SCHEDULE 14A INFORMATION
Consent 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 by Commission only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Materials Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
Today's Man, Inc.
---------------------------------------
Name of Registrant Specified in Charter
Today's Man, Inc.
---------------------------------------
Name of Person Filing Proxy Statement
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
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4) Proposed maximum aggregate value of transaction:
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[ ] 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>
TODAY'S MAN, INC.
835 LANCER DRIVE
MOORESTOWN, NEW JERSEY 08057
------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 23, 1999
------------------
To the Shareholders of Today's Man, Inc.:
The 1999 Annual Meeting of Shareholders of Today's Man, Inc. will be held
on June 23, 1999, at 10:00 a.m., prevailing time, at the offices of the Company,
835 Lancer Drive, Moorestown, New Jersey, for the purpose of considering and
acting upon the following:
1. To elect two Class II directors to hold office for a term of four years
and until their respective successors are duly elected and qualified, as more
fully described in the accompanying Proxy Statement; and
2. To transact such other business as may properly come before the Annual
Meeting.
Only shareholders of record at the close of business on April 30, 1999, are
entitled to notice of, and to vote at, the Annual Meeting or any adjournment or
postponement thereof.
If the Annual Meeting is adjourned for one or more periods aggregating at
least 15 days because of the absence of a quorum, those shareholders entitled to
vote who attend the reconvened Annual Meeting, if less than a quorum as
determined under applicable law, shall nevertheless constitute a quorum for the
purpose of acting upon any matter set forth in this Notice of Annual Meeting.
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. WHETHER
OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, YOU ARE URGED TO SIGN,
DATE AND PROMPTLY RETURN THE ENCLOSED PROXY CARD. A SELF-ADDRESSED ENVELOPE IS
ENCLOSED FOR YOUR CONVENIENCE; NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES.
By Order of the Board of Directors
/s/ LARRY FELD
LARRY FELD
Vice President and Secretary
Moorestown, New Jersey
May 21, 1999
<PAGE>
TODAY'S MAN, INC.
835 LANCER DRIVE
MOORESTOWN, NEW JERSEY 08057
(609) 235-5656
------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
------------------
The accompanying proxy is solicited by the Board of Directors of Today's
Man, Inc. (the "Company") for use at the 1999 Annual Meeting of Shareholders
(the "Meeting") to be held on June 23, 1999 at 10:00, prevailing time, at the
offices of the Company, 835 Lancer Drive, Moorestown, New Jersey, and any
adjournments or postponements thereof. This Proxy Statement and accompanying
proxy card are first being mailed to shareholders on or about May 21, 1999.
The cost of this solicitation will be borne by the Company. In addition to
solicitation by mail, proxies may be solicited in person or by telephone,
telegraph or teletype by officers, directors or employees of the Company,
without additional compensation. Upon request, the Company will pay the
reasonable expenses incurred by record holders of the Company's Common Stock who
are brokers, dealers, banks or voting trustees, or their nominees, for mailing
proxy material and annual shareholder reports to the beneficial owners of the
shares they hold of record.
Only shareholders of record, as shown on the transfer books of the Company,
at the close of business on April 30, 1999 (the "Record Date") are entitled to
notice of, and to vote at, the Meeting. On the Record Date, there were
27,014,485 shares of Common Stock outstanding.
Proxies in the form enclosed, if properly executed and received in time for
voting, and not revoked, will be voted as directed on the proxies. If no
directions to the contrary are indicated, the persons named in the enclosed
proxy will vote all shares of Common Stock "for" the election of the nominees
for director hereinafter named. Sending in a signed proxy will not affect a
shareholder's right to attend the Meeting and vote in person since the proxy is
revocable. Any shareholder who submits a proxy has the power to revoke it by,
among other methods, giving written notice to the Secretary of the Company at
any time before the proxy is voted.
The presence, in person or represented by proxy, of the holders of a
majority of the outstanding shares of Common Stock will constitute a quorum for
the transaction of business at the Meeting. All shares of the Company's Common
Stock present in person or represented by proxy and entitled to vote at the
Meeting, no matter how they are voted or whether they abstain from voting, will
be counted in determining the presence of a quorum. If the Meeting is adjourned
because of the absence of a quorum, those shareholders entitled to vote who
attend the adjourned meeting, although constituting less than a quorum as
provided herein, shall nevertheless constitute a quorum for the purpose of
electing directors. If the Meeting is adjourned for one or more periods
aggregating at least 15 days because of the absence of a quorum, those
shareholders entitled to vote who attend the reconvened Meeting, if less than a
quorum as determined under applicable law, shall nevertheless constitute a
quorum for the purpose of acting upon any matter set forth in the Notice of
Annual Meeting.
Each share of Common Stock is entitled to one vote on each matter which may
be brought before the Meeting. The election of directors will be determined by a
plurality vote and the nominees receiving the most "for" votes will be elected.
Approval of any other proposal will require the affirmative vote of a majority
of the shares cast on the proposal. Under the Pennsylvania Business Corporation
Law, an abstention, withholding of authority to vote or broker non-vote will not
have the same legal effect as an "against" vote and will not be counted in
determining whether the proposal has received the required shareholder vote.
