-----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, E1Aep+KrSe+sPoV4qr5bHuJ036WJucdwD2Qupn46UZ97MG6PDM+A71oLwtrIOKsJ huqynZ27eA16iDBraRzy5w== 0000950129-98-005222.txt : 19981231 0000950129-98-005222.hdr.sgml : 19981231 ACCESSION NUMBER: 0000950129-98-005222 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981118 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19981230 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MENS WEARHOUSE INC CENTRAL INDEX KEY: 0000884217 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-APPAREL & ACCESSORY STORES [5600] IRS NUMBER: 741790172 STATE OF INCORPORATION: TX FISCAL YEAR END: 0201 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 000-20036 FILM NUMBER: 98778743 BUSINESS ADDRESS: STREET 1: 5803 GLENMONT DR CITY: HOUSTON STATE: TX ZIP: 77081 BUSINESS PHONE: 7132957200 MAIL ADDRESS: STREET 1: 5083 GLENMONT DR CITY: HOUSTON STATE: TX ZIP: 77081 8-K 1 THE MEN'S WEARHOUSE, INC. - DATED 11/18/98 1 =============================================================================== SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (Date of earliest event reported): NOVEMBER 18, 1998 THE MEN'S WEARHOUSE, INC. (Exact name of registrant as specified in charter)
TEXAS 000-20036 74-1790172 (State of Incorporation) (Commission File No.) (I.R.S. Employer Identification No.)
5803 GLENMONT DRIVE HOUSTON, TEXAS 77081 (Address of Principal Executive Offices) (Zip Code) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (713) 592-7200 =============================================================================== Page 1 2 ITEM 5. OTHER EVENTS. On November 18, 1998, The Men's Wearhouse, Inc., a Texas corporation (the "Company"), entered into a Combination Agreement (the "Combination Agreement") with Golden Moores Company, a Nova Scotia, Canada unlimited liability company and a wholly owned subsidiary of the Company ("Canco"), Moores Retail Group Inc., a New Brunswick, Canada corporation ("Moores"), and the shareholders of Moores signatory thereto (collectively, the "Shareholders"). Under the terms of the Combination Agreement, Moores will be merged with Canco, and the Shareholders and employees of Moores who hold certain options to purchase a class of Moores capital stock (collectively, the "Optionholders") will receive, based on certain adjustments, between 2.50 and 2.75 million shares of the Company's common stock, par value $0.01 per share (the "Company Common Stock"), in exchange for all of the outstanding capital stock of Moores. Pursuant to the Combination Agreement, Moores will be restructured so that Canco will own the only outstanding common stock of Moores. The Shareholders and Optionholders will exchange their shares of capital stock of Moores and their options for a new class of exchangeable shares (the "Exchangeable Shares") of Moores. Except to the extent required by the laws of the Province of New Brunswick, the only rights of the Exchangeable Shares will be to permit the holders thereof to exchange each Exchangeable Share for a share of the Company Common Stock and to receive dividends on the Exchangeable Shares in an amount equal to dividends, if any, paid on the Company Common Stock. Each Exchangeable Share will also have the right, under the terms of one share of special voting preferred stock to be issued by the Company, to cast a vote equivalent to the vote of one share of the Company Common Stock on each matter submitted to the holders of the Company Common Stock for a vote. In connection with the closing of this transaction, Moores' existing indebtedness of approximately $90 million (Canadian dollars) must be repaid. The Company has the resources under its existing credit facility to borrow sufficient funds to loan to Moores to allow Moores to repay this debt. However, the Company may also enter into an additional credit facility to fund the repayment of Moores' debt. The combination is subject to various conditions, including the receipt of all required regulatory approvals. Although there can be no assurance that the combination will close, the Company currently anticipates that the acquisition will be consummated shortly after the receipt of such regulatory approvals and the satisfaction of the remaining conditions set forth in the Combination Agreement. The description of the terms and provisions of the Combination Agreement in this report are qualified in their entirety by reference to the Combination Agreement that is incorporated by reference from Exhibit 2.1 to the Company's Registration Statement on Form S-3 filed with the Securities and Exchange Commission on December 30, 1998 and is hereby incorporated herein by reference. A copy of the press release announcing the signing of the Combination Agreement is filed as Exhibit 99.1 and is hereby incorporated herein by reference. Page 2 3 ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS (b) Pro Forma Financial Information. The following pro forma financial information is included in Appendix A hereto and filed herewith: Pro Forma Combined Financial Statements - Basis of Presentation Pro Forma Combined Balance Sheet at October 31, 1998 Pro Forma Combined Statements of Net Earnings: For the Year Ended January 31, 1998 For the Nine Months Ended October 31, 1998 For the Nine Months Ended November 1, 1997 Notes to Pro Forma Combined Financial Statements (c) Exhibits. 