<PAGE> 1
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>
Nautica Enterprises, 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):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (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:
------------------------------------------------------------------------
/X/ 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> 2
NAUTICA ENTERPRISES, INC.
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
------------------------
New York, New York
June 1, 1995
To the Stockholders of
NAUTICA ENTERPRISES, INC.
The Annual Meeting of Stockholders of Nautica Enterprises, Inc. will be
held on June 29, 1995 at the offices of the Company, 40 West 57th Street, New
York, New York, at 11:00 A.M. for the following purposes:
(1) To elect Directors to serve until the next annual meeting of
stockholders or until their successors are duly elected and qualified;
(2) To consider and vote on a proposal to amend the Certificate of
Incorporation of the Company to increase the number of authorized
shares of Common Stock from 20,000,000 to 50,000,000; and
(3) To transact such other business as may properly come before the meeting
and any adjournment or adjournments thereof.
Only stockholders of record at the close of business on May 25, 1995 are
entitled to notice of and to vote at the meeting and any adjournment or
adjournments thereof.
STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING IN PERSON, BUT WISH
THEIR STOCK TO BE VOTED ON MATTERS TO BE PRESENTED TO THE MEETING, ARE URGED TO
SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE TO WHICH
NO POSTAGE NEED BE AFFIXED IF MAILED WITHIN THE UNITED STATES.
By Order of the Board of Directors,
HARVEY SANDERS,
Chairman
<PAGE> 3
NAUTICA ENTERPRISES, INC.
40 WEST 57TH STREET
NEW YORK, NEW YORK 10019
------------------------
PROXY STATEMENT
------------------------
This proxy statement is furnished with respect to the solicitation of
proxies by the Board of Directors of Nautica Enterprises, Inc. (the "Company")
for the Annual Meeting of Stockholders of the Company to be held at 11:00 A.M.
on June 29, 1995 and at any adjournment or adjournments thereof, at 40 West 57th
Street, 7th floor, New York, New York 10019. The approximate date on which the
proxy statement and form of proxy was first sent or given to stockholders was
June 1, 1995.
Proxies in the accompanying form which are properly executed and duly
returned to the Board of Directors will be voted at the meeting. Any proxy may
be revoked by the stockholder at any time prior to its being voted. Such
revocation shall be effective upon receipt of a written notice by the Secretary
of the Company at the address specified above.
The expense of the solicitation of proxies for the meeting, including the
cost of mailing, will be borne by the Company. In addition to mailing copies of
the enclosed proxy materials to stockholders, the Company may request persons,
and reimburse them for their expenses with respect thereto, who hold stock in
their names or custody or in the names of nominees for others to forward copies
of such materials to those persons for whom they hold stock of the Company and
to request authority for the execution of the proxies. In addition to the
solicitation of proxies by mail, it is expected that some of the officers,
directors, and regular employees of the Company, without additional
compensation, may solicit proxies on behalf of the Board of Directors by
telephone, telefax, and personal interview.
As of the close of business on May 25, 1995, the date for determining the
stockholders of record entitled to notice of and to vote at the Annual Meeting
and any adjournment or adjournments thereof, there were issued and outstanding
13,128,913 shares of the Company's Common Stock, the holders thereof being
entitled to one vote per share. The presence at the Annual Meeting of a majority
of such shares, in person or by proxy, are required for a quorum. The share data
included in this Proxy Statement has not been adjusted to reflect a stock split
to be effected in the form of a stock dividend payable on July 6, 1995 upon
stockholder approval of the proposal included herein to increase the number of
authorized shares of Common Stock of the Company.
The form of proxy solicited by the Board of Directors affords stockholders
the ability to specify a choice among approval of, disapproval of, or abstention
with respect to, each matter to be acted upon at the Annual Meeting. Shares
represented by the proxy will be voted and, where the solicited stockholder
indicates a choice on the form of proxy with respect to any matter to be acted
upon, the shares will be voted as specified. Abstentions and broker non-votes
will not have the effect of votes in opposition to a person nominated as a
Director or against the other proposal to be considered at the Annual Meeting.
