<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
<TABLE>
<S> <C>
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 Section240.14a-11(c) or
Section240.14a-12
</TABLE>
<TABLE>
<C> <S>
I.C. ISAACS & COMPANY, INC.
- ------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
EUGENE C. WIELEPSKI, VICE PRESIDENT--FINANCE,
CHIEF FINANCIAL OFFICER AND CORPORATE SECRETARY
- ------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/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:
----------------------------------------------------------
(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:
----------------------------------------------------------
</TABLE>
<PAGE>
I.C. ISAACS & COMPANY, INC.
3840 Bank Street
Baltimore, Maryland 21224-2522
(410) 342-8200
April 28, 2000
To Our Stockholders:
On behalf of our Directors, I cordially invite you to attend the Annual
Meeting of Stockholders of I.C. Isaacs & Company, Inc. The Annual Meeting will
be held at 11:00 a.m., local time, on Thursday, June 8, 2000, at the Best
Western and Conference Center, 5625 O'Donnell Street, Baltimore, Maryland 21224.
The formal Notice of the Annual Meeting is attached hereto.
The Proxy Statement describes matters that we expect will be acted upon at
the Annual Meeting. The stockholders who are present will have the opportunity
to ask questions.
We are gratified by our stockholders' interest in the Company and hope that
many of you vote your shares in person or by proxy. We urge you to return your
proxy card as soon as possible.
Cordially yours,
Robert J. Arnot
Chairman of the Board, Chief Executive
Officer and President
<PAGE>
I.C. ISAACS & COMPANY, INC.
3840 Bank Street
Baltimore, Maryland 21224-2522
(410) 342-8200
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 8, 2000
------------------------
NOTICE IS HEREBY GIVEN that the 2000 Annual Meeting of Stockholders (the
"Meeting") of I.C. ISAACS & COMPANY, INC. (the "Company") will be held on
Thursday, June 8, 2000, at the Best Western and Conference Center, 5625
O'Donnell Street, Baltimore, Maryland 21224, at 11:00 a.m., local time. The
Meeting will be held for the following purposes:
1. To elect three Class III directors, each for a term of three years
and/or until their successors are elected and qualified;
2. To ratify the appointment of BDO Seidman, LLP as the Company's
independent auditors for the fiscal year ending December 31, 2000; and
3. To transact such other business as may properly come before the
Meeting or any adjournments or postponements thereof.
The Board of Directors has fixed the close of business on April 21, 2000, as
the record date for the determination of the stockholders entitled to notice of,
and to vote at, the Meeting and any adjournments or postponements thereof. Only
those stockholders of record of the Company as of the close of business on that
date will be entitled to vote at the Meeting or any adjournments or
postponements thereof. Accompanying this notice is a Proxy Card and Proxy
Statement and a copy of the Company's 1999 Annual Report on Form 10-K.
By Order of the Board of Directors
Robert J. Arnot
Chairman of the Board, Chief Executive
Officer and President
Eugene C. Wielepski
Vice President--Finance, Chief
Financial Officer and Corporate
Secretary
Baltimore, Maryland
April 28, 2000
YOU ARE CORDIALLY INVITED TO ATTEND THIS MEETING. IT IS IMPORTANT THAT YOUR
SHARES BE REPRESENTED REGARDLESS OF THE NUMBER YOU OWN. IF YOU WILL BE UNABLE TO
BE PRESENT AT THE MEETING OR EVEN IF YOU ANTICIPATE THAT YOU WILL ATTEND, PLEASE
SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE ACCOMPANYING ENVELOPE
WITHOUT DELAY. YOU WILL BE MOST WELCOME AT THE MEETING AND MAY THEN VOTE IN
PERSON IF YOU SO DESIRE, EVEN THOUGH YOU MAY HAVE EXECUTED AND RETURNED THE
PROXY. ANY STOCKHOLDER WHO EXECUTES SUCH A PROXY MAY REVOKE IT AT ANY TIME
BEFORE IT IS EXERCISED. YOUR PROMPT RETURN OF YOUR PROXY WILL HELP AVOID THE
COST OF FURTHER SOLICITATIONS.
<PAGE>
I.C. ISAACS & COMPANY, INC.
3840 Bank Street
Baltimore, Maryland 21224-2522
(410) 342-8200
------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 8, 2000
------------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
GENERAL
This Proxy Statement, the Notice of Annual Meeting of Stockholders, and the
accompanying Proxy Card are furnished to stockholders of I.C. Isaacs & Company,
Inc. (the "Company") in connection with the solicitation of proxies by the
Company's Board of Directors to be used at the 2000 Annual Meeting of
Stockholders of the Company (the "Meeting") to be held on Thursday, June 8,
2000, and any adjournments or postponements thereof. The Meeting will be at the
Best Western and Conference Center, 5625 O'Donnell Street, Baltimore, Maryland
21224, at 11:00 a.m., local time. The Meeting will be held for the following
purposes:
1. To elect three Class III directors, each for a term of three years
and/or until their successors are elected and qualified;
2. To ratify the appointment of BDO Seidman, LLP as the Company's
independent auditors for the fiscal year ending December 31, 2000; and
3. To transact such other business as may properly come before the
Meeting or any adjournments or postponements thereof.
This Proxy Statement and the accompanying Notice of Annual Meeting of
Stockholders, Proxy Card and the Company's 1999 Annual Report on Form 10-K
containing the Company's consolidated financial statements for the year ended
December 31, 1999 are first being mailed to stockholders on or about April 28,
2000.
RECORD DATE AND PRINCIPAL STOCKHOLDERS
Stockholders of record at the close of business on April 21, 2000 (the
"Record Date") are entitled to notice of, and to vote at, the Meeting and any
adjournments or postponements thereof. On the Record Date, the Company had
outstanding and entitled to vote 7,197,990 shares of Common Stock, par value
$.0001 per share (the "Common Stock"). For information regarding security
ownership by management and certain other holders of the Company's Common Stock,
see "Security Ownership of Certain Beneficial Owners and Management."
VOTING AND SOLICITATION
With respect to the proposal regarding election of Class III directors,
stockholders may (a) vote in favor of all nominees, (b) withhold their votes as
to all nominees, or (c) withhold their votes as to any specific nominee by so
indicating in the appropriate space on the enclosed Proxy Card. With respect to
the proposal to ratify the appointment of BDO Seidman, LLP as the Company's
independent auditors for the fiscal year ending December 31, 2000, stockholders
may (a) vote FOR, (b) vote AGAINST or (c) ABSTAIN from voting as to each such
matter. All properly executed Proxy Cards delivered by stockholders and not
revoked will be voted at the Meeting in accordance with the directions given.
