SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
Filed by the registrant [ ]
Filed by a party other than the registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
--------------------------------------------------------------------------------
NAUTICA ENTERPRISES, INC.
(Name of Registrant as Specified in Its Charter)
--------------------------------------------------------------------------------
BARINGTON COMPANIES EQUITY PARTNERS, L.P.,
JEWELCOR MANAGEMENT, INC., RCG AMBROSE
MASTER FUND, LTD. and RAMIUS SECURITIES, LLC
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
--------------------------------------------------------------------------------
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing
fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
1
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
2
PRELIMINARY COPY; SUBJECT TO COMPLETION
DATED _________, 2003
2003 ANNUAL MEETING OF
STOCKHOLDERS OF NAUTICA ENTERPRISES, INC.
PROXY STATEMENT
OF
THE BARINGTON COMPANIES GROUP
This proxy statement and the enclosed GREEN proxy card are being
furnished to you, the holders of shares of common stock, par value $.10 per
share, of Nautica Enterprises, Inc., a Delaware corporation, in connection
with the solicitation by Barington Companies Equity Partners, L.P. and other
entities participating with Barington Companies Equity Partners, L.P. for use
at the 2003 annual meeting of stockholders of the Company, and at any
adjournments or postponements of the meeting. The other entities
participating with Barington Companies Equity Partners, L.P. are Jewelcor
Management, Inc., RCG Ambrose Master Fund, Ltd. and Ramius Securities, LLC
who, together with Barington Companies Equity Partners, L.P., are referred to
as the Barington Companies group.
This Proxy Statement and the accompanying GREEN proxy card are first
being furnished to the Company's stockholders on or about ___________, 2003.
The Barington Companies group is soliciting proxies to obtain
representation on the Company's board of directors. Our goal is to elect
two new and independent members to the Company's board of directors who will
help guide the Company's board of directors in its pursuit to maximize
shareholder value. The term independent as used in this Proxy Statement
means the absence of any material relationship with the Company. Our
nominees, William J. Fox and James A. Mitarotonda , are highly-qualified
candidates who possess significant retail and consumer products industry,
operating and financial experience. We believe that the value-added insight,
energy and objectivity of our nominees will benefit the Company's existing
board of directors in executing its strategic plan.
In connection with our solicitation of proxies for board
representation, we are not seeking to replace the entire board of
directors. However, we believe that there is limited independent
shareholder representation on the current board of directors. In fact, the
Company has announced in its proxy materials for the 2003 annual meeting that
it "plans to name two new independent directors by the 2004 annual meeting."
We are seeking additional, independent representation on the Company's
board not next year, but now. We believe that the Company's board currently
needs more independent voices to represent the interests of all
stockholders. Moreover, we believe that the operating skills and managerial
experience of our nominees will promote the maximization of shareholder value.
A vote in favor of our proposals at the 2003 annual meeting will result
in the election of a complete eight member board of directors, consisting of
our two nominees and six of the incumbent members of the board of
directors. Our nominees, if elected, look forward to
1
working with the other members elected to the Company's board at the 2003 annual
meeting, in our efforts to produce the maximum value for all the Company's
stockholders.
In our view, the current board of directors has failed to adequately
address certain operational issues at the Company including a significant
expense base, ineffective management of the Nautica brand and an unproven
brand expansion and diversification strategy that has required significant
capital investments. We believe these operational issues have reduced the
Company's competitiveness and diluted the value of the Nautica brand in the
retail marketplace. Although we support a number of the initiatives the
current board of directors has taken in executing its strategic plan, we
believe that their efforts to date have not produced the enhancements to
shareholder value expected by stockholders. As a result, the Company's stock
price has fallen approximately 47.2% during the two-year period ended June 6,
2003.
Given the operating challenges which the Company continues to confront,
we felt that it was imperative to seek your support for a slate of
highly-qualified nominees who intend to advocate the interests of all
stockholders and work with those members of the Company's board of directors
elected at the 2003 annual meeting in order to effectuate a plan that we
believe will maximize shareholder value. Otherwise we would risk an
unacceptable delay of a full year before our nominees could increase the
number of independent members on the Company's board and present our proposed
initiatives to enhance shareholder value to the Company's stockholders .
We believe the Company must promptly implement the following measures
in order to enhance shareholder value:
o reduce operating expenses in order to improve profitability and
enhance cash flow;
o formulate a more cohesive operating strategy to bolster its Nautica
brand;
o review the Company's use of capital in order to maximize returns on
equity;
o restructure executive compensation packages so that the interests of
executive officers are aligned with those of the Company's
stockholders and such individuals are rewarded for improvements in
shareholder value;
o review change of control provisions in certain Company contracts that
may have the effect of limiting shareholder value; and
o explore value-enhancing strategic initiatives, including the possible
sale or merger of the Company.
Our nominees for director support these proposed actions and, if
elected, will seek to implement them.
In addition, our nominees, if elected, intend to advocate a series of
actions to promote corporate democracy and place control of the Company
firmly in the hands of stockholders acting by majority vote. These actions
include eliminating the stockholder rights plan adopted by the current board
and allowing stockholders to act by written consent.
2
We believe the following operating problems and strategic issues will
persist unless appropriate action is taken by the board of directors
immediately:
o significant selling, general and administrative expenses that have not
been addressed by current senior management in light of the Company's
reduced business prospects. The Company continues to invest in brand
expansion initiatives, including marketing efforts and build-out of
retail locations, which we believe have yet to yield positive results
for stockholders.
o unsuccessful development of a strategic plan by current senior
management to improve persistent revenue stagnation within the
Company's men's sportswear business and underperformance of its
women's business. According to the Company's Form 10-K for fiscal year
2003, its men's sportswear line experienced a 9.2% decline in net
sales from fiscal year 2002 to fiscal year 2003 and is expected to
experience an additional decline of approximately 13% to 15% in fiscal
year 2004. Similarly, based on statements made by the Company during
its earnings conference call on May 1, 2003, its women's jeans and
women's Earl Jean businesses are performing below profitability levels
targeted by management.
o inefficient deployment of capital by current senior management in its
efforts to execute a brand expansion and diversification strategy that
has been slow to yield returns to stockholders. Based on an expected
after-tax charge of $6.0 million to $7.0 million announced by the
Company in a press release dated April 7, 2003, we believe that the
Company's attempt to develop the Nautica Europe business has not
enhanced shareholder value. Similarly, the Company's attempt to
enhance its retail exposure by opening a store in Rockefeller Center
has proven unsuccessful, resulting in an after-tax charge of $6.5
million in fiscal year 2003. The Company, in fact, acknowledged in its
May 1, 2003 earnings conference call, that it is remerchandising this
store in an effort to drive traffic at this location. Further, as part
of a brand diversification strategy, in 2001 the Company acquired Earl
Jean, Inc., an upscale denim brand for approximately $65 million,
which to date, in our view, has not yielded positive returns for
stockholders. In addition, based on our discussions with the Company's
management, its John Varvatos business, which was launched in 2000,
has not performed at desired levels.
o executive compensation packages which contain payment terms that are
not aligned with the interests of the Company's stockholders; and
o change of control provisions in certain contracts to which the Company
is a party which, if triggered, could misalign the interests of the
board of directors and stockholders and potentially limit shareholder
value.
For these reasons, we are appealing directly to you -- the owners of
the Company -- and asking you to vote your shares at the 2003 annual meeting
in a way that sends the Company's current board of directors a clear message
that you want to hold the board of directors accountable to you in fulfilling
its fiduciary duty to enhance the value of the Company for all stockholders.
In order for shareholder value to be maximized, the Company's operating
results
3
must be addressed at once. Our nominees intend to focus their efforts on the
foregoing issues to improve the Company's performance and drive shareholder
value.
At the 2003 annual meeting, we intend to seek your support for two
highly-qualified and independent nominees for election to the Company's board
of directors, William J. Fox and James A. Mitarotonda . These individuals
possess strong operating, industry and financial skills that should benefit
the Company in implementing its strategic plan. Moreover, these individuals
will bring to the board additional independent voices that will represent the
interests of all stockholders. We believe that the election of our
nominees to the Company's board of directors, although only a minority of
the eight-person board of directors, will help guide the Company's board of
directors to fulfill its fiduciary duty to maximize value for all
stockholders.
We also intend to vote the shares of common stock represented by the
proxy to re-elect all of the Company's incumbent directors other than
Charles H. Scherer and John Varvatos. Both of these individuals lack
independence from the Company which we believe this board needs more of and
that stockholders should demand.
A vote in favor of our proposals at the 2003 annual meeting will result
in the election of a complete eight member board of directors, consisting of
our two nominees and six of the incumbent members of the board of
directors.
In addition to the election of directors, we are proposing to amend the
Company's By-laws to allow stockholders who own 10% or more of the Company's
outstanding common stock to call a special meeting of stockholders.
The Barington Companies group recommends that you vote
o to elect each of our nominees and re-elect all the incumbent
directors
other than Messrs. Scherer and Varvatos; and
o to adopt our proposed amendment to the Company's By-laws.
See "The Proposals" for a complete description of the actions that we
propose. See "Information About The Barington Companies Group" and "Certain
Other Information Regarding The Barington Companies Group Nominees" for
information about the Barington Companies group and about our nominees.
The Company has announced that the 2003 annual meeting will be held at
10:00 a.m. Eastern daylight time on July 8, 2003 at the offices of the
Company, 40 West 57th Street, New York, New York, 7th floor and that the
record date for determining stockholders entitled to notice of and to vote at
the 2003 annual meeting is May 29, 2003.
