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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
SIGNATURE EYEWEAR, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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SIGNATURE EYEWEAR, INC.
----------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 28, 2000
----------------
TO OUR SHAREHOLDERS:
Notice is hereby given that the 2000 Annual Meeting of Shareholders of
Signature Eyewear, Inc. ("Signature" or the "Company") will be held at The
Renaissance Hotel, 9620 Airport Boulevard, Los Angeles, California 90045 on
April 28, 2000 at 10:30 a.m., Pacific time. The Annual Meeting is being held
for the following purposes:
1. To elect a Board of six Directors to hold office until the next Annual
Meeting of Shareholders and until their respective successors have been
elected. The persons nominated by the Board of Directors of the Company
(Ms. Heldman and Messrs. Weiss, Prince, Warren, Buchsbaum and Johnson)
are described in the accompanying Proxy Statement; and
2. To transact such other business as may properly come before the Annual
Meeting or any of its adjournments or postponements.
Only shareholders of record of the Common Stock of the Company at the close
of business on March 15, 2000 are entitled to notice of, and to vote at, the
Annual Meeting and any of its adjournments or postponements.
All shareholders are cordially invited to attend the Annual Meeting in
person. However, to ensure your representation at the Annual Meeting, you are
urged to mark, sign and return the enclosed Proxy as promptly as possible in
the postage prepaid envelope enclosed for that purpose. Any shareholder of
record attending the Annual Meeting may vote in person, even though he or she
has returned a Proxy.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Julie Heldman
Julie Heldman
Co-Chairman of the Board, President and
Secretary
Inglewood, California 90302
April 3, 2000
IN ORDER TO ENSURE YOUR REPRESENTATION AT THE MEETING, PLEASE COMPLETE,
DATE, SIGN AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED ENVELOPE AS
PROMPTLY AS POSSIBLE. IF YOU ARE A SHAREHOLDER OF RECORD AND DO ATTEND THE
MEETING, YOU MAY, IF YOU PREFER, REVOKE YOUR PROXY AND VOTE YOUR SHARES IN
PERSON.
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SIGNATURE EYEWEAR, INC.
----------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 28, 2000
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Signature Eyewear, Inc., a California
corporation (the "Company"), for use at the 2000 Annual Meeting of
Shareholders (the "Annual Meeting") to be held at The Renaissance Hotel, 9620
Airport Boulevard, Los Angeles, California 90045 on April 28, 2000 at 10:30
a.m., Pacific time, and at any of its adjournments or postponements, for the
purposes set forth herein and in the attached Notice of Annual Meeting of
Shareholders. Accompanying this Proxy Statement is the Board of Directors'
Proxy for the Annual Meeting, which you may use to indicate your vote on the
proposals described in this Proxy Statement.
All Proxies which are properly completed, signed and returned to the
Company before the Annual Meeting, and which have not been revoked, will
unless otherwise directed by the shareholder be voted in accordance with the
recommendations of the Board of Directors set forth in this Proxy Statement. A
shareholder may revoke his or her Proxy at any time before it is voted either
by filing with the Secretary of the Company, at its principal executive
offices, a written notice of revocation or a duly executed proxy bearing a
later date, or, with respect to shareholders of record, by attending the
Annual Meeting and expressing a desire to vote his or her shares in person.
The close of business on March 15, 2000 has been fixed as the record date
for the determination of shareholders entitled to notice of, and to vote at,
the Annual Meeting or any adjournments or postponements of the Annual Meeting.
At the record date, 5,058,489 shares of Common Stock, par value $.001 per
share (the "Common Stock"), were outstanding. The Common Stock is the only
outstanding class of capital stock of the Company.
A shareholder is entitled to cast one vote for each share held of record on
the record date on all matters to be considered at the Annual Meeting. The six
nominees for election as directors at the Annual Meeting who receive the
highest number of affirmative votes will be elected. Abstentions and broker
non-votes will be included in the number of shares present at the Annual
Meeting for the purpose of determining the presence of a quorum. Abstentions
will be counted toward the tabulation of votes cast on proposals submitted to
shareholders and will have the same effect as negative votes, while broker
non-votes will not be counted either as votes cast for or against such
matters.
This Proxy Statement and the accompanying Proxy were mailed to shareholders
on or about April 3, 2000.
