-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HnjGFdGA3EjNoocqFoJVrST0woEFhqrl8qztj2w8rsxPLKp99f8Ud71d474tusWq x4+tbaecGMIHyymnqENPBg== 0000950152-97-003511.txt : 19970505 0000950152-97-003511.hdr.sgml : 19970505 ACCESSION NUMBER: 0000950152-97-003511 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970605 FILED AS OF DATE: 19970502 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FABRI CENTERS OF AMERICA INC CENTRAL INDEX KEY: 0000034151 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-MISCELLANEOUS SHOPPING GOODS STORES [5940] IRS NUMBER: 340720629 STATE OF INCORPORATION: OH FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-06695 FILM NUMBER: 97594218 BUSINESS ADDRESS: STREET 1: 5555 DARROW RD CITY: HUDSON STATE: OH ZIP: 44236 BUSINESS PHONE: 2166562600 MAIL ADDRESS: STREET 1: 5555 DARROW ROAD CITY: HUDSON STATE: OH ZIP: 44236 FORMER COMPANY: FORMER CONFORMED NAME: CLEVELAND FABRIC SHOPS INC DATE OF NAME CHANGE: 19681216 FORMER COMPANY: FORMER CONFORMED NAME: CLEVELAND FABRIC SHOPS INC NUMBER THREE DATE OF NAME CHANGE: 19681216 DEF 14A 1 FABRI-CENTERS OF AMERICA, INC. DEFINITIVE PROXY 1 ================================================================================ SCHEDULE 14A (RULE 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 Section 240.14a-11(c) or Section 240.14a-12
FABRI-CENTERS OF AMERICA, INC. (NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) FABRI-CENTERS OF AMERICA, INC. (NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT) Payment of Filing Fee (Check the appropriate box): [X] No fee required. [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: ....... (2) Aggregate number of securities to which transaction applies: .......... (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is calculated and state how it was determined): ............ (4) Proposed maximum aggregate value of transaction: ...................... (5) Total fee paid: ....................................................... [ ] Fee paid previously with preliminary materials. [ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. (1) Amount Previously Paid: ............................................... (2) Form, Schedule or Registration Statement No.: ......................... (3) Filing Party: ......................................................... (4) Date Filed: ........................................................... ================================================================================ 2 [FABRI-CENTERS LOGO] 5555 Darrow Road Hudson, Ohio 44236 NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 5, 1997 The Annual Meeting of Shareholders of Fabri-Centers of America, Inc. will be held at Fabri-Centers' Corporate Office, 5555 Darrow Road, Hudson, Ohio, on Thursday, June 5, 1997, at 1:00 p.m., local time, for the following purposes: 1. To elect three Directors of the class whose three-year terms of office will expire in 2000; and 2. To transact such other business as may properly come before the meeting. All shareholders are cordially invited to attend the meeting, although only those holders of Class A Common Shares of record at the close of business on April 7, 1997 will be entitled to vote at the meeting. IF YOU ARE A HOLDER OF CLASS A COMMON SHARES, YOU WILL ALSO FIND ENCLOSED A PROXY CARD. YOUR VOTE IS IMPORTANT. PLEASE COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY IN THE RETURN ENVELOPE PROVIDED FOR THAT PURPOSE, WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING. IF YOU ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE YOUR CLASS A COMMON SHARES IN PERSON. The Proxy Statement accompanies this Notice. BETTY ROSSKAMM, Secretary May 2, 1997 By Order of the Board of Directors 3 [FABRI-CENTERS LOGO] 5555 Darrow Road Hudson, Ohio 44236 1997 ANNUAL MEETING OF SHAREHOLDERS JUNE 5, 1997 THE PROXY AND This Proxy Statement is being mailed on or about May 2, 1997, SOLICITATION to the shareholders of Fabri-Centers of America, Inc. (the "Company") in connection with the solicitation by the Board of Directors of the enclosed form of Proxy for the 1997 Annual Meeting of Shareholders to be held on June 5, 1997 (the "Annual Meeting"). If you are a holder of the Company's Class A Common Stock, without par value ("Class A Common Shares"), you will also find enclosed a proxy card and an envelope in which to return it. Pursuant to the Ohio General Corporation Law, any holder of Class A Common Shares signing and returning the enclosed Proxy has the power to revoke it by giving notice of such revocation to the Company in writing or in the open meeting before any vote with respect to the matters set forth therein is taken. The representation in person or by proxy of at least a majority of the outstanding Class A Common Shares entitled to vote is necessary to provide a quorum at the Annual Meeting. The nominees for Directors receiving the greatest number of votes will be elected. As a result, any Class A Common Shares present in person or by proxy at the Annual Meeting but not voted for any reason have no impact in the election of Directors, except to the extent that the failure to vote for an individual may result in another individual receiving a larger number of votes. PURPOSES OF The Annual Meeting has been called for the purposes of (1) ANNUAL MEETING electing three Directors of the class whose three-year terms of office will expire in 2000; and (2) transacting such other business as may properly come before the meeting. The three persons named in the enclosed Proxy have been selected by the Board of Directors and will vote Class A Common Shares represented by valid Board of Directors' Proxies. They have indicated that, unless otherwise indicated in the enclosed Proxy, they intend to vote for the election of the nominees listed below. The Company has no knowledge of any other matters to be presented at the Annual Meeting, except the reports of officers on which no action is proposed to be taken. In the event that other matters do properly come before the Annual Meeting, the persons named in the Proxy will vote in accordance with their judgment on such matters. VOTING The Board of Directors has fixed the close of business on SECURITIES April 7, 1997, as the record date for determining shareholders entitled to notice of, and to vote at, the Annual Meeting. On that date, the Company had outstanding and entitled to vote at the Annual Meeting 9,080,331 Class A Common Shares. Each Class A Common Share entitles the holder to one vote on all matters properly brought before the meeting. Pursuant to the Amended Articles of Incorporation of the Company, shares of the Company's Class B Common Stock, without par value ("Class B Common Shares"), do not entitle the holders thereof to vote on any matter submitted to the shareholders, except in certain circumstances set forth in the Ohio General Corporation Law, none of which are applicable to the Annual Meeting (Class A Common Shares and Class B Common Shares are hereafter 1 4 sometimes collectively referred to as "Common Stock"). Under the Ohio General Corporation Law, all of the Class A Common Shares may be voted cumulatively in the election of Directors if any shareholder gives written notice to the President, a Vice President or the Secretary of the Company, not less than 48 hours before the time set for the Annual Meeting, and an announcement of the notice is made at the beginning of the Annual Meeting by the Chairman or the Secretary or by or on behalf of the shareholder giving such notice. Cumulative voting permits a shareholder to (1) cast a number of votes equal to the number of Class A Common Shares owned by the shareholder multiplied by the number of Directors to be elected and (2) cast those votes for only one nominee or distribute them among the nominees. In the event that voting at the election is cumulative, the persons named in the enclosed Proxy will vote the Class A Common Shares represented by valid Proxies on a cumulative basis for the election of the nominees listed below, allocating the votes of such Class A Common Shares in accordance with their judgment. Shareholders of the Company will not be entitled to dissenters' rights with respect to any matter to be considered at the Annual Meeting. SECURITY The following table sets forth, as of April 7, 1997, the OWNERSHIP OF amount of the Company's Common Stock beneficially owned by MANAGEMENT each of its Directors and nominees for Directors, the Chief Executive Officer, the four other most highly compensated executive officers, and all executive officers and Directors of the Company as a group. Unless otherwise indicated, each of the persons listed in the following table has sole voting and investment power with respect to the Common Stock set forth opposite his or her name:
CLASS A COMMON SHARES CLASS B COMMON SHARES ---------------------------------- ---------------------------------- NUMBER OF PERCENT OF NUMBER OF PERCENT OF NAME OF COMMON SHARES CLASS IF 1% COMMON SHARES CLASS IF 1% BENEFICIAL OWNER BENEFICIALLY OWNED OR MORE BENEFICIALLY OWNED OR MORE - ---------------------------------------------- ----------- ------------------ ----------- Betty Rosskamm(1)(2)........ 876,453 9.65% 727,526 8.09% Alan Rosskamm(1)(3)......... 660,018 7.14% 607,531 6.63% Alma Zimmerman(1)........... 550,585 6.06% 534,287 5.94% Jane Aggers (1)(4).......... 139,101 1.52% 153,269 1.69% John Hermsen (1)(5)......... 52,500 -- 12,500 -- John Stec(1)(6)............. 33,931 -- 32,628 -- Samuel Krasney(7)........... 22,250 -- 22,250 -- Ira Gumberg(8).............. 21,000 -- 21,000 -- Samuel R. Gaston(1)(9)...... 20,000 -- -- -- Scott Cowen(8).............. 17,300 -- 17,300 -- Frank Newman(8)............. 15,000 -- 15,000 -- Gregg Searle................ 1,000 -- -- -- All executive officers and Directors as a group (12 persons).................. 2,409,138(1)(10) 25.55%(10) 2,143,291(1)(10) 22.89%(10)
- --------------- (1) With respect to Common Stock beneficially owned by such persons under the Company's Employees' Savings and Profit Sharing Plan, the shares of Common Stock included are as of December 31, 1996, the latest date for which statements are available. (2) Includes 20,903 Class A Common Shares and 26,541 Class B Common Shares held by Mrs. Rosskamm as custodian for the benefit of her grandchildren, 25,000 Class A Common Shares and 25,000 Class B Common Shares held by The Rosskamm Family Partnership, with regard to which Mrs. Rosskamm has sole voting and dispositive power and 25,500 Class A Common Shares and 25,500 Class B Common Shares held by Rosskamm Family Partners, L.P., with regard to which Mrs. Rosskamm has shared voting and dispositive power. 2 5 (3) Includes 164,750 Class A Common Shares and 177,250 Class B Common Shares subject to stock options granted to Mr. Rosskamm exercisable on or prior to June 5, 1997, 12,500 Class A Common Shares and 12,500 Class B Common Shares held as restricted stock under the Company's Executive Incentive Plan, an aggregate of 181,751 Class A Common Shares and 218,629 Class B Common Shares held by his children, spouse, or by Mr. Rosskamm as trustee for the benefit of family members and charities and 25,500 Class A Common Shares and 25,500 Class B Common Shares held by Rosskamm Family Partners, L.P., with regard to which Mr. Rosskamm has shared voting and dispositive power. (4) Includes 82,500 Class A Common Shares and 92,500 Class B Common Shares subject to stock options granted to Ms. Aggers exercisable on or prior to June 5, 1997 and 35,000 Class A Common Shares and 25,000 Class B Common Shares held as restricted stock under the Company's Executive Incentive Plan. (5) Includes 12,500 Class A Common Shares and 12,500 Class B Common Shares subject to stock options granted to Mr. Hermsen exercisable on or prior to June 5, 1997 and 40,000 Class A Common Shares held as restricted stock under the Company's Executive Incentive Plan. (6) Includes 24,750 Class A Common Shares and 27,250 Class B Common Shares subject to stock options granted to Mr. Stec exercisable on or prior to June 5, 1997 and 4,000 Class A Common Shares and 4,000 Class B Common Shares held as restricted stock under the Company's Executive Incentive Plan. (7) Includes 20,000 Class A Common Shares and 20,000 Class B Common Shares subject to stock options granted to Mr. Krasney under the Stock Option Plan for Non-Employee Directors exercisable on or prior to June 5, 1997. (8) Includes 15,000 Class A Common Shares and 15,000 Class B Common Shares subject to stock options granted to Mr. Gumberg, Mr. Newman, and Mr. Cowen under the Stock Option Plan for Non-Employee Directors exercisable on or prior to June 5, 1997. (9) Includes 20,000 Class A Common Shares held as restricted stock by Mr. Gaston under the Company's Executive Incentive Plan. (10) Includes 349,500 Class A Common Shares and 374,500 Class B Common Shares subject to stock options granted under the Company's Stock Option Plans and exercisable on or prior to June 5, 1997 and 111,500 Class A Common Shares and 41,500 Class B Common Shares of restricted stock awarded under the Company's Executive Incentive Plan. 3 6 SECURITY Unless otherwise indicated, the following table and notes OWNERSHIP OF thereto set forth information as to the only persons or CERTAIN BENEFICIAL groups known to the Company, as of April 7, 1997, to be OWNERS beneficial owners (as defined by the Securities and Exchange Commission) of more than five percent of the outstanding Class A Common Shares of the Company. The information provided in connection with this table has been obtained from the Company's records and a review of statements filed with the Securities and Exchange Commission. Unless otherwise indicated, each of the owners listed in the following table has sole voting and investment power with respect to the Class A Common Shares set forth opposite their names:
