<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14a INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
The Men's Wearhouse, 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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<PAGE> 2
THE MEN'S WEARHOUSE, INC.
5803 GLENMONT DRIVE
HOUSTON, TEXAS 77081-1701
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JULY 1, 1999
Notice is hereby given that the Annual Meeting of the Shareholders of The
Men's Wearhouse, Inc., a Texas corporation (the "Company"), will be held at 4:00
p.m., central daylight time, on Thursday, July 1, 1999, at The Houstonian Hotel,
111 N. Post Oak Lane, Houston, Texas, for the following purposes:
(1) To elect ten directors of the Company to hold office until the
next Annual Meeting of Shareholders or until their respective successors
are duly elected and qualified;
(2) To approve an amendment to the Company's Restated Articles of
Incorporation that would increase the number of authorized shares of the
Company's common stock, $.01 par value, from 50,000,000 shares to
100,000,000 shares;
(3) To ratify the appointment by the Board of Directors of the firm of
Deloitte & Touche LLP as independent auditors for the Company for 1999; and
(4) To transact such other business as may properly come before the
meeting or any adjournment thereof.
The holders of record of the Company's common stock, $.01 par value, and
the holder of record of the Company's one share of Series A Special Voting
Preferred Stock at the close of business on May 11, 1999, will be entitled to
vote at the meeting and any adjournment(s) thereof.
By Order of the Board of Directors
/s/ MICHAEL W. CONLON
Michael W. Conlon
Secretary
June 2, 1999
IMPORTANT
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON. EVEN IF YOU PLAN
TO BE PRESENT, YOU ARE URGED TO SIGN, DATE AND MAIL THE ENCLOSED PROXY PROMPTLY.
IF YOU ATTEND THE MEETING YOU CAN VOTE EITHER IN PERSON OR BY YOUR PROXY.
<PAGE> 3
THE MEN'S WEARHOUSE, INC.
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JULY 1, 1999
This proxy statement is furnished to the shareholders of The Men's
Wearhouse, Inc. (the "Company"), whose principal executive offices are located
at 5803 Glenmont Drive, Houston, Texas 77081-1701, and at 40650 Encyclopedia
Circle, Fremont, California 94538-2453, in connection with the solicitation by
the Board of Directors of the Company of proxies to be used at the Annual
Meeting of Shareholders to be held at 4:00 p.m., on Thursday, July 1, 1999, at
The Houstonian Hotel, 111 N. Post Oak Lane, Houston, Texas, or any
adjournment(s) thereof (the "Annual Meeting").
Proxies in the form enclosed, properly executed by shareholders and
received in time for the meeting, will be voted as specified therein. If a
shareholder does not specify otherwise, the shares represented by his or her
proxy will be voted "FOR" the nominees for director listed therein, "FOR" the
proposal to amend the Company's Restated Articles of Incorporation to increase
the number of authorized shares of the Company's common stock, $.01 par value
("Common Stock"), from 50,000,000 shares to 100,000,000 shares and "FOR"
ratification of the appointment of the Company's independent auditors. The
giving of a proxy does not preclude the right to vote in person should the
person giving the proxy so desire, and the proxy may be revoked at any time
before it is exercised by written notice delivered to the Company at or prior to
the meeting.
This Proxy Statement is being mailed on or about June 2, 1999, to the
holders of record of the Company's Common Stock and the holder of record of the
Company's one share of Series A Special Voting Preferred Stock ("Series A
Preferred Stock") on May 11, 1999 (the "Record Date"). At the close of business
on the Record Date, there were outstanding and entitled to vote 35,084,158
shares of Common Stock, and only the holders of record on such date shall be
entitled to vote at the Annual Meeting. Such holders will be entitled to one
vote per share on each matter presented at the Annual Meeting. As of the Record
Date, the one share of Series A Preferred Stock is entitled to an aggregate of
2,375,579 votes and votes together with the Common Stock as a single class.
Accordingly, the Common Stock and the Series A Preferred Stock constitute a
class with an aggregate of 37,459,737 votes (the "Aggregate Vote"). The trustee
who holds the share of Series A Preferred Stock must vote such share in
accordance with instructions from the holders of the Exchangeable Shares
("Exchangeable Shares") issued by Moores Retail Group Inc. ("Moores").
The enclosed form of proxy provides a means for shareholders to vote for
all of the nominees listed therein, to withhold authority to vote for one or
more of such nominees or to withhold authority to vote for all of such nominees.
The withholding of authority by a shareholder will have no effect on the results
of the election of those directors for whom authority to vote is withheld
because the Company's bylaws provide that directors are elected by a plurality
of the votes cast.
The affirmative vote of the holders of a majority of the Aggregate Vote
represented in person or by proxy at the Annual Meeting is required to approve
the proposal to ratify the appointment of the Company's independent auditors,
and the affirmative vote of the holders of at least two-thirds of the Aggregate
Vote is required to approve the proposal to amend the Company's Restated
Articles of Incorporation to increase the number of authorized shares of the
Company's Common Stock from 50,000,000 shares to 100,000,000 shares.
The holders of a majority of the Aggregate Vote, whether present in person
or represented by proxy, will constitute a quorum for the transaction of
business at the Annual Meeting. Abstentions are counted toward the calculation
of a quorum, but are not treated as either a vote for or against a proposal. An
abstention has the same effect as a vote against a proposal or, in the case of
the election of directors or the proposal to amend the Company's Restated
Articles of Incorporation, as shares to which voting power has been withheld.
Under Texas law, any unvoted position in a brokerage account with respect to any
matter will be considered as not voted and will not be counted toward
fulfillment of quorum requirements as to that matter. The shares held by each
shareholder who signs and returns the enclosed form of proxy will be counted for
purposes of determining the presence of a quorum at the meeting.
<PAGE> 4
ELECTION OF DIRECTORS
At the Annual Meeting, ten directors constituting the entire Board of
Directors are to be elected. All directors of the Company hold office until the
next annual meeting of shareholders or until their respective successors are
elected and qualified or their earlier resignation or removal.
The following persons have been nominated to fill the ten positions to be
elected by the shareholders. It is the intention of the persons named in the
enclosed proxy to vote the proxies for the election of the nominees named below,
unless otherwise specified. Management of the Company does not contemplate that
any of the nominees will become unavailable for any reason, but if that should
occur before the meeting, proxies will be voted for another nominee, or other
nominees, to be selected by management.
<TABLE>
<CAPTION>
DIRECTOR
NAME AGE POSITION WITH THE COMPANY SINCE
---- --- ------------------------- --------
<S> <C> <C> <C>
George Zimmer.......... 50 Chairman of the Board and Chief Executive Officer 1974
David Edwab............ 44 President and Director 1991
Richard E. Goldman..... 48 Executive Vice President and Director 1975
Harry M. Levy.......... 50 Executive Vice President -- Planning and Systems 1991
and Director
Robert E. Zimmer....... 75 Senior Vice President -- Real Estate and Director 1974
James E. Zimmer........ 47 Senior Vice President -- Merchandising and 1975
Director
Stephen H. Greenspan... 58 Chief Executive Officer -- Value Priced Clothing 1999
Division and Director
Rinaldo Brutoco........ 52 Director 1992
Michael L. Ray......... 60 Director 1992
Sheldon I. Stein....... 45 Director 1995
</TABLE>
George Zimmer, together with Robert E. Zimmer and Harry M. Levy, founded
The Men's Wearhouse as a partnership in 1973 and has served as Chairman of the
Board of the Company since its incorporation in 1974. George Zimmer served as
President from 1974 until February 1997 and has served as Chief Executive
Officer of the Company since 1991.
David Edwab joined the Company in February 1991 and was elected Senior Vice
President, Treasurer and Chief Financial Officer of the Company. In February
1993, he was elected Chief Operating Officer of the Company. In February 1997,
Mr. Edwab was elected President of the Company. He was elected a director of the
Company in 1991.
