<PAGE>
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
NANTUCKET INDUSTRIES, INC.
(Name of Registrant as Specified in Its Charter)
NANTUCKET INDUSTRIES, INC.
(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:
Set forth the amount on which the filing fee is calculated and state how it was
determined.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or
schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule, or registration statement no.:
(3) Filing party:
(4) Date filed:
<PAGE>
NANTUCKET INDUSTRIES, INC.
510 BROADHOLLOW ROAD
MELVILLE, NEW YORK 11747
-------------------
FORMAL NOTICE OF SPECIAL MEETING IN LIEU OF
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD OCTOBER 22, 1997
-------------------
We are pleased to notify you that the Special Meeting in Lieu of Annual
Meeting of Stockholders of NANTUCKET INDUSTRIES, INC., a Delaware corporation,
will be held at 180 Madison Avenue, 14th Floor, New York, New York, on
Wednesday, October 22, 1997, commencing at 11:00 a.m. on that day, and
thereafter as it may be from time to time adjourned.
At the meeting, stockholders will consider and take action upon the
following proposals:
1. To set the number of directors constituting the Board of Directors
at nine and to elect those directors who have been nominated for terms expiring
in 2000.
2. To ratify the appointment of Grant Thornton LLP, independent
certified public accountants, to audit the consolidated financial statements of
the Company and its subsidiaries for fiscal 1998.
3. To transact such other business as may properly be brought before
the meeting and any adjournment or adjournments thereof.
The Board of Directors has fixed the close of business on September 8,
1997 as the record date for the determination of the stockholders entitled to
receive notice of, and to vote at, the meeting. A form of proxy and a return
envelope which requires no postage are enclosed. We urge you to exercise your
privilege as a stockholder of Nantucket Industries, Inc. by voting upon the
business to come before the meeting either by signing and returning the enclosed
form of proxy or by casting your vote in person at the meeting.
By Order of the Board of Directors
RONALD S. HOFFMAN
Secretary
510 Broadhollow Road
Melville, New York 11747
September 15, 1997
<PAGE>
NANTUCKET INDUSTRIES, INC.
510 BROADHOLLOW ROAD
MELVILLE, NEW YORK 11747
-------------
PROXY STATEMENT
-------------
The form of proxy enclosed with this statement is solicited by the
Board of Directors of NANTUCKET INDUSTRIES, INC., a Delaware corporation (the
"Company"), for use at the Special Meeting in Lieu of Annual Meeting of
Stockholders of the Company (the "Special Meeting") to be held at 180 Madison
Avenue, 14th Floor, New York, New York commencing at 11:00 a.m. on Wednesday,
October 22, 1997 and at any adjournments thereof. Stockholders of record at the
close of business on September 8, 1997, are entitled to notice of, and to vote
at, the meeting. At the close of business on September 8, 1997, there were
outstanding 3,238,796 shares of Common Stock, par value $.10 ("Common Stock"),
each share being entitled to one vote. This proxy statement and the accompanying
notice and proxy are being mailed to the Company's stockholders on or about
September 15, 1997.
Each of the persons named as proxies in the enclosed form of proxy was
selected by the Board of Directors and is a director of the Company. The proxy,
if signed and returned, may, nevertheless, be revoked by the stockholder at any
time before it is exercised and will not in any way affect the stockholder's
right to attend the meeting and vote in person. Any revocation shall be effected
by filing with the Secretary of the Company at the Company's address set forth
above a written revocation or a duly executed proxy bearing a later date,
neither of which need be notarized. If the enclosed form of proxy is properly
executed and returned in time to be voted at the meeting, the proxies named
therein will vote the shares represented by the proxy in accordance with the
instructions marked thereon. Unmarked proxies will be voted for the election as
directors of the nominees of management and in favor of the ratification of the
appointment of Grant Thornton LLP as auditor and in favor of all other items set
forth herein. This solicitation of proxies is made by the Board of Directors and
all expenses of this solicitation will be paid by the Company.
I. ELECTION OF DIRECTORS
Under the Company's by-laws, the number of directors is to be fixed at
not fewer than three nor more than twelve. Pursuant to a vote of the Board of
Directors, the size of the Board has been set at nine directors, of which three
are to be elected at the meeting. The vacancy created by the resignation of
Roger A. Williams, a Class II Director, will not be filled at this time. Each of
the persons named as proxies in the enclosed form of proxy has stated that
shares represented by the proxies given will be voted to elect as directors of
the Company the nominees of management hereinafter listed. If any of the
nominees should unexpectedly become unavailable for election, the shares
represented by the proxies will be voted for a substitute nominee or nominees
named by the Board of Directors of the Company or will be voted to fix the
number of directors at a lesser number than nine which will reflect the number
of nominees available for election.
The Company's Board of Directors is divided into three classes, the
terms of office of which expire in successive years as follows: Class I (current
term expiring at the special meeting), Class II (current term expires in 1998)
and Class III (current term expires in 1999). The directors who will stand for
election by the stockholders will be the Class I directors, whose terms of
office will not continue after the date of the meeting. Each of the nominees
listed below has indicated his willingness to serve if elected, and the Board of
Directors does not anticipate that any of them will become unavailable for
election. Messrs. Samberg, Rosen and Cole were previously elected directors of
the Company at meetings of stockholders.
<PAGE>
The table below sets forth for each nominee for election as a director,
and for each director whose term of office will continue after the Special
Meeting, such person's name, age and other positions with the Company at the
date of this proxy statement, and the year such person was first elected as a
director:
<TABLE>
<CAPTION>
DIRECTOR (AGE) AND POSITION WITH YEAR FIRST ELECTED DIRECTOR
THE COMPANY
CLASS I - NOMINEES FOR TERMS EXPIRING IN 2000
<S> <C> <C>
Stephen M. Samberg (52) Chairman of the Board and Chief 1988
Executive Officer
Robert M. Rosen* (52) 1983
Warren D. Cole* (38) 1994
CLASS II - CURRENT TERM EXPIRES IN 1998
George J. Gold (75) 1966
Joseph Visconti (51) President 1996
Kenneth Klein* (58) 1996
CLASS III - CURRENT TERM EXPIRES IN 1999
Donald D. Gold (71) 1966
Ronald S. Hoffman (54) Chief Financial Officer and Secretary 1994
</TABLE>
* Member of the Audit and Compensation Committees
Set forth below is information regarding the principal occupations of
each director during the past five years and other directorships held by each
director in public companies.