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ELECTION OF DIRECTORS
In accordance with the Bylaws of the Company, the Company's directors are
elected at each Annual Meeting of Shareholders and hold office until the next
Annual Meeting and until their successors are duly elected. The Bylaws of the
Company provide that the Board of Directors shall consist of no fewer than
four and no more than seven directors as determined from time to time by the
Board of Directors. The Board of Directors currently consists of six
directors.
Unless otherwise instructed, the Proxy holders will vote the Proxies
received by them for the nominees named below. If any nominee is unable or
unwilling to serve as a director at the time of the Annual Meeting or any of
its postponements or adjournments, the Proxies will be voted for such other
nominee(s) as shall be designated by the current Board of Directors to fill
any vacancy. The Company has no reason to believe that any nominee will be
unable or unwilling to serve if elected as a director.
The Board of Directors proposes the election of the following nominees as
directors:
Bernard Weiss
Julie Heldman
Michael Prince
Daniel Warren
Maurice Buchsbaum
Joel Johnson
If elected, each nominee is expected to serve until the 2001 Annual Meeting
of Shareholders and his or her successor is duly elected and qualified. The
six nominees for election as directors at the Annual Meeting who received the
highest number of affirmative votes will be elected.
The Board of Directors unanimously recommends a vote "FOR" the election of
the Nominees listed above.
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Information about Nominees and Executive Officers
The following table sets forth certain information with respect to the
nominees and executive officers of the Company as of March 1, 2000:
<TABLE>
<CAPTION>
Year
First
Elected
or
Appointed
Name: Age Director Principal Occupation
----- --- --------- --------------------
<C> <C> <C> <S>
Nominees:
Bernard Weiss(1) 61 1983 Mr. Weiss has served as Chief Executive
Officer of the Company since 1983. Mr. Weiss
served as Chairman of the Board from 1983 to
1988, and has served as Co-Chairman of the
Board since 1989. Mr. Weiss started in the
optical industry in 1975 as Vice President of
Sales and Marketing for Optique du Monde. From
1977 until he founded the Company in 1983, Mr.
Weiss worked in a variety of executive
positions at companies in the optical
industry.
Julie Heldman(1) 54 1985 Ms. Heldman has served as Co-Chairman of the
Board since 1989 and President of the Company
since 1995. Ms. Heldman joined the Company in
1985 and since that time has served in various
executive positions including Chief Financial
Officer and Executive Vice President of
Operations. She held the position of Chief
Operating Officer from 1992 until she was
appointed President of the Company in 1995.
Ms. Heldman graduated from Stanford University
in 1966 and has a law degree from UCLA Law
School which she obtained in 1981. Ms. Heldman
worked as an attorney from 1981 until she
joined the Company in 1985.
Michael Prince 50 1994 Mr. Prince joined the Company in 1993 and has
served as the Chief Financial Officer and as a
Director of the Company since March 1994. For
more than 14 years before joining the Company,
Mr. Prince's primary occupation was as a
principal with Prince & Co., a business
consulting firm that he owned.
Daniel Warren 42 1993 Mr. Warren has served as a director of the
Company since 1993. From January 1996 until
the present, Mr. Warren has been self-employed
as a consultant. From March 1992 until January
1996, Mr. Warren was Vice President of
Planning and Accounting of National Vision
Associates, Ltd.
Maurice Buchsbaum 57 1997 Mr. Buchsbaum has served as a director of the
Company since November 1997. Mr. Buchsbaum
currently is Chief Executive Officer of
Emerald Capital Partners, Inc. Mr. Buchsbaum
was Senior Vice President of Southeast
Research Partners, an investment banking firm,
from January 1998 to January 1999. From
September 1995 until January 1998, he was
Senior Vice President and Senior Managing
Director of Corporate Finance for Fechtor
Detwiler & Co., Inc., and he served as
President of Emerald Partners, Inc. from
January 1993 until September 1995.
</TABLE>
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<TABLE>
<CAPTION>
Year
First
Elected
or
Appointed
Name: Age Director Principal Occupation
----- --- --------- --------------------
<C> <C> <C> <S>
Joel Johnson 45 1998 Mr. Johnson has been designated by
Fechtor, Detwiler & Co., Inc. as its
nominee to serve on the Board of
Directors. Mr. Johnson is owner and
President of Orchard Partners, Inc., a
professional firm providing advisory
services in corporate finance which he
formed in February 1998. For eight
years before forming Orchard Partners,
Mr. Johnson served in the investment
banking department of Fechtor,
Detwiler & Co., Inc. He received an
MBA in Finance from the University of
Colorado in 1980 and an AB from
Harvard College in 1976.
