U.S. dollars were impacted by the effect of foreign currencies relative to the U.S. dollar in comparison to 1999. Excluding the effects of foreign currency movements, sales increased 17% from 1999. The increase was partially driven by the introduction of innovative new products in the Watercraft and Motors businesses, as well as growth in sales of existing products in Watercraft, Motors and Outdoor Equipment. Operating Results The Company recognized an operating profit of $24.7 million in 2000 compared to an operating profit of $19.5 million in 1999. Gross profit margins decreased from 39.5% in 1999 to 38.9% in 2000, as significant improvements in the Diving and Outdoor Equipment businesses, as well as improvement in the Motors business (due to emphasis on higher margin products, increases in volume and improved production efficiencies) were offset by a decline in Watercraft (due to production issues related to a 26.4% growth in Watercraft revenues). The Company continues to experience margin pressure in all of its businesses due to competition. Operating expenses, excluding strategic charges, totaled $108.1 million, or 31.1% of sales, in 2000 compared to $98.4 million, or 32.2% of sales, in 1999. The 10% growth in operating expenses in 2000 was less than the growth rate of sales, which contributed to the improved operating results. Nearly all items in operating expenses declined as a percentage of sales from 1999. The Company recognized strategic charges totaling $2.4 million in 2000 and $2.8 million in 1999. These charges resulted from severance, moving and other costs related primarily to the closure and relocation of a manufacturing facility in the Motors business and for severance, relocation and recruitment costs in the North American Outdoor Equipment business. The Company anticipates no significant additional strategic charges will be incurred in 2001 to complete announced actions. Other Income and Expenses Interest expense increased $0.2 million in 2000, reflecting higher working capital levels primarily from accounts receivable and inventory, as well as higher interest rates. Overall Results The Company recognized income from continuing operations of $8.4 million in 2000, or $1.03 per diluted share, compared to $5.9 million, or $0.72 per diluted share, in 1999. The Company recorded income tax expense of $6.7 million in 2000, an effective rate of 44.5%. The increased rate from 41.5% in 1999 is due to an increase in state income tax and change in expected recoverability of state net operating losses. 7

Discontinued Operations In March 2000, the Company sold its Fishing business. As a result, operations and related assets and liabilities of the Fishing group have been classified as discontinued for all periods presented herein. The sale price totaled $47.3 million, including $14.1 million of accounts receivable retained by the Company and $2.4 million of debt assumed by the buyer. The Company recorded a loss of $24.4 million, net of tax, related to the sale of the business, taking into account operating results from the measurement date to the date of disposal. In addition, the Company recorded an after tax loss from operations up to the measurement date of $0.9 million in 2000 and an after tax gain of $1.2 million in 1999. 1999 vs 1998 Net Sales Net sales totaled $305.1 million in 1999 compared to $270.0 million in 1998, an increase of 13%. Sales as measured in U.S. dollars were impacted by the effect of foreign currencies relative to the U.S. dollar in comparison to 1998. Excluding the effects of foreign currency movements, sales increased 14.0% from 1998. The increase was due to strong growth in sales of Watercraft, including sales of products of businesses the Company acquired in 1999 and 1998, and growth in sales of Motors and Outdoor Equipment products, which more than offset weaker Diving equipment sales. Operating Results The Company recognized an operating profit of $19.5 million in 1999 compared to an operating profit of $18.4 million in 1998. Gross profit margins remained flat with 1998 at 39.6%, as a result of an improved mix of products sold in most businesses, increases in volume and the effect of businesses acquired in 1999, offset by a decline in the higher margin Diving business. Operating expenses, excluding strategic charges, totaled $98.4 million in 1999 compared to $87.1 million in 1998, a rate of 32.2% of sales in both years. The allowance for doubtful accounts receivable was increased due to higher levels of sales and receivables. These factors were partially offset by a decline from the prior year in unusual legal expenses incurred to successfully defend certain of the Company's key Outdoor Equipment, Diving and Motors patents and trademarks. The Company recognized strategic charges totaling $2.8 million in 1999 and $1.4 million in 1998. These charges resulted from severance and other costs related to the integration of acquired businesses, primarily in the Diving business, and for severance, relocation and recruitment costs in the North American Outdoor Equipment business. Other Income and Expenses Interest expense remained flat in 1999 at $9.6 million, reflecting higher debt levels resulting from the acquisition of three businesses, offset by lower levels of working capital, primarily inventory. Overall Results The Company recognized income from continuing operations of $5.9 million in 1999, or $0.72 per diluted share, compared to $5.4 million, or $0.66 per diluted share, in 1998. The Company recorded income tax expense of $4.2 million in 1999, an effective rate of 41.5%, compared to 41.9% in 1998. Discontinued Operations The Company recorded a gain, net of tax, of $1.2 million in 1999 and a loss, net of tax, of $(0.2) million in 1998 related to discontinued operations. 8

Financial Condition The following discusses changes in the Company's liquidity and capital resources. Operations The following table sets forth the Company's working capital position related to continuing operations at the end of each of the past three years: - -------------------------------------------------------------------------------- (millions) 2000 1999 1998 - -------------------------------------------------------------------------------- Current assets(1) $144.2 $129.6 $129.8 Current liabilities(2) 46.9 45.1 39.4 - -------------------------------------------------------------------------------- Working capital $ 97.3 $ 84.5 $ 90.4 - -------------------------------------------------------------------------------- Current ratio 3.1:1 2.9:1 3.3:1 - -------------------------------------------------------------------------------- (1)Excludes net assets of discontinued operations. (2)Excludes short-term debt and current maturities of long-term debt. Cash flows provided by operations totaled $9.8 million in 2000, $24.8 million in 1999 and $9.1 million in 1998. The Company's profitability and increases in accounts payable and other accrued liabilities contributed to the positive cash flows in 2000 and 1999. Growth in accounts receivable and inventories of $10.7 million and $8.4 million, respectively, reduced the overall positive cash flows provided by operations in 2000. Depreciation and amortization charges were $12.5 million in 2000, $12.6 million in 1999 and $10.8 million in 1998. Amortization of intangible assets arising from the Company's acquisitions and increased depreciation from capital spending accounted for the increase from 1998 to 1999. Investing Activities Cash flows provided by (used for) investing activities were $20.0 million, $(26.1) million and $(22.5) million in 2000, 1999 and 1998, respectively. Expenditures for property, plant and equipment were $14.1 million in 2000, $13.0 million in 1999 and $11.6 million in 1998. The Company's recurring investments are primarily related to tooling for new products, facilities and information systems improvements. In 2001, capital expenditures are anticipated to total approximately $10.5 million. These expenditures are expected to be funded by working capital or existing credit facilities. The Company completed the acquisitions of one business in 2000, three businesses in 1999 and three businesses in 1998, which increased tangible and intangible assets and debt by $0.9 million, $13.6 million and $12.8 million, respectively. The sale of the Company's Fishing business in March 2000 provided $33.1 million of cash, which was used to reduce both short-term and long-term debt. Financing Activities The following table sets forth the Company's debt and capital structure at the end of the past three years: - -------------------------------------------------------------------------------- (millions) 2000 1999 1998 - -------------------------------------------------------------------------------- Current debt $ 59.5 $ 49.4 $ 42.5 Long-term debt 45.8 72.7 81.5 - -------------------------------------------------------------------------------- Total debt 105.3 122.1 124.0 Shareholders' equity 100.8 127.2 124.4 - -------------------------------------------------------------------------------- Total capitalization $206.1 $249.3 $248.4 - -------------------------------------------------------------------------------- Total debt to total capitalization 51.1% 49.0% 49.9% - -------------------------------------------------------------------------------- Cash flows provided by (used for) financing activities totaled $(12.5) million in 2000, $(0.8) million in 1999 and $8.4 million in 1998. In 1998, the Company consummated a private placement of long-term debt totaling $25 million. Payments on long-term debt made in 2000 totaled $22 million, including a $15.1 million payment in March 2000 from the proceeds of the sale of the Fishing business. At September 29, 2000, the Company had available unused credit facilities in excess of $63 million, which is believed to be adequate for its needs. 9

Market Risk Management The Company is exposed to market risk stemming from changes in foreign exchange rates, interest rates and, to a lesser extent, commodity prices. Changes in these factors could cause fluctuations in earnings and cash flows. In the normal course of business, exposure to certain of these market risks is managed by entering into hedging transactions authorized under Company policies that place controls on these activities. Hedging transactions involve the use of a variety of derivative financial instruments. Derivatives are used only where there is an underlying exposure: not for trading or speculative purposes. Foreign Operations The Company has significant foreign operations, for which the functional currencies are denominated primarily in Swiss and French francs, German marks, Italian lire, Japanese yen and Canadian dollars. As the values of the currencies of the foreign countries in which the Company has operations increase or decrease relative to the U.S. dollar, the sales, expenses, profits, assets and liabilities of the Company's foreign operations, as reported in the Company's Consolidated Financial Statements, increase or decrease, accordingly. The Company mitigates a portion of the fluctuations in certain foreign currencies through the purchase of foreign currency swaps, forward contracts and options to hedge known commitments, primarily for purchases of inventory and other assets denominated in foreign currencies. Interest Rates The Company's debt structure and interest rate risk are managed through the use of fixed and floating rate debt. The Company's primary exposure is to United States interest rates. The Company also periodically enters into interest rate swaps, caps or collars to hedge its exposure and lower financing costs. Commodities Certain components used in the Company's products are exposed to commodity price changes. The Company manages this risk through instruments such as purchase orders and non-cancelable supply contracts. Primary commodity price exposures are metals and packaging materials. Sensitivity to Changes in Value The estimates that follow are intended to measure the maximum potential fair value or earnings the Company could lose in one year from adverse changes in foreign exchange rates or market interest rates under normal market conditions. The calculations are not intended to represent actual losses in fair value or earnings that the Company expects to incur. The estimates do not consider favorable changes in market rates. Further, since the hedging instrument (the derivative) inversely correlates with the underlying exposure, any loss or gain in the fair value of derivatives would be generally offset by an increase or decrease in the fair value of the underlying exposures. The positions included in the calculations are foreign exchange forwards, currency swaps and fixed rate debt. Certain instruments are included in both categories of risk exposure calculated below. The calculations do not include the underlying foreign exchange positions that are hedged by these market risk sensitive instruments. The table below presents the estimated maximum potential one year loss in fair value and earnings before income taxes from a 10% movement in foreign currencies and a 100 basis point movement in interest rate market risk sensitive instruments outstanding at September 29, 2000: - -------------------------------------------------------------------------------- Estimated Impact on - -------------------------------------------------------------------------------- Earnings Before (millions) Fair Value Income Taxes - -------------------------------------------------------------------------------- Foreign exchange rate instruments $2.1 $0.5 Interest rate instruments 1.4 0.5 - -------------------------------------------------------------------------------- 10

