<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (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 Rule 14a-11(c) or Rule 14a-12
EVANS, 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/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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:
- --------------------------------------------------------------------------------
(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:
- --------------------------------------------------------------------------------
<PAGE> 2
[EVANS LOGO]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JULY 30, 1996
To the Stockholders:
The 1996 Annual Meeting of Stockholders of Evans, Inc. will be held at the
Marriott Suites Downers Grove, 1500 Opus Place, Downers Grove, Illinois, on
Tuesday, July 30, 1996, at 10:30 a.m., Central Daylight Time, for the following
purposes:
1. To elect three Class II directors to serve until the 1999 Annual Meeting
of Stockholders and one Class III director to serve until the 1997
Annual Meeting of Stockholders.
2. To ratify the selection of Coopers & Lybrand LLP as the independent
auditors for the Company for the fiscal year ending March 1, 1997.
3. To consider and transact such other matters as may properly come before
the meeting or any adjournments thereof.
Only stockholders of record at the close of business on June 6, 1996 are
entitled to notice of and to vote at the meeting or any adjournments thereof. A
list of such stockholders will be kept at the office of the Secretary at 36
South State Street, Chicago, Illinois, during the ten days prior to the meeting.
By Order of the Board of Directors,
SAMUEL B. GARBER
Vice President,
General Counsel and Secretary
Chicago, Illinois
June 21, 1996
YOUR VOTE IS IMPORTANT
YOU ARE URGED TO COMPLETE, SIGN AND DATE AND PROMPTLY RETURN YOUR PROXY CARD IN
THE ENCLOSED SELF-ADDRESSED POSTAGE POSTPAID ENVELOPE REGARDLESS OF WHETHER YOU
PLAN TO ATTEND THE MEETING.
<PAGE> 3
[EVANS LOGO]
36 SOUTH STATE STREET
CHICAGO, ILLINOIS 60603
PROXY STATEMENT
FOR
1996 ANNUAL MEETING OF STOCKHOLDERS
JULY 30, 1996
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Evans, Inc. (the "Company") of proxies for use at the
Annual Meeting of Stockholders of the Company to be held at the Marriott Suites
Downers Grove, 1500 Opus Place, Downers Grove, Illinois, on Tuesday, July 30,
1996 at 10:30 a.m. Central Daylight Time for the purposes set forth in the
Notice of Annual Meeting of Stockholders. The approximate mailing date of this
material is June 21, 1996.
Shares represented by valid proxies in the form enclosed which are received
prior to the Annual Meeting will be voted in accordance with the directions
contained therein. Any proxy returned without specification as to any matter
will be voted in accordance with the recommendation of the Board of Directors. A
stockholder who attends the Meeting may vote in person rather than by proxy if
he so desires. A stockholder may revoke his proxy at any time before it is
exercised.
VOTING SECURITIES
The close of business on June 6, 1996, has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
Annual Meeting. On such date, the Company had outstanding 4,918,301 shares of
Common Stock (not including 1,415,134 shares held in its treasury), each of
which is entitled to one vote on all matters voted upon at the Annual Meeting.
Under Section 216 of the Delaware General Corporation Law and the Company's
By-laws, a majority of the shares of the Company's Common Stock, present in
person or represented by proxy, shall constitute a quorum for purposes of the
Meeting. In all matters other than the election of directors, the affirmative
vote of the majority of shares present in person or represented by proxy at the
Meeting and entitled to vote on the subject matter shall be the act of the
shareholders. Directors shall be elected by a plurality of the votes present in
person or represented by proxy at the Meeting and entitled to vote on the
election of directors. Abstentions are treated as votes against a proposal and
broker non-votes have no effect on the vote. Abstentions and broker non-votes
are counted for purposes of determining a quorum.
2
<PAGE> 4
PRINCIPAL STOCKHOLDERS
The following table sets forth the Common Stock of the Company owned as of
June 6, 1996, by persons who were known by the Company to own beneficially more
than 5% of the Company's outstanding Common Stock.
