<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
FABRI-CENTERS
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FABRI-CENTERS
(NAME OF PERSON(S) FILING PROXY STATEMENT)
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(j)(2).
/ / $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:
(4) Proposed maximum aggregate value of transaction:
/ / 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:
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<PAGE> 2
INSERT FABRI-CENTERS LOGO
5555 Darrow Road
Hudson, Ohio 44236
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 27, 1994
The Annual Meeting of Shareholders of Fabri-Centers of America, Inc. will
be held at Fabri-Centers Corporate Office, 5555 Darrow Road, Hudson, Ohio, on
June 27, 1994, at 1:00 p.m., local time, for the following purposes:
1. To elect three Directors of the class whose three-year terms of
office will expire in 1997;
2. To consider and act upon a proposal to approve amendments to the
Company's 1990 Employees Stock Option and Stock Appreciation Rights Plan
including an increase by 750,000 in the number of shares with respect to
which options may be granted thereunder;
3. To consider and act upon a proposal to approve the adoption of the
Company's 1994 Executive Incentive Plan; and
4. To transact such other business as may properly come before the
meeting.
The Board of Directors has fixed the close of business on May 17, 1994, as
the record date for determining shareholders who are entitled to notice of the
meeting and to vote.
YOUR VOTE IS IMPORTANT. PLEASE COMPLETE, SIGN, AND RETURN THE ENCLOSED
PROXY IN THE RETURN ENVELOPE PROVIDED FOR THAT PURPOSE, WHETHER OR NOT YOU
EXPECT TO BE PRESENT AT THE MEETING. IF YOU ATTEND THE MEETING, YOU MAY REVOKE
YOUR PROXY AND VOTE YOUR COMMON SHARES IN PERSON.
The Proxy Statement accompanies this Notice.
BETTY ROSSKAMM, Secretary
May 27, 1994
By Order of the
Board of Directors
<PAGE> 3
INSERT FABRI-CENTERS LOGO
5555 Darrow Road
Hudson, Ohio 44236
1994 ANNUAL MEETING
JUNE 27, 1994
THE PROXY AND This Proxy Statement is being mailed on May 27, 1994, to the
SOLICITATION shareholders of Fabri-Centers of America, Inc.
(the "Company") in connection with the solicitation by the
Board of Directors of the enclosed form of
Proxy for the 1994 Annual Meeting of Shareholders to be held on June
27, 1994. Pursuant to the Ohio General Corporation Law, any shareholder signing
and returning the enclosed Proxy has the power to revoke it by giving notice of
such revocation to the Company in writing or in the open meeting before any
vote with respect to the matters set forth therein is taken. The representation
in person or by Proxy of at least a majority of the outstanding Common Shares
entitled to vote is necessary to provide a quorum at the Annual Meeting. The
nominees for Directors receiving the greatest number of votes will be elected.
As a result, although abstentions and broker non-votes will not be counted in
determining the outcome of the vote, they will be counted in determining
whether a quorum has been achieved. The cost of soliciting the Proxy will be
borne by the Company.
PURPOSES OF The Annual Meeting has been called for the purposes of (1)
ANNUAL MEETING electing three Directors of the class whose three-year terms
of office will expire in 1997; (2) considering and acting
upon a proposal to approve amendments to the Company's 1990 Employees
Stock Option and Stock Appreciation Rights Plan including an increase by
750,000 in the number of shares with respect to which options may be granted
thereunder; (3) considering and acting upon a proposal to approve the adoption
of the Company's 1994 Executive Incentive Plan; and (4) transacting such other
business as may properly come before the meeting.
The three persons named in the enclosed Proxy have been selected by the
Board of Directors and will vote Common Shares represented by valid Board of
Directors' Proxies. They have indicated that, unless otherwise indicated in the
enclosed Proxy, they intend to vote for the election of the nominees listed
below and in favor of the proposals listed in Items 2 and 3 above.
The Company has no knowledge of any other matters to be presented at the
meeting, except the reports of officers on which no action is proposed to be
taken. In the event that other matters do properly come before the meeting, the
persons named in the Proxy will vote in accordance with their judgment on such
matters.
VOTING The Board of Directors has fixed the close of business on May
SECURITIES 17, 1994, as the record date for determining shareholders
entitled to notice of the meeting and to vote. On that date,
9,126,066 Common Shares were outstanding and entitled to one
vote on all matters properly brought before the Annual Meeting. Under
the Ohio General Corporation Law, all of the Common Shares may be voted
cumulatively in the election of Directors if any shareholder gives written
notice to the President, a Vice President or the Secretary of the Company, not
less than 48 hours before the time set for the meeting, and an announcement of
the notice is made at the beginning of the meeting by the Chairman or the
Secretary or by or on behalf of the shareholder giving such notice. Cumulative
voting permits a shareholder to (1) cast a number of votes equal to the number
of Common Shares owned by the shareholder multiplied by the number of Directors
to be elected and (2) cast those votes for only one nominee or distribute them
among the nominees. In the event that voting at the election is cumulative, the
persons named in the enclosed Proxy will vote the Common Shares represented by
valid Proxies on a cumulative basis for the election of the nominees listed
below, allocating the votes of such Common Shares in accordance with their
judgment.
1
<PAGE> 4
SECURITY The following table sets forth, as of March 31, 1994, the
OWNERSHIP OF amount of the Company's Common Shares beneficially owned
MANAGEMENT by each of its Directors and nominees for Directors, the
Chief Executive Officer, the four other most highly
compensated executive officers, and all executive officers and
Directors of the Company as a group. Unless otherwise indicated, each of the
persons listed in the following table has sole voting and investment power
with respect to the Common Shares set forth opposite his or her name:
<TABLE>
<CAPTION>
NUMBER OF
COMMON SHARES
NAME OF BENEFICIALLY PERCENT OF CLASS
BENEFICIAL OWNER OWNED IF 1% OR MORE
- ---------------------------------------- ---------------- ----------------
<S> <C> <C>
Betty Rosskamm.......................... 700,402(1)(2) 7.68%
Alan Rosskamm........................... 590,446(1)(3) 6.39%(3)
Alma Zimmerman.......................... 560,287(1) 6.14%
Martin Rosskamm......................... 179,962(1) 1.97%
Justin Zimmerman........................ 140,434(1) 1.54%
Robert Norton........................... 90,496(1)(4) --
Jane Aggers............................. 72,516(1)(5) --
John Stec............................... 25,541(1)(6) --
Fred Johnson............................ 27,293(1)(7) --
Samuel Krasney.......................... 17,250(8) --
Scott Cowen............................. 12,300(9) --
Ira Gumberg............................. 13,500(10) --
Frank Newman............................ 7,500(10) --
All executive officers and
Directors as a group
(13 persons).......................... 2,437,929(1)(11) 26.06%(11)
</TABLE>
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(1) With respect to Common Shares beneficially owned by such persons under the
Company's Employees' Savings and Profit Sharing Plan, the Common Shares
included are as of December 31, 1993, the latest date for which statements
are available.
(2) Includes 14,400 Common Shares held by Mrs. Rosskamm as custodian for the
benefit of her grandchildren.
(3) Includes 110,750 Common Shares subject to stock options granted to Mr.
Rosskamm exercisable on or prior to May 30, 1994, 75,000 Common Shares held
as restricted stock under the Company's Executive Incentive Plan, and an
aggregate of 211,088 Common Shares held by his children, spouse, or by Mr.
Rosskamm as trustee for the benefit of family members and charities.
(4) Includes 12,500 Common Shares subject to stock options granted to Mr.
Norton exercisable on or prior to May 30, 1994, 64,500 Common Shares held
as restricted stock under the Company's Executive Incentive Plan, and an
aggregate of 2,250 Common Shares owned by Mr. Norton in a fiduciary
capacity for the benefit of his children and his wife.
(5) Includes 40,125 Common Shares subject to stock options granted to Ms.
Aggers exercisable on or prior to May 30, 1994 and 14,750 Common Shares
held as restricted stock under the Company's Executive Incentive Plan.
(6) Includes 12,375 Common Shares subject to stock options granted to Mr. Stec
exercisable on or prior to May 30, 1994 and 12,000 Common Shares held as
restricted stock under the Company's Executive Incentive Plan.
(7) Includes 16,250 Common Shares subject to stock options granted to Mr.
Johnson exercisable on or prior to May 30, 1994, 6,500 Common Shares held
as restricted stock under the Company's Executive Incentive Plan, and an
aggregate of 1,000 Common Shares owned by Mr. Johnson in a fiduciary
capacity for the benefit of his children.
2
<PAGE> 5
(8) Includes 15,000 Common Shares subject to stock options granted to Mr.
Krasney under the 1988 Stock Option Plan for Non-Employee Directors
exercisable on or prior to May 30, 1994.
(9) Includes 10,000 Common Shares subject to stock options granted to Mr. Cowen
under the 1988 Stock Option Plan for Non-Employee Directors exercisable on
or prior to May 30, 1994.
(10) Includes 7,500 Common Shares subject to stock options granted to each of
Mr. Gumberg and Mr. Newman under the 1988 Stock Option Plan for
Non-Employee Directors exercisable on or prior to May 30, 1994.