As used in this Proxy Statement, "fiscal 1993," "fiscal 1994," "fiscal
1995," "fiscal 1996," "fiscal 1997," "fiscal 1998" and "fiscal 1999" refer to
the Company's fiscal years ended or ending January 29, 1994, January 28, 1995,
February 3, 1996, February 1, 1997, January 31, 1998, January 30, 1999 and
January 29, 2000, respectively.
1
<PAGE>
ELECTION OF DIRECTORS
The Company's Amended and Restated Articles of Incorporation provide that
the Board of Directors shall consist of not less than four and not more than
fifteen directors, with the exact number fixed by the Board of Directors. The
Board has fixed the number of directors at seven.
At the Meeting, shareholders will elect two Class II directors to serve for
a term of four years and until their respective successors are elected and
qualified. Unless directed otherwise, the persons named in the enclosed proxy
intend to vote such proxy "for" the election of the listed nominees or, in the
event of inability of one or both of the nominees to serve for any reason, for
the election of such other person or persons as the Board of Directors may
designate to fill such vacancy. The Board has no reason to believe that the
nominees will not be candidates or will be unable to serve.
The following table sets forth information, as of the Record Date,
concerning the Company's directors and nominees for election to the Board of
Directors. Mr. Larry Feld and Ms. Verna Gibson, the director nominees, were
nominated by the Board of Directors and currently serve as directors. The
nominees have consented to being named in the Proxy Statement and to serve if
elected.
<TABLE>
<CAPTION>
DIRECTOR TERM
NAME AGE POSITION SINCE EXPIRES
---- --- -------- ----- -------
<S> <C> <C> <C> <C>
David Feld .......................... 51 Chairman of the Board, President and 1971 2001
Chief Executive Officer
Leonard Wasserman ................... 73 Executive Vice President and Director 1992 2002
Larry Feld (1) ...................... 48 Vice President, Store Development, 1971 1999
Secretary and Director
Ira Brind (2)(3) .................... 58 Director 1992 2000
Verna K. Gibson (1)(2) .............. 56 Director 1992 1999
Bernard J. Korman (3) ............... 67 Director 1992 2000
Randall Lambert (3) ................. 41 Director 1998 2001
</TABLE>
- ------------------
(1) Nominee for Director.
(2) Member of the Compensation Committee.
(3) Member of the Audit Committee.
The following information about the Company's directors and nominees for
director is based, in part, upon information supplied by such persons.
Mr. David Feld has been with the Company continuously since he founded it
in 1971. He grew up in his family's retail business and opened the Company's
first store in Philadelphia in 1971. Mr. David Feld has served as Chairman of
the Board and Chief Executive Officer of the Company since its inception and,
except for the period from March 1995 until July 1995, also has served as
President of the Company. On February 2, 1996, Mr. Feld filed a voluntary
petition to reorganize under Chapter 11 of the United States Bankruptcy Code. On
August 13, 1997, the United States Bankruptcy Court for the District of New
Jersey confirmed Mr. Feld's Chapter 11 Plan.
Mr. Wasserman joined the Company in 1983 as a consultant to assist in
strategic planning and marketing development and was appointed to the Office of
the President in 1991 and a director in 1992. Mr. Wasserman was named Executive
Vice President in 1995. Between 1982 and 1983, Mr. Wasserman was President and
Chief Executive Officer of the Lionel Corporation and, prior thereto, was
President of its Kiddie City Division for 11 years. Mr. Wasserman founded Kiddie
City in 1957.
Mr. Larry Feld has served as Vice President, Store Development since 1983
and as a Vice President, Secretary and Director of the Company since its
inception in 1971. Messrs. David Feld and Larry Feld are brothers.
Mr. Brind is President and a shareholder principal of Brind-Lindsay & Co.,
Inc., a management and consulting firm in Philadelphia. Until 1987, Mr. Brind
was President, Chief Executive Officer and a Director of McDonnell Douglas Truck
Services, Inc., a full service truck lessor and transportation services
subsidiary of McDonnell Douglas Corporation.
2
<PAGE>
Mrs. Gibson is an active partner in Retail Options, Inc., a consulting firm
formed in 1993. Mrs. Gibson has been an independent retail consultant since 1991
and provided consulting services to the Company, among others, in fiscal 1992,
fiscal 1993 and fiscal 1994. From 1985 to 1991, Mrs. Gibson was President and
Chief Executive Officer of the Limited Stores, Inc., which she joined as a
trainee in 1971. From December 1994 to 1996, Mrs. Gibson served as Chairman of
the Board of Petrie Retail, Inc. Mrs. Gibson is a director of MothersWork, Inc.
and Chicos FAS, Inc. Petrie Retail filed a voluntary petition to reorganize
under Chapter 11 of the United States Bankruptcy Code in October 1995.
Mr. Korman has been Chairman of the Board of Philadelphia Health Care
Trust, since 1997. From 1996 to 1997 Mr. Korman was Chairman of the Board of
Graduate Health System, Inc., a not-for-profit healthcare system. From 1980 to
1995, Mr. Korman was President, Chief Executive Officer and a director of MEDIQ
Incorporated, a healthcare services and equipment company located in Pennsauken,
New Jersey. Mr. Korman is also a director of NutraMax Products, Inc., The Pep
Boys--Manny, Moe & Jack, Omega Healthcare Investors, Inc., Omega Worldwide,
Inc., the New America High Income Fund, Inc., InnoServe Technologies, Inc., and
Kranzco Realty Trust.