WARREN D. COLE has been the Executive Vice President and Chief
Financial Officer of The Macklowe Organization, a large, privately-held real
estate investment, development and management company based in New York City.
GEORGE J. GOLD had been Chairman of the Board, Chief Executive Officer
and Treasurer of the Company, which positions he resigned on March 18, 1994.
DONALD D. GOLD had been the Secretary of, and since September 1993,
Vice Chairman of the Company, which positions he resigned on March 18, 1994.
Until September 1993, Mr. Gold also served as President of the Company.
RONALD S. HOFFMAN has been Chief Financial Officer of the Company since
July, 1994 and Secretary thereof since October, 1994. Prior to his employment
with the Company, Mr. Hoffman was President of North Country Supply, Inc. and so
served for two years. From 1990 until 1992, Mr. Hoffman was a financial
consultant to clients in financial services and distribution activities. From
1984 until 1990, he served as Chief Financial Officer of ElectroSound Group,
Inc.
-2-
<PAGE>
KENNETH KLEIN has been engaged in the private practice of law since
January 1, 1997. From 1994 until December 1996, Mr. Klein served as President
and a director of National Capital Benefits Corp. a financial services company.
From January 1992 to March 1994 Mr. Klein was the President of Viatical Funding
Company, a financial services company. From January 1988 to January 1992, Mr.
Klein was the Senior Vice President, Chief Operating Officer and General Counsel
of Amivest Corporation, a New York Stock Exchange, Inc. Member Firm and an NASD
Registered Investment Advisor. Mr. Klein also serves as a director and trustee
of several privately-held companies and not-for-profit entities. Mr. Klein
serves as a director pursuant to the Purchase Agreement with NAN Investors, L.P.
as further described under the heading "Certain Relationships and Related
Transactions."
ROBERT M. ROSEN has been a partner in the law firm of Lane Altman &
Owens LLP, general counsel to the Company.
STEPHEN M. SAMBERG has been Chairman and Chief Executive Officer of the
Company since March 18, 1994. From September 1993 until December 31, 1995, Mr.
Samberg also served as President of the Company.
JOSEPH VISCONTI became President of the Company effective January 1,
1996. From July 1991 through December 31, 1995, Mr. Visconti was President and
Chief Executive Officer of Salant Corp.'s Men's and Children's Apparel Division.
From June 1987 to June 1991, Mr. Visconti was President of the William Carter
Company.
All executive officers of the Company are directors.
Executive officers of the Company are elected annually for a term of
office expiring at the Board of Directors meeting immediately following the next
succeeding Annual Meeting of Stockholders, or until their successors are duly
elected and qualified; however, except as set forth below, each of the Company's
current executive officers is employed under a written employment contract
(described below).
George J. Gold and Donald D. Gold are brothers. None of the other
directors or executive officers of the Company are related to each other.
The Board of Directors held four meetings during the fiscal year ended
March 1, 1997, including regularly scheduled and special meetings, and took
action by written consent on two other occasions. The Board of Directors of the
Company does not have a nominating committee. The Company has established an
Audit Committee which approves the scope of, and reviews with the accountants
the results of, the annual audit and otherwise reviews and monitors the
Company's audit program. The Audit Committee held two meetings during the fiscal
year ended March 1, 1997. The Compensation Committee, which reviews the cash
compensation and employment arrangements of the Company's executive officers and
administers the Company's 1992 Executive Long Term Stock Option Plan did not
meet during fiscal 1997. No director attended less than 75%, in the aggregate,
of the Board meetings and meetings of committees on which he served which were
held while he was a director or committee member, respectively.
SECTION 16(A) OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of Forms 3 and 4 and amendments thereto,
furnished to the Company during the fiscal year ended March 1, 1997 and Forms 5
and amendments thereto furnished to the Company with respect to the fiscal year
ended March 1, 1997, no director, officer or beneficial owner of more than 10%
of the Company's equity securities failed to file on a timely basis reports
required by Section 16(a) of the Exchange Act during the fiscal year ended March
1, 1997 except as follows:
-3-
<PAGE>
(1) The Maurice Marciano Trust made two late Form 4 filings relating
to two gift transactions.
(2) The Paul Marciano Trust made one late Form 4 filing relating to
one gift transaction.
(3) The Armand Marciano Trust made one late Form 4 filing relating to
one gift transaction.
(4) George J. Gold made two late Form 4 filings relating to the sale
of shares.
(5) Donald D. Gold made two late Form 4 filings relating to the sale
of shares.
(6) Warren D. Cole made one late Form 4 filing relating to the sale
of shares.
EXECUTIVE COMPENSATION
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors of the Company has
furnished the following report on executive compensation:
OVERVIEW
During fiscal year 1997, the Compensation Committee (the "Committee")
consisted of Robert M. Rosen, Roger A. Williams and Warren D.Cole, each of whom,
while serving on the Committee, was a Director of the Company who was not also
an executive officer of the Company and who was not eligible for selection as a
person to whom stock options or bonus awards might have been granted under the
1992 Plans (described below) or any other discretionary plan of the Company
entitling participants to acquire stock or stock options of the Company. As of
the date of this proxy statement, Messrs. Rosen, Cole and Klein are members of
the Committee.
The Committee is responsible for reviewing the cash compensation and
employment arrangements of the Company's executive officers and for
administering the Company's 1992 Long-Term Executive Stock Option Plan and 1992
Executive Performance Benefit Plan.
At the direction of the entire Board of Directors, the Committee has
made compensation decisions intended to place increased emphasis on
performance-based compensation. A key strategy has been a reduction in fixed
salaries and greater use of awards under the stock option and bonus plans
described below.
Specific compensation arrangements between the Company and most of its
senior executives, including the Company's Chief Executive Officer and its two
other most highly compensated executive officers (the "Named Executives"), are
set forth in written employment agreements with terms described below under the
caption "Employment Agreements and Change in Control Arrangements." These
agreements consist of the following key elements: annual payments of base salary
and/or commissions and discretionary awards of stock options and deferred cash
bonuses which are generally subject to forfeiture upon departure from the
Company.