(11) Includes 232,000 Common Shares subject to stock options granted under the
Company's Stock Option Plans and exercisable on or prior to May 30, 1994
and 172,750 Common Shares of restricted stock awarded under the Company's
Executive Incentive Plan.
SECURITY The following table and notes thereto set forth information
OWNERSHIP OF as to the only persons or groups known to the Company to be
CERTAIN BENEFICIAL beneficial owners (as defined by the Securities and
OWNERS Exchange Commission) of more than five percent of the
outstanding Common Shares of the Company as of March 31,
1994. Unless otherwise indicated, each of the owners listed in the
following table has sole voting and investment power with respect to the Common
Shares set forth opposite their names:
<TABLE>
<CAPTION>
NUMBER OF
NAME AND ADDRESS COMMON SHARES PERCENT
OF BENEFICIAL OWNERS BENEFICIALLY OWNED OF CLASS
-------------------- ------------------ --------
<S> <C> <C>
Mr. and Mrs. Martin Rosskamm............................. 880,364(1)(2) 9.65%
5555 Darrow Road, Hudson, OH 44236
FMR Corporation.......................................... 850,207(3) 9.32%
82 Devonshire Street, Boston, MA 02109
Mr. and Mrs. Justin Zimmerman............................ 700,721(1) 7.68%
5555 Darrow Road, Hudson, OH 44236
First Pacific Advisors, Inc.............................. 675,841(3) 7.41%
11400 West Olympic Boulevard, Ste 1200,
Los Angeles, CA 90064
Mr. Alan Rosskamm........................................ 590,446(1)(4) 6.39%(4)
5555 Darrow Road, Hudson, OH 44236
The State Teachers Retirement Board of Ohio (STRS)....... 553,900(3) 6.07%
275 East Broad Street, Columbus, OH 43215
</TABLE>
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(1) With respect to Common Shares beneficially owned by such persons under the
Company's Employees' Savings and Profit Sharing Plan, the Common Shares
included are as of December 31, 1993, the latest date for which statements
are available.
(2) Includes 14,400 Common Shares held by Mrs. Rosskamm as custodian for the
benefit of her grandchildren.
(3) The Common Shares listed are reported on a Form 13G filed with the SEC with
respect to holdings as of December 31, 1993.
(4) Includes 110,750 Common Shares subject to stock options granted to Mr.
Rosskamm exercisable on or prior to May 30, 1994, 75,000 Common Shares held
as restricted stock under the Company's Executive Incentive Plan, and an
aggregate of 211,088 Common Shares held by his children, spouse, or by Mr.
Rosskamm as trustee for the benefit of family members and charities.
ELECTION OF The Board of Directors of the Company presently consists of
DIRECTORS ten members divided into three classes, two classes consisting
of three members and one class consisting of four members. The
class whose term expires in 1994 includes Martin Rosskamm and Justin
Zimmerman. Both of these Directors will retire at the Annual Meeting and assume
the titles of Founder. They each have been directors since 1951.
3
<PAGE> 6
Accordingly, the Board of Directors will be reduced to nine members
consisting of three classes of three directors each. To accomplish this,
effective with the election to be held at this Annual Meeting, the Board of
Directors has fixed the number of Directors at three in the class whose
three-year term of office will expire in 1996. Scott Cowen, Alan Rosskamm, and
Ira Gumberg are the nominees to be elected at this Annual Meeting for terms of
three years expiring in 1997. Effective with his election to the class of 1997,
Mr. Cowen will resign as a Director of the class whose term expires in 1996,
and Mr. Alan Rosskamm will resign as a member of the class whose term expires
in 1995. Since insufficient time exists to identify a suitable replacement
nominee there will remain one vacancy in the class of 1995. It is anticipated
that the vacancy may be filled at a later date by the Board of Directors,
although there are currently no nominees under consideration. The proxies
solicited hereby will not be voted for a greater number of persons than the
number of nominees named herein.
In the event of the death of or inability to act of any of the nominees,
the Proxies will be voted for the election as a Director of such other person as
the Board of Directors may recommend. The Board of Directors has no reason,
however, to anticipate that this will occur.
NOMINEES TO The following table sets forth certain information regarding
THE BOARD the nominees for election as members of the Board of
OF DIRECTORS Directors and Directors whose terms of office will continue
after the meeting, based upon data furnished to the
Company by such persons, except as otherwise noted, as of March 31, 1994.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION PAST FIVE YEARS, DIRECTOR
NAME OTHER DIRECTORSHIPS, AND AGE SINCE
---- ------------------------------------ --------
<S> <C> <C>
NOMINEES FOR THE TERM TO EXPIRE IN 1997
Ira Gumberg President of J.J. Gumberg Co. (real estate management and 1992
(1) development) for more than five years; Director of Mellon
Bank, N.A.; age 40.
Alan Rosskamm Chief Executive Officer of the Company for more than five 1985
years, since April 1993, President, and since July 1992,
Chairman of the Board; prior to July 1992, President of
the Company for more than five years; Director of Charming
Shoppes Inc. (women's apparel retailer); age 44.
Scott Cowen Dean of the Weatherhead School of Management and Profes- 1987
(1)(2) sor of Accounting, Case Western Reserve University, for
more than five years; Director of American Greetings
Corporation, Forest City Enterprises, Inc., LDI
Corporation, Premier Industrial Corporation and Society
National Bank; age 47.
DIRECTORS WHOSE TERMS EXPIRE IN 1995
Robert Norton Vice Chairman since March 1993 and Chief Financial Officer 1989
since September 1987; Executive Vice President from Sep-
tember 1988 to March 1993; Chief Administrative Officer
May 1990 to March 1993, of the Company; age 47.
Alma Zimmerman Senior Vice President of the Company for more than five 1967
years; age 81.
DIRECTORS WHOSE TERMS EXPIRE IN 1996
Samuel Krasney Managing Partner, ABBA Capital Enterprises since Septem- 1976
(1)(2) ber 1993; Chairman of the Board, President and Chief Exec-
utive Officer, Banner Aerospace, Inc. June 1990 to
September 1993 and prior thereto Vice Chairman of the
Board, The Fairchild Corporation (formerly Banner Indus-
tries, Inc.) for more than five years; Director of Banner
Aerospace, Inc., and Waxman Industries, Inc.; age 69.
</TABLE>
4
<PAGE> 7
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION PAST FIVE YEARS, DIRECTOR
NAME OTHER DIRECTORSHIPS, AND AGE SINCE
---- ------------------------------------ --------
<S> <C> <C>
Frank Newman President, Chief Operating Officer, and Director of Eckerd 1991
(1)(2) Corporation (retail pharmacy stores) since July 1993;
President and Chief Executive Officer, F & M Distributors
prior to July 1993 for more than five years; age 45.
Betty Rosskamm Secretary of the Company for more than five years and, 1967
since December 1991, Senior Vice President; prior to
December 1991 Treasurer of the Company for more than five
years; age 65.
</TABLE>
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(1) Member of the Audit Committee, which met twice during the fiscal year ended
January 29, 1994. This Committee is responsible for reviewing with the
independent auditors of the Company the scope and thoroughness of the
auditors' examination, reviewing the adequacy of the Company's systems of
internal accounting controls with the independent auditors and recommending
to the Board of Directors the appointment of independent auditors for the
fiscal year.
(2) Member of the Compensation Committee, which met twice during the fiscal year
ended January 29, 1994. This Committee has the authority to set the
compensation for executive officers of the Company. The Committee also makes
recommendations to the Board of Directors with respect to the adoption and
amendment of incentive compensation plans and administers those plans
approved by the Board of Directors.
Martin and Betty Rosskamm are husband and wife and the parents of Alan
Rosskamm. Justin and Alma Zimmerman are husband and wife.
Ira Gumberg is President and a principal shareholder of J.J. Gumberg Co.
J.J. Gumberg Co. owns or manages numerous shopping centers, approximately 12 of
which contain Company fabric stores.
During the fiscal year ended January 29, 1994, there were four meetings of
the Company's Board of Directors. Each incumbent Director, except for Ira
Gumberg, attended at least 75% of the Board meetings and meetings held by the
committees on which he or she served. The Board of Directors has no nominating
committee.
COMPLIANCE WITH Based solely upon a review of Forms 3 and 4 and Amendments
SECTION 16(A) thereto furnished to the Company with respect to its most
OF THE recent fiscal year, and written representations from
EXCHANGE ACT reporting persons that no Form 5 was required, the
Company believes that, during the fiscal year
ended January 29, 1994, all filing requirements applicable to its
executive officers and Directors were met.