<PAGE> 4
ELECTION OF DIRECTORS
The persons named in the accompanying proxy intend to vote for the election
as Directors the six nominees listed herein. All of the nominees have consented
to serve if elected. All Directors will be elected to hold office until the next
annual meeting of stockholders, and, in each case, each Director will serve
until his successor is elected and qualified or until his earlier resignation or
removal. If a nominee should be unable to act as a Director, which is not
anticipated, the persons named in the proxy will vote for any nominee who shall
be designated by the present Board of Directors to fill the vacancy. Each of the
nominees presently serves as a Director.
Set forth below is biographical information for each of the nominees.
Unless otherwise indicated, each has served in his stated capacity for the last
five years:
Robert B. Bank, age 48, has been a Director of the Company since 1989. He
is President of Robert B. Bank Advisory Services, a venture capital firm, and a
Director of Jos. A. Bank Clothiers, Inc., a manufacturer and retailer of men's
tailored clothing.
David Chu, age 40, joined the Company in 1984 and became a Director in
1987. He has served as Executive Vice President of the Company since 1989 and
President of Nautica International, Inc. and Nautica Apparel, Inc., each wholly
owned subsidiaries of the Company, since 1984.
George Greenberg, age 73, has been a Director of the Company since 1988. He
is Vice Chairman and a Director of Guilford Mills, Inc., a textile manufacturer.
Mr. Greenberg is the father-in-law of Harvey Sanders, Chairman of the Board and
President of the Company.
Israel Rosenzweig, age 47, has been a Director of the Company since 1990.
He is President and a Trustee of BRT Realty Trust, a real estate investment
trust. He has been a Director of Bankers Federal Savings FSB, a savings and loan
association, since 1993 and its Executive Vice President and Chief Lending
Officer since 1994.
Harvey Sanders, age 45, has been President, Chief Executive Officer and a
Director of the Company since 1977 and Chairman of the Board since October 1993.
Charles H. Scherer, age 51, has been a Director of the Company since May
1994. He is managing partner of Hughes Hubbard & Reed, a New York City law firm
that provides legal services to the Company.
Shares represented by proxies solicited by the Board of Directors, will,
unless contrary instructions are given, be voted in favor of the election as
directors of the nominees named above. If a stockholder wishes to withhold
authority to vote for any nominee, such stockholder can do so by following the
directions set forth on the form of proxy solicited by the Board of Directors or
on the ballot distributed at the Annual Meeting if such stockholder wishes to
vote in person. Directors shall be elected by a plurality vote of the shares of
Common Stock present in person or represented by proxy at the meeting.
During fiscal year 1995, the Board of Directors held four meetings. The
Compensation Committee of the Board of Directors is comprised of Messrs. Bank
and Rosenzweig. The Compensation Committee sets the compensation to be paid to
the Company's principal executive officers. The Audit Committee of the Board of
Directors is comprised of Messrs. Bank, Scherer and Rosenzweig. The Audit
Committee reviews the audit plan with the Company's independent accountants, the
scope and results of their audit and other related audit and accounting issues.
During fiscal year 1995, the Compensation Committee held two meetings and the
Audit Committee held one meeting. The Board of Directors as a whole proposes
nominees for election to the Board of Directors.
2
<PAGE> 5
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding ownership of
the Company's Common Stock as of May 16, 1995 by all stockholders known to the
Company to have been beneficial owners of more than five percent of its Common
Stock, by each nominee for Director, by each of the executive officers of the
Company included in the Summary Compensation Table below, and all directors and
executive officers as a group.
