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 [ ] 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 ss. 240.14a-11(c) or ss. 240.14a-12
Stein Mart, 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)(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:
<PAGE>
Stein Mart, Inc.
----------------
NOTICE AND PROXY STATEMENT
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 17, 1999
TO THE HOLDERS OF COMMON STOCK:
PLEASE TAKE NOTICE that the annual meeting of stockholders of Stein
Mart, Inc. will be held on Monday, May 17, 1999, at 2:00 P.M., local time, at
The Cummer Museum of Art and Gardens, 829 Riverside Avenue, Jacksonville,
Florida.
The meeting will be held for the following purposes:
1. To elect a Board of Directors for the ensuing year and until
their successors have been elected and qualified.
2. To transact such other business as may properly come before
the meeting or any adjournment thereof.
The stockholders of record at the close of business on March 16, 1999,
will be entitled to vote at the annual meeting.
It is hoped you will be able to attend the meeting, but in any event,
we will appreciate it if you will date, sign and return the enclosed proxy as
promptly as possible. If you are able to be present at the meeting, you may
revoke your proxy and vote in person.
By Order of the Board of Directors,
James G. Delfs
Secretary
Dated: April 9, 1999
<PAGE>
Stein Mart, Inc.
1200 Riverplace Boulevard
Jacksonville, Florida 32207
---------------
PROXY STATEMENT FOR ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD MAY 17, 1999.
This Proxy Statement and the enclosed form of proxy are being sent to
stockholders of Stein Mart, Inc. on or about April 9, 1999 in connection with
the solicitation by the Company's Board of Directors of proxies to be used at
the Annual Meeting of Stockholders of the Company. The meeting will be held on
Monday, May 17, 1999 at 2:00 P.M., local time, at The Cummer Museum of Art and
Gardens, 829 Riverside Avenue, Jacksonville, Florida.
The Board of Directors has designated Jay Stein and John H. Williams,
Jr., and each or either of them, as proxies to vote the shares of common stock
solicited on its behalf. If the enclosed form of proxy is executed and returned,
it may nevertheless be revoked at any time insofar as it has not been exercised
by (i) giving written notice to the Secretary of the Company, (ii) delivery of a
later dated proxy, or (iii) attending the meeting and voting in person. The
shares represented by the proxy will be voted unless the proxy is mutilated or
otherwise received in such form or at such time as to render it not votable.
VOTING SECURITIES
The stockholders of record entitled to vote was determined at the close
of business on March 16, 1999. At such date, the Company had outstanding and
entitled to vote 45,348,623 shares of common stock, $.01 par value. Each share
of common stock entitles the holder to one vote. Holders of a majority of the
outstanding shares of common stock must be present in person or represented by
proxy to constitute a quorum at the annual meeting.
The following table shows the name, address and beneficial ownership as
of February 26, 1999 of each person known to the Company to be the beneficial
owner of more than 5% of its outstanding common stock:
Amount and Nature of Percent
Beneficial Owner Beneficial Ownership of Class
- ---------------- -------------------- --------
Jay Stein 16,333,722(1) 36.0%
1200 Riverplace Boulevard
Jacksonville, Florida 32207
FMR Corp. 4,315,700(2) 9.5%
82 Devonshire Street
Boston, Massachusetts 02109
Baron Capital Group, Inc. 3,494,400(3) 7.5%
767 Fifth Avenue
24th Floor
New York, New York 10153
1
<PAGE>
- -------------------------
(1) Includes 15,885,772 shares held by Stein Ventures Limited Partnership
which is 100% controlled by Mr. Stein and 429,450 shares held by the
Jay Stein Foundation Trust over which Mr. Stein has sole voting and
dispositive power as trustee of the Foundation.
(2) According to a Schedule 13G filed February 1, 1999, Fidelity Management
& Research Company ("Fidelity"), a wholly owned subsidiary of FMR Corp.
and an investment advisor registered under Section 203 of the Investment
Advisors Act of 1940 along with Fidelity Management Trust Company, a
wholly-owned subsidiary of FMR Corp. and a bank as defined in Section 3
(a)(6) of the Securities Exchange Act of 1934 are considered "beneficial
owners" in the aggregate of 4,315,700 shares, or 9.5% of shares
outstanding of the Company's common stock, which shares were acquired
for investment purposes by certain advisory clients.