2.1 - Combination Agreement dated November 18, 1998, by and between The Men's Wearhouse, Inc., Golden Moores Company, Moores Retail Group Inc. and the Shareholders of Moores Retail Group signatory thereto (incorporated by reference from Exhibit 2.1 to the Company's Registration Statement on Form S-3 filed with the Securities and Exchange Commission on December 30, 1998). 4.1 - Registration Rights Agreement dated as of November 18, 1998, by and among The Men's Wearhouse, Inc. and Marpro Holdings, Inc., MGB Limited Partnership, Capital D'Amerique CDPQ Inc., Cerberus International, Ltd., Ultra Cerberus Fund, Ltd., Styx International Ltd., The Long Horizons Overseas Fund Ltd., The Long Horizons Fund, L.P. and Styx Partners, L.P. (incorporated by reference from Exhibit 4.13 to the Company's Registration Statement on Form S-3 filed with the Securities and Exchange Commission on December 30, 1998). 99.1 - Press Release of the Company dated November 18, 1998, announcing the signing of the Combination Agreement. Page 3 4 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. THE MEN'S WEARHOUSE, INC. Dated: December 30, 1998 /s/ GARY CKODRE ----------------------------------------- Gary Ckodre Vice President - Finance Page 4 5 APPENDIX A THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES PRO FORMA COMBINED FINANCIAL STATEMENTS A-1 6 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES PRO FORMA COMBINED FINANCIAL STATEMENTS BASIS OF PRESENTATION (UNAUDITED, IN THOUSANDS) The unaudited pro forma combined financial statements give effect to the proposed combination of The Men's Wearhouse, Inc. (Men's Wearhouse) and Moores Retail Group Inc. (Moores) under the pooling of interests method of accounting. The unaudited pro forma combined financial statements should be read in conjunction with the historical consolidated financial statements and the notes thereto of Men's Wearhouse and of Moores. The unaudited pro forma combined balance sheet assumes that the proposed combination was consummated on October 31, 1998 and combines the Men's Wearhouse and Moores October 31, 1998 consolidated balance sheets. The unaudited pro forma combined balance sheet includes adjustments which give effect to events that are directly attributable to the transaction. The unaudited pro forma combined statements of earnings for the nine months ended October 31, 1998 and November 1, 1997 and for the year ended January 31, 1998 assume that the proposed combination was consummated on February 2, 1997 and have been prepared by combining the historical results of Men's Wearhouse and Moores for such periods. Moores commenced operations on December 23, 1996 and reported a net loss of U.S. $96 for the 40 day period from December 23, 1996 to January 31, 1997. No pro forma combined statements of earnings have been presented for years prior to fiscal 1997 because the effect of the proposed combination on such statements is not significant. Nonrecurring charges totaling $4,927, net of a $219 tax benefit, which result directly from the transaction and which are expected to be included in the results of operations of Men's Wearhouse within the twelve months succeeding the transaction have been excluded from the unaudited pro forma combined statements of earnings. In addition, an extraordinary charge of approximately $3,058, net of a $1,534 tax benefit, relating to refinancing certain Moores debt has not been reflected. The effect of these nonrecurring and extraordinary charges have, however, been reflected in the pro forma adjustments to retained earnings in the pro forma combined balance sheet. The historical consolidated financial statements of Moores included in the pro forma combined balance sheets and statements of earnings are stated in United States dollars and have been prepared in accordance with generally accepted accounting principles in the United States. The exchange rates used in translating the historical Canadian currency financial statements of Moores reflect the current exchange rate as of the balance sheet date and the weighted average exchange rates