Other Executive Officers:
Robert Fried 55 Mr. Fried has served as the Company's
chief marketing executive since
joining the Company in 1990. In 1995,
he was appointed the Company's Senior
Vice President of Marketing. Before
joining the Company in 1990, Mr. Fried
served in various executive marketing
positions at Motorola, Quasar
Electronics, Rockwell International,
Starcraft Leisure Products, Marantz
Stereo Company, Nautilus Fitness, Inc.
and Hansen Foods.
Robert Zeichick 49 Mr. Zeichick has served as the
Company's chief advertising and
promotion executive since joining the
Company in November 1990. In 1995, he
was appointed the Company's Vice
President of Advertising and Sales
Promotion. From 1988 until joining the
Company in 1990, Mr. Zeichick served
as Vice President of Advertising and
Sales Promotion at Nautilus Fitness,
Inc. and Hansen Foods. Mr. Zeichick
worked as an independent advertising
consultant from 1984 until 1988 and
worked on such brand names as
Applause, Walt Disney Home Video and
Marantz.
</TABLE>
- --------
(1) Mr. Weiss and Ms. Heldman are married.
Agreement to Nominate Director
Pursuant to an Underwriting Agreement among the Company, Fechtor, Detwiler
& Co., Inc. ("Fechtor Detwiler") and certain selling shareholders entered into
in connection with the Company's initial public offering in September 1997,
the Company has agreed, until September 2000, to use its best efforts to cause
one nominee designated by Fechtor Detwiler to be elected to the Board of
Directors. Mr. Johnson has been designated by Fechtor Detwiler as its nominee
to serve on the Board of Directors.
Board Meetings and Committees
The Board of Directors held seven meetings during fiscal 1999. No director
attended less than 75% of all the meetings of the Board of Directors and those
committees on which he or she served in fiscal 1999.
The Board of Directors has an Audit Committee. The Audit Committee
currently consists of Daniel Warren, Joel Johnson and Maurice Buchsbaum. The
Audit Committee recommends the engagement of the Company's independent public
accountants, reviews the scope of the audit to be conducted by such
independent public accountants, and meets with the independent public
accountants and the Chief Financial Officer of the Company to review matters
relating to the Company's financial statements, the Company's accounting
principles and its
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system of internal accounting controls, and reports its recommendations about
the approval of the Company's financial statements to the Board of Directors.
One meeting of the Audit Committee was held during fiscal 1999.
The Board of Directors also has a Compensation Committee, which currently
consists of Daniel Warren, Joel Johnson, Maurice Buchsbaum and Julie Heldman.
The Compensation Committee makes decisions about the compensation of the
Company's executive management, manages the Company's 1997 Stock Plan,
determines the pricing and the number of shares subject to awards granted
under the 1997 Stock Plan and administers the Company's other incentive
compensation plans. The Compensation Committee was created in November 1999,
and held no meetings during fiscal 1999.
Compensation of Directors
Each director who is not an officer of or otherwise employed by the Company
receives an annual retainer of $8,000. During fiscal 1999, each director who
was not an officer of the Company was awarded non-statutory stock options to
purchase up to 4,000 shares of the Company's Common Stock under the 1997 Stock
Plan. In addition, each director who was not an officer of the Company was
paid a further $4,000 during fiscal 1999.
Compensation Committee Interlocks and Insider Participation
For the fiscal year ended October 31, 1999, the Board of Directors acting
unanimously made all decisions regarding executive compensation. Ms. Heldman
and Messrs. Weiss and Prince, executive officers of the Company, participated
in deliberations regarding executive compensation. No interlocking
relationship exists between any member of the Board of Directors and any
member of any other company's board of directors or compensation committee.
Report of the Board of Directors on Executive Compensation
The Company's Board of Directors is responsible for establishing and
administering the policies that govern executive compensation and benefit
practices. The Board of Directors currently maintains a Compensation
Committee, which was created in November 1999, after the end of the Company's
1999 fiscal year.
Compensation Philosophy. The Company's executive compensation program is
designed to (1) provide levels of compensation that integrate pay and
incentive plans with the Company's strategic goals, so as to align the
interests of executive management with the long-term interests of the
Company's shareholders, (2) attract, motivate and retain executives of
outstanding abilities and experience capable of achieving the strategic
business goals of the Company, (3) recognize outstanding individual
contributions, and (4) provide compensation opportunities which are
competitive to those offered by other prescription eyeglass frame companies of
similar size and performance. To achieve these goals, the Company's executive
compensation program consists of three main elements: (i) base salary, (ii)
annual cash bonus and (iii) long-term incentives. Each element of compensation
has an integral role in the total executive compensation program.