(3) According to the most recent Schedule 13G filed February 17, 1998, Baron
Capital Group, Inc. and Ronald Baron, parent holding companies, in
accordance with Section 240. 13d-1(b) (ii) (G) and BAMCO, Inc. and Baron
Capital Management, Inc., investment advisors registered under Section
203 of the Investment Advisors Act of 1940 along with Baron Asset Fund,
an investment company registered under Section 8 of the Investment
Company Act are considered "beneficial owners" in the aggregate of
3,494,400 shares (reflective of 5/22/98 2-for-1 stock split), or 7.5% of
shares outstanding of the Company's common stock, which shares were
acquired for investment purposes by certain advisory clients.
As of February 26, 1999, all directors and executive officers of the
Company as a group owned beneficially 17,169,222 shares of the Company's common
stock, or 37.4% of the total shares outstanding. In computing the number of
shares owned beneficially by directors and executive officers of the Company as
a group, shares subject to options that are not exercisable within 60 days have
been excluded.
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons owning more than ten
percent of the Company's common stock to file with the Securities and Exchange
Commission initial reports of ownership and reports of changes in ownership of
common stock and other equity securities of the Company and to furnish the
Company with copies of all such reports. To the Company's knowledge, based
solely on review of copies of such reports furnished to the Company, all Section
16(a) filing requirements applicable to its directors, officers and greater than
ten percent beneficial owners have been complied with.
ELECTION OF DIRECTORS
At the meeting, a Board of eight(8) directors will be elected for one
year and until the election and qualification of their successors. Directors
will be elected by a plurality of votes cast by shares entitled to vote at the
meeting. The accompanying proxy will be voted, if authority to do so is not
withheld, for the election as directors of the persons named below who have been
designated by the Board of Directors as nominees. Each nominee is at present
available for election and, with the exception of Ms. Farthing, is a member of
the Board and was elected to the Board by the Company's stockholders. If any
nominee should become unavailable, which is not now anticipated, the persons
voting the accompanying proxy may in their discretion vote for a substitute.
There are no family relationships between any directors or executive officers of
the Company. Information concerning the Board's nominees, based on data
furnished by them, is set forth below.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE
ELECTION OF EACH OF THE FOLLOWING NOMINEES. PROXIES SOLICITED BY THE BOARD WILL
BE SO VOTED UNLESS STOCKHOLDERS SPECIFY IN THEIR PROXIES A CONTRARY CHOICE.
2
<PAGE>
<TABLE>
<CAPTION>
Year Shares of
First Company Common
Positions with the Company; Became Stock Owned
Principal Occupations During Director Beneficially as of
Name Past Five Years; Other of the February 26, 1999
Age Directorships Company(1) (% of Class)(2)
---- ----------------------------- ---------- ------------------
<S> <C> <C> <C>
Jay Stein* Chairman of the Board of 1968 16,333,722(3)
(53) the Company since 1989; (36.0%)
President of the Company
from 1979 to 1990;
director of American
Heritage Life Insurance
Company based in
Jacksonville, Florida and
Promus Hotel
Corporation based in
Memphis, Tennessee
John H. Williams,Jr.* President (since 1990) and 1984 656,000(4)
(61) director of the Company; (1.4%)
Executive Vice President
from 1980 to 1990;
director of SunTrust Bank,
North Florida, N.A. in
Jacksonville, Florida
Alvin R."Pete" Carpenter o Director of the Company; 1996 3,000(5)
(57) President and Chief
Executive Officer of CSX
Transportation, Inc. since
1992; director of American
Heritage Life Insurance
Company, Regency Realty
Corporation and Florida
Rock Industries, Inc.
Albert Ernest, Jr.+o Director of the Company; 1991 55,000(4)(5)
(68) President of Albert Ernest (0.1%)
Enterprises; director of
Florida Rock Industries,
Inc., and its affiliate,
FRP Properties, Inc.,
Virginia National Bank,
Wickes Lumber Company and
Regency Realty Corporation
Linda McFarland Farthing Director nominee of the ____ ____(5)
(51) Company; President &
Director, Friedman's, Inc.