CLASS A COMMON SHARES ------------------------------- NUMBER OF NAME AND ADDRESS COMMON SHARES PERCENT OF BENEFICIAL OWNERS BENEFICIALLY OWNED OF CLASS ------------------------------------------------------- ------------------ -------- Manning & Napier Advisors, Inc.(1)(2).................. 887,325 9.78% 1100 Chase Square Rochester, NY 14604 Mrs. Betty Rosskamm(3)(4).............................. 876,453 9.65% 5555 Darrow Road Hudson, OH 44236 First Pacific Advisors, Inc. (1)....................... 709,810 7.82% 11400 West Olympic Boulevard Suite 1200 Los Angeles, CA 90064 Mr. and Mrs. Justin Zimmerman(3)(5).................... 692,178 7.62% 5555 Darrow Road Hudson, OH 44236 FMR Corp.(1)(6)........................................ 676,800 7.45% Edward C. Johnson 3d 82 Devonshire Street Boston, MA 02109 Mr. Alan Rosskamm (3)(7)............................... 660,018 7.14% 5555 Darrow Road Hudson, OH 44236 The State Teachers Retirement.......................... 553,900 6.10% Board of Ohio(STRS)(8) 275 East Broad Street Columbus, OH 43215 The Capital Group Companies, Inc.(1)(9)................ 525,610 5.79% 333 South Hope Street Los Angeles, CA 90071
- --------------- (1) The Class A Common Shares listed are reported on a Schedule 13G filed with the Securities and Exchange Commission with respect to holdings as of December 31, 1996. (2) Of the 887,325 Class A Common Shares beneficially owned, Manning & Napier Advisors, Inc. has sole voting power with regard to 881,375 Class A Common Shares and sole dispositive power with regard to 887,325 Class A Common Shares. (3) With respect to Class A Common Shares beneficially owned by such persons under the Company's Employees' Savings and Profit Sharing Plan, the Class A Common Shares included are as of December 31, 1996, the latest date for which statements are available. (4) Includes 20,903 Class A Common Shares held by Mrs. Rosskamm as custodian for the benefit of her grandchildren, 25,000 Class A Common Shares held by The Rosskamm Family 4 7 Partnership, with regard to which Mrs. Rosskamm has sole voting and dispositive power and 25,500 Class A Common Shares held by Rosskamm Family Partners, L.P., with regard to which Mrs. Rosskamm has shared voting and dispositive power. (5) Of the 692,178 Class A Common Shares, Mr. Zimmerman disclaims beneficial ownership of 550,585 Class A Common Shares beneficially owned by his wife and Mrs. Zimmerman disclaims beneficial ownership of 141,593 Class A Common Shares beneficially owned by her husband. (6) Fidelity Management & Research Company, a wholly owned subsidiary of FMR Corp. ("Fidelity"), reported beneficial ownership of 476,100 Class A Common Shares as a result of acting as investment advisor to several investment funds that hold such Class A Common Shares (the "Funds"). The voting of these 476,100 Class A Common Shares is directed by each of the Funds' Boards of Trustees. In addition, Fidelity Management Trust Company, a wholly owned subsidiary of FMR Corp. ("FMTC"), reported beneficial ownership of 200,700 Class A Common Shares. The voting of these 200,700 Class A Common Shares is directed by FMR who has sole voting and dispositive power over these shares. (7) Includes 164,750 Class A Common Shares subject to stock options granted to Mr. Rosskamm exercisable on or prior to June 5, 1997, 12,500 Class A Common Shares held as restricted stock under the Company's Executive Incentive Plan, an aggregate of 181,751 Class A Common Shares held by his children, spouse, or by Mr. Rosskamm as trustee for the benefit of family members and charities and 25,500 Class A Common Shares held by Rosskamm Family Partners, L.P., with regard to which Mr. Rosskamm has shared voting and dispositive power. (8) The Class A Common Shares listed are reported on a Schedule 13G filed with the Securities and Exchange Commission with respect to holdings as of December 31, 1993. No subsequent amendment to the Schedule 13G has been filed of record with the Securities and Exchange Commission. (9) Capital Research and Management Company, a registered investment adviser, and an operating subsidiary of The Capital Group Companies, Inc., exercised as of December 31, 1996 investment discretion with respect to 525,610 Class A Common Shares or 5.79% of outstanding shares of the class, which were owned by various institutional investors. Such subsidiary has no power to direct the vote of the above shares. 5 8 ELECTION OF The Board of Directors of the Company consists of nine members DIRECTORS divided into three classes, each consisting of three members. Since a suitable replacement nominee has yet to be found following the 1996 resignation of Robert Norton, a vacancy will remain in the class of 1998. The proxies solicited hereby will not be voted for a greater number of persons than the number of nominees named herein. In the event of the death of or inability to serve of any of the nominees, the Proxies will be voted for the election as a Director of such other person as the Board of Directors may recommend. The Board of Directors has no reason, however, to anticipate that this will occur. NOMINEES TO The following table sets forth certain information regarding THE BOARD the nominees for election as members of the Board of Directors OF DIRECTORS and Directors whose terms of office will continue after the Annual Meeting, based upon information furnished to the Company by such persons, except as otherwise noted, as of April 7, 1997.
PRINCIPAL OCCUPATION PAST FIVE YEARS, DIRECTOR NAME OTHER DIRECTORSHIPS AND AGE SINCE ---- ------------------------------------- -------- NOMINEES FOR THE TERM TO EXPIRE IN 2000 Alan Rosskamm Chief Executive Officer of the Company for more than five 1985 years, since April 1993, President, and since July 1992, Chairman of the Board; prior to July 1992, President of the Company for more than five years; Director of Charming Shoppes Inc. (women's apparel retailer); age 47. Scott Cowen Dean of the Weatherhead School of Management and A.J. 1987 (1)(2)(3) Weatherhead Professor of Management, Case Western Reserve University, for more than five years; Director of American Greetings Corporation, Forest City Enterprises, Inc., KeyBank N.A. and Rubbermaid Inc.; age 50. Gregg Searle President and Chief Operating Officer since November, 1996, 1996 (1)(2)(3) Executive Vice President August 1993 to February 1996 of Diebold Incorporated; Vice President of Diebold, Inc. and General Manager of InterBold January 1992 to August 1993; Director of Diebold, Incorporated since November 1996; age 48. DIRECTORS WHOSE TERMS EXPIRE IN 1998 Alma Zimmerman Senior Vice President of the Company for more than five 1967 years; age 84. Ira Gumberg Chief Executive Officer and President of J.J. Gumberg Co. 1992 (1) (3) (real estate management and development) for more than five years; Director of Mellon Bank, N.A.; age 43.
