e424b5
Filed
Pursuant to Rule 424(b)(5)
Registration Statement
No. 333-162675
PROSPECTUS SUPPLEMENT
(To Prospectus dated November 2, 2009)
1,700,000 Shares
Common Stock
$19.50 per share
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G-III Apparel Group, Ltd. is offering 1,700,000 shares of
common stock.
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The last reported sale price of our common stock on
December 15, 2009 was $21.25 per share.
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Trading symbol: Nasdaq Global Select Market GIII
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This investment involves risk. See Risk Factors
beginning on
page S-5
of this prospectus supplement.
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Per Share
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Total
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Public offering price
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$
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19.50
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$
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33,150,000
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Underwriting discount
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$
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1.17
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$
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1,989,000
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Proceeds, before expenses, to G-III Apparel Group, Ltd.
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$
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18.33
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$
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31,161,000
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The underwriters have a
30-day
option to purchase up to 255,000 additional shares of common
stock from us to cover over-allotments, if any.
The underwriters expect to deliver the shares against payment on
or about December 21, 2009.
Neither the Securities and Exchange Commission nor any state
securities commission has approved of anyones investment
in these securities or determined if this prospectus supplement
and the accompanying prospectus are truthful or complete. Any
representation to the contrary is a criminal offense.
Sole Book-Running
Manager
Piper Jaffray
Co-Lead Manager
Lazard Capital
Markets
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Brean
Murray, Carret & Co. |
KeyBanc Capital Markets |
The date of this prospectus supplement is December 16, 2009.
TABLE OF
CONTENTS
Prospectus Supplement
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Page
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S-5
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S-14
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S-14
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S-14
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S-15
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S-16
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S-19
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S-19
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S-19
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Prospectus
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This document consists of two parts: this prospectus supplement
and the accompanying prospectus. The accompanying prospectus is
part of a registration statement that we filed with the
Securities and Exchange Commission using a shelf
registration process. Under the shelf registration process, we
may sell the securities described in the accompanying prospectus
in one or more offerings. This prospectus supplement describes
the specific terms of this common stock offering and adds,
updates and changes information contained in the accompanying
prospectus. To the extent inconsistent, information in this
prospectus supplement supersedes information in the accompanying
prospectus.
You should rely only on the information contained in or
incorporated by reference into this prospectus supplement, the
accompanying prospectus and any free writing
prospectus we may authorize to be delivered to you. We
have not, and the underwriters have not, authorized any other
person to provide you with different information. This
prospectus supplement and the accompanying prospectus are not an
offer to sell, nor are they seeking an offer to buy, these
securities in any jurisdiction where the offer or sale is not
permitted. You should not assume that information appearing in
this prospectus supplement, the accompanying prospectus or the
documents incorporated by reference herein or therein is
accurate as of any date other than their respective dates.
In this prospectus supplement, G-III,
we, us, and our refer to
G-III Apparel Group, Ltd., a Delaware corporation, together with
its subsidiaries. References to fiscal years refer to the year
ended or ending on January 31 of that year. For example, our
fiscal year ended January 31, 2009 is referred to as
fiscal 2009.
SUMMARY
The following summary is qualified in its entirety by the
more detailed information included elsewhere in this prospectus
supplement and the accompanying prospectus. Because this is a
summary, it may not contain all the information that may be
important to you. Before deciding whether to invest in our
common stock, you should read the entire prospectus supplement
and the accompanying prospectus carefully, including the risks
of investing in our common stock that we describe under
Risk Factors, our financial statements and the
related notes, and the other information included in the
documents incorporated herein by reference.
Business
of G-III Apparel Group, Ltd.
G-III designs, manufactures and markets an extensive range of
outerwear, sportswear and accessories, including coats, jackets
and pants, as well as womens suits and dresses. We sell
our products under licensed brands, our own proprietary brands
and private retail labels. We provide high quality apparel under
recognized brands to a cross section of leading retailers such
as Macys, Bloomingdales, Nordstrom, JC Penney and
Kohls. We also operate 121 retail stores, of which 118 are
outlet stores operated under the Wilsons Leather name. We
distribute our products through a diverse mix and a large number
of retailers at a variety of price points, as well as through
our own retail stores.
We have expanded our portfolio of licensed and proprietary
brands over the past 15 years through acquisitions and by
entering into license agreements for new brands or for
additional products under previously licensed brands.
Selling products under well-known licensed brands is an
important part of our strategy. We have licenses to produce
branded fashion apparel, including under the Calvin Klein, Sean
John, Kenneth Cole, Cole Haan, Guess?, Jones New York, Jessica
Simpson, Nine West, Ellen Tracy, Tommy Hilfiger, Enyce,
Levis and Dockers brands. We also have sports licenses
with the National Football League, National Basketball
Association, Major League Baseball, National Hockey League,
Touch by Alyssa Milano and more than 100 U.S. colleges and
universities.
G-III sells outerwear and handbags under our own Andrew Marc and
Marc New York brands and has licensed these brands for
womens footwear, mens accessories, womens
handbags and mens cold weather accessories. Our other
owned brands include Marvin Richards, G-III, Jessica Howard,
Eliza J., Black Rivet, Siena Studio, Tannery West, G-III by Carl
Banks and Winlit. We also work with a diversified group of
retailers, such as Macys, JC Penney and Kohls, in
developing private label product lines.
We have made five acquisitions since July 2005, which have
helped to broaden our product offerings, expand our ability to
serve different tiers of distribution and add a retail component
to our business. Our acquisitions are part of our strategy to
expand our product offerings and increase the portfolio of
proprietary and licensed brands that we offer through different
tiers of retail distribution. We believe that our two most
recent acquisitions completed in 2008, of Andrew Marc and the
Wilsons retail outlet business, leverage our core strength in
outerwear and provide us with new avenues for growth. We also
believe that these acquisitions complement our other licensed
brands, G-III owned brands and private label programs.
Recent
Initiatives
We are continually seeking opportunities to produce products for
all seasons as we attempt to reduce our dependency on our third
fiscal quarter for the majority of our net sales and
substantially all of our net income. We have initiated the
following diversification efforts:
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We have continually expanded our relationship with Calvin Klein,
which initially consisted of licenses for mens and
womens outerwear. Since August 2005, we have added
licenses for womens suits, dresses and womens
performance wear. Most recently, in August 2008, we added a
license with Calvin Klein for womens better sportswear.
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Our acquisition of Andrew Marc added a strong proprietary brand
to our portfolio. In addition to mens and womens
outerwear, Andrew Marc sells handbags. We believe the Andrew
Marc brand can be
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S-1
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leveraged into a variety of new categories to become a
meaningful lifestyle brand. We have entered into agreements to
license the Andrew Marc and Marc New York brands for
womens footwear, mens accessories, womens
handbags and mens cold weather accessories.
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Our acquisition of the Wilsons retail outlet business added a
vertical retail component to our business. These outlet stores
have provided an additional distribution network for our
outerwear products.
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Competitive
Strengths
We intend to capitalize on the following competitive strengths:
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Broad portfolio of recognized brands. We have
built a broad and deep portfolio of over 30 licensed and
proprietary brands. We believe we are a licensee of choice for
well-known brands that have built a loyal following of both
fashion-conscious consumers and retailers who desire high
quality, well designed apparel. We have selectively added the
licensing rights to premier brands in womens, mens
and sports categories catering to a wide range of customers. In
addition to our licensed brands, we own several successful
proprietary brands, including Andrew Marc and Marc New York. Our
experience in developing and acquiring licensed brands and
proprietary labels, as well as our reputation for producing high
quality, well-designed apparel, has led major department stores
and retailers, including Macys, JC Penney and Kohls,
to select us as a designer and manufacturer for their private
label programs.
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Diversified distribution base. We market our
products at multiple price points and across multiple channels
of distribution, allowing us to provide products to a broad
range of consumers, while reducing our reliance on any one
demographic segment, merchandise preference or distribution
channel. Our products are sold to approximately 2,500 customers,
including a cross section of leading retailers such as
Macys, Bloomingdales, Nordstrom, JC Penney and
Kohls, and membership clubs such as Costco and Sams
Club. Our Wilsons retail outlet stores provide an additional
distribution network for our outerwear products.
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Superior design, sourcing and quality
control. Our in-house design and merchandising
team designs substantially all of our licensed, proprietary and
private label products. Our designers work closely with our
licensors and private label customers to create designs and
styles that represent the look they want. We believe that our
creative design team and our sourcing expertise give us an
advantage in product development. We believe we have developed a
significant customer following and positive reputation in the
industry as a result of our design capabilities, sourcing
expertise, on-time delivery and high standards of quality
control.
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Leadership position in the outerwear wholesale
business. As one of the largest outerwear
wholesalers, we are widely recognized within the apparel
industry for our high-quality and well-designed products. We
believe that our acquisition of Andrew Marc reinforces our
leadership position in the outerwear business. Our expertise and
reputation in designing, manufacturing and marketing outerwear
have enabled us to build strong customer and licensor
relationships and to expand into womens suits, dresses and
other product categories.
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Experienced management team. Our executive
management team has extensive experience in the apparel
industry. Morris Goldfarb, our Chief Executive Officer, has been
with us for 35 years. Sammy Aaron, our Vice Chairman who
joined us in 2005 when we acquired Marvin Richards, has more
than 25 years experience in the apparel industry. Jeanette
Nostra, our President, has been with us for over 25 years,
and Wayne S. Miller, our Chief Operating Officer, has been with
us for over ten years. In addition, David Winn, who heads up our
Winlit division that was acquired in 2005, has more than
25 years experience in the apparel industry.
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S-2
Growth
Strategy
Our goal is to build an all-season diversified apparel company
with a broad portfolio of brands that we offer in multiple
channels of retail distribution through the following growth
strategies:
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Execute new initiatives. We are continually
seeking opportunities to produce products for all seasons as we
attempt to reduce our dependency on our third fiscal quarter for
the majority of our net sales and substantially all of our net
income.
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Continue to grow our outerwear business. We
have been a leader in the outerwear business for many years and
believe there is significant growth potential for us in this
category. Specifically, our Calvin Klein mens and
womens outerwear businesses benefit from Calvin
Kleins strong brand awareness and loyalty among consumers.
Our acquisition of Andrew Marc added two well known proprietary
brands in the mens and womens outerwear market, as
well as licenses for mens and womens outerwear under
the Levis and Dockers brands.
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Extend our new product categories to additional
brands. We have been able to leverage our
expertise and experience in the outerwear business to expand our
licenses to new product categories such as womens suits,
dresses and sportswear. Most recently, we added licenses for
Calvin Klein womens performance wear and womens
better sportswear. We will attempt to expand our distribution of
products in these and other categories under licensed brands,
our own brands and private label brands.
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Seek attractive acquisitions. We plan to
continue to pursue acquisitions of complementary product lines
and businesses, which could include wholesale and retail
opportunities. Our acquisitions have increased our portfolio of
licensed and proprietary brands, allowed us to realize economies
of scale and added a retail component to our business. We
believe that our existing infrastructure and management depth
will enable us to complete additional acquisitions in the
apparel industry.
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Recent
Developments
For the three months ended October 31, 2009, net sales
increased by 3.4% to $363.5 million from
$351.6 million in the same quarter of last year. Net income
for the three months ended October 31, 2009 increased by
12.2% to $32.3 million, or $1.87 per diluted share,
compared to $28.8 million, or $1.68 per diluted share, in
the prior years period.
For the nine months ended October 31, 2009, net sales
increased by 12.3% to $607.0 million from
$540.5 million in the same period last year. Net income for
the nine months ended October 31, 2009 increased by 25.5%
to $22.7 million, or $1.33 per diluted share, compared to
$18.1 million, or $1.07 per diluted share, in the same
period last year.
