GA-3

Prepared K.E;M.B.(1/13/2012)

Apollo Shoes, Inc.

Relevant Matters Based on Minutes (December 31, 2011)

Information Relevant to 2010 Audit

1. Remarks by Apollo Shoes Inc. CEO Larry Lancaster in regards to the 10% projected increase in sales for the 2011fiscal year. (“Well they better increase by that much or heads will roll.”) GA-3.1 2. Majority vote by members of the board to internalize product production GA-3.1 3. $90,000 stipend awarded to outside Board Members GA-3.1 4. Refinancing of short-term credit GA-3.1 5. $ 50,000 in damages due to April snowstorm GA-3.2 6. Discontinuation of Research and …show more content…

VP and CFO, Joe Bootwell 1,320,000 VP Marketing, Fred Durkin 1,100,000 VP Finance, Eric Unum 649,000 VP Legal Affairs, Sue Fultz 1,650,000 VP Operations, Daisy Gardner 451,000 Internal Audit Director, Karina Ramirez 235,000 Treasurer, Mary Costain 222,000 Controller, Samuel Carboy 214,000

Mr. Lancaster encouraged everyone to watch the 2011 Superbowl to watch for Apollo’s 15- second commercial. He noted that the cost of the commercial time rose approximately 10% from last year. The cost of production and airing the ad is now approaching $1,000,000.

Meeting ended 5:30 p.m. /s/ Jeff Chesnut, Secretary

GA-3.2

Meeting Held June 30, 2011

Larry Lancaster, chairman of the board, presided over the second meeting of the year, beginning at 3 p.m. All members were present:

Larry Lancaster Josephine Mandeville** Fritz Brenner** Ivan Gorr* Theodore Horstmann** Harry Baker* Eric Unum

* Outside director ** Outside director and member of the audit committee.

The minutes of the January 5 meeting were reviewed and approved.

Mr. Lancaster reported on damage caused by a “Nor’easter” storm that hit Shoetown in April. Damages amounted to approximately $50,000, just under the insurance deductible.

Mr. Unum reported that sales