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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) December 10, 1998
DESIGNS, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-15898 04-2623104
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
66 B Street
Needham, Massachusetts 02194
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(Address of principal executive offices) (Zip Code)
(781) 444-7222
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS.
On December 10, 1998, the Board of Directors of Designs, Inc., a
Delaware corporation (the "Company"), approved the formation of a committee
of independent outside directors to consider the Company's strategic
alternatives, including a possible sale of the Company, with a view towards
maximizing stockholder value in the near term. The Board of Directors of
the Company also determined to oppose the consent solicitation initiated by
Jewelcor Management, Inc., a Nevada corporation, and its controlling
shareholder, Seymour Holtzman, for the purpose of removing and replacing
the members of the Company's Board of Directors other than Chairman Stanley
I. Berger. A copy of the press release issued by the Company on December
11, 1998 is attached hereto as Exhibit 99.1.
Also on December 10, 1998, the Board of Directors of the Company
approved certain amendments to the By-laws of the Company. The amendments
to the By-laws are attached hereto as Exhibit 99.2 and are incorporated
herein by reference in its entirety.
ITEM 7. FINANCIAL STATEMENT AND EXHIBITS.
The following exhibits are filed with this Current Report on Form 8-K:
Exhibit
Number Description
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99.1 Press Release of Designs, Inc., dated December 11, 1998.
99.2 Text of amendments to the By-laws of Designs, Inc.
SIGNATURE
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 hereunder duly authorized.
Dated: December 11, 1998
DESIGNS, INC.
By: /s/ Carolyn R. Faulkner
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Name: Carolyn R. Faulkner
Title: Vice President, Chief Financial
Officer and Treasurer
EXHIBIT INDEX
Exhibit
Number Description
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99.1 Press Release of Designs, Inc., dated December 11, 1998.
99.2 Text of amendments to the By-laws of Designs, Inc.
Exhibit 99.1
FOR IMMEDIATE RELEASE
For Information, Contact:
Carolyn R. Faulkner, Vice President,
Chief Financial Officer and Treasurer
Designs, Inc.
(781) 444-7222
Shareholder Information Line
1-888-DESI-333
(Needham, MA, December 11, 1998) -- Designs, Inc. (NASDAQ: DESI), operator
of outlet and specialty retail apparel stores, today announced its Board of
Directors has formed a committee of independent outside directors to
consider the Company's strategic alternatives, including a possible sale of
the Company, with a view towards maximizing stockholder value in the near
term. The Company has retained Shields & Company, Inc. in this regard.
The Company said that although it believes its current operating strategy
is sound, the difficult operating environment coupled with the anticipated
time frame for realizing the benefits of its operating strategy are such
that the Board has determined that seeking to maximize value in the near
term is in the best interest of stockholders.
The Company also announced that its Board has determined to oppose the
consent solicitation initiated by Jewelcor Management, Inc. and its
controlling shareholder, Seymour Holtzman. The Company said that a change
in the composition of the Board at this time is not in the best interests
of stockholders because it would interfere with the Company's consideration
of strategic alternatives and the implementation of any such alternatives
and could adversely affect the Company's relationship with Levi Strauss &
Co. The Company also said that the operating strategy articulated by Mr.
Holtzman in his preliminary consent solicitation materials substantially
mirrors the Company's existing strategy, which has already been in place
for some time and which the Company has already made substantial progress
towards implementing.
The discussion of forward-looking information requires management of the
Company to make certain estimates and assumptions regarding the strategic
direction and its effect on the Company's financial results. Actual
results and strategic direction may differ from current estimates and
assumptions. For more information, refer to the Company's prior SEC
filings for a discussion of factors that affect the Company's forward-
looking statements.
Designs, Inc. operates 130 stores in five retail formats. These stores are
located in enclosed regional shopping malls, urban locations and outlet
parks throughout the eastern United States.
* * * * *
Designs, Inc. ("Designs") and certain other persons named below may be
deemed to be participants in the solicitation of consents (the
"Solicitation") in opposition to the consent solicitation by Seymour H.