DIRECTORS' The Company compensates Directors, other than officers who are
COMPENSATION Directors, for their services on the basis of a $10,000
annual retainer and $1,000 for each day of Board and
committee meetings attended. The Company also maintains the 1988 Stock
Option Plan for Non-Employee Directors (the "Directors Plan"), which provides
automatic one-time grants of options for 15,000 Common Shares to new Non-
Employee Directors as of the date of their initial election and automatic
grants of options for 10,000 Common Shares to each Non-Employee Director upon
completion of five continuous years of service (commencing in 1989) as a
Director. A total of 115,000 Common Shares are currently available for issuance
upon the exercise of options granted or which may be granted under the
Directors Plan. Each option shall terminate on the date that is ten years
following the date of grant; provided, that, in the event of the retirement of
a Director after more than ten years of continuous service, the Compensation
Committee may accelerate the date on which any option (outstanding for a period
of more than twelve months) becomes exercisable. When an optionee ceases to be
a Director of the Company for any reason, that optionee shall continue to have
the right to exercise an outstanding option during the three-month period
immediately following the date of termination of such service.
5
<PAGE> 8
EXECUTIVE The following table sets forth information relating to the
COMPENSATION annual and long-term compensation for the fiscal years
ended January 29, 1994, January 30, 1993, and February 1,
1992, for the Chief Executive Officer and the other four most highly
compensated executive officers of the Company:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
-------------------------
ANNUAL COMPENSATION
- ---------------------------------------------------------------------------- AWARDS
OTHER ------------------------- ALL
ANNUAL OPTIONS/ OTHER
COMPEN- RESTRICTED SARS COMPEN-
NAME AND FISCAL SATION STOCK (E) SATION
PRINCIPAL POSITION YEAR SALARY (A) BONUS (B) (C) AWARD(S) (D) (SHARES) (F)
- ------------------------ ------- ---------- --------- -------- ------------ -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Alan Rosskamm 1994 $341,346 $103,683 -- $ 0 15,000 $ 18,177
Chairman of the Board, 1993 $302,375 $ 0 -- $450,750 50,000 $ 18,044
President and Chief 1992 $260,417 $156,250 -- $840,000 12,000 $ 17,918
Executive Officer
Robert Norton 1994 $301,090 $ 91,485 -- $ 0 12,000 $ 19,145
Vice Chairman of 1993 $266,208 $ 0 -- $450,750 40,000 $ 19,012
the Board and Chief 1992 $234,583 $140,750 -- $735,000 10,000 $ 18,886
Financial Officer
Jane Aggers 1994 $217,468 $ 61,860 -- $136,250 32,000 $ 10,111
Executive Vice 1993 $162,171 $ 12,000 -- $187,813 20,000 $ 4,364
President- 1992 $126,667 $ 63,333 -- $ 0 5,000 $ 3,358
Merchandising and
Marketing
John Stec 1994 $171,090 $ 32,459 -- $ 0 5,000 $ 3,444
Senior Vice President- 1993 $162,250 $ 12,000 -- $ 0 10,000 $ 4,364
Real Estate 1992 $156,250 $ 78,125 -- $ 0 4,000 $ 4,238
Fred Johnson 1994 $159,231 $ 30,660 -- $ 0 10,000 $ 3,428
Senior Vice President 1993 $141,000 $ 12,000 -- $ 75,125 12,500 $ 3,774
Management Information 1992 $125,000 $ 48,500 -- $ 0 2,500 $ 3,335
Systems
</TABLE>
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(A) Includes amounts earned but deferred pursuant to Section 401(k) of the
Internal Revenue Code.
(B) Incentive Bonus Compensation is based on individual percentages established
by the Compensation Committee and is based on achievement of pre-established
performance goals. Amounts represent bonuses earned in the current fiscal
year for which payment is not made until the subsequent fiscal year.
(C) Excludes perquisites and other benefits, unless the aggregate amount of such
compensation is greater than 10 percent of the total of annual salary and
bonus reported for the named executive officer.
(D) Restricted stock consists of Common Shares issued and delivered to the
recipient at the time the award is made without payment to the Company, but
which are subject to restrictions on transfer for, and forfeiture in the
event of termination of employment prior to the expiration of, a specified
period of time (generally at the end of a period of five years). The amounts
reported in the table represent the market value at the date of grant. In
fiscal years 1994, 1993, and 1992, the executive officers listed in the
compensation table received the following numbers of restricted shares,
respectively: Alan Rosskamm -- 0, 12,000, 30,000; Robert Norton -- 0,
12,000, 26,250; Jane Aggers -- 10,000, 5,000, 0; John Stec -- 0, 0, 0; Fred
Johnson -- 0, 2,000, 0. The aggregate number and value of the restricted
stock holdings at January 29, 1994 were for Mr. Rosskamm 75,000 Common
Shares and $1,321,875, Mr. Norton 64,500 Common Shares and $1,136,813, Ms.
Aggers 24,750 Common Shares and $436,219, Mr. Stec 12,000 Common Shares and
$211,500, and Mr. Johnson 6,500 Common Shares and $114,563, without giving
effect to the diminution of value attributable to the restrictions on such
shares. Currently, the Company does not pay cash dividends on its Common
Shares; however, from time to time the Board of Directors may re-examine the
issue of dividend payments. The Common Shares of restricted stock would
participate the same as other Common Shares of the Company regarding
dividend payment.
(E) The Company's 1990 Employees Stock Option and Stock Appreciation Rights
Plan, as amended, provides for the award of incentive and non-qualified
stock options and stock appreciation rights to key employees of the Company.
(F) Reflects matching contributions, equal to 50% of a participant's first 4%
under the Company's Employees' Savings and Profit Sharing Plan and amounts
accrued by the Company for potential benefits earned under the Company's
1979 Supplemental Retirement Benefit Plan (the "1979 Plan"). The 1979 Plan
provides benefits, subject to forfeiture, to such employees upon normal
retirement, early retirement or total disability. In fiscal years 1994,
1993, and 1992, the Company had accrued, under the 1979 Plan, for the
executive officers listed in the compensation table, the following amounts,
respectively: Alan Rosskamm -- $13,680, $13,680, $13,680; Robert
Norton -- $14,648, $14,648, $14,648; Jane Aggers -- $5,816, $0, $0; John
Stec -- $0, $0, $0; Fred Johnson -- $0, $0, $0.
6
<PAGE> 9
OPTION GRANTS TABLE
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information relating to stock option grants
during the last fiscal year for the chief executive officer and the other four
most highly compensated executives of the Company.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- ----------------------------------------------------------------------- POTENTIAL
REALIZABLE VALUE AT
% OF TOTAL EXERCISE ASSUMED ANNUAL RATES OF
OPTIONS OPTIONS OR BASE STOCK PRICE APPRECIATION
GRANTED GRANTED TO PRICE PER FOR OPTION TERM (5)
(SHARES) EMPLOYEES IN COMMON EXPIRATION -------------------------
NAME (1) FISCAL YEAR SHARE DATE (4) 5% 10%
- -------------- ------ ------------ --------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Alan Rosskamm 15,000(2) 5.9% $17.250 12/20/2003 $ 162,726 $ 412,381
Robert Norton 12,000(2) 4.7% $17.250 12/20/2003 $ 130,181 $ 329,905
Jane Aggers 20,000(3) 7.8% $13.625 04/06/2003 $ 171,374 $ 434,295
Jane Aggers 12,000(2) 4.7% $17.250 12/20/2003 $ 130,181 $ 329,905
John Stec 5,000(2) 2.0% $17.250 12/20/2003 $ 77,417 $ 196,190
Fred Johnson 10,000(2) 3.9% $17.250 12/20/2003 $ 108,484 $ 274,921
</TABLE>
- ---------------
(1) The option holder has the right to pay the exercise price by delivering
previously acquired shares of the Company's common stock and to have shares
withheld to satisfy tax withholding requirements in connection with the
exercise of options. Such options become immediately exercisable upon a
Change in Control of the Company, as defined in the option plan. Options are
nontransferable other than by will or the laws of descent and distribution.
(2) Options become exercisable in four equal annual installments commencing
December 20, 1994.
(3) Options become exercisable in four equal annual installments commencing
April 6, 1994.
(4) Options were granted for a term of ten years, subject to earlier termination
in certain events related to termination of employment.
(5) The amounts under the columns labeled "5%" and "10%" are included by the
Company pursuant to certain rules promulgated by the Securities and Exchange
Commission and are not intended to forecast future appreciation, if any, in
the price of the Company's stock. Such amounts are based on the assumption
that the named persons hold the options granted for their full ten year term
and that the market value of the shares appreciate, in value from the market
value on the date of grant at the 5% and 10% annualized rates.
7
<PAGE> 10
OPTION EXERCISES AND YEAR-END VALUE TABLE
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table provides information relating to aggregate option
exercises during the last fiscal year and fiscal year-end option values for the
chief executive officer and the other four most highly compensated executives of
the Company.
