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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 240.14a-11(c) or 240.14a-12
APPAREL AMERICA, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
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APPAREL AMERICA, INC.
1175 State Street
New Haven, Connecticut 06511
December 17, 1996
Dear Shareholder:
Once again, it is my pleasure to invite you to our annual meeting of
shareholders, which will be held on January 29, 1997, at 10:00 a.m. at the
University Club, 1 West 54th Street, New York, New York 10022.
At the meeting, we will elect six (6) directors for a one year term
expiring in 1998, appoint independent public accountants for the Company and
transact such other business as may come before the meeting.
Your Board of Directors and I look forward to meeting with you and
sincerely hope you will be present at the meeting. Even if you plan to attend
the meeting, please return your signed proxy as soon as possible.
Sincerely,
BURTON I. KOFFMAN
Chairman of the Board
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APPAREL AMERICA, INC.
1175 STATE STREET
NEW HAVEN, CONNECTICUT 06511
NOTICE OF 1997 ANNUAL MEETING OF SHAREHOLDERS
December 17, 1996
To the Shareholders of
APPAREL AMERICA, INC.:
NOTICE IS HEREBY GIVEN that the annual meeting of shareholders of Apparel
America, Inc. will be held at the University Club, 1 West 54th Street, New York,
New York 10022, on January 29, 1997, at 10:00 a.m., for the following purposes:
(1) to elect six (6) directors who will constitute the entire Board
of Directors;
(2) to appoint independent public accountants for the Company for
fiscal year 1997, and;
(3) to transact such other business as may come before the meeting or
any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on December 16, 1996
as the record date for the determination of shareholders who will be entitled to
notice of and to vote at the meeting.
Each shareholder is requested to date, sign and return the accompanying
proxy in the enclosed return envelope, to which no postage need be affixed if
mailed in the United States.
By order of
the Board of Directors,
RICHARD E. KOFFMAN
Secretary
<PAGE>
APPAREL AMERICA, INC.
1175 STATE STREET
NEW HAVEN, CONNECTICUT 06511
PROXY STATEMENT
This proxy statement is furnished to the shareholders of Apparel America,
Inc. (the "Company") in connection with the solicitation of proxies to be used
in voting at the Annual Meeting of Shareholders (the "Annual Meeting") to be
held on January 29, 1997 and at any adjournments of such Annual Meeting. The
enclosed proxy is solicited on behalf of the Board of Directors of the Company.
Enclosed with this Proxy Statement is the Company's Annual Report on Form 10-K
for the year ended July 31, 1996.
Any shareholder giving a proxy may revoke it at any time prior to its use
at the meeting. A proxy may be revoked in writing delivered to the Company, or
by attending the Annual Meeting and voting in person. Submission of a later
dated proxy will revoke any earlier dated proxy. Unless previously revoked,
proxies so delivered will be voted at the meeting. Where a choice or
instruction is specified by the shareholder thereon, the proxy will be voted in
accordance with such specification. Where a choice or instruction is not
specified by such shareholder, the proxy will be voted as recommended by the
directors.
I.ELECTION OF DIRECTORS
To be elected, each director must receive the affirmative vote of the
holders of a plurality of the issued and outstanding shares of Common Stock
represented in person or by proxy at the Annual Meeting.
The Board of Directors recommends that the shareholders elect Burton I.
Koffman, Richard E. Koffman, Jeffrey P. Koffman, Arthur G. Cohen, Bernard
Tessler and Eric T. Weitz, who have been duly nominated by the Board of
Directors, to serve a term of one year as directors, until the next Annual
Meeting of Shareholders or until his successor is elected and qualified.
It is the intention of the persons named as proxies to vote the proxies,
unless the authority to vote is specifically withheld, to elect as directors the
six (6) nominees set forth below (see "Nominees for Election as Directors"). In
the event any nominee should not continue to be available for election, such
proxies will be voted for the election of such other person as the Board of
Directors may recommend. The Company does not presently contemplate that any of
the nominees will become unavailable for election for any reason.
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The Board of Directors recommends a vote FOR this proposal.