BASE SALARIES
The maximum annual compensation for the Chief Executive Officer was set
in 1994 at an amount approximating his annual compensation for each of the
previous three years, which
-4-
<PAGE>
consisted entirely of commissions. In recognition of his duties as Chairman and
Chief Executive Officer, the Committee believed that a base salary supplemented
by a discretionary bonus was the most appropriate compensation mechanism. Based
on this belief, his annual compensation was set as a fixed base amount equal to
$500,000 (representing approximately 60% of his average annual compensation
during the three years prior to 1994) and a discretionary annual bonus equal to
a maximum of $300,000 (representing approximately 40% of his average annual
compensation during such three years). In June 1997 due to the financial
condition of the Company and the management changes and cost cutting measures
which were implemented, the base salary of the Chief Executive Officer was
reduced from $500,000 to $300,000 with an incentive program based on commissions
equal to 1 1/2 of net sales to specified customers of the Company's products.
The Board of Directors determined that while a discretionary bonus should
continue, a cap on the Chief Executive Officer's annual compensation of $500,000
should be in place. The Company did not grant any bonus to the Chief Executive
Officer during fiscal 1997.
In June 1997, the Board of Directors also determined that, due to the
financial condition of the Company and the management changes and cost cutting
measures which were implemented, the annual salary of the President be reduced
to $150,000 and the bonus program, as presently structured, be eliminated. An
incentive program based on commissions of 1 1/2% net sales to specified
customers of the Company was also established.
The Board of Directors also recommended that the salary and benefits of
the Company's Chief Financial Officer remain at the current level but that the
Company not extend his employment agreement. The Board of Directors approved
severance arrangements with other senior managers whose services were no longer
required by the Company.
Other executive salaries were set at a level commensurate with that
paid by similar companies to similarly situated executives. In general, it is
the policy of the Company to provide executives with stock options and long term
performance-based incentives as a portion of their total compensation packages.
Further, in the case of executives whose performance is directly linked to
certain product lines, such executives' salaries are linked in whole or part to
the performance of that product line.
STOCK OPTIONS
In fiscal year 1993, the Company adopted the 1992 Executive Long-Term
Stock Option Plan pursuant to which employees, officers, directors and
consultants of the Company may be granted options to purchase the Company's
Common Stock. The plan is intended to give participants the opportunity to
obtain a proprietary interest in the Company and a direct stake in its
continuing performance, and, therefore, to more closely align the interests of
the participants with the interests of the Company and its stockholders. The
plan is also intended to provide participants with an incentive for continued
employment with the Company.
In fiscal 1997, no awards were made under this Plan.
BONUS AWARDS
In fiscal year 1993, the Company adopted the 1992 Executive Performance
Benefit Plan pursuant to which executives and key employees of the Company may
earn deferred compensation for achievement of individual or Company-wide sales,
earnings or other performance targets as the Committee selects. The amount of
each award is determined by the Committee after consideration of the executive's
or employee's total compensation, responsibilities and performance, as well as
the Company's business plan and prospects.
In fiscal year 1997, no awards were made under this Plan.
By the Compensation Committee
-5-
<PAGE>
Robert M. Rosen
Warren D. Cole
Kenneth Klein
COMPENSATION OF DIRECTORS
Directors, other than those employed by the Company, are paid $5,000
annually and an additional $500 for each Board or committee meeting attended in
person.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The law firm of Lane Altman & Owens LLP, of which Robert M. Rosen, a
director of the Company and a member of the Compensation Committee, is a
partner, is general counsel to the Company. Legal fees for professional services
rendered by Lane Altman & Owens LLP to the Company accrued in fiscal 1997 were
in the amount of $185,000.
License fees for the Company's use of certain trademarks of Guess ?,
Inc., of which Roger A. Williams, a former director of the Company and member of
the Compensation Committee, was until recently its Chief Financial Officer, were
$294,000 in fiscal 1997. Effective July 21, 1997, Mr. Williams resigned as a
member of the Board of Directors and the Compensation Committee.
There are no other relationships or transactions involving members of
the Compensation Committee during the fiscal year ended March 1, 1997 required
to be reported pursuant to Item 402(j) of Regulation S-K.
SUMMARY COMPENSATION TABLE
The Summary Compensation Table shows compensation information for each
of the Company's Chief Executive Officers who served as such during the fiscal
year ended March 1, 1997 and each of the four other most highly compensated
executive officers of the Company during the fiscal years ended March 1, 1997,
March 2, 1996 and February 25, 1995.
The Summary Compensation Table appears on page 7.
OPTION/SAR GRANTS IN FISCAL YEAR ENDED MARCH 1, 1997
No option/SAR grants were made for the fiscal year ended March 1, 1997.
AGGREGATED OPTION/SAR EXERCISES IN FISCAL YEAR ENDED MARCH 1, 1997 AND
FISCAL YEAR-END OPTION/SAR VALUES
See page 9.
LONG-TERM INCENTIVE PLANS -- AWARDS IN FISCAL YEAR ENDED MARCH 1, 1997
No Long Term Incentive Plan Awards were made to the CEO and other
named executives in the fiscal year ended March 1, 1997.
-6-
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION AWARDS PAYOUTS
NAME AND PRINCIPAL OTHER RESTRICTED ALL
FISCAL SALARY BONUS ANNUAL STOCK OPTIONS/ LTIP OTHER
POSITION YEAR ($) (1) ($) COMPEN- AWARDS SAR PAYOUTS COMPENSATION
SATION ($) # # ($) ($) (2)
====================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stephen M. Samberg 1997 $518,000 $0 $0 0 0 $0 $1,152
Chairman of the Board, Chief 1996 $522,769 $0 $0 0 0 $0 $4,152
Executive Officer, Treasurer 1995 $500,000 $0 $0 0 75,000 $0 $3,522
and Director
Ronald S. Hoffman 1997 $150,000 $0 $0 0 0 $0 $1,152
Vice President-Finance, Chief 1996 $152,885 $0 $0 0 0 $0 $3,696
Financial Officer, Secretary 1995 $98,000(4) $0 $0 0 30,000(3) $0 $606
and Director
George G. Gold(5) 1997 $0 $0 $0 0 0 $0 $250,061(6)
Director 1996 $0 $0 $0 0 0 $0 $356,730(6)
1995 $0 $0 $0 0 0 $0 $353,527(6)
Donald D. Gold 1997 $0 $0 $0 0 0 $0 $104,061(6)
Director 1996 $0 $0 $0 0 0 $0 $ 89,717(6)
1995 $0 $0 $0 0 0 $0 $ 89,272(6)
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
ANNUAL COMPENSATION AWARDS PAYOUTS
NAME AND PRINCIPAL OTHER RESTRICTED ALL
FISCAL SALARY BONUS ANNUAL STOCK OPTIONS/ LTIP OTHER
POSITION YEAR ($) (1) ($) COMPEN- AWARDS SAR PAYOUTS COMPENSATION
SATION ($) # # ($) ($) (2)
===================================================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Stephen P. Sussman(8) 1997 $144,000 $0 $0 0 0 $0 $1,152
1996 $146,769 $0 $0 0 0 $0 $4,087
1995 $144,000 $0 $0 0 22,500 $0 $3,744
Joseph Visconti 1997 $300,000 $0 $0 0 0 $0 $1,152
President and Director 1996 $ 51,923(9) $0 $0 0 30,000 $0 $0
1995 $0 $0 $0 0 0 $0 $0
</TABLE>
(1) Includes amounts deferred at the election of each of the named executive
officers pursuant to the Company's 401(k) Profit Sharing Plan.