Base Salary. Base salaries are negotiated at the commencement of an
executive's employment with the Company, or upon renewal of his or her
employment agreement, and are designed to reflect the position, duties and
responsibilities of each executive officer, the cost of living in the area in
which the officer is located and the market for base salaries of similarly
situated executives at other companies engaged in businesses similar to that
of the Company. During fiscal 1999, Bernard Weiss served as the Company's
Chief Executive Officer and Julie Heldman served as the Company's President.
In September 1997, Mr. Weiss and Ms. Heldman each entered into employment
agreements with the Company providing for, among other things, the payment to
Mr. Weiss and Ms. Heldman of base salaries of $190,000 each during the terms
of their agreements, subject to increases from time to time approved by the
Company's Board of Directors. Mr. Weiss and Ms. Heldman each received a base
salary of $190,000 in fiscal 1999 pursuant to their employment agreements.
Annual Cash Bonuses. Executive officers are eligible for annual incentive
bonuses in amounts determined at the discretion of the Board of Directors. The
Board considers an award of an annual bonus
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subjectively, taking into account factors such as the financial performance of
the Company, increases in shareholder value, the achievement of corporate
goals and individual performance. Neither Mr. Weiss nor Ms. Heldman received a
cash bonus in fiscal 1999.
Long-Term Incentives. The Company provides its executive officers with
long-term incentive compensation through grants of awards under the Company's
1997 Stock Plan. Under the 1997 Stock Plan, the Board of Directors is
authorized to grant any type of award which might involve the issuance of
shares of Common Stock, an option, warrant, convertible security, stock
appreciation right or similar right or any other security or benefit with a
value derived from the value of the Common Stock. The Board of Directors is
currently responsible for selecting the individuals to whom grants of awards
should be made, the timing of grants, the determination of the per share
exercise price and the number of shares subject to each award. All awards
granted by the Board of Directors pursuant to the 1997 Stock Plan have been in
the form of stock options. The Board of Directors believes that stock options
provide the Company's executive officers with the opportunity to purchase and
maintain an equity interest in the Company and to share in the appreciation of
the value of the Common Stock. The Board of Directors believes that stock
options directly motivate an executive to maximize long-term shareholder
value. The options incorporate vesting periods in order to encourage key
employees to continue in the employ of the Company. All options granted in
fiscal 1999 were granted with an exercise price at or above the fair market
value of the Company's Common Stock on the date of grant. During fiscal 1999,
neither Mr. Weiss nor Ms. Heldman was granted options to purchase shares of
the Company's Common Stock. The Board of Directors considers the grant of each
option subjectively, considering factors such as the individual performance of
executive officers and competitive compensation packages in the industry.
Summary. The Board of Directors believes that its executive compensation
philosophy of paying its executive officers by means of base salaries, annual
cash bonuses and long-term incentives, as described in this report, serves the
interests of the Company and its shareholders.
BOARD OF DIRECTORS
Bernard Weiss
Julie Heldman
Michael Prince
Daniel Warren
Maurice Buchsbaum
Joel Johnson
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SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, requires the
Company's executive officers, directors, and persons who own more than ten
percent of a registered class of the Company's equity securities to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission (the "SEC"). Executive officers, directors and greater-than-ten
percent shareholders are required by SEC regulations to furnish the Company
with all Section 16(a) forms they file. Based solely on its review of the
copies of the forms received by it and written representations from certain
reporting persons that they have complied with the relevant filing
requirements, the Company believes that, during the year ended October 31,
1999, all the Company's executive officers, directors and greater-than-ten
percent shareholders complied with all Section 16(a) filing requirements with
the exception of: (i) The Weiss Family Trust, Bernard Weiss and Julie Heldman
did not file a Form 4 to report the sale of 20,000 shares of Common Stock in
January 1999; The Weiss Family Trust, Bernard Weiss and Julie Heldman each
filed a Form 5 in December 1999 to report the sale of the shares; and (ii)
Michael Prince did not file a Form 5 within 45 days following the Company's
fiscal year end to report his receipt of options to purchase 9,000 shares of
