8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 22, 2006

LaCROSSE FOOTWEAR, INC.

(Exact name of registrant as specified in its charter)

Wisconsin	0-23800	39-1446816
(State or other jurisdiction of incorporation)	(Commission file number)	(IRS employer identification number)

17634 NE Airport Way, Portland, Oregon 97230
(Address of principal executive offices, including zip code)

(503) 262-0110
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

2007 Incentive Compensation Program

On December 20, 2006, the Board of Directors of LaCrosse Footwear, Inc. (the “Company”) approved the Company’s 2007 incentive compensation program (the “Incentive Program”). Executive officers and other employees who meet certain conditions will be eligible to participate in the Incentive Program. The Incentive Program provides for payment of incentive compensation equal to a percentage of the employee’s base earnings. If Company goals are met, the employee will receive 100% of target incentive compensation. The percentage of annual base earnings that is paid as incentive compensation increases in the event the Company achieves greater than 100% of the goals. The Incentive Program is based on minimum threshold levels for revenue growth, operating profit, and inventory turns. In addition, if the operating profit minimum threshold is not met, there can be no incentive payment. The Incentive Program description as distributed to the Company’s non-union employees is included as Exhibit 10.1 to this Current Report and is incorporated herein by reference. The foregoing description of the Incentive Program does not purport to be complete and is qualified in its entirety by reference to such exhibit.

2007 Compensation of Executive Officers

On December 20, 2006, the Company’s Board of Directors approved the 2007 salary, incentive compensation and equity compensation for the Company’s executive officers.

Effective January 1, 2007, the annual base salary of Joseph P. Schneider, the Company’s President and Chief Executive Officer, was set at $425,000. Mr. Schneider will be eligible to receive additional compensation under the Incentive Program as described in the first paragraph of this Current Report. If 100% of the Incentive Program goals are achieved, Mr. Schneider will be eligible to receive incentive compensation equal to 100% of his 2007 annual base earnings. Effective January 2, 2007, Mr. Schneider will be awarded a stock option exercisable for 20,250 shares of the Company’s common stock at an exercise price equal to the closing price of the Company’s common stock on January 2, 2007.

Effective January 1, 2007, the annual base salary of David P. Carlson, the Company’s Executive Vice President and Chief Financial Officer, was set at $296,000. Mr. Carlson will be eligible to receive additional compensation under the Incentive Program as described in the first paragraph of this Current Report. If 100% of the Incentive Program goals are achieved, Mr. Carlson will be eligible to receive incentive compensation equal to 70% of his 2007 annual base earnings. Effective January 2, 2007, Mr. Carlson will be awarded a stock option exercisable for 15,000 shares of the Company’s common stock at an exercise price equal to the closing price of the Company’s common stock on January 2, 2007.

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ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits

Exhibit No.	Description
10.1	LaCrosse Footwear, Inc. 2007 Annual Incentive Compensation Plan Document

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed by the undersigned thereunto duly authorized.

	LaCROSSE FOOTWEAR, INC.
Dated: December 22, 2006
	By:	/s/ David P. Carlson
		David P. Carlson
		Executive Vice President and Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Description
10.1	LaCrosse Footwear, Inc. 2007 Annual Incentive Compensation Plan Document

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EX-10.1

Exhibit 10.1

LaCrosse Footwear Inc.

2007 Annual Incentive Compensation Plan Document

Objective/Overview

The LaCrosse Footwear Inc. incentive compensation program is designed to reward performance based on the achievement of desired annual corporate results. The LaCrosse incentive compensation program seeks to drive positive performance by targeting our greatest opportunity to increase shareholder value, which we’ve identified as profitable sales growth while maintaining a healthy balance sheet. The financial metrics for 2007 are sales growth, profitability and inventory turns.

LaCrosse funds the Incentive Compensation Plan solely from Company profits. The Company must achieve at least 75% of planned/budgeted 2007 operating profit dollars in order for any Incentive Compensation payout, regardless of the achievement of any other performance metric.

The guidelines for the 2007 Incentive Compensation Plan are as follows:

Plan Year and Eligibility Requirements

The incentive compensation measurement plan year runs from January 1^st through December 31^st. All non-union LFI employees are eligible for the Incentive Compensation Plan unless the individual is on a Sales Commission Plan. No employee can be on more than one incentive compensation plan. Employees hired during the Plan year are eligible effective with their date of hire. The actual incentive compensation payout, if any, is based on actual base pay wages (excludes overtime earnings and bonus payments) paid during the calendar year.

The employee must be actively employed by the Company on the payment date in order to receive any incentive compensation. Incentive compensation is not earned until paid. Payment date is anticipated to be by the end of the first quarter of the following year, but is at the discretion of the Company. An employee must have a minimum individual performance rating of “3” to be eligible to receive any incentive compensation payout. An employee whose last overall performance rating is “1” or a “2” will not be eligible to receive incentive compensation. Any employee on a written warning at the time of the incentive compensation payment is also ineligible.

An individual’s incentive target compensation is set as a percentage of annual base pay earnings. The incentive target compensation level for each employee is commensurate with his or her duties and responsibilities within the organization. The target levels are reviewed annually and employees are notified of any changes.

Communication

To assure the success of our incentive compensation plan, we will inform each participant of their target compensation percentage and the specific corporate performance targets. In addition, we will provide an update of the Company’s operating results and incentive compensation targets on a quarterly basis.

Company’s Discretion

The Company has full authority to modify, change, amend or terminate this plan at its complete discretion.

FINANCIAL COMPONENT

     The financial component or metric will be computed at the Corporate level as follows:

40%	revenue growth variances (for manufacturing department only)
40%	operating profit
20%	inventory turns

40% — REVENUE GROWTH

Incentive payouts will be computed according to Net Sales as reported.

Results versus Goal	Incentive Compensation Amount
< 95% of budget net sales dollars	No incentive compensation
Equal to or > 95% of budget net sales dollars	Based on an incremental scale. There is no cap.

Exception: Portland Manufacturing has incentive compensation based on targeted variances in-lieu of the revenue growth factor. There is a payout cap of 120% of variance target.

40% — OPERATING PROFIT

Incentive payouts will be computed according to Operating Income as reported.

Results versus Goal	Incentive Compensation Amount
< 75% of budget operating income dollars	No incentive compensation
Equal to or >75% of budget operating income $	Based on an incremental scale. There is no cap.

20% — INVENTORY TURNS

Inventory turns will be based on the number of inventory turns computed for the full fiscal year and will be equal to standard COGS (no variances) for the year divided by average inventory. Average inventory will equal the sum of each month ending inventory divided by 12.

Results versus Goal	Incentive Compensation Amount
< 85% of budgeted inventory turns	No incentive compensation
Equal to or > 85% of budget inventory turns	Based on an incremental scale. There is no cap.

Extraordinary Items and Board of Director Approval:

Extraordinary items will be evaluated by the Compensation Committee on a case-by-case basis as to the impact on incentive compensation. The definition of extraordinary items are items/events which are non-recurring and are not reflective of the on-going operation of the business as well as considered beyond management control.

LFI’s Board of Directors and Management reserves the right to change, alter, terminate, or modify this incentive compensation program as the business environment changes, or is deemed necessary. All payments are subject to Compensation Committee approval, after year-end financial statements have been audited.

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End of Filing