A table summarizing financial results follows:
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Three Months Ended
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Nine Months Ended
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Oct. 31,
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Oct. 31,
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Oct. 31,
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Oct. 31,
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2008
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2009
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2008
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2009
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(In thousands, except share and
per share amounts)
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Net sales
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$
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351,599
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$
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363,540
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$
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540,458
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$
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607,029
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Operating profit
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51,682
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57,587
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35,058
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42,750
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Net income
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$
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28,836
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$
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32,303
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$
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18,096
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$
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22,708
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Net income per share:
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Basic
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$
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1.74
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$
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1.93
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$
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1.10
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$
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1.36
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Diluted
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$
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1.68
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$
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1.87
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$
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1.07
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$
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1.33
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Weighted average shares outstanding:
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Basic
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16,526
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16,770
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16,507
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16,740
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Diluted
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17,160
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17,238
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16,990
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17,011
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S-3
Corporate
Background
We are a Delaware corporation that was formed in 1989. We and
our predecessors have conducted our business since 1974. Our
executive offices are located at 512 Seventh Avenue, New York,
New York 10018 and our telephone number is
(212) 403-0500.
Our website is
http://www.g-iii.com.
The information on our website is not part of this prospectus
supplement or the accompanying prospectus.
The
Offering
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Common stock offered |
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1,700,000 shares |
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Common stock outstanding after this offering |
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18,571,719 shares |
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Use of proceeds |
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We expect to use the net proceeds of this offering for general
corporate purposes to support the growth of our business. The
net proceeds may also be used to acquire complementary product
lines or businesses. Although we regularly investigate possible
acquisitions, we have no existing commitments or agreements with
respect to any particular acquisition. |
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Nasdaq Global Select Market symbol |
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GIII |
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Risk factors |
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See Risk Factors beginning on
page S-5
of this prospectus supplement for a discussion of factors you
should consider carefully before deciding whether to invest in
our common stock. |
The number of shares of common stock to be outstanding after
this offering is based on 16,871,719 shares outstanding as
of December 9, 2009. It excludes, as of that date:
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863,800 shares of common stock issuable upon the exercise
of outstanding options, with a weighted average exercise price
of $10.86 per share;
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502,250 shares of common stock issuable upon the vesting of
restricted stock awards;
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375,000 shares of common stock issuable upon the exercise
of outstanding warrants, with a weighted average exercise price
of $11.00 per share; and
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2,687,124 shares of common stock reserved for future grants
under our stock incentive plans.
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Except as otherwise noted, the information in this prospectus
supplement assumes no exercise by the underwriters of their
over-allotment option.
S-4
RISK
FACTORS
An investment in our common stock involves a high degree of
risk. You should carefully consider the risk factors described
below, together with the other information included or
incorporated by reference in this prospectus supplement and the
accompanying prospectus before you decide to invest in our
common stock. The risks described below are the material risks
of which we are currently aware; however, they may not be the
only risks that we may face. Additional risks and uncertainties
not currently known to us or that we currently view as
immaterial may also impair our business. If any of these risks
develop into actual events, it could materially and adversely
affect our business, financial condition, results of operations
and cash flows, the trading price of our common stock could
decline and you may lose all or part of your investment.
Risk
Factors Relating to Our Licensed and Non-Licensed Wholesale
Apparel Business
The failure to maintain our license agreements could cause us
to lose significant revenues and have a material adverse effect
on our results of operations. We are dependent on
sales of licensed product for a substantial portion of our
revenues. In fiscal 2009, revenues from the sale of licensed
product accounted for 60.5% of our net sales (68.0% of net sales
of wholesale apparel) compared to 70.3% of our net sales in
fiscal 2008 and 63.0% of our net sales in fiscal 2007.
We are generally required to achieve specified minimum net
sales, make specified royalty and advertising payments and
receive prior approval of the licensor as to all design and
other elements of a garment prior to production. License
agreements also may restrict our ability to enter into other
license agreements for competing products. If we do not satisfy
any of these requirements, a licensor usually will have the
right to terminate our license. Even if a licensor does not
terminate our license, the failure to achieve net sales
sufficient to cover our required minimum royalty payments could
have a material adverse effect on our results of operations. If
a license contains a renewal provision, there are usually
minimum sales and other conditions that must be met in order to
be able to renew a license. Even if we comply with all the terms
of a license agreement, we cannot be sure that we will be able
to renew an agreement when it expires even if we desire to do
so. The failure to maintain our license agreements could cause
us to lose significant revenue and have a material adverse
effect on our results of operations.
Our success is dependent on the strategies and reputation of
our licensors. Our business strategy is to offer
our products on a multiple brand, multiple channel and multiple
price point basis. As a part of this strategy, we license the
names and brands of numerous recognized companies, designers and
celebrities. In entering into these license agreements, we plan
our products to be targeted towards different market segments
based on consumer demographics, design, suggested pricing and
channel of distribution. If any of our licensors decides to
reposition its products under the brands we license
from them, introduce similar products under similar brand names
or otherwise change the parameters of design, pricing,
distribution, target market or competitive set, we could
experience a significant downturn in that brands business,
adversely affecting our sales and profitability. We have six
different license agreements relating to a variety of products
sold under the Calvin Klein brand that is owned by Phillips-Van
Heusen Corporation. Any change by Phillips-Van Heusen in the
marketing of products sold under the Calvin Klein label, or any
adverse change in our relationship with Phillips Van-Heusen,
could have a material adverse affect on our results of
operations. In addition, as licensed products may be personally
associated with designers or celebrities, our sales of those
products could be materially and adversely affected if any of
those individuals images, reputations or popularity were
to be negatively impacted.
If we are unable to successfully translate market trends into
attractive product offerings, our sales and profitability could
suffer. Our ability to successfully compete
depends on a number of factors, including our ability to
effectively anticipate, gauge and respond to changing consumer
demands and tastes across multiple product lines and tiers of
distribution. We are required to translate market trends into
attractive product offerings and operate within substantial
production and delivery constraints. We cannot be sure we will
continue to be successful in this regard. We need to anticipate
and respond to changing trends quickly, efficiently and
effectively in order to be successful.
S-5
Expansion of our product offerings involves significant costs
and uncertainty and could adversely affect our results of
operations. An important part of our strategy is
to expand the types of products we offer. During the past three
years, we have added licenses for new lines of womens
suits, dresses, performance wear and sportswear. In addition, we
acquired a dress and sportswear manufacturer. We have limited
prior experience designing, manufacturing and marketing these
types of products. We intend to continue to add additional
product lines in the future. As is typical with new products,
demand and market acceptance for any new products we introduce
will be subject to uncertainty. Designing, producing and
marketing new products require substantial expenditures. We
cannot be certain that our efforts and expenditures will
successfully generate sufficient sales or that sales that are
generated will be sufficient to cover our expenditures. For
example, in March 2006, we entered into a license for
womens sportswear under the Sean John label. This license
was mutually terminated in January 2008, resulting in a charge
to earnings in the fourth quarter of fiscal 2008.
If our customers change their buying patterns, request
additional allowances or develop their own private label brands,
our sales to these customers could be materially adversely
affected. Our customers buying patterns, as
well as the need to provide additional allowances to vendors,
could have a material adverse effect on our business, results of
operations and financial condition. Customers strategic
initiatives, including developing their own private labels
brands and reducing the number of vendors they purchase from,
could also impact our sales to these customers.
We have significant customer concentration, and the loss of
one of our large customers could adversely affect our
business. Our 10 largest customers accounted for
approximately 56.6% of our net sales in fiscal 2009 and 59.7% of
our net sales in fiscal 2008, with our largest customer
accounting for 15.4% of our net sales in fiscal 2009.
Consolidation in the retail industry has increased the
concentration of our sales to our largest customers. We do not
have long-term contracts with any customers, and sales to
customers generally occur on an
order-by-order
basis that may be subject to cancellation or rescheduling by the
customer. A decision by our major customers to decrease the
amount of merchandise purchased from us, to increase the use of
their own private label brands or to change the manner of doing
business with us could reduce our revenues and materially
adversely affect our results of operations. The loss of any of
our large customers, or the bankruptcy or serious financial
difficulty of any of our large customers, could have a material
adverse effect on us.
If we miscalculate the market for our products, we may end up
with significant excess inventories for some products and missed
opportunities for others. We often produce
garments to hold in inventory in order to meet our
customers delivery requirements and to be able to quickly
fulfill reorders. If we misjudge the market for our products, we
may be faced with significant excess inventories for some
products and missed opportunities for others. In addition, weak
sales and resulting markdown requests from customers could have
a material adverse effect on our results of operations.
We are dependent upon foreign
manufacturers. We do not own or operate any
manufacturing facilities. We also do not have long-term written
agreements with any of our manufacturers. As a result, any of
these manufacturers may unilaterally terminate its relationship
with us at any time. Almost all of our products are imported
from independent foreign manufacturers. The failure of these
manufacturers to ship products to us in a timely manner or to
meet required quality standards could cause us to miss the
delivery date requirements of our customers. The failure to make
timely deliveries could cause customers to cancel orders, refuse
to accept delivery of products or demand reduced prices.
We are also dependent on these manufacturers for compliance with
our policies and the policies of our licensors and customers
regarding labor practices employed by factories that manufacture
product for us. Any failure by these manufacturers to comply
with required labor standards or any other divergence in their
labor or other practices from those generally considered ethical
in the United States, and the potential negative publicity
relating to any of these events, could result in a violation by
us of our license agreements and harm us and our reputation. In
addition, a manufacturers failure to comply with safety or
content regulations and standards could result in substantial
liability and harm to our reputation.
S-6
We are subject to the risks of doing business
abroad. Our arrangements with foreign
manufacturers are subject to the usual risks of doing business
abroad, including currency fluctuations, political or labor
instability and potential import restrictions, duties and
tariffs. We do not maintain insurance for the potential lost
profits due to disruptions of our overseas manufacturers.
Because our products are produced abroad, primarily in China,
political or economic instability in China or elsewhere could
cause substantial disruption in the business of our foreign
manufacturers. For example, in the past, the Chinese government
has reduced tax rebates to factories for the manufacture of
textile and leather garments. The rebate reduction resulted in
factories seeking to recoup more of their costs from customers,
resulting in higher prices for goods imported from China. This
tax rebate has been reinstated in certain instances. However,
new or increased reductions in this rebate would cause an
increase in the cost of finished garments from China which could
materially adversely affect our financial condition and results
of operations.
There have been threats of anti-dumping cases with respect to
apparel sourced from several countries, including China and
Vietnam. Heightened terrorism security concerns could subject
imported goods to additional, more frequent or more thorough
inspections. This could delay deliveries or increase costs,
which could adversely impact our results of operations. In
addition, since we negotiate our purchase orders with foreign
manufacturers in United States dollars, the decline in value of
the United States dollar against local currencies would
negatively impact our cost in dollars of product sourced from
these manufacturers. We are not currently engaged in any hedging
activities to protect against currency risks. If there is
downward pressure on the value of the dollar, our purchase
prices for our products could increase. We may not be able to
offset an increase in product costs with a price increase to our
customers.
Fluctuations in the price, availability and quality of
materials used in our products could have a material adverse
effect on our cost of goods sold and our ability to meet our
customers demands. Fluctuations in the
price, availability and quality of the leather, wool and other
materials used in our products could have a material adverse
effect on our cost of sales or our ability to meet our
customers demands. We compete with numerous entities for
supplies of materials and manufacturing capacity. The supply and
price of leather are vulnerable to animal diseases as well as
natural disasters that can affect the supply and price of raw
leather. For example, in the past, the outbreak of mad-cow and
foot-and-mouth
disease in Europe, and its aftereffects, adversely affected the
supply and cost of leather. Any recurrence of these diseases
could adversely affect us. The prices for wool and other fabrics
used in our products depend largely on the market prices for the
raw materials used to produce them, such as raw wool or cotton.
We may not be able to pass on all or any portion of higher
material prices to our customers.
Risks
Relating to Our Retail Outlet Business
Expansion of our business into the retail sector involves
significant costs and uncertainties. In July
2008, we acquired 116 outlet store leases, as well as inventory,
fixtures, a warehouse location and trademarks and trade names,
from Wilsons The Leather Experts. Managing the Wilsons outlet
stores requires the expenditure of our time and resources.
Operation of a retail chain could divert our managements
time and resources from our core wholesale apparel business.
Operation of a retail chain could be viewed as competitive by
our licensors and existing retail customers and adversely affect
our relationships with them. Accordingly, the acquisition of the
Wilsons retail outlet business could negatively impact our
results of operations.