Mr. Lambert is a Managing Director of Chanin Kirkland Messina LLC, a
merchant banking and investment banking/financial advisory firm located in Los
Angeles and New York. From 1995 to 1997, Mr. Lambert was Managing Director of
private transactions at BDS Securities, LLC in New York. From 1987 to 1995, Mr.
Lambert was Vice President of Brian M. Freeman Enterprises. Mr. Lambert was a
certified public accountant with Ernst & Young in Chicago and Price Waterhouse
in Africa. Mr. Lambert is also a Chartered Financial Analyst. Since August 1997,
Mr. Lambert has served as a director of Weiner's Stores, Inc.
BOARD OF DIRECTORS, COMMITTEES AND ATTENDANCE AT MEETINGS
The Board of Directors held seven meetings during fiscal 1998. Each
director attended 75% or more of the meetings of the Board and committees of
which they were members during fiscal 1998, except Mr. Lambert.
The Board of Directors has appointed a Compensation Committee to review and
make recommendations to the Board regarding compensation of executive officers.
The Compensation Committee also administers the Company's Management Stock
Option Plan. During fiscal 1998, the Compensation Committee held one meeting.
The Board of Directors also has appointed an Audit Committee to, among
other things, review the Company's financial and accounting practices and
policies and the scope and results of the Company's annual audit. The Audit
Committee also recommends to the Board the selection of the Company's
independent public auditors. The Audit Committee held two meetings during fiscal
1998.
The Board of Directors has not appointed a standing Nominating Committee.
See "Shareholder Proposals" for information concerning the nomination of
directors for election.
DIRECTOR COMPENSATION
Each director of the Company who is not also an employee receives an annual
fee of $5,000 and a fee of $1,000 for each meeting of the Board or any committee
of the Board attended, plus reimbursement of expenses incurred in attending
meetings. All directors, including non-employee directors, are entitled to
receive options under the Management Stock Option Plan. In fiscal 1998, no
options were granted.
3
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth as of the Record Date certain information
with respect to the beneficial ownership of the Common Stock (i) by each person
who is known by the Company to be the beneficial owner of more than 5% of the
Common Stock, (ii) by each director of the Company, (iii) by each executive
officer of the Company named in the Summary Compensation Table and (iv) by all
directors and executive officers of the Company as a group. Except as otherwise
indicated, the beneficial owners of the Common Stock listed below have sole
investment and voting power with respect to such shares.
<TABLE>
<CAPTION>
SHARES
BENEFICIALLY OWNED (1)
----------------------
NUMBER PERCENT
------ -------
<S> <C> <C> <C>
David Feld (2) ......................................................... 10,483,090 35.9%
Bernard J. Korman (3) .................................................. 1,597,000 5.9
Ira Brind (4) .......................................................... 746,000 2.7
Leonard Wasserman (5) .................................................. 535,740 2.0
Verna K. Gibson(6) ..................................................... 372,500 1.4
Larry Feld (7) ......................................................... 326,916 1.2
Frank E. Johnson (8) ................................................... 149,633 *
Gary Kellman (9) ....................................................... 145,000 *
Randall Lambert ........................................................ 10,000 *
All directors and executive officers as a group (total of 10) (10) ..... 14,445,705 47.7
- ------------------
</TABLE>
* Less than one percent.
(1) The securities "beneficially owned" by a person are determined in
accordance with the definition of "beneficial ownership" set forth in the
regulations of the Securities and Exchange Commission and, accordingly,
include securities owned by or for the spouse, children or certain other
relatives of such person as well as other securities as to which the person
has or shares voting or investment power or has the right to acquire within
60 days after the Record Date. The same shares may be beneficially owned by
more than one person. Beneficial ownership may be disclaimed as to certain
of the securities.
(2) Includes Warrants to purchase 2,074,789 shares and options to purchase
150,000 shares under the Management Stock Option Plan. Also includes 1,175
shares and Warrants to purchase 587 shares allocated to Mr. David Feld's
account in the 401(k) Profit Sharing Plan and 210,000 shares currently held
by Mr. Feld which are subject to an option purchase agreement held by Alex.
Brown Incorporated. A total of 5,439,578 shares have been pledged by Mr.
David Feld to secure certain personal loans. Excludes 124,100 shares and
Warrants to purchase 62,050 shares held in trusts for the benefit of Mr.
David Feld's children, as to which Mr. David Feld disclaims beneficial
ownership. Mr. David Feld's address is c/o Today's Man, Inc., 835 Lancer
Drive, Moorestown, New Jersey 08057.
(3) Includes Warrants to purchase 10,000 shares and options to purchase 60,000
shares under the Management Stock Option Plan. Mr. Korman's address is c/o
Philadelphia Health Care Trust, 22nd and Chestnut Streets, Philadelphia, PA
19103.