<TABLE>
<CAPTION>
Amount of
Name and Address Beneficial
of Beneficial Owner Ownership Percent
- ---------------------------------------------------------------------- --------- -------
<S> <C> <C>
D. B. Meltzer......................................................... 1,061,720(1) 21.6
36 South State Street
Chicago, IL 60603
Peter Cundill & Associates (Bermuda), Ltd. ........................... 1,342,854(2) 27.3
Clarendon House
Church Street
Hamilton, Bermuda
Dimensional Fund Advisors, Ltd. ...................................... 343,400 (3) 7.0
1299 Ocean Avenue
Santa Monica, CA 90401
</TABLE>
- ------------
(1) Including (a) 160,200 shares held in trust for benefit of Mr. Meltzer, with
the trustee and Mr. Meltzer having shared voting and investment power and
(b) includes an option to acquire 40,000 shares.
(2) As reported in Schedule 13D filed by said firm on September 12, 1995 with
the Securities and Exchange Commission which report reflects sole voting
power as to 227,000 shares, shared voting power as to 885,354 shares, sole
dispositive power as to 477,354 shares and shared dispositive power as to
865,500 shares.
(3) As reported in Schedule 13G dated February 7, 1996, filed by said firm with
the Securities and Exchange Commission which report reflects sole voting
power as to 216,700 shares, shared voting power as to 126,700 shares and
sole dispositive power as to all shares.
1. ELECTION OF DIRECTORS
The Board of Directors passed a resolution effective May 22, 1996 modifying
the Company's By-laws to provide that the Board of Directors shall consist of
eight directors. The Company's Restated Certificate of Incorporation provides
for the classification of the Board of Directors into three classes, as nearly
equal in number as possible, with the term of office of one class expiring each
year. Unless otherwise instructed, the enclosed proxy will be voted to elect
Dennis S. Bookshester, Patrick J. Regan and Edmond D. Cicala as Class II
directors for a term of three years expiring at the 1999 Annual Meeting of
Stockholders and Gwendolyn L. Stanback as a Class III director for a term
expiring at the 1997 Annual Meeting of Stockholders, and until their respective
successors are duly elected and qualified. If any of the nominees should become
unavailable, such proxy will be voted for a substitute nominee or nominees
proposed by the Board of Directors. Management does not anticipate that any
nominee will become unavailable.
3
<PAGE> 5
The following table provides information concerning each Director and
nominee for election as a Director, and except as otherwise indicated, the
persons named in the table have sole voting and investment power with respect to
the shares of Common Stock shown as beneficially owned by them.
<TABLE>
<CAPTION>
Amount and
Nature of
Year Beneficial Percentage
First Ownership of
Name and Became as of Outstanding
Principal Occupation(1) Age Director June 6, 1996 Common Stock
- --------------------------------------------------- --- -------- ------------ ------------
<S> <C> <C> <C> <C>
CLASS II
NOMINEES TO SERVE UNTIL THE 1999 ANNUAL MEETING OF
STOCKHOLDERS (CLASS II)
Dennis S. Bookshester.............................. 57 1991 11,000(2) .2
Independent business consultant; Director,
American Gem Corp., AMRE, Inc., Fruit of the
Loom, Inc., Playboy Enterprises, Inc., Sundance
Homes, Inc.
Edmond D. Cicala(3)................................ 70 -- 1,000 --
President, Edmond Enterprises, Inc., (a retailing
consulting firm); Director, National Commerce
Bancorp., Proffitt's Inc.
Patrick J. Regan................................... 46 1995 103,500(4) 2.1
President and Chief Executive Officer
CLASS III
NOMINEE TO SERVE UNTIL THE 1997 ANNUAL MEETING OF
STOCKHOLDERS (CLASS III)
Gwendolyn L. Stanback.............................. 40 1995 10,000(2) .2
Associate Director, Bear, Stearns & Co. Inc.
(an investment banking firm)
CLASS III
CONTINUING DIRECTORS HAVING A TERM OF OFFICE
EXPIRING AT THE 1997 ANNUAL MEETING OF STOCKHOLDERS
(CLASS III)
D. B. Meltzer...................................... 67 1960 1,061,720(2)(5) 21.6
Chairman of the Board and Chief Executive Officer
Harold Sussman..................................... 86 1963 136,306(2)(7) 2.7
Retired Executive Vice President of the
Company(6)
CLASS I
CONTINUING DIRECTORS HAVING TERMS OF OFFICE
EXPIRING
AT THE 1998 ANNUAL MEETING OF STOCKHOLDERS (CLASS
I)
Robert K. Meltzer.................................. 42 1981 238,144(8) 3.8
Executive Vice President and General Merchandise
Manager
Ernest R. Wish..................................... 65 1994 15,000(2) .3
Director of Revenue, City of Chicago
All officers and directors as a group (10
persons)......................................... -- -- 1,879,670 38.2
</TABLE>
- ------------
(1) Each director has been an officer of the Company, or has been principally
employed in the capacity stated, for the past five years, with the
exception of Ernest R. Wish and Gwendolyn L. Stanback. Mr. Wish was a
partner of Coopers & Lybrand from 1965 to 1992, a business consultant from
1992 to 1993, City Clerk, City of Chicago, September, 1993 through April,
1995 and Director of Revenue, City of Chicago, since July, 1995. Ms.