for the periods presented in the statements of earnings. The cumulative translation adjustments are reported as a separate component of shareholders' equity. The historical statements of earnings for Moores included in the pro forma combined statements of earnings do not reflect earnings per share data since Moores, as a privately owned company, has not reported such data. All share and per share data reflected in the historical Men's Wearhouse statements of earnings have been adjusted to give effect to a 50% stock dividend effected on June 2, 1998. The preparation of unaudited pro forma combined financial statements requires management to make estimates and assumptions based on information currently available. The pro forma adjustments made in connection with the development of the pro forma information are preliminary and have been made solely for purposes of developing such pro forma information for illustrative purposes necessary to comply with the disclosure requirements of the Securities and Exchange Commission. The unaudited pro forma combined financial statements do not purport to be indicative of the results of operations for future periods or the combined financial positions or the results that actually would have been realized had the entities been a single entity during the periods presented. Under the terms of the proposed combination, Men's Wearhouse will be required to issue 2,500,000 shares of its common stock to the existing shareholders and optionholders of Moores. However, depending on the market price of Men's Wearhouse common stock for a specified period prior to closing, the number of shares to be issued may increase to a maximum of 2,750,000. A-2 7 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES PRO FORMA COMBINED BALANCE SHEET OCTOBER 31, 1998 (UNAUDITED -- IN THOUSANDS)
AS REPORTED ------------------------------- ADJUSTMENTS ADJUSTED MEN'S PRO FORMA PRO FORMA FOR PRO FORMA WEARHOUSE MOORES TOTAL ADJUSTMENTS COMBINED REFINANCING COMBINED --------- -------- -------- ----------- --------- ----------- ------------ (U.S. $) ASSETS CURRENT ASSETS: Cash........................ $ 5,910 $ 1,696 $ 7,606 $ $ 7,606 $ $ 7,606 Inventories................. 275,215 38,482 313,697 313,697 313,697 Other current assets........ 13,596 3,057 16,653 16,653 (2) 511 17,164 -------- ------- -------- ------- -------- -------- -------- Total current assets.............. 294,721 43,235 337,956 337,956 511 338,467 PROPERTY AND EQUIPMENT, NET... 96,434 10,430 106,864 106,864 106,864 OTHER ASSETS, NET............. 24,683 25,109 49,792 (1) (246) 49,546 (2) (2,941) 46,605 -------- ------- -------- ------- -------- -------- -------- TOTAL................. $415,838 $78,774 $494,612 $ (246) $494,366 $ (2,430) $491,936 ======== ======= ======== ======= ======== ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Revolving debt.............. $ $10,521 $ 10,521 $ $ 10,521 (2) $(10,521) $ Current portion of long-term debt...................... 3,403 3,403 3,403 (2) (3,403) Accounts payable and accrued expenses.................. 96,054 14,123 110,177 (1) (314) 109,863 109,863 Income taxes payable........ 837 660 1,497 (1) (219) 1,278 1,278 -------- ------- -------- ------- -------- -------- -------- Total current liabilities......... 96,891 28,707 125,598 (533) 125,065 (13,924) 111,141 LONG-TERM DEBT................ 32,750 44,672 77,422 (1) 3,912 81,334 (2) 15,575 96,909 OTHER LIABILITIES............. 7,089 264 7,353 7,353 (2) (1,023) 6,330 -------- ------- -------- ------- -------- -------- -------- Total liabilities..... 136,730 73,643 210,373 3,379 213,752 628 214,380 -------- ------- -------- ------- -------- -------- -------- COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Preferred stock............. Common stock................ 348 1,708 2,056 (3) (1,683) 373 373 Capital in excess of par.... 148,264 148,264 (1)(3) 2,985 151,249 151,249 Retained earnings........... 131,490 3,786 135,276 (1) (4,927) 130,349 (2) (3,058) 127,291 -------- ------- -------- ------- -------- -------- -------- Total................. 280,102 5,494 285,596 (3,625) 281,971 (3,058) 278,913 Currency translation adjustment................ (363) (363) (363) (363) Treasury stock, at cost..... (994) (994) (994) (994) -------- ------- -------- ------- -------- -------- -------- Total shareholders' equity.............. 279,108 5,131 284,239 (3,625) 280,614 (3,058) 277,556 -------- ------- -------- ------- -------- -------- -------- TOTAL................. $415,838 $78,774 $494,612 $ (246) $494,366 $ (2,430) $491,936 ======== ======= ======== ======= ======== ======== ========