We will need to improve the results of operations of the
acquired Wilsons retail outlet stores in order for these stores
to operate profitably for us. We have no experience operating a
retail chain. Prior to our acquisition of the
Wilsons retail outlet stores, these stores as a whole were
experiencing declines in comparable store sales, sales per
square foot and gross margins. The operation of these stores
negatively impacted our results of operations in fiscal 2009. We
will need to improve store operations and upgrade merchandise
offered at these stores in order for these stores to operate
profitably for us. We had no experience operating a retail chain
prior to this acquisition and cannot be sure we will be able to
improve the operations of these stores. If we cannot improve the
results of operations of these stores, this acquisition could
have a material adverse effect on our result of operations.
S-7
Leasing of significant amounts of real estate exposes us to
possible liabilities and losses. All of the
Wilsons retail outlet stores acquired by us in July 2008 are
leased. Accordingly, we are subject to all of the risks
associated with leasing real estate. Store leases generally
require us to pay a fixed minimum rent and a variable amount
based on a percentage of annual sales at that location. We
generally cannot cancel our leases. If an existing or future
store is not profitable, and we decide to close it, we may be
committed to perform certain obligations under the applicable
lease including, among other things, paying rent for the balance
of the applicable lease term. As each of our leases expires, if
we do not have a renewal option, we may be unable to negotiate a
renewal, on commercially acceptable terms or at all, which could
cause us to close stores in desirable locations. In addition, we
may not be able to close an unprofitable store due to an
existing operating covenant, which may cause us to operate the
location at a loss and prevent us from finding a more desirable
location.
Our retail outlet stores are heavily dependent on the ability
and desire of consumers to travel and shop. A reduction in the
volume of outlet mall traffic could adversely affect our retail
sales. Our retail outlet stores are located in
outlet malls, which are typically located in or near vacation
destinations or away from large population centers where
department stores and other traditional retailers are
concentrated. As a result of the current economic problems in
the U.S., fuel shortages, increased fuel prices, travel concerns
and other circumstances, which would lead to decreased travel,
could have a material adverse affect on sales at our outlet
stores. Other factors which could affect the success of our
outlet stores include:
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the location of the outlet mall or the location of a particular
store within the mall;
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the other tenants occupying space at the outlet mall;
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increased competition in areas where the outlet malls are
located;
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a continued downturn in the economy generally or in a particular
area where an outlet mall is located; and
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the amount of advertising and promotional dollars spent on
attracting consumers to the outlet malls.
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Sales at our stores are derived, in part, from the volume of
traffic at the malls where our stores are located. Our stores
benefit from the ability of a malls other tenants and
other area attractions to generate consumer traffic in the
vicinity of our stores and the continuing popularity of outlet
malls as shopping destinations. A reduction in outlet mall
traffic as a result of these or other factors could materially
adversely affect our business.
The retail business is intensely competitive and increased or
new competition could have a material adverse effect on
us. The retail industry is intensely competitive.
We compete against a diverse group of retailers, including,
among others, other outlet stores, department stores, specialty
stores, warehouse clubs and
e-commerce
retailers. We also compete in particular markets with a number
of retailers that specialize in the products that we sell. A
number of different competitive factors could have a material
adverse effect on our retail business, results of operations and
financial condition including:
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increased operational efficiencies of competitors;
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competitive pricing strategies, including deep discount pricing
by a broad range of retailers during periods of poor consumer
confidence or economic instability, such as the deep discounts
offered during the 2008 holiday season and thereafter;
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expansion of product offerings by existing competitors;
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entry by new competitors into markets in which we operate retail
stores; and
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adoption by existing competitors of innovative retail sales
methods.
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We may not be able to continue to compete successfully with our
existing or new competitors, or be assured that prolonged
periods of deep discount pricing by our competitors will not
have a material adverse effect on our business.
S-8
A privacy breach could adversely affect our
business. The protection of customer, employee,
and company data is critical to us. The regulatory environment
surrounding information security and privacy is increasingly
demanding, with the frequent imposition of new and constantly
changing requirements across business units. In addition,
customers have a high expectation that we will adequately
protect their personal information. A significant breach of
customer, employee, or company data could damage our reputation
and result in lost sales, fines, or lawsuits.
Risk
Factors Relating to the Operation of Our Business
If we lose the services of our key personnel, our business
will be harmed. Our future success depends on
Morris Goldfarb, our Chairman and Chief Executive Officer, and
other key personnel. The loss of the services of
Mr. Goldfarb and any negative market or industry perception
arising from the loss of his services could have a material
adverse effect on us and the price of our shares. Our other
executive officers have substantial experience and expertise in
our business and have made significant contributions to our
success. The unexpected loss of services of one or more of these
individuals could also adversely affect us.
We have expanded our business through acquisitions that could
result in diversion of resources, an inability to integrate
acquired operations and extra expenses. This could disrupt our
business and adversely affect our financial
condition. Part of our growth strategy is to
pursue acquisitions. In July 2005, we acquired Marvin Richards
and the operating assets of Winlit, in May 2007, we acquired the
operating assets of Jessica Howard, in February 2008, we
acquired Andrew Marc and in July 2008, we acquired certain
assets related to the Wilsons retail outlet business. The
negotiation of potential acquisitions as well as the integration
of acquired businesses could divert our managements time
and resources. Acquired businesses may not be successfully
integrated with our operations. We may not realize the intended
benefits of any acquisition. For example, the results of Wilsons
adversely affected our results of operations in fiscal 2009.
Acquisitions could also result in:
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substantial cash expenditures;
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potentially dilutive issuances of equity securities;
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the incurrence of debt and contingent liabilities;
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a decrease in our profit margins;
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amortization of intangibles and potential impairment of goodwill;
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reduction of management attention to other parts of our business;
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failure to generate expected financial results or reach business
goals; and
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increased expenditures on human resources and related costs.
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If acquisitions disrupt our operations, our business may suffer.
We may need additional financing to continue to
grow. The continued growth of our business
depends on our access to sufficient funds to support our growth.
Our primary source of working capital to support our growth is
our line of credit which, in April 2008, was extended to July
2011. Our need for working capital and the amount of our debt
has increased significantly as a result of our five acquisitions
since July 2005. The maximum available under our line of credit
has increased from $110 million prior to our acquisitions
in July 2005 to its current level of $250 million. Our
growth is dependent on our ability to continue to be able to
extend and increase the line of credit. If we are unable to
refinance our debt, we cannot be sure we will be able to secure
alternative financing on satisfactory terms or at all.
Our business is highly seasonal. Our results of operations
may suffer in the event that the weather is unusually warm
during the peak outerwear selling season. Retail
sales of outerwear have traditionally been seasonal in nature.
Sales of outerwear constitute a significant majority of our
sales. As a result, in prior years we have been dependent on our
sales from July through November for the substantial majority of
our net sales and net income. Net sales in the months of July
through November accounted for approximately 70% of our
S-9
net sales in fiscal 2009, 75% of our net sales in fiscal 2008
and 81% of our net sales in fiscal 2007. The Andrew Marc
business we acquired in February 2008 experiences seasonality
similar to our other wholesale outerwear businesses. Our Wilsons
retail outlet business, acquired in July 2008, is also highly
seasonal, with the third and fourth fiscal quarters accounting
for a significant majority of its sales and operating income. As
a result, we will be highly dependent on our results of
operations during the second half of our fiscal year. Any
difficulties we may encounter during this period as a result of
weather or disruption of manufacturing or transportation of our
products will have a magnified effect on our net sales and net
income for the year. In addition, because of the large amount of
outerwear we sell at both wholesale and retail, unusually warm
weather conditions during the peak fall and winter outerwear
selling season could have a material adverse effect on our
results of operations. Our quarterly results of operations for
our retail business also may fluctuate based upon such factors
as the timing of certain holiday seasons, the number and timing
of new store openings, the acceptability of seasonal merchandise
offerings, the timing and level of markdowns, store closings and
remodels, competitive factors, weather and general economic
conditions. The second half of the year is expected to continue
to provide a disproportionate amount of our net sales and net
income for the foreseeable future.
Risk
Factors Relating to the Economy and the Apparel
Industry
Recent and future economic conditions, including turmoil in
the financial and credit markets, may adversely affect our
business. The current economic and credit crisis
is having a significant negative impact on businesses around the
world. The impact of this crisis on the apparel industry and our
major customers has been quite severe. Conditions may continue
to be depressed or may be subject to further deterioration which
could lead to a further reduction in consumer spending overall,
which could have an adverse impact on sales of our products. A
disruption in the ability of our significant customers to access
liquidity could cause serious disruptions or an overall
deterioration of their businesses which could lead to a
significant reduction in their orders of our products and the
inability or failure on their part to meet their payment
obligations to us, any of which could have a material adverse
effect on our results of operations and liquidity. A significant
adverse change in a customers financial
and/or
credit position could also require us to assume greater credit
risk relating to that customers receivables or could limit
our ability to collect receivables related to previous purchases
by that customer. As a result, our reserves for doubtful
accounts and write-offs of accounts receivable may increase.
Our ability to continue to have the necessary liquidity to
operate our business may be adversely impacted by a number of
factors, including a continuation of the difficult conditions in
the credit and financial markets which could limit the
availability and increase the cost of financing. A deterioration
of our results of operations and cash flow resulting from
continued decreases in consumer spending, could, among other
things, impact our ability to comply with financial covenants in
our existing credit facility. Our historical
sources of liquidity to fund ongoing cash requirements include
cash flows from operations, cash and cash equivalents, as well
as borrowings through our loan agreement (which includes
revolving and trade letter of credit facilities). The
sufficiency and availability of credit may be adversely affected
by a variety of factors, including, without limitation, the
substantial tightening of the credit markets, including lending
by financial institutions who are sources of credit for our
borrowing and liquidity; an increase in the cost of capital; the
reduced availability of credit; our ability to execute our
strategy; the level of our cash flows, which will be impacted by
retailer and consumer acceptance of our products and the level
of consumer discretionary spending; maintenance of financial
covenants included in our loan agreement; and interest rate
fluctuations. We cannot be certain that any additional required
financing, whether debt or equity, will be available in amounts
needed or on terms acceptable to us, if at all.
As of October 31, 2009, we were in compliance with the
financial covenants in our loan agreement. Compliance with these
financial covenants is dependent on the results of our
operations, which are subject to a number of factors including
current economic conditions. The current economic environment
has resulted generally in lower consumer confidence and lower
retail sales. A continuation of this trend may lead to further
reduced consumer spending which could adversely impact our net
sales and cash flow, which could affect our compliance with our
financial covenants. A violation of our covenants could limit
access to our credit
S-10
facilities. Should such restrictions on our credit facilities
and these factors occur, they could have a material adverse
effect on our business and results of operations.
The cyclical nature of the apparel industry and uncertainty
over future economic prospects and consumer spending could have
a materially adverse effect on our results of
operations. The apparel industry is cyclical.
Purchases of outerwear, sportswear and other apparel tend to
decline during recessionary periods and may decline for a
variety of other reasons, including changes in fashion trends
and the introduction of new products or pricing changes by our
competitors. Uncertainties regarding future economic prospects
affected consumer-spending habits and had an adverse effect on
our results of operations in fiscal 2009. Uncertainty with
respect to consumer spending as a result of weak economic
conditions has caused our customers to delay the placing of
initial orders and to slow the pace of reorders during the
seasonal peak of our business. Weak economic conditions have had
a material adverse effect on our results of operations at times
in the past and could have a material adverse effect on our
results of operations in the future as well.
The competitive nature of the apparel industry may result in
lower prices for our products and decreased gross profit
margins. The apparel business is highly
competitive. We have numerous competitors with respect to the
sale of apparel, including distributors that import apparel from
abroad and domestic retailers with established foreign
manufacturing capabilities. Many of our competitors have greater
financial and marketing resources and greater manufacturing
capacity than we do. We also compete with vertically integrated
apparel manufacturers that also own retail stores. The general
availability of contract manufacturing capacity also allows ease
of access by new market entrants. The competitive nature of the
apparel industry may result in lower prices for our products and
decreased gross profit margins, either of which may materially
adversely affect our sales and profitability. Sales of our
products are affected by style, price, quality, brand reputation
and general fashion trends.
