SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] 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
Swank, Inc.
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(Name of Registrant as Specified in Its Charter)
-----------------------------------------------
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11
1) Title of each class of securities to which transaction applies:
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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 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
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<PAGE>
4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] 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:
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4) Date Filed:
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-2-
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SWANK, INC. 6 Hazel Street, Attleboro, Massachusetts 02703
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The 1997 Annual Meeting of Stockholders of SWANK, INC. (the "Company")
will be held at the Company's offices at 6 Hazel Street, Attleboro,
Massachusetts, on April 24, 1997 at 11:00 o'clock A.M. local time, for the
purpose of considering and acting upon the following:
1. The election of two (2) Class II directors to serve on the
Company's Board of Directors;
2. The approval of the appointment of Coopers & Lybrand L. L. P. as
the independent accountants of the Company for the year 1997; and
3. The transaction of such other business as may properly come
before the meeting.
Only holders of record of Common Stock at the close of business on
February 27, 1997 will be entitled to notice of, and to vote at, the meeting or
any adjournment thereof.
By Order of the Board of Directors
Christopher F. Wolf,
Secretary
Dated: March 24,1997
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. IF YOU DO NOT
EXPECT TO BE PRESENT, PLEASE DATE AND SIGN THE ENCLOSED FORM OF PROXY AND RETURN
IT PROMPTLY TO THE COMPANY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED.
<PAGE>
SWANK, INC. 6 Hazel Street, Attleboro, Massachusetts 02703
PROXY STATEMENT
1997 ANNUAL MEETING OF STOCKHOLDERS
APRIL 24, 1997
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of SWANK, INC. (the "Company") of proxies in the form
enclosed for use at the Company's 1997 Annual Meeting of Stockholders (the
"Meeting") which will be held on the date, at the time and place and for the
purposes set forth in the foregoing notice, and at any adjournment or
postponement thereof. Any stockholder giving a proxy has the power to revoke the
same at any time before it is voted. All expenses in connection with the
solicitation of proxies will be borne by the Company. Proxies may be solicited
by certain officers and employees of the Company by mail, telephone, telecopier,
telegraph or personal interview.
The outstanding voting securities of the Company at the close of
business on February 27,1997, the record date for the determination of
stockholders entitled to notice of and to vote at the Meeting, consisted of
16,509,523 shares of Common Stock, $.10 par value per share ("Common Stock"),
each of which is entitled to one vote. A majority of the outstanding shares
entitled to vote, present in person or by proxy, constitutes a quorum for the
purposes of the Meeting. This Proxy Statement and the accompanying form of proxy
will be mailed or otherwise furnished on or about March 24, 1997 to all
stockholders of record at the close of business on February 27,1997.
OWNERSHIP OF VOTING SECURITIES
The following table sets forth information as of February 27, 1997 with
respect to each person (including any "group" of persons as that term is used in
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) who is
known to the Company to be the beneficial owner of more than 5% of the Common
Stock:
- - --------------------------------------------------------------------------------
Name and Amount and
Address of Nature of Percent
Title of Beneficial Beneficial of
Class Owner Ownership Class
- - --------------------------------------------------------------------------------
Common Stock The New Swank, Inc. 10,204,456(1)(2) 61.8%
Retirement Plan
90 Park Avenue
New York, NY 10016
Common Stock Marshall Tulin 4,416,376(3)(4) 26.4%
90 Park Avenue
New York, NY 10016
Common Stock John Tulin 3,958,839(3)(5) 23.7%
90 Park Avenue
New York, NY 10016
Common Stock Raymond Vise 3,566,254(3)(6) 21.6%
6 El Paseo
Irvine, CA 92715
- - --------------------------------------------------------------------------------
(1) The Company has merged its Employee Stock Ownership Plan No. 1 ("ESOP I"),
Employee Stock Ownership Plan No. 2 ("ESOP II") and Savings Plan into one plan,
The New Swank, Inc. Retirement Plan (the "Retirement Plan"). This amount
includes (a) 6,659,608 shares of Common Stock allocated to participants' ESOP I
accounts in the Retirement Plan and as to which such participants may direct the
trustees of the Retirement Plan as to voting on all matters, (b) an additional
183,723 shares of Common Stock allocated to participants' ESOP I accounts in the
Retirement Plan as to which such participants may direct the trustees, as
described below, as to voting on certain significant corporate events such as
mergers, consolidations, recapitalizations, reclassifications, liquidations,
dissolutions or sales of substantially all of a trade or business of the Company
(collectively, "Significant Corporate Events"), and (c) an additional 87,353 of
such shares allocated to the accounts of former employees, subject to
forfeiture, and able to be voted by the trustees on all matters on which
stockholders may vote.