<TABLE>
<CAPTION>
NAME OF AMOUNT BENEFICIALLY PERCENT OF
BENEFICIAL OWNER(1) OWNED(2)(3) CLASS(%)
-------------------------------------------------- ------------------- ----------
<S> <C> <C>
Robert B. Bank.................................... 16,900 *
Sharon Burd....................................... 14,700 *
David Chu......................................... 632,861 4.7
George Greenberg.................................. 12,455 *
Israel Rosenzweig................................. 9,400 *
Harvey Sanders.................................... 1,604,947 12.2
Charles H. Scherer................................ 1,200 *
John Wetzler...................................... 25,631 *
Charles Zona...................................... 89,781 *
All Directors and Executive 2,407,875 18.0
Officers as a group.............................
</TABLE>
- ---------------
* Indicates holdings of less than 1%.
(1) The ages of the executive officers of the Company included above are as
follows: Sharon Burd - 42; David Chu - 40; Harvey Sanders - 45; John
Wetzler - 49; and Charles Zona - 45.
(2) Directly and indirectly. The inclusion of securities owned by others as
beneficially owned by the respective nominees and officers does not
constitute an admission that such securities are beneficially owned by them.
All of the named individuals have, except as set forth in Note 3 below, sole
voting and investment powers with respect to the aforesaid shares.
(3) Includes the following shares which may be acquired pursuant to existing
stock options which are exercisable through July 16, 1995: Robert B.
Bank - 7,150; Sharon Burd - 14,700; David Chu - 293,121; George
Greenberg - 7,150; Israel Rosenzweig - 7,150; Harvey Sanders - 92,800;
Charles H. Scherer - 200; John Wetzler - 24,469; and Charles Zona - 58,500.
With respect to Mr. Sanders, includes 450,000 shares owned by the Harvey
Sanders Grantor Retained Income Trust. Such trust has sole voting and
investment power with respect to such shares.
For the fiscal year ended February 28, 1995, Charles H. Scherer, a Director
of the Company, filed one late report under Section 16(a) of the Securities and
Exchange Act of 1934, reflecting one transaction.
3
<PAGE> 6
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table shows, for the fiscal years ending February 28, 1993,
1994 and 1995, the cash compensation paid by the Company and its subsidiaries,
to the Company's Chief Executive Officer and each of the four most highly
compensated executive officers of the Company as of February 28, 1995.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
------------------- ------------ ALL OTHER
SALARY BONUS OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) (#) ($)(1)
- ----------------------------------------------- ---- ------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Harvey Sanders................................. 1995 699,000 589,680 59,000 2,424
Chairman of the Board, Chief Executive 1994 575,000 397,000 67,500 2,248
Officer and President 1993 260,875 360,000 112,500 2,182
Sharon Burd.................................... 1995 153,000 80,000 6,000 2,250
Controller 1994 130,000 62,000 -- 2,158
1993 76,815 60,000 7,500 1,142
David Chu...................................... 1995 627,000 491,400 59,000 2,250
Executive Vice President and 1994 522,000 335,000 45,000 2,248
President -- Nautica International, Inc. 1993 256,150 300,000 75,000 2,182
and Nautica Apparel, Inc., wholly
owned subsidiaries of the Company
John Wetzler................................... 1995 219,000 100,000 3,000 2,250
President -- Nautica Retail USA, Inc., 1994 199,300 40,000 7,500 2,248
a wholly subsidiary of the Company 1993 184,600 20,000 -- 2,182
Charles Zona................................... 1995 308,000 -- -- 2,250
President -- State-O-Maine, Inc., a 1994 279,000 37,000 -- 2,248
wholly owned subsidiary of the Company 1993 202,960 85,000 22,500 1,182
</TABLE>
- ---------------
(1) "All Other Compensation" is comprised of contributions made by the Company
to the named executives pursuant to the Company's 401(k) Plan and, with
respect to Mr. Sanders, an additional amount of $174 for split-dollar life
insurance calculated pursuant to P.S. - 38.
STOCK OPTIONS
The following table contains information concerning the grant of stock
options during fiscal year 1995 under the Company's Executive Incentive Stock
Option Plan and 1989 Employee Incentive Stock Plan to each of the Company's
executives listed in the Summary Compensation Table above receiving stock
options during such period.