Other Factors The Company has not been significantly impacted by inflationary pressures over the last several years. The Company anticipates that changing costs of basic raw materials may impact future operating costs and, accordingly, the prices of its products. The Company is involved in continuing programs to mitigate the impact of cost increases through changes in product design and identification of sourcing and manufacturing efficiencies. Price increases and, in certain situations, price decreases are implemented for individual products, when appropriate. Pending Accounting Changes SFAS 133, Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS 137, Accounting for Derivative Instruments and Hedging Activities - Deferral of the Effective Date of FASB Statement No. 133 and SFAS 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities, is effective for the Company as of September 30, 2000. SFAS 133 requires that an entity recognize all derivatives as either assets or liabilities measured at fair value. The accounting for changes in the fair value of a derivative depends on the use of the derivative. Adoption of these new accounting standards will result in a cumulative after-tax gain in net income of approximately $1.8 million and an accumulated other comprehensive loss of approximately $3.0 million in the first quarter of fiscal 2001. The adoption will also impact assets and liabilities recorded on the balance sheet. In December 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 101, Revenue Recognition (SAB 101). An amendment in June 2000 delayed the effective date for the Company until the fourth quarter of 2001, which is when the Company will adopt the bulletin. The impact of adopting SAB 101 is still being evaluated and the Company does not currently believe its adoption will have a material impact on the consolidated financial statements. In May 2000, the Financial Accounting Standards Board's Emerging Issues Task Force (EITF) reached a consensus on Issue No. 00-14, Accounting for Certain Sales Incentives. This issue addresses the recognition, measurement, and income statement classification for various types of sales incentives including discounts, coupons, rebates and free products. The Company will adopt this consensus in the fourth quarter of 2001. The impact of this consensus is still being evaluated and the Company does not currently believe its adoption will have a material impact on the consolidated financial statements. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Information with respect to this item is included in Management's Discussion and Analysis of Financial Condition and Results of Operations under the heading "Market Risk Management." ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Information with respect to this item is included on pages F-1 to F-18. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. 11

PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT Information with respect to this item, except for certain information on executive officers (which appears at the end of Part I of this report) is included in the Company's January 31, 2001 Proxy Statement, which is incorporated herein by reference, under the headings "Election of Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance." ITEM 11. EXECUTIVE COMPENSATION Information with respect to this item is included in the Company's January 31, 2001 Proxy Statement, which is incorporated herein by reference, under the headings "Election of Directors - Compensation of Directors" and "Executive Compensation;" provided, however, that the subsection entitled "Executive Compensation - Compensation Committee Report on Executive Compensation" shall not be deemed to be incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Information with respect to this item is included in the Company's January 31, 2001 Proxy Statement, which is incorporated herein by reference, under the heading "Stock Ownership of Management and Others." ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Information with respect to this item is included in the Company's January 31, 2001 Proxy Statement, which is incorporated herein by reference, under the heading "Certain Transactions." PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K The following documents are filed as a part of this Form 10-K: Financial Statements Included in Item 8 of Part II of this Form 10-K are the following: Independent Auditors' Report Consolidated Balance Sheets - September 29, 2000 and October 1, 1999 Consolidated Statements of Operations - Years ended September 29, 2000, October 1, 1999 and October 2, 1998 Consolidated Statements of Shareholders' Equity - Years ended September 29, 2000, October 1, 1999 and October 2, 1998 Consolidated Statements of Cash Flows - Years ended September 29, 2000, October 1, 1999 and October 2, 1998 Notes to Consolidated Financial Statements Financial Statement Schedules All schedules are omitted because they are not applicable, are not required or equivalent information has been included in the Consolidated Financial Statements or notes thereto. Exhibits See Exhibit Index. Exhibits See Exhibit Index. Reports on Form 8-K No reports on Form 8-K were filed during the three months ended September 29, 2000. 12

SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the Town of Mount Pleasant and State of Wisconsin, on the 11th day of December 2000. JOHNSON outdoors INC. (Registrant) By /s/ Helen P. Johnson-Leipold ------------------------------ Helen P. Johnson-Leipold Chairman and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons in the capacities indicated on the 11th day of December 2000. /s/ Helen P. Johnson-Leipold Chairman and Chief Executive ------------------------------ Officer and Director (Helen P. Johnson-Leipold) (Principal Executive Officer) /s/ Thomas F. Pyle, Jr. Vice Chairman of the Board ------------------------------ and Director (Thomas F. Pyle, Jr.) /s/ Samuel C. Johnson Director ------------------------------ (Samuel C. Johnson) /s/ Gregory E. Lawton Director ------------------------------ (Gregory E. Lawton) /s/ Glenn N. Rupp Director ------------------------------ (Glenn N. Rupp) /s/ Terry E. London Director ------------------------------ (Terry E. London) /s/ Scott M. Vos Director of Financial Reporting ------------------------------ (Principal Accounting Officer) (Scott M. Vos) 13

EXHIBIT INDEX Exhibit Title Page No. 3.1 Articles of Incorporation of the Company as amended through * February 17, 2000. (Filed as Exhibit 3.1(a) to the Company's Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.) 3.2 Bylaws of the Company as amended through March 22, 2000. * (Filed as Exhibit 3.2(a) to the Company's Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.) 4.1 Note Agreement dated October 1, 1995. (Filed as Exhibit 4.1 * to the Company's Form 10-Q for the quarter ended December 29, 1995 and incorporated herein by reference.) 4.2 First Amendment dated October 31, 1996 to Note Agreement * dated October 1, 1995. (Filed as Exhibit 4.3 to the Company's Form 10-Q for the quarter ended December 27, 1996 and incorporated herein by reference.) 4.3 Second Amendment dated September 30, 1997 to Note Agreement * dated October 1, 1995. (Filed as Exhibit 4.8 to the Company's Form 10-K for the year ended October 3, 1997 and incorporated herein by reference.) 4.4 Third Amendment dated October 3, 1997 to Note Agreement dated * October 1, 1995. (Filed as Exhibit 4.9 to the Company's Form 10-K for the year ended October 3, 1997 and incorporated herein by reference.) 4.5 Fourth Amendment dated January 10, 2000 to Note Agreement * dated October 1, 1995. (Filed as Exhibit 4.9 to the Company's Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.) 4.6 Note Agreement dated as of September 15, 1997. (Filed as * Exhibit 4.15 to the Company's Form 10-K for the year ended October 3, 1997 and incorporated herein by reference.) 4.7 First Amendment dated January 10, 2000 to Note Agreement * dated September 15, 1997. (Filed as Exhibit 4.10 to the Company's Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.) 4.8 Amended and Restated Credit Agreement dated as of April 3, * 1998. (Filed as Exhibit 4.16 to the Company's Form 10-Q for the quarter ended April 3, 1998 and incorporated herein by reference.) 4.9 Amendment No. 1 dated September 11, 1998 to the Amended and * Restated Credit Agreement dated as of April 3, 1998. (Filed as Exhibit 4.17 to the Company's Form 10-Q for the quarter ended January 1, 1999 and incorporated herein by reference.) 4.10 Amendment No. 2 dated September 30, 1999 to the Amended and * Restated Credit Agreement dated as of April 3, 1998. (Filed as Exhibit 4.8 to the Company's Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.) 9 Johnson Outdoors Inc. Class B common stock Voting Trust * Agreement, dated December 30, 1993 (Filed as Exhibit 9 to the Company's Form 10-Q for the quarter ended December 31, 1993 and incorporated herein by reference.) 10.1 Stock Purchase Agreement, dated as of January 12, 2000, by * and between Johnson Outdoors Inc. and Berkley Inc. (Filed as Exhibit 2.1 to the Company's Form 8-K dated March 31, 2000 and incorporated herein by reference.) 10.2 Amendment to Stock Purchase Agreement, dated as of February * 28, 2000, by and between Johnson Outdoors Inc. and Berkley Inc. (Filed as Exhibit 2.2 to the Company's Form 8-K dated March 31, 2000 and incorporated herein by reference.) 10.3 Johnson Outdoors Inc. Amended and Restated 1986 Stock Option * Plan. (Filed as Exhibit 10 to the Company's Form 10-Q for the quarter ended July 2, 1993 and incorporated herein by reference.) 14

Exhibit Title Page No. 10.4 Registration Rights Agreement regarding Johnson Outdoors Inc. * common stock issued to the Johnson family prior to the acquisition of Johnson Diversified, Inc. (Filed as Exhibit 10.6 to the Company's Form S-1 Registration Statement No. 33-16998 and incorporated herein by reference.) 10.5 Registration Rights Agreement regarding Johnson Outdoors Inc. * Class A common stock held by Mr. Samuel C. Johnson. (Filed as Exhibit 28 to the Company's Form 10-Q for the quarter ended March 29, 1991 and incorporated herein by reference.) 10.6+ Form of Restricted Stock Agreement. (Filed as Exhibit 10.8 to * the Company's Form S-1 Registration Statement No. 33-23299 and incorporated herein by reference.) 10.7+ Form of Supplemental Retirement Agreement of Johnson * Diversified, Inc. (Filed as Exhibit 10.9 to the Company's Form S-1 Registration Statement No. 33-16998 and incorporated herein by reference.) 10.8+ Johnson Outdoors Retirement and Savings Plan. (Filed as * Exhibit 10.9 to the Company's Form 10-K for the year ended September 29, 1989 and incorporated herein by reference.) 10.9+ Form of Agreement of Indemnity and Exoneration with Directors * and Officers. (Filed as Exhibit 10.11 to the Company's Form S-1 Registration Statement No. 33-16998 and incorporated herein by reference.) 10.10 Consulting and administrative agreements with S. C. Johnson & * Son, Inc. (Filed as Exhibit 10.12 to the Company's Form S-1 Registration Statement No. 33-16998 and incorporated herein by reference.) 10.11+ Johnson Outdoors Inc. 1994 Long-Term Stock Incentive Plan. * (Filed as Exhibit 4 to the Company's Form S-8 Registration Statement No. 333-88091 and incorporated herein by reference.) 10.12+ Johnson Outdoors Inc. 1994 Non-Employee Director Stock * Ownership Plan. (Filed as Exhibit 4 to the Company's Form S-8 Registration Statement No. 333-88089 and incorporated herein by reference.) 10.13+ Johnson Outdoors Economic Value Added Bonus Plan (Filed as * Exhibit 10.15 to the Company's Form 10-K for the year ended October 3, 1997 and incorporated herein by reference.) 10.14+ Johnson Outdoors Inc. 2000 Long-Term Stock Incentive Plan. * (Filed as Exhibit 10.16 to the Company's Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.) 10.15+ Severance Agreement and Release, dated June 9, 2000, between * the Company and Carl G. Schmidt. 11. Statement regarding computation of per share earnings. (Note * 15 to the Consolidated Financial Statements of the Company's 2000 Form 10-K is incorporated herein by reference.) 21. Subsidiaries of the Company as of September 29, 2000. 23. Consent of KPMG LLP. 27. Financial Data Schedule (EDGAR version only) 99. Definitive Proxy Statement for the 2001 Annual Meeting of * Shareholders. Except to the extent specifically incorporated herein by reference, the Proxy Statement for the 2001 Annual Meeting of Shareholders shall not be deemed to be filed with the Securities and Exchange Commission as part of this Form 10-K. The Proxy Statement for the 2001 Annual Meeting of Shareholders will be filed with the Securities and Exchange Commission under regulation 14A within 120 days after the end of the Company's fiscal year. * Incorporated herein by reference. + A management contract or compensatory plan or arrangement. 15

CONSOLIDATED FINANCIAL STATEMENTS Table of Contents Page Report of Management.............................................F-1 Independent Auditors' Report.....................................F-1 Consolidated Balance Sheets......................................F-2 Consolidated Statements of Operations............................F-3 Consolidated Statements of Shareholders' Equity..................F-4 Consolidated Statements of Cash Flows............................F-5 Notes to Consolidated Financial Statements.......................F-6