If major department, mass merchant and specialty store chains
continue to consolidate, our business could be negatively
affected. We sell our products to major
department, mass merchant and specialty store chains. Continued
consolidation in the retail industry could negatively impact our
business. Consolidation could reduce the number of our customers
and potential customers. With increased consolidation in the
retail industry, we are increasingly dependent on retailers
whose bargaining strength may increase and whose share of our
business may grow. As a result, we may face greater pressure
from these customers to provide more favorable terms, including
increased support of their retail margins. As purchasing
decisions become more centralized, the risks from consolidation
increase. A store group could decide to decrease the amount of
product purchased from us, modify the amount of floor space
allocated to outerwear or other apparel in general or to our
products specifically or focus on promoting private label
products rather than our products. Customers are also
concentrating purchases among a narrowing group of vendors.
These types of decisions by our key customers could adversely
affect our business.
A significant increase in fuel prices could adversely affect
our results of operations. Fuel prices have
increased significantly at times during the past few years.
Increased gasoline prices could adversely affect consumer
spending, including discretionary spending on apparel. In
addition, higher fuel prices have caused our operating expenses
to increase, particularly for freight. Any significant decrease
in sales or increase in expenses as a result of higher fuel
prices could adversely affect our results of operations.
If new legislation restricting the importation or increasing
the cost of textiles and apparel produced abroad is enacted, our
business could be adversely affected. Legislation
that would restrict the importation or increase the cost of
textiles and apparel produced abroad has been periodically
introduced in Congress. The enactment of new legislation or
international trade regulation, or executive action affecting
international textile or trade agreements, could adversely
affect our business. International trade agreements that can
provide for tariffs
and/or
quotas can increase the cost and limit the amount of product
that can be imported.
Chinas accession agreement for membership in the World
Trade Organization provides that member countries, including the
United States, may impose safeguard quotas on specific products.
In May 2005, the United States imposed unilateral quotas on
several product categories, limiting growth in imports of these
categories to 7.5% a year. These safeguard quotas were
eliminated in 2009. We are unable to assess the potential for
future action by the United States government with respect to
any product category in the event
S-11
that the quantity of imported apparel significantly disrupts the
apparel market in the United States. Future action by the United
States in response to a disruption in its apparel markets could
limit our ability to import apparel and increase our costs.
The effects of war or acts of terrorism could adversely
affect our business. The continued threat of
terrorism, heightened security measures and military action in
response to acts of terrorism has, at times, disrupted commerce
and intensified concerns regarding the United States economy.
Any further acts of terrorism or new or extended hostilities may
disrupt commerce and undermine consumer confidence, which could
negatively impact our sales and results of operations.
Other
Risks Relating to Ownership of Our Common Stock and this
Offering
Our Chairman and Chief Executive Officer may be in a position
to control matters requiring a stockholder
vote. As of December 9, 2009, Morris
Goldfarb, our Chairman and Chief Executive Officer, beneficially
owned approximately 19.2% of our common stock. His significant
role in our management and his reputation in the apparel
industry could make his support crucial to the approval of any
major transaction involving us. As a result, he may have the
ability to control the outcome on matters requiring stockholder
approval including, but not limited to, the election of
directors and any merger, consolidation or sale of all or
substantially all of our assets. He also may have the ability to
control our management and affairs.
The price of our common stock has fluctuated significantly
and could continue to fluctuate
significantly. Between February 1, 2006 and
December 15, 2009, the market price of our common stock has
ranged from a high of $26.74 per share to a low of $3.24. The
market price of our common stock may change significantly in
response to various factors and events beyond our control,
including:
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fluctuations in our quarterly revenues or those of our
competitors as a result of seasonality or other factors;
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a shortfall in revenues or net income from that expected by
securities analysts and investors;
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changes in securities analysts estimates of our financial
performance or the financial performance of our competitors or
companies in our industry generally;
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announcements concerning our competitors;
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changes in product pricing policies by our competitors or our
customers;
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general conditions in our industry; and
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general conditions in the securities markets, such as the recent
broad decline in stock prices.
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Our actual financial results might vary from our publicly
disclosed financial forecasts. From time to time,
we publicly disclose financial forecasts. Our forecasts reflect
numerous assumptions concerning our expected performance, as
well as other factors which are beyond our control and which
might not turn out to be correct. As a result, variations from
our forecasts could be material. Our financial results are
subject to numerous risks and uncertainties, including those
identified throughout this Risk Factors section and
elsewhere in the documents incorporated by reference in this
prospectus supplement. If our actual financial results are worse
than our financial forecasts, the price of our common stock may
decline.
We recorded significant charges for the impairment of
goodwill and trademarks during the fourth quarter of fiscal 2009
which caused us to report a net loss for fiscal 2009. If our
goodwill and other intangibles become further impaired, we may
be required to record additional charges to
earnings. We recorded aggregate charges of
$33.5 million in the fourth quarter of fiscal 2009 for
impairment charges related to goodwill in our non-licensed
apparel segment and one of our trademarks. As a result, we
reported a net loss for fiscal 2009. As of January 31,
2009, after recording these impairment charges, we had goodwill
and other intangibles in an aggregate amount of
$46.9 million, or approximately 16.6% of our total assets
and 28.9% of our stockholders equity. Under accounting
principles generally accepted in the United States, we review
our goodwill and other intangibles for impairment annually
during the fourth quarter of each fiscal year and when events or
changes in circumstances indicate the carrying value may not be
recoverable. The carrying value of
S-12
our goodwill and other intangibles may not be recoverable due to
factors such as a decline in our stock price and market
capitalization, reduced estimates of future cash flows and
profitability and slower growth rates in our industry. Our
impairment charges in fiscal 2009 were primarily the result of a
decrease in our market capitalization and, to a lesser extent,
from a decrease in projected revenues and profitability for one
of our proprietary brands. Estimates of future cash flows and
profitability are based on an updated long-term financial
outlook of our operations. However, actual performance in the
near-term or long-term could be materially different from these
forecasts, which could impact future estimates. A further
significant decline in our market capitalization or further
deterioration in our projected results could result in
additional impairment of goodwill
and/or
intangibles. We may be required to record a significant charge
to earnings in our financial statements during a period in which
an impairment of our goodwill is determined to exist, as
happened in fiscal 2009, which would negatively impact our
results of operations and could negatively impact our stock
price.
We are subject to ongoing costs and risks associated with
complying with extensive corporate governance and disclosure
requirements. As a public company, we spend a
significant amount of management time and resources to comply
with laws, regulations and standards relating to corporate
governance and public disclosure, including under the
Sarbanes-Oxley Act of 2002, SEC regulations and Nasdaq rules.
Section 404 of the Sarbanes-Oxley Act requires
managements annual review and evaluation of our internal
control over financial reporting and attestations of the
effectiveness of these controls by our management and by our
independent registered public accounting firm. We were required
to complete our first Section 404 report with respect to
fiscal 2008. However, there is no guarantee that these efforts
will result in management assurance or an attestation by our
independent registered public accounting firm that our internal
control over financial reporting is adequate in future periods.
In connection with our compliance with Section 404 and
other applicable provisions of the Sarbanes-Oxley Act, our
management and other personnel devote a substantial amount of
time and we may need to hire additional accounting and financial
staff to assure that we comply with these requirements. The
additional management attention and costs relating to compliance
with the Sarbanes-Oxley Act and other corporate governance
requirements could materially and adversely affect our financial
results.
Future sales of our common stock, including the shares
purchased in this offering, may depress our stock
price. Sales of a substantial number of shares of
our common stock in the public market by our stockholders after
this offering, sales of our common stock by our management or
the perception that such sales are likely to occur could depress
the market price of our common stock and impair our ability to
raise capital through the sale of additional equity securities.
Upon completion of this offering, we will have outstanding
18,571,719 shares of common stock. Of these shares:
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14,955,266 shares generally will be freely tradable in the
public market, including all of the 1,700,000 shares
offered under this prospectus supplement;
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approximately 3,616,453 additional shares may be sold after
the expiration of the
90-day
lock-up
agreements entered into by our officers and directors in this
offering, subject to compliance with the volume limitations and
other restrictions of Rule 144;
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1,366,050 additional shares will be eligible for issuance
pursuant to options and restricted share units presently
outstanding under our existing stock incentive plans; and
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375,000 additional shares will be eligible for issuance pursuant
to warrants presently outstanding and exercisable at an exercise
price of $11.00 per share.
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We may issue shares of our common stock from time to time as
consideration for or to finance future acquisitions and
investments. In the event any such acquisition or investment is
significant, the number of shares of our common stock, or the
number or aggregate principal amount, as the case may be, of
other securities that we may issue may in turn be significant.
In addition, we may also grant registration rights covering
those shares of our common stock or other securities in
connection with any such acquisition or investment.
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SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus, and the
documents incorporated by reference into this prospectus
supplement and the accompanying prospectus contain
forward-looking statements within the meaning of
Section 27A of the Securities Act and Section 21E of
the Securities Exchange Act. In particular, forward-looking
statements regarding our expected performance and financial
results in future periods which include words such
as expect, believe, will,
would, may, anticipate and
similar expressions are based upon managements
current expectations and beliefs and are subject to a number of
risks and uncertainties, including those described above under
Risk Factors, that could cause actual results to
differ materially from those described in the preceding
forward-looking statements. You are cautioned not to place undue
reliance on these forward-looking statements.
USE OF
PROCEEDS
We estimate that the net proceeds from the sale of shares of our
common stock in this offering will be $30.9 million (or
approximately $35.5 million if the underwriters exercise
their overallotment option in full) after deducting the
estimated underwriting discounts and offering expenses payable
by us.
We expect to use the net proceeds for general corporate purposes
to support the growth of our business. The net proceeds may also
be used to acquire complementary product lines or businesses.
Although we regularly investigate possible acquisitions, we have
no existing commitments or agreements with respect to any
particular acquisition.
Until we use the net proceeds of this offering for the above
intended purposes, we intend to temporarily pay down any
outstanding balance under our revolving credit facility or
invest the funds in short-term, investment grade securities.
PRICE
RANGE OF COMMON STOCK
Our common stock is traded on the Nasdaq Global Select Market
under the trading symbol GIII.
The following table sets forth, for the periods indicated, the
range of high and low sales prices per share for our common
stock for each quarter in fiscal 2008, fiscal 2009 and fiscal
2010 to date, as reported by the Nasdaq Global Select Market.
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Price
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High
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Low
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Fiscal 2008
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Quarter ending April 30, 2007
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$
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26.54
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$
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17.17
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Quarter ending July 31, 2007
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|
22.00
|
|
|
|
15.13
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|
Quarter ending October 31, 2007
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|
|
21.00
|
|
|
|
13.30
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|
Quarter ending January 31, 2008
|
|
|
17.28
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|
|
|
11.02
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|
Fiscal 2009
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|
|
|
|
|
|
|
|
Quarter ending April 30, 2008
|
|
|
15.48
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|
|
|
10.73
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|
Quarter ending July 31, 2008
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|
|
18.05
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|
|
|
11.62
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|
Quarter ending October 31, 2008
|
|
|
20.58
|
|
|
|
11.36
|
|
Quarter ending January 31, 2009
|
|
|
14.28
|
|
|
|
4.77
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|
Fiscal 2010
|
|
|
|
|
|
|
|
|
Quarter ending April 30, 2009
|
|
|
8.48
|
|
|
|
3.24
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|
Quarter ending July 31, 2009
|
|
|
12.68
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|
|
|
6.58
|
|
Quarter ending October 31, 2009
|
|
|
19.81
|
|
|
|
11.50
|
|
Quarter ending January 31, 2010 (through December 15,
2009)
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|
|
22.25
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|
|
|
15.79
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As of December 9, 2009, we had 16,871,719 shares of
outstanding common stock held by 47 holders of record. The last
reported sale price of our common stock on December 15,
2009 was $21.25 per share.
S-14
CAPITALIZATION
The following table sets forth our capitalization at
October 31, 2009:
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on an actual basis; and
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as adjusted to reflect our sale by us of 1,700,000 shares
of common stock in this offering at a public offering price of
$19.50 per share, after deducting the underwriting discount and
estimated offering expenses payable by us.
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You should read this table together with our financial
statements and the related notes thereto, as well as
Managements Discussion and Analysis of Financial
Condition and Results of Operations and the other
financial information, included elsewhere or incorporated by
reference in this prospectus supplement or the accompanying
prospectus.