(4) Includes Warrants to purchase 205,000 shares and options to purchase 60,000
shares under the Management Stock Option Plan. Also includes 3,500 shares
and Warrants to purchase 1,000 shares held by Mr. Brind in trust for his
children and 7,000 shares and Warrants to purchase 2,000 shares owned by
his wife.
(5) Includes Warrants to purchase 39,950 shares and options to purchase 120,000
shares under the Management Stock Option Plan. Also includes 2,131 shares
and Warrants to purchase 609 shares allocated to his account in the 401(k)
Profit Sharing Plan and 124,100 shares and Warrants to purchase 62,050
shares held in trusts for the benefit of Mr. David Feld's children for
which trusts Mr. Wasserman is trustee. Excludes shares held in trusts for
the benefit of Mr. Wasserman's children and grandchildren. Mr. Wasserman
disclaims beneficial ownership as to all such trust shares.
(6) Includes 87,500 shares and Warrants to purchase 25,000 shares held in an
Individual Retirement Account for Ms. Gibson. Also includes options to
purchase 60,000 shares under the Management Stock Option Plan.
(7) Includes Warrants to purchase 60,213 shares and options to purchase 60,000
shares under the Management Stock Option Plan. Also includes 1,197 shares
and Warrants to purchase 598 shares allocated to his account in the
4
<PAGE>
401(k) Profit Sharing Plan and includes 100 shares and Warrants to purchase
50 shares held by Mr. Larry Feld in trust for his son.
(8) Includes Warrants to purchase 7,733 shares and options to purchase 120,000
shares under the Management Stock Option Plan. Also includes 2,199 shares
and Warrants to purchase 735 shares allocated to his account in the 401(k)
Profit Sharing Plan.
(9) Includes Warrants to purchase 5,000 shares and options to purchase 120,000
shares under the Management Stock Option Plan.
(10) Includes in aggregate, options to purchase 774,000 shares under the
Management Stock Option Plan and Warrants to purchase 2,402,935 shares,
held by all directors and executive officers as a group.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who beneficially own 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. Officers, directors and
greater than ten-percent shareholders are required by regulation of the
Securities and Exchange Commission to furnish the Company with copies of all
Section 16(a) forms they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, all Section 16(a) filing requirements applicable to the
Company's officers, directors and greater than ten-percent beneficial owners
were complied with during fiscal 1998, except Mr. David Feld did not timely file
one Statement of Changes in Beneficial Ownership.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT
The Company's executive officer compensation program is comprised of base
salary, annual cash incentive compensation, long term incentive compensation in
the form of stock options, and various benefits generally available to all
full-time employees of the Company, including participation in group medical and
life insurance plans and the 401(k) Plan. The Company seeks to be competitive
with compensation programs offered by companies of a similar size within the
retail industry based on formal and informal surveys conducted by the Company.
Decisions with respect to the compensation of Mr. David Feld, the President
and Chief Executive Officer, are made by the Compensation Committee. Decisions
with respect to the compensation of all other executives officers are made by
Mr. David Feld.
BASE SALARY. Prior to the beginning of each fiscal year, financial and
other goals are established for the Company. Each executive officer is
responsible for accomplishing the goals pertaining to his area of
responsibility. At the end of each fiscal year, a performance review takes place
with each executive officer to measure performance against those objectives.
Base salary decisions are made based on the results of the performance review as
well as other considerations such as the executive officer's level of
responsibility, years of service with the Company and professional background.
In fiscal 1998, certain executive officers salaries were increased in connection
with annual performance reviews.
ANNUAL INCENTIVE COMPENSATION. The Annual Incentive Bonus Plan (the
"Incentive Plan") is designed to promote the interest of the Company by
providing meaningful incentive compensation to management and key professionals
to drive performance. The plan is designed to provide incentive opportunities
dependent upon the achievement of predetermined performance goals which are
measured relative to earnings before interest, income taxes, depreciation and
amortization ("EBITDA"). No payouts were made under this plan for fiscal 1998.
SEVERANCE PLAN. The Company adopted a Severance Plan to encourage the
continued employment of its employees during the Company's bankruptcy
proceeding. The provisions of the Severance Plan continued upon the Company's
emergence from its bankruptcy proceedings. All employees are entitled to
participate in the Severance Plan. In the event an employee's employment is
terminated by the Company without "Cause," such employee will be entitled to a
continuation of his or her base salary for a period of time based on the
individual's position and, in some
5
<PAGE>
cases, length of service with the Company. "Cause" is defined as the willful and
continued failure of the employee to perform his or her duties or the willful
engaging by employee in illegal conduct or gross misconduct materially injurious
to the Company. In addition, the employee is entitled to continued medical
benefits during the severance period, subject to reduction or elimination in the
event that the employee obtains medical benefits as a result of new employment.
Under the Severance Plan, executive officers will be entitled to receive their
base salary for from six to 18 months after termination of their employment
without Cause, depending on their position, except that any compensation
received by an executive officer who is a Vice President or above as a result of
new employment obtained during the severance period will be set off against and
reduce up to a maximum of one-half of the amount of severance payable to the
former executive officer.