Properly executed proxies not marked to indicate any desired vote will be voted
FOR the election of the nominees for directors named below, and FOR the
ratification of the appointment of BDO Seidman, LLP as the Company's independent
auditors for the fiscal year ending December 31, 2000. If any other matters are
properly brought before the
<PAGE>
Meeting, the persons named in the accompanying proxies will vote the shares
represented by such proxies on such matters as instructed by the Board of
Directors of the Company, who have instructed the proxies to vote in accordance
with the proxies' own best judgment in the absence of express instruction from
the Board.
The expenses of preparing, printing, and mailing the proxy materials will be
borne by the Company. In addition to the use of the mail, proxies may be
solicited by directors and officers of the Company in person or by telephone or
telegram. The Company will also reimburse brokerage houses and other custodians,
nominees and fiduciaries for their expenses, in accordance with Securities and
Exchange Commission (the "SEC") regulations, in sending this proxy statement and
proxies to the beneficial owners of its Common Stock.
REVOCABILITY OF PROXIES
A proxy is enclosed for use at the Meeting. Each stockholder is urged to
complete and return the enclosed proxy immediately, even if the stockholder
anticipates attending the Meeting in person. The Board of Directors has selected
Messrs. Robert J. Arnot and Eugene C. Wielepski, and each of them, to act as
proxies with full power of substitution. Any stockholder executing a proxy has
the power to revoke the proxy at any time before it is voted by delivering to
the Secretary of the Company a notice of revocation or a duly executed proxy
bearing a later date. Any proxy may also be revoked by (i) the stockholder's
attendance at the Meeting, (ii) filing a written notice of revocation with the
Secretary of the Meeting, and (iii) voting in person. The presence of a
stockholder at the Meeting will not automatically revoke that stockholder's
proxy. All notices of revocation should be sent to the attention of the
Company's Corporate Secretary, Eugene C. Wielepski, I.C. Isaacs & Company, Inc.,
3840 Bank Street, Baltimore, Maryland 21224-2522.
QUORUM AND VOTING RIGHTS
The presence, in person or represented by proxy, of at least a majority of
the total number of outstanding shares of the Company's Common Stock is
necessary to constitute a quorum at the Meeting. Shares of Common Stock
represented by a properly signed and returned proxy will be counted as present
at the Meeting for purposes of determining a quorum, without regard to whether
the proxy is marked as casting a vote or abstaining. Shares of Common Stock held
by nominees that are voted on at least one matter coming before the Meeting will
also be counted as present for purposes of determining a quorum, even if the
beneficial owner's discretion has been withheld (a "broker non-vote") for voting
on some or all other matters.
Each share of Common Stock is entitled to one vote on all matters that may
properly come before the Meeting other than the election of directors. In the
election of directors, each share is entitled to cast one vote for each director
to be elected. Directors of the Company shall be elected by a plurality of votes
cast at the Meeting. The holders of Common Stock may not vote their shares
cumulatively for the election of directors. For purposes of the election of
directors, abstentions and broker non-votes are not considered to be votes cast
and do not affect the plurality vote required for the election of directors. All
other matters to come before the Meeting require the approval of a majority of
the shares of Common Stock present, in person or by proxy, at the Meeting and
entitled to vote. Therefore, abstentions will have the same effect as votes
against the proposals on such matters. Broker non-votes, however, will be deemed
shares not present to vote on such matters, and therefore will not count as
votes for or against the proposals, and will not be included in calculating the
number of votes necessary for approval of such matters.
2
<PAGE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Amended and Restated Bylaws of the Company provide that the number of
directors constituting the Board of Directors shall be as determined from time
to time by the Board. The Board has acted to fix the number of directors at
nine.
Pursuant to the terms of the Company's Amended and Restated Certificate of
Incorporation, the Board of Directors is divided into three classes, as nearly
equal in number as reasonably possible, with terms expiring at the Meeting
("Class III"), the 2001 Annual Meeting of Stockholders ("Class I") and at the
2002 Annual Meeting of Stockholders ("Class II"), respectively. Mr. Gerald W.
Lear, who had previously served as a Class II director of the Company and as its
President and Chief Operating Officer, resigned as an officer, director and
employee of the Company in June 1999. The Board of Directors has not filled the
vacancy on the Board created by Mr. Lear's resignation.
The Company's Board of Directors met on nine occasions in 1999. Each of
Messrs. Robert J. Arnot, Eugene C. Wielepski, Ronald S. Schmidt, Neal J. Fox,
Anthony J. Marterie, Thomas P. Ormandy, Daniel J. Gladstone and Jon Hechler
attended at least 75% of the aggregate of the total number of meetings of the
Board of Directors and the total number of meetings of all committees on which
they served. During the portion of 1999 in which he served as a director,
Mr. Lear attended four of the meetings of the Board that were held. The Board of
Directors has standing Audit and Compensation Committees as described below. The
Company does not have a Nominating Committee.
AUDIT COMMITTEE. The Audit Committee consists of Messrs. Ronald S. Schmidt
(Chairman), Neal J. Fox and Anthony J. Marterie. The Audit Committee is
responsible for recommending to the Board of Directors the engagement of the
independent auditors of the Company and reviewing with the independent auditors
the scope and results of the audits, the internal accounting controls of the
Company, audit practices and the professional services furnished by the
independent auditors. All of the members of the Audit Committee are independent,
as such term is defined in the National Association of Securities Dealers
listing standards. The Audit Committee has not adopted a written charter, but
expects to do so prior to June 15, 2000. Two meetings of the Audit Committee
were held in 1999. Each of the members of the Audit Committee attended both of
the meetings of the Audit Committee.
COMPENSATION COMMITTEE. During 1999, the Compensation Committee consisted
of Messrs. Jon Hechler (Chairman), Neal J. Fox and Ronald S. Schmidt. The
Compensation Committee reviews and determines the compensation of the Company's
executive officers and recommends the granting of awards to eligible employees
pursuant to the Company's Amended and Restated 1997 Omnibus Stock Plan. See
"Compensation Committee Report on Executive Officer Compensation," below. Two
meetings of the Compensation Committee were held in 1999 and all members
attended each meeting.
DIRECTORS' COMPENSATION
Directors who are employees of the Company receive no compensation for
serving on the Board of Directors. Directors who are not employees of the
Company (the "Outside Directors") receive an annual retainer fee of $10,000 for
their services and attendance fees of $750 per Board or committee meeting
attended. All directors are reimbursed for expenses incurred in connection with
attendance at Board or committee meetings. In addition, members of the Board of
Directors are eligible to participate in the Company's Amended and Restated 1997
Omnibus Stock Plan. In 1999, Outside Directors were awarded non-qualified stock
options to purchase 15,000 shares of Common Stock at an exercise price of
$1.6875 per share.
