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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 [ ]
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Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
DESIGNS,INC
(Name of Registrant as Specified In Its Charter)
DESIGNS, INC
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
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[DESIGNS LETTERHEAD]
September 23, 1999
Dear Fellow Stockholder:
YOUR VOTE IS IMPORTANT
RETURN THE BLUE PROXY TODAY
We must send Holtzman a clear message to stop his repeated efforts to take
control of your Company. Regardless of how many shares you own, YOUR VOTE IS
VERY IMPORTANT. If you have not already done so, your Board of Directors urges
you to return today the enclosed BLUE proxy card. If your shares are held in
street name, contact your broker or bank and make sure that they complete a BLUE
proxy card on your behalf.
HOLTZMAN HAS OFFERED NOTHING BUT UNNECESSARY COSTS
AND THE DESTRUCTION OF THE LEVI STRAUSS RELATIONSHIP
Holtzman engaged in an unsuccessful effort to replace your Board of
Directors beginning in December 1998, and ending in February 1999. The cost of
preserving your Company from this attack was high, both in terms of dollars and
management time.
Thereafter, he claimed that he had the desire and the financing to
purchase the Company for $3.65 per share. Management spent valuable time and
dollars responding to his requests for information and to his unfounded
accusations relating to the sale process. He then abandoned his purchase
proposal. Did he not have the financing that he claimed he could obtain? Did he
not have a real desire to purchase the Company? Was he really on a fishing
expedition for his next proxy contest?
Holtzman refused to accept the stockholders' verdict in February 1999.
This new attempt to replace your Board of Directors is unnecessarily costing the
Company significant financial and managerial resources.
What does Holtzman offer?
1. HOLTZMAN OFFERS THE PROBABLE DESTRUCTION OF THE COMPANY'S CRITICAL
RELATIONSHIP WITH LEVI STRAUSS.
Levi Strauss states that it has the right to terminate our Trademark
License Agreement if Holtzman's slate takes control. Levi Strauss says that it
is "unlikely that Jewelcor will establish a productive relationship with Levi
Strauss" if Jewelcor wins the proxy contest.
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2. HOLTZMAN OFFERS THE POSSIBILITY THAT HE WILL BUY THE COMPANY ON THE CHEAP
WITH NO APPROPRIATE PREMIUM TO ALL STOCKHOLDERS.
His idea of using your Company's money to buy back stock would allow him
to significantly increase his percentage ownership at your expense. After
terminating the stockholder rights plan, he would be in a position to acquire
more Company stock and take control of the Company without paying an appropriate
premium to all stockholders.
3. HOLTZMAN OFFERS NO IDEAS WHATSOEVER FOR CHANGING THE BASIC OPERATING
STRATEGY OF THE COMPANY.
The strategy of your team is working in 1999. We are focusing on the
profitable and growing chain of Levi's(R) and Dockers(R) outlets. At these
outlets: TOTAL SALES ARE UP, TOTAL PROFITS ARE UP. Holtzman offers no
suggestions for a change in our direction.
Holtzman needs to receive the clear message to stop trying to take control
of your company. Please return the enclosed BLUE card today.
WE RESPECTFULLY REQUEST THAT YOU NOT RETURN THE WHITE PROXY CARD SENT TO
YOU BY HOLTZMAN AND JEWELCOR. IF YOU HAVE PREVIOUSLY RETURNED A WHITE CARD, EVEN
TO WITHHOLD AUTHORITY TO VOTE, PLEASE SIGN AND RETURN THE ENCLOSED BLUE CARD
TODAY. IF YOUR SHARES ARE HELD IN THE NAME OF A BANK OR BROKERAGE FIRM, ONLY
THAT FIRM CAN EXECUTE A PROXY CARD ON YOUR BEHALF. PLEASE CONTACT THE PERSON
RESPONSIBLE FOR YOUR ACCOUNT AND GIVE INSTRUCTIONS FOR COMPLETING A BLUE PROXY
CARD.