Your vote is important, no matter how many or how few shares of common
stock you own. The Barington Companies group urges you to mark, sign, date
and return the enclosed GREEN proxy card promptly in accordance with the
instructions set forth below. Please do NOT sign any proxy card you may
receive from the Company even though it may contain one or more of the
Barington Companies group's proposals.
4
You are urged to mark, sign and date the enclosed GREEN proxy card
and return it in the enclosed envelope whether or not you plan to attend the
2003 annual meeting. If you need assistance in voting your shares of common
stock, please call the Barington Companies group's proxy solicitor, D.F. King
& Co., Inc., toll-free at 1-888-869-7406 or if you are a bank or broker
please call collect at 1-212-269-5550.
INTRODUCTION
The Barington Companies group seeks to maximize value for all of the
Company's stockholders. The Barington Companies group does not believe that
the current board of directors and management have fulfilled their
obligations to the stockholders of the Company to achieve this goal.
Further, we believe that the current board of directors contains a limited
number of independent members focussed on representing the interests of all
stockholders and advocating the maximization of shareholder value. As a
result, we believe that the current board of directors has been slow to
address persistent operational issues at the Company, such as a high
expense base, ineffective development of the Nautica brand and an unproven
brand expansion and diversification strategy, which, in our opinion, have
been detrimental to stockholders. In addition, we believe that the board of
directors has approved certain contracts to which the Company is a party
containing change of control provisions which may have the effect of limiting
the rights of stockholders and have the potential to misalign the interests
of the board of directors and stockholders. In our opinion, these missteps
have weakened the Company's competitive position and diluted the value of the
Nautica brand in the retail marketplace.
These actions by the current board of directors and management, coupled
with the limited number of independent board members, in our view, have
resulted in a material reduction in shareholder value. From June 6, 2001 to
June 6, 2003, a period during which the Company made a significant investment
in implementing its brand expansion and diversification strategy, the
Company's stock price fell approximately 47.2% from $20.07 per share to
$10.60 per share. During the same period, the stock price of four of the
Company's competitors named in the Company's most recent Form 10-K, Kenneth
Cole Productions Inc., Liz Claiborne, Inc., Polo Ralph Lauren Corporation and
Tommy Hilfiger Corporation experienced percentage changes of (28.0)%, 32.5%,
(6.7)% and (38.6)%, respectively. The Company's return on equity, defined as
net income, excluding special charges, divided by stockholders' equity, fell
from 16.2% in fiscal year 2001 to 8.9% in fiscal year 2003, based on
information contained in the Company's Form 10-K for fiscal year 2003.
Under the leadership of the current board of directors and senior
management, we believe the Company has:
o been slow to establish an appropriate cost structure in light of the
Company's reduced business prospects. According to the Company's
Form 10-K for fiscal year 2003, selling, general and administrative
expenses as a percentage of net sales increased to approximately
36.7% in fiscal year 2003 from approximately 31.4% in fiscal year
2001. During the same period, total headcount increased 15.8% from
2,850 to 3,300, according to the Company's Form 10-K for fiscal
years 2001 and 2003. As a result of the Company's sluggish revenue
growth during the last two fiscal years, operating profit, excluding
special charges, as a percentage of net sales, fell from
approximately
5
11.5% in fiscal year 2001 to approximately 7.3% in fiscal year 2003.
According to statements made by the Company during its earnings
conference call on May 1, 2003, the Company expects selling, general
and administrative expenses in both actual dollars and as a
percentage of net sales to remain at fiscal year 2003 levels during
fiscal year 2004.
o been unsuccessful in addressing core strategic weaknesses at the
Company that continue to dilute the value of the Nautica brand in
the retail marketplace. We believe senior management has been unable
to improve declines in net sales within the Company's men's
sportswear line. According to the Company's most recent Form 10-K,
net sales in the Company's men's sportswear business decreased 9.2%
from fiscal year 2002 to fiscal year 2003 and are expected to
decline further by approximately 13% to 15% during fiscal year 2004
due to ongoing pressure facing the men's collection business in
department stores. We believe that continued competition in both the
department store and specialty retail channels could result in
markdowns at the retail level, which, in our opinion, will further
dilute the value of the Nautica brand in the men's apparel market.
The Company also has continued to experience weakness in its women's
collections. In its earnings conference call on May 1, 2003, the
Company acknowledged that its women's jeans business is not
performing at profitability levels targeted by management. In
addition, management stated on this call that its women's Earl Jean
business is experiencing weakness.
o ineffectively deployed the Company's capital on an unproven brand
expansion and diversification strategy. The Company's efforts to
develop the Nautica Europe business have not enhanced shareholder
value According to a Company press release dated April 7, 2003, the
Company has decided to transition this business to a licensing
arrangement and reduce its investment in Europe. As a result, the
Company expects to incur an after-tax special charge of $6 million
to $7 million relating to closure costs, impairment of goodwill, the
writedown of fixed assets and the termination of certain lease
obligations. The Company's efforts to create a greater brand
identity through the operation of a Nautica full-price retail store
have proven unsuccessful. In fiscal year 2003, the Company,
according to its most recent Form 10-K, recorded an after-tax charge
of $6.5 million to write down the assets associated with its
Rockefeller Plaza Nautica store. Similarly, in 2001 the Company
acquired Earl Jean, Inc., an upscale denim brand, for approximately
$65.3 million, paying, according to the Company's Form 10-K for
fiscal year 2003, in excess of 12 times the "estimated fair value of
the net assets acquired." During its 2003 earnings conference call,
the Company acknowledged that it is experiencing weakness in its
U.S. based Earl Jean women's business. The Company's management has
also informed us that the Company's John Varvatos business, which
was launched in 2000, has not performed at desired levels.
o failed to address executive compensation levels, which we believe
are not aligned with stockholder interests. In our opinion, the
compensation payable to the Company's executive officers should be
restructured so that a meaningful portion of the annual cash salary
expense is eliminated and replaced with equity-based compensation in
the Company. We believe that eliminating a portion of this annual
6
cash expense will reduce the Company's selling, general and
administrative expenses and produce greater free cash flow. More
importantly, we believe that tying the amount of compensation
received by executives to specified improvement levels in
shareholder value will help to maximize the value of the Company's
stock.
o approved change of control provisions in certain Company contracts
that have the potential to misalign the interests of the board of
directors and the stockholders and impair shareholder value.
According to the Company's proxy statement for the 2003 annual
meeting, the Company has entered into employment agreements with
three of its senior executives providing that in the event of a
change of control in the Company (defined to include any event which
results in the members of the current board of directors no longer
constituting a majority of the board of directors), each of such
individuals has the right to receive a lump sum payment (aggregating
approximately $9.3 million for all three executives) upon
termination for employment other than for cause, disability or
resignation for good reason. In addition, stock options previously
granted to such individuals become fully vested and exercisable upon
a change of control. We believe these provisions weaken the rights
of stockholders to elect new members to the board of directors as
the removal of incumbent members of the board of directors may
trigger a significant payment by the Company and thereby reduce
shareholder value. Further, in our view, change of control
provisions are not the means to assure the continued service of
valued employees. Rather, we believe that such employees should be
rewarded appropriately for performance that increases shareholder
value. According to the Company's proxy statement for the 2003
annual meeting, Mr. Varvatos's employment agreement further provides
that if Mr. Sanders ceases to be employed by the Company during Mr.
Varvatos's term of employment, the Company is obligated to spin-off
or sell its subsidiary, John Varvatos Company, or make specified
payments to Mr. Varvatos. We believe this provision could diminish
shareholder value, as it limits the board of directors' ability to
make executive changes at the Company and forces the Company to
change its management or financial relationship with a subsidiary
regardless of such subsidiary's operating or financial condition.
Our Platform
The Barington Companies group is focused on the goal of maximizing the
value of the Company's stock. We believe that the Company's board of
directors needs additional independent members to advocate the interests of
stockholders and compel management to address persistent operational issues
that have been detrimental to shareholder value. This is consistent with the
Company's recently announced plan to name two, new independent members to its
board of directors by the 2004 annual meeting. We believe it is important
for shareholders to obtain additional independent directors now and not wait
until the 2004 annual meeting.
We have selected nominees with broad industry, management and financial
experience necessary to assist the board of directors in improving the
Company's operating performance. They are committed to the principles of our
platform, with the goal of establishing a results-oriented strategic plan to
enhance stockholder value. In furtherance of these principles, if
7
elected, our nominees intend to urge the Company's board of directors to take
the following actions:
o reduce the Company's operating expenses to improve profitability and
enhance cash flow generation;
o separate the role of Chairman and Chief Executive Officer at the
Company;
o revise the Company's strategic plan in order to enhance the Nautica
brand and improve its competitive position in the retail
marketplace;
o evaluate the Company's use of capital to maximize returns on equity;
o restructure compensation packages of selected executives at the
Company to align their interests with those of stockholders;
o review change of control provisions in selected Company contracts to
align the interests of the board of directors and the stockholders;
and
o implement formal processes at the Company to explore value-enhancing
strategic initiatives, including a possible sale or merger of the
Company.