Common Stock in June 1999; Mr. Prince filed a Form 5 on the 47th day following
the Company's fiscal year end to report his receipt of the options. The
Company believes that the Weiss Family Trust, Bernard Weiss, Julie Heldman and
Michael Prince are now current in their Section 16(a) reporting obligations.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth, as to the Chief Executive Officer and as to
each of the other four most highly compensated officers whose compensation
exceeded $100,000 during the last fiscal year (the "Named Executive
Officers"), information concerning all compensation paid for services to the
Company in all capacities during the last three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
Compensation
------------
Annual Number of
Fiscal Year Compensation Securities
Name and Principal Ended ---------------- Underlying All Other
Position (1) October 31, Salary Bonus Options Compensation
------------------ ----------- -------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Bernard Weiss .......... 1999 $190,000 $ -- $ -- $ --
Chief Executive Officer 1998 190,000 -- -- --
1997 185,000 -- 20,000 --
Julie Heldman........... 1999 $190,000 $ -- $ -- --
President 1998 193,780 -- -- --
1997 185,000 -- 20,000 --
Michael Prince.......... 1999 $175,000 $25,000 9,000 $ --
Chief Financial Officer 1998 175,000 25,000 -- --
1997 170,712 -- 35,000 --
Robert Fried ........... 1999 $175,000 $25,000 9,000 $ --
Senior Vice President, 1998 175,000 25,000 -- --
Marketing 1997 170,712 -- 35,000 --
Robert Zeichick ........ 1999 $160,000 $25,000 9,000 $ --
Vice President, 1998 160,952 25,000 -- --
Advertising 1997 162,923 -- 35,000 --
and Sales Promotion
</TABLE>
- --------
(1) For a description of the employment contract between each officer and the
Company, see "Employment Contracts," below.
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Option Grants in Last Fiscal Year
The following table sets forth certain information regarding the grant of
stock options made during the fiscal year ended October 31, 1999 to the Named
Executive Officers.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential
Realizable Value
At Assumed
Number Of Percent Of Rate of Stock Price
Securities Total Options Appreciation for
Underlying Granted To Option Term(3)
Option Employees In Exercise Or Expiration --------------------
Name Granted Fiscal Year(1) Base Price(2) Date 5% 10%
---- ---------- ------------- ------------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Michael Prince.......... 9,000(4) 4.2% $4.00 7/13/09 $ 22,680 $ 57,330
Robert Fried............ 9,000(4) 4.2% $4.00 7/13/09 $ 22,680 $ 57,330
Robert Zeichick......... 9,000(4) 4.2% $4.00 7/13/09 $ 22,680 $ 57,330
</TABLE>
- --------
(1) Options covering an aggregate of 213,700 shares of Common Stock were
granted to employees during the fiscal year ended October 31, 1999.
(2) The exercise price and tax withholding obligations related to exercise
may be paid by delivery of already owned shares, subject to certain
conditions.
(3) The potential realizable value is based on the assumption that the Common
Stock appreciates at the annual rate shown (compounded annually) from the
date of grant until the expiration of the option term. These amounts are
calculated pursuant to applicable requirements of the Commission and do
not represent a forecast of the future appreciation of the Common Stock.
(4) This option is currently exercisable.
Stock Options Held at Fiscal Year End
The following table sets forth, for each of the Named Executive Officers,
certain information regarding the number of shares of Common Stock underlying
stock options held at fiscal year end and the value of options held at fiscal
year end based upon the last reported sales price of the Common Stock on the
Nasdaq Stock Market's National Market on October 30, 1999 ($3.31 per share).
No stock options were exercised by any Named Executive Officer during fiscal
1999.
AGGREGATED FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexecuted Value of Unexercised
Options at in-the-Money Options
October 31, 1999 at October 31, 1999
------------------------- -------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Bernard Weiss............... 12,000 8,000 $ 0 $ 0
Julie Heldman............... 12,000 8,000 0 0
Michael Prince.............. 30,000 14,000 0 0
Robert Fried................ 30,000 14,000 0 0
Robert Zeichick............. 30,000 14,000 0 0
</TABLE>
Employment Contracts
Bernard Weiss, Julie Heldman, Michael Prince, Robert Fried and Robert
Zeichick have each entered into an employment agreement with the Company that
took effect on September 16, 1997. Pursuant to those agreements, each of these
executive officers has agreed to render services until October 31, 2000, and
will be entitled to salary at the following annual rates during the term of
their contracts (subject to increases from time to time approved
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by the Board of Directors or Compensation Committee): Mr. Weiss--$190,000; Ms.
Heldman--$190,000; Mr. Prince--$175,000; Mr. Fried--$175,000; and Mr.
Zeichick--$160,000.