Richard E. Goldman joined The Men's Wearhouse in 1973 shortly after its
inception and has served as Executive Vice President and a director of the
Company since 1975. Mr. Goldman is responsible for the overall marketing and
advertising for the Company.
Harry M. Levy served as a Vice President of the Company from December 1979
to February 1992, at which time he was elected Senior Vice President and Chief
Information Officer of the Company. In May 1998, Mr. Levy was named Executive
Vice President. He was elected a director of the Company in November 1991.
Robert E. Zimmer has served as Senior Vice President and a director of the
Company since its incorporation in 1974 and is primarily responsible for new
store site selection and arrangements.
James E. Zimmer has served as Senior Vice President and a director of the
Company since 1975 and works primarily with the Chief Operating Officer in
coordinating the Company's merchandising function.
Stephen H. Greenspan joined the Company in June 1999 and was appointed the
Chief Executive Officer -- Value Priced Clothing Division and a director of the
Company following the closing of the merger (the "K&G Merger") of a wholly owned
subsidiary of the Company with K&G Men's Center, Inc. ("K&G") on June 1, 1999.
Mr. Greenspan founded K&G in December 1989, and served as the Chairman of the
Board, President and Chief Executive Officer of K&G since its incorporation.
Pursuant to the terms of the K&G
2
<PAGE> 5
Merger, the Company agreed that the Board of Directors of the Company would
increase its number of directors by one and elect Mr. Greenspan to serve as a
director. In addition, the Company agreed that the Board of Directors of the
Company would include Mr. Greenspan in its nominees for election at this Annual
Meeting of Shareholders of the Company.
Rinaldo Brutoco is and has been since 1981, President and Chief Executive
Officer of Dorason Corporation, a privately held consulting and merchant banking
concern. In addition, through October 1998, Mr. Brutoco served as the Chief
Executive Officer and a director of Red Rose Collection, Inc., a San
Francisco-based mail order catalog and retail company.
Michael L. Ray has been on the faculty at Stanford University since 1967
and is currently the John G. McCoy -- Banc One Corporation Professor of
Creativity and Innovation and of Marketing at Stanford University's Graduate
School of Business. Professor Ray is a social psychologist with training and
extensive experience in advertising and marketing management and has served as a
private consultant to numerous companies since 1967. He is also a director of
Gardenburger, Inc.
Sheldon I. Stein is a Senior Managing Director of Bear, Stearns & Co. Inc.
("Bear Stearns") and oversees its United States regional investment banking
offices. Mr. Stein joined Bear Stearns in August 1986. He is a director of
CellStar Corporation, Home Interiors & Gifts, Inc., Fresh America Corp., Precept
Business Services, Inc. and Tandycrafts, Inc.
George Zimmer and James E. Zimmer are brothers, and Robert E. Zimmer is
their father.
COMMITTEES OF THE BOARD OF DIRECTORS AND MEETING ATTENDANCE
During the fiscal year ended January 30, 1999, the Board of Directors held
seven meetings.
The Board of Directors has an audit committee that is comprised of Messrs.
Stein (Chairman), Brutoco and Ray. It is the duty of the audit committee to
review the Company's financial information and internal controls, review with
the Company's independent public accountants the plan, scope and results of the
annual audit of the Company's financial statements, and to make recommendations
to the Board of Directors as to the selection of independent public accountants.
During the fiscal year ended January 30, 1999, the audit committee held one
meeting.
The Company has a compensation committee comprised solely of non-employee
directors, Messrs. Stein (Chairman) and Ray. It is the duty of the compensation
committee to consider and approve, on behalf of the Board of Directors,
adjustments to the compensation of the executive officers of the Company and the
implementation of any compensation program for the benefit of any executive
officer of the Company. During the fiscal year ended January 30, 1999, the
compensation committee held one meeting.
During the fiscal year ended January 30, 1999, no director attended fewer
than 75% of all of the meetings of the Board of Directors and of any committee
of which such director was a member, except for Michael L. Ray who attended six
of nine meetings.
The Board of Directors has no executive or nominating committee. Director
nominees are determined by the Board of Directors, and nominees proposed by
shareholders will not be considered.
3
<PAGE> 6
APPROVAL OF AMENDMENT TO THE
RESTATED ARTICLES OF INCORPORATION
TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
The Board of Directors has recommended the adoption of an amendment to the
Company's Restated Articles of Incorporation that will increase the authorized
shares of Common Stock from 50,000,000 shares to 100,000,000 shares. Of the
50,000,000 shares of Common Stock currently authorized, at the Record Date there
were 35,084,158 shares of Common Stock outstanding. In addition, an aggregate of
11,029,344 shares of Common Stock are reserved for future issuance, of which (i)
642,262 shares are reserved for issuance upon the exercise of options granted
under the The Men's Wearhouse, Inc. 1992 Stock Option Plan, (ii) 1,098,129
shares are reserved for issuance upon the exercise of options granted under the
The Men's Wearhouse's, Inc. 1996 Stock Option Plan, (iii) 745,425 shares are
reserved for issuance upon the exercise of options granted under the The Men's
Wearhouse, Inc. 1998 Key Employee Stock Option Plan, (iv) 1,393,449 shares are
reserved for issuance under the The Men's Wearhouse, Inc. Employee Stock
Discount Plan, (v) 67,500 shares are reserved for issuance upon the exercise of
options granted under the The Men's Wearhouse, Inc. Non-Employee Director Stock
Option Plan, (vi) 57,000 shares are reserved for issuance upon the exercise of
options granted under miscellaneous employee stock option agreements, (vii)
2,375,579 shares are reserved for issuance upon the exchange of Exchangeable
Shares issued by Moores and (viii) 4,650,000 shares are reserved for issuance
upon completion of the merger with K&G Men's Center, Inc. This leaves a total of
3,886,498 shares of Common Stock authorized and available for future issuances
for corporate purposes, including acquisitions and employee benefit plans.
The purpose of the amendment to increase the authorized number of shares of
Common Stock is to provide the Company with greater flexibility in effecting
acquisitions and financings, as well as assuring that the Company has shares of
Common Stock available for future employee benefit plans and arrangements. The
Company expects that future growth of the Company may require the use of its
Common Stock from time to time either as consideration for acquisitions or as
part of a financing for the Company either through the use of Common Stock or
securities convertible into Common Stock. The proposed amendment would provide
the Company with additional flexibility to effect these acquisitions and
financings without the delay and expense associated with obtaining the approval
or consent of shareholders at the same time the shares are needed. Such shares
may be issued in conjunction with either a public offering or a private
placement of shares of Common Stock.
The increase in the authorized number of shares of Common Stock will be
effected through an amendment to the first paragraph of Article Four of the
Company's Restated Articles of Incorporation. As amended, such paragraph would
read as follows:
"The total number of shares of all classes of stock that the corporation
shall be authorized to issue is 102,000,000, comprising 2,000,000 shares of
preferred stock, of the par value of $.01 per share (hereinafter called
"Preferred Stock"), and 100,000,000 shares of common stock, of the par
value of $.01 per share (hereinafter called "Common Stock")."
The Company does not have any current plans, proposals or understandings
that would require the use of the additional shares of Common Stock to be
authorized. The Company, however, anticipates that some portion of the
additional shares would be utilized by the Company in the future for
acquisitions as well as for public offerings of Common Stock or securities
convertible or exchangeable into shares of Common Stock. Such shares would also
be used for the Company's stock based benefit or compensation plans. Unless
required by law, regulatory authorities or applicable rules of the Nasdaq
National Market System, it is not anticipated that any future authorization by a
vote of shareholders will be sought for the issuance of any shares of Common
Stock. Shareholders of the Company do not have any preemptive rights to purchase
additional shares of Common Stock, whether now or hereafter authorized.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE AMENDMENT TO
THE RESTATED ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED
SHARES OF COMMON STOCK.