1
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(2) This amount also includes 2,624,840 shares of Common Stock allocated to
participants' ESOP II accounts in the Retirement Plan as to which participants
may direct the trustees as to voting only on Significant Corporate Events and as
to which the trustees may vote on all other matters in their discretion. Shares
allocated to ESOP II accounts as to which no voting instructions are received
are required to be voted in the same proportion as shares allocated to ESOP II
accounts as to which voting instructions are received. This amount also includes
648,932 shares held in the 401(k) accounts under the Retirement Plan, as to
which participants may direct the trustees as to voting on all matters and may
be disposed of in the discretion of the trustees.
(3) The trustees of the Retirement Plan are Marshall Tulin, Chairman of the
Board and a director of the Company, John A. Tulin, President and a director of
the Company and Raymond Vise, a director of the Company. This amount includes
(a) allocated shares held in ESOP I accounts as to which the trustees have sole
voting power (see footnote 1 above), (b) 87,353 shares of Common Stock allocated
to the accounts of former employees but voted by the trustees (see footnote 1
above), (c) 2,624,840 shares held in ESOP II accounts as to which the trustees
have sole voting power (see footnote 2 above) and (d) 648,932 shares held in the
401(k) accounts (see footnote 2 above).
(4) This amount includes 343,022 shares owned by Mr. Tulin's wife. Mr. Tulin
disclaims beneficial ownership of these shares. This amount also includes
211,209 shares which Mr. Tulin has the right to acquire within 60 days through
the exercise of stock options granted under the Company's 1981 Stock Option Plan
(the "1981 Plan") and its 1987 Incentive Stock Option Plan (the "1987 Plan")
(collectively, the "Plans").
(5) This amount includes 3,180 shares owned by Mr. Tulin's wife and 7,000 shares
held by her as custodian for a child. Mr. Tulin disclaims beneficial ownership
of these shares. This amount also includes 192,209 shares which Mr. Tulin has
the right to acquire within 60 days through the exercise of stock options
granted under the Plans.
(6) This amount includes 15,000 shares which Mr. Vise has the right to acquire
within 60 days through the exercise of stock options granted under the 1994
Non-Employee Director Stock Option Plan (the "1994 Plan").
The following table sets forth information at February 27,1997 with
respect to the beneficial ownership of the Company's Common Stock by (a) each
director and each nominee for election as a director of the Company, (b) each
executive officer named in the Summary Compensation Table and (c) all directors
and executive officers of the Company as a group (13 persons). Unless otherwise
indicated, each person named below and each person in the group named below has
sole voting and investment power with respect to the shares of Common Stock
indicated as beneficially owned by such person or such group.
Amount and Nature of Percent of
Beneficial Owner Beneficial Ownership Class
- - --------------------------------------------------------------------------------
Mark Abramowitz 17,600 (1) Less than 1%
John J. Macht 10,000 (1) Less than 1%
James Tulin 252,089 (2) 1.5%
John Tulin 3,958,839 (3) 23.7%
Marshall Tulin 4,416,376 (4) 26.4%
Raymond Vise 3,566,254 (5) 21.6%
Lewis Valenti 232,071 (6) 1.4%
Eric P. Luft 65,646 (7) Less than 1%
All directors and executive
officers as a group (13 persons) 6,082,628 (8) 34.3%
- - --------------------------------------------------------------------------------
(1) Includes 15,000 and 10,000 shares which Mssrs. Abramowitz and Macht,
respectively, have the right to acquire within 60 days through the exercise of
stock options.
(2) Includes 184,325 shares which Mr. Tulin has the right to acquire within 60
days through the exercise of stock options granted under the Plans, an aggregate
of 428 shares held by his children and an aggregate of 67,336 shares of Common
Stock allocated to his ESOP I account and 401(k) account under the Retirement
Plan.
(3) This amount includes the shares referred to in footnotes 3 and 5 to the
first table above under "Ownership of Voting Securities."