<TABLE>
<CAPTION>
NUMBER OF VALUE OF UNEXERCISED
UNEXERCISED IN-THE MONEY
OPTIONS AT OPTIONS AT
COMMON JANUARY 29, 1994 JANUARY 29, 1994
SHARES ACQUIRED VALUE ----------------------------- -----------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------- --------------- --------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Alan Rosskamm 3,000 $ 18,750 110,750 63,000 $ 919,066 $ 198,751
Robert Norton 27,400 $ 123,105 12,500 50,750 $ 35,939 $ 159,232
Jane Aggers 1,500 $ 12,000 32,625 51,375 $ 221,899 $ 117,378
John Stec 0 $ 0 12,375 16,000 $ 57,519 $ 40,925
Fred Johnson 0 $ 0 15,625 21,375 $ 95,379 $ 40,393
</TABLE>
TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL AGREEMENTS
The Company has entered into separate agreements (collectively, the
"Agreements") with Alan Rosskamm and Robert Norton. The Agreements are designed
to retain the executives and provide for continuity of management in the event
of any actual or threatened change in the control of the Company. Each agreement
only becomes operative upon a "Change in Control" of the Company (as defined in
the Agreements) and only if the executive is then in the employ of the Company.
After a Change in Control, each Agreement becomes, in effect, a two-year
employment agreement, providing a salary, bonus and other employee benefits at
not less than the levels existing prior to the Change in Control. If the
executive is terminated by the Company without "cause" as defined in the
Agreement or terminates his employment following a significant change in his
duties, he will be entitled to receive compensation and benefits for the balance
of the two-year period. The executive is obligated to endeavor to mitigate
damages by seeking comparable employment elsewhere and, to the extent he
receives compensation and benefits from another employer, the foregoing payments
and benefits provided by the Company will be reduced accordingly. In each
Agreement, the executive agrees that he will forfeit the foregoing payments and
benefits if he engages in competition with the Company during the period that
any payments are made or benefits provided under the Agreement.
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors ("Committee")
establishes levels of compensation for the Chief Executive Officer and the other
four most highly compensated executive officers, as well as the Company's other
executive officers. The Committee also makes recommendations to the Board of
Directors with respect to the adoption and amendment of incentive compensation
plans and administers those plans approved by the Board of Directors. The
Committee is composed of three non-employee Directors and is accountable to the
Board of Directors on all compensation matters regarding executive officers.
The overall strategy of the Committee is to design and implement
compensation programs that will lead to increases in the Company's return on
shareholders' equity over the long-term. The Committee's strategy is to design a
compensation program that will enable the Company to attract, motivate, and
retain key executives and to establish and maintain a performance and
achievement-oriented environment. The principal elements of this strategy, in
addition to competitive salaries, include an annual bonus program that is based
on operating profit before taxes and long term equity incentives whose value is
dependent on the market price of the Company's Common Shares. These elements are
designed to operate on an integrated basis that enhances the Company's long-term
business objectives. They are described separately in more detail below.
8
<PAGE> 11
SALARY
The Compensation Committee strives to provide a competitive total
compensation package that helps to attract and retain the best people in the
industry. Salary levels are generally set above the mid-point of the salary
ranges at companies that are considered comparable. Salary information about
comparable companies is determined by direct reference to public disclosures
made by selected companies in the specialty retail and fabric industries. These
companies include many of the companies in the S&P Retail Specialty Index
reflected in the performance graph set forth below. In addition, the
Compensation Committee from time to time obtains additional information about
industry salary levels from a retail industry employment consultant.
In general, base salary and other components of compensation are tiered by
job responsibility, with the Chief Executive Officer, Chief Financial Officer,
and the Executive Vice President-Merchandising and Marketing occupying the top
tier. During the 1994 fiscal year, the Compensation Committee increased the
average base salaries of the top tier by 3.3%. Increases in base salary were
also approved for other senior executives based on record sales results in spite
of intense competition for fiscal 1993 and additional duties and
responsibilities assumed during the year.
BONUS
The Compensation Committee places strong emphasis on annual incentive
compensation as a means for building shareholder value over the long term
through consistent annual progress toward improvement in operating profits. The
Company's Key Management Incentive Plan provides a vehicle for the payment of
significant cash bonuses if predetermined levels of operating profit before
taxes are achieved during the year. This operating profit goal is established at
a level which exceeds the Company's prior year's operating profit. Bonuses are
not payable under this Plan to the individuals in the top tier unless the
minimum operating profit target is achieved. During the fiscal year ended
January 29, 1994, the Company's operating profit exceeded the minimum goal. The
amount payable under this Plan is scaled up to a specified maximum for superior
profit performance. In addition to the corporate operating profit goal, the
specific award payable to an executive officer is adjusted based on the degree
by which he or she also meets individual performance goals suitable for the
particular position, which are also determined annually in advance by the
Compensation Committee in the case of the Chief Executive Officer, and in all
other cases by the Chief Executive Officer or the supervising executive officer.
The Key Management Incentive Plan is administered in such a way as to focus
the efforts of participants on meeting the expectations of customers and
shareholders through teamwork. The Plan's foundation on overall operating
profits is intended to provide a common objective that all participants share,
thereby linking their interests with those of the Company's shareholders.
The amounts available for award under this Plan are determined annually. In
general, the award potential for the Chief Executive Officer and the next two
most highly compensated executive officers is designed to provide a minimum
bonus, if any bonus is payable for the year, of 25 percent of the individual's
base salary and a maximum bonus of 75 percent. Bonuses for other executive
officers are designed to amount to a smaller percentage of salary.
STOCK OPTIONS AND RESTRICTED STOCK
The Compensation Committee also selects the recipients and determines the
level of awards of stock options and restricted stock. The option program
includes approximately 1,180 participants, including not only officers but all
levels of the Company's management through the level of store managers. The
number of Common Shares covered by each award is scaled by the Compensation
Committee in its discretion according to compensation level and job
classification. In exercising this discretion, the Committee took into
consideration the overall number of shares available for grant, the number of
options outstanding, the number of shares exercisable, and the option price in
comparison to the market price for the underlying stock. Options granted to the
Chief Executive Officer during the 1994 fiscal year represented only 5.9 percent
of all option grants during the year, and grants to the other four most highly
compensated executives of the
9
<PAGE> 12
Company amounted to less than 25 percent in the aggregate. This broad
participation in the stock option program reflects the Compensation Committee's
strong belief that by providing additional incentives to key employees who have
substantial responsibility for the management and growth of the Company, the
best interests of the shareholders and management will be closely aligned.
Options granted during the 1994 fiscal year vest at the rate of 25 percent
per year. This vesting schedule reflects the Compensation Committee's
determination that options are designed to have a long-term retention effect and
that benefits are realizable over a period of four years.
The Compensation Committee also awards restricted stock as a compensation
vehicle and to attract and retain key executive managers. Generally, awards are
made upon hire or promotion or to recognize superior performance. Currently,
thirteen participants, each of whom is a Vice President or higher of the
Company, holds an award. The only award to an executive officer during fiscal
1994 was a grant of 10,000 shares to Jane Aggers upon her promotion to Executive
Vice President -- Merchandising & Marketing.
All awards of restricted stock made during the last three fiscal years have
provided for vesting at the end of a period not less than four years and not
more than five years after the date of the award. Since the recipient of such an
award would forfeit all of the Common Shares if he or she were to leave the
Company before the end of the vesting period, the Compensation Committee
believes that these awards are a significant factor in the retention of key
management personnel and induce a long-term view among key executive officers.
Restricted stock is also considered a useful compensation vehicle because, even
after it becomes nonforfeitable, it tends to reinforce the recipient's
commitment to continued growth of the Company and appreciation in the market
price of its Common Shares over the long-term.
Effective January 1, 1994, the Omnibus Budget Reconciliation Act of 1993
added Section 162(m) to the Internal Revenue Code. Section 162(m) generally
provides that certain compensation in excess of $1 million per year paid to a
company's chief executive officer and any of its four other highest paid
executive officers is no longer deductible to a company beginning in the 1994
tax year unless the compensation qualifies for an exception. For fiscal year
1995, the Committee believes that no Executive Officer is likely to be paid
compensation exceeding $1 million. Therefore, the Committee does not expect that
Section 162(m) will limit the Company's deductibility of any such compensation.
Section 162(m) provides an exception to the deductibility limit for
performance-based compensation if certain procedural requirements, including
shareholder approval of the material terms of the performance goal, are
satisfied. Accordingly, as part of this Proxy Statement, the Company is
proposing certain amendments to the 1990 Employee Stock Option and Stock
Appreciation Rights Plan which are intended to qualify grants of options and
stock appreciation rights for this exception for performance-based compensation.
The Committee is also currently reviewing the Company's other compensation
programs in light of Section 162(m).
DISCUSSION OF FISCAL 1994 COMPENSATION FOR THE CHAIRMAN AND CHIEF EXECUTIVE
OFFICER
In considering the compensation for the Chairman and Chief Executive
Officer for fiscal 1994, the Committee reviewed his existing compensation
arrangements and both the Company's and individual's performance. For fiscal
1994, the Committee's decisions took into consideration the fact that financial
performance was improving but not yet at the level of expected full performance.
The Committee has made the following determinations regarding Mr. Rosskamm's
compensation:
- Effective March 1, 1993, Mr. Rosskamm's base salary was increased by 3%
from $330,000 to $340,000 based on the Committee's positive assessment of
his performance and contributions during fiscal 1993 as Chairman of the
Board, President, and Chief Executive Officer, which included the
Company's sales increase of 29.9%. The average salary increase for all
individuals in the senior management group was 6.4%. Mr. Rosskamm's
actual salary for the twelve months ending February 28, 1993 was less
than the $330,000 set for him due to a 20% salary reduction from August 1
through November 30, 1992.