6 9
PRINCIPAL OCCUPATION PAST FIVE YEARS, DIRECTOR NAME OTHER DIRECTORSHIPS AND AGE SINCE ---- ------------------------------------- -------- DIRECTORS WHOSE TERMS EXPIRE IN 1999 Samuel Krasney Managing Partner, ABBA Capital Enterprises since September 1976 (1) (2) (3) 1993; Chairman of the Board, President and Chief Executive Officer, Banner Aerospace, Inc. from June 1990 to September 1993; Director of Banner Aerospace, Inc., and Waxman Industries, Inc.; age 72. Frank Newman Chairman of the Board since February 1997, President and 1991 (1)(2)(3) Chief Executive Officer since February 1996, Chief Operating Officer from July 1993 to February 1996, Director of Eckerd Corporation (retail pharmacy stores) since July 1993; President and Chief Executive Officer, F & M Distributors prior to July 1993 for more than five years; age 48. Betty Rosskamm Senior Vice President and Secretary of the Company for more 1967 than five years; age 68.
- --------------- (1) Member of the Audit Committee, which met three times during the fiscal year ended February 1, 1997. This Committee is responsible for reviewing with the independent auditors of the Company the scope and thoroughness of the auditors' examination, reviewing the adequacy of the Company's systems of internal accounting controls with the independent auditors and recommending to the Board of Directors the appointment of independent auditors for the fiscal year. (2) Member of the Compensation Committee, which met four times during the fiscal year ended February 1, 1997. This Committee has the authority to set the compensation for executive officers of the Company. The Committee also makes recommendations to the Board of Directors with respect to the adoption and amendment of incentive compensation plans and administers those plans approved by the Board of Directors. (3) Member of the Nominating Committee, which met three times during the fiscal year ended February 1, 1997. This Committee has the authority to interview and recommend to the Board of Directors for nomination on behalf of the Board suitable persons for election as directors when a vacancy exists on the Board. The Board of Directors will also consider individuals recommended by shareholders of the Company. Such recommendations should be submitted in writing to the Chairman of the Board, who will submit them to the entire Board for its consideration. The recommendations must be accompanied by the consent of the individual nominated to be elected and to serve. Betty Rosskamm is the mother of Alan Rosskamm. Concurrently with the Company's settlement of allegations by the Securities and Exchange Commission in February 1997, Mr. Rosskamm consented to a separate SEC administrative cease and desist order settling certain allegations by the SEC, without admitting or denying the allegations. The SEC contended that Mr. Rosskamm violated certain federal securities laws as a result of his not making adequate inquiry of his financial staff before signing management representation letters given to the Company's auditors in connection with the 1992 offering of 6 1/4% Convertible Subordinated Debentures, and as a result of signing the Company's Form 10-Q for the quarter ended May 2, 1992. Ira Gumberg, a Director of the Company, is President and a principal shareholder of J.J. Gumberg Co. J.J. Gumberg Co. manages numerous shopping centers, 13 of which contain fabric stores of the Company. All but three of the leases with respect to such stores were entered into prior to Mr. Gumberg becoming a Director of the Company. The aggregate rent paid during fiscal 1997 on these 13 stores amounted to $928,000. 7 10 During fiscal year 1997, Robert Norton, who resigned as a Director and Vice Chairman of the Board, and Chief Financial Officer of the Company, received severance benefits from the Company pursuant to his employment agreement, including the continuation of his salary of $355,000 and certain health and life insurance benefits. During the fiscal year ended February 1, 1997, there were four meetings of the Company's Board of Directors. Each incumbent Director attended at least 75% of the Board meetings and meetings held by the committees on which he or she served. SECTION 16(a) Based solely upon a review of Forms 3 and 4 and amendments BENEFICIAL thereto furnished to the Company with respect to its most OWNERSHIP recent fiscal year, and written representations from reporting REPORTING persons that no Form 5 was required, the Company believes COMPLIANCE that, during the fiscal year ended February 1, 1997, all filing requirements applicable to its executive officers and Directors were met. DIRECTORS' The Company compensates Directors, other than officers who are COMPENSATION Directors, for their services on the basis of a $16,000 annual retainer and $1,000 for each day of Board and committee meetings attended. The Company also maintains the 1996 Stock Option Plan for Non-Employee Directors (the "Directors Plan"), which provides automatic one-time grants of options for 7,500 Class A Common Shares and 7,500 Class B Common Shares to new Non-Employee Directors as of the date of their initial election and automatic grants of options for 1,500 Class A Common Shares and 1,500 Class B Common Shares to each Non-Employee Director upon completion of each year of service (commencing in 1997) as a Director. A total of 92,500 Class A Common Shares and 92,500 Class B Common Shares are currently available for issuance upon the exercise of options granted or which may be granted under the Directors Plan. Each option will terminate on the date that is ten years following the date of grant; provided, that, in the event of the retirement of a Director after more than ten years of continuous service, the Compensation Committee may accelerate the date on which any option (outstanding for a period of more than twelve months) becomes exercisable. When an optionee ceases to be a Director of the Company for any reason, that optionee shall continue to have the right to exercise an outstanding option during the three-month period immediately following the date of termination of such service. 8 11 EXECUTIVE The following table sets forth information relating to the COMPENSATION annual and long-term compensation for the fiscal years ended February 1, 1997, January 27, 1996 and January 28, 1995, for the Chief Executive Officer and the other four most highly compensated executive officers of the Company: SUMMARY COMPENSATION TABLE