REPORT OF MANAGEMENT The management of Johnson Outdoors Inc. is responsible for the preparation and integrity of all financial statements and other information contained in this Form 10-K. We rely on a system of internal financial controls to meet the responsibility of providing accurate financial statements. The system provides reasonable assurances that assets are safeguarded, that transactions are executed in accordance with management's authorization and that the financial statements are prepared on a worldwide basis in accordance with accounting principles generally accepted in the United States of America. The financial statements for each of the years covered in this Form 10-K have been audited by independent auditors, who have provided an independent assessment as to the fairness of the financial statements, after obtaining an understanding of the Company's systems and procedures and performing such other tests as deemed necessary. The Audit Committee of the Board of Directors, which is composed solely of directors who are not officers of the Company, meets with management and the independent auditors to review the results of their work and to satisfy itself that their respective responsibilities are being properly discharged. The independent auditors have full and free access to the Audit Committee and have regular discussions with the Committee regarding appropriate auditing and financial reporting matters. /s/ Helen P. Johnson-Leipold Helen P. Johnson-Leipold Chairman and Chief Executive Officer /s/ Scott M. Vos Scott M. Vos Director of Financial Reporting

INDEPENDENT AUDITORS' REPORT Shareholders and Board of Directors Johnson Outdoors Inc.: We have audited the consolidated balance sheets of Johnson Outdoors Inc. and subsidiaries as of September 29, 2000 and October 1, 1999, and the related consolidated statements of operations, shareholders' equity, and cash flows for each of the years in the three-year period ended September 29, 2000. These Consolidated Financial Statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these Consolidated Financial Statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the Consolidated Financial Statements referred to above present fairly, in all material respects, the financial position of Johnson Outdoors Inc. and subsidiaries as of September 29, 2000 and October 1, 1999, and the results of their operations and their cash flows for each of the years in the three-year period ended September 29, 2000, in conformity with accounting principles generally accepted in the United States of America. /s/ KPMG LLP KPMG LLP Milwaukee, Wisconsin November 6, 2000 F-1

CONSOLIDATED BALANCE SHEETS - ----------------------------------------------------------------------------------------------------------------------------------- September 29 October 1 (thousands, except share data) 2000 1999 - ----------------------------------------------------------------------------------------------------------------------------------- Assets Current assets: Cash and temporary cash investments $ 17,363 $ 9,974 Accounts receivable, less allowance for doubtful accounts of $3,895 and $3,236, respectively 54,825 49,302 Inventories 62,708 59,981 Deferred income taxes 4,613 4,718 Other current assets 4,685 5,644 Net assets of discontinued operations -- 56,114 - ----------------------------------------------------------------------------------------------------------------------------------- Total current assets 144,194 185,733 Property, plant and equipment, net 37,369 35,323 Deferred income taxes 17,311 11,277 Intangible assets, net 57,866 65,599 Other assets 1,231 1,093 - ----------------------------------------------------------------------------------------------------------------------------------- Total assets $ 257,971 $ 299,025 - ----------------------------------------------------------------------------------------------------------------------------------- Liabilities And Shareholders' Equity Current liabilities: Short-term debt and current maturities of long-term debt $ 59,462 $ 49,327 Accounts payable 12,928 16,034 Accrued liabilities: Salaries and wages 7,421 6,912 Income taxes 140 (160) Other 26,452 22,286 - ----------------------------------------------------------------------------------------------------------------------------------- Total current liabilities 106,403 94,399 Long-term debt, less current maturities 45,857 72,744 Other liabilities 4,879 4,704 - ----------------------------------------------------------------------------------------------------------------------------------- Total liabilities 157,139 171,847 - ----------------------------------------------------------------------------------------------------------------------------------- Shareholders' equity: Preferred stock: none issued -- -- Common stock: Class A shares issued: September 29, 2000, 6,924,630; October 1, 1999, 6,910,577 346 345 Class B shares issued (convertible into Class A shares): September 29, 2000, 1,222,729; October 1, 1999, 1,222,861 61 61 Capital in excess of par value 44,291 44,205 Retained earnings 74,797 91,832 Contingent compensation (77) (134) Accumulated other comprehensive income - cumulative translation adjustment (18,586) (9,049) Treasury stock, Class A shares, at cost: October 1, 1999, 5,280 -- (82) - ----------------------------------------------------------------------------------------------------------------------------------- Total shareholders' equity 100,832 127,178 - ----------------------------------------------------------------------------------------------------------------------------------- Total liabilities and shareholders' equity $ 257,971 $ 299,025 - ----------------------------------------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of the Consolidated Financial Statements. F-2

CONSOLIDATED STATEMENTS OF OPERATIONS - ----------------------------------------------------------------------------------------------------------------------------------- Year Ended - ----------------------------------------------------------------------------------------------------------------------------------- September 29 October 1 October 2 - ----------------------------------------------------------------------------------------------------------------------------------- (thousands, except per share data) 2000 1999 1998 - ----------------------------------------------------------------------------------------------------------------------------------- Net sales $ 347,288 $ 305,094 $ 270,017 Cost of sales 212,076 184,424 163,216 - ----------------------------------------------------------------------------------------------------------------------------------- Gross profit 135,212 120,670 106,801 - ----------------------------------------------------------------------------------------------------------------------------------- Operating expenses: Marketing and selling 66,084 59,826 54,841 Administrative management, finance and information systems 28,442 26,372 22,835 Research and development 7,854 6,878 5,613 Amortization of acquisition costs 2,951 2,912 2,495 Profit sharing 2,793 2,396 1,273 Strategic charges 2,369 2,773 1,388 - ----------------------------------------------------------------------------------------------------------------------------------- Total operating expenses 110,493 101,157 88,445 - ----------------------------------------------------------------------------------------------------------------------------------- Operating profit 24,719 19,513 18,356 Interest income (421) (294) (329) Interest expense 9,799 9,565 9,631 Other (income) expense, net 261 223 (210) - ----------------------------------------------------------------------------------------------------------------------------------- Income from continuing operations before income taxes 15,080 10,019 9,264 Income tax expense 6,705 4,158 3,885 - ----------------------------------------------------------------------------------------------------------------------------------- Income from continuing operations 8,375 5,861 5,379 Income (loss) from discontinued operations, net of income tax expense (benefit) of $(563), $771 and $52, respectively (940) 1,161 (167) Loss on disposal of discontinued operations, net of income tax benefit of $(1,840) (24,418) -- -- - ----------------------------------------------------------------------------------------------------------------------------------- Net income (loss) (16,983) 7,022 5,212 - ----------------------------------------------------------------------------------------------------------------------------------- Basic earnings (loss) per common share: Continuing operations $ 1.03 $ 0.72 $ 0.66 Discontinued operations (3.12) 0.15 (0.02) - ----------------------------------------------------------------------------------------------------------------------------------- Net income (loss) $ (2.09) $ 0.87 $ 0.64 - ----------------------------------------------------------------------------------------------------------------------------------- Diluted earnings (loss) per common share: Continuing operations $ 1.03 $ 0.72 $ 0.66 Discontinued operations (3.12) 0.15 (0.02) - ----------------------------------------------------------------------------------------------------------------------------------- Net income (loss) $ (2.09) $ 0.87 $ 0.64 - ----------------------------------------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of the Consolidated Financial Statements. F-3

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - ----------------------------------------------------------------------------------------------------------------------------------- Capital in Cumulative Common Excess of Retained Contingent Translation Treasury Comprehensive (thousands) Stock Par Value Earnings Compensation Adjustment Stock Income (Loss) - ----------------------------------------------------------------------------------------------------------------------------------- Balance at October 3, 1997 406 44,186 79,882 (85) (6,356) (302) Net income -- -- 5,212 -- -- -- $ 5,212 Exercise of stock options -- -- (4) -- -- 146 -- Tax benefit of stock options exercised -- 6 -- -- -- -- -- Issuance of restricted stock -- 13 -- (32) -- 32 -- Issuance of stock under employee stock purchase plan -- -- (22) -- -- 177 -- Amortization of contingent compensation -- -- -- 90 -- -- -- Other treasury stock transactions -- -- -- -- -- (668) -- Translation adjustment -- -- -- -- 1,705 -- 1,705 - ----------------------------------------------------------------------------------------------------------------------------------- Balance at October 2, 1998 406 44,205 85,068 (27) (4,651) (615) $ 6,917 Net income -- -- 7,022 -- -- -- $ 7,022 Issuance of restricted stock -- -- (137) (182) -- 319 -- Issuance of stock under employee stock purchase plan -- -- (121) -- -- 214 -- Amortization of contingent compensation -- -- -- 75 -- -- -- Translation adjustment -- -- -- -- (4,398) -- (4,398) - ----------------------------------------------------------------------------------------------------------------------------------- Balance at October 1, 1999 406 44,205 91,832 (134) (9,049) (82) $ 2,624 Net loss -- -- (16,983) -- -- -- $(16,983) Issuance of restricted stock -- 19 -- (19) -- -- -- Issuance of stock under employee stock purchase plan 1 67 (52) -- -- 82 -- Amortization of contingent compensation -- -- -- 76 -- -- -- Translation adjustment -- -- -- -- (10,346) -- (10,346) Translation adjustment reclassified to net loss on sale of Fishing business -- -- -- -- 809 -- -- - ----------------------------------------------------------------------------------------------------------------------------------- Balance at September 29, 2000 $407 $44,291 $74,797 $(77) $(18,586) $ -- $(27,329) - ----------------------------------------------------------------------------- ------------------------------------------------------ The accompanying notes are an integral part of the Consolidated Financial Statements. F-4

CONSOLIDATED STATEMENTS OF CASH FLOWS - ----------------------------------------------------------------------------------------------------------------------------------- Year Ended - ----------------------------------------------------------------------------------------------------------------------------------- September 29 October 1 October 2 (thousands) 2000 1999 1998 - ----------------------------------------------------------------------------------------------------------------------------------- Cash Provided By Operations Net income (loss) $ (16,983) $ 7,022 $ 5,212 Less income (loss) from discontinued operations (25,358) 1,161 (167) Income from continuing operations 8,375 5,861 5,379 Adjustments to reconcile income from continuing operations to net cash provided by operating activities of continuing operations: Depreciation and amortization 12,523 12,597 10,814 Provision for doubtful accounts receivable 1,812 2,162 819 Provision for inventory reserves 853 801 269 Deferred income taxes (374) (48) (3,227) Change in assets and liabilities, net of effect of businesses acquired or sold: Accounts receivable (10,728) (3,466) (2,356) Inventories (8,358) 1,012 (1,145) Accounts payable and accrued liabilities 3,910 5,975 (1,750) Other, net 1,738 (106) 308 - ----------------------------------------------------------------------------------------------------------------------------------- 9,751 24,788 9,111 - ----------------------------------------------------------------------------------------------------------------------------------- Cash Provided By (Used For) Investing Activities Proceeds from sale of business, net of cash 33,126 -- -- Payments for purchase of businesses, net of cash acquired (864) (13,584) (12,772) Net additions to property, plant and equipment (14,075) (13,035) (11,636) Sales of property, plant and equipment 1,838 501 1,894 - ----------------------------------------------------------------------------------------------------------------------------------- 20,025 (26,118) (22,514) - ----------------------------------------------------------------------------------------------------------------------------------- Cash Provided By (Used For) Financing Activities Issuance of senior notes -- -- 25,000 Principal payments on senior notes and other long-term debt (21,969) (7,705) (7,863) Net change in short-term debt 9,351 6,764 (8,424) Common stock transactions 97 94 (352) - ----------------------------------------------------------------------------------------------------------------------------------- (12,521) (847) 8,361 - ----------------------------------------------------------------------------------------------------------------------------------- Effect of foreign currency fluctuations on cash (1,790) (541) 216 Net cash provided by (used for) discontinued operations (8,076) 2,361 8,223 - ----------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) in cash and temporary cash investments 7,389 (357) 3,397 Cash And Temporary Cash Investments Beginning of year 9,974 10,331 6,934 - ----------------------------------------------------------------------------------------------------------------------------------- End of year $ 17,363 $ 9,974 $ 10,331 - ----------------------------------------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of the Consolidated Financial Statements. F-5