CHANGE IN CONTROL PLAN. The Company adopted a Change in Control Plan for
its executive officers and vice presidents which provides that, in the event
their employment is terminated by them voluntarily for "good cause" or
involuntarily without cause, they will be entitled to a lump sum cash payment
consisting of their base salary through the date of termination, a proportionate
bonus based upon the highest annual bonus, a pro rata retention bonus, if
applicable, one or two times, depending on their position, the executive's base
salary equal to or greater than the highest base salary paid to the executive by
the Company during the previous year and unpaid deferred compensation and
vacation pay. In addition, the executive is entitled to continued employee
welfare benefits for one or two years, depending upon their position. There is
no obligation under the part of the executive to mitigate damages. Good reason
means: the diminution of responsibilities, assignment to inappropriate duties,
adjustments to compensation or benefits provisions such that (a) the monthly
base salary is less than the highest monthly base salary paid to the executive
by the Company during the previous year, (b) annual incentive bonus
opportunities which are substantially similar to those which were available
prior to the change of control, (c) any earned retention bonus which is not paid
according to the award schedule or (d) savings, welfare benefits, fringe
benefits or retirement plan participation which is not substantially similar to
that which was in effect prior to the change of control, transfer more than 50
miles, a purported termination of the Agreement by the Company other than in
accordance with the Agreement, or failure of the Company to require any
successor to the Company to comply with the Agreement. Determination by the
executive of "good reason" shall be conclusive if made in good faith.
STOCK OPTIONS. The Company uses the Management Stock Option Plan (the
"Management Plan") as additional incentive plan for officers, key employees and
directors. The purpose of the Management Plan is to attract and retain officers,
key employees and directors and to provide additional incentive to them by
encouraging them to invest in the Common Stock and acquire an increased personal
interest in the Company's business. The Management Plan replaced the Company's
Employee Stock Option Plan, Director Stock Option Plan and 1995 Non-Employee
Director Stock Option Plan (the "Prior Plans"). All options outstanding under
the Prior Plans were automatically terminated upon confirmation of the Company's
Plan of Reorganization.
The Management Plan authorizes the Compensation Committee to award stock
options to officers, key employees and directors. Stock option grants are
determined by the Compensation Committee based upon recommendations of senior
management and are made at a level calculated to be competitive within the
retail industry. In general under the Management Plan, options are granted with
an exercise price equal to the fair market value of the Common Stock on the date
of the grant and are exercisable according to a vesting schedule determined by
the Compensation Committee at the time of grant. No options were granted by the
Committee under the Management Plan during fiscal 1998 to the directors or
executive officers of the Company named in the Summary Compensation Table.
DETERMINATION OF COMPENSATION OF CHIEF EXECUTIVE OFFICER. Mr. David Feld's
base salary for fiscal 1998 was not increased from his fiscal 1997 base salary
of $190,000.
POLICY WITH RESPECT TO SECTION 162(M) OF THE INTERNAL REVENUE CODE.
Generally, Section 162(m) of the Internal Revenue Code of 1986, and the
regulations promulgated thereunder (collectively, "Section 162(m)"), denies a
deduction to any publicly held corporation, such as the Company, for certain
compensation exceeding $1,000,000 paid during a taxable year to the chief
executive officer and the four other highest paid executive officers, excluding,
among other things, certain performance-based compensation. The Compensation
Committee continually evaluates to what extent Section 162(m) will apply to its
compensation programs.
Members of the Compensation Committee during fiscal 1998: Ira Brind,
Chairman, and Verna K. Gibson.
6
<PAGE>
SUMMARY COMPENSATION TABLE
The following table sets forth certain information regarding the
compensation paid to the Chief Executive Officer and each of the four other most
highly compensated executive officers of the Company for services rendered in
all capacities for fiscal 1998, fiscal 1997 and fiscal 1996.
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
------------------- ------------
OTHER SECURITIES
NAME AND FISCAL ANNUAL UNDERLYING ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION OPTIONS COMPENSATION (2)
- ------------------ ---- ------ -------- ------------ ------- ----------------
<S> <C> <C> <C> <C> <C> <C>
David Feld 1998 $190,000 $ -- $ -- -- $3,649
President and 1997 190,000 98,438 -- 250,000 3,800
Chief Executive Officer 1996 190,000 86,625 -- -- 3,800
Frank E. Johnson 1998 218,462 -- -- -- 3,662
Executive Vice 1997 194,615 97,401 -- 200,000 3,800
President and Chief 1996 165,000 84,437 -- -- 3,800
Financial Officer
Gary Kellman (4) 1998 300,000 -- -- -- 4,000
Executive Vice President, 1997 300,000 54,088 129,031(3) 200,000 --
General Merchandise 1996 63,462 70,006 -- -- --
Manager
Leonard Wasserman 1998 250,000 -- -- -- 3,514
Executive Vice President, 1997 250,000 119,713 -- 200,000 3,800
Operations 1996 250,000 91,875 -- -- 3,800
Larry Feld 1998 172,308 -- -- -- 712
Vice President 1997 165,000 62,642 -- 300,000 714
Store Development 1996 165,000 49,673 -- -- 2,637
</TABLE>
- ------------------
(1) Represents bonuses earned under the Retention Bonus Plan and Incentive
Plan. Bonuses earned under the Incentive Plan were paid in the following
fiscal year.
(2) Represents the Company's matching contribution under the 401(k) Profit
Sharing Plan.