(4) This amount includes the shares referred to in footnotes 3 and 4 to the
first table above under "Ownership of Voting Securities."
(5) This amount includes the shares referred to in footnote 3 and 6 to the first
table above under "Ownership of Voting Securities."
(6) This amount includes 171,825 shares which Mr. Valenti has the right to
acquire within 60 days through the exercise of stock options granted under the
Plans and an aggregate of 60,246 shares of Common Stock allocated to his ESOP I
account and 401(k) account under the Retirement Plan.
(7) This amount includes 15,000 shares which Mr. Luft has the right to acquire
within 60 days through the exercise of stock options granted under the Plans and
an aggregate of 50,646 shares of Common Stock allocated to his ESOP I account
and 401(k) account under the Retirement Plan.
(8) This amount includes the shares referred to in footnote 3 to the first table
above under "Ownership of Voting Securities." This amount also includes
1,235,400 shares of Common Stock which directors and executive officers as a
group have the right to acquire within 60 days through the exercise of stock
options granted under the Plans and the 1994 Plan.
Pursuant to Section 16 of the Securities Exchange Act of 1934, as
amended, officers, directors and holders of more than 10% of the outstanding
shares of Common Stock are required to file periodic reports of their ownership
of, and transactions involving, the Common Stock with the Securities and
Exchange Commission. Based solely on its review of copies of such reports
received by the Company or written repre-
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<PAGE>
sentations from certain reporting persons that no Form 5 was required for those
persons, the Company believes that its reporting persons have complied with all
Section 16 filing requirements applicable to them with respect to the Company's
fiscal year ended December 31, 1996. The Company is not aware of any filing
delinquencies from prior fiscal years.
I. NOMINEES FOR ELECTION AS DIRECTORS
The Company's By-laws divide the Board of Directors into three classes,
designated as Class I, Class II and Class Ill, with each class to be as nearly
equal in number as possible. At each annual meeting of stockholders, directors
are elected for a term of three years to succeed those in the class whose terms
expire at such annual meeting.
At the Meeting, stockholders will elect two Class II directors to serve
for a term of three years, until the annual meeting of stockholders in the year
2000 and until the election and qualification of their respective successors.
Unless otherwise indicated thereon, all proxies received will be voted in favor
of the election of the nominees for election as directors. Should any of the
nominees not remain a candidate at the time of the annual meeting (a situation
which is not now anticipated), proxies solicited hereunder will be voted in
favor of those nominees who do remain as candidates and may be voted for any
substitute nominees. The affirmative vote of a plurality of votes cast at the
annual meeting is required to elect directors.
The following sets forth certain information about each nominee for
election as a director of the Company and each director whose term of office
will continue after the annual meeting, including his principal occupation or
employment.
Nominees:
John J. Macht - Class II
Mr. Macht, who is 60 years old , has been President of The Macht Group,
a marketing and retail consulting firm, since July 1992. From April 1991 until
July 1992 Mr. Macht served as Senior Vice President of Jordan Marsh department
stores, a division of Federated Department Stores. Mr. Macht became a director
in December 1995.
John Tulin (1) - Class II
Mr. Tulin, who is 50 years old, is President of the Company. He joined
the Company in 1971. He was elected a Vice President in 1974, a Senior Vice
President in 1979, Executive Vice President in 1982 and President on October
24,1995. Mr Tulin became a director in 1975.
Directors whose term of office will continue after the annual meeting:
Marshall Tulin (1) - Class III
Mr. Tulin, who is 79 years old, is Chairman of the Board of the
Company. He joined the Company in 1940, was elected a Vice President in 1954,
President in 1957 and Chairman of the Board on October 24, 1995. Mr. Tulin
became a director in 1956.
Raymond Vise (1)(2)(3) - CLASS III
Mr. Vise, who is 75 years old, served as Senior Vice President of the
Company for more than five years prior to his retirement in 1987. Mr. Vise
became a director in 1963.
Mark Abramowitz (2)(3) - CLASS I
Mr. Abramowitz, who is 61 years old, has been a partner in the law firm
of Parker Chapin Flattau & Klimpl, LLP for more than the past five years. The
firm is general counsel to the Company. Mr. Abramowitz became a director in
1987.