LONG TERM COMPENSATION ANNUAL COMPENSATION AWARDS - ------------------------------------------------------------------------------ --------------------------------- OTHER SECURITIES ALL ANNUAL UNDERLYING OTHER COMPEN- RESTRICTED OPTIONS/SARS COMPEN- NAME AND FISCAL SATION STOCK (E) SATION PRINCIPAL POSITION YEAR SALARY(A) BONUS(B) (C) AWARD(S)(D) (COMMON SHARES) (F) - ---------------------------- ------ --------- -------- -------- ----------- ----------------- -------- CLASS A CLASS B ------- ------- Alan Rosskamm 1997 $409,751 $310,846 -- $ 0 0 35,000 $ 84,634 Chairman of the Board, 1996 $396,109 $259,994 -- $ 0 0 50,000 $ 64,991 President and Chief 1995 $352,884 $264,663 -- $ 196,875 15,000 15,000 $ 79,144 Executive Officer Jane Aggers 1997 $301,110 $229,385 -- $ 0 0 25,000 $ 17,760 Executive Vice 1996 $294,096 $192,518 -- $ 0 0 40,000 $ 17,760 President, 1995 $246,712 $185,034 -- $ 236,250 12,000 12,000 $ 19,194 Merchandising and Marketing John Hermsen (1) 1997 $296,625 $224,639 -- $ 0 0 25,000 $ 13,963 Executive Vice 1996 $136,154 $30,270 19,520 $ 486,252 50,000 50,000 $ 79,520 President-Stores Samuel R. Gaston (1) 1997 $134,495 $101,841 -- $ 285,000 50,000 65,000 $223,330 Executive Vice President, Chief Financial Officer John Stec 1997 $187,550 $92,067 -- $ 0 0 7,500 $ 2,250 Senior Vice President- 1996 $178,269 $76,656 -- $ 0 0 10,000 $ 2,400 Real Estate............... 1995 $170,000 $94,150 -- $ 63,000 5,000 5,000 $ 1,808
- --------------- (1) Mr. Hermsen's employment commenced August 11, 1995 and Mr. Gaston's employment commenced August 19, 1996. (A) Includes amounts earned but deferred pursuant to Section 401(k) of the Internal Revenue Code. (B) Incentive Bonus Compensation is based on individual percentages established by the Compensation Committee and is based on achievement of pre-established performance goals. Amounts represent bonuses earned in the current fiscal year for which payment is not made until the subsequent fiscal year. (C) Excludes perquisites and other benefits, unless the aggregate amount of such compensation is greater than the lesser of $50,000 or 10 percent of the total of annual salary and bonus reported for the named executive officer. (D) Restricted stock consists of Common Stock issued and delivered to the recipient at the time the award is made without payment to the Company, but which are subject to restrictions on transfer for, and forfeiture in the event of termination of employment prior to the expiration of, a specified period of time (generally at the end of a period of five years). The amounts reported in the table represent the market value at the date of grant. For the fiscal years 1997, 1996, and 1995, the executive officers listed in the compensation table received the following numbers of restricted shares, respectively: Alan Rosskamm -- 0, 0, 12,500 Class A Common Shares and 0, 0, 12,500 Class B Common Shares; Jane Aggers -- 0, 0, 15,000 Class A Common Shares and 0, 0, 15,000 Class B Common Shares; John Hermsen -- 0, 40,000, 0 Class A Common Shares and 0, 0, 0 Class B Common Shares; Samuel R. Gaston -- 20,000, 0, 0 Class A Common Shares and 0, 0, 0 Class B Common Shares; John Stec -- 0, 0, 4,000 Class A Common Shares and 0, 0, 4,000 Class B Common Shares. The aggregate number and value of the restricted stock holdings at February 1, 1997 were for Mr. Rosskamm 24,500 Class A Common Shares at $392,000 and 24,500 Class B Common Shares at $367,500, Ms. Aggers 30,000 Class A Common Shares at $480,000 and 30,000 Class B Common Shares at $450,000, Mr. Hermsen 40,000 Class A Common Shares at $640,000, Mr. Gaston 20,000 Class A Common Shares at $320,000, and Mr. Stec 4,000 Class A Common Shares at $64,000 and 4,000 Class B Common Shares at $60,000, without giving effect to the diminution of value attributable to the restrictions on such shares. Currently, the Company does not pay cash dividends on its Common Stock; however, from time to time the Board of Directors may re-examine the 9 12 issue of dividend payments. The shares of restricted stock would participate the same as other shares of Common Stock of the Company regarding dividend payment. (E) The Company's 1990 Employees Stock Option and Stock Appreciation Rights Plan, as amended, provides for the award of incentive and non-qualified stock options which may be Class A Common Shares or Class B Common Shares or a combination thereof and stock appreciation rights to key employees of the Company. (F) Reflects matching contributions, equal to 50% of a participant's first 4% under the Company's Employees' Savings and Profit Sharing Plan and amounts accrued by the Company for potential benefits earned under the Company's 1979 Supplemental Retirement Benefit Plan (the "1979 Plan"). The 1979 Plan provides benefits, subject to forfeiture, to such employees upon normal retirement, early retirement, death or total disability. In fiscal years 1997, 1996 and 1995, the Company had accrued, under the 1979 Plan, for the executive officers listed in the compensation table, the following amounts, respectively: Alan Rosskamm -- $0, $0, $0; Jane Aggers -- $15,510, $15,510, $17,448; John Hermsen -- $12,925, $0, $0; Samuel R. Gaston -- $14,100, $0, $0; John Stec -- $0, $0, $0. Mr. Rosskamm's participation under the 1979 Plan has been terminated and has been replaced with a Split Dollar Life Insurance arrangement with a trust established by Alan Rosskamm, pursuant to which the Company and that trust will share in the premium costs of whole life insurance policies that pay death benefits of not less than $10 million upon the death of Alan or Barbara Rosskamm (whichever occurs later). The split-dollar insurance arrangement is structured such that all premium payments are returned to the Company. The present value of Mr. Rosskamm's insurance arrangement for fiscal year 1997 is $84,634. Such compensation includes a $200,000 relocation allowance given to Mr. Gaston during fiscal 1997 and a $60,000 relocation allowance given to Mr. Hermsen during fiscal 1996. 10 13 OPTION GRANTS TABLE OPTION GRANTS IN LAST FISCAL YEAR The following table provides information relating to stock option grants during the last fiscal year for the Chief Executive Officer and the other four most highly compensated executives of the Company.