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Johnson Outdoors Inc. is an integrated, global outdoor recreation products company engaged in the design, manufacture and marketing of brand name outdoor equipment, diving, watercraft and motors products. 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES All monetary amounts, other than share and per share amounts, are stated in thousands and are from continuing operations. Principles of Consolidation The Consolidated Financial Statements include the accounts of Johnson Outdoors Inc. and all majority owned subsidiaries (the Company) and are stated in conformity with accounting principles generally accepted in the United States of America. Significant intercompany accounts and transactions have been eliminated in consolidation. The Consolidated Financial Statements have been restated to reflect the results of the Fishing business as a discontinued operation. See Note 4. The preparation of financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities and operating results and the disclosure of commitments and contingent liabilities. Actual results could differ significantly from those estimates. For the Company, significant estimates include the allowance for doubtful accounts receivable, reserves for inventory valuation and the valuation allowance for deferred tax assets. The Company's fiscal year ends on the Friday nearest September 30. The fiscal years ended September 29, 2000 (hereinafter 2000) and October 1, 1999 (hereinafter 1999) and October 2, 1998 (hereinafter 1998) each comprise 52 weeks. Cash and Temporary Cash Investments For purposes of the consolidated statements of cash flows, the Company considers all short-term investments in interest-bearing bank accounts, securities and other instruments with an original maturity of three months or less to be equivalent to cash. The Company maintains cash in bank accounts in excess of insured limits. The Company has not experienced any losses as a result of this practice and does not believe that significant credit risk exists. Inventories Inventories are stated at the lower of cost (determined using the first-in, first-out method) or market. Inventories attributable to continuing operations at the end of the respective years consist of the following: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Raw materials $ 23,122 $ 22,702 Work in process 2,238 3,176 Finished goods 40,297 39,014 - ------------------------------------------------------------------------------- 65,657 64,892 Less reserves 2,949 4,911 - ------------------------------------------------------------------------------- $ 62,708 $ 59,981 - ------------------------------------------------------------------------------- Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation of plant and equipment is determined by straight-line and accelerated methods over estimated useful lives, which range from 3 to 30 years. Upon retirement or disposition, cost and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operating results. Property, plant and equipment attributable to continuing operations at the end of the respective years consist of the following: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Property and improvements $ 1,423 $ 1,275 Buildings and improvements 19,303 16,301 Furniture, fixtures and equipment 82,994 74,667 - ------------------------------------------------------------------------------- 103,720 92,243 - ------------------------------------------------------------------------------- Less accumulated depreciation 66,351 56,920 - ------------------------------------------------------------------------------- $ 37,369 $ 35,323 - ------------------------------------------------------------------------------- F-6

Intangible Assets Intangible assets are stated at cost less accumulated amortization. Amortization is computed using the straight-line method with periods ranging from 15 to 40 years for goodwill and 3 to 16 years for patents, trademarks and other intangible assets. Intangible assets attributable to continuing operations at the end of the respective years consist of the following: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Goodwill $ 69,546 $ 75,254 Patents, trademarks and other 4,122 4,110 - ------------------------------------------------------------------------------- 73,668 79,364 Less accumulated amortization 15,802 13,765 - ------------------------------------------------------------------------------- $ 57,866 $ 65,599 - ------------------------------------------------------------------------------- Impairment of Long-Lived Assets The Company annually assesses the recoverability of property, plant and equipment and intangible assets, primarily by determining whether the depreciation and amortization of the balance over its remaining life can be recovered through projected undiscounted future operating cash flows of the related businesses. The amount of impairment, if any, is measured primarily based on the deficiency of projected discounted future operating cash flows relative to the value of the assets, using a discount rate reflecting the Company's cost of capital, which currently approximates 10%. Income Taxes The Company provides for income taxes currently payable, and deferred income taxes resulting from temporary differences between financial statement and taxable income, using the asset and liability method. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion, or all of the deferred tax assets, will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the years in which those temporary differences become deductible. The Company considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Federal and state income taxes are provided on foreign subsidiary income distributed to, or taxable in, the United States during the year. At September 29, 2000, net undistributed earnings of foreign subsidiaries total approximately $55,500. A substantial portion of these unremitted earnings have been permanently invested abroad and no provision for federal or state taxes is made on these amounts. With respect to that portion of foreign earnings which may be returned to the United States, provision is made for taxes if the amounts are significant. The Company's United States entities file a consolidated federal income tax return. Employee Benefits The Company and certain of its subsidiaries have various retirement and profit sharing plans. United States pension obligations, which are generally based on compensation and years of service, are funded by payments to pension fund trustees. Foreign plans are funded as expenses are incurred. The Company's policy is generally to fund the minimum amount required under the Employee Retirement Income Security Act of 1974 for plans subject thereto. Profit sharing and other retirement costs are funded at least annually. Foreign Operations and Derivative Financial Instruments Assets and liabilities of foreign operations are translated into U.S. dollars at the rate of exchange existing at the end of the year. Results of operations are translated at monthly average exchange rates. Gains and losses resulting from the translation of foreign currency financial statements are classified as accumulated other comprehensive income, a separate component of shareholders' equity. The Company operates internationally, which gives rise to exposure to market risk from movements in foreign exchange rates. The Company uses foreign currency forward contracts and options in its selective hedging of foreign exchange exposure. Gains and losses on contracts that qualify as hedges are recognized as an adjustment of the carrying amount of the item hedged. The Company primarily hedges assets, inventory purchases and loans denominated in foreign currencies. The Company does not enter into foreign exchange contracts for trading purposes. Gains and losses on unhedged exposures are recorded in operating results. F-7

At September 29, 2000, foreign currency forward contracts and options with a notional value of approximately $5,100 are in place, hedging existing and anticipated transactions. Substantially all of these contracts mature in 2000. Failure of the counterparties to perform their obligations under these contracts would expose the Company to the risk of foreign currency rate movements for those contracts. The Company does not believe the risk is significant. At September 29, 2000, the fair value of these instruments is $(0.4). Foreign currency swaps effectively denominate, in foreign currencies, existing U.S. dollar denominated debt of the Company. This foreign currency debt serves as a hedge of foreign assets. Accordingly, gains and losses on such swaps are recorded in shareholders' equity. At September 29, 2000, the fair value of these instruments is $3.0. SFAS 133, Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS 137, Accounting for Derivative Instruments and Hedging Activities - Deferral of the Effective Date of FASB Statement No. 133 and SFAS 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities, is effective for the Company as of September 30, 2000. SFAS 133 requires that an entity recognize all derivatives as either assets or liabilities measured at fair value. The accounting for changes in the fair value of a derivative depends on the use of the derivative. Adoption of these new accounting standards will result in a cumulative after-tax gain in net income of approximately $1.8 million and an accumulated other comprehensive loss of approximately $3.0 million in the first quarter of fiscal 2001. The adoption will also impact assets and liabilities recorded on the balance sheet. Revenue Recognition Revenue from sales is recognized on the accrual basis, primarily upon the shipment of products, net of estimated costs of returns and allowances. Advertising The Company expenses substantially all costs related to production of advertising the first time the advertising takes place. Cooperative promotional arrangements are accrued in relation to sales. Advertising expense attributable to continuing operations in 2000, 1999 and 1998 totals $18,435, $16,258 and $13,647, respectively. Capitalized costs attributable to continuing operations at September 29, 2000 and October 1, 1999 total $1,360 and $1,100, respectively, and primarily include catalogs and costs of advertising which has not yet run for the first time. Research and Development Research and development costs are expensed as incurred. Stock-Based Compensation The Company accounts for stock options using the intrinsic value based method. Accordingly, compensation cost is generally recognized only for stock options issued with an exercise price lower than the market price on the date of grant. The fair value of restricted shares awarded in excess of the amount paid for such shares is recognized as contingent compensation and is amortized over 1 to 3 years from the date of award, the period after which all restrictions generally lapse. Pending Accounting Changes In addition to SFAS 133 as previously noted, in December 1999, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 101, Revenue Recognition (SAB 101). An amendment in June 2000 delayed the effective date for the Company until the fourth quarter of 2001, which is when the Company will adopt the bulletin. The impact of adopting SAB 101 is still being evaluated and the Company does not currently believe its adoption will have a material impact on the consolidated financial statements. F-8

In May 2000, the Financial Accounting Standards Board's Emerging Issues Task Force (EITF) reached a consensus on Issue No. 00-14, Accounting for Certain Sales Incentives. This issue addresses the recognition, measurement, and income statement classification for various types of sales incentives including discounts, coupons, rebates and free products. The Company will adopt this consensus in the fourth quarter of 2001. The impact of this consensus is still being evaluated and the Company does not currently believe its adoption will have a material impact on the consolidated financial statements. Reclassifications Certain reclassifications have been made to prior years' amounts to conform with the current year presentation. 2 STRATEGIC CHARGES In 2000, 1999 and 1998, the Company recorded strategic charges totaling $2,369, $2,773 and $1,388, respectively. In 2000 strategic charges include severance, moving and other exit costs related primarily to the closure and relocation of a manufacturing facility in the Motors business. Severance costs included in the strategic charges totaled $1,469 and approximately 95 employees were impacted by these actions. Unexpended funds at year end related to these actions were approximately $750. In 1999, a portion of the charges included severance, moving and recruiting costs related to the relocation of certain sales and marketing functions of the Company's Outdoor Equipment business. The balance of the charges were related to the integration of acquired businesses. Severance costs included in these charges totaled $1,101 and approximately 30 employees were impacted. In 1998, strategic charges included severance and other exit related costs primarily for the integration of acquired companies in the Diving business. Severance costs totaled $781 and approximately 80 employees were impacted. 3 ACQUISITIONS In April 2000, the Company completed the acquisition of the common stock of Pacific Kayak Ltd., a manufacturer of sit-on-top and sea touring kayaks located in Auckland, New Zealand. The initial purchase price, including direct expenses, for the acquisition was approximately $962, of which approximately $584 was recorded as intangible assets and is being amortized over 25 years. An additional payment in 2001 is dependent upon achievement of specified levels of sales of the acquired business. In July 1999, the Company completed the acquisition of the common stock of Extrasport, Inc., a privately held manufacturer and marketer of personal flotation devices. The initial purchase price, including direct expenses, for the acquisition was approximately $3,300, of which approximately $2,500 was recorded as intangible assets and is being amortized over 25 years. In September 2000, an additional payment of approximately $150 was accrued. Additional payments in 2001 and 2002 are dependent upon achievement of specified levels of sales of the acquired business. In April 1999, the Company completed the acquisition of substantially all of the assets and the assumption of certain liabilities of Escape Sailboat Company LLC, a privately held manufacturer and marketer of recreational sailboats. The initial purchase price, including direct expenses, for the acquisition was approximately $4,800, of which approximately $3,100 was recorded as intangible assets and is being amortized over 25 years. An additional payment in 2001 is dependent upon achievement of specified levels of sales of the acquired business. In December 1998, the Company completed the acquisition of substantially all of the assets and the assumption of certain liabilities of True North Paddle & Necky Kayaks Ltd., a privately held manufacturer and marketer of Necky kayaks, and an affiliated entity. The initial purchase price, including direct expenses, for the acquisition was approximately $5,700, of which approximately $3,200 was recorded as intangible assets and is being amortized over 25 years. Additional payments of approximately $170 and $600 were earned in 2000 and 1999, respectively. Additional payments in the years 2001 through 2003 are dependent upon the achievement of specified levels of sales and profitability of the acquired business. F-9