As part of our proposals, we intend to vote the shares of common stock
represented by the proxy to re-elect all of the Company's incumbent directors
other than Messrs. Scherer and Varvatos. For the following reasons, we
believe that these individuals lack the independence and commitment that this
board needs:
o Mr. Scherer serves as managing partner of Hughes Hubbard & Reed LLP,
a law firm that provides legal services to the Company. For the past
three fiscal years ended March 1, 2003, the Company paid an
aggregate of approximately $3.5 million to Hughes Hubbard for legal
services. In addition, Samuel Sultanik, Esq., the brother-in-law of
the Company's Chairman, President and Chief Executive Officer, is a
partner of Hughes Hubbard.
o Mr. Varvatos serves as President of the John Varvatos Company, a
subsidiary of the Company. In its proxy statement with respect to
the 2003 annual meeting, the Company acknowledged that Mr. Varvatos
attended fewer than 75% of the Company's board meetings as a result
of Mr. Varvatos's schedule. Institutional Shareholder Services has
recommended in its Proxy Alert dated June 10, 2003 relating to the
Company that stockholders withhold their vote for Mr. Varvatos
stating that "absences due to schedule conflicts is not a valid
excuse."
In addition, our nominees will act to eliminate the burdens that the
Company's charter documents and current board have imposed on the exercise of
corporate democracy at the Company. These steps include:
8
o termination of the Company's stockholder rights plan, which imposes
draconian penalties on stockholders or stockholder groups that
beneficially own or commence a tender offer or exchange offer for
15% or more of the Company's stock. Not only does such plan
effectively prohibit accumulation of stockholdings in excess of this
threshold, it may also have the effect of discouraging stockholders
from collectively exercising their corporate democracy rights out of
concern that they will be deemed to be a group owning 15% or more of
the Company's shares. We note that while commentators and corporate
governance experts disagree on the propriety and utility of
stockholder rights plan, in some cases, such plans may result in
increased value to stockholders in takeover situations. Nonetheless,
we believe that any benefits of stockholder rights plans are
outweighed by the burdens such plans impose on corporate democracy
rights and the freedom of stockholders to act in a manner they
perceive to be in their own financial interest; and
o subject to stockholder approval, amending the Company's Restated
Certificate of Incorporation to eliminate the prohibition on
stockholder action by written consent.
The Barington Companies group nominees will not be in a position,
however, to effect any action, including any action referred to above,
without the support of at least three or more of the incumbent members of
the Company's board of directors. There can be no assurance that the
incumbent members of the board of directors will vote with our nominees to
take any of the actions described above.
While our nominees, if elected, will constitute only two of the eight
members of the Company's board of directors, such individuals will represent
two of the six, or 1/3, of the independent board members. As such, our
nominees may be able to exercise substantial influence on the Company's board
of directors and committees especially in light of the provisions of the
Sarbanes-Oxley Act of 2002, the regulations promulgated by the SEC pursuant
to this Act and the new corporate governance rules proposed by NASDAQ. These
proposed rules will require that members of the audit, compensation and
nominations committees of NASDAQ listed companies be comprised solely of
independent directors.
THE PROPOSALS
The Barington Companies group is soliciting proxies from the holders of
shares of common stock to (a) elect two nominees to the Company's board of
directors and six of the eight current incumbent directors and (b) amend
the By-laws to authorize stockholders who own, individually or in the
aggregate, 10% or more of the Company's outstanding common stock, to call a
special meeting of stockholders.
The election of directors requires a plurality of the votes cast in the
election. The proposed amendment to the By-laws requires an affirmative vote
of a majority of the shares outstanding on the record date for the 2003
annual meeting.
The Barington Companies group recommends that you vote for each of the
proposals by checking the appropriate boxes and signing, dating and returning
the enclosed GREEN proxy card.
9
Election of Directors
Proposal No. 1 -- Election of the Barington Companies Group Nominees as
Directors
Proposal No. 1 provides for the election of William J. Fox and James
A. Mitarotonda to serve as directors until the 2004 annual meeting of
stockholders. See "Certain Other Information Regarding The Barington
Companies Group Nominees" for information concerning the background and
experience of Messrs. Fox and Mitarotonda .
Proposal No. 2 -- Election of Certain Company Nominees as Directors
Proposal No. 2 provides for the election of the Company's nominees
other than Messrs. Scherer and Varvatos to serve as directors until the 2004
annual meeting of stockholders. See the Company's definitive proxy statement
for the names, backgrounds, qualifications and other information concerning
the Company's nominees.
Ratification of the Appointment of Independent Accountants (Company
Proposal)
Proposal No. 3 -- Ratification of Grant Thornton LLP as the Company's
Independent Certified Public Accountants
Proposal No. 3 provides for the ratification of the appointment by the
Company's board of directors of Grant Thornton LLP as the Company's
independent certified public accountants to examine the accounts of the
Company for the fiscal year ending February 28, 2004. See "Auditors" for
further information regarding Grant Thornton LLP.
Amendment of the By-laws
Proposal No. 4 -- Modification of Provision for Calling Special Meetings of
Stockholders
Proposal No. 4 provides for the amendment of Section 3 of Article I of
the By-laws to authorize stockholders who own, individually or in the
aggregate, 10% or more of the Company's outstanding common stock, to call a
special meeting of the stockholders. Delaware law provides that special
meetings of the stockholders may be called by the board of directors or such
other person or persons as may be authorized by the certificate of
incorporation or the by-laws. Proposal No. 4 would grant to stockholders the
ability to call special meetings. In particular, the amendment would delete
the text of Section 3 of Article I of the By-laws and replace it with the
following:
"A special meeting of the stockholders may be called
at any time by the Chairman, the President or a majority of
the board of directors of the Corporation, or by any
stockholder or stockholders of record entitled to vote at
such meeting, provided such stockholder or stockholders
beneficially or of record own in the aggregate at least 10%
of the outstanding shares of common stock of the
Corporation. If a special meeting is called, the person
calling the meeting shall submit the request, specifying
the time of such meeting and the general nature of the
business proposed to be transacted, such request to be
delivered personally, or sent
10
by registered mail or by telegraphic or other facsimile
transmission to the Chairman, the President or the
Secretary of the Corporation. No business may be transacted
at such special meeting other than such business specified
in the request. The officer receiving the request shall
cause notice to be given to the stockholders entitled to
vote at such meeting, in accordance with the provisions of
Section 4 of this Article I, that a special meeting be held
at the time requested by such person(s) calling the
meeting, provided that such meeting is not less than ten
(10) or more than sixty (60) days after receipt of the
request."
The Barington Companies group believes that giving the stockholders the
right to call a special meeting will provide the stockholders with a means to
promptly address any legitimate concerns they may have regarding the Company
and their investment, and their interests as stockholders. In addition, we
believe that such a provision will promote greater accountability to all
stockholders of the Company on the part of each director and the rest of
management.
General
Each of the Barington Companies group nominees has consented to being
named herein as a nominee for director of the Company and has agreed to stand
for election as a director.
Although the Barington Companies group has no reason to believe that
any of the Barington Companies group nominees will be unable to serve as a
director, if any Barington Companies group nominee is not available to serve,
the Barington Companies group expects that the remaining Barington Companies
group nominees, upon taking office, will fill the vacancy with an individual
willing to consider and implement the Barington Companies group's proposals
to maximize stockholder value. Although the Barington Companies group has no
reason to believe that any of the Company's nominees will be unable to serve
as a director, there can be no assurance that the Company's nominees will
serve as a director if elected with any of the Barington Companies group
nominees.
INFORMATION ABOUT THE BARINGTON COMPANIES GROUP
Members of the Barington Companies group, the Barington Companies group
nominees and certain other persons named below may be deemed to be
"participants" in this Proxy Solicitation as such term is defined in Schedule
14A promulgated under the Securities Exchange Act of 1934. Barington
Companies Equity Partners, L.P. is a Delaware limited partnership formed to
engage in the business of acquiring, holding and disposing of investments in
various companies. The address of the principal business and principal
offices of Barington Companies Equity Partners, L.P. is 888 Seventh Avenue,
17th Floor, New York, New York 10019.
The general partner of Barington Companies Equity Partners, L.P. is
Barington Companies Investors, LLC. Barington Companies Investors, LLC is a
Delaware limited liability company formed to be the general partner of
Barington Companies Equity Partners, L.P. The address of the principal
business and principal offices of Barington Companies Investors, LLC is 888
Seventh Avenue, 17th Floor, New York, New York 10019. James A. Mitarotonda
is the Managing Member of Barington Companies Investors, LLC. The business
address of Mr.
11
Mitarotonda is c/o Barington Capital Group, L.P., 888 Seventh Avenue, 17th
Floor, New York, New York 10019.
Jewelcor Management, Inc. is a Nevada corporation primarily involved in
investment and management services. The address of the principal business
and principal offices of Jewelcor Management, Inc. is 100 North Wilkes Barre
Blvd., Wilkes Barre, Pennsylvania 18702. The officers and directors of
Jewelcor Management, Inc. and their principal occupations and business
addresses are set forth on Schedule I attached to this Proxy Statement.
RCG Ambrose Master Fund, Ltd. is a Cayman Islands corporation engaged
in investing in companies effecting extraordinary transactions. The address
of the principal business and principal officers of RCG Ambrose Master Fund,
Ltd. is Citco Fund Services (Cayman Islands) Ltd., Corporate Centre, West Bay
Road, P.O. Box 31106 SMB, Grand Cayman, Cayman Islands, British West Indies.
The officers and directors of RCG Ambrose Master Fund, Ltd. and their
principal occupations and business addresses are set forth on Schedule II
attached to this Proxy Statement.
Ramius Securities, LLC is a Delaware limited liability company and a
registered broker-dealer. The address of the principal business and
principal offices of Ramius Securities, LLC is 666 Third Avenue, 26th Floor,
New York, New York 10017.
The Managing Member of Ramius Securities, LLC is Ramius Capital Group,
LLC, a Delaware limited liability company that is engaged in money management
and investment advisory services for third parties and proprietary accounts.
The address of the principal business and principal offices of Ramius Capital
Group, LLC is 666 Third Avenue, 26th Floor, New York, New York 10017.