James Tulin (1) - CLASS I
Mr. Tulin, who is 46 years old, is a Senior Vice President of the
Company. He joined the Company in 1974, became a Regional Sales Manager in 1978
and was elected a Vice President in 1985 and a Senior Vice President in 1986.
Mr. Tulin became a director in 1985.
(1) Member of the Executive Committee of the Board.
(2) Member of the Audit Committee of the Board. There were 3 meetings of this
committee during the last fiscal year. This committee reviews the Company's
financial statements with the independent accountants prior to their submission
to the Board, recommends to the Board the appointment of the independent
accountants, reviews the performance and scope of services to be provided by the
independent accountants and reviews the adequacy of internal accounting
procedures and controls.
(3) Member of the Executive Compensation Committee of the Board. There was I
meeting of this committee during the last fiscal year. This committee recommends
the annual compensation, including bonuses, for the 3 executive officers of the
Company who are also directors, each of whom has an employment agreement with
the Company (see "Remuneration and Related Matters"), and for the Company's
Chief FinanciaL Officer.
There were 6 meetings of the Board during the last fiscal year. Each of
the directors attended at least 75% of the aggregate of all such Board meetings
and all meetings held by committees of the Board on which he served. The Company
does not have any nominating or similar committee.
There are no family relationships among any of the persons listed above
or among any of such persons and any of the other executive officers of the
Company, except that James Tulin and John Tulin are sons of Marshall Tulin.
REMUNERATION AND RELATED MATTERS
The following table sets forth certain summary information concerning
compensation during the fiscal year ended December 31, 1996 with respect to the
Company's Chief Executive Officer and each of the other
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<PAGE>
4 most highly compensated executive officers of the Company:
- - --------------------------------------------------------------------------------
I. SUMMARY COMPENSATION TABLE
- - --------------------------------------------------------------------------------
ANNUAL
COMPENSATION
- - --------------------------------------------------------------------------------
OTHER ALL
NAME AND ANNUAL OTHER
PRINCIPAL COMPEN- COMPEN-
POSITION YEAR SALARY BONUS SATION(6) SATION(9)
- - --------------------------------------------------------------------------------
Marshall Tulin (1) 1996 $360,000 $ -0- $ 7,442
Chairman of 1995 360,000 -0- 462
the Board 1994 360,000 250,000 18,489
John Tulin (2) 1996 220,000 50,000 $36,461(7) 7,442
President, Chief 1995 220,000 -0- 36,188(7) 462
Executive Officer 1994 220,000 185,000 18,189
Lewis Valenti (3) 1996 160,000 121,328 8,372
Senior Vice 1995 125,000 194,676 2,262
President 1994 80,000 294,110 17,789
Eric P. Luft (4) 1996 130,000 150,004 8,372
Senior Vice 1995 135,000 110,352 2,262
President 1994 135,000 172,527 16,089
James Tulin (5) 1996 190,000 40,000 41,217(8) 7,442
Senior Vice 1995 190,000 -0- 43,598(8) 462
President 1994 190,000 165,000 15,989
- - --------------------------------------------------------------------------------
(1) Mr. Tulin has an employment agreement with the Company which terminates on
June 30, 1998 providing for a salary at the rate of $360,000 per annum.
(2) Mr. Tulin has an employment agreement with the Company which terminates on
December 31,1998 providing for a salary at the rate (commencing February 1,
1997) of $300,000 per annum.
(3) The bonus amounts shown for Lewis Valenti include sales commissions in the
amounts of $96,328, $139,214 and $234,110 for the years 1996,1995 and 1994,
respectively.
(4) The bonus amounts shown for Eric P. Luft include sales commissions in the
amounts of $120,004, $110,352, and $107,527 for the years 1996,1995 and 1994,
respectively.
(5) Mr. Tulin has an employment agreement with the Company which terminates on
December 31,1998 providing for a salary at the rate (commencing February 1,
1997) of $240,000 per annum.
(6) Except as set forth for John Julin and James Tulin, perquisites and other
personal benefits did not exceed the lesser of $50,000 or 10% of reported annual
salary and bonus for any of the executive officers named in the "Summary
Compensation Table".
(7) These amounts include, for 1996, automobile lease payments of $18,927 and a
travel allowance of $9,000, and for 1995, automobile lease payments of $18,929
and a travel allowance of $9,450.