See Notes to Pro Forma Combined Financial Statements. A-3 8 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES PRO FORMA COMBINED STATEMENT OF EARNINGS FOR THE YEAR ENDED JANUARY 31, 1998 (UNAUDITED -- IN THOUSANDS, EXCEPT PER SHARE DATA)
AS REPORTED ------------------------------- MEN'S PRO FORMA PRO FORMA WEARHOUSE MOORES TOTAL ADJUSTMENTS COMBINED --------- -------- -------- ----------- --------- (U.S. $) Net sales................................. $631,110 $131,414 $762,524 $762,524 Cost of goods sold, including buying and occupancy costs......................... 388,517 82,751 471,268 471,268 -------- -------- -------- ---------- -------- Gross margin.............................. 242,593 48,663 291,256 291,256 Selling, general and administrative expenses................................ 191,063 35,296 226,359 226,359 -------- -------- -------- ---------- -------- Operating income.......................... 51,530 13,367 64,897 64,897 Interest expense, net..................... 2,366 7,234 9,600 9,600 -------- -------- -------- ---------- -------- Earnings before income taxes.............. 49,164 6,133 55,297 55,297 Provision for income taxes................ 20,281 4,065 24,346 24,346 -------- -------- -------- ---------- -------- Net earnings.............................. $ 28,883 $ 2,068 $ 30,951 $ 30,951 ======== ======== ======== ========== ======== Assuming issuance of 2,500 shares: - ------------------------------------------ Net earnings per share -- Basic................................... $ 0.89 $ 0.89 $ 0.89 ======== ======== ======== Diluted................................. $ 0.87 $ 0.87 $ 0.87 ======== ======== ======== Weighted average shares outstanding -- Basic................................... 32,345 32,345 (4) 2,500 34,845 ======== ======== ========== ======== Diluted................................. 35,384 35,384 (4) 2,500 37,884 ======== ======== ========== ======== Assuming issuance of 2,750 shares: - ------------------------------------------ Net earnings per share -- Basic................................... $ 0.89 $ 0.89 $ 0.88 ======== ======== ======== Diluted................................. $ 0.87 $ 0.87 $ 0.86 ======== ======== ======== Weighted average shares outstanding -- Basic................................... 32,345 32,345 (4) 2,750 35,095 ======== ======== ========== ======== Diluted................................. 35,384 35,384 (4) 2,750 38,134 ======== ======== ========== ========
See Notes to Pro Forma Combined Financial Statements. A-4 9 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES PRO FORMA COMBINED STATEMENT OF EARNINGS FOR THE NINE MONTHS ENDED OCTOBER 31, 1998 (UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE DATA)
AS REPORTED ------------------------------- MEN'S PRO FORMA PRO FORMA WEARHOUSE MOORES TOTAL ADJUSTMENTS COMBINED --------- -------- -------- ----------- --------- (U.S. $) Net sales................................. $504,450 $ 94,682 $599,132 $599,132 Cost of goods sold, including buying and occupancy costs......................... 311,432 59,002 370,434 370,434 -------- -------- -------- ---------- -------- Gross margin.............................. 193,018 35,680 228,698 228,698 Selling, general and administrative expenses................................ 153,910 25,863 179,773 179,773 -------- -------- -------- ---------- -------- Operating income.......................... 39,108 9,817 48,925 48,925 Interest expense, net..................... 1,674 5,310 6,984 6,984 -------- -------- -------- ---------- -------- Earnings before income taxes.............. 37,434 4,507 41,941 41,941 Provision for income taxes................ 15,442 2,693 18,135 18,135 -------- -------- -------- ---------- -------- Net earnings before extraordinary item.... $ 21,992 $ 1,814 $ 23,806 $ 23,806 ======== ======== ======== ========== ======== Assuming issuance of 2,500 shares: - ------------------------------------------ Net earnings before extraordinary item per share -- Basic................................... $ 0.66 $ 0.66 $ 0.66 ======== ======== ======== Diluted................................. $ 0.64 $ 0.64 $ 0.64 ======== ======== ======== Weighted average shares outstanding -- Basic................................... 33,517 33,517 (4) 2,500 36,017 ======== ======== ========== ======== Diluted................................. 36,261 36,261 (4) 2,500 38,761 ======== ======== ========== ======== Assuming issuance of 2,750 shares: - ------------------------------------------ Net earnings before extraordinary item per share -- Basic................................... $ 0.66 $ 0.66 $ 0.66 ======== ======== ======== Diluted................................. $ 0.64 $ 0.64 $ 0.64 ======== ======== ======== Weighted average shares outstanding -- Basic................................... 33,517 33,517 (4) 2,750 36,267 ======== ======== ========== ======== Diluted................................. 36,261 36,261 (4) 2,750 39,011 ======== ======== ========== ========