The table also illustrates the Grant Date Present Value of those stock
options based upon the Black-Scholes Model of Valuation, without giving effect
to the non-transferability or vesting requirements of the options.
4
<PAGE> 7
No matter what theoretical value is placed on a stock option on the date of
grant, its ultimate value will be dependent on the market value of the Company's
Common Stock at a future date. If the price of the Company's Common Stock
increases, all stockholders will benefit commensurably with the optionees.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS GRANTED EXERCISE OR GRANT DATE
OPTIONS GRANTED TO EMPLOYEES BASE PRICE EXPIRATION PRESENT
NAME (#)(1) IN FISCAL YEAR ($/SH) DATE VALUE($)(2)
- -------------------------- --------------- --------------- ------------ ---------- -----------
<S> <C> <C> <C> <C> <C>
Harvey Sanders............ 59,000 33.9 22.375 05/12/04 867,890
Sharon Burd............... 6,000 3.4 22.375 05/12/04 88,260
David Chu................. 59,000 33.9 22.375 05/12/04 867,890
John Wetzler.............. 3,000 1.7 22.375 05/12/04 44,130
</TABLE>
- ---------------
(1) All options were granted at market value at the date of grant for a term of
ten years, subject to earlier termination in certain instances related to
termination of employment. All option grants are exercisable cumulatively in
five equal annual installments commencing one year following the date of
grant. The date of grant for the options granted to each of the executives
named above was May 12, 1994. The required tax withholding obligations
related to exercise of certain options may be paid by delivery of already
owned shares or by offset of the underlying shares, subject to certain
conditions.
(2) The amounts shown assume a value based on the Black-Scholes Model of
Valuation. The assumptions used were as follows: volatility -- 40%;
risk-free rate of return -- 7.35%; and, time of exercise -- 10 years. No
adjustments were made for non-transferability or risk-of-forfeiture. There
can be no assurance that the rate of appreciation assumed for purposes of
this table will be achieved. The stock options will have no value to the
executives named above or other optionees if the price of the Company's
Common Stock does not increase above the exercise price of the option.
5
<PAGE> 8
OPTION EXERCISES AND HOLDINGS
The following table sets forth information with respect to the Company's
executives listed in the Summary Compensation Table above, concerning the
exercise of options during the last fiscal year and unexercised options held as
of the end of the 1995 fiscal year.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT FY-END(#) OPTIONS AT FY-END($)
ACQUIRED ON VALUE ------------------------- -------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- ----------------------- ------------ ------------ ------------------------- -------------------------
<S> <C> <C> <C> <C>
Harvey Sanders......... -- -- 58,500/180,500 1,198,508/2,914,593
Sharon Burd............ 6,750 168,938 9,750/ 15,000 274,391/ 274,350
David Chu.............. -- -- 266,321/140,000 7,281,063/2,115,145
John Wetzler........... -- -- 21,019/ 11,700 584,401/ 222,023
Charles Zona........... 25,000 714,450 54,031/ 36,000 1,416,773/ 887,670
</TABLE>
DIRECTOR COMPENSATION
Each nonemployee Director receives compensation of $3,500 for each Board
meeting attended, and $2,000 for each Committee meeting attended. No fees are
payable to officers and employees of the Company who serve as Directors. During
fiscal year 1995, Messr. Bank, Greenberg and Rosenzweig each were granted 2,000
options and Mr. Scherer was granted 1,000 options at an exercise price of $21.50
per share.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company and Messrs. Sanders and Chu have entered into an agreement
which provides that upon the death of either of them, the Company will purchase
a part of the common shares of such stockholder. The Company has obtained
policies of life insurance on the lives of such stockholders for the purpose of
utilizing the proceeds from such insurance for the purchase of the shares. The
agreement provides for the Company to purchase the shares of the deceased
stockholder at a value which is equal to the average of the last sale price as
reported on the National Market List of the NASDAQ (or the closing price if the
shares are listed on a national securities exchange) for the thirty trading days
prior to the date of death of the deceased stockholder. The Company's obligation
to purchase the common shares of the deceased stockholder is limited to the life
insurance proceeds received by the Company on the death of such stockholder. The
agreement also provides, as soon after the death of the stockholder as is
practicable, for the filing of a registration statement with the Securities and
Exchange Commission for a secondary offering to provide for the sale of the
balance of the shares owned by the deceased stockholder not purchased by the
Company with the life insurance proceeds.