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As of October 31,
2009
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Actual
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As Adjusted
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(In thousands, except share and
per share amounts)
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Cash and cash equivalents
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$
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16,633
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$
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47,494
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Stockholders equity:
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Preferred stock, $.01 par value; 1,000,000 shares
authorized; no shares issued and outstanding actual and as
adjusted
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Common stock, $.01 par value; 40,000,000 shares
authorized; 17,229,294 shares issued actual and
18,929,294 shares issued as adjusted
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172
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|
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|
189
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Addition paid-in capital
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102,215
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|
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133,059
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Accumulated other comprehensive income
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(36
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)
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(36
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)
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Retained earnings
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86,250
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86,250
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188,601
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219,462
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Common stock held in treasury 367,225 shares at
cost
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|
(970
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)
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|
(970
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)
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Total stockholders equity
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187,631
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|
|
|
218,492
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Total capitalization
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$
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187,631
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$
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218,492
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S-15
UNDERWRITING
We are offering the shares of common stock described in this
prospectus supplement through a number of underwriters. Piper
Jaffray is acting as the sole book-running manager of the
offering and as representative of the underwriters. Lazard
Capital Markets, Brean Murray, Carret & Co. and
KeyBanc Capital Markets are acting as co-managers for this
offering. We have entered into a firm commitment underwriting
agreement with the underwriters. Subject to the terms and
conditions of the underwriting agreement, we have agreed to sell
to the underwriters, and each underwriter has severally agreed
to purchase, at the public offering price less the underwriting
discount set forth on the cover page of this prospectus
supplement, the number of shares of common stock listed next to
its name in the following table:
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Underwriter
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Number of Shares
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Piper Jaffray & Co.
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1,054,000
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Lazard Capital Markets LLC
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476,000
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Brean Murray, Carret & Co. LLC
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|
85,000
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KeyBanc Capital Markets Inc.
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85,000
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|
|
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Total
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1,700,000
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The underwriters are committed to purchase all the shares of
common stock offered by us if they purchase any shares, other
than those shares covered by the over-allotment option described
below. The underwriting agreement also provides that if an
underwriter defaults, the purchase commitments of non-defaulting
underwriters may also be increased or the offering may be
terminated.
The underwriters propose to offer the common stock directly to
the public at the initial public offering price set forth on the
cover page of this prospectus supplement and to certain dealers
at that price less a concession not in excess of $.585 per
share. The underwriters may allow, and certain dealers may
reallow, a discount from the concession not in excess of $.10
per share to certain brokers and dealers. After the offering,
these figures may be changed by the underwriters.
The underwriters have an option to buy up to
255,000 additional shares of common stock from us to cover
sales of shares by the underwriters which exceed the number of
shares specified in the table above. The underwriters may
exercise this option at any time and from time to time during
the 30-day
period from the date of this prospectus supplement. If any
shares are purchased with this over-allotment option, the
underwriters will purchase shares in approximately the same
proportion as shown in the table above. If any additional shares
of common stock are purchased, the underwriters will offer the
additional shares on the same terms as those on which the shares
are being offered.
The underwriting fee is equal to the public offering price per
share of common stock less the amount paid by the underwriters
to us per share of common stock. The following table shows the
per share and total underwriting discount to be paid to the
underwriters assuming both no exercise and full exercise of the
underwriters option to purchase additional shares.
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Without
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With Full
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Over-Allotment
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Over-Allotment
|
|
|
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Exercise
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|
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Exercise
|
|
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Per Share
|
|
$
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1.17
|
|
|
$
|
1.17
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Total
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|
$
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1,989,000
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|
|
$
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2,287,350
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We estimate that the total fees and expenses payable by us,
excluding the underwriting discount, will be approximately
$300,000, which includes $75,000 payable at the closing of the
offering that we have agreed to reimburse to Piper Jaffray for
the fees incurred by it in connection with the offering.
S-16
Lazard Frères & Co. LLC referred this transaction
to Lazard Capital Markets LLC and will receive a referral fee
from Lazard Capital Markets LLC in connection therewith.
We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act, or
to contribute to payments that the underwriters may be required
to make in respect of those liabilities.
We and each of our directors and executive officers are subject
to lock-up
agreements that prohibit us and them from offering for sale,
pledging, assigning, encumbering, announcing the intention to
sell, selling, contracting to sell, granting any option, right
or warrant to purchase, or otherwise transferring or disposing
of, any shares of our common stock or any securities convertible
into or exercisable or exchangeable for shares of our common
stock for a period of at least 90 days following the date
of this prospectus supplement without the prior written consent
of Piper Jaffray as the representative of the underwriters. The
lock-up
agreements do not prohibit our directors and executive officers
from transferring shares of our common stock for bona fide gifts
and other estate or tax planning purposes, subject to certain
requirements, including that the transferee be subject to the
same lock-up
terms, or from directing sales by a charitable foundation of up
to 25,000 shares of our common stock. The
lock-up
agreements do not prohibit us from issuing shares to our
directors and executive officers upon the exercise or conversion
of securities outstanding on the date of this prospectus
supplement. The
lock-up
provisions do not prevent us from selling shares to the
underwriters pursuant to the underwriting agreement, from
granting options or other stock-based awards to acquire
securities under our existing stock incentive plans or issuing
shares upon the exercise or conversion of securities outstanding
on the date of this prospectus supplement, or from issuing
shares of our common stock as consideration for the acquisition
of another entity or in connection with a license, joint venture
or similar arrangement.
The 90-day
lock-up
period in all of the
lock-up
agreements is subject to extension if (i) during the last
17 days of the
lock-up
period we issue an earnings release or material news or a
material event relating to us occurs or (ii) prior to the
expiration of the
lock-up
period, we announce that we will release earnings results during
the 16-day
period beginning on the last day of the
lock-up
period, in which case the restrictions imposed in these
lock-up
agreements shall continue to apply until the expiration of the
18-day
period beginning on the issuance of the earnings release or the
occurrence of the material news or material event, unless Piper
Jaffray waives the extension in writing.
Our shares are listed on the Nasdaq Global Select Market under
the symbol GIII.
To facilitate the offering, the underwriters may engage in
transactions that stabilize, maintain or otherwise affect the
price of the common stock during and after the offering.
Specifically, the underwriters may over-allot or otherwise
create a short position in the common stock for their own
accounts by selling more shares of common stock than we have
sold to them. Short sales involve the sale by the underwriters
of a greater number of shares than they are required to purchase
in the offering. The underwriters may close out any short
position by either exercising their option to purchase
additional shares or purchasing shares in the open market.
In addition, the underwriters may stabilize or maintain the
price of the common stock by bidding for or purchasing shares of
common stock in the open market and may impose penalty bids. If
penalty bids are imposed, selling concessions allowed to
syndicate members or other broker-dealers participating in the
offering are reclaimed if shares of common stock previously
distributed in the offering are repurchased, whether in
connection with stabilization transactions or otherwise. The
effect of these transactions may be to stabilize or maintain the
market price of the common stock at a level above that which
might otherwise prevail in the open market. The imposition of a
penalty bid may also affect the price of the common stock to the
extent that it discourages resales of the common stock. The
magnitude or effect of any stabilization or other transactions
is uncertain. These transactions may be effected on the Nasdaq
Global Select Market or otherwise and, if commenced, may be
discontinued at any time. The underwriters may also engage in
passive market making transactions in our common stock.
S-17
Passive market making consists of displaying bids on the Nasdaq
Global Select Market limited by the prices of independent market
makers and effecting purchases limited by those prices in
response to order flow. Rule 103 of Regulation M
promulgated by the SEC limits the amount of net purchases that
each passive market maker may make and the displayed size of
each bid. Passive market making may stabilize the market price
of the common stock at a level above that which might otherwise
prevail in the open market and, if commenced, may be
discontinued at any time.
This prospectus supplement and the accompanying prospectus in
electronic format may be made available on the web sites
maintained by the underwriters and the underwriters may
distribute prospectuses and prospectus supplements
electronically.
From time to time in the ordinary course of their respective
businesses, the underwriters and certain of their respective
affiliates have engaged, and may in the future engage, in
commercial banking or investment banking transactions with us
and our affiliates.
S-18
LEGAL
MATTERS
The validity of the issuance of the common stock offered by us
in this offering will be passed upon for us by
Fulbright & Jaworski L.L.P., New York, New York.
Certain legal matters will be passed upon for the underwriters
by Goodwin Procter LLP, New York, New York.
EXPERTS
The consolidated financial statements of G-III Apparel Group,
Ltd. and subsidiaries appearing in G-III Apparel Group
Ltd.s Annual Report
(Form 10-K)
for the year ended January 31, 2009 (including the schedule
appearing therein), and the effectiveness of G-III Apparel Group
Ltd.s internal control over financial reporting as of
January 31, 2009, have been audited by Ernst &
Young LLP, independent registered public accounting firm, as set
forth in their reports thereon included therein, and
incorporated herein by reference. Such consolidated financial
statements are incorporated herein by reference in reliance upon
such reports given on the authority of such firm as experts in
accounting and auditing.
WHERE YOU
CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements
and other information with the SEC. You may read and copy any
document we file at the SECs Public Reference Room at
100 F Street, N.E., Washington, D.C. 20549.
Please call the SEC at
1-800-SEC-0330
for more information about the operation of the public reference
room. The SEC maintains an Internet site that contains reports,
proxy and information statements, and other information
regarding issuers that file electronically with the SEC,
including G-III Apparel Group, Ltd. The SECs Internet site
can be found at
http://www.sec.gov.
INCORPORATION
BY REFERENCE
The SEC allows us to incorporate by reference
information that we file with it into our registration statement
on
Form S-3
of which this prospectus supplement and the accompanying
prospectus are a part, which means that we can disclose
important information to you by referring you to those
documents. The information incorporated by reference is an
important part of this prospectus supplement and the
accompanying prospectus. Information contained in this
prospectus supplement modifies, supersedes and replaces
information incorporated by reference into this prospectus
supplement that we filed with the SEC prior to the date of this
prospectus supplement, while information that we file later with
the SEC and deemed to be incorporated by reference into this
prospectus supplement will automatically update and supersede
the information contained in this prospectus supplement. We
incorporate by reference into the registration statement and
this prospectus supplement the documents listed below, and any
future filings we make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this
prospectus supplement (other than Current Reports or portions
thereof furnished under Item 2.02 or Item 7.01 of
Form 8-K):
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Our Annual Report on
Form 10-K,
for the fiscal year ended January 31, 2009, filed with the
SEC on April 16, 2009;
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Our Quarterly Report on
Form 10-Q
for the quarterly period ended April 30, 2009, filed with
the SEC on June 9, 2009;
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Our Quarterly Report on
Form 10-Q
for the quarterly period ended July 31, 2009, filed with
the SEC on September 8, 2009;
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|
Our Quarterly Report on
Form 10-Q
for the quarterly period ended October 31, 2009, filed with
the SEC on December 4, 2009; and
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Our Current Reports on
Form 8-K
filed with the SEC on February 3, 2009, April 7, 2009,
April 21, 2009, July 23, 2009 and September 16,
2009.
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S-19
You may obtain a copy of all of the documents that have been
incorporated by reference in this prospectus supplement,
including exhibits to these documents, without charge by
requesting them from us. If you would like to request documents
from us, please send a request in writing or by telephone at the
following address or telephone number:
G-III Apparel Group, Ltd.
512 Seventh Avenue
New York, NY 10018
Attn: Chief Financial Officer
Tel:
(212) 403-0500
Any statement contained in a document incorporated or deemed to
be incorporated by reference in this prospectus supplement will
be deemed modified, superseded or replaced for purposes of this
prospectus supplement to the extent that a statement contained
in this prospectus supplement or in any subsequently filed
document that also is or is deemed to be incorporated by
reference in this prospectus supplement modifies, supersedes or
replaces such statement. Any statement so modified, superseded
or replaced, will not be deemed, except as so modified,
superseded or replaced, to constitute a part of this prospectus
supplement.