PROPOSAL 1: ELECTION OF THREE CLASS III DIRECTORS
At the Meeting, three directors are to be elected as Class III directors,
each for a term of three years, or until their successors have been elected and
qualified. The Board of Directors has nominated for
3
<PAGE>
election as Class III directors, Messrs. Ronald S. Schmidt, Neal J. Fox and
Anthony J. Materie, each of whom currently serves on the Board as a Class III
director. The proxies solicited hereby, unless directed to the contrary therein,
will be voted FOR the Board nominees for Class III directors. All of the
nominees for Class III directors have consented to being named in this Proxy
Statement and to serve if elected. The Board has no reason to believe that any
nominee for election as a Class III director will not be a candidate or will be
unable to serve, but if either event occurs, it is intended that the shares
represented by proxies will be voted FOR such substituted nominee or nominees as
the Board, in its discretion, may designate.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR THE
ELECTION OF ITS NOMINEES FOR CLASS III DIRECTORS.
The following sets forth certain biographical information, present
occupation and business experience for the past five years for each of the
nominees for election as Class III directors and for each of the Class I and
Class II incumbent directors.
CLASS III: INCUMBENTS WHOSE TERMS EXPIRE AT THE 2000 ANNUAL MEETING OF
STOCKHOLDERS.
RONALD S. SCHMIDT, age 56, has been a director of the Company since 1990. He
is President and Chief Executive Officer of I.B. Diffusion, a manufacturer of
ladies' apparel.
NEAL J. FOX, age 66, has been a director of the Company since
February 1998. From 1989 through March 1999, he served as the President and
Chief Executive Officer of Sulka, an international menswear retailer.
ANTHONY J. MARTERIE, age 61, has been a director of the Company since
February 1998. Since 1989 he has served as the President and Chief Executive
Officer of North Coast Industries, a producer and distributor of casual women's
sportswear under the Blast brand, which is not competitive with the Company's
brands.
CLASS I: INCUMBENTS WHOSE TERMS EXPIRE AT THE 2001 ANNUAL MEETING OF
STOCKHOLDERS.
ROBERT J. ARNOT, age 51, has been a director of the Company since 1984,
Chairman of the Board of Directors since 1991, Chief Executive Officer since
1996 and President since 1999. He was Vice President of Planning and Corporate
Development from 1989 to 1991. He has been employed by the Company since 1989.
EUGENE C. WIELEPSKI, age 53, has been a director, Vice President--Finance
and Chief Financial Officer of the Company since 1991. He has also held the
positions of Secretary and Treasurer since 1976. From 1976 to 1990 he was
Controller. He is a Certified Public Accountant and has been employed by the
Company since 1973.
CLASS II: NOMINEES WHOSE TERMS WILL EXPIRE AT THE 2002 ANNUAL MEETING OF
STOCKHOLDERS.
JON HECHLER, age 47, has been a director of the Company since 1984. He was
employed by Ira J. Hechler and Associates, an investment company, from 1980 to
1999. He is President of T. Eliot, Inc., a manufacturer of bathroom equipment.
DANIEL J. GLADSTONE, age 43, has been a director since April 1999 and
President--Girbaud Division since January 1999. He reports directly to
Mr. Arnot and is responsible for the sales and marketing of the Girbaud lines.
Mr. Gladstone served as President of Calvin Klein Jeans at WARNACO, Inc. from
1997 to 1998 and as President of Calvin Klein Jeans at Designer Holding Ltd.
from 1994 to 1997.
THOMAS P. ORMANDY, age 49, has been a director since 1998 and Vice
President--Sales of the Company since 1986. He is responsible for the sales and
marketing of the BOSS men's and boys' lines, the Beverly Hills Polo Club men's
and boys' lines and the UBX (Urban Expedition) men's line.
4
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following Summary Compensation Table sets forth the compensation for the
past three years of each of the Company's five most highly compensated officers,
including the Chief Executive Officer (collectively, the "Named Executive
Officers"):
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION ALL OTHER
AWARDS COMPENSATION
ANNUAL COMPENSATION (1) ------------------ --------------------------
------------------------------ NUMBER OF SHARES
NAME AND PRINCIPAL POSITIONS YEAR SALARY BONUS UNDERLYING OPTIONS
- ---------------------------- -------- -------- -------- ------------------
<S> <C> <C> <C> <C> <C>
Robert J. Arnot (2)................ 1999 $352,711 -- 55,000 --
Chairman of the Board and 1998 396,686 -- 30,000 --
Chief Executive Officer 1997 379,542 -- -- --
Gerald W. Lear (2)................. 1999 $121,998 -- 55,000 $ 225,000(3)
President and 1998 406,042 -- 30,000 --
Chief Operating Officer 1997 386,918 -- -- --
Daniel J. Gladstone (4)............ 1999 $320,243 -- 477,000 --
President--Girbaud Division 1998 -- -- -- --
1997 -- -- -- --
Eugene C. Wielepski (2)............ 1999 $175,873 -- 27,500 --
Vice President--Finance and 1998 197,808 -- 15,000 --
Chief Financial Officer 1997 190,885 -- -- --
Thomas P. Ormandy.................. 1999 $265,788 -- 33,750 --
Vice President--Sales 1998 295,812 -- 15,000 --
1997 301,581 -- -- --
Marc Baff.......................... 1999 $160,646 -- 10,000 --
Vice President--Sales 1998 193,998 -- 10,000 --
1997 119,150 -- -- --
</TABLE>
- ------------------------
(1) The Company also provides certain perquisites and other benefits. The
aggregate dollar cost to the Company of such perquisites and other benefits
in each of the last three years did not exceed the lesser of $50,000 or 10%
of the amount reflected in the Salary and Bonus columns for any of the Named
Executive Officers.
(2) In his capacity as a stockholder of the Company, this Named Executive
Officer (a) was reimbursed during 1997 for payment of taxes on income of the
Company that was passed through to the stockholders and (b) received, in
connection with the Company's initial public offering in 1997, a dividend
distribution representing a portion of the earned but undistributed
S corporation earnings of the Company.
(3) Mr. Lear resigned as an officer, director and employee of the Company in
June 1999. Mr. Lear received $175,000 in severance payments and a key man
life insurance policy valued of $50,000, which was turned over to Mr. Lear
upon his resignation.
(4) Mr. Gladstone earned a bonus of $18,022 in 1999, which became payable in
March 2000.