POTENTIAL REALIZABLE VALUE AT ASSUMED ANNUAL RATES OF STOCK PRICE APPRECIATION INDIVIDUAL GRANTS FOR OPTION TERM (4) - ---------------------------------------------------------------------------------- ------------------------- NUMBER OF SECURITIES PERCENT UNDERLYING OF TOTAL EXERCISE OPTIONS OPTIONS OR BASE GRANTED GRANTED TO PRICE PER (COMMON EMPLOYEES IN COMMON EXPIRATION NAME SHARES) (1) FISCAL YEAR SHARE DATE (3) 5% 10% - ----------------- -------------- ------------ --------- ----------- ---------- ---------- Alan Rosskamm Class B 35,000(2) 8.2% $ 15.00 12/13/2006 $ 330,170 $ 836,715 Jane Aggers Class B 25,000(2) 5.9% $ 15.00 12/13/2006 $ 235,835 $ 597,653 John Hermsen Class B 25,000(2) 5.9% $ 15.00 12/13/2006 $ 235,835 $ 597,653 Samuel R. Gaston Class A 50,000(2) 11.7% $ 14.25 08/22/2006 $ 448,087 $1,135,542 Class B 50,000(2) 11.7% $ 13.88 08/22/2006 $ 436,296 $1,105,659 Class B 15,000(2) 3.5% $ 15.31 01/03/2007 $ 144,454 $ 366,075 John Stec Class B 7,500(2) 1.8% $ 15.00 12/13/2006 $ 70,751 $ 179,296
- --------------- (1) The option holder has the right to pay the exercise price by delivering previously acquired shares of the Company's Common Stock and to have shares withheld to satisfy tax withholding requirements in connection with the exercise of options. Such options become immediately exercisable upon a Change in Control of the Company, as defined in the option plan. Options are nontransferable other than by will or the laws of descent and distribution. (2) The options granted to Mr. Rosskamm, Ms. Aggers, Mr. Hermsen, and Mr. Stec become exercisable in four equal annual installments commencing December 13, 1997. The options to acquire 50,000 Class A and 50,000 Class B Common Shares granted to Mr. Gaston become exercisable in four equal annual installments commencing August 21, 1997 and the options to acquire 15,000 Class B Common Shares become exercisable in four equal installments commencing January 2, 1998. (3) Options were granted for a term of ten years, subject to earlier termination in certain events related to termination of employment. (4) The amounts under the columns labeled "5%" and "10%" are included by the Company pursuant to certain rules promulgated by the Securities and Exchange Commission and are not intended to forecast future appreciation, if any, in the price of Class A or Class B Common Shares. Such amounts are based on the assumption that the named persons hold the options granted for their full ten year term and that the market value of the shares appreciate in value from the market value on the date of grant at the 5% and 10% annualized rates. 11 14 OPTION EXERCISES AND YEAR-END VALUE TABLE AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES The following table provides information relating to aggregate option exercises during the last fiscal year and fiscal year-end option values for the Chief Executive Officer and the other four most highly compensated executive officers of the Company.
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED UNEXERCISED IN-THE MONEY OPTIONS AT OPTIONS AT COMMON FEBRUARY 1, 1997 FEBRUARY 1, 1997 SHARES ACQUIRED VALUE ----------------------------- ----------------------------- NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE - ------------------- --------------- -------- ----------- ------------- ----------- ------------- Alan Rosskamm Class A 7,500 $63,889 164,750 11,250 $1,616,472 $ 89,531 Class B 7,500 $59,201 177,250 83,750 $1,507,472 $ 209,531 Jane Aggers Class A 2,250 $19,167 79,750 14,000 $ 627,193 $ 117,563 Class B 2,250 $17,760 89,750 69,000 $ 597,443 $ 208,563 John Hermsen Class A 0 $ 0 12,500 37,500 $ 27,338 $ 82,013 Class B 0 $ 0 12,500 62,500 $ 14,838 $ 44,513 Samuel R. Gaston Class A 0 $ 0 0 50,000 $ 0 $ 87,500 Class B 0 $ 0 0 65,000 $ 0 $ 56,250 John Stec Class A 4,875 $39,311 24,750 3,750 $ 183,107 $ 29,844 Class B 4,875 $35,655 27,250 18,750 $ 171,107 $ 52,344
CHANGE OF CONTROL AND EMPLOYMENT AGREEMENTS The Company has entered into separate agreements (collectively, the "Agreements") with Alan Rosskamm, John Hermsen, Samuel R. Gaston and Jane Aggers. The Agreements are designed to retain the executives and provide for continuity of management in the event of any actual or threatened change in the control of the Company. Each agreement only becomes operative upon a "Change in Control" of the Company (as defined in the Agreements) and only if the executive is then in the employ of the Company. After a Change in Control, each Agreement becomes, in effect, a two-year employment agreement, providing a salary, bonus and other employee benefits at not less than the levels existing prior to the Change in Control. If the executive is terminated by the Company without "cause" as defined in the Agreement or terminates his or her employment following a significant change in his or her duties, the employee will be entitled to receive compensation and benefits for the balance of the two-year period. The executive is obligated to endeavor to mitigate damages by seeking comparable employment elsewhere and, to the extent the employee receives compensation and benefits from another employer, the foregoing payments and benefits provided by the Company will be reduced accordingly. In each Agreement, the executive agrees that the employee will forfeit the foregoing payments and benefits if the employee engages in competition with the Company during the period that any payments are made or benefits provided under the Agreement. REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION The Compensation Committee of the Board of Directors ("Committee") establishes levels of compensation for the Chief Executive Officer and the other four most highly compensated executive officers, as well as the Company's other officers. The Committee also makes recommendations to the Board of Directors with respect to the adoption and amendment of incentive compensation plans and administers those plans approved by the Board of Directors. The Committee is composed of four non-employee Directors and is accountable to the Board of Directors on all compensation matters regarding executive officers. The overall strategy of the Committee is to design and implement compensation programs that will lead to increases in the Company's return on shareholders' equity over the long-term. 12 15 The Committee's strategy is to design a compensation program that will enable the Company to attract, motivate, and retain key executives and to establish and maintain a performance and achievement-oriented environment. The principal elements of this strategy, in addition to competitive salaries, includes an annual bonus program that is based on operating profit before taxes and long-term equity incentives whose value is dependent on the market price of the Company's Common Stock. These elements are designed to operate on an integrated basis that enhances the Company's long-term business objectives. They are described separately in more detail below. Salary The Compensation Committee strives to provide a competitive total compensation package that helps to attract and retain the best people in the industry. Salaries are generally set above the average of the salaries of comparable officers at companies that are considered comparable. Salary information about comparable companies is determined by direct reference to public disclosures made by selected, publicly-held companies in the specialty retail industry as well as companies in the fabric and craft industries, with consideration given to the relative sales volume of such companies. These companies include many of the companies in the S&P Retail (Specialty-Apparel) Index reflected in the performance graph set forth below. In addition, the Compensation Committee from time to time obtains additional information about industry salary levels from a nationally recognized employment consultant who has significant experience in the retail industry. In general, base salary and other components of compensation