10
<PAGE> 13
- Based on the financial performance of the Company for fiscal 1994, the
Committee approved an annual incentive compensation award of $103,683.
This represents 31% of his salary and 23% of Mr. Rosskamm's total annual
compensation for fiscal 1994. Mr. Rosskamm did not receive an incentive
compensation award for fiscal 1993 performance.
- As part of his overall compensation package for fiscal 1994, the
Committee awarded Mr. Rosskamm stock options for 15,000 Common Shares.
This represented 5.9% of the total number of shares awarded to all
employees during fiscal 1994.
- No Restricted Stock award was made to Mr. Rosskamm during fiscal 1994.
The foregoing report on fiscal year 1994 executive compensation was
submitted by the Compensation Committee and shall not be deemed to be
"soliciting material" or to be "filed" with the SEC or subject to Regulation 14A
promulgated by the SEC or Section 18 of the Exchange Act. The names of the
Directors who serve on the Compensation Committee are set forth below:
COMPENSATION COMMITTEE
SAMUEL KRASNEY (Chairman)
SCOTT COWEN
FRANK NEWMAN
11
<PAGE> 14
PERFORMANCE Set forth below is a line graph comparing the yearly
GRAPH percentage change in the cumulative shareholder return,
which includes the reinvestment of cash dividends
(if applicable), of the Company's Common Shares with the cumulative
total return of the S&P Composite - 500 Stock Index and the S&P Retail
Specialty Index for the Company as of January 31, (the date nearest the end of
the Company's fiscal year for which index data is readily available) for each
of the Company's last five years.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
S&P COM- S&P RETAIL
MEASUREMENT PERIOD POSITE - 500 SPECIALTY
(FISCAL YEAR COVERED) FCA INDEX INDEX
<S> <C> <C> <C>
1989 100 100 100
1990 117 114 117
1991 224 124 134
1992 482 152 181
1993 193 168 238
1994 206 190 233
</TABLE>
* ASSUMES $100 INVESTED ON JANUARY 31, 1989 IN THE COMPANY'S COMMON SHARES, S&P
COMPOSITE - 500 STOCK INDEX & S&P RETAIL SPECIALTY INDEX AND THAT ALL
DIVIDENDS WERE REINVESTED.
APPROVAL OF The Board of Directors believes that the 1990 Employees Stock
AMENDMENTS TO Option and Stock Appreciation Rights Plan (the "Plan") and
THE 1990 its predecessor plans have promoted the interests of the
EMPLOYEE STOCK Company by enabling it, through the grant of
OPTION AND STOCK stock options and stock appreciation rights ("SARs"), to
APPRECIATION retain and attract key personnel. They have also provided
RIGHTS PLAN incentive to such personnel by affording them the
opportunity to purchase Common Shares. The Company
has granted options to a wide range of employees, from the Chief
Executive Officer through the ranks of store managers. At present, there are
approximately 1,180 optionees holding options for approximately 1,256,500
shares. As of April 30, 1994, however, the Company only had 196,035 shares
available for grant under the Plan. By an Action of the Board of Directors
taken on May 9, 1994, the Board adopted and recommended shareholder approval of
an amendment to the Plan which would increase by 750,000 the number of shares
with respect to which options may be granted and to limit at 100,000 shares the
number of nonqualified options, SARs, and incentive stock options ("ISOs")
which may be granted to an eligible employee during any calendar year.
Under the Plan as currently in effect, the Board of Directors may amend the
Plan, except that certain amendments that have the effect of increasing
available benefits, including an
12
<PAGE> 15
increase in the number of shares with respect to which options or SARs may be
granted, require shareholders' approval.
The principal features of the Plan, as amended, are summarized in this
Proxy Statement. The full text of the Plan may be obtained by writing to Chief
Financial Officer, Fabri-Centers of America, Inc., 5555 Darrow Road, Hudson,
Ohio 44236.
The Plan is administered by the Compensation Committee of the Board of
Directors (the "Committee"). The Committee may grant ISOs or nonqualified
options to any key employee (including officers) of the Company or of any
subsidiary, and a SAR may be granted to any key employee who holds or is
concurrently granted an option under the Plan. The Plan currently does not limit
the number of shares that may be covered by nonqualified options granted to
employees and successive options may be granted to the same person. The
aggregate fair market value of the shares for which an optionee may be granted
ISOs that become exercisable in any calendar year is limited to $100,000.
Effective January 1, 1994, the Omnibus Budget Reconciliation Act of 1993 added
Section 162(m) to the Internal Revenue Code ("Code"). Section 162(m) generally
provides that certain compensation in excess of $1 million per year paid to a
company's chief executive officer and any of its four other highest paid
executive officers is no longer deductible to a company beginning in the 1994
tax year unless the compensation qualifies for an exception. Section 162(m)
provides an exception to the deductibility limit for performance-based
compensation if certain procedural requirements are satisfied. In order to
qualify for the exception, the Plan has been amended, subject to shareholder
approval, to limit at 100,000 shares the number of nonqualified options, SARs,
and ISOs which may be granted to any eligible employee during any calendar year.
The option price shall be determined by the Committee or Board of Directors
and, in the case of ISOs, may not be less than 100% of the fair market value of
the Common Shares on the date of the option grant. Upon any change in the Common
Shares by reason of a stock dividend, stock split or reorganization, the number
and class of shares subject to each outstanding option and the option price will
be appropriately adjusted. On May 9, 1994, the closing sale price of the
Company's Common Shares as reported for New York Stock Exchange - Composite
Transactions was $13.75.
An option will not be exercisable until the employee has completed one full
year of employment after the option is granted. Thereafter, the option generally
is exercisable in its entirety or in installments over such number of years,
generally four, as the Committee may determine. An option shall terminate and no
longer be exercisable at the time set forth in the grant (generally ten years).
The time for exercise of outstanding options will be accelerated in the event of
certain transactions involving the Company. An option may be exercised only
while the optionee is an employee, subject to limited rights of exercise
following termination of employment. The option price must be paid in full at
the time of exercise and may be paid in cash, in Common Shares, or a combination
of cash and shares. SARs may be exercised only when the related option is
exercisable and shall expire upon termination of the option. SARs held by an
officer and payable, in whole or in part in cash, generally may be exercised
only after the expiration of six months following date of grant and during a
ten-day period following the release of the Company's quarterly or annual
financial results.
Shares subject to unexercised options that are surrendered or expire for
reasons other than the exercise of a related SAR become available again for the
grant of options under the Plan.
Under the Internal Revenue Code of 1986, as amended ("the Code"), an
employee who is granted an option or related SAR under the Plan will realize no
income, and the Company will receive no deduction, for federal income tax
purposes at the time of the grant. When a non-qualified stock option is
exercised, the optionee will realize ordinary income, and the Company will be
entitled to a deduction, in an amount equal to the excess of the fair market
value of the Common Shares at the date of exercise over the option price.
Generally, no taxable income will result from exercise of an ISO if certain
requirements are met; the individual will realize taxable income only at the
time of disposition of all or a portion of his shares, and the Company will
receive no deduction. When a SAR is exercised the optionee will realize ordinary
income and the Company will be entitled to a deduction, in an amount equal to
any cash received by the
13
<PAGE> 16
optionee and the fair market value on the date of exercise of any shares
received by the optionee.
Approval of the amendments to the Plan requires the affirmative vote of the
holders of at least a majority of the shares present or represented and entitled
to vote at the Annual Meeting. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE
APPROVAL OF THE AMENDMENTS TO THE PLAN.
The following table sets forth information regarding benefits that would
have been received assuming the Plan, as proposed and amended, was in effect as
of January 31, 1993 for the Chief Executive Officer, the other four most highly
compensated executive officers, all executive officers as a group, and all
employees, who are not executive officers of the Company, as a group. Except for
Mr. Alan Rosskamm and Mr. Norton, none of the current Directors or nominees for
election as a Director has received any benefits under the Plan. The number of
options indicated represents an amount equal to the number of options which
would have been granted in fiscal 1994 had the Plan, as amended, been in effect
during fiscal 1994. The number of options indicated is the same as the number
actually granted in fiscal 1994 under the Plan prior to amendment.
AMENDED PLAN BENEFITS
1990 EMPLOYEES STOCK OPTION AND STOCK APPRECIATION RIGHTS PLAN
<TABLE>
<CAPTION>
NUMBER OF
OPTIONS
NAME AND POSITION (SHARES)
----------------- ---------
<S> <C>
Alan Rosskamm
Chairman of the Board, President and Chief Executive
Officer.............................................. 15,000
Robert Norton
Vice Chairman of the Board and Chief Financial
Officer.............................................. 12,000
Jane Aggers
Executive Vice President--Merchandising &
Marketing............................................ 32,000
John Stec
Senior Vice President--Real Estate................... 5,000
Frederick Johnson
Senior Vice President--Management Information
Systems.............................................. 10,000
All executive officers as a group...................... 74,000
All employees, who are not executive officers, as a
group................................................ 181,500
</TABLE>
APPROVAL OF Purpose. The proposed 1994 Executive Incentive Plan (the
1994 EXECUTIVE "1994 Plan") is designed to benefit the Company, to retain
INCENTIVE PLAN and attract executive, managerial, technical and
professional personnel for the Company and
to provide additional incentive to such personnel through increased
stock ownership in the Company. The 1994 Plan will succeed the Executive
Incentive Plan, adopted in 1980 and amended thereafter, which expired January
29, 1994. The Board of Directors adopted the 1994 Plan on May 9, 1994, and
recommends shareholder approval at the 1994 Annual Meeting of Shareholders.