II.NOMINEES FOR ELECTION AS DIRECTORS
The following table sets forth certain information regarding the nominees
for election to the Company's Board of Directors:
NAME AGE CAPACITY
---- --- --------
Burton I. Koffman 71 Chairman of the Board
and Chief Executive Officer
of the Company
Richard E. Koffman 64 Vice Chairman of the
Board, Executive Vice
President and Secretary
of the Company
Jeffrey P. Koffman 31 Director and President of
the Company
Arthur G. Cohen 66 Director of the Company
Eric T. Weitz 52 Director and Executive Vice
President of the
Company; President of the
Robby Len Division
Bernard Tessler 46 Director of the Company
______________________________
Burton I. Koffman has served as Chairman of the Board of the Company
since January 1989 and as Chief Executive Officer of the Company since October
1989. Mr. Koffman served as President of the Company from January 1989 until
October 1989 and from June 1995 to February 1996.
Richard E. Koffman has served as Vice Chairman of the Board of the
Company since October 1989 and as a Director, Executive Vice President and
Secretary of the Company since January 1989. Mr. Koffman is also Treasurer,
Vice President, Secretary, and a Director of Empire Industries, Inc. and
Executive Vice President and Secretary of Public Loan Company, Inc.
Jeffrey P. Koffman has served as a Director of the Company since June
1995 and Executive Vice President from June 1994 to February 1996. Mr. Koffman
was appointed President of the Company in February 1996. Mr. Koffman served as a
financial analyst with Security Pacific from 1987 to 1989. In 1989, Mr. Koffman
became Vice President of Pilgrim Industries and in 1990, he became the President
of that Company. From 1994 to present, Mr. Koffman has served in an executive
capacity with Tech Aerofoam Products.
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Arthur G. Cohen has served as a Director of the Company since July 25,
1989. Mr. Cohen is a self-employed real estate developer and investor. Among
other positions, he serves as Chairman of the Board of The Arlen Corporation.
Eric T. Weitz has served as a Director of the Company since January
1995 and as President of the Robby Len Division since January 1994. Mr. Weitz
was appointed Executive Vice President of the Company in February 1996. Mr.
Weitz served as Vice President - Marketing for Robby Len Fashions from 1983
until it was acquired by the Company in January 1989 and continued in that
capacity for the Company's Robby Len Division until January 1994. Previously,
Mr. Weitz served in various sales and executive capacities in the apparel
industry.
Bernard Tessler was elected a Director of the Company in February
1996. Mr. Tessler is Chairman, President and Chief Executive Officer of LFS
Acquisition Inc., a company which owns a chain of children's specialty apparel
stores, a position he assumed in June 1995. From 1987 to 1991, Mr. Tessler was
President and CEO of Children's Creative Workshop, Ltd.
Messrs. Burton I. Koffman and Richard E. Koffman are brothers and
Jeffrey P. Koffman is the son of Burton I. Koffman.
The Board of Directors held two meetings during the year ended July
31, 1996. All other actions of the Board of Directors during the year ended
July 31, 1996 were taken by unanimous written consent. There are two committees
of the Board of Directors, an Audit Committee and an Executive Compensation
Committee. The Company has no standing nominating committee of the Board of
Directors or committee performing a similar function. Officers are elected by,
and serve at the discretion of, the Board of Directors.
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III. OWNERSHIP INTEREST OF OFFICERS, DIRECTORS AND
NOMINEES FOR BOARD OF DIRECTORS
The following table sets forth the holdings, as of December 1, 1996,
of the Company's Common Stock by (i) each person who held of record more than 5%
of the Company's Common Stock, (ii) each of the directors of the Company and
(iii) all directors and officers as a group:
SHARES
TITLE OF BENEFICIALLY PERCENT
NAME AND ADDRESS CLASS OWNED OF CLASS
- ---------------- -------- ------------ --------
PLC, Inc. Common Stock 4,211,400(1) 21.31%
300 Plaza Drive $.05 par value
Vestal, New York
Mayfair Industries, Inc. Common Stock 3,563,640(1) 18.03%
300 Plaza Drive $.05 par value
Vestal, New York
Burton I. Koffman Common Stock 2,124,456(2) 10.75%
300 Plaza Drive $.05 par value
Vestal, New York
REK Corp. Common Stock 1,901,677(1) 9.62%
300 Plaza Drive $.05 par value
Vestal, New York
Richard E. Koffman Common Stock 1,074,037(2) 5.43%
300 Plaza Drive $.05 par value
Vestal, New York
Arthur G. Cohen Common Stock 884,000(3) 4.47%
1501 Broadway $.05 par value
New York, New York
Jeffrey P. Koffman Common Stock 600,000 3.04%
300 Plaza Drive $.05 par value
Vestal, New York
All Directors and Common Stock 5,187,599(4) 26.25%
Officers as a Group $.05 par value
(5 persons)
The Koffman Group Common Stock 15,220,778(5) 77.02%
(13 persons) $.05 par value
300 Plaza Drive
Vestal, New York
________________
(1) PLC, Inc., Mayfair Industries, Inc. and REK Corp. are substantially all
owned, directly or indirectly, by members of the Koffman family. See
Footnote (5) below.