(2) Comprised of 401(k) contributions in fiscal 1996 and 1995 and life insurance
premiums which benefits are payable to the estates of the named executive
officers, except where specifically footnoted as pursuant to the Severance
Agreement. For fiscal 1997, no 401(k) contributions were made and other
compensation reported hereunder was comprised solely of life insurance
premiums.
(3) The options reflected were awarded pursuant to the Company's 1992 Executive
Long-Term Option Plan.
(4) Mr. Hoffman was hired July 1, 1994.
(5) Chairman of the Board, Chief Executive Officer and Treasurer through
March 18, 1994.
(6) Amounts paid pursuant to the Severance Agreement dated as of March 18, 1994
more fully described hereinabove.
(7) Vice Chairman and Secretary through March 18, 1994.
(8) Vice President - Finance through October 10, 1994. Mr. Sussman managed the
Company's production and distribution facility in Cartersville, Georgia. As
of June 1, 1997, Mr. Sussman responsibilities were eliminated but pursuant
to his Employment Agreement, he may continue to provide services to the
Company on a project basis through February 1998, and on a consulting basis
thereafter. See "Employment and Severance Agreements and Change in Control
Arrangements."
(9) Mr. Visconti was hired and became a director effective January 1, 1996.
-8-
<PAGE>
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES(1)
<TABLE>
<CAPTION>
Value of Unexercised
In-The-Money Options/SARs Number of Securities Underlying
Shares at FY-End ($) Acquired Unexercised Options/SARs at FY-End
on Exercisable/ (#) EXERCISABLE/
Exercise (#) UNEXERCISABLE(2) UNEXERCISABLE
NAME VALUE REALIZED ($)
- ---- ------------------
<S> <C> <C> <C>
Stephen M. Samberg 0
$0/$0 $0 30,000/45,000
Ronald S. Hoffman 0
$0/$0 $0 12,000/18,000
George J. Gold 0 $0 0/0
$0/$0
Donald D. Gold 0
$0/$0 $0 0/0
Stephen P. Sussman 0
$0/$0 $0 9,000/13,500
Joseph Visconti 0
$0/$0 $0 6,000/24,000
</TABLE>
(1) There are currently no outstanding stock appreciation rights.
(2) No outstanding options were in the money at the end of fiscal 1997.
-9-
<PAGE>
PERFORMANCE GRAPH
PERFORMANCE GRAPH
In previous years, the Company had presented a graph comparing its
performance (as measured by total return on common stock) to an index of all
companies classified under the Standard Industrial Classification Manual ("SIC")
as manufacturers of men's and boys' furnishings and work clothes (including
underwear). This index was changed in fiscal 1995 to a graph comparing its
performance to that of two indices -- companies classified under the SIC as
manufacturers of men's and boys' underwear and as manufacturers of women's,
misses', children's, and infants' undergarments. In fiscal 1996 the Company
presented a graph comparing its performance to that of one index consisting of a
peer group of six companies classified under the SIC Code 2322 as manufacturers
of men's and boys' underwear and nightwear and one manufacturer of women's and
misses' undergarments under the SIC Code 234. The graph for fiscal 1997 utilizes
the same indices. The Company believes that this peer group of manufacturers
better represents the potential of the Company and provides a more useful
comparison for the stockholders of the Company.
PERFORMANCE GRAPH
The performance graph immediately below shows changes over the past
five-year period in the value of $100 invested in (1) the Company's Common
Stock; (2) the American Stock Exchange market index; and (3) an industry peer
group of six manufacturers of men's and boys' underwear and nightwear, namely:
Fruit of The Loom, Inc., Hampton Industries, Inc., Nautica Enterprises, Inc.,
Oneita Industries, Inc., Sara Lee Corp., and VF Corp. and one manufacturer of
women's and misses' undergarments, Wacoal CP. Investments in this industry group
are based upon the same time periods as the Company. Fiscal year end values are
based on share price appreciation plus dividends, with dividends reinvested on
the date they were paid.
-10-
<PAGE>
COMPARISON OF CUMULATIVE TOTAL RETURN
OF COMPANY, PEER GROUP AND BROAD MARKET
FISCAL YEAR ENDING
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
COMPANY 1992 1993 1994 1995 1996 1997
NANTUCKET INDUSTRIES 100 109.52 41.57 52.38 26.19 22.62
INDUSTRY INDEX 100 115.76 96.23 107.78 133.32 163.36
BROAD MARKET 100 95.37 111.10 101.91 123.40 131.47
</TABLE>
THE PEER GROUP CHOSEN WAS:
Customer Selected Stock List
THE BROAD MARKET INDEX CHOSEN WAS:
AMERICAN STOCK EXCHANGE
THE PEER GROUP IS MADE UP OF THE FOLLOWING SECURITIES:
FRUIT OF THE LOOM INC
HAMPTON INDUSTRIES INC
NANTUCKET INDUSTRIES
NAUTICA ENTERPRISES INC
ONEITA INDUSTRIES INC
SARA LEE CORP
VF CORP
WACOAL CP
EMPLOYMENT AND SEVERANCE AGREEMENTS AND CHANGE IN CONTROL ARRANGEMENTS
As of March 18, 1994, Messrs. George J. Gold and Donald D. Gold (the
"Golds") resigned their positions as executive officers of the Company and
entered into a Severance Agreement with the Company. The Severance Agreement
provides for an annual payment to the Golds of approximately $400,000, in the
aggregate, for each year of the five year term of the Severance Agreement. The
Severance Agreement also provides for the Company to pay them an amount equal to
their life and health insurance benefits and to continue paying one-half of each
of the Golds' share of the annual payments to his spouse in the event of his
death. Pursuant to the Severance Agreement, stock options for 20,000 and 10,000
shares of Common Stock issued to George and Donald Gold, respectively, under the
1992 Long-Term Incentive Stock Option Plan, and bonus awards for maximums of
$123,000 and $61,500 made to George and Donald Gold, respectively, under the
1992 Executive Performance Benefit Plan, were canceled. Further, the Golds
agreed to relinquish their rights to receive ownership of the whole life
insurance policies on their lives described in the previous paragraph.