4
<PAGE> 7
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information, as of the Record Date, except
as noted in notes (1)-(2) below, with respect to the beneficial ownership of
Common Stock by (i) each director, which includes each executive officer named
in the Summary Compensation Table below, (ii) each shareholder known by the
Company to be the beneficial owner of more than 5% of the Common Stock and (iii)
all executive officers and directors of the Company as a group. Unless otherwise
indicated, each person has sole voting power and investment power with respect
to the shares attributed to him or her.
<TABLE>
<CAPTION>
% OF
NUMBER OUTSTANDING
NAME OF SHARES SHARES
---- --------- -----------
<S> <C> <C>
AMVESCAP PLC................................................ 3,504,337(1) 10.5
11 Devonshire Square
London, England EC2M 4YR
-or-
1315 Peachtree Street, N.E.
Atlanta, Georgia 30309
State Street Research & Management Company.................. 1,889,874(2) 5.1
One Financial Center, 30th Floor
Boston, Massachusetts 02111-2690
George Zimmer(3)............................................ 4,141,542(4)(5)(14) 11.0(15)
Robert E. Zimmer............................................ 1,331,034(5)(6)(14) 3.5(15)
Richard E. Goldman(3)....................................... 1,973,243(14) 5.2(15)
James E. Zimmer............................................. 1,157,682(5)(7)(14) 3.1(15)
David Edwab................................................. 94,062(5)(8)(14) *(15)
Harry M. Levy............................................... 112,511(9)(14) *(15)
Stephen H. Greenspan........................................ 0(10) *(15)
Rinaldo Brutoco............................................. 21,750(11) *(15)
Michael L. Ray.............................................. 7,500(11) *(15)
Sheldon I. Stein............................................ 18,561(12) *(15)
All executive officers and directors as a group (16
persons).................................................. 8,992,660(5)(13)(14) 23.9(15)
</TABLE>
- ---------------
* Less than 1%
(1) Based on a Schedule 13G filed February 11, 1999, AMVESCAP PLC, a parent
holding company, and certain of its subsidiaries, AVZ, Inc., AIM Management
Group, Inc., AMVESCAP Group Services, Inc., INVESCO, Inc., INVESCO North
American Holdings, Inc., INVESCO Capital Management, Inc., INVESCO Funds
Group, Inc., INVESCO Management and Research, Inc., INVESCO Realty
Advisers, Inc., and INVESCO (NY) Asset Management, Inc., have shared voting
and dispositive powers with respect to these shares and hold these shares
on behalf of other persons who have the right to receive or the power to
direct the receipt of dividends from, or the proceeds from the sale of such
shares.
(2) Based on a Schedule 13G filed February 8, 1999, State Street Research &
Management Company, an investment advisor, has sole voting and dispositive
power with respect to these shares owned by its clients and disclaims any
beneficial interest in such shares.
(3) The business address of the shareholder is 40650 Encyclopedia Circle,
Fremont, California 94538-2453.
(4) All such shares are held by George Zimmer in his capacity as trustee for
the George Zimmer 1988 Living Trust.
(5) Excludes 231,724 shares held by The Zimmer Family Foundation with respect
to which this officer and director has shared voting and dispositive power.
5
<PAGE> 8
(6) Does not include the 31,666 shares of Common Stock held by Robert Zimmer's
wife.
(7) Includes 1,117,899 shares held by James Zimmer in his capacity as trustee
for the James Edward Zimmer 1989 Living Trust and 8,199 shares held by Mr.
Zimmer's wife and minor children.
(8) Includes 47,662 shares held by David Edwab in his capacity as trustee of
the David H. Edwab and Mary Margaret Edwab Family Trust. Also includes
45,000 shares that may be acquired within 60 days upon exercise of stock
options.
(9) Includes 43,437 shares that may be acquired within 60 days upon the
exercise of stock options and includes 300 shares held by Mr. Levy's minor
daughter.
(10) As of the Record Date, Mr. Greenspan did not own any shares of Common
Stock. Pursuant to the merger of a wholly owned subsidiary of the Company
with K&G on June 1, 1999, Mr. Greenspan became the beneficial owner of
approximately 0.5 million shares of Common Stock, representing
approximately 1.2% of the outstanding shares of Common Stock on June 1,
1999.
(11) Represents shares that may be acquired within 60 days upon the exercise of
stock options.
(12) Includes 13,500 shares that may be acquired within 60 days upon the
exercise of stock options and includes 3,561 shares held by Mr. Stein's
minor sons.
(13) Includes 236,815 shares that may be acquired within 60 days upon the
exercise of stock options.
(14) Includes 43,759 shares, 2,696 shares, 39,942 shares, 31,584 shares, 1,400
shares, 17,172 shares and 156,983 shares, respectively, allocated to the
Employee Stock Plan (the "ESP") accounts of Messrs. George Zimmer, Robert
Zimmer, Goldman, James Zimmer, Edwab and Levy and to all executive officers
and directors of the Company as a group, under The Men's Wearhouse ESP. The
ESP provides that participants have voting power with respect to these
shares but do not have investment power over these shares.
(15) The number of total outstanding shares used in calculating the percentage
includes the 2,375,579 shares to be issued in connection with the
Exchangeable Shares. The total outstanding shares does not include the
shares of Common Stock issued in connection with the K&G Merger.
6
<PAGE> 9
EXECUTIVE OFFICERS
The following table lists the name, age, current position and period of
service with the Company of each executive officer of the Company. Each
executive officer of the Company was elected by the Board of Directors of the
Company and will hold office until the next annual meeting of the Board of
Directors or until his or her successor shall have been elected and qualified.
<TABLE>
<CAPTION>
EXECUTIVE
OFFICER
NAME AGE POSITION WITH THE COMPANY SINCE
---- --- ------------------------- ---------
<S> <C> <C> <C>
George Zimmer.......... 50 Chairman of the Board and Chief Executive Officer 1974
David Edwab............ 44 President 1991
Eric J. Lane........... 39 Chief Operating Officer 1993
Richard E. Goldman..... 48 Executive Vice President 1975
Bruce Hampton.......... 44 Executive Vice President 1992
Charles Bresler, 50 Executive Vice President 1993
Ph.D.................
Harry M. Levy.......... 50 Executive Vice President -- Planning and Systems 1991
Robert E. Zimmer....... 75 Senior Vice President -- Real Estate 1974
James E. Zimmer........ 47 Senior Vice President -- Merchandising 1975
Theodore T. Biele, 48 Senior Vice President -- Store Operations 1996
Jr...................
Gary G. Ckodre......... 49 Vice President -- Finance 1992
Neill P. Davis......... 42 Vice President and Treasurer 1997
Stephen H. Greenspan... 58 Chief Executive Officer -- Value Priced Clothing 1999
Division
</TABLE>
See the table under "Election of Directors" for the past business
experience of Messrs. George Zimmer, Edwab, Goldman, Robert E. Zimmer, James E.
Zimmer, Levy and Greenspan.
Eric J. Lane joined the Company in 1988. From 1991 to 1993 he served as
Vice President -- Store Operations and in 1993 he was named Senior Vice
President -- Merchandising. In February 1997 Mr. Lane became Chief Operating
Officer of the Company.
Bruce Hampton joined the Company in 1980. From 1991 to 1992 he served as
Vice President -- Store Operations and in 1992 he was named Senior Vice
President -- Store Operations. In 1995 he was named Executive Vice President.
Charles Bresler, Ph.D. joined the Company in 1993. From 1993 to 1998 he
served as Senior Vice President -- Human Development. In February 1998 he was
named Executive Vice President.
Theodore T. Biele, Jr. joined the Company in 1983. Since 1990 he served in
various management capacities within store operations. From 1994 to 1996 he
served as Vice President -- Store Operations and in 1996 he was named Senior
Vice President -- Store Operations.
Gary G. Ckodre joined the Company in 1992. Since 1992 he served as the
Chief Accounting Officer and in February 1997 he was named Vice
President -- Finance and Principal Financial and Accounting Officer.