Stanback was Senior Director at Continental Bank, N.A., from 1977 through
1992, Senior Capital Advisor, SEI Corporation 1992 to 1994, and since May,
1994, Associate Director, Bear, Stearns & Co. Inc.
4
<PAGE> 6
(2) Includes an option to acquire 10,000 shares.
(3) Mr. Cicala formerly served as a director from 1984 to 1994.
(4) Includes an option to acquire 100,000 shares.
(5) See (1) under "Principal Stockholders" above.
(6) Mr. Sussman is married to the sister of the late A. L. Meltzer, father of
D. B. Meltzer.
(7) Includes 30,006 shares held by Mr. Sussman's wife and 7,200 shares held by
trusts of which Mrs. Sussman is a co-trustee, as to which beneficial
ownership is disclaimed.
(8) Includes an option to acquire 50,000 shares and 2,000 shares held as
custodian for the benefit of Mr. Meltzer's children of which beneficial
interest is disclaimed. Robert K. Meltzer is the son of D. B. Meltzer.
5
<PAGE> 7
INFORMATION ABOUT THE BOARD OF DIRECTORS AND
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors maintains an Audit Committee and a Compensation
Committee. The Company does not have a standing executive or nominating
committee or any committee performing similar functions.
The members of the Audit Committee are Messrs. Sussman (Chairman),
Bookshester and Wish. The Audit Committee's primary function is to assist in
fulfilling the Board's functions relating to the Company's financial statements,
the scope of the audit, any comments made by the independent public accountants
upon the financial condition of the Company and its accounting controls and
procedures, and such other matters as the Committee deems appropriate. The
Committee held two meetings during the last fiscal year.
The Compensation Committee is comprised solely of directors who are not
employees of the Company. The Compensation Committee held two meetings during
the last fiscal year. The function of the Committee is to make recommendations
to the Board of Directors with respect to the compensation of executive officers
of the Company and the granting of stock options to selected key employees. The
members of the Compensation Committee are Messrs. Wish (Chairman), Bookshester
and Sussman.
Each director who is not an employee of the Company receives an annual fee
of $8,000. In addition, each director who is not an employee receives a meeting
fee of $1,500 for each meeting of the Board of Directors attended and $1,000 for
each committee meeting attended. Directors who are also employees of the Company
receive no remuneration for serving as directors. Each director agreed, for the
fiscal year ended March 2, 1996, to reduce all annual, board and committee
meeting fees by ten percent. Since the Company's pre-tax profits achieved the
target established by the Board of Directors, the reduction was restored.
Pursuant to the Evans, Inc. 1994 Stock Option Program, each director of the
Company, who is not otherwise an officer or employee of the Company, or its
subsidiaries or affiliates, from and after May 9, 1994, shall be granted a
nonstatutory option to purchase 10,000 shares of Common Stock, having an
exercise price per share equal to the fair market value of the shares on May 10,
1994. Any person who initially becomes a director after May 9, 1994 and who is
not otherwise an officer or employee of the Company, or its subsidiaries or
affiliates, shall automatically be awarded a grant of nonstatutory options to
purchase 10,000 shares of Common Stock, having an exercise price per share equal
to the fair market value of the shares as of the date such person becomes a
director. All such options expire ten years after the date of grant and are
immediately exercisable.
The Board of Directors met eight times during the fiscal year ended March
2, 1996. Each director attended all meetings of the Board of Directors and of
the Committees of the Board on which he or she served.
SECTION 16(A) COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's officers, directors and greater than 10% stockholders to file certain
reports with respect to beneficial ownership of the Company's equity securities.