The Managing Member of Ramius Capital Group, LLC is C4S, LLC, a
Delaware limited liability company formed to be the managing member of Ramius
Capital Group, LLC. The address of the principal business and principal
offices of C4S, LLC is 666 Third Avenue, 26th Floor, New York, New York
10017. Each of Peter A. Cohen, Morgan B. Stark and Thomas W. Strauss is a
Managing Member of C4S, LLC. The business address of each of Messrs. Cohen,
Stark and Strauss is 666 Third Avenue, 26th Floor, New York, New York 10017.
As of the date of this Proxy Statement, the Barington Companies group
owns an aggregate of 1,033,800 shares of common stock representing
approximately 3.1% of the outstanding shares of the common stock based upon
33,590,100 shares of common stock reported by the Company in its Schedule 14A
filed with the Securities and Exchange Commission on June 6, 2003, to be
issued and outstanding as of May 29, 2003.
Additional information about Barington Companies Equity Partners, L.P.,
the Barington Companies group and the Barington Companies group nominees
including information regarding the beneficial ownership of common stock is
set forth under the heading "Certain Other Information Regarding The
Barington Companies Group Nominees" and in Annex A attached to this Proxy
Statement.
The Barington Companies group has retained D.F. King to act as an
advisor and to provide consulting and analytic services and solicitation
services in connection with this Proxy
12
Solicitation. D.F. King is a proxy service company. D.F. King mails documents to
stockholders, responds to stockholder questions and solicits stockholder votes
for many companies. D.F. King does not believe that it or any of its directors,
officers, employees, affiliates or controlling persons, if any, is a
"participant" in this Proxy Solicitation or that Schedule 14A requires the
disclosure of certain information concerning D.F. King. The business address of
D.F. King is 48 Wall Street, 22nd Floor, New York, New York 10005. D.F. King has
informed the Barington Companies group that, as of the date of this Proxy
Statement, it does not hold any shares of the Company's common stock for its own
account or for the accounts of others.
BACKGROUND OF AND REASONS FOR THE PROXY SOLICITATION
Background
On various dates from April 17, 2003 through June 9, 2003, members of
the Barington Companies group purchased a total of 1,033,800 shares of common
stock in the open market for a total purchase price of $10,934,065, excluding
commissions and related costs. The details of these purchases are set forth
in Annex A attached to this Proxy Statement. All of the purchases were
funded by working capital, which included margin loans made by brokerage
firms in the ordinary course of business. The shares purchased by Barington
Companies Equity Partners, L.P. were funded, in part, by margin loans which
have been repaid in full. As of June 19, 2003, the outstanding amounts of
margin loans obtained by each of Jewelcor Management, Inc., RCG Ambrose
Master Fund, Ltd. and Ramius Securities, LLC in connection with their
purchase of shares of the Company's common stock were approximately $240,000,
$1.56 million and $2.65 million, respectively.
On various dates from April 15, 2003 to May 16, 2003, Mr. Mitarotonda
and other representatives of the Barington Companies group spoke with Shannon
L. Froehlich, Vice President of Corporate Investor Relations of the Company,
in connection with selected information requests with respect to the
operations and financial performance of the Company.
On May 16, 2003, Mr. Mitarotonda met with Mr. Sanders to discuss the
Company's operations, recent financial performance and business prospects.
On May 23, 2003, Mr. Mitarotonda met with Mr. Chu to discuss the
Company's operations, recent financial performance and business prospects.
On May 29, 2003, Mr. Mitarotonda and other representatives of the
Barington Companies group met with Wayne A. Marino, Senior Vice President and
Chief Financial Officer of the Company, to discuss the Company's operations,
recent financial performance and business prospects.
On June 2, 2003, Mr. Mitarotonda met with Mr. Chu to discuss the
Barington Companies group's ideas for enhancing shareholder value at the
Company.
On June 5, 2003, Barington Companies Equity Partners, L.P. sent a
letter to the Secretary of the Company and Mr. Sanders, notifying the Company
that at the 2003 annual meeting Barington Companies Equity Partners, L.P.
intended to nominate William J. Fox, James A.
13
Mitarotonda and Michael Steinberg as directors and to propose certain amendments
to the Company's Restated Certificate of Incorporation and By-laws and the
rescission of the Company's shareholder rights plan. In addition, Barington
Companies Equity Partners, L.P. requested that it be given the opportunity to
inspect the stockholder list.
On June 6, 2003, Mr. Mitarotonda telephoned Mr. Sanders to inform him
of the letter sent by Barington Companies Equity Partners, L.P. on June 5,
2003 and discuss the Barington Companies group nominees and proposals for the
2003 annual meeting.
On June 8, 2003, Mr. Mitarotonda spoke to Mr. Chu to discuss the
Barington Companies group nominees to the board of directors and its proposed
actions in connection with the 2003 annual meeting.
CERTAIN OTHER INFORMATION REGARDING
THE BARINGTON COMPANIES GROUP NOMINEES
Set forth below are the name, age, business address, present principal
occupation, employment history and directorships of each of the Barington
Companies group nominees for at least the past five years. This information
has been furnished to the Barington Companies group by the respective
Barington Companies group nominees. Each of the Barington Companies group
nominees has consented to serve as a director of the Company. Each of the
Barington Companies group nominees is at least 18 years of age. None of the
entities referenced below is a parent or subsidiary of the Company.
Present Principal Occupation, Five Year
Name, Age and Business Address Employment History and Directorships
--------------------------------------------------------------------------------
William J. Fox, 46 Mr. Fox serves as Chairman, President,
c/o Barington Capital Group, L.P. Chief Executive Officer and a director
888 Seventh Avenue of AKI, Inc. and as President, Chief
17th Floor Executive Officer and a director of
New York, New York 10019 AKI Holding Corp., an international
multi-sensory marketing, advertising
and sample systems business he has
managed since February 1999. He was
President, Strategic and Corporate
Development, of Revlon Worldwide,
Senior Executive Vice President of
Revlon, Inc. and Revlon Consumer
Products Corporation (referred to
herein as RCPC and collectively with
the other Revlon entities noted above
as Revlon) and Chief Executive Officer
of Revlon Technologies, a division of
Revlon, from January 1998 through
January 1999. He was Executive Vice
President from 1991 through January
1997, Senior Executive Vice President
from January 1997 though January 1999
and Chief Financial Officer from 1991
to 1997 of Revlon. Mr. Fox served as
14
a director of Revlon, Inc. (NYSE:REV)
from November 1995 until April 1999
and as director of RCPC from September
1994 until April 1999. He was Senior
Vice President of MacAndrews and
Forbes Holding Inc., the indirect
majority shareholder of Revlon, from
August 1990 through January 1999. Mr.
Fox was also an executive officer of
several MacAndrews' affiliates
including Technicolor Inc., The
Coleman Company, New World
Entertainment and Revlon Group
Incorporated. Mr. Fox currently
serves as Co-Chairman of the board and
Chairman of the Audit Committee of
Loehmanns Holdings Inc.
(NASDAQ:LHMS). From 1997 to December
1998, Mr. Fox served on the board of
directors and was Vice Chairman of The
Cosmetic Center, Inc., a public
company traded on the Nasdaq National
Market which filed a petition under
the federal bankruptcy laws in April
1999. He also served on the board of
directors and was Vice Chairman of The
Hain Food Group, a company now known
as The Hain Celestial Group, Inc.
(NASDAQ:HAIN). Mr. Fox is a member of
the board of directors of Liquid
Audio, Inc. (OTC:LQID.PK). He also
serves on the Advisory Board and is
Vice Chairman of Barington Companies
Investors, LLC.
James A. Mitarotonda, 49 Mr. Mitarotonda is Chairman of the
c/o Barington Capital Group, L.P. Board, President and Chief Executive
888 Seventh Avenue Officer of Barington Capital Group,
17th Floor L.P., an investment firm which he
New York, New York 10019 co-founded in November 1991. Mr.
Mitarotonda also is Chairman,
President and Chief Executive Officer
of Barington Companies Investors, LLC,
the general partner of Barington
Companies Equity Partners, L.P., a
small capitalization, value fund which
seeks to be actively involved with its
portfolio companies in order to
enhance shareholder value. He serves
as President, Chief Executive Officer
and a director of MM Companies, Inc.
(OTCBB:MMCO). In addition, he is
Co-Chairman of the board of directors,
Co-Chief Executive Officer,
Co-President and Chairman of the Audit
Committee of Liquid Audio, Inc.
15
(OTC:LQID.PK) and a member of the
board of directors of LP Innovations,
Inc. Mr. Mitarotonda also serves as
an observer to the board of directors
of FairMarket, Inc. (NASDAQ:FAIM). In
May 1988, Mr. Mitarotonda co-founded
Commonwealth Associates, an investment
banking, brokerage and securities
trading firm. Mr. Mitarotonda served
as Chairman of the Board and Co-Chief
Executive Officer of JMJ Management
Company Inc., the general partner of
Commonwealth. From December 1984 to
May 1988, Mr. Mitarotonda was employed
by D.H. Blair & Co., Inc., an
investment bank, brokerage and
securities trading firm, as Senior
Vice President/Investments. From July
1981 to November 1984, Mr. Mitarotonda
was employed by Citibank, N.A. in an
executive capacity having management
responsibility for two of Citibank's
business banking branches. During his
tenure at Citibank, Mr. Mitarotonda
became Regional Director of Citibank's
Home Equity Financing and Credit
Services. Mr. Mitarotonda began his
career in 1979 at Bloomingdale's as a
management trainee where he held
various retail management positions.