1998; President &
Director, Cato Corporation
1990-1997
Mitchell W. Legler o Director of the Company; 1991 24,000(4)(5)(6)
(56) sole shareholder of (0.1%)
Mitchell W. Legler, P.A., general
counsel to the Company since 1991;
partner of Foley & Lardner from 1991
to 1995; director of IMC Mortgage
Company
3
<PAGE>
Year Shares of
First Company Common
Positions with the Company; Became Stock Owned
Principal Occupations During Director Beneficially as of
Name Past Five Years; Other of the February 26, 1999
Age Directorships Company(1) (% of Class)(2)
---- ----------------------------- ---------- ------------------
Michael D. Rose+ Director of the Company; 1997 40,000(5)
(56) Chairman of Promus Hotel (0.1%)
Corporation from 1995 to December
1997; Chairman of Harrah's
Entertainment, Inc. from 1995 to
January 1997; Chairman of The Promus
Companies, Incorporated from 1990 to
1995; Chief Executive Officer of The
Promus Companies, Incorporated from
1990 to 1994; director of Ashland,
Inc., Darden Restaurants, Inc., First
Tennessee National Corporation,
General Mills, Inc., Felcor Lodging
Trust, Inc., ResortQuest
International, Inc., and Nextera
Enterprises, LLC
James H. Winston+o Director of the Company; 1991 57,500(4)(5)(7)
(65) Chairman of LPMC, a real (0.1%)
estate investment firm
based in Jacksonville,
Florida, since 1979;
President of Omega
Insurance Company, Citadel
Life & Health Insurance
Company and Wellington
Investments since 1983;
director of FRP
Properties, Inc. and
Winston Hotels
- ------------------------
<FN>
* Member of the Executive Committee, any meeting of which also must include
any one of the outside directors.
+ Member of the Audit Committee.
o Member of the Compensation Committee.
(1) Directors are elected for one-year terms.
(2) Where percentage is not indicated, amount is less than 0.1% of total
outstanding common stock. Unless otherwise noted, all shares are owned
directly, with sole voting and dispositive powers. Excludes shares subject
to options that are not exercisable within 60 days.
(3) Includes 15,885,772 shares held by Stein Ventures Limited Partnership
which is 100% controlled by Mr. Stein and 429,450 shares held by the
Jay Stein Foundation Trust over which Mr. Stein has sole voting and
dispositive power as trustee of the Foundation.
(4) Includes the following shares which are not currently outstanding but
which the named holders are entitled to receive upon exercise of
options:
John H. Williams, Jr 590,000
Albert Ernest, Jr. 12,000
Mitchell W. Legler 12,000
James H. Winston 12,000
4
<PAGE>
The shares described in this note are deemed to be outstanding for the
purpose of computing the percentage of outstanding Common Stock owned
by each named individual and by the group, but are not deemed to be
outstanding for the purpose of computing the percentage ownership of
any other person.
(5) Each outside director receives non-qualified options to purchase 4,000
shares of common stock of the Company. Options that are exercisable
within 60 days are included in the shares indicated.
(6) These shares are owned by Mr. Legler and his wife as tenants by the
entirety.
(7) Includes 20,400 shares owned through corporations of which Mr. Winston
is the sole stockholder.
</FN>
</TABLE>
EXECUTIVE OFFICERS
The executive officers of the Company are:
Jay Stein Chairman and Chief Executive Officer
John H. Williams, Jr. President and Chief Operating
Officer
Michael D. Fisher Executive Vice President, Stores
Michael Remsen Executive Vice President,
Merchandising
James G. Delfs Senior Vice President, Finance and
Chief Financial Officer
For additional information regarding Messrs. Stein and Williams see the
Directors' table on the preceding pages.
Mr. Fisher joined the Company in August, 1993 as Executive Vice President,
Stores. From 1988 to 1993, Mr. Fisher was Senior Vice President of Stores for
Millers Outpost, Inc., a California based chain of apparel stores.
Mr. Remsen joined the Company in February, 1992 and served as General
Merchandising Manager over the ladies' sportswear, children's and intimate
apparel divisions prior to his promotion to Executive Vice President,
Merchandising effective August 1, 1997. From 1987 to 1992, Mr. Remsen was with
Macy's West where he served as Vice President, Merchandise Administrator for
girls, infants and toddlers upon his arrival in 1987 and was later given the
additional responsibility for boys. In 1990, he was named Administrator for
moderate sportswear.
Mr. Delfs joined the Company in May, 1995 as Senior Vice President,
Finance and Chief Financial Officer. From 1993 to 1994 he was Vice President,
Chief Financial Officer for Helzberg's Diamond Shops, Inc., a chain of jewelry
stores and from 1988 to 1992 he was Vice President, Chief Financial Officer for
Abercrombie & Fitch, Inc., a division of The Limited, Inc.