Messrs. Sanders and Chu have agreed to vote through July 1, 1996 all of
their respective shares owned of record or beneficially to ensure that each of
Mr. Sanders and Mr. Chu, or their respective nominees, will be elected to the
Board of Directors of the Company.
Mr. David Chu, Executive Vice President of the Company and President of
Nautica Apparel, Inc. and Nautica International, Inc., both wholly owned
subsidiaries of the Company, is entitled to receive 50% of the
6
<PAGE> 9
net income Nautica Apparel, Inc. receives from all royalty income earned with
respect to the Nautica name and trademarks. For the year ended February 28,
1995, Mr. Chu earned net royalty income of $1,285,000.
During fiscal year 1995, the Company paid $59,550, $54,650 and $291,750 to
the law firm of Jaffe Segal and Ross, to Samuel Sultanik, Esq. and to the law
firm of Hughes Hubbard & Reed, respectively, for professional services rendered
to the Company. Until February 28, 1994, Samuel Sultanik, Esq., the brother-
in-law of Harvey Sanders, Chairman of the Board and a Director of the Company,
was counsel to Jaffe Segal and Ross, and since May 2, 1994 he has been counsel
to Hughs Hubbard & Reed. Charles H. Scherer, Esq., a Director of the Company, is
managing partner of Hughs Hubbard & Reed.
During fiscal year 1995, the Company paid $110,136 to the firm of
Chu/Pettersen Interior Design, Inc. for interior design and related services
provided to the Company. During such period, Mr. Peter Chu, the brother of David
Chu, Executive Vice President of the Company, was a stockholder and Vice
President in such firm.
EMPLOYEE CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
The Company has entered into agreements with Messrs. Sanders, Chu and Zona
providing that in the event of a change in control of the Company, as defined in
the agreement, each has the right to receive a lump sum payment upon termination
of employment other than for cause or permanent disability or resignation for
good reason within three years after the change in control. At February 28,
1995, the maximum amount payable to Mr. Sanders, Mr. Chu and Mr. Zona was
$4,012,000, $3,673,000 and $1,092,000, respectively.
The Company has entered into split-dollar agreements with trusts
established by each of Mr. Sanders and Mr. Chu. Pursuant to each of the
agreements, the Company pays the annual premium on specified life insurance
policies owned by each of the trusts, net of the amount of the "economic
benefit" attributable to each of the employees. The amount of the premiums paid
by the Company constitutes indebtedness from each of the trusts to the Company
and is secured by collateral assignments of each of the insurance policies to
the Company. The annual premium payable by the Company for the benefit of Mr.
Sanders' trust is $58,280 and for Mr. Chu's trust, $47,000. Upon termination of
each of the agreements, the Company is entitled to receive from each of the
trusts the amount equal to the aggregate premiums which it has paid. The face
value of the policy for Mr. Sanders' trust is $5,000,000 and for Mr. Chu's
trust, $4,850,000.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Robert B. Bank and Israel Rosenzweig served as members of the compensation
committee (the "Compensation Committee") of the Board of Directors during fiscal
year 1995.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Board of Directors is comprised of Robert
B. Bank and Israel Rosenzweig. The Compensation Committee is charged with
setting the compensation of the Company's senior executives. The Company's
executive compensation program consists of three main components: base salary,
potential for annual bonus or incentive awards based on performance, and the
opportunity to earn stock-based incentives designed to encourage the achievement
of superior results over time and ownership of Common Stock of the Company. The
Stock Option Committee (the "Stock Option Committee") of the Board of Directors
is charged with the responsibility of granting stock options to executive
employees. Messrs. Bank and Rosenzweig also comprise the Stock Option Committee.