In February 1998, the Company completed the acquisition of the common stock of Leisure Life Limited, a privately held manufacturer and marketer of recreational watercraft. The purchase price, including direct expenses, for the acquisition was approximately $10,300, of which approximately $7,300 was recorded as intangible assets and is being amortized over 25 years. In September 1997, subsequent to the end of the 1997 fiscal year, the Company completed the acquisitions of certain assets of Soniform, Inc., a manufacturer of diving buoyancy compensators, and the common stock of Plastiques L.P.A. Limitee, a privately held Canadian manufacturer of kayaks. The purchase prices for the acquisitions totaled approximately $3,400. All acquisitions were accounted for using the purchase method and, accordingly, the Consolidated Financial Statements include the results of operations since the respective dates of acquisition. Additional payments, if required, will increase intangible assets. 4 SALE OF FISHING BUSINESS In March 2000, the Company sold its Fishing business. As a result, operations and related assets and liabilities of the Fishing group have been classified as discontinued for all periods presented herein. The sale price totaled $47,279, including $14,056 of accounts receivable retained by the Company and $2,367 of debt assumed by the buyer. The Company recorded a loss of $24,418, net of tax, related to the sale of the business, taking into account operating results from the measurement date to the date of disposal. In addition, the Company recorded an after tax loss from operations up to the measurement date of $940 in 2000, an after tax gain of $1,161 in 1999 and an after tax loss of $167 in 1998. Net sales of the Fishing group were $32,667, $59,184 and $58,508 for 2000, 1999 and 1998, respectively. Interest expense of $90, $154 and $1,016 that is directly attributable to the Fishing group is allocated to discontinued operations. 5 INDEBTEDNESS Short-term debt at the end of the respective years consists of the following: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Commercial paper and bank loans $ 53,434 $ 43,380 Current maturities of long-term debt 6,028 5,947 - ------------------------------------------------------------------------------- $ 59,462 $ 49,327 - ------------------------------------------------------------------------------- Short-term credit facilities provide for borrowings with interest rates set periodically by reference to market rates. Commercial paper rates are set by competitive bidding. The weighted average interest rate on short-term indebtedness was 7.6% and 6.2% at September 29, 2000 and October 1, 1999, respectively. The Company's primary facility is a $100,000 revolving credit agreement expiring in 2001, which includes a maximum amount of $80,000 in support of commercial paper issuance. The Company has lines of credit, both foreign and domestic, totaling $122,000 of which $63,000 is available at September 29, 2000. The Company also utilizes letters of credit for trade financing purposes. Long-term debt at the end of the respective years consists of the following: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- 1998 senior notes $ 16,176 $ 24,981 1996 senior notes 29,700 45,000 Other long-term notes, maturing through January 2004 6,009 8,710 - ------------------------------------------------------------------------------- 51,885 78,691 Less current maturities 6,028 5,947 - ------------------------------------------------------------------------------- $ 45,857 $ 72,744 - ------------------------------------------------------------------------------- F-10

In 1998, the Company issued unsecured senior notes totaling $25,000 with an interest rate of 7.15%. Simultaneous with the commitment of the 1998 senior notes, the Company executed a foreign currency swap, denominating in Swiss francs all principal and interest payments required under the 1998 senior notes. The fixed, effective interest rate to be paid on the 1998 senior notes as a result of the currency swap is 4.32%. A portion of the proceeds from the divestiture of the Fishing business was used to make an unscheduled principal payment of $5,335 in March 2000. The 1998 senior notes have annual principal payments of $1,721 to $6,023 beginning October 2001 with a final payment due October 2007. Proceeds from issuance of the 1998 senior notes were used to reduce outstanding indebtedness under the Company's primary revolving credit facility. $5,676 of the initial purchase price for the common stock of Uwatec AG is due in 2002. Interest on the deferred amounts is payable annually at 6%. This obligation is denominated in Swiss francs. A corresponding amount of the Company's primary revolving credit facility is reserved in support of this obligation through issuance of a letter of credit. In 1996, the Company issued unsecured senior notes totaling $30,000 with an interest rate of 7.77% and $15,000 with an interest rate of 6.98%. A portion of the proceeds from the divestiture of the Fishing business was used to make an unscheduled principal payment of $9,800 in March 2000. Total annual principal payments ranging from $5,500 to $7,500 are due beginning in October 2000 through 2006. Aggregate scheduled maturities of long-term debt in each of the five years ending September 2005 are as follows: - ------------------------------------------------------------------------------- Year - ------------------------------------------------------------------------------- 2001 $ 6,000 2002 13,500 2003 7,800 2004 9,300 2005 5,400 Interest paid was $10,471, $9,740 and $8,921 for 2000, 1999 and 1998, respectively. Based on the borrowing rates currently available to the Company for debt with similar terms and average maturities, the fair value of the Company's long-term debt as of September 29, 2000 and October 1, 1999 is approximately $53,000 and $79,700, respectively. The carrying value of all other financial instruments approximates the fair value. Certain of the Company's loan agreements require that Samuel C. Johnson, members of his family and related entities (hereinafter the Johnson Family) continue to own stock having votes sufficient to elect a 51% majority of the directors. At September 29, 2000, the Johnson Family held approximately 3,300,000 shares or 48% of the Class A common stock, approximately 1,168,000 shares or 96% of the Class B common stock and approximately 78% of the voting power of both classes of common stock taken as a whole. The agreements also contain restrictive covenants regarding the Company's net worth, indebtedness, fixed charge coverage and distribution of earnings. The Company is in compliance with the restrictive covenants of such agreements, as amended from time to time. 6 LEASES AND OTHER COMMITMENTS The Company leases certain operating facilities and machinery and equipment under long-term, noncancelable operating leases. Future minimum rental commitments under noncancelable operating leases attributable to continuing operations having an initial term in excess of one year at September 29, 2000 are as follows: - ------------------------------------------------------------------------------- Year - ------------------------------------------------------------------------------- 2001 $5,200 2002 4,400 2003 2,800 2004 1,900 2005 1,700 Thereafter 2,100 - ------------------------------------------------------------------------------- Rental expense attributable to continuing operations under all leases was approximately $6,727, $6,438 and $5,719 for 2000, 1999 and 1998, respectively. The Company makes commitments in a broad variety of areas, including capital expenditures, contracts for services, sponsorship of broadcast media and supply of finished products and components, all of which are in the ordinary course of business. F-11

7 INCOME TAXES Income tax expense (benefit) attributable to continuing operations for the respective years consists of the following: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Current: Federal $ 17 $ 34 $ 56 State 490 683 514 Foreign 6,572 3,489 6,542 Deferred (374) (48) (3,227) - ------------------------------------------------------------------------------- $ 6,705 $ 4,158 $ 3,885 - ------------------------------------------------------------------------------- The significant components of deferred tax expense (benefit) attributable to continuing operations are as follows: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Deferred tax expense (benefit) (exclusive of effects of other components listed below) $ (822) $ 89 $ (2,967) Increase (decrease) in beginning of the year balance of the valuation allowance for deferred tax assets 448 (137) (260) - ------------------------------------------------------------------------------- $ (374) $ (48) $ (3,227) - ------------------------------------------------------------------------------- The tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities attributable to continuing operations at the end of the respective years are presented below: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Deferred tax assets: Inventories $ 1,966 $ 2,557 Compensation 3,502 2,934 Foreign income taxes -- 78 Foreign tax credit carryforwards 3,791 4,051 Net operating loss carryforwards 16,808 12,217 Other 5,869 3,614 - ------------------------------------------------------------------------------- Total gross deferred tax assets 31,936 25,451 Less valuation allowance 7,783 7,183 - ------------------------------------------------------------------------------- 24,153 18,268 - ------------------------------------------------------------------------------- Deferred tax liabilities: Foreign statutory reserves 1,952 1,973 Acquisition accounting 277 300 - ------------------------------------------------------------------------------- Total deferred tax liabilities 2,229 2,273 - ------------------------------------------------------------------------------- Net deferred tax asset $ 21,924 $15,995 - ------------------------------------------------------------------------------- Deferred tax assets relating to net operating losses of discontinued operation of $5,555 has been reflected as assets of continuing operations in 2000 as the benefit will ultimately be realized by the continuing operations. Following is the income (loss) from continuing operations before income taxes for domestic and foreign operations: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- United States $ (1,436) $ (1,269) $ (4,953) Foreign 16,516 11,288 14,217 - ------------------------------------------------------------------------------- $ 15,080 $ 10,019 $ 9,264 - ------------------------------------------------------------------------------- F-12

The significant differences between the statutory federal tax rate and the effective income tax rates for income from continuing operations are as follows: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Statutory U.S. federal income tax rate 34.0% 34.0% 34.0% State income taxes, net of federal income tax benefit 3.8 0.7 (2.2) Foreign rate differential 1.4 5.1 10.6 Change in beginning of year valuation allowance 3.0 -- -- Foreign operating losses (benefit) 0.6 1.9 (1.4) Other 1.7 (0.2) 0.9 - ------------------------------------------------------------------------------- 44.5% 41.5% 41.9% - ------------------------------------------------------------------------------- At September 29, 2000, the Company has $3,791 of foreign tax credit carryforwards available to be offset against future U.S. tax liability. The credits expire in 2000 through 2005 if not utilized. These carryforwards have been fully reserved for in the valuation allowance. At September 29, 2000, the Company has a U.S. federal operating loss carryforward of $28,712 and various state net operating loss carryforwards. During 2000, 1999 and 1998, foreign net operating loss carryforwards were utilized, resulting in a reduction in income tax expense of $152, $137 and $260, respectively. In addition, certain of the Company's foreign subsidiaries have net operating loss carryforwards totaling $1,189. These amounts are available to offset future taxable income over the next 14 to 20 years and are anticipated to be utilized during this period. Taxes paid attributable to continuing operations were $9,935, $6,648 and $6,374 for 2000, 1999 and 1998, respectively. 8 EMPLOYEE BENEFITS Net periodic pension cost for noncontributory pension plans includes the following components. - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Service cost $ 315 $ 273 $ 301 Interest on projected benefit obligation 763 713 697 Less return on plan assets 592 558 520 Amortization of unrecognized: Net loss 4 4 15 Prior service cost 26 26 26 Transition asset (81) (81) (81) - ------------------------------------------------------------------------------- Net amount recognized $ 435 $ 377 $ 438 - ------------------------------------------------------------------------------- The following provides a reconciliation of the changes in the plans benefit obligation and fair value of assets for 2000 and 1999 and a statement of the funded status at the end of each year: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Benefit obligation: Benefit obligation at beginning of year $ 9,604 $ 9,456 Service cost 315 273 Interest cost 763 713 Actuarial (gain) loss 259 (257) Benefits paid (609) (581) - ------------------------------------------------------------------------------- Benefit obligation at end of year $ 10,332 $ 9,604 - ------------------------------------------------------------------------------- Fair value of plan assets: Fair value of plan assets at beginning of year $ 8,070 $ 7,515 Actual return on plan assets 888 860 Company contributions 271 276 Benefits paid (609) (581) - ------------------------------------------------------------------------------- Fair value of plan assets at end of year $ 8,620 $ 8,070 - ------------------------------------------------------------------------------- Funded status: Funded status of the plan $ (1,712) $(1,534) Unrecognized net loss 80 4 Unrecognized prior service cost 148 174 Unrecognized transition asset (291) (372) - ------------------------------------------------------------------------------- Net liability recognized $ (1,775) $(1,728) - ------------------------------------------------------------------------------- F-13