5
<PAGE>
OPTION GRANTS IN THE LAST FISCAL YEAR
The following table sets forth information regarding options to purchase
shares of the Company's Common Stock granted to the Named Executive Officers
during the last fiscal year:
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
--------------------------------------------------- VALUE OF ASSUMED
NUMBER OF ANNUAL RATES OF STOCK
SECURITIES PERCENT OF PRICE APPRECIATION FOR
UNDERLYING TOTAL OPTIONS EXERCISE OPTION TERM (2)
OPTIONS GRANTED TO PRICE PER EXPIRATION -----------------------
NAME GRANTED EMPLOYEES SHARE(1) DATE 5% 10%
- ---- ---------- ------------- --------- ---------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Robert J. Arnot..................... 25,000 2.5 $1.1875 2/11/09 $18,563 $ 47,313
30,000 3.0 1.1875 6/3/09 22,275 56,775
Gerald W. Lear(3)................... 25,000 2.5 1.1875 2/11/09 18,563 47,313
30,000 3.0 1.1875 6/3/09 22,275 56,775
Daniel J. Gladstone................. 244,000 24.1 1.5625 4/21/09 240,950 606,950
233,000 23.0 1.1875 6/3/09 173,003 440,953
Eugene C. Wielepski................. 12,500 1.2 1.1875 2/11/09 9,281 23,656
15,000 1.5 1.1875 6/3/09 11,138 28,388
Thomas P. Ormandy................... 18,750 2.0 1.1875 2/11/09 13,922 35,484
15,000 1.5 1.1875 6/3/09 11,138 28,388
</TABLE>
- ------------------------------
(1) The exercise price equaled the fair market value of the Common Stock as
determined by the Board of Directors on the date of grant.
(2) The assumed annual rates of appreciation of 5% and 10% would result in the
price of the Common Stock increasing to $1.93 and $3.08, respectively, from
the exercise price of $1.1875 per share, and $2.55 and $4.05, respectively,
from the exercise price of $1.5625 per share, during the 10-year term of the
options. The vesting of unvested options may be accelerated at any time by
the Company. The 5% and 10% assumed annual rates of stock price appreciation
used to calculate potential gains to optionees are mandated by the rules of
the SEC. The potential realizable value does not represent the Company's
prediction of its stock price performance. There can be no assurance that
the stock price will actually appreciate over the 10-year option term at the
assumed 5% and 10% levels or at any other level.
(3) Mr. Lear resigned as President and Chief Operating Officer of the Company in
June 1999.
OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END HOLDINGS.
The following table sets forth information concerning the number and value
of unexercised options to purchase shares of the Company's Common Stock held at
the end of the fiscal year by the Named Executive Officers. No options were
exercised by any of the Named Executive Officers in 1999.
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
IN-THE-MONEY
NUMBER OF OPTIONS
SECURITIES AT YEAR END
SHARES ACQUIRED VALUE UNDERLYING OPTIONS EXERCISABLE/
NAME UPON EXERCISE REALIZED AT YEAR END(1) UNEXERCISABLE(1)
- ---- --------------- -------- ------------------ --------------------
<S> <C> <C> <C> <C>
Robert J. Arnot..................... 0 0 55,000 13,750
Gerald W. Lear...................... 0 0 55,000 13,750
Daniel J. Gladstone................. 0 0 477,000 58,250
Eugene C. Wielepski................. 0 0 27,500 6,875
Thomas P. Ormandy................... 0 0 33,750 8,438
Marc Baff........................... 0 0 10,000 0
</TABLE>
- ------------------------------
(1) The only options shown in the table that were exercisable as of
December 31, 1999 were those held by Mr. Lear, which became immediately
exercisable upon his resignation on June 30, 1999.
6
<PAGE>
DEFINED BENEFIT PENSION PLAN
The Company maintains a defined benefit pension plan (the "Pension Plan")
for its employees. The normal retirement benefit, payable at age 65, is 20.0% of
base compensation up to $10,000 plus 39.5% of base compensation over $10,000,
prorated for service less than 30 years. A reduced benefit is also payable on
early retirement, after age 55 and after 15 years of service. The Pension Plan
also provides disability retirement and death benefits. The Company pays the
full cost of the benefits under the Pension Plan through its contributions to a
trust. The Company's cash contributions to the Pension Plan during the year
ended December 31, 1999 aggregated approximately $1.2 million.
The Pension Plan Table below provides the estimated annual benefits payable
under the Pension Plan upon retirement in specified compensation and years of
service classifications:
PENSION PLAN TABLE
<TABLE>
<CAPTION>
REMUNERATION YEARS OF SERVICE
- ------------ ----------------------------------------------------
15 20 25 30 35
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$100,000...................................... $ 13,838 $ 18,451 $ 23,063 $ 27,676 $ 27,676
125,000....................................... 13,838 18,451 23,063 27,676 27,676
150,000....................................... 13,838 18,451 23,063 27,676 27,676
175,000....................................... 13,838 18,451 23,063 27,676 27,676
200,000....................................... 13,838 18,451 23,063 27,676 27,676
225,000....................................... 13,838 18,451 23,063 27,676 27,676
250,000....................................... 13,838 18,451 23,063 27,676 27,676
300,000....................................... 13,838 18,451 23,063 27,676 27,676
400,000....................................... 13,838 18,451 23,063 27,676 27,676
450,000....................................... 13,838 18,451 23,063 27,676 27,676
500,000....................................... 13,838 18,451 23,063 27,676 27,676
</TABLE>
The compensation considered in determining benefits under the Pension Plan
(as provided in the column titled "Remuneration") is the annual average
compensation for the five consecutive calendar years producing the highest
average. The compensation considered is limited to $75,000. All amounts of
salary, bonus and other compensation as reported in the Summary Compensation
Table, up to $75,000, are included in compensation considered under the Pension
Plan. The amounts of benefit provided in the Pension Plan Table are the amounts
of benefit payable per year in equal monthly installments for the life
expectancy of the participants (i.e., straight life annuity amounts). The
Pension Plan is integrated with Social Security, and its benefit formula is as
follows: (i) 0.6667% of compensation, multiplied by years of service up to 30
years; plus (ii) 0.65% of compensation in excess of $10,000 multiplied by years
of service up to 30 years.