In setting compensation, the Compensation Committee and the Stock Option
Committee review, with the assistance of independent compensation consultants,
available information for similar positions or levels at comparable companies.
Such companies
7
<PAGE> 10
include a diverse range of apparel manufacturers with sales within, below and
above the range of sales of the Company. The Compensation Committee has adopted
a policy to seek to maintain executive compensation within the deduction cap of
Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code").
In the Compensation Committee's determination of salary and bonus for
senior executives, it reviews certain factors, including earnings before income
taxes, earnings per share, sales, net income and gross profit margin. The
Compensation Committee places its greatest emphasis on earnings before income
taxes and weighs equally the remaining factors. It also reviews performance at
the subsidiary or divisional level, taking into account earnings, sales growth
and other criteria specifically relating to such subsidiary or division, and
reviews individual performance and contributions to the Company.
With respect to certain senior executives, including Harvey Sanders, the
Chairman of the Board, President and Chief Executive Officer of the Company, and
David Chu, the Executive Vice President of the Company, annual incentive award
opportunities are set in accordance with the Company's Incentive Compensation
Plan (the "Plan"). At the start of each fiscal year, the Compensation
Committee -- in consultation with management -- establishes target levels of
either earnings before income taxes, net earnings and/or return on equity for
the Company or a business unit. In fiscal year 1995, threshold levels of
earnings before income taxes were established. If the designated minimum level
of earnings before income taxes was not achieved, the participants would have
received no incentive award for fiscal year 1995 performance under the Plan
(although in its discretion, the Compensation Committee could have authorized an
award outside of the Plan). During such year, the threshold level was exceeded
and the participants received an incremental proportionately greater payment
than the minimum. The Compensation Committee has established target levels for
fiscal year 1996 based on earnings before income taxes and designated Messrs.
Sanders and Chu as participants under the Plan.
The Company's senior executives are eligible to receive stock options
and/or restricted stock in accordance with the Company's stock plans. The
objectives of such participation are to align executive and stockholder long
term interests and to enable executives to develop stock ownership position in
the Company. The Company's Stock Option Committee has the responsibility of
granting stock options and restricted stock awards to executive and management
employees. In granting stock options, the Stock Option Committee takes into
account Company performance, subsidiary performance and individual performance,
utilizing the same factors as those used in the determination of compensation.
The Stock Option Committee also takes into account the number of options held by
an individual and the total number of stock options outstanding. All of the
stock options granted to senior executives in fiscal year 1995 were exempt from
the deduction cap of Section 162(m) of the Code in accordance with the
regulations promulgated thereunder.
The Chairman of the Board, President and Chief Executive Officer of the
Company is Harvey Sanders. The criteria by which the Compensation Committee and
the Stock Option Committee determines salary and annual incentive awards and the
grant of stock options for senior executives, as set forth above, is also
utilized by the Compensation Committee and Stock Option Committee in determining
compensation and stock option awards, respectively, for Mr. Sanders.