Neill P. Davis joined the Company in 1997. Since 1997 he served as Vice
President and Treasurer. Before joining the Company he served as Senior Vice
President and Manager in the Global Corporate Group of NationsBank (currently
Bank of America) since 1987. He has 17 years of corporate banking experience,
all with NationsBank and its predecessors.
7
<PAGE> 10
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding cash
compensation paid for services rendered during the last three fiscal years to
each of the Company's five most highly compensated executive officers, including
the Chief Executive Officer:
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------------------------ ------------
OTHER ANNUAL SECURITIES ALL OTHER
COMPENSATION UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) ($)(5) OPTIONS(9) ($)(6)
- --------------------------- ---- --------- -------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
George Zimmer,............. 1998 420,000 87,500(1) -- -- 66,489(7)
Chairman of the Board and 1997 420,000 87,500(2) -- -- 62,038(7)
Chief Executive Officer 1996 420,000 50,000(3) -- -- 69,403(7)
David Edwab,............... 1998 410,000 87,500(1) -- -- 9,619(8)
President 1997 350,000 332,575(4) -- 150,000 8,617(8)
1996 298,000 313,825(4) -- 75,000 8,908(8)
Eric Lane,................. 1998 260,000 43,750(1) -- -- 933
Chief Operating Officer 1997 247,553 35,000(2) -- 7,500 506
1996 164,000 18,000(3) -- 26,250 1,338
Richard E. Goldman,........ 1998 270,000 35,000(1) -- -- 933
Executive Vice President 1997 270,000 35,000(2) -- -- 506
1996 281,000 24,000(3) -- -- 1,338
James E. Zimmer,........... 1998 360,000 52,500(1) -- -- 933
Senior Vice President -- 1997 356,000 52,500(2) -- -- 506
Merchandising 1996 336,000 30,000(3) -- -- 1,338
</TABLE>
- ---------------
(1) Represents bonus paid in April 1999 relating to services performed in 1998.
(2) Represents bonus paid in April 1998 relating to services performed in 1997.
(3) Represents bonus paid in April 1997 relating to services performed in 1996.
(4) Represents (i) the cash amount of $288,825 and $288,825 paid to Mr. Edwab
during 1997 and 1996, respectively, pursuant to his Employment Agreement
with the Company upon the exercise of his option to acquire 110,654 shares
and 110,652 shares, respectively, of Common Stock, which amounts were used
to fund the purchase price thereof (see "-- Employment Agreement and Stock
Options") and (ii) a bonus of $43,750 and $25,000 paid in April 1998 and
1997, respectively, relating to services performed in the preceding fiscal
year.
(5) Excludes perquisites and other benefits because the aggregate amount of such
compensation was the lesser of $50,000 or 10% of the total annual salary and
bonus reported for the named executive officer.
(6) Represents the amount of the Company's contribution to the ESP allocated in
the indicated year to the account of the named executive officer.
(7) Also includes $65,556, $61,532, and $68,065 in 1998, 1997 and 1996,
respectively, for the allocated dollar value of the benefits to Mr. George
Zimmer of life insurance premiums paid on his behalf, subject to certain
split-dollar provisions in favor of the Company.
(8) Also includes $8,683, $8,111, and $7,570, in 1998, 1997, and 1996,
respectively, for the allocated dollar value of the benefit to Mr. Edwab of
life insurance premiums paid on his behalf, subject to certain split-dollar
provisions in favor of the Company.
(9) All share amounts have been adjusted to reflect a 50% stock dividend
effected in June 1998.
8
<PAGE> 11
EMPLOYMENT AGREEMENT AND STOCK OPTIONS
To induce David Edwab to leave his employment and join the Company, the
Company entered into an Employment Agreement with Mr. Edwab effective January
31, 1991 (as amended, the "Employment Agreement") for an initial term beginning
February 25, 1991 and extending through February 24, 1999. Under the Employment
Agreement the Company agreed, among other things, to:
- pay Mr. Edwab an annual base salary of $226,000, plus $12,000 per year
for reimbursement of automobile and club membership expenses;
- pay Mr. Edwab a cash amount (net of state and federal taxes) sufficient
to fund the payment of the purchase price for any option shares acquired
upon any exercise of the option granted to Mr. Edwab under his Employment
Agreement;
- pay the premiums on $3,000,000 in life insurance policies to be owned by
a trust established by Mr. Edwab and payable to beneficiaries designated
by him (subject to certain split-dollar provisions in favor of the
Company). To secure the repayment of the premiums, the Trust has assigned
the policies to the Company as collateral; and
- provide disability and medical insurance coverage and certain other
benefits provided to other employees (other than participation in stock
option plans).
Pursuant to the Employment Agreement, the Company granted Mr. Edwab an
option to purchase 796,705 shares of Common Stock at $1.57 per share until the
later of the termination of Mr. Edwab's employment and January 31, 2011. The
option was immediately exercisable with respect to 33.3% of the option shares.
Since that time the remaining 66.7% of the option shares have become fully
exercisable and the option has been exercised as to all of the option shares.
The Company may terminate Mr. Edwab's employment under the Employment
Agreement for "cause" (as defined in the Employment Agreement), in which event
the Company will pay all compensation and benefits due Mr. Edwab under the
Employment Agreement to the date of termination, which will satisfy all of the
Company's obligations under the Employment Agreement.
Effective September 30, 1991, the Company entered into an Option Issuance
Agreement with Mr. Edwab pursuant to which he was granted the right to purchase
additional shares of Common Stock on the same basis and subject to the same
terms as the option shares under the Employment Agreement in the event the
Company issues any shares of Common Stock or any warrants, options, convertible
securities or other rights to acquire Common Stock (collectively, "Rights")
during the term of the Option Issuance Agreement. At the same time, the
Employment Agreement was amended to eliminate certain anti-dilution provisions
that provided him with protection in the event of future issuances of Common
Stock by the Company. Should the Company issue any such shares or Rights,
excluding the option shares issuable under the Employment Agreement, Mr. Edwab
would automatically have the right to purchase a number of shares of Common
Stock equal to .030928 times the number of shares so issued or issuable upon
exercise of the Rights. The purchase price would be equal to the price per share
paid to the Company for the Common Stock so issued or, in the case of Rights,
for the Rights plus the exercise price per share of the Common Stock issuable
thereunder.
Mr. Edwab waived his right to receive additional options under the Option
Issuance Agreement in connection with:
- options granted under the Company's option plans;
- the issuance of 2,531,250 shares of Common Stock pursuant to a public
offering consummated in April 1992;
- the issuance of 1,423,125 shares of Common Stock pursuant to a public
offering consummated in April 1993; and
- the issuance of Common Stock upon conversion of the Company's 5 1/4%
Convertible Subordinated Notes due 2003.
9
<PAGE> 12
In April 1994, the Option Issuance Agreement was amended to provide that no
options would be granted to Mr. Edwab thereunder in connection with underwritten
public offerings of equity securities by the Company. As amended, both the
Employment Agreement and the Option Issuance Agreement provide that Mr. Edwab
may satisfy his obligation to pay withholding tax relating to his exercise of
any options thereunder by having the Company withhold a number of shares of
Common Stock that would have been issued upon such exercise equal in value to
the amount of such tax owed.
SPLIT-DOLLAR LIFE INSURANCE AGREEMENT
The George Zimmer 1988 Living Trust is presently the owner of 4,097,783
shares of Common Stock. The Company has been advised that on the demise of
George Zimmer, his estate may be required to publicly sell all or substantially
all of such shares to satisfy estate tax obligations. The public sale of such
number of shares in all probability would destabilize the market for the
Company's publicly traded stock. Accordingly, in November 1994, an agreement was
entered into (commonly known as split-dollar life insurance agreement) under the
terms of which the Company makes advances of a portion of the premiums for
certain life insurance policies on the life of George Zimmer with an aggregate
face value of $25,500,000 purchased by a trust established by Mr. Zimmer. To
secure the repayment of the advances, the trust has assigned the policies to the
Company as collateral. Further, a second split-dollar life insurance agreement
with essentially the same terms as the existing agreement was entered into
relating to a life insurance policy on the life of George Zimmer with a face
value of $1,000,000 purchased by a second trust established by Mr. Zimmer. The
trusts have assigned the additional policies to the Company as collateral.