7
<PAGE>
The estimated credited years of service for each of the Named Executive
Officers were as follows, estimated as of January 1, 2000:
<TABLE>
<CAPTION>
ESTIMATED CREDITED
NAME YEARS OF SERVICE
- ---- ------------------
<S> <C>
Robert J. Arnot............................................. 8
Gerald W. Lear.............................................. 36(1)
Daniel J. Gladstone......................................... 1
Eugene C. Wielepski......................................... 26
Thomas P. Ormandy........................................... 13
Marc Baff................................................... 22
</TABLE>
- ------------------------
(1) Upon his resignation as an officer, director and employee of the Company in
June 1999, Gerald W. Lear received a lump sum payment of $176,848 in payment
of all amounts accrued to him under the Company's Pension Plan.
EMPLOYMENT AGREEMENTS
Prior to its initial public offering in December 1997, the Company entered
into individual employment agreements (the "Executive Employment Agreements")
with each of Messrs. Arnot, Lear, Wielepski and Ormandy. Mr. Lear's Executive
Employment Agreement was terminated in June 1999, when he resigned from the
Company. A Severance and Redemption Agreement between Mr. Lear and the Company,
provides for severance payments of $350,000 per annum to be paid weekly during
the period beginning June 30, 1999 and ending May 15, 2001 and continued
participation by Mr. Lear in Company-sponsored medical and life insurance plans.
The Severance and Redemption Agreement includes noncompetition, nonsolicitation
and confidentiality provisions.
As amended in August 1998 and January and April 2000, the term of each of
the Executive Employment Agreements (other than Mr. Lear's Executive Employment
Agreement) began on May 15, 1997 (the "Effective Date") and will terminate on
the fifth anniversary of the Effective Date in the case of Mr. Arnot, on the
fourth anniversary of the Effective Date in the case of Mr. Wielepski and on the
third anniversary of the Effective Date in the case of Mr. Ormandy. The
Executive Employment Agreements will automatically extend after the initial term
for successive one-year terms, unless notice not to extend is given by either
party at least 60 days prior to the end of the then current term. In addition to
the base salary amounts described below, the Executive Employment Agreements
also provide that the Executives are entitled to participate in any bonus and
stock option plans, programs, arrangements and practices as may be established
from time to time by the Board of Directors of the Company for the benefit of
such executive employees, in accordance with the terms of such plans. Each
Executive is also entitled to certain fringe benefits, including Company-paid
health and life insurance. If any of the Executives is terminated without cause
(as such term is defined in the Executive Employment Agreements), then such
Executive will receive as severance his then current base salary for the
remainder of the term of his Executive Employment Agreement. The Executive will
also continue to participate in Company-sponsored health, life insurance and
other fringe benefit plans and programs during the severance period.
The Executive Employment Agreement of Mr. Arnot initially provided for an
annual base salary of $400,000, which may be increased based on periodic reviews
by the Compensation Committee. Pursuant to amendments to the Executive
Employment Agreement of Mr. Arnot entered into in February 1999, the annual base
salary was reduced to $350,000, provided that the annual base salary will
increase to its initial level for the remainder of the term after the Company
achieves positive net earnings in two consecutive fiscal quarters. The Executive
Employment Agreement of Mr. Arnot includes a two-year noncompetition provision
as well as nonsolicitation and confidentiality provisions.
8
<PAGE>
The Executive Employment Agreement of Messrs. Wielepski and Ormandy
initially provided for annual base salaries of $200,000 and $300,000,
respectively, which may be increased based on periodic reviews by the
Compensation Committee. Pursuant to amendments to such Executive Employment
Agreements entered into in February 1999, the annual base salaries were reduced
to $175,000 and $262,500, respectively, provided that the annual base salaries
will be increased to their initial levels for the remainder of the term after
the Company achieves positive net earnings in two consecutive fiscal quarters.
The Executive Employment Agreements of Messrs. Wielepski and Ormandy include a
one-year noncompetition provision as well as nonsolicitation and confidentiality
provisions.
Upon joining the Company in January 1999, Mr. Gladstone entered into an
employment agreement (the "Gladstone Agreement") with the Company. The Gladstone
Agreement is substantially similar to the Executive Employment Agreements
described above except as described in this paragraph. The Gladstone Agreement
provides for an annual base salary of $350,000, which may be increased based on
periodic reviews by the Compensation Committee. The term of the Gladstone
Agreement began on January 21, 1999 and will terminate on January 21, 2001. The
Gladstone Agreement will automatically extend after the initial term for
successive one-year terms, unless notice not to extend is given by either party
at least 60 days prior to the end of the then current term. In addition to his
base salary and other benefits, Mr. Gladstone is entitled to receive incentive
compensation following each fiscal year during the term in which the Company's
net sales of Girbaud sportswear exceeds $20 million. The amount of such
incentive compensation will be equal to one-half of one percent of the amount by
which the Company's net sales of Girbaud sportswear exceeds $20 million. If
Mr. Gladstone is terminated without cause (as such term is defined in the
Gladstone Agreement), in the event of termination due to non-renewal of the
Gladstone Agreement or in the event of a change of control (as such term is
defined in the Gladstone Agreement) of the Company followed by a voluntary or
involuntary termination of Mr. Gladstone, Mr. Gladstone will receive as
severance (i) the greater of one year's worth of his then current base salary or
his base salary for the remainder of the term and (ii) earned but unpaid
incentive compensation. The Gladstone Agreement includes a 90-day noncompetition
provision (which does not apply in the event Mr. Gladstone is terminated after a
change of control) as well as two-year nonsolicitation and confidentiality
provisions.
AGREEMENTS WITH OTHER KEY PERSONS.
Gary B. Brashers resigned as Vice President--Manufacturing, Chief Executive
Officer and Director of the Company in August 1998. He continues to serve the
Company as a consultant under a consulting agreement and received consulting
payments of $206,654 and $52,250 in 1999 and 1998, respectively.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE OFFICER COMPENSATION
OBJECTIVES
The Company's compensation policies and procedures have historically been
aligned with the Company's entrepreneurial traditions. The Company seeks to
compensate its officers (including the Named Executive Officers) in a manner
which is:
(i) consistent with the Company's conservative traditions and cost
structure;
(ii) sufficient to attract and retain key executives critical to the success
of the Company;
(iii) reflective of current performance of both the individual officer and
the Company; and
(iv) remuneration of successful long-term strategic management and
enhancement of shareholder values.
COMPONENTS OF COMPENSATION
The Compensation Committee (the "Committee") approves the design of,
assesses the effectiveness of, and administers the executive compensation
programs of the Company in support of stockholder interests. The key elements of
the Company's executive compensation program are base salary, annual
9
<PAGE>
incentives and long-term incentive compensation. These key elements are
addressed separately below. In determining each component of compensation, the
Committee considers all elements of an executive's total compensation package.