Based on information provided to the Company by each director and executive
officer, the Company believes all reports to be filed in fiscal 1996 were timely
filed.
6
<PAGE> 8
COMPENSATION OF EXECUTIVE OFFICERS
SUMMARY COMPENSATION TABLE
The following table discloses compensation received by the Company's Chief
Executive Officer and the four next most highly paid executive officers for the
three fiscal years ended March 2, 1996.
<TABLE>
<CAPTION>
Long-Term
Compensation
------------
Awards
------------
Annual Compensation(1) Securities
Name and ----------------------------- Underlying All Other
Principal Position Year Salary Bonus Options(#) Compensation(2)
- ------------------------------ ---- -------- ------- ------------ ---------------
<S> <C> <C> <C> <C> <C>
David B. Meltzer(3) 1996 $176,472 -- 40,000 $ 4,032
Chairman of the Board 1995 245,000 -- 0 4,032
1994 245,000 -- 0 2,246
Patrick J. Regan(4) 1996 175,000 -- 100,000(5) 557
President and 1995 175,000 -- 0 557
Chief Executive Officer 1994 175,000 -- 0 326
Robert K. Meltzer 1996 175,000 -- 50,000(5) 326
Executive Vice President 1995 175,000 -- 0 326
and General Merchandise 1994 175,000 -- 0 326
Manager
Samuel B. Garber 1996 110,000 -- 75,000(5) 2,246
Vice President, Secretary 1995 110,000 -- 0 2,246
and General Counsel 1994 110,000 -- 0 2,246
John A. Sarama 1996 125,000 -- 20,000 326
Vice President Operations 1995 122,500 -- 0 326
1994 112,000 -- 0 326
</TABLE>
- ------------
(1) The dollar value of perquisites and other personal benefits for each of the
named officers was less than the established reporting thresholds.
(2) "All Other Compensation" only includes the dollar value of insurance
premiums paid with respect to term life insurance.
(3) Mr. David B. Meltzer served as Chief Executive Officer, until June 30, 1995.
(4) Mr. Patrick J. Regan, Executive Vice President and Chief Operating Officer
since April 3, 1991, was elected President and Chief Executive Officer
effective July 1, 1995.
(5) In December 1995, options previously granted to Messrs. Regan, Meltzer and
Garber covering 100,000, 50,000 and 75,000 shares, respectively, were
cancelled and surrendered and replacement options covering such shares were
granted pursuant to the 1994 Stock Option Program. See "Option Repricings"
below.
7
<PAGE> 9
Set forth in the following table is information concerning unexercised
options held by the named executive officers at the end of the fiscal year ended
March 2, 1996. No named executive officer exercised any stock options during
fiscal year 1996.
<TABLE>
<CAPTION>
Number of Securities Total Value of Unexercised
Underlying Unexercised Options In-The-Money Options
at March 2, 1996(#) held at March 2, 1996
--------------------------------- ---------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
David B. Meltzer 40,000 -0- $-0- $-0-
Patrick J. Regan 100,000 -0- -0- -0-
Robert K. Meltzer 50,000 -0- -0- -0-
Samuel B. Garber 75,000 -0- -0- -0-
John A. Sarama 20,000 -0- -0- -0-
</TABLE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During 1996, the Compensation Committee of the Board of Directors included
Mr. Harold Sussman, who was formerly an officer of the Company.
OPTION REPRICINGS
On December 4, 1995, the Compensation Committee awarded stock options to
certain officers and key employees of the Company at a price of $1.50 per share.
The closing market price on date of grant was $1.25. In view of the
extraordinary efforts of Messrs. Patrick Regan, Robert K. Meltzer and Samuel B.
Garber in connection with the Company's performance, the Committee determined it
to be in the best interests of the Company and its stockholders to cancel and
replace the stock options held by each of Messrs. Regan, Meltzer and Garber to
purchase 100,000, 50,000 and 75,000 shares of Common Stock (the "Initial
Options"), respectively with stock options covering the same number of shares
(the "Replacement Options"). The Initial Options were granted on September 4,
1990, for a term of ten years at a price of $1.65 being the market price on the
date of the grant. The Replacement Options have an exercise price of $1.50 and
expire ten years from the date of grant.