BOARD OF DIRECTORS AND STANDING COMMITTEES
Regular meetings of the Board of Directors are held four times a year,
normally in the first month of each quarter. During 1998, the Board held a total
of four regular meetings. All directors attended at least 75% of all meetings of
the Board and Board committees on which they served during 1998.
5
<PAGE>
The Board of Directors has established three standing committees: an
Executive Committee, an Audit Committee and a Compensation Committee, which are
described below. Members of these committees are elected annually at the regular
Board meeting held in conjunction with the annual stockholders' meeting. The
Board of Directors presently does not have a nominating committee.
EXECUTIVE COMITTEE. The Executive Committee is comprised of Messrs.
Stein (Chairman) and Williams, plus any one outside director. Subject to the
limitations specified by the Florida Business Corporation Act, the Executive
Committee is authorized by the Company's bylaws to exercise all of the powers of
the Board of Directors when the Board of Directors is not in session. The
Executive Committee held no meetings during 1998.
AUDIT COMITTEE. The Audit Committee is comprised of Messrs. Winston
(Chairman), Ernest and Rose, none of whom is an officer of the Company. Regular
meetings of the Audit Committee are held twice a year, with one meeting
scheduled in conjunction with the annual stockholders' meeting. During 1998, the
Audit Committee held two meetings. The principal responsibilities of and
functions generally performed by the Audit Committee are reviewing the Company's
internal controls and the objectivity of its financial reporting, making
recommendations regarding the Company's employment of independent auditors, and
reviewing the annual audit with the auditors.
COMPENSATION COMITTEE. The Compensation Committee is comprised of
Messrs. Carpenter (Chairman), Ernest, Legler and Winston. The Compensation
Committee generally holds four regular meetings per year. During 1998, the
Compensation Committee held four meetings. This Committee has the responsibility
for approving the compensation arrangements for senior management of the
Company, including annual bonus compensation. It also recommends to the Board of
Directors, adoption of any compensation plans in which officers and directors of
the Company are eligible to participate. The Compensation Committee also serves
as the Option Committee and makes grants of stock options under the Company's
Employee Stock Plan.
COMPENSATION COMMITTEE REPORT TO SHAREHOLDERS
COMPENSATION PHILOSOPHY
The Compensation Committee believes that the Company should continue to
emphasize its philosophy of rewarding performance within the Company, and of
encouraging a long-term view by all the Company's officers and other managerial
personnel.
The Company's 1998 fiscal year was a disappointment, with the Company
reporting pre-tax income of $33.1 million compared to $57 million for the prior
year, resulting in diluted earnings per share of $0.44 versus $0.73 for the
prior year.
While the bonus formulas for many of the Company's officers were driven
by applying quantitative factors which the Company believed would positively
impact the profitability of the Company, the bonuses for the Company's Chief
Executive Officer and Chief Operating Officer were not formula driven, but
subject to the discretion of the Compensation Committee. The Committee
6
<PAGE>
believed that the Company's disappointing performance for the current year
should be taken into effect when applying those bonuses.
EMPLOYEE STOCK OWNERSHIP
The Compensation Committee determined that the Company's philosophy on
focusing on long-term value through the grant of stock options and involving
employees in direct ownership of the Company's shares would contribute
materially to the Company's success in the long run. The Compensation Committee
noted the Company's stock option plans and Employee Stock Purchase Plan continue
to achieve an alignment of the interests of key employees with the Company's
stockholders, and continue to provide a meaningful incentive for key employees
to remain with the Company.
SENIOR EXECUTIVES
In view of the Company's disappointing results for 1998, the Committee
determined that base compensation increases for the Company Chief Executive
Officer and Chief Operating Officer should be very modest, in the 3% range, and
that their bonuses should reflect the disappointing year. Accordingly, the
Committee determined:
1. Jay Stein, Chairman and Chief Executive Officer, was awarded an
increase of $14,000, increasing his salary to $464,000 per year (compared to an
increase of $45,000 awarded for the prior year). The Committee also accepted Mr.
Stein's proposal that he receive no bonus for the year in view of the Company's
disappointing performance compared to the $200,000 bonus which he had received
the prior year.
2. John H. Williams, Jr., the Company's President and Chief Operating
Officer, was awarded an increase of $14,000, increasing his salary to $454,000
per year (compared to a $45,000 increase for the prior year). The Committee
believed that Mr. Williams had performed well in connection with one of his
major areas of responsibility, that of expense management, during the year, but
had not achieved the desired results in the other major area of his
responsibility, that of merchandising. Accordingly, the Committee determined
that a bonus of $100,000 was appropriate, which was one-half of the $200,000
bonus awarded the prior year.