BASE SALARY
The Committee regularly reviews each executive's base salary. Base salaries
are not necessarily compared to other institutions, although market rates for
comparable executives with comparable responsibilities are considered in some
cases. Base salaries are adjusted by the Committee to recognize varying levels
of responsibility, experience, breadth of knowledge, internal equity issues, as
well as external pay practices. Increases to base salaries are driven primarily
by individual performance. Individual performance is evaluated based on
sustained levels of individual contribution to the Company. In 1998, the annual
base salary of Mr. Arnot, the Company's Chief Executive Officer, was decreased
to $350,000 pursuant to the terms of an amendment to his Executive Employment
Agreement in consideration of the deterioration in the Company's operating
results for 1997 compared to 1998. Also in 1998, the annual base salaries of the
other Named Executive Officers (other than Mr. Gladstone, who joined the Company
in January 1999, and Mr. Baff, who does not have an employment agreement) were
decreased for the same reason. See "Executive Compensation--Employment
Agreements."
ANNUAL INCENTIVES
The annual incentive program promotes the Company's pay-for-performance
philosophy by providing the Chief Executive Officer and other Named Executive
Officers with direct financial incentives in the form of annual cash bonuses to
achieve corporate and, in some cases, individual performance goals. Annual bonus
opportunities allow the Company to communicate specific goals that are of
primary importance during the coming year and motivate executives to achieve
these goals. In March 2000, the Company paid Daniel J. Gladstone a bonus, based
on 1999 performance, of $18,500.
LONG-TERM INCENTIVES
In keeping with the Company's commitment to provide a total compensation
package which includes at-risk components of pay, long-term incentive
compensation comprises a significant portion of the value of an executive's
total compensation package. When awarding long-term grants, the Committee
considers an executive's level of responsibility, prior compensation experience,
historical award data, and individual performance criteria. Long-term incentives
are in the form of stock options awards under the Company's Plan.
Stock options are granted at an option price equal to the fair market value
of the Common Stock on the date of grant. Accordingly, stock options have value
only if the stock price appreciates. This design focuses executives on the
creation of stockholder value over the long term. The size of stock option
grants is based on competitive practice, individual performance factors and
historical award data. The Company granted an aggregate of 648,250 stock options
to the Named Executive Officers in 1999.
CONCLUSION
The Committee believes these executive compensation policies and programs
serve the interests of the Company and its stockholders effectively. The various
compensation vehicles offered are appropriately balanced to provide increased
motivation for executives to contribute to the Company's overall future success,
thereby enhancing the value of the Company for the stockholders' benefit.
We will continue to monitor the effectiveness of the Company's total
compensation program to meet the current and future needs of the Company.
Members of the Compensation Committee:
Jon Hechler, Neal J. Fox and Ronald S. Schmidt
10
<PAGE>
STOCK PERFORMANCE TABLE
The Company is required by the SEC to provide a five-year comparison of the
cumulative total stockholder return on the Company's Common Stock compared with
that of a broad equity market index and either a published industry index or a
Company-constructed peer group index.
The following chart compares the cumulative total stockholder return on the
Company's Common Stock during the period beginning December 18, 1997, (the date
of the Company's initial public offering) and ending December 31, 1999, with the
cumulative total return of the Standard & Poor's 500 Composite Index and a peer
group index. The peer group is comprised of the following companies: Guess ?,
Inc., Liz Claiborne, Inc., Mossimo, Inc., Nautica Enterprises, Inc., Polo Ralph
Lauren Corporation, Tarrant Apparel Group, Tommy Hilfiger Corporation, Tropical
Sportswear Int'l Corporation and V.F. Corporation. Total return for the peer
group is based on market capitalization, weighted for each year. As with the
peer group, the Standard & Poor's 500 Composite Index is market weighted. The
comparison assumes $100 was invested on December 18, 1997, in the Company's
Common Stock and in each of the foregoing indices. It also assumes reinvestment
of any dividends.
The Company does not make, nor does it endorse, any predictions as to future
stock performance.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DOLLARS
<S> <C> <C> <C>
Isaacs I C & Co Inc S&P 500 Comp-Ltd Peer Group Index
12/18/97 100.00 100.00 100.00
12/31/97 101.25 101.64 100.66
3/98 70.00 115.81 124.52
6/98 35.00 119.63 123.53
9/98 20.00 107.75 83.76
12/98 16.25 130.68 103.04
3/99 12.50 137.19 106.64
6/99 11.25 146.86 107.88
9/99 13.75 137.70 86.03
12/99 14.38 158.18 85.50
3/00 26.56 161.80 81.28
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
12/18/97
--------
<S> <C>
I.C. Isaacs & Company, Inc.................................. $100.00
S & P 500 Composite Index................................... $100.00
Peer Group Index............................................ $100.00
</TABLE>
12
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of April 10, 2000 with
respect to the beneficial ownership of the Company's Common Stock (including
shares issuable upon the exercise of outstanding options that are exercisable as
of that date or within 60 days thereafter) by (i) each person (or group of
affiliated persons) who is known by the Company to own beneficially more than
5.0% of the outstanding Common Stock, (ii) each of the Company's directors,
(iii) the Chief Executive Officer and each of the other Named Executive Officers
of the Company, and (iv) all directors and executive officers of the Company as
a group:
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED (2)
----------------------
NAME OF BENEFICIAL OWNERS NUMBER PERCENT(3)
- ------------------------- --------- ----------
<S> <C> <C>
Robert J. Arnot (1).................................... 489,871 6.23 %
Marc Baff.............................................. 12,700 *
Neal J. Fox............................................ -- *
Daniel J. Gladstone.................................... -- *
Jon Hechler (1)(4)..................................... 1,177,152 14.97
Gerald W. Lear (5)..................................... 232,265 3.02
Anthony J. Marterie.................................... -- *
Thomas P. Ormandy...................................... 158,320 2.01
Ronald S. Schmidt...................................... 84,211 *
Eugene C. Wielepski.................................... 194,242 2.47
Wurzburg S.A.(6)....................................... 500,000 6.36
Ambra Inc.(7).......................................... 666,667 8.48
All directors and executive officers as a group
(10 persons)......................................... 2,348,761 29.86 %
</TABLE>
- ------------------------
* Less than one percent.
(1) The business address of such person is c/o I.C. Isaacs & Company, Inc., 3840
Bank Street, Baltimore, Maryland 21224-2522.
(2) Except as described below and subject to certain shareholders agreements and
applicable community property laws and similar laws, each person listed
above has sole voting and investment power with respect to such shares. See
"Certain Relationships and Related Transactions."
(3) Based on percentage of total number of shares outstanding as of April 10,
2000 and to be issued to Ambra Inc. on April 30, 2000.