Respectfully submitted by the Compensation Committee
Ernest R. Wish, Chairman
Dennis S. Bookshester
Harold Sussman
TEN YEAR OPTION REPRICINGS
<TABLE>
<CAPTION>
Length of
Market Price Exercise Original
Number of of Price Option
Options Stock at at Term Remaining
Repriced Time of Time of New at Date of
or Repricing or Repricing or Exercise Repricing or
Date Amended(#) Amendment($) Amendment($) Price($) Amendment
------- ---------- ------------ ------------ -------- --------------
<S> <C> <C> <C> <C> <C> <C>
Patrick J. Regan 12/4/95 100,000 $ 1.25 $ 1.65 $ 1.50 4.75 years
Robert K. Meltzer 12/4/95 50,000 $ 1.25 $ 1.65 $ 1.50 4.75 years
Samuel B. Garber 12/4/95 75,000 $ 1.25 $ 1.65 $ 1.50 4.75 years
</TABLE>
8
<PAGE> 10
OPTION GRANTS
The following table sets forth information on grants of options to the
Named Officers during the fiscal year ended March 2, 1996.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential
Individual Grants(a) Realizable Value
----------------------------------------------------- at Assumed Annual
Number of % of Total Rates of Stock
Securities Options/SARs Exercise Appreciation for
Underlying Granted to or Option Term(b)
Options/SARs Employees in Base Price Expiration ------------------
Granted(#) Fiscal Year ($/Share) Date 5% 10%
------------ ------------ ---------- ---------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
David B. Meltzer 40,000 11.1 $ 1.50 12/3/05 $37,734 $ 95,625
Patrick J. Regan(c) 100,000 27.1 1.50 12/3/05 94,334 239,061
Robert K. Meltzer(c) 50,000 13.9 1.50 12/3/05 47,167 119,531
John Sarama 20,000 5.6 1.50 12/3/05 18,867 47,812
Samuel B. Garber(c) 75,000 20.8 1.50 12/3/05 70,751 179,296
</TABLE>
- ------------
(a) All options were granted under the 1994 Stock Option Program at a price
above the fair market value of a share of Common Stock on the date of grant.
(b) The dollar amounts indicated in these columns result from calculations
assuming 5% and 10% growth rates as required by the rules of the Securities
Exchange Commission and are not intended to forecast possible future
appreciation, if any, of the Company's stock price. The actual future value
of the options will depend on the market value of the Common Stock. The
Company did not use an alternative formula for a grant date valuation as it
is not aware of any formula which will determine with reasonable accuracy a
present value based on future unknown or volatile factors.
(c) On December 4, 1995, options previously granted to Messrs. Regan, Meltzer
and Garber covering 100,000, 50,000 and 75,000 respectively were cancelled
and surrendered and replacement options on such shares were granted on such
date. See "Option Repricings."
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The executive compensation program is administered by the Compensation
Committee of the Board of Directors (the Committee) which is composed of three
outside Directors, none of whom is presently an officer or employee of the
Company or any of its subsidiaries. The committee determines annual incentive
awards and long-term compensation for officers and, at least annually, makes
recommendations regarding officer salaries to the Board.
The Committee believes that corporate performance and, in turn, shareholder
value will be enhanced by a compensation system which supports and reinforces
the Company's key operating and strategic goals while aligning the financial
interests of the Company's executive officers with those of the shareholders.
The Company utilizes both short-term and long-term incentive compensation
programs to achieve this objective. These programs are tied to store, regional,
departmental and Company-wide business goals as well as individual goals. For
executive officers, the Company relies on an annual incentive program and stock
option program to align the executives' financial interests with those of its
shareholders.
The Company's compensation program for executive officers consists of a
base salary, an annual incentive bonus program and a stock option program, all
of which are tied to the Company's success in achieving financial and strategic
performance goals. The Company's performance goals are proposed by management
and are approved by the Board of Directors of the Company as part of the
Company's budgeting process.
9
<PAGE> 11
BASE SALARY
Each year, the Committee reviews proposals by the Company's Chief Executive
Officer ("CEO") for annual base salary for the executive officers other than the
CEO. In evaluating the CEO's proposals, the Committee considers (1) the
individual executive officer's performance including evaluations thereof
provided by the CEO and (2) the Company's performance in relation to its
performance goals, which includes pre-tax earnings. The base salaries for all
executive officers were unchanged in fiscal 1996, except that Mr. David B.
Meltzer's salary was reduced to $150,000 per year, effective July 1, 1995, when
he resigned as CEO.