3. Michael D. Fisher, the Company's Executive Vice President, Stores,
received an increase in base salary of $10,000, constituting a 4.2% increase,
bringing his total compensation to $250,000. His bonus was based on a formula
driven by applying certain quantitative factors, and the application of that
formula gave rise to a bonus of $48,800 for the year.
4. Michael Remsen, the Company's Executive Vice President,
Merchandising, received an increase in base salary of $7,000, constituting a
3.1% increase, bringing his total compensation to $232,000. His bonus was based
on a formula driven by applying certain quantitative factors, and the
application of that formula gave rise to a bonus of $15,125 for the year.
7
<PAGE>
5. James G. Delfs, the Company's Chief Financial Officer, received an
increase in base salary of $8,000, constituting a 4.8% increase, bringing his
total compensation to $173,000. In addition, the Committee approved management's
recommendation of a bonus of $36,000.
LONG-TERM INCENTIVE COMPENSATION
The Company has in effect Stock Option and Employee Stock Purchase
Plans for the Company's employees. The Compensation Committee believes that
these plans are a principal vehicle for motivating management to work toward
long-term growth in stockholder value. Consistent with the Company's philosophy
of providing incentives to key employees at all levels, options are awarded to a
relatively broad base of employees, down through store managers. Options have
been awarded based on positions within the Company, ability to contribute to the
Company's profitability, and prior tenure with the Company. For additional
information as to the options held by executive officers, see the Option
Exercises and Year-End Values Table under "Executive Compensation".
The employee stock options reflect the Company's philosophy that
officers' and employees' incentive compensation should reflect the same
long-term interests as the Company's shareholders. To encourage continued
service with the Company, the options become exercisable ratably on the third,
fourth and fifth anniversary dates of grant. Additional increases in the value
of the Company's common stock, which benefit all shareholders, will best serve
as the primary incentive to its executive officers.
CEO COMPENSATION
The Compensation Committee's policies with respect to the Chief
Executive Officer, Jay Stein, were the same as for the Company's other executive
officers except that the application of the Company's bottom-up compensation
philosophy resulted in the compensation of the Chief Executive Officer being
conservative when compared to the Chief Executive Officers of other companies
with similar sales in the retail industry. However, in view of Jay Stein's
continuing substantial ownership of shares of the Company's common stock, the
Committee believed that Mr. Stein's primary motivation remained that of stock
ownership which is most aligned with the interest of other shareholders of the
Company and that conservative compensation continued to be appropriate under the
circumstances.
CERTAIN TAX MATTERS
Section 162(m) of the Internal Revenue Code, enacted in 1993, precludes
a public corporation from deducting compensation of more than $1 million each,
for its chief executive officer or for any of its four other highest paid
officers. Certain performance-based compensation is exempt from this limitation.
Compensation in the form of options under the Company's Employee Stock Plan is
exempt. Because other forms of compensation to the Company's officers are
nowhere near $1 million, the Compensation Committee does not presently have a
policy regarding whether it would authorize compensation that would not be
deductible for the Company for federal income tax purposes by reason of Section
162(m).
STEIN MART, INC.
COMPENSATION COMMITTEE
Alvin R. "Pete" Carpenter, Chairman
Albert Ernest, Jr.
Mitchell W. Legler
James H. Winston
8
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes the compensation paid or accrued by the
Company for services rendered during the years indicated to each of the
Company's executive officers whose total salary and bonus exceeded $100,000
during the year ended January 2, 1999. The Company did not grant any restricted
stock awards or stock appreciation rights or make any long-term incentive plan
payouts during the years indicated.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-Term
Annual Compensation Compensation
---------------------------------------------------------------- --------------
Name And Other Number
Principal Annual Of All Other
Position Year Salary (1) Bonus Compensation Options Compensation (2)
- ------------------------- ------- -------------- -------------- -------------- -------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Jay Stein 1998 $446,250 $ 0 (3) ---- $1,600
Chairman & Chief 1997 402,500 200,000 (3) ---- 4,140
Executive Officer 1996 372,917 150,000 (3) ---- 4,784
John H. Williams, Jr. 1998 $436,250 $100,000 (3) ---- $1,600
President & Chief 1997 392,500 200,000 (3) 600,000 4,140
Operating Officer 1996 361,667 150,000 (3) ---- 4,784
Michael D. Fisher 1998 $238,333 $ 48,800 (3) ---- $1,600
Executive Vice 1997 204,375 100,000 (3) 200,000 4,140
President, Stores 1996 185,625 85,000 (3) ---- 4,009
Michael Remsen 1998 $223,750 $ 15,125 (3) ---- $1,600
Executive Vice 1997(4) 166,667 74,375 (3) 210,000 4,140
President,
Merchandising
James G. Delfs 1998 $165,000 $ 36,000 $38,009(5) ---- $1,600
Senior Vice President, 1997 146,667 45,000 47,657(5) 100,000 4,140
Finance & Chief Financial 1996 138,893 35,000 26,720(5) ---- 2,271
Officer
</TABLE>
(1) Includes amounts deferred under the 401(k) features of the Company's profit
sharing plan.