Mr. Mitarotonda was formerly a member
of the Alumni Advisory Council of New
York University's Stern School of
Business and is a member of the Gotham
Chapter of the Young President's
Organization, where he formerly served
on the Executive Committee and was
formerly Chairman of Membership and
Co-Chairman of Membership. Mr.
Mitarotonda also is a member of the
board of directors of The Friends of
Green Chimney. He graduated from New
York University's Leonard N. Stern
School of Business in 1979 with a
Master of Business Administration
degree and from Queens College in 1977
with a Bachelor of Arts degree with
honors in Economics.
16
The number of shares of the Company's common stock beneficially owned
and percentage beneficial ownership of each of the Barington Companies group
nominees as of the date of this Proxy Statement are as follows:
Barington Companies Number of Shares Percentage
group Nominee Beneficially Owned (1) (2) Ownership (3)
------------------------- ------------------------- -------------
William J. Fox 0 0%
James A. Mitarotonda 258,450 (4) .8%
Total 258,450 (4) .8%
--------------------
(1) Beneficial ownership is determined in accordance with the rules of
the SEC and generally includes voting or investment power with
respect to securities. Shares of common stock subject to stock
options and warrants currently exercisable or exercisable within 60
days are deemed outstanding for purposes of computing the percentage
ownership of any group of which the holder is a member, but are not
deemed outstanding for computing the percentage ownership of any
other person. Except as indicated by footnote, and subject to
community property laws where applicable, the persons named in the
table have sole voting and investment power with respect to all
shares of common stock shown as beneficially owned by them.
(2) Under the rules of the SEC, the Barington Companies group nominees
may be deemed to be members of a group and, as a result, each
Barington Companies group nominee may be deemed to beneficially own
shares of common stock beneficially owned by each of the other
Barington Companies group nominees. Each of the Barington Companies
group nominees disclaims beneficial ownership of the shares of
common stock beneficially owned by any of the other Barington
Companies group nominees.
(3) Calculated based on 33,590,100 shares of common stock outstanding as
of May 29, 2003 as reported in the Company's Schedule 14A filed with
the SEC on June 6, 2003.
(4) Consists of 258,450 shares of common stock owned by Barington
Companies Equity Partners, L.P. Mr. Mitarotonda is the Managing
Member of the general partner of Barington Companies Equity
Partners, L.P. and has sole voting power with respect to the 258,450
shares of common stock owned by Barington Companies Equity Partners,
L.P.
None of the Barington Companies group nominees is employed by the
Company. All of the Barington Companies group nominees are citizens of the
United States.
Except as set forth in this Proxy Statement or in the Annexes hereto,
none of the Barington Companies group, any of the persons participating in
this Proxy Solicitation on behalf of the Barington Companies group, the
Barington Companies group nominees and, with respect to items (i), (vii) and
(viii) of this paragraph, to the best knowledge of the Barington Companies
group, any associate (within the meaning of Rule 14a-1 of the Securities
Exchange Act of 1934) of the foregoing persons (i) owns beneficially,
directly or indirectly, any securities of the Company, (ii) owns
beneficially, directly or indirectly, any securities of any parent or
subsidiary
17
of the Company, (iii) owns any securities of the Company of record but not
beneficially, (iv) has purchased or sold any securities of the Company within
the past two years, (v) has incurred indebtedness for the purpose of acquiring
or holding securities of the Company, (vi) is or has within the past year been a
party to any contract, arrangement or understanding with respect to any
securities of the Company, (vii) since the beginning of the Company's last
fiscal year has been indebted to the Company or any of its subsidiaries in
excess of $60,000 or (viii) has any arrangement or understanding with respect to
future employment by the Company or with respect to any future transactions to
which the Company or any of its affiliates will or may be a party. In addition,
except as set forth in this Proxy Statement or in the Annexes hereto, none of
the Barington Companies group, any of the persons participating in this Proxy
Solicitation on behalf of the Barington Companies group, the Barington Companies
group nominees and, to the best knowledge of the Barington Companies group, any
associates of the foregoing persons, has had or is to have a direct or indirect
material interest in any transaction or proposed transaction with the Company in
which the amount involved exceeds $60,000, since the beginning of the Company's
last fiscal year.
Except as set forth in this Proxy Statement or in the Annexes hereto,
none of the Barington Companies group nominees, since the beginning of the
Company's last fiscal year, has been affiliated with (i) any entity that made
or received, or during the Company's current fiscal year proposes to make or
receive, payments to or from the Company or its subsidiaries for property or
services in excess of five percent of either the Company's or such entity's
consolidated gross revenues for its last full fiscal year, or (ii) any entity
to which the Company or its subsidiaries was indebted at the end of the
Company's last full fiscal year in an aggregate amount exceeding five percent
of the Company's total consolidated assets at the end of such year. None of
the Barington Companies group nominees is or during the Company's last fiscal
year has been affiliated with any law or investment banking firm that has
performed or proposes to perform services for the Company.
None of the corporations or organizations in which the Barington
Companies group nominees have conducted their principal occupation or
employment was a parent, subsidiary or other affiliate of the Company, and
the Barington Companies group nominees do not hold any position or office
with the Company or have any family relationship with any executive officer
or director of the Company or have been involved in any proceedings, legal or
otherwise, of the type required to be disclosed by the rules governing this
solicitation.
The Barington Companies group has orally agreed to indemnify each of
the Barington Companies group nominees against certain liabilities, including
liabilities under the federal securities laws, in connection with this Proxy
Solicitation and such person's involvement in the operation of the Company
and to reimburse such Barington Companies group nominee for his out-of-pocket
expenses.
AUDITORS
According to information contained in the Company's proxy statement,
the Company's board of directors has appointed Grant Thornton LLP as the
independent certified accountants to make an examination of the accounts of
the Company for the fiscal year ending February 28, 2004. Grant Thornton LLP
served as the Company's independent certified public accountants
18
for the years ended March 1, 2003 and March 2, 2002. The Company has stated that
a representative of Grant Thornton LLP is expected to be present at the 2003
annual meeting to respond to appropriate questions and to make a statement if
that representative so desires. The Company also has stated in its proxy
statement that in the event the stockholders fail to ratify the appointment, the
Company's board of directors will consider whether to retain Grant Thornton LLP
and that even if the selection is ratified by the Company's stockholders, the
Company's board of directors, in its discretion, may direct the appointment of a
different independent accounting firm at any time during the year if it
determines that such a change would be in the best interests of the Company and
its stockholders.
The Barington Companies group recommends that you vote for the
ratification of the appointment of Grant Thornton LLP as the Company's
independent certified public accountants for the fiscal year ending February
28, 2004. See Proposal No. 3 under "The Proposals."
SOLICITATION OF PROXIES
The Barington Companies group has retained D.F. King to act as an
advisor in connection with this Proxy Solicitation. In connection with its
retention by the Barington Companies group, D.F. King has agreed to provide
consulting and analytic services and solicitation services with respect to
banks, brokers, institutional investors and individual stockholders. The
Barington Companies group has agreed to pay D.F. King a fee for its services
estimated to be not more than $_________ and to reimburse D.F. King for its
reasonable out-of-pocket expenses. The Barington Companies group has also
agreed to indemnify D.F. King against certain liabilities and expenses in
connection with this Proxy Solicitation, including liabilities under the
federal securities laws. Approximately ___ employees of D.F. King will
engage in the solicitation. Proxies may be solicited by mail, advertisement,
telephone, facsimile or in person. Solicitations may be made by persons
employed by or affiliated with the members of the Barington Companies group.
However, no person will receive additional compensation for such solicitation
other than D.F. King.
Banks, brokerage houses and other custodians, nominees and
fiduciaries will be requested to forward the proxy materials to the
beneficial owners of shares of common stock for which they hold of record and
the Barington Companies group will reimburse them for their reasonable
out-of-pocket expenses.
The expenses related directly to this proxy solicitation are expected
to aggregate approximately [$______________ ] and will be borne by the
Barington Companies group. These expenses include fees and expenses for
attorneys, proxy solicitors, printing, postage, filing expenses and other
costs incidental to the solicitation. Of this estimated amount,
approximately [$_____________ ] has been spent to date. The actual costs and
expenses could be materially different than the estimated amounts and, in
particular, could be substantially higher if for any reason litigation is
instituted in connection with the matters related to this Proxy Statement.
The purpose of the proposals in this Proxy Statement is to advance the
interests of all the Company's stockholders. Therefore, the Barington
Companies group believes that its expenses related to this Proxy Solicitation
should be borne by the Company and it intends to seek reimbursement of such
expenses from the Company whether or not this Proxy Solicitation is
19
successful. The question of reimbursement of the expenses of the Barington
Companies group by the Company will not be submitted to a stockholder vote.
If you have any questions about this proxy solicitation or voting your
shares or require assistance, please contact:
D.F. King & Co., Inc.
48 Wall Street, 22nd Floor
New York, New York 10005
Toll Free: (888) 869-7406
Banks and Brokers call collect: (212) 269-5550
OTHER MATTERS
This proxy solicitation is being made by the Barington Companies group
and not on behalf of the board of directors or management of the Company.
The Barington Companies group is not aware of any other matters to be brought
before the Company's 2003 annual meeting, except as set forth herein. Should
other matters be brought before the 2003 annual meeting, by having signed and
returned the enclosed GREEN proxy card, you will have authorized the
persons named as proxies in the enclosed GREEN proxy card to vote on all
such matters in their discretion.