S-20
PROSPECTUS
$300,000,000
Common Stock
Preferred Stock
Debt Securities
Warrants
Rights
This prospectus relates to common stock, preferred stock, debt
securities, warrants and rights that we may offer and sell from
time to time in one or more offerings up to a total dollar
amount of $300,000,000 on terms to be determined at the time of
sale. The debt securities, preferred stock and warrants may be
convertible, exercisable or exchangeable for common or preferred
stock or other securities of ours. We will provide specific
terms of these securities in supplements to this prospectus. You
should read this prospectus and any supplement carefully before
you invest. This prospectus may not be used to offer and sell
securities unless accompanied by a prospectus supplement for
those securities.
Our common stock is traded on the Nasdaq Global Select Market
under the symbol GIII.
These securities may be sold directly, on a continuous or
delayed basis, by us, through dealers or agents designated from
time to time, to or through underwriters or through a
combination of these methods. See Plan of
Distribution in this prospectus. We may also describe the
plan of distribution for any particular offering of these
securities in any applicable prospectus supplement. If any
agents, underwriters or dealers are involved in the sale of any
securities in respect of which this prospectus is being
delivered, we will disclose their names and the nature of our
arrangements with them in a prospectus supplement. The net
proceeds we expect to receive from any such sale will also be
included in a prospectus supplement.
Investing in our securities involves a high degree of risk.
You should carefully consider the Risk Factors
referred to on page 3 of this prospectus, in any applicable
prospectus supplement and the documents incorporated or deemed
incorporated by reference in this prospectus before investing in
our securities.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the adequacy or accuracy of this
prospectus. Any representation to the contrary is a criminal
offense.
The date of this prospectus is November 2, 2009
TABLE OF
CONTENTS
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Page
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3
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3
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3
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4
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5
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5
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5
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5
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6
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9
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14
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15
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15
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17
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17
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18
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18
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IMPORTANT
NOTICE ABOUT THE INFORMATION
PRESENTED IN THIS PROSPECTUS
You should rely only on the information contained or
incorporated by reference in this prospectus or any applicable
prospectus supplement. We have not authorized any other person
to provide you with different information. If anyone provides
you with different or inconsistent information, you should not
rely on it. For further information, see the section of this
prospectus entitled Where You Can Find More
Information. We are not making an offer to sell these
securities in any jurisdiction where the offer or sale is not
permitted.
You should not assume that the information appearing in this
prospectus or any applicable prospectus supplement is accurate
as of any date other than the date on the front cover of this
prospectus or the applicable prospectus supplement, or that the
information contained in any document incorporated by reference
is accurate as of any date other than the date of the document
incorporated by reference, regardless of the time of delivery of
this prospectus or any prospectus supplement or any sale of a
security. Our business, financial condition, results of
operations and prospects may have changed since such dates.
2
ABOUT
THIS PROSPECTUS
This prospectus is part of a registration statement on
Form S-3
that we filed with the Securities and Exchange Commission, or
the SEC, using a shelf registration process. Under
this shelf registration process, we may sell any combination of
the securities described in this prospectus in one or more
offerings up to a total dollar amount of $300,000,000. This
prospectus provides you with a general description of the
securities we may offer. Each time we sell securities, we will
provide a prospectus supplement that will contain specific
information about the securities being offered and the terms of
that offering. The prospectus supplement may also add to, update
or change information contained in this prospectus. You should
read both this prospectus and any prospectus supplement together
with the additional information described under the heading
Where You Can Find More Information carefully before
making an investment decision.
The rules of the SEC allow us to incorporate by reference
information into this prospectus. This means that important
information is contained in other documents that are considered
to be a part of this prospectus. Additionally, information that
we file later with the SEC will automatically update and
supersede this information. You should read this prospectus, any
prospectus supplement and the information that is incorporated
or deemed incorporated by reference in this prospectus. See
Incorporation by Reference. The registration
statement, including the exhibits and the documents incorporated
or deemed incorporated in this prospectus can be read on the SEC
website or at the SEC offices mentioned under the heading
Where You Can Find Additional Information.
This prospectus may not be used to sell any securities unless
accompanied by a prospectus supplement.
In this prospectus, G-III, we,
us, and our refer to G-III Apparel
Group, Ltd., a Delaware corporation, together with its
subsidiaries. References to fiscal years refer to the year ended
or ending on January 31 of that year. For example, our fiscal
year ended January 31, 2009 is referred to as fiscal
2009.
ABOUT
G-III APPAREL GROUP, LTD.
G-III is a leading manufacturer and distributor of outerwear,
dresses, sportswear and womens suits under licensed
brands, our own brands and private label brands. G-III has
fashion licenses under the Calvin Klein, Sean John, Kenneth
Cole, Cole Haan, Guess?, Jones New York, Jessica Simpson, Nine
West, Ellen Tracy, Tommy Hilfiger, Enyce, Levis and
Dockers brands and sports licenses with the National Football
League, National Basketball Association, Major League Baseball,
National Hockey League, Touch by Alyssa Milano and more than 100
U.S. colleges and universities. G-III sells outerwear and
handbags under our own Andrew Marc and Marc New York brands
and has licensed these brands for womens footwear,
mens accessories, womens handbags and mens
cold weather accessories. Our other owned brands include
Marvin Richards,
G-III,
Jessica Howard, Eliza J., Black Rivet, Siena Studio, Tannery
West, G-III by Carl Banks and Winlit.
G-III works
with a diversified group of retailers in developing product
lines to be sold under their proprietary private labels. G-III
also operates 121 retail stores, of which 118 are outlet stores
operated under the Wilsons Leather name.
We are a Delaware corporation that was formed in 1989. We and
our predecessors have conducted our business since 1974. Our
executive offices are located at 512 Seventh Avenue, New York,
New York 10018 and our telephone number is
(212) 403-0500.
Our website is
http://www.g-iii.com.
The information on our website is not part of this prospectus.
RISK
FACTORS
Investing in our securities involves significant risks. Please
see the risk factors under the heading Risk Factors
in our most recent Annual Report on
Form 10-K
for the year ended January 31, 2009, which is on file with
the SEC and is incorporated by reference in this prospectus, and
in the documents and reports that we file with the SEC after the
date of this prospectus that are incorporated by reference into
this prospectus, as well as any risks described in any
applicable prospectus supplement. Before making an investment
decision,
3
you should carefully consider these risks as well as other
information we include or incorporate by reference in this
prospectus and any prospectus supplement. The risks and
uncertainties we have described are not the only ones facing our
company. Additional risks and uncertainties not presently known
to us or that we currently deem immaterial may also affect our
business operations.
FORWARD-LOOKING
STATEMENTS
Statements in this prospectus (including the documents
incorporated by reference) concerning our business outlook or
future economic performance, anticipated revenues, expenses or
other financial items, product introductions and plans and
objectives related thereto, and statements concerning
assumptions made or expectations as to any future events,
conditions, performance or other matters, are
forward-looking statements as that term is defined
under the Federal securities laws. Forward-looking statements
are subject to risks, uncertainties and other factors which
could cause actual results to differ materially from those
stated in such statements. Such risks, uncertainties and factors
include, but are not limited to:
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dependence on licensed product;
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reliance on foreign manufacturers;
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risks of doing business abroad;
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the current economic and credit crisis;
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the nature of the apparel industry, including changing consumer
demand and tastes;
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seasonality;
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risks of operating a retail business;
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customer acceptance of new products;
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the impact of competitive products and pricing;
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dependence on existing management;
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possible disruption as a result of acquisitions;
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general economic conditions; and
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other risks detailed in our filings with the SEC.
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We cannot guarantee that we actually will achieve the plans,
intentions or expectations disclosed in our forward-looking
statements and you should not place undue reliance on our
forward-looking statements. There are a number of important
factors that could cause our actual results to differ materially
from those indicated by these forward-looking statements. These
important factors include the factors that we identify in the
documents we incorporate by reference in this prospectus, as
well as other information we include or incorporate by reference
in this prospectus and any prospectus supplement. See Risk
Factors. You should read these factors and other
cautionary statements made in this prospectus and any
accompanying prospectus supplement, and in the documents we
incorporate by reference, as being applicable to all related
forward-looking statements wherever they appear in the
prospectus and any accompanying prospectus supplement, and in
the documents incorporated by reference. We do not assume any
obligation to update any forward-looking statements made by us,
except as required by law.
4
RATIOS OF
EARNINGS TO FIXED CHARGES
AND RATIOS OF EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth the ratio of earnings to fixed
charges for each of the last five fiscal years and for the six
months ended July 31, 2009. In calculating these ratios,
earnings include pre-tax income or loss from continuing
operations plus fixed charges. Fixed charges include interest
expensed and estimated interest within rental expense. We have
never issued shares of preferred stock and, accordingly, have
not paid any dividends on shares of preferred stock during the
periods indicated, therefore the ratio of earnings to fixed
charges and preferred stock dividends are identical to the
ratios presented below for all such periods.
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Six Months
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Fiscal Year Ended
January 31,
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Ended
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2005
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2006
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2007
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2008
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2009
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July 31, 2009
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Ratio of Earnings to Fixed Charges
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1.9
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3.1
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3.5
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6.0
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(1
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(1
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Earnings were insufficient to cover fixed charges by
$9.4 million for the year ended January 31, 2009 and
$16.5 million for the six month period ended July 31,
2009. Pre-tax loss for the year ended January 31, 2009
includes non-cash impairment charges of $33.5 million. |
DIVIDEND
POLICY
We have never declared or paid cash dividends on our common
stock. We currently intend to retain all available funds and any
future earnings for use in the operation of our business and do
not anticipate paying any cash dividends in the foreseeable
future. Any future determination to declare cash dividends will
be made at the discretion of our board of directors, subject to
compliance with covenants under any existing financing
agreements, which may restrict or limit our ability to declare
or pay dividends, and will depend on our financial condition,
results of operations, capital requirements, general business
conditions, and other factors that our board of directors may
deem relevant. We issued a stock dividend in connection with our
3-for-2
stock split, which was effected in the form of a common stock
dividend effective on March 28, 2006.
USE OF
PROCEEDS
We currently intend to use the estimated net proceeds from the
sale of these securities for working capital and other general
corporate purposes. Working capital and other general corporate
purposes may include repaying debt, making capital expenditures,
funding general and administrative expenses and any other
purpose that we may specify in any prospectus supplement. We
have not yet determined the amount of net proceeds to be used
specifically for any of the foregoing purposes. Accordingly, our
management will have significant discretion and flexibility in
applying the net proceeds from the sale of securities sold
pursuant to this prospectus and the applicable prospectus
supplement. Pending any use, as described above, we intend to
invest the net proceeds in high-quality, short-term,
interest-bearing securities. Our plans to use the estimated net
proceeds from the sale of these securities may change, and if
they do, we will update this information in a prospectus
supplement.
THE
SECURITIES WE MAY OFFER
The descriptions of the securities contained in this prospectus,
together with the applicable prospectus supplements, summarize
the material terms and provisions of the various types of
securities that we may offer. We will describe in the applicable
prospectus supplement relating to any securities the particular
terms of the securities offered by that prospectus supplement.
If we so indicate in the applicable prospectus supplement, the
terms of the securities may differ from the terms we have
summarized below. We will also include in the prospectus
supplement information, where applicable, about material United
States federal income tax considerations relating to the
securities, and the securities exchange, if any, on which the
securities will be listed.
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We may sell from time to time, in one or more offerings:
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common stock;
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preferred stock;
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debt securities;
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warrants to purchase common stock, preferred stock or debt
securities; or
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rights to purchase common stock, preferred stock or warrants.
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In this prospectus, we refer to the common stock, preferred
stock, debt securities, warrants and rights collectively as
securities. The total dollar amount of all
securities that we may issue will not exceed $300,000,000.
This prospectus may not be used to consummate a sale of
securities unless it is accompanied by a prospectus supplement.
DESCRIPTION
OF CAPITAL STOCK
Authorized
Capital Stock
Our certificate of incorporation authorizes the issuance of
41,000,000 shares of all classes of stock, consisting of
40,000,000 shares of common stock, $.01 par value per
share, and 1,000,000 shares of preferred stock,
$.01 par value per share. The preferred stock may be issued
in one or more series with such terms as the board of directors
may determine. On March 28, 2006, we effected a
three-for-two
stock split of our common stock, which was effected in the form
of a stock dividend. As of October 22, 2009, we had
16,862,069 shares of outstanding common stock held by 47
holders of record.