EMPLOYEE STOCK OPTION PLANS
The Company maintains The Men's Wearhouse, Inc. 1992 Stock Option Plan (the
"1992 Option Plan"), 1996 Stock Option Plan (the "1996 Option Plan"), and 1998
Key Employee Stock Option Plan (the "1998 Option Plan") (collectively, the
"Plans") for the benefit of its full-time key employees. Under the 1992 Option
Plan, options to purchase up to 1,071,507 shares of Common Stock may be granted.
Under the 1996 Option Plan, options to purchase up to 1,125,000 shares of Common
Stock may be granted. Subsequent to the Record Date, the Board of Directors
amended the 1998 Option Plan to increase the number of shares which may be
covered by options granted pursuant to the 1998 Option Plan to 1,500,000 shares.
The Plans are administered by the Stock Option Committee of the Company's
Board of Directors which consists of George Zimmer and Richard Goldman. The
individuals eligible to participate in the Plans are such full-time key
employees, including officers and employee directors, of the Company as the
Stock Option Committee may determine from time to time. However:
- George Zimmer, Richard E. Goldman, Robert E. Zimmer and James E. Zimmer
are not eligible to participate in any of the Plans;
- David Edwab may not participate in the 1992 Option Plan; and
- no executive officers of the Company may participate in the 1998 Option
Plan.
The Stock Option Committee may grant either (i) incentive stock options
within the meaning of section 422 of the Internal Revenue Code of 1986, as
amended, or (ii) non-statutory stock options. 500,000 shares of Common Stock is
the maximum number of shares subject to options that may be awarded under the
1996 Option Plan or the 1998 Option Plan to any employee during any consecutive
three-year period. The purchase price of shares subject to an option granted
under the Plans is determined by the Stock Option Committee at the date of
grant. The purchase price may not be less than 50% of the fair market value of
the shares of Common Stock on the date of grant. Options granted under the Plans
must be exercised within ten years from the date of grant. Unless otherwise
provided by the Stock Option Committee, the options vest with respect to
one-third of the shares covered thereby on each of the first three anniversaries
of the date of grant. In the case of any eligible employee who owns or is deemed
to own stock possessing more than 10% of the total combined voting power of all
classes of stock of the Company or its parent or subsidiaries, (i) the option
price of any
10
<PAGE> 13
incentive stock option granted may not be less than 110% of the fair market
value of the Common Stock on the date of grant, and (ii) the exercisable period
may not exceed five years from date of grant.
Options granted under the Plans terminate on the earlier of (i) the
expiration date of the option or (ii) one day less than one month after the date
the holder of the option terminated his or her employment with the Company for
any reason other than the death, disability or retirement of such holder. During
such one-month period, the holder may exercise the option in respect of the
number of shares that were vested on the date of such severance of employment.
In the event of severance because of the disability of a holder before the
expiration date of the option, the option terminates on the earlier of such (i)
expiration date or (ii) one year following the date of severance. During this
period the holder may exercise the option in respect of the number of shares
that were vested on the date of severance because of disability. In the event of
the death or retirement of a holder, the option terminates on the earlier of (i)
the expiration date of the option or (ii) one year following the date of death
or retirement.
OPTION GRANTS
No options were granted to the named executive officers during the fiscal
year ended January 30, 1999.
OPTION EXERCISES
The following table sets forth the aggregate option exercises during the
last fiscal year and the value of outstanding options at year-end held by the
named executive officers:
AGGREGATE OPTION EXERCISES IN FISCAL 1998 AND OPTION VALUES AT JANUARY 30, 1999
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY
ACQUIRED ON VALUE OPTIONS AT YEAR END(#) OPTIONS AT YEAR END($)
NAME EXERCISE(#) REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- ----------- ----------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
George Zimmer.............. -- -- -- --
David Edwab................ -- -- 45,000/180,000 538,000/1,721,000
Richard E. Goldman......... -- -- -- --
Eric Lane(1)............... 5,000 128,000 28,751/48,750 506,000/712,000
James E. Zimmer............ -- -- -- --
</TABLE>
- ---------------
(1) The options exercised were granted under the 1992 Option Plan.
COMPENSATION OF DIRECTORS
All employee directors of the Company do not receive fees for attending
meetings of the Board of Directors. Each non-employee director of the Company
receives a quarterly retainer of $2,500. In addition, under the Company's 1992
Non-Employee Director Stock Option Plan (the "Director Plan"), each person who
is a non-employee director on the last business day of each fiscal year of the
Company is granted an option to acquire 2,000 shares of Common Stock. All
options granted permit the non-employee director to purchase the option shares
at the closing price on the date of grant and become exercisable one year after
the date of grant. All options granted under the Director Plan must be exercised
within 10 years of the date of grant. Such options terminate on the earlier of
the date of the expiration of the option or one day less than one month after
the date the director ceases to serve as a director of the Company for any
reason other than death, disability or retirement as a director.
On January 29, 1999, the Company granted each of Messrs. Brutoco, Stein and
Ray an option to purchase 2,000 shares of Common Stock at $29.625 per share
pursuant to the Director Plan.
11
<PAGE> 14
PERFORMANCE GRAPH
The following graph compares, as of each of the dates indicated, the
percentage change in the Company's cumulative total shareholder return on the
Common Stock with the cumulative total return of the NASDAQ Composite Index and
the Retail Specialty Apparel Index. The graph assumes that the value of the
investment in the Common Stock and each index was $100 at April 15, 1992 (the
date the Common Stock was first publicly traded) and that all dividends paid by
those companies included in the indices were reinvested.
<TABLE>
<CAPTION>
Retail Nasdaq
Measurement Period Specialty Composite
(Fiscal Year Covered) Company Apparel Index
<S> <C> <C> <C>
04/15/92 1.000 1.000 1.000
01/30/93 1.423 1.083 1.167
01/29/94 3.043 1.012 1.327
01/28/95 2.567 0.903 1.287
02/03/96 4.889 1.065 1.863
02/01/97 4.608 1.251 2.416
01/31/98 6.209 2.048 2.854
01/30/99 7.691 3.798 4.455
</TABLE>
The foregoing graph is based on historical data and is not necessarily
indicative of future performance. This graph shall not be deemed to be
"soliciting material" or to be "filed" with the Commission or subject to
Regulations 14A and 14C under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), or to the liabilities of section 18 under the Exchange
Act.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
No member of the Compensation Committee of the Board of Directors of the
Company was, during fiscal 1998, an officer or employee of the Company or any of
its subsidiaries, or was formerly an officer of the Company or any of its
subsidiaries, or had any relationships requiring disclosure by the Company under
Item 404 of Regulation S-K, except as described below:
- In February 1998, Insight Out Collaborations LLC provided consulting and
training services to the Company for consideration of $69,000. Mr. Ray is
an officer and director of Insight Out Collaborations LLC and owns 10.8%
of the outstanding shares of stock of such company.
- Under the terms of an Engagement Letter dated September 9, 1998, Bear
Stearns served as the Company's financial advisor in connection with the
Moores transaction. Mr. Stein, a director of the Company, is a Senior
Managing Director of Bear Stearns and oversees its United States regional
investment banking offices.