Compensation Committee
and Stock Option Committee
Robert B. Bank
Israel Rosenzweig
8
<PAGE> 11
PERFORMANCE GRAPH
The following performance graph assumes $100 invested in Nautica
Enterprises, Inc. Common Stock, the NASDQ Stock Market (U.S.) and S&P Textiles
Index on March 1, 1990. Where applicable, it assumes reinvestment of dividends.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
NAUTICA ENTERPRISES, INC., NASDAQ STOCK MARKET (U.S.) AND
S&P TEXTILES INDEX
FOR THE FIVE YEARS ENDED FEBRUARY 28, 1995
[GRAPH]
<TABLE>
<CAPTION>
NAUTICA EN-
MEASUREMENT PERIOD TERPRISES, NASDAQ STOCK S&P TEXTILES
(FISCAL YEAR COVERED) INC. MARKET (U.S.) INDEX
<S> <C> <C> <C>
1990 100.00 100.00 100.00
1991 78.21 139.34 110.15
1992 264.11 199.14 157.20
1993 242.33 211.88 167.25
1994 576.97 250.83 198.00
1995 718.32 254.87 201.27
</TABLE>
APPROVAL OF AN AMENDMENT TO ARTICLE FIFTH OF THE COMPANY'S
CERTIFICATE OF INCORPORATION TO INCREASE THE NUMBER
OF AUTHORIZED SHARES OF COMMON STOCK
On April 18, 1995, the Board of Directors voted to propose and declare
advisable an amendment to Article Fifth of the Certificate of Incorporation
which would increase the total authorized shares of Common Stock of the Company
from 20,000,000 to 50,000,000. No change would be made in the par value, voting
rights, preferences, qualifications, limitations or restrictions applicable to
the Common Stock of the Company, nor in any other provision of the Certificate
of Incorporation of the Company. Under the Certificate of Incorporation,
stockholders do not have pre-emptive rights. The additional shares of Common
Stock would be available for issuance without further action or authorization by
the stockholders, unless such action is required by applicable law or the rules
of any stock exchange on which the Company's securities may then be listed.
As of May 25, 1995, there were issued and outstanding 13,128,913 shares of
Common Stock. An additional 1,422,730 unissued shares are reserved for issuance
upon exercise of option grants under the
9
<PAGE> 12
Company's Executive Incentive Stock Option Plan and the 1989 Employee Incentive
Stock Plan, and certain grants of nonqualified stock options.
On April 18, 1995 the Board of Directors approved a three-for-two stock
split to stockholders of record on May 5, 1995, to be effected in the form of a
stock dividend on July 6, 1995. Insofar as currently there are not a sufficient
number of shares of Common Stock authorized for issuance under the Company's
Certificate of Incorporation to meet the share requirements of the stock split,
it is subject to stockholder approval of this proposal. The Board of Directors
deems it desirable to have the additional shares of Common Stock available for
such stock split and for other general corporate purposes, including possible
future acquisitions, financings and stock dividends. Assuming approval of this
proposal, the number of shares of Common Stock which will be authorized but not
issued or reserved for issuance after giving effect to the three-for-two stock
split will be 28,172,536 shares.
An increase in the number of authorized shares of Common Stock could enable
the Company's Board of Directors to take certain actions making it more
difficult to acquire control of the Company, even though stockholders of the
Company may deem such an acquisition to be desirable. Issuance of shares of
Common Stock could dilute the ownership interest and voting power of
stockholders of the Company who are seeking control of the Company. Shares of
Common Stock could be issued in a private placement to one or more persons or
organizations sympathetic to management and opposed to any unsolicited takeover
bid, or under other circumstances that could make more difficult, and thereby
discourage, unsolicited attempts to acquire control of the Company. Such
consequences could serve to perpetuate the Company's existing management. The
Board is not presently aware of any such unsolicited interest in acquiring the
Company.
A copy of the proposed amendment to Article Fifth of the Company's
Certificate of Incorporation will be available at the Annual Meeting or may be
obtained prior to the meeting upon request to the Secretary of the Company at
the address set forth above. If the proposed amendment is approved by the
stockholders, a Certificate of Amendment of the Company's Certificate of
Incorporation will be filed as promptly as possible with the Secretary of State
of the State of Delaware and the three-for-two stock split effected in the form
of a stock dividend will be payable on July 6, 1995.
The Board of Directors recommends that all stockholders vote FOR the
proposed increase in the number of authorized shares of Common Stock to 50
million shares.
An affirmative vote of the holders of at least a majority of all
outstanding shares of Common Stock of the Company is required to approve the
amendment.
APPOINTMENT OF ACCOUNTANTS
The Board of Directors has selected Grant Thornton LLP as the independent
public accountants who will make an examination of the accounts of the Company
for the year ending February 28, 1996. A representative from Grant Thornton LLP
is expected to be present at the annual meeting to respond to appropriate
questions and to make a statement if that representative so desires.