(3) Represents relocation expenses paid on behalf of Mr. Kellman of $114,431.
The cost of perquisites is not disclosed for any other executive officers
because the disclosure threshold (the lower of $50,000 or 10% of salary
plus bonus) was not reached in the year presented.
(4) In April 1999, the Company terminated the employment of Mr. Kellman.
OPTION GRANTS IN LAST FISCAL YEAR
No stock options were granted under the Management Stock Option Plan during
fiscal 1998 to the executive officers of the Company named in the Summary
Compensation Table.
AGGREGATED OPTION EXERCISES IN LAST YEAR AND FISCAL YEAR-END OPTION VALUES
The following table sets forth certain information concerning the number
and value of unexercised options held at the end of fiscal 1998 by the executive
officers of the Company named in the Summary Compensation Table.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
ACQUIRED ON VALUE OPTIONS AT FISCAL YEAR-END FISCAL YEAR-END
NAME EXERCISE REALIZED(1) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(2)
---- -------- ----------- ------------------------- ----------------------------
<S> <C> <C> <C> <C>
David Feld ................ -- -- 150,000/100,000 $0/$0
Leonard Wasserman ......... -- -- 120,000/80,000 0/0
Frank E. Johnson .......... -- -- 120,000/80,000 0/0
Gary Kellman .............. -- -- 120,000/80,000 0/0
Larry Feld ................ -- -- 60,000/40,000 0/0
</TABLE>
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(1) No options were exercised by the named executive officers in fiscal 1998.
(2) The last sale price of the Common Stock on January 29, 1999, the last
trading day in fiscal 1998, as reported on the Nasdaq National Market
System, was $1.65625 per share. All of the options in the above table have
an exercise price of $2.38 per share.
7
<PAGE>
MANAGEMENT STOCK OPTION PLAN
The Company's Management Stock Option Plan ("Management Plan") was adopted
by the Board in July 1997 and approved by the Bankruptcy Court on December 12,
1997. The purpose of the Management Plan is to attract and retain officers, key
employees and directors and to provide additional incentive to them by
encouraging them to invest in the Common Stock and acquire an increased personal
interest in the Company's business. The Management Plan replaced the Company's
Employee Stock Option Plan, Director Stock Option Plan and 1995 Non-Employee
Director Stock Option Plan (the "Prior Plans"). All of the options which were
outstanding under the Prior Plans terminated automatically upon the confirmation
of the Company's Plan of Reorganization. Payment of the exercise price for
options granted under the Management Plan may be made in cash, shares of Common
Stock or a combination of both. Options granted pursuant to the Management Plan
may not be exercised more than ten years from the date of grant.
All officers, key employees and directors of the Company or any of its
current or future parents or subsidiaries are eligible to receive options under
the Management Plan. The Management. No individual may receive options under the
Management Plan for more than 25% of the total number of Shares of Common Stock
authorized for issuance under the Management Plan.
The Management Plan is administered by the Compensation Committee of the
Board of Directors. The Compensation Committee selects the optionees and
determines the nature of the option granted, the number of shares subject to
each option, the option vesting schedule and other terms and conditions of each
option. The Board of Directors may modify, amend, suspend or terminate the
Management Plan, provided that such action may not affect outstanding options.
Options to purchase an aggregate of 2,450,000 shares of Common Stock may be
granted pursuant to the Management Plan (subject to appropriate adjustments to
reflect changes in the capitalization of the Company). Options granted under the
Management Plan may be incentive stock options ("Incentive Options") intended to
qualify under Section 422 of the Internal Revenue Code of 1986, as amended, or
options not intended to so qualify ("Non-Qualified Options"). The option price
for Incentive Options issued under the Management Plan must be equal at least to
the fair market value of the Common Stock on the date of the grant of the
option, provided, however, that if an Incentive Option is granted to an
individual who, at the time the option is granted, is deemed to own more than 10
percent of the total combined voting power of all classes of stock of the
Company (a "10% Shareholder"), the option price will be at least 110 percent of
the fair market value on the date of grant. The option price for Non-Qualified
Options issued under the Management Plan may, in the sole discretion of the
Committee, be less than the fair market value of the Common Stock on the date of
the grant of the option. The fair market value of the Common Stock on any date
shall be determined by the Committee in accordance with the Management Plan and
generally shall be the last reported sale price of the share of the Common Stock
on the Nasdaq National Market on such date, or if no sale took place on such
day, the last such date on which a sale took place.
All unexercised options terminate three months following the date an
optionee ceases to be employed by the Company or any parent or subsidiary of the
Company, other than by reason of disability or death (but not later than the
expiration date), whether or not such termination is voluntary, except that if
an optionee is terminated for cause, all unexercised options will terminate
immediately. Any option held by an employee who dies or who ceases to be
employed because of disability must be exercised by the employee or his
representative within one year after the employee dies or ceases to be an
employee (but not later than the expiration date). Options are not transferable
except in the event of death to the decedent's estate. No options may be granted
under the Management Plan afterJuly 30, 2007.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Certain Transactions
Executive Equity Plan Loans. The Company made loans to the former
participants of the Company's Executive Equity Plan to permit them to pay their
federal and state income tax resulting from the termination of that plan in 1992
and the conversion of the participant's interests in the plan into shares of
Common Stock, including loans of $239,085 to Mr. Wasserman, $272,798 to Mr.