Under the Severance Agreement, the Company also provided certain benefits
to the Golds in respect of sales of shares of the Company's Common Stock
("Shares") by them during the period September 1, 1994 to August 31, 1996 (the
"Resale Period"). Such benefits provided, in general and subject to certain
limitations, that, for up to 100,000 Shares in the case of George J.
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<PAGE>
Gold and 60,000 Shares in the case of Donald D. Gold, the Company would pay to
the Golds for each Share sold by them for less than $5.00 during the Resale
Period, 80% of the lesser of (a) $1.50 and (b) the difference between the sale
price per Share and $5.00. The Golds sold a total of 157,875 Shares of Common
Stock including 88,400 shares at prices below $5.00 per share. Further, the
Severance Agreement provides for the Company, in general and subject to specific
limitations, to issue as of April 1, 1997, warrants for the purchase of up to
157,875 Shares to the Golds. The number of such warrants to be issued to George
Gold is 93,840 and the number of such warrants to be issued to Donald D. Gold is
64,035, the number of shares sold by each of them during the Resale Period. As
to each of the Golds, the Severance Agreement provides that the aggregate
exercise price for the warrants issued to each of them will equal the aggregate
gross proceeds from his sales of Shares during the Resale Period.
As of March 1, 1994, the Company and Stephen M. Samberg, in connection
with his election as Chairman of the Board and Chief Executive Officer, entered
into a new employment agreement (the "1994 Agreement"). Mr. Samberg's current
annual base compensation is $518,000 and he is entitled to discretionary bonuses
as determined by the Compensation Committee, in an amount not to exceed $300,000
per year. The 1994 Agreement provides that Mr. Samberg is eligible for the
Company's other compensatory plans and that the Company will provide health and
disability insurance for Mr. Samberg and reimburse all reasonable business
expenses. Effective July 1, 1997, the 1994 Agreement was amended and Mr.
Samberg's annual base compensation was reduced to $300,000. The Amendment also
provides for Mr. Samberg to receive commissions equal to 1 1/2% of net sales to
specified customers of the Company's products. The maximum amount of Mr.
Samberg's annual cash compensation is not to exceed $500,000 in any one year.
Mr. Samberg is still entitled to receive discretionary bonuses determined by the
Compensation Committee.
During fiscal 1993, the Company entered into an employment agreement with
Stephen P. Sussman for a term expiring on February 28, 1998. Mr. Sussman has
been advised that effective June 1, 1997 his services are no longer required by
the Company during the balance of the term of the Agreement. Mr. Sussman will
continue to receive his base salary and benefits until February 28, 1998 and
will be available to provide services to the Company on a project basis, as
requested. In addition, until February 28, 1998, any earnings from other sources
received by Mr. Sussman will be credited against the salary payable to him by
the Company. In addition, the Company will be required to retain Mr. Sussman as
a consultant until February 28, 2003 for an annual fee of $40,000.
On July 1, 1994, the Company entered into a one (1) year employment
agreement (extended through June 30, 1997) with Ronald S. Hoffman which provides
for an annual salary of $150,000. As additional contingent compensation, Mr.
Hoffman was granted options to purchase 30,000 shares of Common Stock under the
1992 Executive Long Term Stock Option Plan. The agreement requires the Company
to provide health and life insurance and to reimburse all reasonable business
expenses. Mr. Hoffman's agreement expired on June 30, 1997, and he will continue
to be employed by the Company and serve as an officer and director.
As of January 1, 1996, the Company entered into an Employment Agreement
with Joseph Visconti which provides for an annual salary of $200,000 plus a
bonus for each fiscal year based on increases in sales from those achieved in
fiscal 1996, which bonus in the first fiscal year shall not be less than
$100,000. Effective July 1, 1997, the employment agreement was amended and Mr.
Visconti's annual salary was reduced to $150,000 and his bonus program was
eliminated. In addition to his salary, Mr. Visconti will be entitled to receive
commissions of 1 1/2% on the Company's net sales to specified customers. Mr.
Visconti was granted options to purchase 30,000 shares of Common Stock under the
Stock Option Plan. The agreement requires the Company to provide health and
disability insurance and to reimburse all reasonable business expenses.
-12-
<PAGE>
In addition to delineating the duties and responsibilities of each
executive employee, the employee's salary and certain fringe benefits, and the
circumstances under which employment with the Company may be terminated, the
employment agreements for Stephen M. Samberg and Joseph Visconti, and the
Severance Agreement also contain certain provisions to take effect in the event
of a "Change in Control." A "Change in Control" generally is defined to include
(i) a merger or consolidation involving the Company pursuant to which less than
75% of the outstanding voting securities or other beneficial interest of the
surviving or resulting corporation or other entity is held by the stockholders
of the Company other than those stockholders who acquire beneficial ownership of
20% or more of the Company's outstanding stock after the date of each agreement;
(ii) the transfer to another corporation (other than a wholly owned subsidiary
or a corporation which is at least 75% owned by the Company's stockholders other
than those stockholders who acquire beneficial ownership of 20% or more of the
Company's outstanding stock after the date of each agreement) of substantially
all of the assets of the Company; (iii) the acquisition by any person of the
beneficial ownership of 35% or more of the Company's then outstanding
securities; (iv) a change in the composition of the majority of the Board of
Directors occurring within 24 months of the acquisition by any person of the
beneficial ownership of 10% or more of the Company's then outstanding
securities; or (v) the occurrence of any of the trigger events described in
Sections 11(a)(ii) or 13(a) of the Company's Shareholders Rights Plan.
In the event of any such Change in Control, certain specified benefits
("Termination Benefits") are provided for each such executive employee upon
termination of his employment by the Company other than for cause, or in the
event that he leaves the employ of the Company due to one of the following
events: (i) assignment inconsistent with his current status; (ii) distant
transfer; (iii) default by the Company under the employment agreement or other
agreement with the employee; (iv) failure on the part of the Company to provide
the employee with substantially similar plan benefits to those in which he had
been a participant; or (v) in the case of Messrs. Samberg and Visconti.
inability to effectively discharge his duties due to a Change in Control.