See Notes to Pro Forma Combined Financial Statements. A-5 10 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES PRO FORMA COMBINED STATEMENT OF EARNINGS FOR THE NINE MONTHS ENDED NOVEMBER 1, 1997 (UNAUDITED -- IN THOUSANDS, EXCEPT PER SHARE DATA)
AS REPORTED ------------------------------- MEN'S PRO FORMA PRO FORMA WEARHOUSE MOORES TOTAL ADJUSTMENTS COMBINED --------- -------- -------- ----------- --------- (U.S. $) Net sales.............................. $410,867 $92,402 $503,269 $503,269 Cost of goods sold, including buying and occupancy costs.................. 256,104 58,129 314,233 314,233 -------- ------- -------- ----- -------- Gross margin........................... 154,763 34,273 189,036 189,036 Selling, general and administrative expenses............................. 127,508 24,184 151,692 151,692 -------- ------- -------- ----- -------- Operating income....................... 27,255 10,089 37,344 37,344 Interest expense, net.................. 1,824 5,478 7,302 7,302 -------- ------- -------- ----- -------- Earnings before income taxes........... 25,431 4,611 30,042 30,042 Provision for income taxes............. 10,490 2,550 13,040 13,040 -------- ------- -------- ----- -------- Net earnings........................... $ 14,941 $ 2,061 $ 17,002 $ 17,002 ======== ======= ======== ===== ======== Assuming issuance of 2,500 shares: - --------------------------------------- Net earnings per share -- Basic................................ $ 0.47 $ 0.47 $ 0.49 ======== ======== ======== Diluted.............................. $ 0.47 $ 0.47 $ 0.49 ======== ======== ======== Weighted average shares outstanding -- Basic................................ 32,089 32,089 (4)2,500 34,589 ======== ======== ===== ======== Diluted.............................. 35,123 35,123 (4)2,500 37,623 ======== ======== ===== ======== Assuming issuance of 2,750 shares: - --------------------------------------- Net earnings per share -- Basic................................ $ 0.47 $ 0.47 $ 0.49 ======== ======== ======== Diluted.............................. $ 0.47 $ 0.47 $ 0.49 ======== ======== ======== Weighted average shares outstanding -- Basic................................ 32,089 32,089 (4)2,750 34,839 ======== ======== ===== ======== Diluted.............................. 35,123 35,123 (4)2,750 37,873 ======== ======== ===== ========
See Notes to Pro Forma Combined Financial Statements. A-6 11 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES NOTES TO PRO FORMA COMBINED FINANCIAL STATEMENTS (UNAUDITED, IN THOUSANDS) The pro forma combined financial statements as of October 31, 1998 and for the nine months ended October 31, 1998 and November 1, 1997 and for the year ended January 31, 1998 include the following adjustments to reflect the combination as a pooling of interests and the concurrent debt refinancing: 1. To record the estimated transaction costs to complete the combination of Men's Wearhouse and Moores under pooling of interests accounting. The costs, which primarily relate to investment banking fees, professional fees, contract termination payments and unamortized stock option compensation expenses, are currently estimated to be approximately $4,927, net of a tax benefit of $219, and are reflected as a reduction in retained earnings in the accompanying balance sheet. These costs are not reflected in the pro forma combined statements of earnings. 2. To adjust the pro forma combined balance sheet for the effects of refinancing approximately $60 million of existing Moores debt as of October 31, 1998 as follows: Revolving debt refinanced with long-term debt............... $10,521 Current portion of long-term debt refinanced with long-term debt...................................................... 3,403 Prepayment penalty from early retirement of long-term debt...................................................... 1,651 ------- Addition to long-term debt.................................. $15,575 ======= Write off of Moores historical deferred financing costs, net of tax of $907............................................ $ 2,034 Prepayment penalty from early retirement of long-term debt, net of tax of $627........................................ 1,024 ------- Adjustment to retained earnings............................. $ 3,058 =======