During fiscal 1998, no executive officer of the Company served as (i) a
member of the compensation committee (or other board committee performing
equivalent functions) of another entity, one of whose executive officers served
on the Compensation Committee of the Board of Directors, (ii) a director of
another entity, one of whose executive officers served on the Compensation
Committee, or (iii) a member of the
12
<PAGE> 15
compensation committee (or other board committee performing equivalent
functions) of another entity, one of whose executive officers served as a
director of the Company.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee (the "Committee") of the Board of Directors of
The Men's Wearhouse, Inc. (the "Company") is pleased to present its 1998 report
on executive compensation. This Committee report documents components of the
Company's executive officer compensation programs and describes the basis on
which 1998 compensation determinations were made by the Committee with respect
to the executive officers of the Company, including the executive officers that
are named in the compensation tables. The Committee is comprised entirely of
non-employee directors.
Compensation Philosophy and Overall Objectives of Executive Compensation
Programs
It is the philosophy of the Company to ensure that executive compensation
be directly linked to continuous improvements in corporate financial performance
and increases in shareholder value. The following objectives, which were adopted
by the Committee, serve as the guiding principles for all compensation
decisions:
- Provide a competitive total compensation package that enables the Company
to retain key executives.
- Integrate pay programs with the Company's annual and long-term business
objectives and strategy, and focus executive behavior on the fulfillment
of those objectives.
- Provide variable compensation opportunities that are directly linked with
the performance of the Company and that align executive remuneration with
the interests of shareholders.
The Committee believes that the Company's current executive compensation
program has been designed and is administered in a manner consistent with these
objectives.
Executive Compensation Program Components
The Company uses cash-and equity-based compensation to achieve its
pay-for-performance philosophy and to reward short-and long-term performance.
Base Salary. The Company's compensation philosophy is to control
compensation costs and to place greater emphasis on incentive compensation based
on results. Accordingly, the Committee believes that the Company's base salaries
are well within the industry norms for companies of similar size. Salaries for
executives are reviewed periodically and revised, if appropriate, based on a
variety of factors, including individual performance, level of responsibility,
prior experience, breath of knowledge, external pay practices and overall
financial results.
Incentive Compensation. The Company's philosophy is to use a combination of
annual and long-term compensation methods for the majority of the Company's
management. The Committee understands that the majority of executive officers
named in the compensation table hold significant ownership interests in the
Company. Accordingly, it is the belief of the Committee that incentives through
stock option participation at this time for the majority of these individuals
would not significantly affect the long-term or short-term perspective of these
individuals.
The Committee has adopted a bonus program for 1999 in which executive
officers will participate. A maximum bonus has been set for each of the named
executive officers based upon the total compensation package of the officer
relative to his duties, which bonuses range from $40,000 to $100,000.
The criteria for determining the amount of bonus participation is based on:
(i) the Company attaining sales goals, (ii) the Company attaining net income
goals, (iii) the Company attaining shrinkage goals, and (iv) the officer
attaining personal goals. Each of the first three criteria are quantitative,
while the fourth criterion is subjective. The Company's bonus program for the
majority of the work force is based on attaining similar sales and shrinkage
goals.
13
<PAGE> 16
Discussion of 1998 Compensation for the Chief Executive Officer
George Zimmer, Chairman of the Board and Chief Executive Officer of the
Company, is a significant shareholder in the Company, as well as one of the
Company's founders.
In determining Mr. Zimmer's compensation for 1998, the Committee considered
the Company's financial performance and corporate accomplishments, individual
performance and salary data for chief executive officers of other publicly held
apparel companies having a size and focus that the Committee believed comparable
to the Company's. The Committee also reviewed more subjective factors, such as
development and implementation of the corporate strategies to enhance
shareholder value and the Company's overall corporate philosophy. The Committee
feels that Mr. Zimmer's compensation program for 1998 and 1999 is conservative.
Base Salary. Mr. Zimmer's base salary during fiscal 1998 was $35,000 per
month. While the Committee believes that the performance of Mr. Zimmer and the
Company would justify a substantial increase in Mr. Zimmer's base salary, Mr.
Zimmer has advised the Committee that he is satisfied with his current base
salary and therefore no change has been approved for fiscal 1999.
Annual Incentive. Mr. Zimmer was paid an $87,500 bonus under the 1998 bonus
program. Mr. Zimmer will be eligible for a bonus of up to $100,000 in 1999 based
on the criteria discussed under "Incentive Compensation".
Summary. The Company's 1998 financial results exceeded management's
expectations. It is the opinion of the Compensation Committee that the total
compensation program for 1998 for the executive officers relative to the
Company's performance was reasonable and that the compensation to George Zimmer
remains modest in light of management's achievements and the total compensation
packages provided to chief executive officers by other publicly held clothing
retailers.
COMPENSATION COMMITTEE
Sheldon I. Stein, Chairman
Michael L. Ray
14
<PAGE> 17
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company leases a warehouse facility in Houston, Texas from Zig Zag, a
Texas joint venture, in which George Zimmer, James E. Zimmer and Richard E.
Goldman are the sole and equal joint venturers. During 1998, the Company paid
rentals of $78,000 to Zig Zag. The lease expires on August 31, 2005.
The Company also leases the land underlying a store in Dallas, Texas (which
building is owned by the Company) from 8239 Preston Road, Inc., a Texas
corporation of which George Zimmer, James E. Zimmer and Richard E. Goldman each
own 20% of the outstanding common stock, and Laurie Zimmer, sister of George and
James Zimmer and daughter of Robert E. Zimmer, owns 40% of the outstanding
common stock. The Company paid aggregate rentals on such property to such
corporation of $49,200 in 1998. The lease expires April 30, 2004.
K&G leases its Irving, Texas store from 3S Corporation, a corporation of
which Mr. Greenspan owns 25%. Pursuant to this arrangement, K&G made lease
payments of $66,000 in fiscal 1998. The lease for this store currently provides
that K&G pay rent of $5,500 per month.
Ellsworth Realty, LLC, a limited liability company of which Mr. Greenspan
beneficially owns 50%, leases office space and a warehouse in Atlanta, Georgia
to K&G. The lease provides for K&G to pay Ellsworth Realty a specified amount
for the warehouse and office space and a specified amount for the retail space
plus 1% of the net sales of the store in excess of a certain threshold amount.
Pursuant to this arrangement, K&G paid or accrued to Ellsworth Realty
approximately $280,713 in fiscal 1998.
Management believes that the terms of the foregoing leasing arrangements
are comparable to what would have been available to the Company from
unaffiliated third parties at the time such leases were entered into.
8239 Preston Road, Inc. and Zig Zag each have loans with Bank of America
and have agreed that a default by the Company under the Company's Credit
Agreement with Bank of America will constitute a default under the loan
agreements of such partnership or corporation with Bank of America. If for any
reason the Company's loan with Bank of America becomes due and payable or is
paid, the loans to such partnership or corporation from Bank of America will
become automatically due and payable. The loans from Bank of America to Zig Zag
and 8239 Preston Road, Inc. mature in June 2000. The maximum principal amount
outstanding under the loans to Zig Zag and 8239 Preston Road, Inc. during 1998
was $548,000 and $365,000, respectively. With the exception of Laurie Zimmer,
each of the partners and shareholders of such partnership or corporation has
personally guaranteed the obligations of the respective entity under the loan
agreements.
The Company has engaged Dorason Corporation to provide consulting services,
on a non-exclusive basis, to the Company with respect to general business
matters including, specifically, internet commerce for a fee of $20,000 per
month plus reimbursement of certain expenses. This engagement is cancellable by
either party on 60 days notice. Mr. Brutoco is the chairman and chief executive
officer, and, together with his wife, owns 100% of Dorason Corporation.
In addition, the Company has utilized the services of Regal Aviation LLC
("Regal Aviation"), which operates a private air charter service, to provide air
transportation from time to time for employees of the Company. To date, the
Company has paid approximately $100,000 to Regal Aviation for such services.
Regal Aviation is a limited liability company of which George Zimmer, Robert
Zimmer, James Zimmer and Richard Goldman own an aggregate of approximately 98%
of the membership interest. The charter rates charged by Regal Aviation are at
least as favorable as can be obtained from independent air charter services.