Sincerely,
James G. Groninger
Chairman of the Special Committee
IF YOU HAVE ANY QUESTIONS OR NEED ANY ASSISTANCE, PLEASE CALL INNISFREE M&A
INCORPORATED TOLL-FREE AT (888) 750-5834. BANKS AND BROKERS CALL COLLECT TO
(212) 750-5833
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[DESIGNS LETTERHEAD]
September 20, 1999
Dear Fellow Stockholder:
WHAT CAN HOLTZMAN'S SLATE OF DIRECTORS POSSIBLY ADD TO YOUR COMPANY? WE
THINK THE ANSWER IS CLEAR - ABSOLUTELY NOTHING. And worse, Holtzman offers the
very substantial risk of THE LOSS OF THE LEVI STRAUSS RELATIONSHIP. Look at
Holtzman's claims, and then look behind them.
HOLTZMAN CLAIMS his slate can work effectively with Levi Strauss.
BUT CONSIDER THIS
Levi Strauss, which supplies more than 97% of the Company's products,
has clearly stated:
- - It has the right to terminate its Trademark License Agreement with
Designs if Holtzman's slate takes control.
- - It is "UNLIKELY THAT JEWELCOR WILL ESTABLISH A PRODUCTIVE RELATIONSHIP
WITH LEVI STRAUSS."
HOLTZMAN CLAIMS that in the first half of 1999 he wanted to purchase the Company
for $3.65 per share.
BUT CONSIDER THIS
- - The Company gave Holtzman an enormous amount of information to help
him in the process.
- - Holtzman walked away from his $3.65 per share bid.
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- - Holtzman has not indicated any interest in purchasing the Company if
his slate of directors is elected.
- - Was his real motive a fishing expedition to gain information for a
proxy contest?
HOLTZMAN CLAIMS that he wants the Company to buy back one-third of its
outstanding stock and remove its rights plan.
BUT CONSIDER THIS
- - He would be using your Company's money to increase his percentage owner
ship of the Company and would be in a position to acquire more Company
stock on the cheap. Indeed, given Levi Strauss' position relating to
Holtzman's attempted takeover, the price could end up being very cheap.
HOLTZMAN CLAIMS that he is confident that he can find financing for the
Company's operating needs and for a large stock buy-back program.
BUT CONSIDER THIS
- - WHO WILL LEND TO THE COMPANY IN THE FACE OF LEVI STRAUSS' POSITION
RELATING TO HOLTZMAN'S ATTEMPTED TAKEOVER OF YOUR COMPANY?
- - Holtzman's operation of Jewelcor Incorporated ended in a bankruptcy
filing. What impact would this have on a lender's decision to lend
money to a Holtzman-controlled Designs?
- - BankBoston, the Company's principal lender, litigated with Jewelcor
Inc. and lost millions in the Jewelcor Inc. bankruptcy. How long would
BankBoston be the lender to a Holtzman-controlled Designs?
What is most important to our stockholders is for the Company to
effectively implement a strategy that will produce sustainable growth in
profits. Holtzman offers no alternative whatsoever to our current operating
strategy except to look for ways to reduce overhead.
We have already reduced overhead by 27% since 1997, and management
continues to examine ways to responsibly reduce overhead. Results through August
of this year show that our strategy is working.
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ALL THAT HOLTZMAN OFFERS YOUR COMPANY IS THE LIKELIHOOD OF DESTROYING
ITS CRITICAL RELATIONSHIP WITH LEVI STRAUSS. We urge you to preserve your
Company by completing and returning the enclosed BLUE proxy card.
Sincerely,
James G. Groninger
Chairman of the Special Committee
IF YOUR SHARES ARE HELD IN THE NAME OF A BANK OR BROKERAGE FIRM, ONLY THAT FIRM
CAN EXECUTE A PROXY CARD ON YOUR BEHALF. PLEASE CONTACT THE PERSON RESPONSIBLE
FOR YOUR ACCOUNT AND GIVE INSTRUCTIONS FOR COMPLETING A BLUE PROXY CARD.
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