The amount of Termination Benefits payable to Mr. Samberg is determinable
only at the time of termination and is, if such termination is by the Company or
by Mr. Samberg following a default by the Company, in addition to any other
amounts due under his employment agreement. Cash benefits include (x) three
years' base salary (totaling $1,554,000) and (y) three times the average annual
bonus in the preceding three years (or such lesser number of years as have
elapsed since the agreement was made); the sum of (x) and (y) payable in a lump
sum and discounted to present value. Mr. Samberg, after an event giving rise to
Termination Benefits, would also have rights (a) for seven months thereafter, to
exercise or be compensated for any stock options or stock appreciation rights;
and (b) to the immediate vesting of any unvested equity or deferred compensation
rights.
With respect to the Golds, in the event that, following such a Change in
Control, (a) the Company defaults, in an amount greater than $1,000, in its
obligations to pay money to either of the Golds, such of the Golds, in addition
to all other benefits under the Severance Agreement, shall be entitled to a lump
sum payment of twice the annual payment due him, discounted to its then-present
value; or (b) the Company defaults in any other of its obligations to either of
the Golds, such of the Golds shall be entitled to a lump sum, discounted to its
present value, of the greater of (x) twice the annual payment due him, or (y)
the aggregate of the remaining payments due him under the Severance Agreement.
-13-
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of September 8, 1997 the beneficial
share ownership of each director and executive officer owning Common Stock, and
of all officers and directors as a group.
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of
Beneficial Owner Beneficial Ownership Percent of Class(1)
<S> <C> <C>
George J. Gold 452,918(2) 13.98%
209 Sterling Road
Harrison, NY 10528
Donald D. Gold 218,139(2) 6.74%
3670 Paces Ferry Road
Atlanta, GA 30327
Stephen M. Samberg 298,903(3)(6) 8.50%
510 Broadhollow Road
Melville, NY 11747
Robert M. Rosen 9,000(4) *
101 Federal Street
Boston, MA 02110
Warren D. Cole 0 *
142 West 57th Street
New York, NY 10019
Ronald S. Hoffman 273,100(5)(6) 7.80%
510 Broadhollow Road
Melville, NY 11747
Joseph Visconti 6,000 *
510 Broadhollow Road
Melville, NY 11747
Kenneth Klein 0 *
242 E. 72nd. Street
Apt. # 7A
New York, NY 10021
All directors and officers
as a group (9 persons) 1,261,060 35.67%
</TABLE>
*Less than 1%
(1) Pursuant to the rules of the Securities and Exchange Commission,
shares of Common Stock which an individual or member of a group has a
right to acquire within 60 days pursuant to the exercise of options or
warrants are deemed to be outstanding for the purpose of computing the
percentage ownership of such individual or group, but are not deemed to be
outstanding for the purpose of computing the percentage ownership of any
other person shown in the table.
-14-
<PAGE>
Accordingly, where applicable, each individual or group member's rights
to acquire shares pursuant to the exercise of options or warrants are
noted above.
(2) All such shares are subject to the Nantucket Industries Stock
Voting Trust u/i/d March 22, 1994 (the "Voting Trust"). In
addition, the Severance Agreement provides for the Company to
issue, as of April 1, 1997, warrants for the purchase of up to a
total of 157,875 shares to George J. Gold and Donald D. Gold.
(3) Includes 20,303 shares which are subject to the Voting Trust and 30,000
shares that may be issued to Mr. Samberg pursuant to immediately
exercisable stock options.
(4) 5,000 of such shares are owned by the Lane Altman & Owens LLP Profit
Sharing Trust DTD 11/28/92. Lane Altman & Owens LLP, of which Mr. Rosen
is a partner, is general counsel to the Company.
(5) 2,500 of such shares are owned by Mr. Hoffman's wife. Beneficial
ownership of all such shares is disclaimed by Mr. Hoffman and includes
12,000 Shares that may be issued to Mr. Hoffman pursuant to immediately
exercisable stock options.
(6) Includes 248,600 shares representing the number of shares of Common Stock
into which the shares of Non-Voting Convertible Preferred Stock held by
The Samberg Group, L.L.C. may be converted. Messrs. Samberg and Sussman
and Mr. Hoffman's wife, are members thereof, and, as such, would share
dispositive and voting power over such shares. Beneficial ownership of
all such shares is disclaimed by Mr. Hoffman.
(7) Represents 6,000 shares that may be issued to Mr. Visconti pursuant to
immediately exercisable stock options.
In addition, each of the following has reported that it is the
beneficial owner of more than 5% of the outstanding Common Stock of the Company.
<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Beneficial
Beneficial Owner Ownership Percent of Class(1)
<S> <C> <C>
Dimensional Fund Advisors, Inc. 176,765(2) 5.46%
1229 Ocean Avenue
Santa Monica, CA
The Samberg Group, L.L.C. 353,403(3)(5) 9.93%
510 Broadhollow Road
Melville, NY 11747
GUESS?, Inc. 422,835 13.06%
1444 South Alameda Street
Los Angeles, CA 90021
Guess Group(3) 670,500(4) 20.70%
NAN Investors, L.P. 873,370(6) 22.61%
c/o Fundamental Capital Corp.
291 Ocean Avenue
Lawrence, NY 11559
</TABLE>
-15-
<PAGE>
(1) Pursuant to the rules of the Securities and Exchange Commission, shares
of Common Stock which an individual or member of a group has a right to
acquire within 60 days pursuant to the exercise of options or warrants
are deemed to be outstanding for the purpose of computing the
percentage ownership of such individual or group, but are not deemed to
be outstanding for the purpose of computing the percentage ownership of
any other person shown in the table. Accordingly, where applicable,
each individual or group member's rights to acquire shares pursuant to
the exercise of options or warrants are noted above.
(2) Dimensional Fund Advisors, Inc. is an investment advisor registered
under the Investment Advisors Act of 1940. Of this amount, Dimensional
Fund Advisors, Inc., has reported as of January 31, 1995 that it has sole
voting power of 110,230 shares.
(3) The Samberg Group, L.L.C. owns 5,000 shares of the Company's Non-Voting
Convertible Preferred Stock, which is convertible into 248,600 shares of
the Company's Common Stock. Messrs. Samberg, Sussman and Wathen and Mr.