The Company's Board of Directors has authorized a corporate joint venture
to develop and implement certain retail store systems software to be used by the
Company and to be marketed to third parties. The Company will own a 50% interest
in the joint venture and Blue Water Resources LLC ("Blue Water") will own 50%.
Harry Levy, an officer and director of the Company, will own a one-third
interest in Blue Water. The Company will pay the actual costs incurred by the
joint venture to develop and implement the software in the Company's operations.
After development and implementation of the software for the Company, the joint
venture will attempt to market the software to third parties.
15
<PAGE> 18
In December 1996, the Company advanced $166,000 to Mr. Lane to enable him
to purchase a residence. In 1998, Mr. Lane paid the Company $9,097 in interest
on this advance at an average rate of 5.5% per annum.
See "Compensation Committee Interlocks and Insider Participation" for
additional information regarding certain relationships and related transactions
with Messrs. Ray and Stein.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
To the Company's knowledge, and except as set forth below, based solely on
a review of the copies of the reports required pursuant to Section 16(a) of the
Exchange Act that have been furnished to the Company and written representations
that no other reports were required, during the fiscal year ended January 30,
1999, all Section 16(a) filing requirements applicable to its directors,
executive officers and greater than 10% beneficial owners have been met, except
for Mr. Brutoco. In January 1999, Mr. Brutoco purchased an aggregate of 300
shares which were inadvertently omitted from his Form 5 filed on February 8,
1999. His Form 5 was amended on April 8, 1999. In February of 1999, Mr. Brutoco
purchased 200 shares and these shares were reported with his March 1999 Form 4
filed on April 8, 1999.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed the firm of Deloitte & Touche LLP as
independent auditors for the fiscal year ending January 29, 2000, subject to
ratification by the shareholders at the Annual Meeting. Representatives of
Deloitte & Touche LLP are expected to attend the Annual Meeting, will be
afforded an opportunity to make a statement if they desire to do so, and will be
available to respond to appropriate questions by shareholders.
PROPOSALS FOR NEXT ANNUAL MEETING
Any proposals of shareholders intended to be presented at the annual
meeting of shareholders of the Company to be held in 2000 must be received by
the Company at its corporate offices, 5803 Glenmont Drive, Houston, Texas 77081,
no later than February 3, 2000, in order to be considered for inclusion in the
proxy statement and form of proxy relating to that meeting.
OTHER MATTERS
The management of the Company knows of no other matters which may come
before the meeting. However, if any matters other than those referred to above
should properly come before the meeting, it is the intention of the persons
named in the enclosed proxy to vote such proxy in accordance with their best
judgment.
The cost of solicitation of proxies in the accompanying form will be paid
by the Company. In addition to solicitation by use of the mails, certain
directors, officers or employees of the Company may solicit the return of
proxies by telephone, telegram or personal interview.
16
<PAGE> 19
PROXY THE MEN'S WEARHOUSE, INC. PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JULY 1, 1999
The undersigned shareholder of The Men's Wearhouse, Inc. (the "Company")
hereby appoints George Zimmer and David Edwab, or either of them, attorneys and
proxies of the undersigned, with full power of substitution to vote, as
designated below, the number of votes which the undersigned would be entitled to
cast if personally present at the Annual Meeting of Shareholders of the Company
to be held at 4:00 PM, central daylight time, on Thursday, July 1, 1999, at The
Houstonian Hotel, 111 N. Post Oak Lane, Houston, Texas, and at any adjournment
or adjournments thereof.
1. Election of Directors:
<TABLE>
<S> <C>
[ ] FOR all nominees listed, except as indicated to the [ ] WITHHOLD AUTHORITY to vote for election of all
contrary below nominees
</TABLE>
Nominees: George Zimmer, David Edwab, Richard E. Goldman, Robert E. Zimmer,
James E. Zimmer,
Harry M. Levy, Stephen H. Greenspan, Rinaldo Brutoco, Michael L. Ray and
Sheldon I. Stein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT PERSON'S NAME IN THE SPACE PROVIDED AT RIGHT.)
- --------------------------------------------------------------------------------
2. Proposal to amend the Company's Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to ratify the appointment of Deloitte & Touche LLP as independent
auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Continued, and to be signed on reverse side)
4. In their discretion, the above-named proxies are authorized to vote upon such
other matters as may properly come before the meeting or any adjournment
thereof and upon matters incident to the conduct of the meeting.
This Proxy will be voted as directed. IF NOT OTHERWISE SPECIFIED, THE SHARES
WILL BE VOTED FOR EACH OF THE NOMINEES LISTED HEREIN AND FOR PROPOSAL 2 AND 3.
As noted in the accompanying proxy statement, receipt of which is hereby
acknowledged, if any of the listed nominees becomes unavailable for any reason
and authority to vote for election of directors is not withheld, the shares will
be voted for another nominee or other nominees to be selected by the Board of
Directors.
Dated -------------------, 1999
-------------------------------
-------------------------------
Signature of Shareholder
Your signature should
correspond with your name as it
appears hereon. Joint owners
should each sign. When signing
as attorney, executor,
administrator, trustee or
guardian, please set forth your
full title as it appears
hereon.
PLEASE MARK, SIGN, DATE AND
RETURN IMMEDIATELY
<PAGE> 20
THE MEN'S WEARHOUSE, INC.
PROXY VOTING INSTRUCTIONS
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JULY 1, 1999
The Board of Directors of The Men's Wearhouse, Inc. (the "Company")
recommends a vote "FOR" each of the following proposals. Please provide voting
instructions by marking your choices below.
1. Election of Directors:
<TABLE>
<S> <C>
[ ] FOR all nominees listed, except as indicated to [ ] WITHHOLD AUTHORITY to vote for election of all
the contrary below nominees
</TABLE>
Nominees: George Zimmer, David Edwab, Richard E. Goldman, Robert E. Zimmer,
James E. Zimmer,
Harry M. Levy, Stephen H. Greenspan, Rinaldo Brutoco, Michael L. Ray
and Sheldon I. Stein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT PERSON'S NAME IN THE SPACE PROVIDED AT RIGHT.)
- --------------------------------------------------------------------------------
2. Proposal to amend the Company's Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Continued, and to be signed on reverse side)
3. Proposal to ratify the appointment of Deloitte & Touche LLP as independent
auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The shares allocated to your account in the Company's 401(k) Savings Plan
will be voted as directed. IF NOT OTHERWISE SPECIFIED, THE SHARES WILL BE VOTED
FOR EACH OF THE NOMINEES LISTED HEREIN AND FOR PROPOSALS 2 AND 3. As noted in
the accompanying proxy statement, receipt of which is hereby acknowledged, if
any of the listed nominees becomes unavailable for any reason and authority to
vote for election of directors is not withheld, the shares will be voted for
another nominee or other nominees to be selected by the Board of Directors.
Dated ------------------, 1999
-------------------------------
-------------------------------
Signature of Shareholder
PLEASE MARK, SIGN, DATE AND
RETURN IMMEDIATELY
<PAGE> 21
THE MEN'S WEARHOUSE, INC.
PROXY VOTING INSTRUCTIONS
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JULY 1, 1999
The Board of Directors of The Men's Wearhouse, Inc. (the "Company")
recommends a vote "FOR" each of the following proposals. Please provide voting
instructions by marking your choices below.
1. Election of Directors:
<TABLE>
<S> <C>
[ ] FOR all nominees listed, except as indicated to [ ] WITHHOLD AUTHORITY to vote for election of all
the contrary below nominees
</TABLE>
Nominees: George Zimmer, David Edwab, Richard E. Goldman, Robert E. Zimmer,
James E. Zimmer,
Harry M. Levy, Stephen H. Greenspan, Rinaldo Brutoco, Michael L. Ray
and Sheldon I. Stein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT PERSON'S NAME IN THE SPACE PROVIDED AT RIGHT.)