(2) The Company has not yet made a contribution to its profit sharing plan for
1998, and accordingly, it is not possible as of the date of this Proxy
Statement to determine the amount of Company contributions that will be
allocated to the accounts of the named executives for 1998. The amounts
shown for 1998 represent matching contributions made by the Company in 1998
for voluntary contributions made by the named executives. The amounts
shown for 1997 include a base contribution of $1,600 and a matching
contribution of $1,600 made by the Company to the 401(k) portion of the
plan for voluntary contributions made as well as $940 to the Profit
Sharing plan for Messers. Stein, Williams, Fisher, Remsen and Delfs.
The amounts shown for 1996 include a base contribution of $1,500 for
Messrs. Stein, Williams and Fisher and $679 for Mr. Delfs and a
discretionary contribution of $909 to the Profit Sharing plan for Messrs.
Stein, Williams, Fisher and Delfs as well as matching contributions
made by the Company to the 401(k) portion of the plan for voluntary
contributions made of $2,375 for Messrs. Stein and Williams, $1,600 for
Mr. Fisher and $683 for Mr. Delfs.
(3) Excludes certain personal benefits, the total value of which was the lesser
of $50,000 or ten percent of the total annual salary and bonus for each of
the named executives.
(4) Mr. Remsen became Executive Vice President, Merchandising effective August
1, 1997. The amounts shown for 1997 represent totals for the entire year
of 1997.
(5) The amount shown for 1998 includes $25,576 medical claims, $10,800
automobile allowance and $1,633 miscellaneous. The amount shown for
1997 includes $35,441 medical claims, $10,800 automobile allowance and
$1,416 miscellaneous. The amount shown for 1996 includes $4,512 medical
claims, $4,751 personal use of company automobile, $16,073 moving expense
reimbursement and $1,384 miscellaneous.
9
<PAGE>
Options. None of the executive officers named in the "Summary
Compensation Table" received any stock options or stock appreciation rights
during the year ended January 2, 1999.
The following table sets forth information concerning stock options
exercised by the named executives during the year ended January 2, 1999 and the
number and value of unexercised options as of January 2, 1999 held by the named
executives in the Summary Compensation Table above.
<TABLE>
<CAPTION>
OPTION EXERCISES AND YEAR-END VALUES TABLE
Value of Unexercised
Number of Unexercised In-the-Money
Shares Options at January 2, 1999 Options at January 2, 1999
Acquired (#) ($)(2)
on Value ---------------------------------------------------------------------
Exercise Realized
Name (#) ($)(1) Exercisable Unexercisable Exercisable Unexercisable
- --------------- --------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Jay Stein,
Chairman &
Chief Executive Not Not Not
Officer 0 Applicable None None Applicable Applicable
John H.
Williams, Jr.,
President &
Chief Operating
Officer 60,000 $433,700 590,000 600,000 $1,940,023 $ 0
Michael D.
Fisher,
Executive Vice
President,
Stores 20,000 $175,850 73,000 227,000 $ 8,250 $16,749
Michael Remsen,
Executive Vice
President,
Merchandising 7,920 $ 81,675 6,600 239,480 $ 8,250 $23,282
James G. Delfs,
Senior Vice
President,
Finance & Chief
Financial Not
Officer 0 Applicable 16,500 133,500 $ 20,315 $41,246
</TABLE>
- ---------------------
(1) Value realized is calculated based on the difference between the option
exercise price and the market price of the Company's Common Stock on
the date of exercise multiplied by the number of shares to which the
exercise relates.
(2) Value of unexercised in-the-money options is calculated based on the
difference between the option exercise price and the closing price of
the Company's Common Stock at December 31, 1998, multiplied by the
number of shares underlying the options. The closing price on December
31, 1998 of the Company's Common Stock as reported on The Nasdaq Stock
Market (service mark) was $6.9688.