Larry Feld and $30,112 to Mr. Johnson. These loans bear interest at 1% above the
prime rate, were payable in a single payment of principal and interest on April
14, 1996 (plus a 30 day grace period), subject to prepayment if the shares are
sold or the participant's employment with the Company terminates, and are
secured by a pledge of a portion of the shares. The Company believes that the
interest rate of these
8
<PAGE>
loans was comparable to the interest rate that participants could obtain from
unaffiliated parties but that the repayment terms are more favorable. Certain of
these loans, including Messrs. Wasserman's, Larry Feld's and Johnson's loans,
are past due. The Company currently is evaluating appropriate arrangements with
the obligors of these loans.
Leases. The Company leases its executive offices, distribution center and
certain adjoining land, located in Moorestown, New Jersey, and three of its
superstores from Mr. David Feld. Set forth below is information with respect to
those leases. Except as noted below, the Company pays an annual base rental and
all operating expenses during the term of the lease, including property taxes
and insurance. None of the leases have unexercised renewal options.
LEASE LEASE
COMMENCEMENT TERMINATION ANNUAL BASE
LOCATION DATE DATE RENTAL(1)
-------- ---- ---- ---------
Center City Philadelphia, PA ........ 1980 2007 $364,992
Deptford, NJ ........................ 1985 2008 296,000(2)
Moorestown, NJ ...................... 1988 2010 739,200
Langhorne, PA ....................... 1988 2008 342,250(2)
- ---------------
(1) Does not include taxes, insurance and other operating expenses payable by
the Company.
(2) Increases annually based upon increases in the Consumer Price Index.
The Company leases from Mr. David Feld a parcel of land adjacent to the
Company's Montgomeryville store for use as a parking lot pursuant to a two year
lease which expired in March 1994. The Company paid an annual base rental of
$81,000 plus all operating expenses during the term of this lease. The Company
continues to lease this parcel on a month-to-month basis pending the execution
of a new lease.
In fiscal 1998, the Company paid an aggregate of $1,789,400 to Mr. David
Feld under all leases with him. The Company believes that the terms of each of
the leases with Mr. David Feld are no less favorable to the Company than those
generally available from unaffiliated third parties. The Company will not lease
additional facilities to or from any officers, directors or affiliated parties
without the approval of its non-employee directors.
Tax Indemnification Agreement. From January 1, 1987 to January 30, 1992,
the Company was subject to taxation under Subchapter S of the Internal Revenue
Code of 1986. As a result, the net income of the Company, for federal and
certain state income tax purposes, was reported by and taxed directly to Mr.
David Feld, the Company's sole shareholder at such time, rather than to the
Company. In connection with the Company's initial public offering, the Company
entered into a tax indemnification agreement, as amended, with Mr. David Feld
which provided for, among other things (i) an indemnification by the Company of
Mr. Feld for any losses or liabilities with respect to any additional taxes
(including interest, penalties, legal fees and any additional taxes resulting
from any indemnification) resulting from the Company's operations during the
period in which it was an S Corporation and (ii) an indemnification by Mr. Feld
of the Company for the amount of any tax refund received by Mr. Feld due to a
reduction in his share of the Company's S Corporation earnings for calendar year
1991 and the period from January 1 through January 30, 1992 less any income
payable by Mr. Feld with respect to distributions to him from January 1, 1991
through September 15, 1993.
9
<PAGE>
STOCK PERFORMANCE GRAPH
The following graph shows a comparison of the cumulative total return for
the Company's Common Stock, the S&P 500 Index and the S&P Retail Specialty
Index, assuming an investment of $100 in each on January 29, 1994, and, in the
case of the Indexes, the reinvestment of all dividends. The data points used for
the performance graph are listed below.
[GRAPLICAL REPRESENTATION OF STOCK PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
PERFORMANCE GRAPH DATA POINTS
1/29/94 1/28/95 2/3/95 2/3/96 1/30/98 1/29/99
------- ------- ------ ------ ------- -------
<S> <C> <C> <C> <C> <C> <C>
Today's Man, Inc. Common Stock 100 71 13 17 24 13
Nasdaq Stock Market Index 100 95 135 177 209 326
Nasdaq Retail Trade Stock Index 100 88 100 123 143 175
</TABLE>
10
<PAGE>
SHAREHOLDER PROPOSALS
Under the Company's Bylaws, shareholder proposals with respect to the 2000
Annual Meeting of Shareholders, including nominations for directors, which have
not been previously approved by the Board of Directors must be submitted to the
Secretary of the Company not later than January 22, 2000. Any such proposals
must be in writing and sent either by personal delivery, nationally-recognized
express mail or United States mail, postage prepaid to Today's Man, Inc., 835
Lancer Drive, Moorestown, NJ 08057, Attention: Secretary of the Company. Each
nomination or proposal must include the information required by the Bylaws. All
later or nonconforming nominations and proposals will be rejected.