The following summarizes the components of the net liability recognized in the consolidated balance sheets at the end of the respective years: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Prepaid benefit cost $ -- $ 55 Accrued benefit liability (1,775) (1,783) - ------------------------------------------------------------------------------- Net liability recognized $ (1,775) $ (1,728) - ------------------------------------------------------------------------------- Plan assets are invested primarily in stock and bond mutual funds and insurance contracts. Actuarial assumptions used to determine the projected benefit obligation and the net periodic pension cost are as follows: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Discount rate 8% 8% 8% Long-term rate of return 8 8 8 Average salary increase rate 5 5 5 - ------------------------------------------------------------------------------- A majority of the Company's full-time employees are covered by profit sharing and defined contribution programs. Participating entities determine profit sharing distributions under various performance and service based formulas. 9 PREFERRED STOCK The Company is authorized to issue 1,000,000 shares of preferred stock in various classes and series, of which there are none currently issued or outstanding. 10 COMMON STOCK Common stock at the end of the respective years consists of the following: - ------------------------------------------------------------------------------- 2000 1999 - ------------------------------------------------------------------------------- Class A, $.05 par value: Authorized 20,000,000 20,000,000 Outstanding 6,924,630 6,905,297 Class B, $.05 par value: Authorized 3,000,000 3,000,000 Outstanding 1,222,729 1,222,861 - ------------------------------------------------------------------------------- Holders of Class A common stock are entitled to elect 25% of the members of the Board of Directors and holders of Class B common stock are entitled to elect the remaining directors. With respect to matters other than the election of directors or any matters for which class voting is required by law, holders of Class A common stock are entitled to one vote per share while holders of Class B common stock are entitled to ten votes per share. If any dividends (other than dividends paid in shares of the Company) are paid by the Company on its common stock, a dividend would be paid on each share of Class A common stock equal to 110% of the amount paid on each share of Class B common stock. Each share of Class B common stock is convertible at any time into one share of Class A common stock. During 2000, 1999 and 1998, respectively, 132, 1,000 and 4,054 shares of Class B common stock were converted into Class A common stock. 11 STOCK OWNERSHIP PLANS The Company's current stock ownership plans provide for issuance of options to acquire shares of Class A common stock by key executives and non-employee directors. All stock options have been granted at a price not less than fair market value at the date of grant and become exercisable over periods of one to four years from the date of grant. Stock options generally have a term of 10 years. Current plans also allow for issuance of restricted stock or stock appreciation rights in lieu of options. Grants of restricted shares are not significant in any year presented. No stock appreciation rights have been granted. F-14

A summary of stock option activity related to the Company's plans is as follows: - ------------------------------------------------------------------------------- Weighted Average Shares Exercise Price - ------------------------------------------------------------------------------- Outstanding at October 3, 1997 686,521 $18.32 Granted 247,000 17.01 Exercised (10,243) 13.96 Cancelled (321,217) 19.11 - ------------------------------------------------------------------------------- Outstanding at October 2, 1998 602,061 17.43 Granted 353,000 8.53 Cancelled (176,224) 14.67 - ------------------------------------------------------------------------------- Outstanding at October 1, 1999 778,837 14.02 Granted 268,500 7.58 Cancelled (95,107) 15.23 - ------------------------------------------------------------------------------- Outstanding at September 29, 2000 952,230 $12.08 - ------------------------------------------------------------------------------- Other information regarding the Company's stock option plans is as follows: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Options exercisable at end of year 441,544 324,990 257,055 Weighted average exercise price of exercisable options $15.99 18.63 $19.14 - ------------------------------------------------------------------------------- Weighted average fair value of options granted during the year 3.20 3.31 6.82 - ------------------------------------------------------------------------------- At September 29, 2000, the weighted average remaining contractual life of stock options outstanding is approximately 7.6 years. Exercise prices of outstanding stock options range from $6.25 to $25.31 at September 29, 2000. Had compensation cost for the Company's stock options been determined using the fair value method, the Company's pro forma operating results would have been as follows: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Income from continuing operations $ 7,744 $ 5,221 $ 4,776 Diluted earnings per common share from continuing operations $ 0.95 $ 0.64 $ 0.59 - ------------------------------------------------------------------------------- For purposes of calculating pro forma operating results, the fair value of each option grant was estimated using the Black-Scholes option pricing model with an expected volatility of 35%, a risk free rate equivalent to five year U.S. Treasury securities and an expected life of five years. The pro forma operating results reflect only options granted after 1995. The Company's employee stock purchase plan provides for the issuance of up to 150,000 shares of Class A common stock at a purchase price of not less than 85% of the fair market value at the date of grant. During 2000, 1999 and 1998, 16,701, 13,722 and 11,325 shares, respectively, were issued under this plan. 12 RELATED PARTY TRANSACTIONS Various transactions are conducted between the Company and organizations controlled by the Johnson Family. These include consulting services, office rental, royalties and certain administrative activities. Total net costs of these transactions are $542, $474 and $248 for 2000, 1999 and 1998, respectively. 13 SEGMENTS OF BUSINESS The Company conducts its worldwide operations through separate global business units, each of which represent major product lines. Operations are conducted in the United States and various foreign countries, primarily in Europe, Canada and the Pacific Basin. Net sales and operating profit include both sales to customers, as reported in the Company's consolidated statements of operations, and interunit transfers, which are priced to recover cost plus an appropriate profit margin. Identifiable assets represent assets that are used in the Company's operations in each business unit at the end of the years presented. F-15

A summary of the Company's continuing operations by business segment is presented below: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Net sales: Outdoor equipment: Unaffiliated customers $ 103,454 $ 92,367 $ 77,566 Interunit transfers 67 14 28 Watercraft: Unaffiliated customers 84,025 66,461 47,517 Interunit transfers 397 260 266 Diving: Unaffiliated customers 82,246 80,200 90,116 Interunit transfers 5 9 10 Motors: Unaffiliated customers 76,424 64,260 53,249 Interunit transfers 1,363 1,783 1,678 Other 1,139 1,806 1,569 Eliminations (1,832) (2,066) (1,982) - ------------------------------------------------------------------------------- $ 347,288 $ 305,094 $ 270,017 - ------------------------------------------------------------------------------- Operating profit (loss): Outdoor equipment $ 8,182 $ 3,546 $ 1,987 Watercraft 10,327 12,598 8,658 Diving 10,832 4,749 10,193 Motors 3,936 3,497 1,156 Other (8,558) (4,877) (3,638) - ------------------------------------------------------------------------------- $ 24,719 $ 19,513 $ 18,356 - ------------------------------------------------------------------------------- Identifiable assets: Outdoor equipment $ 49,512 $ 47,760 Watercraft 63,394 54,458 Diving 87,818 89,706 Motors 30,208 25,483 Discontinued operations, net -- 56,114 Other 27,039 25,504 - ------------------------------------------------------------------------------- $ 257,971 $ 299,025 - ------------------------------------------------------------------------------- A summary of the Company's continuing operations by geographic area is presented below: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Net sales: United States: Unaffiliated customers $ 232,014 $ 190,743 $ 156,252 Interarea transfers 6,540 6,622 8,427 Europe: Unaffiliated customers 88,213 90,445 91,973 Interarea transfers 7,800 6,510 6,642 Other 27,061 23,906 21,792 Interarea transfers 7,863 5,495 1,737 Eliminations (22,203) (18,627) (16,806) - ------------------------------------------------------------------------------- $ 347,288 $ 305,094 $ 270,017 - ------------------------------------------------------------------------------- Identifiable assets: United States $ 148,186 $ 129,874 Europe 91,684 92,933 Other 18,101 20,104 Discontinued operations, net -- 56,114 - ------------------------------------------------------------------------------- $ 257,971 $ 299,025 - ------------------------------------------------------------------------------- F-16

14 VALUATION AND QUALIFYING ACCOUNTS The following summarizes changes to valuation and qualifying accounts: - ------------------------------------------------------------------------------------------------------------ Additions Reserves of Balance at Charged to Businesses Balance Beginning Costs and Acquired Less at End of Year Expenses or Sold Deductions of Year - ------------------------------------------------------------------------------------------------------------ Year ended September 29, 2000: Allowance for doubtful accounts $3,236 $1,812 $ -- $1,153 $3,895 Reserves for inventory valuation 4,911 853 -- 2,815 2,949 Year ended October 1, 1999: Allowance for doubtful accounts 2,153 2,161 14 1,092 3,236 Reserves for inventory valuation 5,196 801 -- 1,086 4,911 Year ended October 2, 1998: Allowance for doubtful accounts 2,388 734 35 1,004 2,153 Reserves for inventory valuation 6,009 270 120 1,203 5,196 - ------------------------------------------------------------------------------------------------------------ Deductions include the net impact of foreign currency fluctuations on the respective accounts. 15 EARNINGS PER SHARE Basic earnings per share excludes any dilutive effects of options, warrants and convertible securities. Diluted earnings per share is similar to the previously reported fully diluted earnings per share. The following sets forth the computation of basic and diluted earnings per common share: - ------------------------------------------------------------------------------- 2000 1999 1998 - ------------------------------------------------------------------------------- Income from continuing operations for basic and diluted earnings per share $8,375 $5,861 $5,379 - ------------------------------------------------------------------------------- Weighted average shares outstanding 8,139,340 8,108,781 8,100,415 Less nonvested restricted stock 17,265 12,206 5,509 - ------------------------------------------------------------------------------- Basic average common shares 8,122,075 8,096,575 8,094,906 Dilutive stock options and restricted stock 8,208 11,653 18,924 - ------------------------------------------------------------------------------- Diluted average common shares 8,130,283 8,108,228 8,113,830 - ------------------------------------------------------------------------------- Basic earnings per common share from continuing operations $1.03 $0.72 $0.66 - ------------------------------------------------------------------------------- Diluted earnings per common share from continuing operations $1.03 $0.72 $0.66 - ------------------------------------------------------------------------------- 16 LITIGATION The Company is subject to various legal actions and proceedings in the normal course of business, including those related to environmental matters. The Company is insured against loss for certain of these matters. Although litigation is subject to many uncertainties and the ultimate exposure with respect to these matters cannot be ascertained, management does not believe the final outcome will have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company. F-17