(8) This amount includes automobile lease payments of $17,394 in each of 1996
and 1995 and a travel allowance of $10,800 in 1996 and $14,500 in 1995.
(9) The amounts set forth for 1996, 1995 and 1994 represent allocations under
certain benefit plans of the Company as follows:
- - --------------------------------------------------------------------------
RETIREMENT PLAN DEFERRED
------------------------------- COMPEN-
ESOP I ESOP II 401(K) SATION
ACCOUNTS ACCOUNTS ACCOUNTS PLAN TOTAL
- - --------------------------------------------------------------------------
1996
- - ----
Marshall Tulin $7,262 $ 30 $ 150 $ 7,442
John Tulin 7,262 30 150 7,442
Lewis Valenti 7,262 60 1,050 8,372
Eric P. Luft 7,262 30 1,050 8,372
James Tulin 7,262 30 150 7,442
1995
- - ----
Marshall Tulin $ 359 $ 53 $ 50 $ 462
John Tulin 359 53 50 462
Lewis Valenti 359 53 50 $ 1,800 2,262
Eric P. Luft 359 53 50 1,800 2,262
James Tulin 359 53 462
1994
- - ----
Marshall Tulin 4,836 153 13,500 18,489
John Tulin 4,836 153 13,200 18,189
Lewis Valenti 4,836 153 1,800 11,000 17,789
Eric P. Luft 4,836 153 1,800 9,300 16,089
James Tulin 4,836 153 11,000 15,989
- - --------------------------------------------------------------------------
Each director who is not also an employee of, or counsel or a consultant
to, the Company receives a fee of $2,000 per meeting of the Board and of
committees of the Board attended by him. In addition, pursuant to the terms of
the 1994 Plan, each director who is not also an employee of the Company or any
subsidiary of the Company in office immediately following each annual meeting of
stockholders at which directors are elected will, effective on the date such
annual meeting is held, automatically be granted an option to purchase 5,000
shares of Common Stock. During the fiscal year ended December 31, 1996, Messrs.
Abramowitz, Macht and Vise were each granted an option to purchase 5,000 shares
of Common Stock at an exercise price per share of $.875, the fair market value
per share of Common Stock on the date of the grant. In addition, the Company and
John J. Macht are parties to an agreement pursuant to which Mr. Macht is
entitled to receive Compensation based on net sales of products under license
agreements entered into between the Company and licensors originally introduced
to the Company by Mr. Macht. Aggregate compensation during fiscal 1996 earned by
Mr. Macht under this arrangement was $8,487.
Robert Tulin (who is the brother of Marshall Tulin and uncle of John Tulin
and James Tulin) was employed by the Company during 1996. Robert Tulin is the
director of advertising and is responsible for coordinating the production of
the Company's merchandise catalogs. Aggregate Compensation paid Robert Tulin by
the Company for services rendered during 1996 amounted to $90,000.
The Company has entered into termination agreements with Messrs Marshall
Tulin John Tulin,
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Lewis Valenti, Eric P. Luft and James Tulin which expire on December 31, 1998.
In the event of a change in control (as defined in such agreements) of the
Company during the term of such agreements followed by a significant change in
the duties, powers or conditions of employment of any such officer, the officer
may within 2 years thereafter terminate his employment and receive a lump sum
payment equal to 2.99 times such officer's "base amount" (as defined in Section
280G(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code")).
In 1983 the Company terminated its pension plans covering salaried
employees and salesmen and purchased annuities from the assets of those plans to
provide for the payment (commencing at age 62) of accrued benefits of those
employees who were not entitled to or did not elect to receive lump sum
payments. The accrued annual benefits for Messrs. John Tulin, Lewis Valenti and
James Tulin are $13,116, $12,731, and $10,407, respectively.
During the Company's fiscal year ended December 31, 1996, no stock options
were granted to or exercised by any executive officers named in the Summary
Compensation Table. The following table sets forth certain information with
respect to the number and value of unexercised options held by such executive
officers as of December 31,1996:
1996 FISCAL YEAR END OPTION VALUES
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
FY-End (#) FY-End ($)
Exercisable/ Exercisable/
Name Unexercisable Unexercisable
- - ---- ------------- -------------
Marshall Tulin 211,209 / 0 0 / 0
John Tulin 192,209 / 0 0 / 0
Lewis Valenti 171,825 / 0 0 / 0
Eric P. Luft 15,000 / 0 0 / 0
James Tulin 184,325 / 0 0 / 0
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company's Executive Compensation Committee consists of Raymond Vise, a
former Senior Vice President of the Company, and Mark Abramowitz. The members of
the Company's Stock Option Committee and the Company's Incentive Share Committee
are Mr. John J. Macht and Mr. Vise. Until his death on June 1, 1996, William B.