(4) Includes 811,361 shares held by the Estate of Ira J. Hechler, of which Jon
Hechler is sole executor.
(5) Mr. Lear resigned as an officer, director and employee of the Company in
June 1999.
(6) In August 2000, the Company issued 500,000 shares of restricted Common Stock
to Latitude Licensing Corp. ("Latitude") in connection with the amendment of
a license agreement between the Company and Latitude. Immediately upon
receipt of the Common Stock, Latitude transferred such Common Stock to its
affiliate, Wurzburg S.A. ("Wurzburg"). The address of Wurzburg is 134
Boulevard de la Petrusse, L-2330 Luxembourg.
(7) Pursuant to the restructuring of its licensing arrangement with Ambra Inc.
("Ambra") the Company agreed to issue to Ambra 666,667 shares of restricted
Common Stock on April 30, 2000. The address of Ambra is 645 Fifth Avenue,
New York, New York 10022.
13
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
SECOND RESTATED SHAREHOLDERS' AGREEMENT
The Company's Amended and Restated Shareholders' Agreement dated May 15,
1997, was amended and restated (the "Second Restated Shareholders' Agreement")
in June 1999. No consideration was paid in connection with the execution of the
Second Restated Shareholders' Agreement. The Second Restated Shareholders'
Agreement provides that each of the Shareholders holding, at the time of the
contemplated transfer, in excess of .5% of the outstanding Common Stock of the
Company has granted to each of the other Shareholders and to the Company rights
of first refusal (the "Refusal Right") with respect to the sale of any shares of
the Company's outstanding Common Stock. The Second Restated Shareholders'
Agreement also provides that in the event that a majority of the Shareholders
subject to the Second Restated Shareholders' Agreement agree to enter into a
transaction with a third party for the tender of shares (including, without
limitation, in a change of control transaction), the rights of first refusal set
forth above shall not apply and such Shareholders or the Company may require the
other Shareholders to participate in such transaction on the same terms and
conditions applicable to such Shareholders. The Refusal Right terminates upon
the earlier of May 15, 2001 or upon the Shareholders beneficially owning 30.0%
or less of the shares of Common Stock outstanding. The remainder of the Second
Restated Shareholders' Agreement terminates upon the earlier of May 15, 2003 or
upon the Shareholders beneficially owning 30.0% or less of the shares of Common
Stock outstanding.
TRANSACTIONS WITH LATITUDE LICENSING CORP.
In August 1999, the Company issued 500,000 shares of restricted Common Stock
of the Company to Latitude Licensing Corp. ("Latitude"), the licensor of the
Girbaud mark to the Company, in connection with the amendment of the Company's
license to manufacture and market women's jeanswear, casualwear and outerwear
under the Girbaud mark. The amendment deferred the obligation of the Company to
open a Girbaud retail store. Immediately upon the issuance of the shares,
Latitude transferred the shares to its affiliate Wurzburg S.A. ("Wurzburg"). The
shares are subject to a Shareholders' Agreement dated August 9, 1999 (the
"Latitude Shareholders' Agreement"), which provides that before such shares may
be sold or transferred, the Company shall have a right of first refusal. It also
provides that in the event that shareholders holding a majority of the Common
Stock subject to the Second Restated Shareholders' Agreement (the "Participating
Shareholders") indicate in writing that they will vote in favor of certain
change in control transactions, the Company may require the shareholders subject
to the Latitude Shareholders' Agreement to participate in such transaction on
the same terms and conditions applicable to the Participating Shareholders.
Under the terms of the Latitude Shareholders' Agreement, Latitude was granted
certain piggyback registration rights.
In December 1999, the Company extended the terms of its licenses with
Latitude for the manufacturing and marketing of men's and women's jeanswear and
sportswear until December 31, 2002.
In January 2000, the Company entered into a global sourcing agreement with
an affiliate of Wurzburg, G.I. Promotions, to act as a non-exclusive sourcing
agent to licensees of the Marithe & Francois Girbaud trademark for the
manufacture of Girbaud jeanswear and sportswear. The global sourcing agreement
extends until December 31, 2003 and provides that the Company shall net a
facilitation fee of 5.0% of the total FOB pricing for each order shipped to
licensees under the agreement. Also in January 2000, the Company entered into a
license agreement with Wurzburg. The license has a term of three years and
provides that the Company shall pay Wurzburg a royalty of 1.0% of the total FOB
pricing for each order shipped to a licensee under the global sourcing
agreement.
TRANSACTIONS WITH AMBRA INC.
On October 22, 1999, Isaacs, Ambra Inc. ("Ambra") and Hugo Boss AG ("Hugo
Boss") entered into an agreement to restructure the Company's licensing
arrangement for use of the BOSS trademark.
13
<PAGE>
Pursuant to the agreement (i) the Company transferred to Ambra substantially all
of its rights in the marks containing the term "BOSS" throughout the world,
(ii) an $11.25 million promissory note issued by the Company to Ambra in 1997
was cancelled, (iii) the Company and Ambra agreed to enter into a restated and
amended license agreement (the "BOSS License Agreement") granting the Company
the rights to use various trademarks including the word "BOSS" in the
manufacture and domestic sale of specified types of apparel, (iv) a foreign
rights manufacturing agreement between the Company and Ambra, a concurrent use
agreement between the Company and Hugo Boss and an option on the part of Ambra
to purchase the Company's domestic BOSS trademark rights, all of which were
originally entered into in November 1997, were terminated, and (v) the Company
issued to Ambra on November 6, 1999 2.0 million shares of Preferred Stock having
an estimated fair market value of $2.0 million and agreed to issue to Ambra on
April 30, 2000 an additional 1.3 million shares of Preferred Stock having an
estimated fair market value of $1.3 million and 666,667 shares of Common Stock,
which had an aggregate value of $1.0 million based on the market price of $1.50
on the date the parties agreed to the transaction. Except with respect to the
initial term and the minimum annual royalties due Ambra by Isaacs, Isaacs'
rights under the BOSS License Agreement are substantially similar to the rights
the Company had previously had. The Preferred Stock and Common Stock issued by
the Company to Ambra are subject to a Shareholders' Agreement dated November 5,
1999 (the "Ambra Shareholders' Agreement"), which provides the Company with
certain rights of first refusal. The Ambra Shareholders' Agreement also provides
that Ambra has certain piggyback registration rights and, beginning
December 15, 2000, certain demand registration rights. The Ambra Shareholders'
Agreement further provides that, upon the occurrence of certain accelerating
acts under the BOSS License Agreement, Ambra may demand a redemption of any
Preferred Stock of the Company then held by Ambra at a redemption price equal to
one dollar ($1.00) per share.