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(2) The number of shares of Common Stock set forth herein includes 943 shares
of Common Stock jointly held by Messrs. Burton I. Koffman and Richard E.
Koffman, of which each owns an undivided 50% interest, and 645,817 in the
case of Mr. Burton I. Koffman and 601,347 in the case of Richard E. Koffman
of the shares held by Empire Industries, Inc. and Public Loan Company,
Inc., all of the stock of which is owned directly or indirectly by them and
members of their families.
(3) Mr. Arthur G. Cohen holds the shares of Common Stock set forth herein for
the benefit of Ben Arnold Company, Inc., a corporation owned 50% by members
of Mr. Cohen's immediate family, the beneficial ownership of which Mr.
Cohen disclaims, and 50% by members of Messrs. Burton I. Koffman and
Richard E. Koffman's immediate families, the beneficial ownership of which
each disclaims. Mr. Cohen also disclaims beneficial ownership of 194,720
shares of Common Stock owned by Karen Cohen, his wife.
(4) The number of shares of Common Stock set forth herein includes the shares
of Common Stock reported above for Messrs. Burton I. Koffman, Richard E.
Koffman, Arthur C. Cohen and Jeffrey P. Koffman. Also included herein are
505,106 shares of Common Stock beneficially owned by Mr. David L. Koffman,
a Vice President and Assistant Secretary of the Company and the son of
Burton I. Koffman and brother of Jeffrey P. Koffman.
(5) The members of this reporting group include Messrs. Burton I. Koffman,
Richard E. Koffman, Jeffrey P. Koffman, David L. Koffman and members of
their immediate families, as well as entities controlled by members of the
Koffman family. The number of shares of Common Stock set forth herein
includes the shares of Common Stock reported above for Messrs. Burton I.
Koffman, Richard E. Koffman, Jeffrey P. Koffman and David L. Koffman.
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IV. SALARIES AND COMPENSATION OF OFFICERS, DIRECTORS AND
NOMINEES FOR BOARD OF DIRECTORS
The following table sets forth all compensation paid or accrued by the
Company for the years ended July 31, 1996, July 31, 1995 and July 31, 1994, to
or for the chief executive officer and the remaining four most highly
compensated executive officers and key employees of the Company.
SUMMARY COMPENSATION TABLE
--------------------------
NAME AND ANNUAL COMPENSATION ALL OTHER
PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION ($)
- ------------------ ---- --------- -------- ----------------
Burton I. Koffman 1996 - - 40,000
Chairman of the Board, 1995 - - 40,000
Chief Executive 1994 - - 40,000
Officer of the Company
Eric T. Weitz 1996 240,000 33,240 3,840
Executive Vice Pres- 1995 240,000 144,600 4,800
ident of the Company, 1994 192,000 100,000 -
President of the Robby
Len Division
Mark D. Greenberg 1996 150,000 16,620 3,696
V.P. of the Company, 1995 150,000 72,300 3,000
V.P. - Operations 1994 150,000 50,000 -
of the Robby Len
Division
Murray Merl 1996 136,500 16,620 3,347
V.P. of Manufacturing 1995 130,000 54,225 2,600
of Robby Len Division 1994 100,000 37,500 -
Frederick M. D'Amato 1996 110,300 16,620 3,770
Vice President - 1995 105,000 54,225 2,100
Finance 1994 100,000 25,000 -
Directors who are not officers or employees of the Company receive an
annual fee of $5,000 and $500 per meeting attended for their services as
directors. The Board of Directors held two meetings during the year ended July
31, 1996.