The Company's proxy statement relating to the 2003 annual meeting
contains information regarding (1) securities ownership of certain beneficial
owners and management of the Company; (2) the committees of the board of
directors; (3) the meetings of the board of directors and all committees
thereof; (4) the business background and employment biographies of the
Company's nominees for election to the board of directors; (5) the
compensation and remuneration paid and payable to the Company's directors and
management; and (6) the Company's stock price performance in relation to an
assumed group of "peers" or market-based indices. The Company's stockholders
are referred to the Company's proxy statement in connection with the 2003
annual meeting for this information.
STOCKHOLDER PROPOSALS FOR 2004 ANNUAL MEETING
The Company's proxy statement with respect to the 2003 annual meeting
indicates that proposals of the Company's stockholders intended to be
presented at the Company's 2004 annual meeting must be received by the
Company at its office at 40 West 57th Street, New York, New York 10019, no
later than February 6, 2004 in order for them to be considered for inclusion
in the Company's proxy statement and such proposals must comply with
applicable SEC rules and regulations. The Company's stockholders are hereby
referred to the Company's proxy statement in connection with the 2003 annual
meeting for such information.
INFORMATION REGARDING THE COMPANY
The information concerning the Company contained in this Proxy
Statement has been taken from or is based upon documents and records on file
with the SEC and other publicly available information. The Barington
Companies group has no knowledge that would indicate that statements relating
to the Company contained in this Proxy Statement in reliance upon
20
publicly available information are inaccurate or incomplete. The Barington
Companies group, however, has not been given access to the books and records of
the Company, was not involved in the preparation of such information and
statements, and is not in a position to verify, or make any representation with
respect to the accuracy or completeness of, any such information or statements.
VOTING PROCEDURES
Who is entitled to vote?
If the Company's stock records show that you are a stockholder as of
the close of business on the record date for the 2003 annual meeting, you are
entitled to vote the shares of common stock that you held on such date. Even
if you sell your shares after the record date for the 2003 annual meeting,
you will retain the right to execute a proxy in connection with the 2003
annual meeting. Each outstanding share of common stock entitles its holder
to cast one vote for each matter to be voted upon.
Can I attend the meeting?
All stockholders of record of the Company's common stock at the close
of business on May 29, 2003, the record date for the 2003 annual meeting, or
their designated proxies, are authorized to attend the 2003 annual meeting.
If your shares are held of record by a bank, broker or other nominee, you
will need to obtain a "legal proxy" form from your bank or broker if you wish
to vote at the 2003 annual meeting.
What constitutes a quorum? How will abstentions and broker non-votes be
counted?
The holders of a majority of the Company's common stock outstanding and
entitled to vote, present in person or represented by proxy, will constitute
a quorum at the 2003 annual meeting. Votes cast in person or by proxy at the
2003 annual meeting will be tabulated by the inspector of elections appointed
for the 2003 annual meeting to determine whether or not a quorum is present.
The inspector of elections will treat abstentions as shares that are present
and entitled to vote for purposes of determining the presence of a quorum,
but abstentions will neither be counted as votes for, nor the withholding of
authority for, the election of directors, but will have the effect of a vote
against all other matters submitted to a vote of stockholders.
Shares held by nominees for beneficial owners will be counted for
purposes of determining whether a quorum is present if the nominee has the
discretion to vote on at least one of the matters presented at the 2003
annual meeting, even if the nominee may not exercise discretionary voting
power with respect to other matters and voting instructions have not been
received from the beneficial owner (a "broker non-vote"). Broker non-votes
will not be counted as votes for, nor the withholding of authority for, the
election of directors (Proposal Nos. 1 and 2), but will have the effect of a
vote against all other matters submitted to a vote of stockholders.
21
How do I vote?
Voting by proxy for holders of shares registered in the name of a
brokerage firm or bank. If your shares are held by a broker, bank or other
nominee (i.e., in "street name"), only your bank or broker can give a proxy
with respect to your shares. You should receive a proxy card from your bank
or broker which you must return in the envelope provided in order to have
your shares voted. If you have not received a proxy card from your bank or
broker, you may contact it directly to provide it with instructions on how
you wish to vote. If you need assistance in dealing with your bank or
broker, please contact D.F. King at (888) 869-7406 or collect at (212)
269-5550.
Voting by proxy for holders of shares registered directly in the name
of the stockholder. If you hold your shares in your own name as a holder of
record, you may vote your shares by marking, signing, dating and mailing the
GREEN proxy card in the postage-paid envelope that has been provided to you
by the Barington Companies group. To vote your shares in accordance with
your instructions at the 2003 annual meeting, we must receive your proxy as
soon as possible but, in any event, prior to the 2003 annual meeting.
Vote in person. If you are a registered stockholder and attend the
2003 annual meeting you may deliver your completed GREEN proxy card in
person. "Street name" stockholders who wish to vote at the 2003 annual
meeting will need to obtain a "legal proxy" form from the broker, bank or
other nominee that holds their shares of record and must bring that document
to the meeting in order to vote in person at the 2003 annual meeting. If you
need assistance, please contact D.F. King at (888) 869-7406 or collect at
(212) 269-5550.
What should I do if I receive a proxy card which is not GREEN?
If you submit a proxy to us by signing and returning the enclosed
GREEN proxy card, do NOT sign or return the proxy card or follow any voting
instructions provided by the Company's board of directors unless you intend
to change your vote, because only your latest-dated proxy will be counted.
Can I revoke my proxy instructions?
You may revoke your proxy at any time before it has been exercised by:
o submitting a written revocation with the Corporate Secretary of the
Company or D.F. King;
o submitting a duly executed proxy bearing a later date with the
Corporate Secretary of the Company or D.F. King; or
o appearing in person and voting by ballot at the 2003 annual meeting
as described above under "How do I vote? -- Vote in Person."
Any stockholder of record as of the record date of the 2003 annual
meeting attending the 2003 annual meeting may vote in person whether or not a
proxy has been previously given, but
22
the presence (without further action) of a stockholder at the 2003 annual
meeting will NOT constitute revocation of a previously given proxy.
If you choose to revoke a proxy by giving written notice or a
later-dated proxy to the Corporate Secretary of the Company, although you are
not legally obligated to do so, we would appreciate if you would assist us in
representing the interests of stockholders on an informed basis by sending us
a copy of your revocation or proxy or by calling D.F. King, at (888) 869-7406
or collect at (212) 269-5550. Remember, your latest-dated proxy is the only
one that counts.
Will other matters be voted on at the annual meeting?
We are not now aware of any matters to be presented at the 2003 annual
meeting other than the election of directors, the ratification of the
appointment of the Company's independent auditors and our proposal. If any
other matters not described in the proxy statement are properly presented at
the 2003 annual meeting, including matters incidental to the conduct of the
2003 annual meeting, proxies will be voted in accordance with the best
judgment of the proxy holders.
If I plan to attend the annual meeting, should I still submit a proxy?
Whether you plan to attend the 2003 annual meeting or not, we urge you
to submit a proxy. Returning the enclosed GREEN proxy card will not affect
your right to attend the 2003 annual meeting.
How will my shares be voted?
If you give a proxy on the accompanying GREEN proxy card, your shares
will be voted as you direct. If you submit a proxy to us without
instructions, our representatives will vote your shares in favor of each of
the proposals. Submitting a GREEN proxy card will entitle our
representatives to vote your shares in accordance with their discretion on
matters not described in this Proxy Statement that may arise at the 2003
annual meeting, including matters incident to the conduct of the 2003 annual
meeting. Unless a proxy specifies otherwise, it will be presumed to relate
to all shares held of record on the record date for the 2003 annual meeting
by the person who submitted it.
23
How can I receive more information?
If you have any questions about giving your proxy or about our
solicitation, or if you require assistance, please call D.F. King at (888)
869-7406 or collect at (212) 269-5550.
--------------------------------------
Your vote is important. No matter how many or how few shares you own, please
vote (i) to elect the Barington Companies group nominees and (ii) to amend
the By-laws to authorize stockholders who own 10% or more of the Company's
outstanding common stock to call special meetings, by marking, signing,
dating and mailing the enclosed GREEN proxy card promptly.
THE BARINGTON COMPANIES GROUP
______________________, 2003
24
SCHEDULE I
Directors and Officers of Jewelcor Management, Inc.
Name and Position Principal Occupation Principal Business Address
----------------- -------------------- --------------------------
Seymour Holtzman, Chairman, Chief Executive 100 North Wilkes Barre Blvd.
Chairman, Chief Executive Officer, Officer, President Wilkes Barre, Pennsylvania 18702
President Jewelcor Management, Inc.
Richard Huffsmith, Vice President/General Counsel, 100 North Wilkes Barre Blvd.
Vice President and Jewelcor Management, Inc. Wilkes Barre, Pennsylvania 18702
General Counsel
Joseph F. Litchman, Director, Vice Vice President/Treasurer 100 North Wilkes Barre Blvd.
President/Treasurer Jewelcor Management, Inc. Wilkes Barre, Pennsylvania 18702
Maria Sciandra, Corporate Secretary, Corporate Secretary 100 North Wilkes Barre Blvd.
Director Jewelcor Management, Inc. Wilkes Barre, Pennsylvania 18702
25
SCHEDULE II
Directors and Officers of RCG Ambrose Master Fund, Ltd.