Holtzman and certain companies controlled by him for the purpose of, among
other things, removing the current members of the Board of Directors of
Designs and electing a new slate of directors. The participants in the
Solicitation may include the following directors of Designs: Stanley I.
Berger, Joel H. Reichman, James G. Groninger, Bernard M. Manuel, Melvin I.
Shapiro and Peter L. Thigpen; the following executive officers of Designs:
Joel H. Reichman, Scott N. Semel and Carolyn R. Faulkner; and the following
officer of Designs: Anthony E. Hubbard, the Company's Vice President and
Deputy General Counsel (collectively, the "Designs Participants"). As of
the date of this communication, Stanley I. Berger, Joel H. Reichman, Scott
N. Semel, Carolyn R. Faulkner, James G. Groninger, Melvin I. Shapiro,
Bernard M. Manuel, Peter L. Thigpen and Anthony E. Hubbard beneficially
owned 1,198,403, 349,121, 267,203, 55,333, 50,901, 63,003, 29,601 and 9,900
shares of Designs common stock, respectively (including shares subject to
stock options exercisable within 60 days).
Designs has retained Shields & Company, Inc. (the "Financial Advisor") to
act as its financial advisor in connection with the Solicitation for which
it may receive substantial fees, as well as reimbursement of reasonable
out-of-pocket expenses. In addition, Designs has agreed to indemnify the
Financial Advisor and certain persons related to it against certain
liabilities arising out of their engagement. The Financial Advisor is an
investment banking and advisory firm that provides a range of financial
services for institutional and individual clients. The Financial Advisor
does not admit that it or any of its directors, officers or employees is a
"participant" as defined in Schedule 14A promulgated under the Securities
Exchange Act of 1934, as amended, in the Solicitation, or that Schedule 14A
requires the disclosure of certain information concerning the Financial
Advisor. In connection with the Financial Advisor's role as financial
advisor to Designs, the Financial Advisor and the following investment
banking employees of the Financial Advisor may communicate in person, by
telephone or otherwise with a limited number of institutions, brokers or
other persons who are stockholders of Designs: Thomas J. Shields and
Jeffrey C. Bloomberg. None of the Financial Advisor, Thomas J. Shields or
Jeffrey C. Bloomberg beneficially own any of Designs' outstanding equity
securities.
Exhibit 99.2
BY-LAW AMENDMENTS ADOPTED 12/10/98
1. The By-laws hereby are amended by adding a new Section 3.15
thereto as follows:
3.15 Inspection of Stockholder Consents. In the event of the
delivery to the Corporation of the requisite written stockholder
consents to take corporate action and/or any related revocation or
revocations, the Corporation shall engage nationally recognized
independent inspectors of elections for the purpose of promptly
performing a ministerial review of the validity of such consents and
revocations. For the purpose of permitting the inspectors to perform
such review, no action by written consent without a meeting shall be
effective until such date as the independent inspectors certify to the
Corporation that the consents delivered to the Corporation constitute
at least the minimum number of votes that would be necessary to take
the corporate action. Nothing contained in this paragraph shall in
any way be construed to suggest or imply that the Board of Directors
or any stockholder shall not be entitled to contest the validity of
any consent or revocation thereof, whether before or after such
certification by the independent inspectors, or to take any other
action (including, without limitation, the commencement, prosecution
or defense of any litigation with respect thereto, and the seeking of
injunctive relief in such litigation).
2. Section 4.8 of the By-laws is hereby deleted in its entirety and
replaced with the following:
4.8 Notice. It shall be reasonable and sufficient notice to a
director to send notice by mail at least forty-eight hours or by
telegram at least twenty-four hours before the meeting, addressed to
him at his usual or last known business or residence address or to
give notice to him in person or by telephone at least twelve hours
before the meeting. Notice of a meeting need not be given to any
director if a written waiver of notice, executed by him before or
after the meeting, is filed with the records of the meeting, or to any
director who attends the meeting without protesting prior thereto or
at its commencement the lack of notice to him. Neither notice of a
meeting nor a waiver of notice need specify the purposes of the
meeting.