Mr. Burton I. Koffman and Mr. Richard E. Koffman receive an annual
consulting fee of $40,000 (as disclosed above) and $60,000, respectively. Mr.
Jeffrey P. Koffman receives an annual salary of $36,000.
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COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
THE REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
SHALL NOT BE DEEMED FILED UNDER THE SECURITIES ACT OF 1993 (THE "SECURITIES
ACT") OR UNDER THE SECURITIES EXCHANGE ACT OF 1934 (THE "EXCHANGE ACT").
GENERAL
The Compensation Committee was established in 1989 when the Company
acquired the existing Robby Len Division and the now discontinued Mayfair
Division. At the time of the 1989 acquisitions, the Company's Compensation
Committee reviewed the compensation level of the executive officers of Robby Len
and Mayfair and adopted their existing compensation plans. The members of the
Compensation Committee for the last fiscal year were Burton I. Koffman, Jeffrey
P. Koffman and Arthur G. Cohen.
COMPENSATION PHILOSOPHY
The Compensation Committee's executive compensation philosophy is to
provide competitive levels of compensation, integrate executive officer's pay
with the achievement of the Company's annual and long-term performance goals,
reward above average corporate performance, recognize individual initiative and
achievement, and assist the Company in attracting and retaining qualified
executive officers. Executive officer compensation is intended to be set at
levels that the Compensation Committee believes are consistent with others in
the Company's industry and gives emphasis to the need for the best creative
talent available in product related positions.
The Compensation Committee plans to further review the Company's
existing executive officer compensation plans in 1997 and intends to modify such
plans as required to fit within the announced philosophy of the Committee.
BASE SALARIES
Base salaries for new executive officers are determined initially by
evaluating the responsibilities of the position held and the experience of the
individual, and by reference to the competitive marketplace for managerial and
creative talent. Annual salary adjustments are determined by evaluating the
competitive marketplace, the performance of the Company, the performance of the
executive and any increased responsibilities assumed by the executive. Salary
adjustments are determined and normally made on an annual basis.
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Salaries for the year ended July 31, 1996 for Messrs. Merl and D'Amato
were based on levels established and approved by the Company's Board of
Directors in August 1995. Mr. Greenberg's salary for the year ended July 31,
1996 was based on a level established and approved by the Company's Board of
Directors in August 1992. Mr. Weitz's salary for the year ended July 31, 1996
was based on a level established and approved by the Company's Board of
Directors in August 1994. Mr. Burton I. Koffman's compensation is based on a
consulting arrangement.
ANNUAL BONUSES
The Company has a bonus incentive program for its executive officers.
The bonuses, if any, awarded are based upon minimum levels of profitability, as
defined. Based on the performance of the Robby Len Division, bonuses were
awarded for the year ended July 31, 1996 to Messrs. Weitz, Greenberg, Merl and
D'Amato.
Dated: December 16, 1996 THE COMPENSATION COMMITTEE
BURTON I. KOFFMAN
JEFFREY P. KOFFMAN
ARTHUR G. COHEN
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V. VOTING SECURITIES OUTSTANDING
Only holders of record of Common Stock at the close of business on December
16, 1996 will be entitled to vote at the meeting. On such date, there were
outstanding 19,762,645 shares of Common Stock, each share of which entitles the
holder to one vote.
VI. COMMON STOCK PERFORMANCE
The following graph compares the yearly percentage change in the
Company's cumulative total stockholder return on Common Stock with (i) the
cumulative total return of the NASDAQ market index and (ii) the cumulative total
return of companies with the standard industrial code (SIC) Code 2339 over the
period from August 1, 1991 through July 31, 1996. The component entities of SIC
Code 2339 were generated by Media General Financial Service, Inc. All the
entities in SIC Code 2339 were incorporated into the peer group.
[GRAPH]
- ----------------------------Fiscal Year Ending --------------------------------
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
Apparel America Inc. 100.00 100.00 100.00 100.00 200.00 900.00
Industry Index 100.00 68.87 39.75 41.32 52.94 55.75
(SIC Code 2339)
Broad Market Index 100.00 102.46 127.27 138.88 170.19 185.53
(NASDAQ Market)
Assumes $100 invested on August 1, 1991. Assumes dividends reinvested
through fiscal year ended July 31, 1996.