COMPENSATION OF DIRECTORS. The outside directors receive director's
fees of $12,000 per year, plus $2,000 for each meeting of the Board and $1,500
for any committee thereof which they attend, and are reimbursed for
out-of-pocket expenses incurred in connection with attending meetings. Pursuant
to the Company's director stock option plan, each outside director receives
non-qualified options to purchase 4,000 shares of common stock of the Company
upon becoming a director. Approximately one-third of the options become
exercisable on each of the third, fourth and fifth anniversary dates of grant
at an exercise price equal to the fair market value of the common stock on the
date of grant. A total of 84,000 shares is reserved for issuance under this
plan.
10
<PAGE>
CERTAIN TRANSACTIONS; COMPENSATION COMMITTEE INTERLOCKS AND INSIDER
PARTICIPATION
The Audit Committee of the Board of Directors is responsible for
evaluating the appropriateness of all related-party transactions.
Set forth below are various transactions involving the Company and
members of the Compensation Committee of the Board of Directors or their related
parties. The Board of Directors does not believe that the relationships and
transactions described below regarding members of the Compensation Committee
adversely affect the performance by the committee of its duties.
Mr. Legler. Mr. Legler is the sole shareholder of the law firm of
Mitchell W. Legler, P.A., which serves as general counsel to the Company. Legal
fees received by that firm from the Company were $42,000 for 1998.
COMPARATIVE STOCK PERFORMANCE
The following graph compares the cumulative total stockholder return on
the Company's common stock with the cumulative total return on The Nasdaq Stock
Market [service mark] (U.S.) Index and The Nasdaq Stock Market [service mark]
Retail Trades Stock Index for the last five years ended January 2, 1999. The
comparison assumes $100 was invested at the beginning of the five year period in
Stein Mart, Inc. stock and in each of the indices shown and assumes reinvestment
of any dividends.
COMPARISON OF CUMULATIVE TOTAL RETURN AMONG
STEIN MART, INC., THE NASDAQ STOCK MARKET [SERVICE MARK} (U.S.) INDEX
AND THE NASDAQ STOCK MARKET [SERVICE MARK] RETAIL TRADES STOCK INDEX
=========================================================
Stein Mart, Nasdaq Nasdaq
Date Inc. (U.S.) Retail
================================================================================
12/31/93 100.0 100.0 100.0
12/31/94 66.2 97.8 91.2
12/30/95 57.1 138.3 100.4
12/28/96 101.6 170.2 120.0
01/03/98 132.5 209.7 140.0
01/02/99 72.4 293.5 171.0
================================================================================
11
<PAGE>
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Company has not selected a firm to serve as the independent
certified public accountants for the Company for the current fiscal year ending
January 1, 2000. The Company is reviewing proposals for the work to be completed
for the upcoming year. PricewaterhouseCoopers LLP has served as the auditor for
the Company since 1983. Representatives of PricewaterhouseCoopers LLP are
expected to be present at the annual meeting of stockholders and will be
accorded the opportunity to make a statement, if they so desire, and to respond
to appropriate questions.
OTHER MATTERS
The Board of Directors does not know of any other matters to come
before the meeting; however, if any other matters properly come before the
meeting it is the intention of the persons designated as proxies to vote in
accordance with their best judgment on such matters. If any other matter should
come before the meeting, action on such matter will be approved if the number of
votes cast in favor of the matter exceeds the number opposed.
STOCKHOLDER PROPOSALS
Regulations of the Securities and Exchange Commission require proxy
statements to disclose the date by which stockholder proposals must be received
by the Company in order to be included in the Company's proxy materials for the
next annual meeting. In accordance with these regulations, stockholders are
hereby notified that if they wish a proposal to be included in the Company's
proxy statement and form of proxy relating to the 2000 annual meeting, a written
copy of their proposal must be received at the principal executive offices of
the Company no later than December 10, 1999. To ensure prompt receipt by the
Company, proposals should be sent certified mail return receipt requested.
Proposals must comply with the proxy rules relating to stockholder proposals in
order to be included in the Company's proxy materials.
ANNUAL REPORT
A copy of the Company's Annual Report for the year ended January 2,
1999 accompanies this proxy statement. Additional copies may be obtained by
writing to Ms. Susan Datz Edelman, the Company's Director of Stockholder
Relations, at 1200 Riverplace Boulevard, Jacksonville, Florida 32207.