We do not have any shares of preferred stock outstanding.
Common
Stock
Holders of our common stock are entitled to one vote for each
share held by them on all matters on which stockholders are
entitled to vote, including the election of directors, and do
not have cumulative voting rights. Subject to any preferential
rights of any then outstanding preferred stock, holders of our
common stock are entitled to receive, as, when and if declared
by our board of directors from time to time, such dividends and
other distributions in cash, stock or property from our assets
or funds legally available for such purposes. In the event of
any distribution of capital assets or
winding-up
of our company, whether voluntary or involuntary, holders of our
common stock are entitled to receive pro rata the assets
remaining after creditors have been paid in full. There are no
preemptive, subscription or conversion rights applicable to our
common stock. The outstanding shares of our common stock are
duly authorized, validly issued, and fully paid.
Preferred
Stock
Our board of directors has the authority, without stockholder
approval, to issue up to 1,000,000 shares of preferred
stock in one or more series. Our board also has the authority to
fix the designations, powers, preferences, privileges and
relative, participating, optional or special rights and the
qualifications, limitations or restrictions of any series of
preferred stock issued, including dividend rights, conversion
rights, voting rights, or other rights, any or all of which may
be greater than the rights of the common stock. Preferred stock
could be issued with terms that could delay or prevent a change
in control of our company or make removal of management more
difficult. In addition, the issuance of preferred stock may
decrease the market price of the common stock and may adversely
affect the voting and other rights of the holders of common
stock.
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If we decide to issue any preferred stock pursuant to this
prospectus, we will describe in a prospectus supplement the
terms of the preferred stock, including, if applicable, the
following:
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the title of the series and stated value;
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the number of shares of the series of preferred stock offered,
the liquidation preference per share, if applicable, and the
offering price;
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the applicable dividend rate(s) or amount(s), period(s) and
payment date(s) or method(s) of calculation thereof;
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the date from which dividends on the preferred stock will
accumulate, if applicable;
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any procedures for auction and remarketing;
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any provisions for a sinking fund;
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any applicable provision for redemption and the price or prices,
terms and conditions on which preferred stock may be redeemed;
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any securities exchange listing;
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any voting rights and powers;
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the terms and conditions, if applicable, of conversion into
shares of our common stock, including the conversion price or
rate or manner of calculation thereof;
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a discussion of any material U.S. federal income tax
considerations;
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the relative ranking and preference as to dividend rights and
rights upon our liquidation, dissolution or the winding up of
our affairs;
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any limitations on issuance of any series of preferred stock
ranking senior to or on a parity with such series of preferred
stock as to dividend rights and rights upon our liquidation,
dissolution or the winding up of our affairs; and
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any other specific terms, preferences, rights, limitations or
restrictions of such series of preferred stock.
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Anti-Takeover
Effects Of Certain Provisions Of Our Certificate Of
Incorporation
Our certificate of incorporation contains provisions that could
make it more difficult to acquire control of our company. A
description of these provisions is set forth below.
Authorized but Unissued Shares of Common Stock and Preferred
Stock. The authorized but unissued shares of
common stock and preferred stock are available for future
issuance without stockholder approval, unless such approval is
required by applicable law or the rules of any stock exchange on
which our securities may be listed. These additional shares may
be utilized for a variety of corporate purposes, including
future public offerings to raise additional capital, corporate
acquisitions and employee benefit plans. The existence of
authorized but unissued shares of common stock and preferred
stock could impede the completion of a merger, tender offer or
other takeover attempt that some, or a majority, of the
stockholders might believe to be in their best interests or in
which stockholders might receive a premium for their stock over
the then prevailing market price of the stock.
Special Stockholder Meetings. Our bylaws
provide that special meetings of the stockholders for any
purpose or purposes, unless required by law, may be called by
the president or secretary and shall be called by the chairman,
president or secretary at the request in writing of a majority
of the board of directors, or at the request in writing of
stockholders owning a majority in amount of our entire capital
stock issued and outstanding and entitled to vote.
Advanced Notice Procedure. Our bylaws provide
an advance notice procedure for special stockholder meetings.
Written notice of a special meeting stating the place, date and
hour of the meeting and the purpose or purposes for which the
meeting is called must be given not less than ten nor more than
sixty days before
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the date of the meeting, to each stockholder entitled to vote at
such meeting. These advance notice provisions may have the
effect of precluding the conduct of certain business at a
meeting if the proper procedures are not followed or may
discourage or deter a potential acquirer from conducting a
solicitation of proxies to elect its own slate of directors or
otherwise attempt to obtain control of us.
Anti-Takeover
Provisions Of Delaware Law
A number of provisions under Delaware law may make it more
difficult to acquire control of us. These provisions could
deprive the stockholders of opportunities to realize a premium
on the shares of common stock owned by them. In addition, these
provisions may adversely affect the prevailing market price of
the common stock. These provisions are intended to:
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enhance the likelihood of continuity and stability in the
composition of the board and in the policies formulated by the
board;
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discourage certain types of transactions which may involve an
actual or threatened change in control of our company;
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discourage certain tactics that may be used in proxy
fights; and
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encourage persons seeking to acquire control of our company to
consult first with the board of directors to negotiate the terms
of any proposed business combination or offer.
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We are subject to the provisions of Section 203 of the
Delaware General Corporation Law, an anti-takeover law. Subject
to exceptions, the statute prohibits a publicly-held Delaware
corporation from engaging in a business combination
with an interested stockholder for a period of three
years after the date of the transaction in which the person
became an interested stockholder, unless:
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Prior to such date, the board of directors of the corporation
approved either the business combination or the transaction
which resulted in the stockholder becoming an interested
stockholder;
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Upon consummation of the transaction which resulted in the
stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced,
excluding for purposes of determining the number of shares
outstanding, those shares owned (1) by persons who are
directors and also officers and (2) by employee stock plans
in which employee participants do not have the right to
determine confidentially whether shares held subject to the plan
will be tendered in a tender or exchange offer; or
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On or after such date, the business combination is approved by
the board of directors and authorized at an annual or special
meeting of stockholders and not by written consent, by the
affirmative vote of at least
662/3%
of the outstanding voting stock which is not owned by the
interested stockholder.
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For purposes of Section 203, a business
combination includes a merger, asset sale or other
transaction resulting in a financial benefit to the interested
stockholder, with an interested stockholder being
defined as a person who, together with affiliates and
associates, owns, or within three years prior to the date of
determination whether the person is an interested
stockholder, did own, 15% or more of the
corporations voting stock.
Limitation
On Liability And Indemnification Matters
Our certificate of incorporation and bylaws provide for the
indemnification of our officers and directors to the fullest
extent permitted under Delaware law.
Transfer
Agent And Registrar
The transfer agent and registrar for our common stock is Wells
Fargo Bank, National Association.
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Nasdaq
Stock Market Listing
Our common stock is quoted on the Nasdaq Global Select Market
under the trading symbol GIII.
DESCRIPTION
OF DEBT SECURITIES
Please note that in this section entitled Description of
Debt Securities, references to holders mean
those who own our debt securities registered in their own names
on the books that we or the trustee maintain for this purpose,
and not those who own beneficial interests in debt securities
registered in street name or in debt securities issued in
book-entry form through one or more depositaries.
The following description summarizes the material provisions of
our debt securities. The debt securities are to be issued under
a senior debt securities indenture or subordinated debt
securities indenture to be entered into between us and a trustee
that we will select. The forms of these indentures have been
filed with the SEC as exhibits to the registration statement of
which this prospectus is a part. This description is not
complete and is subject to, and is qualified in its entirety by
reference to, the forms of indentures and the
Trust Indenture Act of 1939, as amended, which we refer to
as the Trust Indenture Act. The indentures will
be qualified under the Trust Indenture Act.
The particular terms of each series of debt securities that we
may offer from time to time will be established in or under a
resolution of our board of directors and set forth in an
officers certificate or a supplemental indenture, and in a
form of debt security with respect to that series. We will file
the applicable executed indenture, such officers
certificate or supplemental indenture and the form of debt
security with the SEC. The prospectus supplement with respect to
the series of debt securities we are offering will describe
these particular terms and will indicate the extent to which the
general terms described below may not apply to that series of
debt securities. Whenever particular defined terms of the
applicable form of indenture, as supplemented or amended from
time to time, are referred to in this prospectus or a prospectus
supplement, those defined terms are incorporated in this
prospectus or such prospectus supplement by reference.
General
Our debt securities will be our direct obligations, which may be
secured or unsecured, may be senior or subordinated and may be
convertible into shares of our common stock or preferred stock.
The indentures do not limit the amount of debt securities that
we may issue and permit us to issue debt securities from time to
time in different series, each of which may have different
terms. Debt securities issued under the indentures will be
issued as part of a series that has been established by us under
the indenture.
We expect that the prospectus supplement relating to the
particular series of debt securities we are offering will
include the following information concerning those debt
securities:
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the title of the series;
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the aggregate principal amount;
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the issue price or prices, expressed as a percentage of the
aggregate principal amount of the debt securities;
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any limit on the aggregate principal amount;
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the date or dates on which principal is payable;
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the interest rate or rates (which may be fixed or variable) or,
if applicable, the method used to determine such rate or rates;
the date or dates from which interest, if any, will be payable
and any regular record date for the interest payable;
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the place or places where principal and, if applicable, premium
and interest, is payable;
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the terms and conditions upon which we may, or the holders may
require us to, redeem or repurchase the debt securities;
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the denominations in which such debt securities may be issuable,
if other than denominations of $1,000 or any integral multiple
of that number;
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whether the debt securities are to be issuable in the form of
certificated debt securities or global debt securities;
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the portion of principal amount that will be payable upon
declaration of acceleration of the maturity date if other than
the principal amount of the debt securities;
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the currency of denomination;
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the designation of the currency, currencies or currency units in
which payment of principal and, if applicable, premium and
interest, will be made;
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if payments of principal and, if applicable, premium or
interest, on the debt securities are to be made in one or more
currencies or currency units other than the currency of
denomination, the manner in which the exchange rate with respect
to such payments will be determined;
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if amounts of principal and, if applicable, premium and interest
may be determined by reference to an index based on a currency
or currencies or by reference to a commodity, commodity index,
stock exchange index or financial index, then the manner in
which such amounts will be determined;
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the provisions, if any, relating to any collateral provided for
such debt securities;
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the provisions, if any, with respect to amortization;
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any addition to or change in the covenants
and/or the
acceleration provisions described in this prospectus or in the
indenture;
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any events of default, if not otherwise described below under
Events of Default, Notice and Waiver;
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the terms and conditions, if any, for conversion into or
exchange for shares of common stock or preferred stock;
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any terms and conditions restricting the declaration of
dividends or requiring the maintenance of any asset ratio or the
creation or maintenance of reserves;
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any provisions restricting the incurrence of additional debt or
the issuance of additional securities;
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any depositaries, interest rate calculation agents, exchange
rate calculation agents or other agents;
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the terms and conditions, if any, upon which the debt securities
shall be subordinated in right of payment to our other
indebtedness;
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whether the debt security will be defeasible; and
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any other terms of the debt securities.
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Conversion
Rights
The terms, if any, on which debt securities of a series may be
exchanged for or converted into common stock or preferred stock,
debt securities of another series or other securities will be
set forth in the prospectus supplement relating to the series.
Global
Debt Securities
Unless we specify otherwise in the applicable prospectus
supplement, the registered debt securities of a series will be
issued only in the form of one or more fully registered global
securities that will be deposited with a depositary or with a
nominee for a depositary identified in the prospectus supplement
relating to the series and registered in the name of the
depositary or a nominee of the depository. Ownership of
beneficial
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interests in a registered global security will be limited to
persons, or participants, that have accounts with the depositary
for the registered global security or persons that may hold
interests through participants.
Those who own beneficial interests in a global debt security
will do so through participants in the depositarys
securities clearance system, and the rights of those indirect
owners will be governed solely by the applicable procedures of
the depositary and its participants.
Payments
on Debt Securities
We will make payments on our debt securities at the office or
agency we will maintain for that purpose, which will be the
Corporate Trust Office of the trustee in New York, New York
unless we indicate otherwise in the prospectus supplement, or at
such other places and at the respective times and in the manner
as we designate in the prospectus supplement.