MacLeod also served as a member of the Executive Compensation Committee, the
Stock Option Committee and the Incentive Share Committee. Ronald Vise (who is
the son of Raymond Vise) was employed by the Company during 1996 as a
commissioned salesman. Aggregate compensation paid to Ronald Vise for services
rendered during 1996 amounted to $159,896. Mark Abramowitz is a partner in the
law firm of Parker Chapin Flattau & Klimpl, LLP, which is retained by the
Company to provide legal services.
Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this Proxy Statement, in whole or in part, the following report and
the Performance Graph shall not be incorporated by reference into any such
filings.
REPORT OF BOARD AND COMPENSATION COMMITTEES
The Executive Compensation Committee of the Board of Directors, which is
comprised of two non-employee directors of the Company, determines, to the
extent not fixed pursuant to the terms of applicable employment agreements, the
compensation (other than through the grant of stock options) of the Chief
Executive Officer, other employee members of the Board of Directors, and the
Company's Chief Financial Officer. The entire Board of Directors is responsible
for developing executive compensation policies for the Company's other executive
officers. The Stock Option Committee, which is comprised of two non-employee
directors, administers the Company's 1981 Plan and 1987 Plan. The Incentive
Share Committee, which is comprised of two non-employee directors, administers
the Company's Incentive Share Plan (the "Incentive Plan").
The main objectives of the Company's executive compensation structure
include rewarding individuals for their respective contributions to the
Company's performance, providing executive officers with a stake in the
long-term success of the Company and providing compensation programs and
policies that will attract and retain qualified executive personnel.
Historically, the members of the Board of Directors and the Executive
Compensation, Stock Option and Incentive Share Committees have chosen to achieve
these objectives through salary increases, bonuses under the Company's incentive
compensation program, contractual protections against changes in or loss of
employment in case of a change of control of the Company and periodic stock
option grants.
The Board of Directors and the Executive Compensation, Stock Option and
Incentive Share Committees believe that their deliberations should include,
among other things, due consideration to the performance of the Company, as well
as compensation levels in competing companies, individual contributions and the
executives' respective lengths of service with the Company. The salary of John
Tulin, President and Chief Executive Officer of the Company, was fixed in fiscal
1996 pursuant to the terms of an employment agreement. The Executive
Compensation Committee of the Board of Directors, however, awarded Mr. Tulin a
bonus of $50,000 for the fiscal year ended December 31, 1996. In determining to
grant Mr. Tulin a bonus, the Executive Compensation Committee particularly noted
the Company's significantly improved operating results in fiscal 1996, which was
reflected in net income of $1,299,000 ($ 08 per share) during that fiscal year,
5
<PAGE>
compared with a fiscal 1995 loss of $8,944,000 ($.55 per share), as well as Mr.
Tulin's central role in the completion of a new three year financing arrangement
with the Company's bank lenders and in the implementation of continuing programs
to reduce overhead and improve asset management.
Compensation through the periodic grant of stock options under the
Company's stock option plans is intended to coordinate executives' and
stockholders' long-term interests by creating a direct link between a portion of
executive compensation and increases in the price of Common Stock and the
long-term success of the Company. No stock options were granted to any named
executive officer of the Company during fiscal 1996.
BOARD EXECUTIVE STOCK OPTION
OF COMPENSATION AND INCENTIVE
DIRECTORS COMMITTEE SHARE COMMITTEES
--------- --------- ----------------
Mark Abramowitz Mark Abramowitz John J. Macht
John J. Macht Raymond Vise Raymond Vise
James Tulin
John Tulin
Marshall Tulin
Raymond Vise
PERFORMANCE GRAPH
COMPARISON OF 5 YEAR CUMULATIVE
TOTAL RETURN OF COMPANY, PEER GROUP
AND BROAD MARKET
ASSUMES $100 INVESTED ON JANUARY 1, 1992
ASSUMES DIVIDEND REINVESTED
FISCAL YEAR ENDING DECEMBER 31, 1996
The peer group includes companies that compete with the Company in one or
more of its product categories as well as companies in similar industries. The
peer group includes: Jaclyn, Inc., Comforce Corp. (formerly The Lori
Corporation) and Salant Corp.