Name and Position Principal Occupation Principal Business Address
----------------- -------------------- --------------------------
CFS Company, Ltd., Nominee company P.O. Box 31106 SMB
Director Grand Cayman, Cayman Islands
Marran H. Ogilvie, General Counsel of Ramius 666 Third Avenue
Director Capital Group, LLC 26th Floor
New York, New York 10017
Andrew M. Strober, Chief Financial Officer of 666 Third Avenue
Director Ramius Capital Group, LLC 26th Floor
New York, New York 10017
CSS Corporation, Ltd., Secretary Nominee company 666 Third Avenue
26th Floor
New York, New York 10017
26
ANNEX A
TRANSACTIONS IN COMMON STOCK
The following table sets forth information with respect to all
purchases of common stock of the Company by the Barington Companies group during
the past two years. Except as set forth below, to the knowledge of the Barington
Companies group, no participant in this solicitation or Barington Companies
group nominee has purchased or sold securities of the Company within the past
two years.
Transaction Number of Price Per
Name Date Type Shares Share
--------------------------------------- --------- ----------- --------- ---------
Barington Companies Equity Partners, L.P. 4/17/03 Purchase 1,725 $10.77*
Barington Companies Equity Partners, L.P. 4/21/03 Purchase 10,218 $10.852*
Barington Companies Equity Partners, L.P. 4/22/03 Purchase 11,250 $10.998*
Barington Companies Equity Partners, L.P. 4/23/03 Purchase 7,450 $11.046*
Barington Companies Equity Partners, L.P. 4/24/03 Purchase 12,449 $10.887*
Barington Companies Equity Partners, L.P. 4/25/03 Purchase 11,100 $10.773*
Barington Companies Equity Partners, L.P. 4/28/03 Purchase 2,100 $10.90*
Barington Companies Equity Partners, L.P. 4/30/03 Purchase 6,775 $11.343*
Barington Companies Equity Partners, L.P. 5/1/03 Purchase 21,675 $10.959*
Barington Companies Equity Partners, L.P. 5/2/03 Purchase 24,400 $10.88*
Barington Companies Equity Partners, L.P. 5/5/03 Purchase 30,000 $10.534*
Barington Companies Equity Partners, L.P. 5/6/03 Purchase 4,325 $10.138*
Barington Companies Equity Partners, L.P. 5/7/03 Purchase 5,575 $10.111*
Barington Companies Equity Partners, L.P. 5/8/03 Purchase 1,869 $10.213*
Barington Companies Equity Partners, L.P. 5/9/03 Purchase 6,525 $10.09*
Barington Companies Equity Partners, L.P. 5/14/03 Purchase 725 $10.269*
Barington Companies Equity Partners, L.P. 5/15/03 Purchase 2,000 $10.256*
Barington Companies Equity Partners, L.P. 5/16/03 Purchase 15,700 $10.092*
Barington Companies Equity Partners, L.P. 5/19/03 Purchase 1,900 $9.746*
Barington Companies Equity Partners, L.P. 5/20/03 Purchase 2,450 $9.961*
Barington Companies Equity Partners, L.P. 5/21/03 Purchase 1,337 $9.984*
Barington Companies Equity Partners, L.P. 5/22/03 Purchase 5,668 $9.918*
Barington Companies Equity Partners, L.P. 5/23/03 Purchase 6,150 $9.915*
27
Barington Companies Equity Partners, L.P. 5/27/03 Purchase 5,000 $10.032*
Barington Companies Equity Partners, L.P. 5/28/03 Purchase 2,000 $10.14*
Barington Companies Equity Partners, L.P. 5/29/03 Purchase 4,500 $10.133*
Barington Companies Equity Partners, L.P. 5/30/03 Purchase 24,247 $10.298*
Barington Companies Equity Partners, L.P. 6/2/03 Purchase 3,750 $10.546*
Barington Companies Equity Partners, L.P. 6/3/03 Purchase 6,450 $10.593*
Barington Companies Equity Partners, L.P. 6/4/03 Purchase 4,734 $10.762*
Barington Companies Equity Partners, L.P. 6/6/03 Purchase 5,000 $10.349*
Barington Companies Equity Partners, L.P. 6/9/03 Purchase 3,450 $10.564*
Jewelcor Management, Inc. 4/17/03 Purchase 1,725 $10.77*
Jewelcor Management, Inc. 4/21/03 Purchase 10,218 $10.852*
Jewelcor Management, Inc. 4/22/03 Purchase 11,250 $10.998*
Jewelcor Management, Inc. 4/23/03 Purchase 7,450 $11.046*
Jewelcor Management, Inc. 4/24/03 Purchase 12,449 $10.887*
Jewelcor Management, Inc. 4/25/03 Purchase 11,100 $10.773*
Jewelcor Management, Inc. 4/28/03 Purchase 2,100 $10.90*
Jewelcor Management, Inc. 4/29/03 Purchase 5,952 $11.155*
Jewelcor Management, Inc. 4/30/03 Purchase 6,775 $11.343*
Jewelcor Management, Inc. 5/1/03 Purchase 21,675 $10.959*
Jewelcor Management, Inc. 5/5/03 Purchase 30,000 $10.534*
Jewelcor Management, Inc. 5/6/03 Purchase 4,325 $10.138*
Jewelcor Management, Inc. 5/7/03 Purchase 5,575 $10.111*
Jewelcor Management, Inc. 5/8/03 Purchaser 1,870 $10.213*
Jewelcor Management, Inc. 5/9/03 Purchase 6,525 $10.09*
Jewelcor Management, Inc. 5/14/03 Purchase 725 $10.269*
Jewelcor Management, Inc. 5/15/03 Purchase 2,000 $10.256*
Jewelcor Management, Inc. 5/16/03 Purchase 15,700 $10.092*
Jewelcor Management, Inc. 5/19/03 Purchase 1,900 $9.746*
Jewelcor Management, Inc. 5/20/03 Purchase 2,450 $9.961*
Jewelcor Management, Inc. 5/21/03 Purchase 1,336 $9.984*
Jewelcor Management, Inc. 5/22/03 Purchase 5,669 $9.918*
28
Jewelcor Management, Inc. 5/23/03 Purchase 6,150 $9.915*
Jewelcor Management, Inc. 5/27/03 Purchase 5,000 $10.032*
Jewelcor Management, Inc. 5/28/03 Purchase 2,000 $10.14*
Jewelcor Management, Inc. 5/29/03 Purchase 4,500 $10.133*
Jewelcor Management, Inc. 5/30/03 Purchase 24,247 $10.298*
Jewelcor Management, Inc. 6/2/03 Purchase 3,750 $10.546*
Jewelcor Management, Inc. 6/3/03 Purchase 6,450 $10.593*
Jewelcor Management, Inc. 6/4/03 Purchase 4,734 $10.762*
Jewelcor Management, Inc. 6/6/03 Purchase 5,000 $10.349*
Jewelcor Management, Inc. 6/9/03 Purchase 3,450 $10.564*
Ramius Securities, LLC 4/17/03 Purchase 1,725 $10.77*
Ramius Securities, LLC 4/21/03 Purchase 10,218 $10.852*
Ramius Securities, LLC 4/22/03 Purchase 11,250 $10.998*
Ramius Securities, LLC 4/23/03 Purchase 7,450 $11.046*
Ramius Securities, LLC 4/24/03 Purchase 12,449 $10.887*
Ramius Securities, LLC 4/25/03 Purchase 11,100 $10.773*
Ramius Securities, LLC 4/28/03 Purchase 2,100 $10.90*
Ramius Securities, LLC 4/29/03 Purchase 5,951 $11.155*
Ramius Securities, LLC 4/30/03 Purchase 6,775 $11.343*
Ramius Securities, LLC 5/1/03 Purchase 21,675 $10.959*
Ramius Securities, LLC 5/5/03 Purchase 30,000 $10.534*
Ramius Securities, LLC 5/6/03 Purchase 4,325 $10.138*
Ramius Securities, LLC 5/7/03 Purchase 5,575 $10.111*
Ramius Securities, LLC 5/8/03 Purchase 1,869 $10.213*
Ramius Securities, LLC 5/9/03 Purchase 6,525 $10.09*
Ramius Securities, LLC 5/14/03 Purchase 725 $10.269*
Ramius Securities, LLC 5/15/03 Purchase 2,000 $10.256*
Ramius Securities, LLC 5/16/03 Purchase 15,700 $10.092*
Ramius Securities, LLC 5/19/03 Purchase 1,900 $9.746*
Ramius Securities, LLC 5/20/03 Purchase 2,450 $9.961*
Ramius Securities, LLC 5/21/03 Purchase 1,338 $9.984*
29
Ramius Securities, LLC 5/22/03 Purchase 5,668 $9.918*
Ramius Securities, LLC 5/23/03 Purchase 6,150 $9.915*
Ramius Securities, LLC 5/27/03 Purchase 5,000 $10.032*
Ramius Securities, LLC 5/28/03 Purchase 2,000 $10.14*
Ramius Securities, LLC 5/29/03 Purchase 4,500 $10.133*
Ramius Securities, LLC 5/30/03 Purchase 24,247 $10.298*
Ramius Securities, LLC 6/2/03 Purchase 3,750 $10.546*
Ramius Securities, LLC 6/3/03 Purchase 6,450 $10.593*
Ramius Securities, LLC 6/3/03 Purchase 4,734 $10.762*
Ramius Securities, LLC 6/6/03 Purchase 5,000 $10.349*
Ramius Securities, LLC 6/9/03 Purchase 3,450 $10.564*
RCG Ambrose Master Fund, Ltd. 4/17/03 Purchase 1,725 $10.77*
RCG Ambrose Master Fund, Ltd. 4/21/03 Purchase 10,217 $10.852*
RCG Ambrose Master Fund, Ltd. 4/22/03 Purchase 11,250 $10.998*
RCG Ambrose Master Fund, Ltd. 4/23/03 Purchase 7,450 $11.046*
RCG Ambrose Master Fund, Ltd. 4/24/03 Purchase 12,450 $10.887*
RCG Ambrose Master Fund, Ltd. 4/25/03 Purchase 11,100 $10.773*
RCG Ambrose Master Fund, Ltd. 4/28/03 Purchase 2,100 $10.90*
RCG Ambrose Master Fund, Ltd. 4/29/03 Purchase 5,951 $11.155*
RCG Ambrose Master Fund, Ltd. 4/30/03 Purchase 6,775 $11.343*
RCG Ambrose Master Fund, Ltd. 5/1/03 Purchase 21,675 $10.959*
RCG Ambrose Master Fund, Ltd. 5/5/03 Purchase 30,000 $10.534*
RCG Ambrose Master Fund, Ltd. 5/6/03 Purchase 4,325 $10.138*
RCG Ambrose Master Fund, Ltd. 5/7/03 Purchase 5,575 $10.111*
RCG Ambrose Master Fund, Ltd. 5/8/03 Purchase 1,869 $10.213*
RCG Ambrose Master Fund, Ltd. 5/9/03 Purchase 6,525 $10.09*
RCG Ambrose Master Fund, Ltd. 5/14/03 Purchase 725 $10.269*
RCG Ambrose Master Fund, Ltd. 5/15/03 Purchase 2,000 $10.256*