are tiered by job responsibility, with the Chief Executive Officer and the three Executive Vice Presidents occupying the top tier. During the 1997 fiscal year, the Compensation Committee increased the average base salaries during the annual performance reviews of the top tier by 3.33%. Bonus The Compensation Committee places strong emphasis on annual incentive compensation as a means for building shareholder value over the long term through consistent annual progress toward improvement in operating profits. The Company's Key Management Incentive Plan provides a vehicle for the payment of significant cash bonuses if predetermined levels of operating profit before taxes are achieved during the year. This operating profit goal is established at a level which exceeds the Company's prior year's operating profit. Bonuses are not payable under this Plan to the individuals in the top tier unless the minimum operating profit target is achieved. During the fiscal year ended February 1, 1997, the Company's operating profit exceeded the minimum goal. The amount payable under this Plan is scaled up to a specified maximum for superior profit performance. In addition to the corporate operating profit goal, the specific award payable to an executive officer is adjusted based on the degree by which he or she also meets individual performance goals suitable for the particular position, which are also determined annually in advance by the Compensation Committee in the case of the Chief Executive Officer, and in all other cases by the Chief Executive Officer or the supervising executive officer. The Key Management Incentive Plan is administered in such a way as to focus the efforts of participants on meeting the expectations of customers and shareholders through teamwork. The Plan's foundation on overall operating profits is intended to provide a common objective that all participants share, thereby linking their interests with those of the Company's shareholders. The amounts available for award under this Plan are determined annually. In general, the award potential for the Chief Executive Officer and the next three most highly compensated executive officers is designed to provide a minimum bonus, if any bonus is payable for the year, of 25 percent of the individual's base salary and a maximum bonus of 75 percent. Bonuses for other executive officers are designed to amount to a smaller percentage of salary. 13 16 Stock Options and Restricted Stock The Compensation Committee also selects the recipients and determines the level of awards of stock options and restricted stock. The option program includes approximately 750 participants, including not only officers but all levels of the Company's management through the level of store managers. This broad participation in the stock option program reflects the Compensation Committee's strong belief that by providing additional incentives to key employees who have substantial responsibility for the management and growth of the Company, the best interests of the shareholders and management will be closely aligned. The number of shares of Common Stock covered by each award is scaled by the Compensation Committee in its discretion according to compensation level and job classification. In exercising this discretion, the Committee took into consideration the overall number of shares of Common Stock available for grant, the number of options outstanding, the number of shares exercisable, and the option price in comparison to the market price for the underlying stock. Options granted to the Chief Executive Officer during the 1997 fiscal year represented 8 percent of all option grants during the year, and grants to the other four most highly compensated executive officers of the Company amounted to approximately 41 percent in the aggregate. Options granted during the 1997 fiscal year vest at the rate of 25 percent per year and expire ten years after the date of the grant. The vesting schedule and expiration term reflect the Compensation Committee's determination that options are designed to have a long-term retention effect and that benefits are realizable over a period of up to ten years. The Compensation Committee also awards restricted stock as a compensation vehicle and to attract and retain key executive managers. Generally, awards are made upon hire or promotion or to recognize superior performance. Currently, eighteen participants hold an award. All awards of restricted stock made during the last three fiscal years have provided for vesting at the end of a period not less than four years and not more than five years after the date of the award. Since the recipient of such an award would forfeit all of the shares of Common Stock if he or she were to leave the Company before the end of the vesting period, the Compensation Committee believes that these awards are a significant factor in the retention of key management personnel and induce a long-term view among key executive officers. Restricted stock is also considered a useful compensation vehicle because, even after it becomes nonforfeitable, it tends to reinforce the recipient's commitment to continued growth of the Company and appreciation in the market price of its Common Stock over the long-term. Effective January 1, 1994, the Omnibus Budget Reconciliation Act of 1993 added Section 162(m) to the Internal Revenue Code. Section 162(m) generally provides that certain compensation in excess of $1 million per year paid to a company's chief executive officer and any of its four other highest paid executive officers is no longer deductible to a company beginning in the 1994 tax year unless the compensation qualifies for an exception. The Committee recognizes that a portion of the compensation to be paid to its executive officers in future years may exceed $1 million and therefore, will not be deductible, however the Committee believes that the benefits of securing the services of these executive officers outweigh the Company's inability to obtain a tax deduction for any such compensation. 14 17 DISCUSSION OF FISCAL 1997 COMPENSATION FOR THE CHAIRMAN AND CHIEF EXECUTIVE OFFICER In considering the compensation for the Chairman and Chief Executive Officer for fiscal 1997, the Committee reviewed his existing compensation arrangements and both the Company's and individual's performance during fiscal 1996. The Committee's decisions took into consideration the fact that financial performance for the year ended January 27, 1996 (fiscal 1996) significantly improved. The Committee accordingly made the following determinations regarding Mr. Rosskamm's compensation for the year ended February 1, 1997 (fiscal 1997): - Effective March 1, 1996, Mr. Rosskamm's base salary was increased by 4% from $400,000 to $416,000 based on the Committee's positive assessment of his performance and contributions during fiscal 1996 as Chairman of the Board, President and Chief Executive Officer. The average salary increase for all individuals in the senior management group was 6%. - Based on the financial performance of the Company for fiscal 1997, the Committee approved an annual incentive compensation award of $310,846. This represents 75% of Mr. Rosskamm's salary, which represents the maximum payment under the Key Management Incentive Plan, because the Company's operating profit of approximately $39,400,000 exceeded the goal for fiscal year 1997 under the plan, which was established prior to the start of fiscal 1997. - The Committee awarded Mr. Rosskamm stock options for 35,000 Class B Common Shares. This represented approximately 8% of the total number of shares awarded to all employees during fiscal 1997. - As part of his overall compensation package Mr. Rosskamm is provided a split dollar life insurance arrangement for Mr. Rosskamm and his wife, which replaced the Supplemental Retirement Plan provided by the Company to Mr. Rosskamm in fiscal 1995. The foregoing report on fiscal year 1997 executive compensation was submitted by the