Hoffman's wife are members of The Samberg Group.
(4) The Guess Group comprises Guess ?, Inc. ("GUESS?") and those other
Reporting Persons set forth in the Schedule 13D dated August 26, 1994
reporting the group's purchase from the Company on August 19, 1994 of
490,000 shares of Common Stock.
(5) In accordance with Rule 13d-3(d) of the 1934 Act, assumes the conversion
into 232,000 shares of Common Stock of the Non-Voting Convertible
Preferred Stock held by the Samberg Group, L.L.C.
(6) In accordance with Rule 13d-3(d) of the 1934 Act, assumes the conversion
of the 12.5% Convertible Subordinated Debenture in the original principal
amount of $1,168,150 into 305,000 shares of Common Stock and the
conversion of the Convertible Subordinated Debenture in the original
principal amount of $1,591,850 into 318,370 shares of Common Stock. These
securities were purchased on August 15, 1996 by NAN Investors L.P. A
Schedule 13D dated August 22, 1996 was filed reporting the transaction.
See "Certain Relationships and Related Transactions".
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company, the Golds, Messrs. Samberg, Sussman, Raymond L. Wathen (an
employee of the Company), Robert Polen (a former employee of the Company), and
The Samberg Group, L.L.C., a limited liability company organized in Delaware,
entered into a Management Agreement as of March 1, 1994, pursuant to which the
Company on March 22, 1994 sold 5,000 shares of Non-Voting Convertible Preferred
Stock to The Samberg Group for $1,000,000. Such preferred stock and accrued and
unpaid cumulative dividends on such preferred stock are convertible into shares
of the Company's Common Stock at the rate of $5.00 per share. Messrs. Samberg,
Sussman, Wathen and Polen and Mr. Hoffman's wife are each members of The
Samberg Group.
The Management Agreement also provides that The Samberg Group, Messrs.
Samberg, Sussman, Wathen and Polen and the Golds will deposit all their Common
Stock into a voting trust. The voting of the shares deposited in said voting
trust is controlled by the terms of the trust instrument. Mr. Rosen serves as
the trustee of said voting trust.
The Management Agreement further provides for the cancellation of all
outstanding stock options and incentive awards granted prior to the date thereof
to the Golds and Messrs. Samberg, Sussman, Wathen and Polen and the issuance of
stock options for 150,000 shares of Common
-16-
<PAGE>
Stock in the aggregate to Messrs. Samberg, Sussman, Wathen and Polen upon terms
and conditions determined by the Compensation Committee.
Pursuant to the Management Agreement, the Severance Agreement described
above was entered into by the Golds and the Company and the 1995 Agreement
described above was entered into by Mr. Samberg and the Company.
On August 19, 1994, the Guess Group bought 490,000 shares of Common
Stock pursuant to a Common Stock Purchase Agreement dated August 18, 1994 by and
among the Company, the Guess Group and the Samberg Group (the "Guess
Agreement"). Consideration paid was $6.00 in cash per share of Common Stock. All
shares sold were previously held by the Company as treasury stock.
The Guess Agreement provides the Guess Group with certain registration
rights and, with respect to the issuance of additional stock by the Company,
certain rights to purchase additional shares. The Agreement also provides
certain restrictions on the ability of the Guess Group to acquire additional
voting stock of the Company, to dispose of its Common Stock and to engage in
control transactions or proxy solicitations with respect to the Company.
The Guess Group had designated Roger A. Williams, who until his recent
resignation was the Executive Vice President and Chief Financial Officer of
GUESS?, to serve as a director of the Company, and he had been so serving as a
member of the Board of Directors and its Compensation Committee until his
resignation on July 21, 1997. The Guess Agreement requires the Company and the
Samberg Group to each use its best efforts to cause one individual designated
collectively by the Guess Group to be elected a director of the Company at
future annual meetings of the Company so long as the Guess Group and their
affiliates beneficially own in the aggregate at least the lesser of 490,000
shares of Common Stock or 15% of the outstanding Common Stock. The Guess Group
has not designated an individual to replace Mr. Williams as a director.
As a condition to the Guess Agreement, the Company amended its Rights
Agreement so that the Guess Group's acquisition of Common Stock would not
trigger any defensive measures thereunder. Provisions were made in each
executive officer's employment agreement and the Severance Agreement so that
such acquisition would not be a "Change in Control" under those agreements.
The Company is licensed by GUESS? to manufacture and sell certain
garments under the GUESS? trademarks. Effective May 31, 1996, the License was
extended though the period ended May 31, 1999. For the contract year ending May
31, 1997, minimum sales of $8 million were required and the Company informed
GUESS? that it would not achieve such minimum net sales. GUESS? agreed not to
terminate the license agreement as of May 31, 1997 and the Company has agreed
that GUESS?, in its sole and subjective discretion, may terminate the license
agreement at any time after December 31, 1997. For each contract year ending in
May thereafter, the minimum sales goal increases by $2,000,000. Minimum
royalties are $560,000, $700,000 and $840,000 for the contract years ended May
31, 1997, 1998 and 1999, respectively. In fiscal 1997, such license fees were in
the amount of $294,000.
On August 15, 1996, pursuant to a Common Stock and Convertible
Subordinated Debenture Purchase Agreement dated as of August 13, 1996 (the
"Purchase Agreement") between the Company and NAN Investors, L.P. (the
"Investor"), the Company sold to the Investor 250,000 shares of Common Stock for
an aggregate purchase price of $740,000, and two (2) 12.5% convertible
subordinated debentures of the Company in the original principal amounts of
$1,168,150 and $1,591,850, respectively, which debentures are convertible into
305,000 and 318,370 additional shares ("Conversion Shares") of Common Stock. All
shares sold and all Conversion Shares to be issued are authorized and unissued
shares of Common Stock reserved for issuance pursuant to the Purchase Agreement.
The debentures mature on August 15, 2001.
-17-
<PAGE>
The Purchase Agreement provides the Investor with certain registration
rights. Pursuant to the exercise of certain rights, the Company filed a
Registration Statement covering the registration of the 250,000 shares sold to
the Investor and the Conversion shares which was declared effective by the
Securities and Exchange Commission on April 11, 1997. The Purchase Agreement
also requires the Company and The Samberg Group to each use its best efforts to
cause Kenneth Klein to be elected as a director of the Company at future annual
meetings of the Company so long as the Investor and its affiliates beneficially
own in the aggregate at least the lesser of 250,000 shares of Common Stock or 7%
of the outstanding Common Stock. The Company has been advised that Mr. Klein is
not an affiliate of the Investor.