RCG Ambrose Master Fund, Ltd. 5/16/03 Purchase 15,700 $10.092*
RCG Ambrose Master Fund, Ltd. 5/19/03 Purchase 1,900 $9.746*
RCG Ambrose Master Fund, Ltd. 5/20/03 Purchase 2,450 $9.961*
30
RCG Ambrose Master Fund, Ltd. 5/21/03 Purchase 1,338 $9.984*
RCG Ambrose Master Fund, Ltd. 5/22/03 Purchase 5,668 $9.918*
RCG Ambrose Master Fund, Ltd. 5/23/03 Purchase 6,150 $9.915*
RCG Ambrose Master Fund, Ltd. 5/27/03 Purchase 5,000 $10.032*
RCG Ambrose Master Fund, Ltd. 5/28/03 Purchase 2,000 $10.14*
RCG Ambrose Master Fund, Ltd. 5/29/03 Purchase 4,500 $10.133*
RCG Ambrose Master Fund, Ltd. 5/30/03 Purchase 24,247 $10.298*
RCG Ambrose Master Fund, Ltd. 6/2/03 Purchase 3,750 $10.546*
RCG Ambrose Master Fund, Ltd. 6/3/03 Purchase 6,450 $10.593*
RCG Ambrose Master Fund, Ltd. 6/3/03 Purchase 4,734 $10.762*
RCG Ambrose Master Fund, Ltd. 6/6/03 Purchase 5,000 $10.349*
RCG Ambrose Master Fund, Ltd. 6/9/03 Purchase 3,450 $10.564*
* Excludes commissions and execution related costs
31
ANNEX B
OWNERSHIP OF COMMON STOCK
Each share of common stock is entitled to one vote on each of the
proposals and the common stock is the only class of securities of the Company
entitled to vote on the proposals. According to the Company's Schedule 14A
filed with the SEC on June 6, 2003, as of May 29, 2003 there were 33,590,100
shares of common stock outstanding.
The following table sets forth the share ownership of all persons who,
to the knowledge of the Barington Companies group, beneficially own more than
5% of the outstanding shares of common stock as of the date of this Proxy
Statement. The information with respect to each stockholder, except as
otherwise indicated, is derived from the proxy materials filed by the Company
with the SEC on June 6, 2003.
Number of Shares Percentage
Stockholder Beneficially Owned (1) Ownership
----------------------------- --------------------- ---------------
David Chu (2) 1,795,392 5.1 %
Royce & Associates, Inc. (3) 2,931,000 8.7 %
FMR Corp. and related 3,580,000 10.7 %
parties (4)
Harvey Sanders (5) 4,698,440 13.5 %
----------------------
(1) Beneficial ownership is determined in accordance with the rules of the
SEC and generally includes voting or investment power with respect to
securities. Shares of common stock subject to stock options and
warrants currently exercisable or exercisable within 60 days are deemed
outstanding for purposes of computing the percentage ownership of the
person holding the options and the percentage ownership of any group of
which the holder is a member, but are not deemed outstanding for
computing the percentage ownership of any other person. Subject to
community property laws where applicable, to the knowledge of the
Barington Companies group, the persons named in the table have sole
voting and investment power with respect to all shares of common stock
shown as beneficially owned by them.
(2) Includes 1,358,940 shares which may be acquired pursuant to existing
stock options which are exercisable on or before July 22, 2003.
(3) The address of Royce & Associates, Inc. is 1414 Avenue of the Americas,
New York, New York 10019.
(4) In addition to FMR Corp., related parties are Fidelity Low Priced Stock
Fund, Fidelity Management and Research Company, Edward C. Johnson 3rd
and Abigail P. Johnson. The address of FMR Corp. is 82 Devonshire
Street, Boston, Massachusetts 02109.
32
(5) Includes 1,294,500 shares which may be acquired pursuant to existing
stock options which are exercisable on or before July 22, 2003 and
1,200,000 shares owned by the Harvey Sanders Grantor Retained Income
Trust. Such trust has sole voting and investment power with respect to
such shares.
33
ANNEX C
FORM OF PROXY SOLICITED ON BEHALF OF
THE BARINGTON COMPANIES GROUP
The undersigned stockholder of Nautica Enterprises, Inc., a Delaware
corporation (the "Company"), on May 29, 2003 (the "record date"), hereby
appoints James A. Mitarotonda or William J. Fox or either of them, each with
full power of substitution to act as proxies for the undersigned, and to vote
all shares of common stock, par value $.10 per share, of the Company, which
the undersigned would be entitled to vote if personally present at the 2003
Annual Meeting of Stockholders of the Company to be held on July 8, 2003, and
at any and all postponements and adjournments thereof as indicated on this
proxy.
IF YOU SIGN, DATE AND RETURN THIS CARD WITHOUT INDICATING YOUR VOTE ON
ONE OR MORE OF THE FOLLOWING PROPOSALS, YOU WILL BE DEEMED TO HAVE VOTED IN
FAVOR OF EACH OF THE PROPOSALS. IF YOU VOTE OR ABSTAIN WITH RESPECT TO ONE
OR MORE OF THE FOLLOWING PROPOSALS, THIS PROXY CARD WILL REVOKE ANY
PREVIOUSLY EXECUTED REVOCATION OF PROXY WITH RESPECT TO SUCH PROPOSALS.
[X] PLEASE MARK VOTES AS IN THIS EXAMPLE.
THE BARINGTON COMPANIES GROUP STRONGLY RECOMMENDS THAT STOCKHOLDERS
VOTE IN FAVOR OF EACH OF THE PROPOSALS.
Proposal No. 1 -- Election of William J. Fox and James A. Mitarotonda
as Directors
FOR [ ] AGAINST [ ] ABSTAINS [ ]
(Instruction: If you wish to vote for the election of certain of the
nominees, but not all of them, check the "FOR" box above and write the name
of each such person you do not wish elected in the following
space:________________________________________. If no box is marked above
with respect to this Proposal, the undersigned will be deemed to vote for
such Proposal, except that the undersigned will not be deemed to vote for the
election of any candidate whose name is written in the space provided above.)
34
Proposal No. 2 -- Election of Certain Company Nominees as Directors
The Company is nominating eight people to serve as directors. The
Barington Companies group intends to use this proxy to vote FOR six of the
individuals nominated by the Company and not for the other two nominees of
the Company whose names are listed below. You may withhold authority to vote
for one or more of the six nominees of the Company not listed on this proxy
by writing the name of such nominee below. You should refer to the Company's
definitive proxy statement in connection with the 2003 annual meeting for the
names, backgrounds, qualifications and other information concerning the
Company's nominees. There is no assurance that any of the Company's nominees
will serve as directors if any of the Barington Companies group nominees are
elected to the Company's board of directors.
The Company nominees with respect to whom the Barington Companies group
is NOT seeking authority to vote for and WILL NOT exercise any such authority
are:
Charles H. Scherer and John Varvatos
In order to withhold authority to vote for the election of a Company
nominee whose name is not listed above, write such nominee's name on the line
provided below:
-------------------------------------------------------------------------------
Proposal No. 3 - Ratification of Appointment of Grant Thornton LLP as
Independent Certified Public Accountants for the Company
FOR [ ] AGAINST [ ] ABSTAINS [ ]
Proposal No. 4 - Authorize Stockholders Holding 10% or More of Common
Stock to Call Special Meetings
FOR [ ] AGAINST [ ] ABSTAINS [ ]
35
And in the discretion of the proxies appointed hereunder, on such other
business as may properly come before the meeting.
Dated:
---------------------------
---------------------------
Signature:
---------------------------
Signature (if held jointly):
---------------------------
Title or Authority
Please sign exactly as name appears hereon. If shares are registered in more
than one name, the signature of all such persons should be provided. A
corporation should sign in its full corporate name by a duly authorized
officer, stating his or her title. Trustees, guardians, executors and
administrators should sign in their official capacity, giving their full
title as such. If a partnership, please sign in the partnership name by an
authorized person. The proxy card votes all shares in all capacities.
PLEASE MARK, SIGN AND DATE THIS PROXY BEFORE MAILING THE PROXY IN THE
ENCLOSED ENVELOPE.
If you have any questions or need assistance in voting your shares,
please contact D.F. King & Co., Inc. toll-free at 1-888-869-7406 or if you
are a bank or broker please call collect at 1-212-269-5550.
36