PROPOSALS BY STOCKHOLDERS -- 1996 ANNUAL MEETING
All proposals by stockholders intended to be presented at the next annual
meeting of stockholders (to be held in July 1996) must be received by the
Company at its office at 40 West 57th Street, New York, New York 10019, no later
than February 28, 1996 in order to be included in the proxy statement and form
of proxy relating to such meeting. All such proposals must comply with
applicable Securities and Exchange Commission rules and regulations.
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OTHER BUSINESS
Management is not aware of any matters to be presented at the meeting other
than those set forth in this Proxy Statement. However, should any other business
properly come before the meeting, or any adjournment or adjournments thereof,
the enclosed Proxy confers upon the persons entitled to vote the shares
represented by such Proxies, discretionary authority to vote the same in respect
to any such other business in accordance with their best judgment in the
interest of the Company.
MANAGEMENT UNDERTAKES TO PROVIDE ITS STOCKHOLDERS WITHOUT CHARGE, UPON
WRITTEN OR ORAL REQUEST BY ANY SUCH STOCKHOLDER BY FIRST CLASS MAIL WITHIN ONE
BUSINESS DAY OF RECEIPT OF SUCH REQUEST, A COPY OF THE COMPANY'S ANNUAL REPORT
ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES FILED THEREWITH.
WRITTEN REQUEST FOR SUCH REPORT SHOULD BE ADDRESSED TO SHARON BURD, CONTROLLER,
NAUTICA ENTERPRISES, INC., 40 WEST 57TH STREET, NEW YORK, NEW YORK 10019. ORAL
REQUESTS SHALL BE MADE BY TELEPHONE TO SUCH PERSON AT (212) 541-5990.
Stockholders are urged to sign the enclosed proxy, solicited on behalf of
the Board of Directors, and return it at once in the envelope enclosed for that
purpose. Unless a contrary direction is indicated, Proxies will be voted for the
election as directors of the nominees listed in this Proxy Statement and for the
other proposal contained in this Proxy Statement. The Proxy does not affect the
right to vote in person at the meeting and may be revoked by the stockholder who
executed it any time prior to its being voted.
By Order of the Board of Directors
Harvey Sanders,
Chairman
June 1, 1995
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THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF
NAUTICA ENTERPRISES, INC.
PROXY--ANNUAL MEETING OF STOCKHOLDERS, JUNE 29, 1995
The undersigned hereby appoints Harvey Sanders and David Chu, and each of them,
proxies and attorneys-in-fact of the undersigned, with the power to appoint his
substitute, and hereby authorizes them to represent and to vote, as designated
below, all the shares of Common Stock of Nautica Enterprises, Inc. held of
record by the undersigned on May 25, 1995 at the Annual Meeting of Stockholders
to be held on June 29, 1995 or any adjournment thereof.
(CONTINUED AND TO BE DATED AND SIGNED ON THE REVERSE SIDE)
- --------------------------------------------------------------------------------
NAUTICA ENTERPRISES INC.
PLEASE MARK VOTE IN THE FOLLOWING MANNER USING DARK INK ONLY. /X/
<TABLE>
<S> <C>
1. Election of Directors:
Robert B. Bank, David Chu, George Greenberg,
Israel Rosenzweig, Harvey Sanders and Charles H. FOR ALL except
Scherer. FOR WITHHELD as listed at left
INSTRUCTION: To withhold authority to vote for / / / / / /
any individual nominee write that nominee's
name in the blank space below.
FOR AGAINST ABSTAIN
2. Approval of a proposal to amend the / / / / / /
Certificate of Incorporation of the Company to
increase the total authorized shares of Common
Stock to 50,000,000.
In their discretion, the Proxies are authorized to vote upon such
other business as may properly come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS "1" AND "2" ABOVE.
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Signature of Stockholder(s)
Please sign exactly as your name or names appear to the left
hereof. When shares are held by joint tenants, both should sign.
When signing as attorney, as executor, administrator, trustee or
guardian, please give full title as such. If a corporation, please
sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by
authorized person.
Dated:
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</TABLE>