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VII. SHAREHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Any shareholder desiring to present a proposal to the shareholders at the
1998 Annual Meeting of Shareholders, currently scheduled for January 29, 1998,
must transmit such proposal to the Company so that it is received by the Company
at its principal executive offices on or before October 31, 1997. All such
proposals should be in compliance with applicable Securities and Exchange
Commission regulations.
VIII. ELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The selection of an independent public accountant is decided by a vote of
the shareholders. The Board of Directors has selected BDO Seidman, LLP which has
acted as auditors of the Company since 1989, to act as auditors for its current
fiscal year. In the event the shareholders do not ratify the selection by the
Board of Directors, the Board of Directors will replace BDO Seidman, LLP with
the shareholders selection.
Unless otherwise specified, shares represented by proxies will be voted for
the appointment of BDO Seidman, LLP as auditors for fiscal year 1997.
Representatives of BDO Seidman, LLP are expected to be present at the Annual
Meeting. Such representatives will have the opportunity to make a statement if
they desire to do so and are expected to be available to respond to appropriate
questions.
IX. METHOD OF SOLICITATION
The solicitation of proxies will be principally by mail, and may be
followed by telephone and personal contacts by officers, directors or regular
employees of the Company. As stated below in Article XI, the cost of
solicitation will be borne by the Company. The costs of proxy solicitation are
not expected to exceed $10,000, unless circumstances require otherwise. Brokers
and others holding shares of Common Stock in their names or in the names of
their nominees will be expected to forward copies of the Company's proxy
soliciting material to beneficial owners of such shares and to seek authority
for execution of proxies and will be reimbursed by the Company for their
reasonable expenses.
X. ANNUAL REPORT
The Company's Annual Report on Form 10-K for the year ended July 31, 1996
including financial statements, is being furnished with this Proxy Statement to
shareholders of record as of December 16, 1996. The Annual Report on Form 10-K
does not constitute a part of the proxy solicitation materials although the
financial information and Management Discussion and Analysis contained therein
is incorporated herein by reference.
The Company will bear the cost of the solicitation of proxies including the
charges and expenses of brokerage firms and others for forwarding solicitation
material to beneficial owners of shares of the Common Stock of the Company.
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This proxy, when properly executed will be voted in the manner directed
herein by the undersigned shareholder. If no direction is made, this proxy will
be voted for Proposals 1, 2 and 3.
The undersigned acknowledges receipt of the accompanying Annual Report and
Proxy Statement dated December 17, 1996.
_________________________ _________________________
Account Number Common Shares
1. ELECTION OF BURTON I. KOFFMAN, RICHARD E. KOFFMAN, JEFFREY P. KOFFMAN,
ARTHUR G. COHEN, BERNARD TESSLER and ERIC T. WEITZ (Strike out name(s) of any
nominee(s) against whom you are voting) as Directors of the Company to serve for
one year until the Company's 1998 Annual Meeting (Mark Only One)
____ For ____Against
2. RATIFICATION OF THE RE-APPOINTMENT OF BDO SEIDMAN, LLP as independent
accountants of the Company (Mark only one).
____ For ____ Against ____ Abstain
3. In their discretion, upon any other business which may properly come
before the meeting or any adjournment thereof.
(When signing as attorney, trustee, executor, administrator, guardian
corporate officer, etc., please give full title. If more than one trustee, all
should sign. Joint owners must each sign.)
______________________________
Date
______________________________
Signature
______________________________
Signature
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PROXY
APPAREL AMERICA, INC.
PROXY SOLICITED ON BEHALF OF THE APPAREL AMERICA, INC. BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Burton I. Koffman, Richard
E. Koffman and Jeffrey P. Koffman, and each of them, with full power of
substitution, attorneys and proxies to represent and to vote all of the shares
of Common Stock which the undersigned would be entitled to vote, with all
powers the undersigned would possess if personally present, at the Annual
Meeting of Shareholders of Apparel America, Inc. (the "Company"), to be held at
the University Club, 1 West 54th Street, New York, New York 10022, on January
29, 1997, at 10:00 A.M., local time, and at any adjournment thereof, on all
matters coming before said meeting.
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