SALARY REDUCTION AND BONUS OPPORTUNITIES
In fiscal 1996 each executive officer of the Company agreed to reduce his
annual base salary by 10%. In the event the Company's performance goals for the
fiscal 1996 year were achieved, then each executive officer would have his 10%
reduction restored retroactively for fiscal 1996 and the ensuing year. In the
event the Company's pre-tax profits did not meet budget, then the 10% reduction
would not have been restored for fiscal 1996 or the following year. The Company
did meet its budgeted pre-tax profits for fiscal 1996 and therefore the
executives' 10% reduction was restored. No cash bonuses were paid to executive
officers for fiscal years 1994, 1995 and 1996.
LONG-TERM STOCK RELATED INCENTIVES
The Company also has a long-term incentive program consisting of a stock
option program under which the Committee reviews and recommends proposed grants
of long-term incentive compensation in the form of stock options. The Committee
considers stock options to be an important means of insuring that senior
executives maintain their incentive to increase the profitability of the Company
and the value of the Company's stock. Whether a grant will be made to an
executive officer, and in what amount, is determined by the subjective
evaluation of the executive's ability to influence the Company's long-term
growth and profitability. Because the value of stock options is entirely a
function of the value of the Company's stock, the Committee believes that this
component of the Company's compensation arrangement aligns the interest of the
senior executives with those of the Company's shareholders.
CHIEF EXECUTIVE OFFICER'S COMPENSATION
The Committee determined that the compensation of Patrick J. Regan, who
assumed the position of President and Chief Executive Officer effective July 1,
1995 be continued at $175,000 per year for the balance of fiscal 1996. The
Committee evaluated the Company's performance with respect to its stated budget
and financial goals that were established prior to Mr. Regan assuming the
position of Chief Executive Officer. The Committee also evaluated Mr. Regan's
personal performance, in view of his personal goals, principally relating to
restructuring, cost reductions, organizational consolidations, increasing
revenues and the extent to which the Company achieved its financial goals. Based
on the Committee's assessment of his performance against such criteria, Mr.
Regan's salary was increased, effective for fiscal 1997, to $245,000 per year.
The Committee also considered the effect of Internal Revenue Code Section
162(m), which imposes a $1 million limit per year on the corporate tax deduction
for compensation paid or accrued with respect to the top five executives of a
publicly-held corporation. Performance-based compensation that meets certain
requirements will not be subject to this deduction limit. The Committee will
continue to monitor the impact of the Section 162(m) limit and to assess various
alternatives to minimize or eliminate any loss of tax deductions in future
years, provided the alternatives are consistent with the objectives of the
Company's executive compensation program.
Ernest R. Wish, Chairman
Dennis S. Bookshester
Harold Sussman
10
<PAGE> 12
STOCK PRICE PERFORMANCE GRAPH
The Stock Price Performance Graph set forth below compares the cumulative
total stockholder return on the Common Stock of the Company for the five-year
period beginning March 3, 1991 and ending March 2, 1996, with the cumulative
total return on the S&P 500 and a peer group index of Apparel Specialty Chains
over the same period (assuming the investment of $100 in the Company's Common
Stock, the S&P 500 and a peer group index on March 3, 1991, reinvestment of all
cash dividends and equalization of stock splits and dividends).
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
AMONG EVANS, INC., THE S&P 500 INDEX, AND A PEER GROUP
<TABLE>
<CAPTION>
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) EVANS, INC. PEER GROUP S & P 500
<S> <C> <C> <C>
2/91 100 100 100
2/92 93 115 116
2/93 186 107 128
2/94 214 82 139
2/95 93 89 149
2/96 79 48 201
</TABLE>
<TABLE>
<CAPTION>
Cumulative Total Return
--------------------------------------------
2/91 2/92 2/93 2/94 2/95 2/96
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Evans, Inc....................................... 100 93 186 214 93 79
Peer Group....................................... 100 115 107 82 89 48
S&P 500.......................................... 100 116 128 139 149 201
</TABLE>
The Company's peer group is comprised of five other apparel specialty
chains: Ann Taylor Stores Corporation, Cache Inc., Deb Shops Inc., Fredericks of
Hollywood Inc., and Gantos Inc.
2. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors has appointed Coopers & Lybrand LLP, who has served
as the Company's independent auditors since 1962, to audit the financial
statements of the Company for the fiscal year ending March 1, 1997 and proposes
that stockholders approve such appointment. The Company expects a representative
of Coopers & Lybrand LLP to be present at the Annual Meeting with the
opportunity to make a statement if he so desires and to be available to respond
to appropriate questions. The affirmative vote of the holders of a majority of
the shares represented in person or by proxy at the meeting is required to
ratify the selection of Coopers & Lybrand LLP.
11
<PAGE> 13
PROPOSALS OF STOCKHOLDERS FOR 1997 ANNUAL MEETING
Stockholder proposals may be submitted for inclusion in EVANS 1997 proxy
material after the 1996 Annual Meeting but no later than 5 p.m. CST on, February
21, 1997. Proposals must be in writing and sent via registered, certified or
express mail to: Office of the Secretary, Evans, Inc., 36 South State Street,
Chicago, IL 60603. Facsimile or other forms of electronic submissions will not
be accepted.
FINANCIAL STATEMENTS
The Annual Report of the Company for the fiscal year ended March 2, 1996,
is enclosed herewith but does not constitute a part of the proxy soliciting
material.
OTHER MATTERS
Management knows of no other matters which may be brought before the Annual
Meeting. However, if any other matter is presented to the Meeting on which a
vote properly may be taken, the persons named in the enclosed proxy will vote
thereon in accordance with their best judgment.
The enclosed proxy is solicited by the Board of Directors of the Company.
The cost of solicitation will be borne by the Company. In addition to the
solicitation of proxies by mail, directors, officers or employees of the Company
may solicit proxies personally or by telephone or telegraph, and the Company may
request persons holding stock in their names or names of their nominees to
obtain proxies from and send proxy material to their principals and will
reimburse such persons for their expenses in doing so.
To help assure a quorum at the Annual Meeting, please sign and mail the
enclosed proxy promptly in the envelope provided. The signing of the proxy will
not prevent your attending the Meeting and voting in person, should you desire.
All stockholders are cordially invited to attend the Meeting.
By Order of the Board of Directors
SAMUEL B. GARBER
Vice President,
General Counsel and Secretary
Chicago, Illinois
June 21, 1996
12
<PAGE> 14
EVANS, INC.
PROXY FOR 1996 ANNUAL MEETING OF STOCKHOLDERS
The undersigned hereby appoints D.B. Meltzer and Harold Sussman, each
with the power to appoint his substitute, and hereby authorizes them to
represent and to vote, as designated below, all the shares of common stock of
EVANS, INC., held of record by the undersigned on June 6, 1996, at the Annual
Meeting of Stockholders of Evans, Inc. scheduled to be held at the Marriott
Suites Downers Grove, 1500 Opus Place, Downers Grove, Illinois, on Tuesday,
July 30, 1996, at 10:30 a.m., Central Daylight Time, and at any adjournment
thereof:
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this proxy
will be voted for proposals 1 and 2.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY
(CONTINUED, AND TO BE DATED AND SIGNED, OVER)
EVANS, INC.
PLEASE MARK IN OVAL IN THE FOLLOWING MANNER USING DARK INK ONLY. / /
<TABLE>
<CAPTION>
<S> <C>
[ THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 1 AND 2. ]
1. ELECTION OF THREE CLASS II DIRECTORS, for the term For All
expiring at the 1999 Annual Meeting of Stockholders and For Withheld Except
ONE CLASS III DIRECTOR for the term expiring at the 1997 / / / / / /
Annual Meeting of Stockholders.
Nominees: Dennis S. Bookshester, Edmond D. Cicala,
Patrick J. Regan and Gwendolyn L. Stanback
INSTRUCTION: To withhold your vote for any individual
nominee, write that nominee's name on the space provided
below.
-------------------------------------------------------------
2. APPROVE THE SELECTION OF COOPERS & LYBRAND LLP as the independent For Against Abstain
auditors for the Company for the fiscal year ending March 1, 1997. / / / / / /
Dated_____________________________,1996
________________________________________
________________________________________
(Please sign your name exactly as
shown to the left. Joint owners
should each sign, Executors,
administrators, trustees, etc.,
should so indicate when signing.)
PLEASE MARK SIGN, DATE AND
RETURN THE PROXY IN THE
ENCLOSED ENVELOPE.
</TABLE>