Upon termination of employment by the Company without cause or by an
executive officer upon an adverse event, an executive officer will continue to
receive salary and benefits until the later to occur of October 31, 2000 or
one year following termination. The employment agreements define an "adverse
event" to include the occurrence of any of the following, without the prior
written consent of the executive officer: (i) the executive's demotion as
evidenced by the loss of the executive officer's title, (ii) a significant
diminution of the executive's on-going duties and responsibilities, (iii) the
relocation of the Company's principal executive offices outside the Los
Angeles Metropolitan area, or (iv) the Company requiring the executive to
relocate to an office outside the Los Angeles Metropolitan area for a period
exceeding three months in any calendar year. If employment terminates as a
result of death, the executive officer's estate will receive a payment equal
to the aggregate amount of unpaid salary through October 31, 2000. If the
Company maintains key person life insurance on the executive, the payment will
be made upon receipt of the policy's proceeds. Otherwise, the payment will be
made over the term of the executive's employment agreement. If employment
terminates as a result of disability, the executive officer will continue to
receive salary and benefits through October 31, 2000, offset by any government
benefits and any benefits the employee receives under disability insurance
provided by the Company.
Stock Option Plan
The Company adopted the Signature Eyewear, Inc. 1997 Stock Plan (the "Stock
Plan") in May 1997. The purpose of the Stock Plan is to attract, retain and
motivate certain key employees of the Company and its subsidiaries by giving
them incentives which are linked directly to increases in the value of the
Company's Common Stock. Each executive officer, other employee, non-employee
director or consultant of the Company or any of its subsidiaries is eligible
to be considered for the grant of awards under the Stock Plan. A maximum of
800,000 shares of Common Stock may be issued pursuant to awards granted under
the Stock Plan, subject to certain adjustments to prevent dilution. No person
may receive awards representing more than 25% of the number of shares of
Common Stock covered by the Stock Plan (200,000 shares). Any shares of Common
Stock subject to an award which for any reason expires or terminates
unexercised are again available for issuance under the Stock Plan. The Stock
Plan terminates in 2007.
The Stock Plan authorizes its administrator to enter into any type of
arrangement with an eligible participant that, by its terms, involves or might
involve the issuance of (i) shares of Common Stock, (ii) an option, warrant,
convertible security, stock appreciation right or similar right with an
exercise or conversion privilege at a price related to the Common Stock, or
(iii) any other security or benefit with a value derived from the value of the
Common Stock. Any stock option granted pursuant to the Stock Plan may be an
incentive stock option within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended, or a nonqualified stock option.
In November 1999, the Board of Directors established a Compensation
Committee and delegated to the Compensation Committee the authority to
administer the Stock Plan. Before November 1999, the Board of Directors
administered the Stock Plan. Subject to the provisions of the Stock Plan, the
Compensation Committee will have full and final authority to select the
participants to whom awards will be granted thereunder, to grant the awards
and to determine the terms and conditions of the awards and the number of
shares to be issued pursuant to awards.
Deferred Compensation Plan
Effective as of January 1, 2000, the Company adopted the Signature Eyewear,
Inc. Key Employee Deferred Compensation Plan (the "Deferred Compensation
Plan"), a non-qualified deferred compensation plan. The Deferred Compensation
Plan is intended to permit the Company's key employees and directors to defer
compensation in excess of the limits permitted under the Company's tax-
qualified 401(k) plan and to defer taxation on the earnings attributable to
compensation deferred under the Deferred Compensation Plan. Participation is
limited to a select group of management and highly compensated employees
specifically
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<PAGE>
approved by the Compensation Committee. Members of the Board of Directors are
also eligible to participate. Participation is voluntary and eligible
participants may elect to defer up to 90% of salary, commissions, overrides or
director fees and up to 100% of bonuses. The Company credits a matching
allocation in the amount of 50% of a participant's deferrals of up to 6% of
total compensation. For non-sales employees, the Company match vests at a rate
of 20% per year and is fully vested after five years of service. The annual
Company match for sales employees will vest at a rate of 20% per year over the
five years after the year such match is credited on behalf of the participant.
The Deferred Compensation Plan provides accelerated vesting in the event of a
participant's death prior to termination of employment, in the event the
participant is subject to an involuntary termination within 12 months after a
change in control of the Company and a partial acceleration if the Deferred
Compensation Plan is terminated.