17 QUARTERLY FINANCIAL SUMMARY (unaudited) The following summarizes quarterly operating results: - ------------------------------------------------------------------------------------------------------------------------------------ First Quarter Second Quarter Third Quarter Fourth Quarter - ------------------------------------------------------------------------------------------------------------------------------------ 2000 1999 2000 1999 2000 1999 2000 1999 - ------------------------------------------------------------------------------------------------------------------------------------ Net Sales $56,201 $ 48,144 $ 96,703 $ 84,644 $ 114,003 $101,134 $ 80,381 $71,172 Gross profit 21,912 17,811 39,070 34,629 45,337 42,107 28,893 26,123 Operating profit loss 139 (3,121) 9,584 8,288 13,912 13,690 1,084 656 - ------------------------------------------------------------------------------------------------------------------------------------ Income (loss) from continuing operations (1,035) (3,038) 3,896 3,220 5,958 6,359 (444) (680) Income (loss) from discontinued operations (940) 19 -- 1,157 -- 725 -- (740) Loss on disposal of discontinued operations (23,109) -- (1,309) -- -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $(25,084) $ (3,019) $ 2,587 $ 4,377 $ 5,958 $ 7,084 $ (444) $(1,420) - ------------------------------------------------------------------------------------------------------------------------------------ Basic earnings (loss) per common share: Continuing operations $(0.13) $ (0.37) $ 0.48 $ 0.40 $ 0.73 $ 0.79 $ (0.05) $ (0.09) Discontinued operations (2.96) -- (0.16) 0.14 -- 0.09 -- (0.09) - ------------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $(3.09) $ (0.37) $ 0.32 $ 0.54 $ 0.73 $ 0.88 $ (0.05) $ (0.18) - ------------------------------------------------------------------------------------------------------------------------------------ Diluted earnings (loss) per common share: Continuing operations $(0.13) $ (0.37) $ 0.48 $ 0.40 $ 0.73 $ 0.78 $ (0.05) $ (0.09) Discontinued operations (2.96) -- (0.16) 0.14 -- 0.09 -- (0.09) - ------------------------------------------------------------------------------------------------------------------------------------ Net income (loss) $(3.09) $ (0.37) $ 0.32 $ 0.54 $ 0.73 $ 0.87 $ (0.05) $ (0.18) - ------------------------------------------------------------------------------------------------------------------------------------

Exhibit 10.15 Severance Agreement and Release This Severance Agreement and Release ("Agreement") is entered into by and between Johnson Outdoors Inc. (hereinafter referred to as the "Company"), and Carl G. Schmidt ("Executive"). Executive enters into this Agreement on behalf of himself, his spouse, heirs, successors, assigns, executors and representatives of any kind, if any. WHEREAS, Executive's employment with the Company will terminate upon Executive's resignation to be effective on the earlier of September 30, 2000 or the date Executive's successor commences employment with the Company (the "Resignation Date"). WHEREAS, Executive's employment with the Company will terminate upon Executive's resignation as of August 31, 2000, even if no successor has yet commenced employment, provided Executive requests an early release in writing on or before August 1, 2000. If Executive requests this early release, the Resignation Date for purposes of this Agreement shall be September 01, 2000. WHEREAS, the Company will provide Executive with certain additional severance benefits beyond those to which he would otherwise be entitled in exchange for the release of any claims that Executive may have against the Company, specifically including without limitation any claims concerning his employment with the Company or the termination of that employment, and in exchange for Executive's other promises contained in this Agreement. WHEREAS, Executive accepts these additional severance benefits in return for a full release of any claims he might have against the Company and the other promises contained herein. THEREFORE, in consideration of the mutual promises and agreements made herein and the good and valuable consideration described herein, the sufficiency of which is hereby expressly acknowledged, the Company and Executive agree as follows: 1. Non-liability. Neither the Company's signing of this Agreement nor any actions taken by the Company toward compliance with the terms of this Agreement constitute an admission by the Company that it has acted improperly or unlawfully with regard to Executive or that it has violated any state or federal law. 2. Salary and Benefits Continuation. Subject to Executive's strict compliance with the terms of this Agreement and Exhibit A, the Company shall provide severance benefits to Executive as follows: (a) Continuation of Executive's last base salary of $239,900 for the period following the Resignation Date until September 30, 2001 or August 31, 2001 if the Executive requests an early release pursuant to paragraph 3 (the "Severance Period"), and continued health, life, dental, and disability coverage under the Company's plans during the Severance Period. If Executive commences other employment, the Company shall pay the remaining salary continuation payments to Executive in a lump sum within ten (10) days of receiving notification

from Executive of his commencement of new employment. Any portion of such lump sum payment attributable to payments that would otherwise have been made during the fiscal year 1999/2000 or 2000/2001 shall not be considered to be earnings for deferred profit sharing, bonus calculation (except for the 1999/2000 bonus which will be computed against full fiscal year earnings even if other employment is secured and the Executive is removed from the payroll before the end of Fiscal Year 1999/2000), or any other compensation/benefits computation, none of which shall be paid in the circumstances of this lump sum payment. Executive may elect to defer receipt of any lump sum payment until January of the following year, provided that deferral shall not effect the fiscal year to which portions of the lump sum payment are attributable for purposes of this paragraph 2(a). (b) Any accrued but unused vacation time as of the Resignation Date shall be paid within thirty (30) days of the Resignation Date. (c) Continuation of Executive's current benefits during the Severance Period shall include without limitation, except to the extent discounted by reason of a lump sum payment attributable to fiscal years 1999/2000 or 2000/01, as described in paragraph 2(a) above, participation in the (i) 401(k) Retirement and Savings Plan, including Company matching contributions; (ii) Company retirement contributions (sometimes referred to as deferred profit sharing; (iii) Non-qualified Plan, including Company contributions; ; (iv) the Company's health, life, dental and disability coverage plans. (d) Executive outplacement services provided by the Lawrence & Allen firm. The Company shall, prior to the Resignation Date, allow Executive reasonable scheduling flexibility during normal business hours to allow him to utilize such outplacement services or to pursue other alternative employment, but such scheduling must be approved by Helen P. Johnson-Leipold. (e) Use of Company-provided equipment during the Severance Period until Executive accepts new employment. (f) Bonus for current 1999/2000 fiscal year to be based on actual results, computed against full fiscal year base salary earnings. Salary continuation payments during Fiscal Year 2000/2001 will be used to compute Executive's 2000/2001 bonus payout as follows: at target for MBO portion, and the financial portion to be paid at the lesser of actual results or target. (g) All vested and non-vested stock options will expire thirty (30) days after the end of Executive's Severance Period. (h) If at the end of Severance Period Executive has not been offered appropriate new employment, salary continuation (as described in paragraph 2(a)) and benefits continuation (as described in paragraph 2(c)) will be extended by the Company on a month-to-month basis, but not to exceed a total of three (3) additional months. Such salary and benefit continuation shall occur only if Lawrence & Allen certifies to the Company that Executive has made all reasonable and concerted efforts to find and obtain appropriate new employment commensurate with his responsibilities and compensation with the Company. 2

(i) In the event of Executive's death prior to completion of the Severance Period, any remaining salary continuation, bonus or other payments shall be made to Executive's spouse (or in the event of her death to Executive's estate) with coverage also continuing for Executive's spouse and dependants under the Company's health, dental and disability plans for any balance of the Severance Period. 3. Release of All Claims. In consideration for the promises contained in this Agreement, Executive and the Company, including its subsidiary, related and affiliated companies, if any, and its and their past and present directors, officers, employees, agents, shareholders, insurers, attorneys, assigns and other representatives of any kind, (collectively referred to in this Agreement as "Released Parties"), hereby release and discharge one another from any and all claims, liabilities or causes of action of any kind, arising through the date Executive executes this Agreement, including, but not limited to, any claims liabilities or causes of action arising in connection with Executive's employment or termination of employment with the Company, or in any way related to Executive's relationship with the Company or any of the Released Parties. Executive hereby releases and waives any claim or right to further compensation, salary, bonuses, commissions, benefits, damages, penalties, attorneys' fees, costs or expenses of any kind from either the Company or any of the other Released Parties, except as provided herein. Executive and the Company further agree not to file, pursue or participate in any claims, charges, actions or proceedings of any kind against one another or any of the Released Parties with respect to termination of employment, or in any way related to Executive's relationship with the Company or any of the Released Parties (other than for enforcement of this Agreement or pursuing a claim for unemployment compensation benefits to which Executive may be entitled). Executive's release of the Company and the Released Parties specifically includes, but is not limited to, a release of any and all claims under state or federal wage payment laws; state and local fair employment law(s); the Wisconsin Fair Employment Act; Title VII of the Civil Rights Act of 1964; Section 1981 of the Civil Rights Act of 1866; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967; the Older Workers Benefit Protection Act of 1990; the Americans With Disabilities Act; state or federal family and /or medical leave acts; the Consolidated Omnibus Budget Reconciliation Act of 1985; the Employee Retirement Income Security Act of 1974; and any other federal, state or local laws or regulations of any kind, whether statutory or decisional. This release also includes, but is not limited to, a release of any claims for wrongful termination, tort, breach of contract, defamation, misrepresentation, violation of public policy or invasion of privacy. 4. Covenant Not To Sue. Executive and the Company represent that neither has brought, and each respectively covenants and agrees not to bring or cause to be brought, any charges, claims, demands, suits or actions in any forum, against one another or any of the Released Parties, arising out of, connected with or related in any way to Executive's dealings with the Company or any of the Release Parties that occurred prior to the effective date of this Agreement, including, without limitation, Executive's employment or the termination of that employment; provided, however, that neither party shall be prevented from enforcing the terms of this Agreement. In the event that Executive brings an action to invalidate this Agreement, Executive covenants and agrees that prior to the commencement of such action, he shall tender back to the Company all consideration paid to him pursuant to the terms of this Agreement up to 3

the date such action is instituted. Executive acknowledges and understands that all non-vested Company benefits provided under this Agreement will also cease as of the date such action is instituted and that no further consideration or benefits will be provided by the Company during the pendency of such action. 5. Confidentiality. Executive acknowledges that during the course of his employment with the Company, he has been entrusted with certain personnel, business, financial, technical, sales, marketing, customer and other proprietary information and materials which are the property of the Company and which involve confidential information concerning the Company's products, dealings, strategies, plans and employees. Executive agrees that during the Severance Period and the two (2) years following the Severance Period, he will not communicate or disclose to any third party, or use for his own account or benefit or for the benefit of any other person or entity, without the prior written consent of the Company, any of the above-mentioned information or material, except as required by law, unless and until such information or material has become generally available to the public through no fault of Executive's. In the event the disclosure of such information is required by law, Executive agrees that he will give immediate written notice to the Company so as to enable it to seek an appropriate protective order. This confidentiality obligation is undertaken in addition to Executive's other confidentiality obligations to the Company, for example, pursuant to the MANAGEMENT EMPLOYEE AGREEMENT and the POLICY GUIDELINES ON STANDARDS OF BUSINESS CONDUCT AND LEGAL COMPLIANCE, all of which survive and remain in full force and effect. 6. Noncompetition. During the Severance Period, Executive promises that he shall not provide any services as employee, consultant or otherwise, that are similar to those services he provided to the Company as Chief Financial Officer, to, for or on behalf of any entity that is listed in Exhibit B by its commonly known name, or any affiliate of those entities. 7. Notice of Employment/Agreement. For a period of two (2) years from the date of this Agreement, Executive shall notify the Company, prior to accepting employment or other engagement, of the identity of the new employer or contracting party and the nature of the proposed employment duties or services. Such notice must be in writing and must be faxed and mailed to the Company's Chief Executive Officer. 8. Return of Company Property and Information. (a) Executive represents that he has returned or will return no later than the Resignation Date, to the Company the originals and all copies of any business records or documents of any kind belonging to, or related to, the Company, regardless of the sources from which such records were obtained, together with all notes and summaries relating thereto. Additionally, Executive shall return to the Company no later than the Resignation Date all keys, security passes and other means of access to the Company's offices and other facilities. (b) Executive represents that he shall also promptly return to the Company any and all computer software belonging to the Company, including any and all program and/or data disks, manuals and all hard copies of Company information and data, and shall disclose to the Company any and all passwords utilized by Executive with regard to the Company's computer system, hardware and software so that the Company has immediate, full and complete 4