Note: The stock price performance shown on the graph above is not necessarily
indicative of future price performance.
II. APPROVAL OF INDEPENDENT ACCOUNTANTS
There will also be brought up for consideration at the Meeting the approval
of the appointment of accountants to perform the annual audit for the fiscal
year ending December 31, 1997, Subject to the action of the stockholders at the
Meeting, the Board has appointed the firm of Coopers & Lybrand L.L.P., certified
public accountants, as the independent accountants to audit the financial
statements of the Company for the current fiscal year. They have been the
Company's accountants since 1952. The board recommends their approval. A
representative of Coopers & Lybrand L.L,P. is expected to be present at the
Meeting. Such representative will have the opportunity to make a statement if he
or she so desires and will be available to respond to appropriate questions.
STOCKHOLDER PROPOSALS
In order to be included in the proxy materials for the 1998 Annual Meeting
of Stockholders of the Company, stockholder proposals must be received by the
Company on or before November 25,1997.
GENERAL
The accompanying proxy will be voted as specified by stockholders. If no
specification is made, it is intended that the proxy will be voted FOR the
election of directors and FOR the approval of the appointment of Coopers &
Lybrand L.L,P, as the independent accountants of the Company.
Shares of Common Stock that are voted to abstain and broker non-votes will
be considered present at the Meeting in determining the presence of a quorum.
Shares abstaining with respect to any matter will be considered entitled to vote
and cast with respect to that matter. Shares subject to broker non-votes with
respect to any matter will not be considered entitled to vote with respect to
such matter.
The Board does not know of any other matter to be brought before the
meeting. If any other matters are properly brought before the meeting, the
persons named in the enclosed proxy intend to vote such proxy in accordance with
their best judgment on such matters.
By Order of the Board of Directors
Christopher F. Wolf
Secretary
March 24, 1997
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SWANK, INC.
6 HAZEL STREET, ATTLEBORO, MASSACHUSETTS 02703
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Marshall Tulin and John
Tulin, and each of them, with full power of substitution, the attorneys and
proxies of the undersigned, to attend the 1997 Annual Meeting of Stockholders of
SWANK, INC. (the "Company") to be held at the Company's offices at 6 Hazel
Street, Attleboro, Massachusetts 02703, on April 24, 1997 at 11:00 A.M. local
time, and all adjournments thereof, to vote all shares of Common Stock of the
Company which the undersigned may be entitled to vote upon the following
matters:
(PLEASE SIGN AND DATE ON THE REVERSE SIDE)
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Please mark your
A [X] votes as in this
example.
FOR WITHHOLD NOMINEES: John J. Macht
(except as indicated to AUTHORITY
the contrary below) TO VOTE FOR John Tulin
1. Election of two
(2) Class II [ ] [ ]
directors to
serve on the Company's Board of Directors:
For, except vote withheld from the following nominees(s)
_________________________________________________________
FOR AGAINST ABSTAIN
2. The approval of the appointment of Coopers & [ ] [ ] [ ]
Lybrand L.L.P. as the independent
accountants of the Company for the year
1997; and
3. The transaction of such other business as may properly come before the
meeting.
UNLESS OTHERWISE INDICATED, THE PROXY WILL BE VOTED "FOR" THE ELECTION OF THE
NOMINEES FOR DIRECTOR, "FOR" ITEM 2 AND WITH DISCRETION ON SUCH OTHER BUSINESS
AS MAY PROPERLY COME BEFORE THE MEETING.
ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. IF YOU DO NOT
EXPECT TO BE PRESENT, PLEASE DATE AND SIGN THIS FORM OF PROXY AND RETURN IT
PROMPTLY TO THE COMPANY IN THE ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED.
SIGNATURE___________________ DATE_____ SIGNATURE__________________ DATE_________
(SIGNATURE IF HELD JOINTLY)
NOTE: Please sign exactly as name appears hereon. Joint owners should each sign.
When signing as attorney, executor, administrator, trustee, guardian or
corporate officer, please give full title as such.