The effects of the refinancing are not reflected in the pro forma combined statements of earnings. 3. To adjust common stock and capital in excess of par value to reflect the issuance of 2,500,000 shares of Men's Wearhouse common stock to Moores shareholders and optionholders. 4. Pro forma basic earnings per share is computed based on the weighted average number of common shares outstanding. Pro forma diluted earnings per share is computed based on the weighted average number of common shares plus the dilutive impact of options and convertible securities for each period after giving effect to the combination on a pooling of interests basis. Pro forma shares and earnings per share data is presented to reflect the issuance of a minimum of 2,500,000 shares and a maximum of 2,750,000 shares of Men's Wearhouse common stock. A-7 12 INDEX TO EXHIBITS Number Exhibit ------ ------- 99.1 Press Release of the Company dated November 18, 1998, announcing the signing of the Combination Agreement. EX-99.1 2 PRESS RELEASE, DATED 11/18/98 1 EXHIBIT 99.1 MEN'S WEARHOUSE SIGNS DEFINITIVE AGREEMENT TO ACQUIRE MOORES RETAIL GROUP OF CANADA FREMONT, Calif. - (BUSINESS WIRE) - November 18, 1998 - Men's Wearhouse, Inc. (NASDAQ National Market System Symbol: SUIT) said today it has executed a Definitive Agreement to acquire Moores Retail Group Inc. (Moores), a privately held retailer which operates 115 men's apparel stores - 107 stores in Canada and 8 stores in the United States and a vertically integrated manufacturing facility in Montreal, Canada. The retail stores are operated under the name, Moores The Suit People. Under the terms of the Agreement, Moores would be merged with a subsidiary of Men's Wearhouse with shareholders of Moores receiving, based on certain adjustments, between 2.50 and 2.75 million shares of Men's Wearhouse common shares for all of the outstanding shares of Moores. In addition, Men's Wearhouse will assume approximately $90 million (Canadian dollars) in debt of Moores, which it expects to refinance. The company intends to account for this transaction as a pooling-of-interest. The proposed merger, which is expected to be completed by the end of Men's Wearhouse current fiscal year, is expected to benefit Men's Wearhouse growth strategies. Moores was founded in 1961 as Golden Brand Clothing and opened its first retail store in 1980. The company currently operates its men's apparel stores in all of Canada's ten provinces including Ontario (46 stores); Quebec (22 stores); British Colombia (13 stores); Alberta (11 stores); Saskatchewan (2 stores); Manitoba (5 stores); New Brunswick (3 stores); Nova Scotia (3 stores); Newfoundland (1 store); Prince Edward Island (one store) and eight stores in the United States in Chicago, Illinois, and Cleveland and Youngstown, Ohio. Moores employs approximately 2,000 individuals, 1,100 and 900 in its retail and manufacturing operations, respectively. For the fiscal year ended January 31, 1998, Moores had sales of approximately $183 million (Canadian dollars) and generated earnings before interest, taxes, depreciation, amortization, and non-recurring costs of $25.7 million (Canadian dollars). Moores' wholly owned subsidiary, Golden Brand Clothing Canada, Ltd. manufactures tailored apparel primarily for Moore's retail operations. According to the Canadian Apparel Market Monitor, Moores is the largest retailer of men's suits and sport coats with approximately 17.6 percent of the retail dollar market share in Canada. Moores retail stores are principally located in strip or power shopping centers which offer merchandise at everyday low prices of approximately 20-30 percent below department stores. Founded in 1973, Men's Wearhouse is one of the largest specialty retailers of men's tailored business attire in the United States. The company currently operates 414 stores in 38 states, including 18 stores in its Value Priced Clothing division. Men's Wearhouse stores carry a full selection of designer, brand name and private label suits, sport coats, furnishings and accessories. The company reported revenues of $631.1 million in fiscal 1997. 2 For more information on Men's Wearhouse, contact the company on the worldwide web at www.menswearhouse.com. This press release contains forward looking information. The forward looking statements are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements include the company's intent to complete the acquisition of Moores Retail Group, Inc., and may be significantly impacted by various factors, including unfavorable local, regional and national economic developments, severe weather conditions, aggressive advertising or marketing activities of competitors and other factors described herein and in the company's annual report Form 10-K filed with the Securities and Exchange Commission for the year ended January 31, 1998 and Form 10-Q for the quarter ended August 1, 1998. - --------------------- Contact: The Men's Wearhouse Neill Davis, 713/592-7200 -----END PRIVACY-ENHANCED MESSAGE-----