A summary of the material provisions of the 1994 Plan is set forth below,
but such summary is qualified in its entirety by reference to the text of the
1994 Plan, which is attached to this Proxy Statement as Exhibit A.
General. The 1994 Plan provides for the awarding of Restricted Stock.
Restricted Stock consists of the Company's Common Shares which will be issued or
delivered to the recipient at
14
<PAGE> 17
the time the award is made without payment to the Company, but which will be
subject to restrictions on transfer for, and forfeiture in the event of
termination of employment prior to the expiration of, a specified period of time
(not in excess of five years).
The maximum number of shares of Restricted Stock which may be issued or
delivered under the 1994 Plan is 500,000 shares. The maximum number of
restricted shares which may be granted to any eligible employee during any
calendar year shall not exceed 100,000. The 1994 Plan provides for appropriate
adjustments in the number of shares of Restricted Stock which may be awarded in
the event of changes in the outstanding Common Shares of the Company by reason
of stock splits, merger, or similar events. The Company's Common Shares which
may be issued or delivered under the 1994 Plan may be either authorized but
unissued shares or treasury shares.
Administration. The 1994 Plan will be administered by a Committee made up
of not less than three Directors who are not eligible to participate in the 1994
Plan. The Committee will have the exclusive power to determine which employees
shall participate in the 1994 Plan, the type of award to be made, and the other
terms and conditions of the award, subject the provisions of the 1994 Plan.
Eligibility. Only executive officers and other senior management personnel
who have significant responsibility for the growth of the Company will be
eligible to receive awards under the 1994 Plan. Presently, 14 persons would be
eligible to receive awards.
Restricted Stock Awards. At the time of an award of Restricted Stock, the
Company and the recipient will enter into a written agreement containing such
terms and conditions as the Committee may require. The award or the agreement,
or both, will establish the period or time during which the shares may not be
transferred or otherwise disposed of and will provide that the Restricted Stock
shall be forfeited and returned to the Company in the event the recipient ceases
to be an employee of the Company prior to the expiration of such period for any
reason other than death, total disability, or retirement. The 1994 Plan provides
that the restrictions will lapse at the end of not less than four years and not
more than five years. If a recipient of Restricted Stock dies, becomes totally
disabled, or retires before the end of such period, the restrictions will lapse
as to a number of shares determined on a pro rata basis by reference to the
portion of the entire period which has elapsed. In addition, the Committee has
the discretion to accelerate the lapse of restrictions whenever, by reason of
changes in tax or other laws or circumstances, it decides such action is in the
best interest of the Company and equitable to the recipient.
Subject to the restrictions on transfer and the risk of forfeiture, a
holder of Restricted Stock will have all the rights of a shareholder, including
the right to receive dividends paid on such shares and to vote such shares
except that any securities received as a result of any such dividend or
distribution shall be subject to the same restrictions. Certificates
representing shares of Restricted Stock may be deposited in escrow and may bear
a legend referring to the restrictions on transfer.
Amendment of the 1994 Plan. The Board of Directors may amend the 1994
Plan, but no such amendment may increase the number of shares of Restricted
Stock which may be awarded under the 1994 Plan, either in the aggregate or to
any individual, extend the time within which awards may be made, or materially
modify the requirements as to eligibility to participate in the 1994 Plan,
without shareholder approval. No such amendment may affect an outstanding award
without the consent of the recipient.
Federal Tax Consequences. Under present federal income tax laws, a
participant generally will not realize income upon receipt of an award of
Restricted Stock (unless the recipient makes the election referred to in the
next paragraph). Upon the lapse of the restrictions on the Restricted Stock, the
recipient will realize ordinary income equal to the fair market value of the
shares at the time the restrictions lapse.
Under a special provision of the Internal Revenue Code, a recipient of
Restricted Stock may elect, within the thirty-day period after the date of
award, to include the fair market value of
15
<PAGE> 18
the shares received by him, valued at the date of receipt, as ordinary income in
the year of such receipt. If such election is made, no additional income will be
recognized by him upon the lapse of the restrictions, but no deduction or loss
will be allowed if the shares are subsequently forfeited. The Company will be
entitled to a deduction for federal income tax purposes when and in the same
amount as a participant in the 1994 Plan is considered to have realized income
and to the extent that the amount is not in excess of limitations set by Section
162(m) of the Code.
The Committee may permit a participant to satisfy, in whole or in part, any
withholding tax obligation that may arise in connection with the lapse of
restrictions by having the Company retain a portion of the Common Shares subject
to the award, with a fair market value equal to the amount of the withholding
tax obligation. The fair market value of the Common Shares to be delivered or
retained shall be determined as of the date immediately preceding the date on
which the amount of the withholding tax obligation is determined.
When an employee disposes of Common Shares acquired under the 1994 Plan,
any amount received in excess of the fair market value of the shares on the date
of the lapse of the restrictions with respect to Restricted Stock, will be
treated as long or short term capital gain, depending upon the holding period of
the shares. If the amount received is less than such fair market value of the
shares, the loss will be treated as long or short term capital loss, depending
upon the holding period of the shares.
Vote Required. The affirmative vote of the holders of a majority of the
Common Shares present or represented and entitled to vote at the Annual Meeting
is required to adopt a resolution approving the 1994 Plan. THE BOARD OF
DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE 1994 PLAN.
The following table sets forth information regarding benefits that would
have been received assuming the 1994 Executive Incentive Plan, as proposed to be
adopted, was in effect as of January 31, 1993 for the Chief Executive Officer,
the other four most highly compensated executive officers, all executive
officers as a group, and all employees, who are not executive officers of the
Company, as a group. Except for Mr. Alan Rosskamm and Mr. Norton, none of the
current Directors or nominees for election as a Director will receive any
benefits under the 1994 Plan. The number of shares indicated represents an
amount equal to the number of restricted shares which would have been granted in
fiscal 1994 had the 1994 Plan, as proposed to be adopted, been in effect during
fiscal 1994. The number of shares indicated is the same as the number actually
granted in fiscal 1994 under the previous Executive Incentive Plan. The dollar
value of the restricted shares is based on the number of shares indicated
multiplied by the fair market value of Company's Common Stock on April 6, 1993.
April 6, 1993 is the date on which restricted shares would have first been
granted in fiscal 1994. The values indicated are not necessarily indicative of
the dollar values which may be realized by the named executive officers and
groups identified.
16
<PAGE> 19
NEW PLAN BENEFITS
1994 EXECUTIVE INCENTIVE PLAN
<TABLE>
<CAPTION>
NUMBER OF DOLLAR
NAME AND POSITION SHARES VALUE
----------------- --------- --------
<S> <C> <C>
Alan Rosskamm
Chairman of the Board,
President and Chief
Executive Officer........................................... 0 $ 0
Robert Norton
Vice Chairman of the
Board and Chief
Financial Officer........................................... 0 $ 0
Jane Aggers
Executive Vice President --
Merchandising & Marketing................................... 10,000 $136,250
John Stec
Senior Vice President --
Real Estate................................................. 0 $ 0
Frederick Johnson
Senior Vice President --
Management Information Systems.............................. 0 $ 0
All executive officers
as a group....................................................... 10,000 $136,250
All employees, who are not
executive officers, as a group................................... 0 $ 0
</TABLE>
INDEPENDENT Arthur Andersen & Co. have been appointed as the Company's
AUDITORS independent auditors for the fiscal year ending January 28,
1995. A representative of Arthur Andersen & Co. is expected
to be present at the meeting with an opportunity to make a statement if
he desires to do so and to answer appropriate questions with respect to that
firm's examination of the Company's financial statements and records for the
fiscal year ended January 29, 1994.
PROXY The Company will bear the expense of preparing, printing and
SOLICITATION mailing this Proxy Statement. In addition to solicitation
by mail, officers and regular employees of the Company
may solicit by telephone the return of Proxies. The Company will
request brokers, banks and other custodians, nominees and fiduciaries to send
Proxy material to beneficial owners and will, upon request, reimburse them for
their expense.
SHAREHOLDERS' The deadline for shareholders to submit proposals to be
PROPOSALS considered for inclusion in the Proxy Statement for the
1995 Annual Meeting of Shareholders is expected to
January 28, 1995.
ANNUAL The Company's Annual Report for the fiscal year
REPORT ended January 29, 1994, including financial statements
of the Company and the report thereon of Arthur
Andersen & Co., is being mailed to shareholders with this Notice of the
Annual Meeting and Proxy Statement.