access to all of the Company's data and information stored, used and maintained by Executive, or to which Executive had access. Executive will be allowed to retain his computer and its peripheral equipment. 9. Disclosure of Any Noncompliance. Executive acknowledges and agrees that it is the Company's policy, communicated to him and other Executives, that Executives are required to bring to the Company's attention any incidents of misconduct or wrongdoing in the area of regulatory compliance, both governmental and industry. Executive hereby affirms that he has acted in accordance with such policy and that he has no knowledge of any such incident which he has not previously brought to the attention of the Company in writing. 10. Assistance. Executive shall, for a period of three years after the date of this Agreement, provide all reasonable assistance to the Company that may be requested by the Company for the investigation and/or defense of claims made against the Company that in any way refer or relate to any of Executive's areas of responsibility for the Company. Additionally, during the Severance Period Executive shall provide reasonable assistance as requested by the Company to facilitate a smooth transition of Executive's former job duties. The Company shall reimburse Executive for all reasonable out of pocket expenses incurred by Executive in the provision of such assistance. 11. Intellectual Property. Executive agrees that all ideas, inventions, trade secrets, know-how, documents and data of any kind developed in connection with or pursuant to his employment with the Company, is and shall remain the exclusive property of the Company. 12. Non-disparagement. Executive shall not disparage, discredit or otherwise refer to the Company or any individual members of its Executive Committee in a detrimental or negative manner. Similarly, the Chairman and his/her direct reports shall not disparage, discredit or otherwise refer to Executive in a detrimental or negative manner. If it is judicially determined that the Executive has violated this Section 12 of the Agreement, and that the Company has been materially damaged thereby, he shall repay to the Company the benefits received pursuant to paragraph 2 of this Agreement and shall be required to reimburse the Company for all of its costs, including reasonable attorneys' fees. If it is judicially determined that Executive has not violated this paragraph 12, or that the Company has not been materially damaged by any alleged violation, the Company shall be required to reimburse Executive for all of his costs of defending such action, including reasonable attorney's fees. 13. Confidentiality of this Agreement. Executive agrees to keep the terms of this Agreement completely confidential, to the extent such information is not required to be disclosed in public documents of the Company, except that he may share the information with his immediate family, attorney or tax advisor, if any, and Lawrence & Allen, who will also be bound by this confidentiality provision. 14. Sole Inducement. In order to induce the Company to provide him the consideration recited in this Agreement, Executive voluntarily executes this Agreement, acknowledges that the only consideration for executing this Agreement is that recited herein, and that no other promise, inducement, threat, agreement or understanding of any kind has been made by anyone to cause him to execute this Agreement. Executive understands that he has a 5

right to seek advice of counsel (at his own expense) regarding this Agreement, and Executive confirms that he has consulted with and received the advice of an attorney of his choice. 15. Rights to Consider and Revoke. Executive hereby acknowledges that the benefits provided for in this Agreement are greater than those to which he otherwise would be entitled by any contract, employment policy, or otherwise. Executive further acknowledges that he is entering into this Agreement voluntarily, that he has had more than twenty-one (21) days to consider the provisions set forth in this Agreement, or has voluntarily waived the twenty-one (21) day consideration period upon advice of counsel, and that he has been advised to seek advice of counsel regarding this Agreement prior to signing it. For a period of seven (7) days following his signing of this Agreement, Executive may revoke this Agreement by doing so in writing, and this Agreement will not become enforceable or effective until the revocation period has expired. 16. Effect of Breach. In the event that a court of competent jurisdiction determines that Executive has materially breached any of the promises contained in this Agreement, the Company shall be entitled, as of the date of the material breach, to immediately terminate, and be relieved of making, all remaining severance payments and other benefits. Any such termination, however, shall not relieve Executive of any of the obligations contained in this Agreement, all of which shall remain in full force and effect. 17. Attorneys' Fees. In the event that a court of competent jurisdiction determines that either party has materially breached this Agreement, in addition to any damages awarded, the breaching party shall pay the non-breaching party's reasonable attorneys' fees and costs incurred in each and every such action, suit or other proceeding, including any and all appeals or petitions therefrom. Notwithstanding the foregoing, any action for violation of paragraph 12 of this Agreement shall be subject to the provisions provided therein with respect to fees, costs and damages. 18. Resignation Announcement. The Company and Executive agree that any public announcement of Executive's resignation shall be mutually agreed upon as to both contents and timing prior to its release. 19. Entire Agreement. This Agreement sets forth the entire agreement between the Company and Executive and supersedes all prior oral and written agreements between the parties except any restrictive covenants which remain binding on the Executive. This Agreement cannot be amended or modified, except in writing signed by Executive and agent of the Company specifically authorized to sign on behalf of the Company in this matter. 20. Severability. If any portion of this Agreement is found to be unenforceable, all other portions that can be separated from it, or appropriately limited in scope, shall remain fully valid and enforceable. 21. Execution. This Agreement, or any amendment hereto, may be signed in any number of counterparts, including counterparts signed and delivered by fax transmission, each of which shall be and deemed an original, but all of which taken together shall constitute one agreement (or amendment as the case may be). 6

EXECUTIVE FULLY UNDERSTANDS THE MEANING AND INTENT OF THIS AGREEMENT AND ITS FINAL AND BINDING EFFECT ON HIM. IN WITNESS WHEREOF, Executive and the Company, by its duly authorized agent, have each placed their signatures on the dates indicated below. /s/ Carl G. Schmidt Date: 6/9/00 - ---------------------------------------------- ------ Carl G. Schmidt JOHNSON OUTDOORS INC. By /s/ Helen P. Johnson Leipold Date: 6/9/00 ------------------------------------------- ------ Helen P. Johnson-Leipold Chairman and Chief Executive Officer 7

Exhibit A TRANSITION EXPECTATIONS BEHAVIORS o Outwardly exhibits no behaviors that would indicate you are leaving (i.e. - maintain positive demeanor with all employees), except to the extent agreed to by the Company as necessary to transition job duties and responsibilities. o In concert with above, maintains a positive outlook with any external contacts and has no discussion regarding upcoming separation from the Company. BUSINESS EXPECTATIONS o All financial reporting obligation timelines continue to be met, as well as other reasonable projects as assigned by Helen. o Regarding any key external contacts that you have developed strong relationships with, that you facilitate a transition of said contacts to Helen or others, as assigned by Helen, in a manner that would not raise questions regarding your upcoming resignation. o You make yourself available to your replacement, upon reasonable notice and at reasonable times as mutually agreed between yourself and your replacement, while you are under salary/benefit continuation or after any lump sum payment, for a maximum of five days in the 45-day period after your replacement starts employment. o You agree to and understand, that at the sole discretion of Helen, that you may be excluded from future meetings during your period of "active employment". o You agree to attend and actively participate in all Investor Relations presentations during the period of "active" employment. 8

EXHIBIT B Coleman Watermark Mares Brunswick K-2 Aqualung Northface VF Corporation Suunto Confluence Pelican 9

EXHIBIT 21 JOHNSON WORLDWIDE ASSOCIATES, INC. AND SUBSIDIARIES The following lists the principal direct and indirect subsidiaries of Johnson Worldwide Associates, Inc. as of September 29, 2000. Inactive subsidiaries are not presented. Jurisdiction in Name of Subsidiary (1)(2) which Incorporated - ------------------ ------------------ Johnson Worldwide Associates Australia Pty. Ltd. Australia Johnson Worldwide Associates Canada Inc. Canada Plastiques L.P.A. Limitee Canada Old Town Canoe Company Delaware Leisure Life Limited Michigan Extrasport, Inc. Florida Scubapro Scandinavia AB Sweden Under Sea Industries, Inc. Delaware JWA Holding B.V. Netherlands Johnson Beteiligungsgesellschaft GmbH Germany Jack Wolfskin Ausrustung fur Draussen GmbH Germany Johnson Outdoors V GmbH Germany Scubapro Taucherauser GmbH Germany Uwatec AG Switzerland Uwatec USA, Inc. Maine Uwatec Asia, Ltd. (3) Hong Kong Uwatec Batam Indonesia Uwaplast AG Switzerland Scubapro Asia, Ltd. Japan Scubapro Espana, S.A.(4) Spain Scubapro Eu AG Switzerland Scubapro Europe Benelux, S.A. Belgium JWA France France Scuba/Uwatec S.A. France Scubapro Europe S.r.l. Italy Scubapro Italy S.r.l. Italy Scubapro (UK) Ltd.(5) United Kingdom Pacific Kayak Ltd. New Zealand - ------------------- (1) Unless otherwise indicated in brackets, each company does business only under its legal name. (2) Unless otherwise indicated by footnote, each company is a wholly-owned subsidiary of Johnson Worldwide Associates, Inc. (through direct or indirect ownership). (3) Percentage of stock owned is 60%. (4) Percentage of stock owned is 98%. (5) Percentage of stock owned is 99%.

EXHIBIT 23 CONSENT OF KPMG LLP Board of Directors Johnson Outdoors Inc.: We consent to incorporation by reference in the Registration Statements (Nos. 33-19804, 33-19805, 33-35309, 33-50680, 33-52073, 33-54899, 33-59325, 33-61285, 333-88089 and 333-88091) on Form S-8 of Johnson Outdoors Inc. of our report dated November 6, 2000, relating to the consolidated balance sheets of Johnson Outdoors Inc. and subsidiaries as of September 29, 2000 and October 1, 1999, and the related consolidated statements of operations, shareholders' equity, and cash flows for each of the years in the three-year period ended September 29, 2000, which report appears in the 2000 Annual Report on Form 10-K of Johnson Outdoors Inc. KPMG LLP Milwaukee, Wisconsin December 28, 2000

5 THE SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF JOHNSON WORLDWIDE ASSOCIATES, INC. AS OF AND FOR THE YEAR ENDED SEPTEMBER 29, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 YEAR SEP-29-2000 OCT-02-1999 SEP-29-2000 17,363 0 58,720 (3,895) 62,708 144,194 103,720 (66,351) 257,971 106,403 45,857 0 0 407 100,425 257,971 346,458 347,288 197,990 212,076 0 1,812 9,799 15,080 6,705 8,375 (25,358) 0 0 (16,983) (2.09) (2.09)