PROPOSAL 2: RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS OF THE COMPANY
The Board of Directors, upon the recommendation of the Audit Committee, has
appointed the firm of BDO Seidman, LLP as independent auditors of the Company
for the fiscal year ending December 31, 2000. BDO Seidman, LLP has served as the
Company's independent auditors since 1985. Although not legally required to do
so, the Board is submitting the selection of BDO Seidman, LLP for ratification
by the Company's stockholders at the Meeting.
A representative of BDO Seidman, LLP will be present at the Meeting and will
have the opportunity to make a statement, if he of she desires to do so, and to
respond to appropriate questions from stockholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR RATIFICATION OF
THE APPOINTMENT OF BDO SEIDMAN, LLP AS INDEPENDENT AUDITORS OF THE COMPANY FOR
THE FISCAL YEAR ENDING DECEMBER 31, 2000.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's executive officers and directors, and persons who beneficially own
10% or more of the Company's Common Stock (the "Reporting Persons"), to file
reports regarding their Company Common Stock ownership and changes in ownership
with the SEC. Based solely on a review of the copies of such forms furnished to
the Company and written representations from certain of the Reporting Persons,
the Company believes that except as specifically set forth below, during 1999
and through the date hereof, the Reporting Persons complied with all Section
16(a) reporting requirements applicable to them:
Marc Baff inadvertently failed to timely report on Forms 4 and 5 seven
transactions during 1999, representing the purchase of an aggregate of 12,700
shares and sale of an aggregate of 1,000 shares of Common Stock of the Company.
Mr. Baff has filed a late Form 5 disclosing such purchases and sales.
14
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
IN COMPENSATION DECISIONS
None of the directors serving on the Compensation Committee is an employee
of the Company, and neither the Chief Executive Officer nor any of the Named
Executive Officers has served on the Compensation Committee. No director or
executive officer of the Company is a director or executive officer of any other
corporation that has a director or executive officer who is also a director or
board committee member of the Company.
STOCKHOLDER PROPOSALS FOR 2001 ANNUAL MEETING OF STOCKHOLDERS
The deadline for submission of stockholder proposals to be considered for
inclusion in the proxy statement and form of proxy relating to the 2001 Annual
Meeting of Stockholders is December 30, 2000. Any such proposal received by the
Corporation's principal executive offices after such date will be considered
untimely and may be excluded from the proxy statement and form of proxy.
The deadline for submission of stockholder proposals to be presented at the
2001 Annual Meeting of Stockholders, but which will not be included in the proxy
statement and form of proxy relating to such meeting, is March 14, 2001. Any
such proposal received by the Corporation's principal executive offices after
such date will be considered untimely and the persons named in the proxy for
such meeting may exercise their discretionary voting power with respect to such
proposal.
15
<PAGE>
OTHER MATTERS
The Board of Directors of the Company does not know of any matters other
than those described in this Proxy Statement that will be presented for action
at the Meeting. If any other matters are properly brought before the Meeting,
the persons named in the accompanying proxies will vote the shares represented
by such proxies on such matters as instructed by the Board of Directors of the
Company, who have instructed the proxies to vote in accordance with the proxies'
own best judgment in the absence of express instruction from the Board.
By Order of the Board of Directors
Robert J. Arnot
Chairman of the Board, Chief Executive
Officer and President
Eugene C. Wielepski
Vice President--Finance, Chief
Financial Officer and Corporate
Secretary
Baltimore, Maryland
April 28, 2000
16
<PAGE>
I.C. ISAACS & COMPANY, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 8, 2000
The undersigned hereby constitutes and appoints Robert J. Arnot and
Eugene C. Wielepski, as attorneys and proxies, with full power of substitution,
to attend and vote all of the shares which the undersigned is entitled to
vote at the Annual Meeting of Stockholders of I.C. Isaacs & Company, Inc.
(the "Company") to be held at the Best Western and Conference Center, 5625
O'Donnell Street, Baltimore, Maryland 21224, at 11:00 a.m., local time, on
Thursday, June 8, 2000 and at any adjournments or postponements thereof, with
the same force and effect as if the undersigned were personally present and
the undersigned herby instructs said attorneys and proxies to vote as follows
with respect to the matters described in the Proxy Statement.
(PLEASE SIGN ON REVERSE SIDE)
<PAGE>
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED
PLEASE MARK YOUR
A /X/ VOTES AS IN THIS
EXAMPLE.
<TABLE>
<CAPTION>
WITHHOLD
FOR all AUTHORITY
nominees to vote for all
listed at right nominees listed at right
<S> <C> <C> <C>
1. To elect three Class The following persons have been nominated to
III directors to the serve as Class III directors.
Company's Board of
Directors each for a / / / / NOMINEES: Ronald S. Schmidt
term of three years or until their successors have been Neal J. Fox
elected and qualified: Anthony J. Marterie
INSTRUCTIONS: To withhold authority to vote for any one or
more individual nominees, write the name of each such
nominee on the line provided below:
___________________________________________________________
FOR AGAINST ABSTAIN
2. To ratify the appointment of BDO Seidman LLP
as the Company's independent auditors for the / / / / / /
current fiscal year.
3. To transact such other business as may properly come before the meeting or
any adjournments or postponements thereof.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY, WHICH RECOMMENDS
A VOTE FOR THE DIRECTOR NOMINEES LISTED IN ITEM 1 AND FOR ITEM 2. AS TO ANY OTHER MATTER
WHICH MAY PROPERLY COME BEFORE THE MEETING, SAID PROXIES WILL VOTE IN ACCORDANCE WITH THEIR
BEST JUDGMENT.
THIS PROXY, WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED FOR THE DIRECTOR NOMINEES LISTED IN ITEM 1
AND FOR ITEM 2.
PLEASE INDICATE BY CHECK MARK IF YOU PLAN TO ATTEND THE ANNUAL MEETING OF STOCKHOLDERS. / /
PLEASE SIGN CARD AND RETURN THIS PROXY IN THE ENCLOSED ENVELOPE.
SIGNATURE(S) _______________________________ DATE ____________ SIGNATURE(S) _______________________________ DATE ____________
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME OR NAMES APPEARS ON THIS CARD. JOINT OWNERS SHOULD EACH SIGN PERSONALLY. WHEN SIGNING AS
ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE, OR GUARDIAN, PLEASE GIVE FULL TITLES AS SUCH. IF THE SIGNER IS A CORPORATION, THE
FULL CORPORATE NAME SHOULD BE SIGNED BY A DULY AUTHORIZED OFFICER.
</TABLE>