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. The
Company does not expect to pay any compensation for the solicitation of proxies
but may reimburse brokers and other persons holding stock in their names, or in
the names of nominees, for their expenses for sending proxy material to
principals and obtaining their proxies.
Dated: April 9, 1999.
STOCKHOLDERS ARE URGED TO SPECIFY THEIR CHOICES, DATE, SIGN AND RETURN
THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE, POSTAGE FOR WHICH HAS BEEN
PROVIDED. YOUR PROMPT RESPONSE WILL BE APPRECIATED.
12
<PAGE>
STEIN MART, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS IN CONNECTION WITH
THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 17, 1999
The undersigned hereby appoints Jay Stein and John H. Williams, Jr.,
and each of them, with full power of substitution and revocation, as true and
lawful agents and proxies of the undersigned to attend and vote all shares of
Common Stock of Stein Mart, Inc., a Florida corporation, that the undersigned
would be entitled to vote if then personally present at the Annual Meeting of
Shareholders of Stein Mart, Inc., a Florida corporation, to be held on May 17,
1999 at 2:00 P.M., local time, at The Cummer Museum of Art and Gardens, 829
Riverside Avenue, Jacksonville, Florida, and at any adjournment or
adjournments thereof, hereby revoking any proxy heretofore given.
(Continued and to be signed on the reverse side)
FOLD AND DETACH HERE
13
<PAGE>
<TABLE>
<CAPTION>
This Proxy when properly executed will be voted in the manner directed herein by the undersigned shareholder. Please mark [x]
If no direction is made, this proxy will be voted FOR Proposal 1. The Board of Directors recommends a vote your votes as
FOR item 1. indicated in
this example
<S> <C>
1. Election of Directors as recommended in the Proxy Statement: Alvin R. "Pete" Carpenter, Albert Ernest, Jr., Linda McFarland
Farthing, Mitchell W. Legler, Michael D. Rose, Jay Stein, John H.
Williams, Jr. and James H. Winston
FOR all WITHHOLD
nominees AUTHORITY
listed (except to vote for
as marked to all nominees INSTRUCTIONS: To withhold authority to vote for any individual nominee, write that nominee's name
the contrary) listed in the space provided below.
[ ] [ ] -----------------------------------------------------------------------------------
2. Should any other matters requiring a vote of the shareholders
arise, the above named proxies are authorized to vote the same in
accordance with their best judgment in the interest of the
Company. The Board of Directors is not aware of any matter which
is to be presented for action at the meeting other than the matters
set forth herein.
Please insert the date and sign your name exactly as it appears hereon.
If shares are held jointly each joint owner should sign. Executors,
administrators, trustees, guardians, etc., should so indicate when signing.
Corporations should sign full corporate name by an authorized officer.
Partnership should sign partnership name by an authorized Partner.
Unless the date has been inserted below, this Proxy shall be deemed to be
dated for all purposes as of the date appearing on the postmark on the
envelope in which it is enclosed. In such a case the Proxies named above
are authorized to insert the date inaccordance with these instructions.
Dated:--------------------------------------------------------------, 1999
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Signature(s) of Shareholder(s)
</TABLE>
"PLEASE MARK INSIDE BOXES SO THAT DATA
PROCESSING EQUIPMENT WILL RECORD YOUR VOTES"
14
<PAGE>
o FOLD AND DETACH HERE o
[Stein Mart. Logo]
Several Company information delivery options are now offered to shareholders.
Quarterly information is available immediately on the day of announcement via
any of the methods below. Please use the method most convenient for you.
1) Fax: Call 1-800-239-0927 and enter your fax number to get the latest news
release(s) faxed directly to you at no charge.
2) Computer: Visit the Stein Mart (www.steinmart.com) web site for latest news
release(s) and accompanying financial statements. You can also e-mail smrt@
steinmart.com to reach the investor relations area.
3) Call (904)346-1535 ext.5888. You may choose to listen to a recorded version
of the news release OR you may request information to be mailed to you
directly. If you would like to continue to have information mailed each
reporting period, ask to be placed on Stein Mart's mailing list.
Reporting dates for 1999:
April 27, 1999: Stein Mart 1Q '99 Financial Results News Release
July 27, 1999: Stein Mart 2Q '99 Financial Results News Release
October 26, 1999: Stein Mart 3Q '99 Financial Results News Release
February 29, 2000: Stein Mart FY '99 Financial Results News Release
15