Compensation Committee and shall not be deemed to be "soliciting material" or to be "filed" with the Securities and Exchange Commission or subject to Regulation 14A promulgated by the Securities and Exchange Commission or Section 18 of the Exchange Act. The names of the Directors who serve on the Compensation Committee are set forth below: COMPENSATION COMMITTEE SAMUEL KRASNEY (Chairman) SCOTT COWEN FRANK NEWMAN GREGG SEARLE 15 18 PERFORMANCE Set forth below is a line graph comparing the yearly GRAPH percentage change in the cumulative shareholder return, which includes the reinvestment of cash dividends (if applicable), of the Company's Class A Common Shares and Class B Common Shares with the cumulative total return of the S&P Composite -- 500 Stock Index and the S&P Retail (Specialty-Apparel) Index for the Company as of January 31, 1997 (the date nearest the end of the Company's fiscal year for which index data is readily available) for each of the Company's last five years. The Company changed from the S&P Retail (Specialty) Index to the S&P Retail (Specialty-Apparel) Index this year because the entities comprising the S&P Retail (Specialty-Apparel) Index better reflect the Company's industry. Both the S&P Retail (Specialty-Apparel) Index and S&P Retail (Specialty) Index are presented below. COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN [GRAPHIC]
S&P RETAIL FCA CLASS A FCA CLASS B S&P COM- (SPECIALTY- S&P RETAIL MEASUREMENT PERIOD COMMON COMMON POSITE - 500 APPAREL) (SPECIALTY) (FISCAL YEAR COVERED) SHARES SHARES INDEX INDEX INDEX 1992 100 100 100 100 100 1993 40 40 111 88 115 1994 43 43 125 75 110 1995 40 40 125 60 89 1996 66 60 174 71 69 1997 78 73 220 90 82
* ASSUMES $100 INVESTED ON JANUARY 31, 1992 IN EACH OF THE COMPANY'S CLASS A COMMON SHARES AND CLASS B COMMON SHARES, S&P COMPOSITE -- 500 STOCK INDEX, S&P RETAIL (SPECIALTY-APPAREL) INDEX AND S&P RETAIL (SPECIALTY) INDEX AND THAT ALL DIVIDENDS (IF APPLICABLE) WERE REINVESTED. 19 INDEPENDENT Arthur Andersen LLP have been appointed as the Company's AUDITORS independent auditors for the fiscal year ending January 31, 1998. A representative of Arthur Andersen LLP is expected to be present at the Annual Meeting with an opportunity to make a statement if he desires to do so and to answer appropriate questions with respect to that firm's examination of the Company's financial statements and records for the fiscal year ended February 1, 1997. PROXY The Company will bear the expense of preparing, printing and SOLICITATION mailing this Proxy Statement. In addition to solicitation by mail, officers and regular employees of the Company may solicit by telephone the return of Proxies. The Company will request brokers, banks and other custodians, nominees and fiduciaries to send Proxy material to beneficial owners and will, upon request, reimburse them for their expense. SHAREHOLDERS' The deadline for shareholders to submit proposals to be PROPOSALS considered for inclusion in the Proxy Statement for the 1998 Annual Meeting of Shareholders is expected to be January 31, 1998. ANNUAL The Company's Annual Report for the fiscal year ended February REPORT 1, 1997, including financial statements of the Company and the report thereon of Arthur Andersen LLP, is being mailed to holders of Class A Common Shares with this Notice of Annual Meeting and Proxy Statement. BETTY ROSSKAMM, Secretary By order of the Board of Directors May 2, 1997 20 FABRI-CENTERS OF AMERICA, INC. BOARD OF DIRECTORS PROXY P ANNUAL MEETING, JUNE 5, 1997 R O X At the Annual Meeting of Shareholders of the Company to be held Y on June 5, 1997, and at any adjournment, Betty Rosskamm, Alma Zimmerman, and Ira Gumberg, or any one of them, is hereby authorized to represent me and thereat to vote my shares on the following: 1. Election of Directors. The nominees of the Board of Directors to (change of address) the class whose term of office will expire in 2000 are: -------------------------------------- Alan Rosskamm, Scott Cowen, and Gregg Searle -------------------------------------- -------------------------------------- -------------------------------------- (If you have written in the above space, please mark the corresponding box on the reverse side of this card.) PLEASE DATE AND SIGN EXACTLY AS THE NAMES APPEAR ON THE FACE OF THE PROXY AND RETURN BY MAIL PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE. SHARES REPRESENTED BY PROPERLY EXECUTED PROXIES WILL BE VOTED AS SPECIFIED. UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE. SEE REVERSE SIDE - -------------------------------------------------------------------------------- Please sign and detach card above and place in envelope provided.
21 [X] PLEASE MARK YOUR SHARES IN YOUR NAME VOTES AS IN THIS EXAMPLE. 1. Election of FOR WITHHELD Directors (see reverse) [ ] [ ] (INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), write the name(s) of the nomi- nee(s) in the space provided below.) _______________________________________________________ Change of [ ] Address Attend [ ] Meeting SIGNATURE(S) ___________________________________________ DATE __________________ SIGNATURE(S) ___________________________________________ DATE __________________ Please give title when signing as executor, administrator, trustee, attorney or other representative. If shares are registered in the names of joint tenants or trustees, each joint tenant or trustee should sign. - ------------------------------------------------------------------------------------------------------------------------------------ Please sign and detach card above and place in envelope provided.
22 CONFIDENTIAL VOTING INSTRUCTIONS TO: KEYCORP, TRUSTEE UNDER THE FABRI-CENTERS OF AMERICA, INC. EMPLOYEES' SAVINGS AND PROFIT-SHARING PLAN Pursuant to the provisions of the Fabri-Centers of America, Inc. Employees' Savings and Profit-Sharing Plan, the undersigned, as a participant in or beneficiary of the Plan, having received the Notice and accompanying Proxy Statement for the Annual Meeting of Shareholders of the Company to be held on June 5, 1997, hereby directs the Trustee to vote (in person or by proxy) shares of Common Stock of the Company credited to the undersigned's account under the Plan on the record date for the Meeting, and at any adjournment thereof, on the following:
1. Election of Directors. The nominees of the Board of Directors to the class whose term of office will expire in 2000 are: (change of address) Alan Rosskamm, Scott Cowen, and Gregg Searle -------------------------------------------- -------------------------------------------- -------------------------------------------- -------------------------------------------- (If you have written in the above space, please mark the corresponding box on the reserve side of this card.)
PLEASE SIGN AND DATE EXACTLY AS THE NAME APPEARS ABOVE AND RETURN BY MAIL PROMPTLY IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE. SHARES REPRESENTED BY PROPERLY EXECUTED PROXIES WILL BE VOTED AS SPECIFIED. UNLESS OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE. SEE REVERSE SIDE - -------------------------------------------------------------------------------- Please sign and detach card above and place in envelope provided. 23 [X] PLEASE MARK YOUR SHARES IN YOUR NAME VOTES AS IN THIS EXAMPLE. 1. Election of FOR WITHHELD Directors (see reverse) [ ] [ ] (INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), write the name(s) of the nomi- nee(s) in the space provided below.) _______________________________________________________ Change of [ ] Address Attend [ ] Meeting SIGNATURE(S) ___________________________________________ DATE __________________ These confidential voting instructions will be seen only by authorized personnel of the Trustee. - ------------------------------------------------------------------------------------------------------------------------------------ Please sign and detach card above and place in envelope provided.
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