Provisions were made in each executive officer's employment agreement
and the Severance Agreement so that the Investor's acquisition would not be a
"Change in Control" under those agreements. Additional relationships and related
transactions are described above, under the caption "Compensation Committee
Interlocks and Insider Participation."
I. VOTING REQUIRED, RECOMMENDATIONS OF
THE BOARD OF DIRECTORS
The three candidates receiving the highest numbers of "for" votes shall
be elected to the Company's Board of Directors. An abstention shall have the
same effect as a vote withheld for the election of directors, and, pursuant to
Delaware law, a broker non-vote will not be treated as voting in person or by
proxy on any proposal. The affirmative vote of a majority of the shares
represented, in person or by proxy, and voting at the Special Meeting (which
shares voting affirmatively also constitute at least a majority of the required
quorum) is required to set the number of directors constituting the Board of
Directors at nine.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" SETTING THE NUMBER OF
DIRECTORS CONSTITUTING THE BOARD OF DIRECTORS
AT NINE AND THE ELECTION OF THE
NOMINEES AS CLASS I DIRECTORS.
II. SELECTION OF AUDITORS
The Board of Directors, acting upon the recommendation of the Audit
Committee, has appointed, subject to ratification by the stockholders, the firm
of Grant Thornton LLP, independent certified public accountants, to audit the
consolidated financial statements of the Company and its subsidiaries for fiscal
1998. Representatives of Grant Thornton, the Company's independent certified
public accountants, are expected to be present at the meeting with the
opportunity to make a statement if they desire to do so and to answer questions
from stockholders which are submitted in writing prior to the commencement of
the meeting.
The affirmative vote of a majority of the shares represented, in person
or by proxy, and voting at the Special Meeting (which shares voting
affirmatively also constitute at least a majority of the required quorum) is
required to ratify the Board of Directors' selection. If the stockholders reject
the nomination the Board of Directors will reconsider its selection.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE
APPOINTMENT OF GRANT THORNTON LLP AS INDEPENDENT AUDITORS OF THE COMPANY FOR
FISCAL 1998.
-18-
<PAGE>
III. STOCKHOLDER PROPOSALS AND OTHER MATTERS
Stockholder proposals intended for inclusion in the proxy material
relating to the 1998 meeting of stockholders must be received by the Company at
its principal offices not later than March 1, 1998.
STOCKHOLDERS OR BENEFICIAL OWNERS OF THE COMPANY'S COMMON STOCK MAY
OBTAIN A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
MARCH 1, 1997, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. A COPY OF
THAT REPORT, INCLUDING FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES,
MAY BE OBTAINED WITHOUT CHARGE BY DIRECTING A REQUEST THEREFOR TO RONALD S.
HOFFMAN, CHIEF FINANCIAL OFFICER, NANTUCKET INDUSTRIES, INC., 510 BROADHOLLOW
ROAD, MELVILLE, NEW YORK 11747.
The Board of Directors has no knowledge of any other matters which may
come before the meeting and does not intend to present any other matter. If any
such other matter should properly be brought before the meeting or any
adjournment or adjournments thereof, however, the persons named as proxies will
have discretionary authority to vote the shares represented by the accompanying
proxy in accordance with their own judgment.
-19-
<PAGE>
NANTUCKET INDUSTRIES, INC.
Dear Shareholder:
Please take note of the important information enclosed with the Proxy Ballot.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Please mark the boxes on the Proxy Ballot to indicate how your shares should be
voted. Then sign and date the Ballot, detach it and return it in the enclosed
postage paid envelope.
Your proxy must be received prior to the Special Meeting in Lieu of Annual
Meeting of Stockholders on October 22, 1997.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Nantucket Industries, Inc.
<PAGE>
<TABLE>
<CAPTION>
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED>
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C>
NANTUCKET INDUSTRIES, INC.
PROXY BALLOT
PROXY FOR THE SPECIAL MEETING IN LIEU OF
ANNUAL MEETING OF STOCKHOLDERS, OCTOBER 22,1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoints ROBERT M. ROSEN and RONALD S. HOFFMAN, as Proxies, each with the power to appoint his
substitute, and hereby authorizes them to represent and to vote as designated on the reverse all the shares of common stock of
Nantucket Industries, Inc. held of record by the undersigned on September 8, 1997, at the Special Meeting in Lieu of Annual
Meeting of Stockholders to be held at 180 Madison Avenue, 14th Floor, New York, New York on October 22, 1997 at 11:00 a.m., and
at any adjournment thereof.
-----------------------------------------------------------------------------------------------------------
PLEASE VOTE, DATE, AND SIGN ON OTHER SIDE AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.
-----------------------------------------------------------------------------------------------------------
Please sign this proxy exactly as your name appears on the books of the Company. Joint owners should each sign personally.
Trustees and other fiduciaries should indicate the capacity in which they sign, and where more than one name appears, a majority
must sign. If a corporation, this signature should be that of an authorized officer who should state his or her title.
- --------------------------------------------------------------------------------------------------------------------------------
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
- ----------------------------------------- -----------------------------------------
- ----------------------------------------- -----------------------------------------
- ----------------------------------------- -----------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PLEASE DETACH AND MAIL IN THE ENVELOPE PROVIDED
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
A /X/ PLEASE MARK YOUR
VOTES AS INDICATED
IN THIS EXAMPLE.
FOR ALL
(except as
indicated to the
contrary below)
WITHHOLD FOR AGAINST ABSTAIN
1) To set the num- / / / / NOMINEES: Stephen M. Samberg 2) To ratify the appointment / / / / / /
ber of directors Robert M. Rosen of Grant Thornton LLP, certified public
constituting the Warren D. Cole accountants, to audit the consolidated financial
Board of Directors at nine and to elect as directors statements of the company and its subsidiaries for
the following persons: fiscal 1998.
3) In their discretion, the Proxies are authorized to
vote upon such other business as may properly come
before the meeting.
If you do not wish your shares voted "FOR" a particular This proxy may be revoked at any time before it is exercised.
nominee, mark the "For" box and strike a line through Mark box at right if comments or address change has been noted
that nominee's name. Your shares will be voted for the on the reverse side of this card.
remaining nominee.
Shareholder sign here ________________________________________________ Co-owner sign here_____________________ Date______________
IMPORTANT: Please be sure to sign and date this proxy.
</TABLE>