BETTY ROSSKAMM,
Secretary
By order of the Board of Directors
May 27, 1994
17
<PAGE> 20
EXHIBIT A
Adopted: June 27, 1994
FABRI-CENTERS OF AMERICA, INC.
EXECUTIVE INCENTIVE PLAN
1. Purpose of the Plan
The purpose of this Executive Incentive Plan (the "Plan") is to further the
growth of Fabri-Centers of America, Inc. by offering incentives in addition to
current cash compensation to those executive officers and senior management
personnel of the Company who will have significant responsibility for such
growth.
2. Definitions
(a) The "Company" means Fabri-Centers of America, Inc., an Ohio
corporation, and its Subsidiaries, together with their successors.
(b) "Subsidiary" means any corporation the majority of the outstanding
voting stock of which is owned, directly or indirectly, by the Company.
(c) "Committee" means the Committee of the Company's Board of Directors
appointed to administer the Plan in accordance with Section 4.
(d) "Award" means an award of Restricted Stock granted under the provisions
of the Plan.
(e) "Stock" means the shares of Common Stock, without par value, of the
Company.
(f) "Restricted Stock" means the Stock awarded upon the terms and
conditions and subject to the restrictions set forth in Section 6, which
restrictions shall lapse at the times set forth in that Section.
(g) "Restricted Stock Award" means an award of Restricted Stock.
(h) "Date of Grant" means the actual date on which the Award is made by the
Committee.
(i) "Plan Year or Years" means a fiscal year or years commencing on or
after January 30, 1994.
(j) "Fair Market Value" shall mean the average of the closing market prices
of a share of Common Stock of the Company reported in the consolidated trading
reports for New York Stock Exchange stocks on the 15 trading days immediately
preceding the date in question.
(k) "Retirement" means a Termination of Employment by reason of an
Employee's retirement (other than by reason of disability) after he has attained
age 65 or pursuant to and in accordance with his employer's regular retirement
plan applicable to him.
(l) "Total Disability" means inability of an Employee, by reason of illness
or accident, to perform any and every duty of the occupation at which the
Employee was employed by the Company when such disability commenced. All
determinations as to the date and extent of disability of any Employee shall be
made by the Committee upon the basis of such evidence as the Committee deems
necessary or desirable.
(m) "Termination of Employment" means the time when the employee-employer
relationship between the Employee and the Company or a Subsidiary is terminated
for any reason, including, but not limited to, a termination by resignation,
discharge, death, Total Disability, or Retirement, but excluding any such
termination where there is a simultaneous reemployment by either the Company or
a Subsidiary. The receipt by an Employee of compensation following the
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<PAGE> 21
cessation of performance of duties as an employee pursuant to a salary
continuation, severance or similar plan shall not be deemed to continue the
employee-employer relationship.
(n) "Employee" means any person (including any officer) employed by the
Company, and no Employee shall be excluded because he is also a member of the
Board of Directors of the Company.
3. Effective Date of the Plan
The effective date of the Plan shall be January 30, 1994, and the Plan
shall become effective as of that date upon the approval of the Company's
shareholders.
4. Administration of the Plan
The Plan shall be administered by the Committee, which shall consist of not
less than three members of the Board of Directors, appointed from time to time
by, and who shall serve at the pleasure of, the Board. No Director who is or has
within one year prior to service, or during the course of service, on the
Committee been granted or awarded the right to receive an Award under the Plan
or to participate in any other discretionary compensation or bonus plan of the
Company shall serve on the Committee.
Subject to the provisions of the Plan, the Committee shall have exclusive
power to select the Employees who are to participate in the Plan, to determine
the Award to be granted to each Employee selected and to determine the time or
times and the conditions subject to which any Awards may become payable or any
restrictions thereon will lapse.
Decisions and determinations by the Committee will be final and binding
upon all persons, including, but not limited to, the Company, shareholders,
participants in the Plan, and other Employees. The Committee shall have the
authority to interpret the Plan, to establish and revise rules and regulations
relating to the Plan, and to make any other determinations that it believes
necessary or advisable for the administration of the Plan.
All expenses and liabilities incurred by the Company in the administration
of the Plan shall be borne by the Company. The Committee may, with the approval
of the Board of Directors, employ attorneys, consultants, accountants, or other
persons. The Committee, the Company, and its officers and directors shall be
entitled to rely upon the advice, opinion, or valuations of any such persons. No
member of the Committee shall be personally liable for any action,
determination, or interpretation taken or made in good faith with respect to the
Plan, and all members of the Committee shall be fully protected by the Company
in respect of any such action, determination, or interpretation.
5. Plan Limitations; Stock Subject to the Plan
The number of Common Shares that may be issued or transferred under the
Plan, in the form of awards of shares of Restricted Stock shall not exceed, in
the aggregate, 500,000. Any shares of Restricted Stock that have been awarded
under the Plan but are later forfeited to the Company may again be made subject
to Awards under the Plan, but only if no dividends have been paid thereon. The
Stock that may be issued or transferred under the Plan may be either authorized
but unissued shares or "treasury shares" as defined in Section 1701.01(K), of
the Ohio General Corporation Law.
6. Restricted Stock Awards
6.1 Grant of Restricted Stock Awards. The Committee may from time to time
in its absolute discretion select from among the Employees those executive
officers and other senior management personnel who have significant
responsibility for the growth of the Company and to whom Restricted Stock Awards
shall be granted and determine the number of shares of Stock to be covered by
each Restricted Stock Award.
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6.2 Award Agreements. Each Restricted Stock Award shall be evidenced by a
written agreement, executed by the grantee of the Restricted Stock Award and the
Company, which shall contain such terms and conditions as the Committee may
require, including, but not limited to, an escrow condition.
6.3 Restrictions. Stock issued or transferred to a grantee of a
Restricted Stock Award shall be subject to the following restrictions.
(a) None of the Restricted Stock may be sold, assigned, disposed of,
pledged, hypothecated, or otherwise transferred.
(b) All of the Restricted Stock shall be forfeited and shall be
returned to the Company and all rights of the grantee to such Restricted
Stock shall terminate without any payment of consideration by the Company
unless the grantee remains in the continuous employment of the Company for
such period as the Committee shall designate in accordance with Section
6.5, except as provided in Sections 6.6 and 6.7. In the event of forfeiture
of the Restricted Stock, the grantee shall forthwith deliver to the Company
the certificate or certificates representing such Restricted Stock,
accompanied by executed instruments of transfer, or, if the Restricted
Stock is held in escrow, the Company shall be entitled to have the
certificates representing the Restricted Stock redelivered to it out of the
escrow.
(c) The maximum number of shares of Restricted Stock which may be
granted to any Employee during any calendar year shall not exceed 100,000
shares.
6.4 Rights As a Shareholder. Upon delivery of the Restricted Stock to the
grantee (or to the escrow holder, if any) as a Restricted Stock Award, such
grantee shall (except as set forth in Section 6.3) have all of the rights of a
shareholder with respect to the Restricted Stock, including the right to vote
the shares of Restricted Stock and receive all dividends or other distributions
paid or made with respect to the Restricted Stock except that any securities
received as a result of any such dividend or distribution shall be subject to
the same restrictions.
6.5 Lapse of Restrictions. The restrictions set forth in Section 6.3
shall lapse at such time or times as the Committee, in its sole discretion,
shall designate at the time of grant of the Restricted Stock Award, which time
or times, however, shall be not less than four years and not more than five
years after the date of the Award.
6.6 Lapse on Death, Total Disability, or Retirement. In the event that
the employment of a grantee of a Restricted Stock Award is terminated prior to
the lapse of the restrictions on his Restricted Stock by reason of death, Total
Disability, or Retirement, the restrictions shall lapse on the date of such
termination as to the number of full shares of Restricted Stock determined by
multiplying the total number of shares of Stock subject to each Restricted Stock
Award by a fraction, the numerator of which shall be the number of full calendar
months between the date of grant of such Restricted Stock Award and the date of
Termination of Employment and the denominator of which shall be the number of
full calendar months between the date of grant of such Restricted Stock Award
and the date on which the restrictions would, but for such termination, have
lapsed. Shares of Restricted Stock as to which restrictions have not so lapsed
shall be forfeited and returned to the Company as provided in Section 6.3.
6.7 Lapse at Discretion of the Committee. The Committee shall have the
authority to accelerate the time at which the restrictions will lapse or to
remove any of such restrictions whenever it may decide in its absolute
discretion that, by reason of changes in applicable tax or other laws or other
changes in circumstances arising after the date of the Award, including, but not
limited to, an offer by a person other than the Company to purchase or otherwise
acquire 25% or more of the total number of outstanding shares of Stock, such
action is in the best interest of the Company and equitable to the Employee, his
heirs, or designated beneficiaries.
A-3
<PAGE> 23
7. Dilution and Other Adjustments
In the event of any change in the outstanding shares of Stock by reason of
any stock dividend or split, recapitalization, merger, consolidation, spinoff,
reorganization, combination or exchange of shares, or other similar corporate
change, the Committee shall make such adjustments, if any, as it in its sole
discretion deems equitable in the aggregate number or kind of shares of Stock
that may be awarded as Restricted Stock such adjustments to be conclusive and
binding upon all parties concerned.