- --------------------------------------------------------------------------------
2. Proposal to amend the Company's Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Continued, and to be signed on reverse side)
3. Proposal to ratify the appointment of Deloitte & Touche LLP as independent
auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The shares allocated to your account in the Company's Employee Stock Plan
will be voted as directed. IF NOT OTHERWISE SPECIFIED, THE SHARES WILL BE VOTED
FOR EACH OF THE NOMINEES LISTED HEREIN AND FOR PROPOSALS 2 AND 3. As noted in
the accompanying proxy statement, receipt of which is hereby acknowledged, if
any of the listed nominees becomes unavailable for any reason and authority to
vote for election of directors is not withheld, the shares will be voted for
another nominee or other nominees to be selected by the Board of Directors.
Dated ------------------, 1999
-------------------------------
-------------------------------
Signature of Shareholder
PLEASE MARK, SIGN, DATE AND
RETURN IMMEDIATELY
<PAGE> 22
THE MEN'S WEARHOUSE, INC.
PROXY VOTING INSTRUCTIONS
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JULY 1, 1999
The Board of Directors of The Men's Wearhouse, Inc. (the "Company")
recommends a vote "FOR" each of the following proposals. Please provide voting
instructions by marking your choices below.
1. Election of Directors:
<TABLE>
<S> <C>
[ ] FOR all nominees listed, except as indicated to [ ] WITHHOLD AUTHORITY to vote for election of all
the contrary below nominees
</TABLE>
Nominees: George Zimmer, David Edwab, Richard E. Goldman, Robert E. Zimmer,
James E. Zimmer,
Harry M. Levy, Stephen H. Greenspan, Rinaldo Brutoco, Michael L. Ray
and Sheldon I. Stein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT PERSON'S NAME IN THE SPACE PROVIDED AT RIGHT.)
- --------------------------------------------------------------------------------
2. Proposal to amend the Company's Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Continued, and to be signed on reverse side)
3. Proposal to ratify the appointment of Deloitte & Touche LLP as independent
auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
The shares allocated to your account in the Company's Employee Stock
Discount Plan will be voted as directed. IF NOT OTHERWISE SPECIFIED, THE SHARES
WILL BE VOTED FOR EACH OF THE NOMINEES LISTED HEREIN AND FOR PROPOSALS 2 AND 3.
As noted in the accompanying proxy statement, receipt of which is hereby
acknowledged, if any of the listed nominees becomes unavailable for any reason
and authority to vote for election of directors is not withheld, the shares will
be voted for another nominee or other nominees to be selected by the Board of
Directors.
Dated ------------------, 1999
-------------------------------
-------------------------------
Signature of Shareholder
PLEASE MARK, SIGN, DATE AND
RETURN IMMEDIATELY
<PAGE> 23
THE MEN'S WEARHOUSE, INC.
PROXY VOTING INSTRUCTIONS
TO THE HOLDER OF THE COMPANY'S SERIES A SPECIAL VOTING PREFERRED STOCK
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JULY 1, 1999
The Board of Directors of The Men's Wearhouse, Inc. (the "Company")
recommends a vote "FOR" each of the following proposals. Please provide voting
instructions by marking your choices below.
(Please indicate which of the two options outlined below you are choosing by
checking the box appearing at the beginning of such option)
[ ] Please attend the meeting in person or by proxy and exercise such votes as
follows:
1. Election of Directors:
<TABLE>
<S> <C>
[ ] FOR all nominees listed, except as indicated to the [ ] WITHHOLD AUTHORITY to vote for election of all nominees
contrary below
</TABLE>
Nominees: George Zimmer, David Edwab, Richard E. Goldman, Robert E. Zimmer,
James E. Zimmer, Harry M. Levy, Stephen H. Greenspan, Rinaldo
Brutoco, Michael L. Ray and Sheldon I. Stein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT PERSON'S NAME IN THE SPACE PROVIDED AT RIGHT.)
- --------------------------------------------------------------------------------
2. Proposal to amend the Company's Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(Continued, and to be signed on reverse side)
3. Proposal to ratify the appointment of Deloitte & Touche LLP as independent
auditors.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
You have the right to instruct the Trustee which holds of record the
Company's Series A Special Voting Preferred Stock how to vote such stock with
respect to the Exchangeable Shares of Moores Retail Group Inc. ("Moores") held
by you. Unless otherwise instructed below, by executing this Proxy Voting
Instructions you authorize and direct the Trustee to vote the votes of the
Preferred Stock represented by all of your Exchangeable Shares in accordance
with this Proxy Voting Instructions. IF NOT OTHERWISE SPECIFIED HEREIN, THE
UNDERSIGNED DIRECTS THE TRUSTEE TO VOTE FOR EACH OF THE NOMINEES LISTED HEREIN
AND FOR PROPOSALS 2 AND 3. As noted in the accompanying proxy statement, receipt
of which is hereby acknowledged, if any of the listed nominees becomes
unavailable for any reason and authority to vote for election of directors is
not withheld, the shares will be voted for another nominee or other nominees to
be selected by the Board of Directors.
-- or --
[ ] Please provide the undersigned Shareholder with a proxy entitling the
Shareholder to attend the meeting personally and exercise the votes to which he
is entitled pursuant to the Voting Trust Agreement dated as of February 10,
1999.
<TABLE>
<S> <C>
I hereby withhold instructions with respect to Dated ______________________________, 1999
_________________ shares of Exchangeable Shares of Moores.
__________________________________________
__________________________________________
Signature of Shareholder
PLEASE MARK, SIGN, DATE AND RETURN TO THE
TRUSTEE BY FACSIMILE (416-867-6264) AT OR
PRIOR TO THE CLOSE OF BUSINESS ON JUNE 29,
1999
</TABLE>
<PAGE> 24
PROXY THE MEN'S WEARHOUSE, INC. PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JULY 1, 1999
The undersigned shareholder of the one share of The Men's Wearhouse, Inc.
(the "Company") Series A Special Voting Preferred Stock hereby appoints George
Zimmer and David Edwab, or either of them, attorneys and proxies of the
undersigned, with full power of substitution to vote, as designated below, the
number of votes which the undersigned would be entitled to cast if personally
present at the Annual Meeting of Shareholders of the Company to be held at 4:00
PM, central daylight time, on Thursday, July 1, 1999, at The Houstonian Hotel,
111 N. Post Oak Lane, Houston, Texas, and at any adjournment or adjournments
thereof.
1. Election of Directors:
<TABLE>
<S> <C>
____ Votes FOR all nominees listed, except as indicated to ____ Votes WITHHOLD AUTHORITY to vote for election of all
the contrary below nominees
</TABLE>
Nominees: George Zimmer, David Edwab, Richard E. Goldman, Robert E. Zimmer,
James E. Zimmer,
Harry M. Levy, Stephen H. Greenspan, Rinaldo Brutoco, Michael L. Ray and
Sheldon I. Stein.
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT PERSON'S NAME AND THE NUMBER OF VOTES AS TO WHICH SUCH AUTHORITY IS
WITHHELD IN THE SPACE PROVIDED AT RIGHT.)
- --------------------------------------------------------------------------------
2. Proposal to amend the Company's Restated Articles of Incorporation to
increase the number of authorized shares of Common Stock.
____ Votes FOR ____ Votes AGAINST ____ Votes
ABSTAIN
3. Proposal to ratify the appointment of Deloitte & Touche LLP as independent
auditors.
____ Votes FOR ____ Votes AGAINST ____ Votes
ABSTAIN
(Continued, and to be signed on reverse side)
This Proxy will be voted as directed. As noted in the accompanying proxy
statement, receipt of which is hereby acknowledged, if any of the listed
nominees becomes unavailable for any reason and authority to vote for election
of directors is not withheld, the shares will be voted for another nominee or
other nominees to be selected by the Board of Directors.
Dated ------------------ , 1999
-------------------------------
-------------------------------
Signature of Shareholder
PLEASE MARK, SIGN, DATE AND
RETURN IMMEDIATELY