Shareholder proposals for the 2000 Annual Meeting of Shareholders must be
submitted to the Company by January 22, 2000 to receive consideration for
inclusion in the Company's Proxy Statement relating to the 2000 Annual Meeting
of Shareholders. Any such proposal must also comply with SEC proxy rules,
including SEC Rule 14a-8.
In addition, shareholders are notified that the deadline for providing the
Company timely notice of any shareholder proposal to be submitted outside of the
Rule 14a-8 process for consideration at the Company's 2000 Annual Meeting of
Shareholders is January 22, 2000. As to all such matters which the Company does
not have notice on or prior to January 22, 2000, discretionary authority shall
be granted to the persons designated in the Company's proxy related to the 2000
Annual Meeting of Shareholders to vote on such proposal.
INDEPENDENT PUBLIC AUDITORS
The Company's independent public auditors for fiscal 1998 was the firm of
Ernst & Young LLP, Philadelphia, Pennsylvania. A representative of Ernst & Young
LLP is expected to be present at the Meeting and to be available to respond to
appropriate questions. The representative will have the opportunity to make a
statement if he so desires.
OTHER MATTERS
The Company is not presently aware of any matters (other than procedural
matters) which will be brought before the Meeting which are not reflected in the
attached Notice of the Meeting. The enclosed proxy confers discretionary
authority to vote with respect to any and all of the following matters that may
come before the Meeting: (i) matters which the Company did not have notice on or
prior to January 29, 1999 are to be presented at the Meeting; (ii) approval of
the minutes of a prior meeting of shareholders, if such approval does not amount
to ratification of the action taken at the meeting; (iii) the election of any
person to any office for which a bona fide nominee named in this Proxy Statement
is unable to serve or for good cause will not serve; (iv) any proposal omitted
from this Proxy Statement and the form of proxy pursuant to Rules 14a-8 or 14a-9
under the Securities Exchange Act of 1934; and (v) matters incident to the
conduct of the Meeting. In connection with such matters, the persons named in
the enclosed proxy will vote in accordance with their best judgment.
ANNUAL REPORT TO SHAREHOLDERS AND FORM 10-K
This Proxy Statement is accompanied by the Company's Annual Report to
Shareholders for fiscal 1998.
EACH PERSON SOLICITED HEREUNDER CAN OBTAIN A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-K FOR FISCAL 1998 AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, WITHOUT CHARGE EXCEPT FOR EXHIBITS TO THE REPORT, BY SENDING A
WRITTEN REQUEST TO:
TODAY'S MAN, INC.
835 LANCER DRIVE,
MOORESTOWN, NJ 08057
ATTENTION: FRANK E. JOHNSON, EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL
OFFICER
By Order of the Board of Directors
/s/ LARRY FELD
----------------------------------
LARRY FELD
Vice President and Secretary
Moorestown, New Jersey
May 21, 1999
11
<PAGE>
PROXY
TODAY'S MAN, INC.
ANNUAL MEETING OF SHAREHOLDERS--JUNE 23, 1999
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF TODAY'S MAN, INC.
The undersigned hereby constitutes and appoints Frank E. Johnson and Barry
S. Pine, and each of them, as attorney and proxies for the undersigned, with
full power of substitution, for and in the name, place and stead of the
undersigned, to appear at the Annual Meeting of Shareholders of Today's Man,
Inc. (the "Company") to be held on the 23rd day of June, 1999, and at any
postponement or adjournment thereof, and to vote all of the shares of the
Company which the undersigned is entitled to vote, with all the powers and
authority the undersigned would possess if personally present.
PROPOSAL 1. FOR |_| the election of Larry Feld and Verna Gibson as Class II
directors of the Company to hold office for a term of four years and until their
respective successors are duly elected and qualified.
To withhold authority to vote for Mr. Feld and Ms. Gibson as directors, please
check this box. |_|
To withhold authority to vote for an individual nominee, print that nominee's
name on the space provided below.
- --------------------------------------------------------------------------------
PROPOSAL 2. To transact such other business as may properly come before the
Annual Meeting
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS TO THE
CONTRARY ARE INDICATED, THE PROXY AGENTS INTENT TO VOTE FOR THE ELECTION OF THE
NOMINEES LISTED IN PROPOSAL 1.
BOTH PROXY AGENTS PRESENT AND ACTING IN PERSON OR BY THEIR SUBSTITUTES (OR,
IF ONLY ONE IS PRESENT AND ACTING, THEN THAT ONE) MAY EXERCISE ALL THE POWERS
CONFERRED BY THIS PROXY, DISCRETIONARY AUTHORITY IS CONFERRED BY THIS PROXY AS
TO CERTAIN MATTERS DESCRIBED IN THE COMPANY'S PROXY STATEMENT.
The undersigned hereby acknowledges receipt of the Company's 1998 Annual
Report to Shareholders, Notice of the Company's 1999 Annual Meeting of
Shareholders and Proxy Statement relating thereto.
Date: , 1999
-----------------------------------
(Please date this Proxy)
----------------------------------------
----------------------------------------
Signature(s)
(Please sign your name exactly as it
appears on this proxy indicating any
official position or representative
capacity. If shares are registered in
more than one name, all owners must
sign.)
PLEASE DATE AND SIGN THIS PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED POSTAGE
PAID ENVELOPE.