8. Acquisition for Investment
Each Employee to whom a distribution of Stock is made pursuant to the Plan
may be required by the Company to furnish a representation that he is acquiring
the shares so distributed as an investment and not with a view to distribution
thereof if the Committee shall, in its sole discretion, determine that such
representation is required to insure that resale or other disposition of the
shares would not involve a violation of the provision of the Securities Act of
1933, as amended, or of applicable state blue sky laws. Any investment
representation so furnished shall no longer apply at any time such
representation is no longer necessary for such purposes. The Company also
reserves the right to place any legend or other symbol on the share certificates
issued or transferred pursuant to the Plan and to furnish any stop transfer or
similar instructions to the transfer agent for its Common Stock or other shares
which the Company, in its sole discretion, may deem necessary and proper to
assure compliance with any such representation.
9. Compliance with Securities and Exchange Commission Requirements
No certificate for shares of Stock distributed pursuant to the Plan shall
be executed and delivered until the Company shall have taken such action, if
any, as is then required to comply with the provisions of the Securities Act of
1933, as amended, the Securities Exchange Act of 1934, as amended, the Ohio
Securities Act, as amended, any other applicable state blue sky laws, and the
requirements of any exchange on which the Stock may, at the time, be listed.
10. Withholding Tax Election
The Committee, in its discretion and subject to such rules as the Committee
may adopt, may permit a participant to satisfy, in whole or in part, any
withholding tax obligation that may arise in connection with the lapse of
restrictions hereunder by having the Company retain a portion of the Common
Stock subject to the award, with a Fair Market Value equal to the amount of the
withholding tax obligation. The Fair Market Value of the Common Stock to be
retained shall be determined as of the date immediately preceding the date on
which the amount of the withholding tax obligation is determined.
11. Designation of Beneficiary
An Employee may, with the consent of the Committee, designate a person or
persons to receive, in the event of his death, any Stock to which he would then
be entitled. Such designation shall be made upon forms supplied by and delivered
to the Company and may be revoked in writing. If an Employee fails effectively
to designate a beneficiary, then his estate shall be deemed to be his
beneficiary.
There shall be deducted from each distribution under the Plan the amount of
any tax required by any governmental authority to be withheld and paid over by
the Company to such governmental authority for the account of the person
entitled to such distribution. With respect to any distribution of Stock, the
Company shall have the right to sell without notice, such number of shares of
Stock distributable to the person entitled to such distribution as will provide
funds for payment of any tax so required to be paid by the Company for his
account, unless, prior to such sale, he shall have paid to the Company the
amount of such tax. Any
A-4
<PAGE> 24
balance of the proceeds of such sale shall be paid to such person. In effecting
any such sale, the Company shall be deemed to be acting on behalf, and for the
account, of such person.
12. Employment
Awards shall be made to Employees under the Plan only in consideration of
services performed for the Company or for its benefit. Nothing in the Plan or in
any Award shall confer upon any Employee the right to continue in the employ of
the Company or shall interfere with or restrict in any way the rights of the
Company to discharge any Employee at any time for any reason whatsoever, with or
without cause.
13. Effect Upon Other Plans
The adoption of the Plan shall not affect any stock option or other
compensation or incentive plan in effect for the Company or any subsidiary, and
the Plan shall not preclude the Board of Directors from establishing any other
forms of incentive or compensation for Employees.
14. Amendment of the Plan
The Board of Directors may at any time and from time to time modify or
amend the Plan in any respect, except that without shareholder approval the
Board of Directors may not increase the maximum number of shares of Stock to be
issued or transferred under the Plan, extend the period during which Awards may
be granted, or materially modify the requirements as to eligibility for
participation in the Plan. Any modification or amendment of the Plan shall not,
without the consent of an Employee, affect his rights under an Award previously
granted to him.
15. Termination of the Plan
The right to grant Awards under the Plan shall terminate automatically at
the close of business on January 31, 2004, or upon the granting of Awards
equaling the maximum numbers set forth in Section 5 hereof, whichever shall
first occur, and, thereafter, the function of the Committee will be limited to
the administration of Awards previously granted, subject to additional shares of
Stock becoming available for Award by reason of forfeitures or terminations of
earlier Awards prior to January 31, 2004. In addition, the Board of Directors
shall have the right to suspend or terminate the Plan at any time or from time
to time provided that no such action shall, without the consent of the Employee,
adversely affect any rights or obligations under Awards previously granted.
A-5
<PAGE> 25
FABRI-CENTERS OF AMERICA, INC.
BOARD OF DIRECTORS PROXY
THIS PROXY IS BEING
SOLICITED BY THE
BOARD OF DIRECTORS.
PLEASE COMPLETE,
SIGN, AND RETURN
PROMPTLY.
ANNUAL MEETING, JUNE 27, 1994
At the Annual Meeting of Shareholders of the
Company to be held on June 27, 1994, and at any
adjournment, Betty Rosskamm, Robert Norton and Samuel
Krasney, or any one of them, is hereby authorized to
represent me and thereat to vote my shares on the
following:
1. Election of Directors. The nominees of the Board
of Directors to the class whose term of office
will expire in 1997 are:
Ira Gumberg, Alan Rosskamm and Scott Cowen.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR
ANY INDIVIDUAL NOMINEE(S) WRITE THE NAME(S) OF
THE NOMINEE(S) IN THE SPACE PROVIDED BELOW.)
-------------------------------------------------------
2. Approval of the amendments to the 1990 Employees
Stock Option and Stock Appreciation Rights Plan.
/ / FOR / / AGAINST / / ABSTAIN
(Continued, and to be signed, on other side)
(Continued from reverse side)
3. Adoption of the Company's 1994 Executive
Incentive Plan.
/ / FOR / / AGAINST / / ABSTAIN
4. In accordance with their best judgment, upon any
other matters which may properly come before the
meeting.
/ / FOR / / AGAINST / / ABSTAIN
SHARES REPRESENTED BY PROPERLY EXECUTED PROXIES WILL BE
VOTED AS SPECIFIED. UNLESS OTHERWISE SPECIFIED, THIS
PROXY WILL BE VOTED FOR THE ELECTION AS DIRECTORS OF
THE NOMINEES LISTED ABOVE.
Signed this day of ,
1994
---------------------------
---------------------------
Please give title when
signing as executor,
administrator, trustee,
attorney or other
representative. If shares
are registered in the names
of joint tenants or
trustees, each joint tenant
or trustee should sign.
PLEASE DATE AND SIGN EXACTLY AS THE NAMES APPEAR ON THE
FACE OF THE PROXY AND RETURN BY MAILING PROMPTLY IN THE
ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE.
<PAGE> 26
CONFIDENTIAL VOTING INSTRUCTIONS
TO: SOCIETY NATIONAL BANK, TRUSTEE UNDER THE FABRI-CENTERS OF
AMERICA, INC.
EMPLOYEES' SAVINGS AND PROFIT-SHARING PLAN
Pursuant to the provisions of the Fabri-Centers of America, Inc.
Employees' Savings and Profit-Sharing Plan, the undersigned, as a
participant in or beneficiary of the Plan, having received the
Notice and accompanying Proxy Statement for the Annual Meeting of
Shareholders of the Company to be held on June 27, 1994, hereby
directs the Trustee to vote (in person or by proxy) shares of Common
Stock of the Company credited to the undersigned's account under the
Plan on the record date for the Annual Meeting, and at any
adjournment thereof, on the following:
1. Election of Directors. The nominees of the Board of Directors
to the class whose term of office will expire in 1997 are:
Ira Gumberg, Alan Rosskamm and Scott Cowen.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE(S) WRITE THE NAME(S) OF THE NOMINEE(S) IN THE SPACE
PROVIDED BELOW.)
--------------------------------------------------------------------
2. Approval of the amendments to the 1990 Employees Stock Option
and Stock Appreciation Rights Plan.
/ / FOR / / AGAINST / / ABSTAIN
(Continued, and to be signed, on other side)
(Continued from reverse side)
3. Adoption of the Company's 1994 Executive Incentive Plan.
/ / FOR / / AGAINST / / ABSTAIN
4. In accordance with their best judgment, upon any other
matters which may properly come before the meeting.
/ / FOR / / AGAINST / / ABSTAIN
THESE VOTING INSTRUCTIONS WHEN PROPERLY EXECUTED WILL BE VOTED IN
THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED PARTICIPANT OR
BENEFICIARY. IF THESE VOTING INSTRUCTIONS ARE EXECUTED AND RETURNED
TO THE TRUSTEE, WITHOUT DIRECTION, THEY WILL BE VOTED FOR THE
ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE.
PLEASE SIGN EXACTLY AS NAME APPEARS BELOW.
Dated , 1994
---------------------------
(Participant or
Beneficiary)
These confidential voting instructions will be seen only by
authorized personnel of the Trustee.
PLEASE COMPLETE, SIGN, DATE AND RETURN THIS CONFIDENTIAL VOTING
CARD PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