10
<PAGE>
PERFORMANCE GRAPH
The following graph sets forth the percentage change in cumulative total
shareholder return of the Company's Common Stock during the period from
September 11, 1997 (the date the Company's initial public offering commenced)
to October 31, 1999, compared with the cumulative returns of the Nasdaq Stock
Market (US Companies) Index and the Russell 2000 Index. The Comparison assumes
$100 was invested on September 11, 1997 in the Common Stock and in each of the
foregoing indices. The stock price performance on the following graph is not
necessarily indicative of future stock price performance.
COMPARISON OF CUMULATIVE TOTAL RETURN* AMONG
SIGNATURE EYEWEAR, INC., THE NASDAQ STOCK
MARKET (U.S.) INDEX AND THE RUSSELL 2000 INDEX
[PERFORMANCE GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
Cumulative Total Return
----------------------------------
9/11/97 10/31/97 10/31/98 10/31/99
------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Siganture Eyewear, Inc.......... SEYE $100 $ 95 $ 46 $ 35
NASDAQ Stock Market (U.S.)...... INAS 100 100 112 188
Russell 2000.................... IR20 100 103 92 100
</TABLE>
11
<PAGE>
OTHER INFORMATION
Principal Shareholders
The following table sets forth as of March 1, 2000 certain information
relating to the ownership of the Common Stock by (i) each person known by the
Company to be the beneficial owner of more than five percent of the
outstanding shares of the Company's Common Stock, (ii) each of the Company's
directors, (iii) each of the Named Executive Officers, and (iv) all of the
Company's executive officers and directors as a group. Except as may be
indicated in the footnotes to the table and subject to applicable community
property laws, each such person has the sole voting and investment power with
respect to the shares owned. The address of each person listed is in care of
the Company, 498 North Oak Street, Inglewood, California 90302.
<TABLE>
<CAPTION>
Number of Shares of
Common Stock
Name and Address Beneficially Owned (1) Percent (1)
---------------- --------------------- -----------
<S> <C> <C>
The Weiss Family Trust(2).................. 2,090,972 41.3%
Bernard Weiss(2)(3)........................ 2,106,972 41.5
Julie Heldman(2)(3)........................ 2,106,972 41.5
Daniel Warren(4)........................... 319,208 6.3
Robert Fried(5)............................ 215,599 4.2
Robert Zeichick(5)......................... 216,689 4.3
Michael Prince(5).......................... 136,941 2.7
Maurice Buchsbaum(6)....................... 29,500 *
Joel Johnson(7)............................ 12,420 *
Directors and executive officers as a group
(8 persons)(8)............................ 3,053,329 58.2%
</TABLE>
- --------
* Less than one percent.
(1) Under Rule 13d-3, certain shares may be deemed to be beneficially owned
by more than one person (if, for example, persons share the power to vote
or the power to dispose of the shares). In addition, shares are deemed to
be beneficially owned by a person if the person has the right to acquire
the shares (for example, upon exercise of an option) within 60 days of
the date as of which the information is provided. In computing the
percentage ownership of any person, the amount of shares outstanding is
deemed to include the amount of shares beneficially owned by such person
(and only such person) by reason of these acquisition rights. As a
result, the percentage of outstanding shares of any person as shown in
this table does not necessarily reflect the person's actual ownership or
voting power with respect to the number of shares of Common Stock
actually outstanding at March 1, 2000.
(2) Bernard Weiss and Julie Heldman are married. Mr. Weiss and Ms. Heldman
are co-trustees of The Weiss Family Trust, and have voting and investment
power for shares held by The Weiss Family Trust.
(3) Includes 16,000 shares of Common Stock reserved for issuance upon
exercise of stock options which currently are exercisable or will become
exercisable before April 29, 2000.
(4) Includes 8,000 shares of Common Stock reserved for issuance upon exercise
of stock options which currently are exercisable or will become
exercisable before April 29, 2000.
(5) Includes 37,000 shares of Common Stock reserved for issuance upon
exercise of stock options which currently are exercisable or will become
exercisable before April 29, 2000.
(6) Includes 26,500 shares of Common Stock reserved for issuance upon
exercise of stock options and warrants which currently are exercisable or
will become exercisable before April 29, 2000.
(7) Includes 10,500 shares of Common Stock reserved for issuance upon
exercise of warrants which currently are exercisable.
(8) Includes 188,000 shares of Common Stock reserved for issuance upon
exercise of stock options and warrants which currently are exercisable or
will become exercisable before April 29, 2000.
12
<PAGE>
SHAREHOLDER PROPOSALS
Any shareholder who intends to present a proposal at the next Annual
Meeting of Shareholders, for inclusion in the Company's Proxy Statement and
Proxy form relating to such Annual Meeting, must submit that proposal to the
Company at its principal executive offices by December 5, 2000.
INDEPENDENT PUBLIC ACCOUNTANTS
Altschuler, Melvoin and Glasser LLP, independent public accountants, were
selected by the Board of Directors to serve as independent public accountants
of the Company for the year ended October 31, 1999, and have been selected by
the Board of Directors to serve as independent auditors for the fiscal year
ending October 31, 2000. Representatives of Altschuler, Melvoin and Glasser
LLP are expected to be present at the Annual Meeting, and will be afforded the
opportunity to make a statement if they desire to do so, and will be available
to respond to appropriate questions from shareholders.
SOLICITATION OF PROXIES
It is expected that the solicitation of proxies will be primarily by mail.
The cost of solicitation by management will be borne by the Company. The
Company will reimburse brokerage firms and other persons representing
beneficial owners of shares for their reasonable disbursements in forwarding
solicitation material to those beneficial owners. Proxies may also be
solicited by certain of the Company's directors and officers, without
additional compensation, personally or by mail, telephone, telegram or
otherwise for the purpose of soliciting such proxies.
ANNUAL REPORT ON FORM 10-K
THE COMPANY'S ANNUAL REPORT ON FORM 10-K, WHICH HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION FOR THE YEAR ENDED OCTOBER 31, 1999, WILL
BE MADE AVAILABLE TO SHAREHOLDERS WITHOUT CHARGE UPON WRITTEN REQUEST TO
MICHAEL PRINCE, CHIEF FINANCIAL OFFICER, 498 NORTH OAK STREET, INGLEWOOD,
CALIFORNIA 90302, U.S.A.
ON BEHALF OF THE BOARD OF DIRECTORS
/s/ Julie Heldman
Julie Heldman
Co-Chairman of the Board, President and
Secretary
Inglewood, California 90302
April 3, 1999
13
<PAGE>
- --------------------------------------------------------------------------------
SIGNATURE EYEWEAR, INC.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS
The undersigned, a shareholder of SIGNATURE EYEWEAR, INC., a California
corporation (the "Company") hereby appoints Bernard Weiss and Julie Heldman,
and each of them, the proxy of the undersigned, with full power of
substitution, to attend, vote and act for the undersigned at the Company's
Annual Meeting of Shareholders (the "Annual Meeting"), to be held on April 28,
2000, and at any of its postponements or adjournments, to vote and represent
all of the shares of the Company which the undersigned would be entitled to
vote, as follows:
The Board of Directors recommends a WITH vote on Proposal 1.
1. ELECTION OF DIRECTORS, as provided in the Company's Proxy Statement:
[_] WITH [_] WITHOUT Authority to vote for the nominees listed below.
(Instructions: To withhold authority for a nominee, line through or
otherwise strike out the name of the nominee below)
Bernard Weiss, Julie Heldman, Michael Prince, Daniel Warren, Maurice Buchsbaum,
Joel Johnson
The undersigned hereby revokes any other proxy to vote at the Annual Meeting,
and hereby ratifies and confirms all that the proxy holder may lawfully do by
virtue of this Proxy. As to any other business that may properly come before
the Annual Meeting and any of its postponements or adjournments, the proxy
holder is authorized to vote in accordance with his or her best judgment.
This Proxy will be voted in accordance with the instructions set forth above.
This Proxy will be treated as a GRANT OF AUTHORITY TO VOTE FOR the election of
the Directors named, and as the proxy holder shall deem advisable on any other
business that may come before the Annual Meeting, unless otherwise directed.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The undersigned acknowledges receipt of a copy of the Notice of Annual
Meeting and accompanying Proxy Statement dated April 3, 2000 relating to the
Annual Meeting.
Date: ________________________, 2000
____________________________________
____________________________________
Signature(s) of Shareholder(s)
(See Instructions Below)
The above signature(s) should
correspond exactly with the name(s)
of the shareholder(s) appearing on
the Stock Certificate. If stock is
jointly held, all joint owners
should sign. When signing as
attorney, executor, administrator,
trustee or guardian, please give
full title as such. If signer is a
corporation, please sign the full
corporation name, and give title of
signing officer.
THIS PROXY IS SOLICITED BY THE
BOARD
OF DIRECTORS OF SIGNATURE EYEWEAR,
INC.
- --------------------------------------------------------------------------------