Subordination
of Subordinated Debt Securities
Any debt securities issued under our subordinated indenture will
be subordinate and junior in right of payment to all of our
other indebtedness, except any of our indebtedness the terms of
which expressly provide that repayment of that indebtedness is
subordinate and junior in right of payment to the debt
securities issued under our subordinated indenture. The
indentures in the forms initially filed as exhibits to the
registration statement of which this prospectus is a part do not
limit the amount of indebtedness which we may incur, including
senior indebtedness or subordinated indebtedness, and do not
limit us from issuing any other debt.
As of October 22, 2009, our outstanding indebtedness
consisted of $187.0 million outstanding under a financing
agreement with JPMorgan Chase Bank N.A., as administrative agent
for a consortium of banks. The financing agreement is a senior
secured revolving credit facility providing for borrowings in
the aggregate principal amount of up to $250 million. We
will update the amount of our debt outstanding which is senior,
equal in rank and subordinated to any series of indebtedness
that we issue under our senior indenture or subordinated
indenture in the prospectus supplement relating to any offering
of debt securities.
Covenants
Unless we otherwise specify in the prospectus supplement, there
are not any covenants in either the senior debt securities
indenture, the subordinated debt securities indenture or our
debt securities that would protect you against a highly
leveraged or other transaction involving us that may adversely
affect you as a holder of our debt securities. If there are
provisions that offer such protection, they will be described in
the prospectus supplement.
We may not consolidate or merge or sell or convey all or
substantially all of our assets unless the surviving person, if
it is not us, is a domestic person and assumes our obligations
under our debt securities and the indenture and unless, under
the indenture, there is no event of default (defined below)
immediately after the transaction.
Any additional covenants that we agree to with respect to a
series of the debt securities will be set forth in the
prospectus supplement or related pricing supplement.
Events of
Default, Notice and Waiver
An event of default in respect of any series of our debt
securities means:
(1) our failure to pay any interest on that series within
30 days of when that interest is due;
(2) our failure to pay any principal, sinking fund
installment or analogous obligation on that series when due;
(3) our failure to perform any other agreement in our debt
securities of that series or the indenture, other than an
agreement relating solely to another series of our debt
securities, for 90 days after written notice of the breach
or default;
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(4) acceleration of our indebtedness aggregating more than
$5,000,000;
(5) our failure to discharge any judgment of $5,000,000 or
more within 60 days after the judgment becomes final and
nonappealable; and
(6) certain events of our bankruptcy, insolvency and
reorganization.
If an event of default described in (1), (2) or
(3) above (if the event of default under (3) above is
with respect to less than all series of debt securities then
outstanding) occurs and is continuing, either the trustee or the
holders of 25% in principal amount of the outstanding debt
securities of a series may declare the principal and accrued
interest, if any, of all securities of that series to be due and
payable. If an event default described in (3) (if the event of
default under (3) above is with respect to all series of
securities then outstanding), (4) or (5) above occurs
and is continuing, either the trustee or the holders of 25% in
principal amount of the outstanding debt securities of all
series may declare the principal and accrued interest, if any,
of all the outstanding debt securities to be due and payable.
Within 90 days after a default in respect of any series of
our debt securities, the trustee must give to the holders of
such series notice of all uncured and unwaived defaults by us
known to it. However, except in the case of default in payment,
the trustee may withhold such notice if it in good faith
determines that withholding is in the interest of such holders.
The term default means, for this purpose, the
happening of any event of default, disregarding any grace period
or notice requirement.
Before the trustee is required to exercise rights under the
indenture at the request, order or direction of holders, it is
entitled to be indemnified by such holders, subject to its duty,
during an event of default, to act with the required standard of
care.
If any event of default has occurred, the holders of a majority
in principal amount of the outstanding debt securities of any
series (with each series voting as a separate class) may direct
the time, method and place of conducting proceedings for
remedies available to the trustee, or exercising any trust or
power conferred on the trustee, in respect of that series.
We must file an annual certificate with the trustee that we are
in compliance with conditions and covenants under the indenture.
The holders of a majority in principal amount of the outstanding
debt securities of a series, on behalf of the holders of all
debt securities of that series, or the holders of a majority of
all outstanding debt securities voting as a single class, on
behalf of the holders of all outstanding debt securities may
waive some past defaults or events of default, or compliance
with certain provisions of the indenture, but may not waive
among other things an uncured default in payment of interest or
principal.
Modification
or Amendment of the Indenture
If we receive the consent of the holders of a majority in
principal amount of the outstanding debt securities affected, we
may enter into supplemental indentures with the trustee that
would:
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add, change or eliminate provisions in the applicable
indenture; or
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change the rights of the holders of our debt securities.
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However, unless we receive the consent of all of the affected
holders, we may not enter into supplemental indentures that
would, with respect to the debt securities of those holders:
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change the final maturity;
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reduce the principal amount or any premium;
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reduce the interest rate or extend the time of payment of
interest;
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in the case of subordinated debt securities, modifying the
subordination provisions in a manner that is adverse to holders
of the subordinated debt securities;
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in the case of senior debt securities, modifying the securities
to subordinate the securities to other indebtedness;
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reduce any amount payable on redemption or provable in
bankruptcy;
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reduce the amount of the principal of an original issue discount
security that would be payable on acceleration;
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impair or affect the right of any holder to institute suit for
payment;
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change any right of the holder to require repayment; or
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reduce the requirement for majority approval of supplemental
indentures.
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Satisfaction
and Discharge of Indenture
The applicable indenture, with respect to any and all series of
debt securities (except for certain specified surviving
obligations including, among other things, our obligation to pay
the principal of or interest, if any, on any debt securities),
will be discharged and cancelled upon the satisfaction of
certain conditions, including the payment in full of the
principal of, and interest, if any, on all of the debt
securities of that series or the deposit with the trustee of an
amount of cash sufficient for the payment or redemption, in
accordance with the indenture.
Defeasance
The indentures include provisions allowing defeasance that we
may choose to apply to our debt securities of any series. If we
do so, we must deposit with the trustee or another trustee money
or U.S. government obligations (or combination thereof)
sufficient to make all payments on those debt securities. If we
make such a deposit with respect to your debt securities, we may
elect:
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to be discharged from all our obligations on your debt
securities, except for our obligations to register transfers and
exchanges, to replace temporary or mutilated, destroyed, lost or
stolen debt securities, to maintain an office or agency in
respect of the debt securities and to hold moneys for payment in
trust (defeasance); or
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to be released from covenants with respect to your debt
securities that we may specify in accordance with the indenture
(covenant defeasance).
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In order to exercise defeasance, we must deliver to the trustee
an opinion of our counsel stating that we have received, or that
there has been a publication of, an Internal Revenue Service
ruling, or that there has been a change in applicable
U.S. federal income tax law, and that as a result of such
ruling or change in law, the holders of our debt securities will
not recognize income, gain or loss for U.S. federal income
tax purposes as a result of such defeasance and will be subject
to U.S. federal income tax on the same amounts, in the same
manner and at the same time as would have been the case if such
defeasance had not occurred. In order to exercise covenant
defeasance, we must deliver to the trustee an opinion of our
counsel stating that the holders of our debt securities will not
recognize income, gain or loss for U.S. federal income tax
purposes as a result of such covenant defeasance and will be
subject to U.S. federal income tax in the same amounts, in
the same manner and at the same time as would have been the case
if such covenant defeasance had not occurred. There are
additional conditions to defeasance or covenant defeasance which
are described in the applicable indenture.
Governing
Law and Consent to Jurisdiction
The indentures and the debt securities issued thereunder will be
governed by and construed in accordance with the laws of the
State of New York without regard to conflicts of laws.
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Concerning
the Trustee
The indentures contain limitations on the rights of the trustee
should it become a creditor of G-III, to obtain payment of
claims in certain cases, or to realize on certain property
received in respect of any such claim, as security or otherwise.
The trustee will be permitted to engage in other transactions
with us. However, if the trustee acquires any conflicting
interest it must eliminate such conflict or resign or otherwise
comply with the Trust Indenture Act.
The indentures provide that, in case an event of default should
occur and be continuing, the trustee will be required to use the
degree of care and skill of a prudent person in the conduct of
his or her own affairs in the exercise of its powers.
DESCRIPTION
OF WARRANTS
We may issue warrants for the purchase of common stock,
preferred stock or debt securities. Warrants may be issued
independently or together with common stock, preferred stock,
debt securities or rights, and the warrants may be attached to
or separate from such securities. We may issue warrants directly
or under a warrant agreement to be entered into between us and a
warrant agent. We will name any warrant agent in the applicable
prospectus supplement. Any warrant agent will act solely as our
agent in connection with the warrants of a particular series and
will not assume any obligation or relationship of agency or
trust for or with any holders or beneficial owners of warrants.
The following is a description of the general terms and
provisions of any warrants we may issue and may not contain all
the information that is important to you. You can access
complete information by referring to the applicable prospectus
supplement. In the applicable prospectus supplement, we will
describe the terms of the warrants and any applicable warrant
agreement, including, where applicable, the following:
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the offering price and aggregate number of warrants offered;
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the designation and terms of the securities with which the
warrants are issued and the number of warrants issued with each
such security;
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the date on and after which the warrants and the related
securities will be separately transferable;
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the number of shares of common stock or preferred stock or
principal amounts of debt securities, as the case may be,
purchasable upon the exercise of one warrant and the price at
which these securities may be purchased upon such exercise;
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the effect of any merger, consolidation, sale or other
disposition of our business on the warrant agreement and the
warrants;
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the terms of any rights to redeem or call the warrants;
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any provisions for changes to or adjustments in the exercise
price or number of securities issuable upon exercise of the
warrants;
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the dates on which the right to exercise the warrants will
commence and expire;
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the manner in which the warrant agreement and warrants may be
modified;
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a discussion of any material U.S. federal income tax
considerations of holding or exercising the warrants;
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the terms of the securities issuable upon exercise of the
warrants; and
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any other specific terms, preferences, rights or limitations of
or restrictions on the warrants.
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DESCRIPTION
OF RIGHTS
We may issue rights to purchase common stock, preferred stock or
warrants that we may offer to our securityholders. The rights
may or may not be transferable by the persons purchasing or
receiving the rights. In connection with any rights offering, we
may enter into a standby underwriting or other arrangement with
one or more underwriters or other persons pursuant to which such
underwriters or other persons would purchase any offered
securities remaining unsubscribed for after such rights
offering. Each series of rights will be issued under a separate
rights agent agreement to be entered into between us and a bank
or trust company, as rights agent, that we will name in the
applicable prospectus supplement. The rights agent will act
solely as our agent in connection with the rights and will not
assume any obligation or relationship of agency or trust for or
with any holders of rights certificates or beneficial owners of
rights.
The prospectus supplement relating to any rights that we offer
will include specific terms relating to the offering, including,
among other matters:
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the date of determining the security holders entitled to the
rights distribution;
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the aggregate number of rights issued and the aggregate number
of shares of common stock or preferred stock or warrants
purchasable upon exercise of the rights;
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the exercise price;
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the conditions to completion of the rights offering;
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the date on which the right to exercise the rights will commence
and the date on which the rights will expire; and
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any applicable federal income tax considerations.
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Each right would entitle the holder of the rights to purchase
for cash the amount of shares of common stock or preferred stock
or warrants at the exercise price set forth in the applicable
prospectus supplement. Rights may be exercised at any time up to
the close of business on the expiration date for the rights
provided in the applicable prospectus supplement. After the
close of business on the expiration date, all unexercised rights
will become void.
If less than all of the rights issued in any rights offering are
exercised, we may offer any unsubscribed securities directly to
persons other than our security holders, to or through agents,
underwriters or dealers or through a combination of such
methods, including pursuant to standby arrangements, as
described in the applicable prospectus supplement.
PLAN OF
DISTRIBUTION
We may sell the securities being offered hereby in one or more
of the following ways from time to time:
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through agents to the public or to investors;
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to one or more underwriters or dealers for resale to the public
or to investors;
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in at the market offerings, within the meaning of
Rule 415(a)(4) of the Securities Act of 1933, as amended,
to or through a market maker or into an existing trading market,
or an exchange or otherwise;
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directly to investors in privately negotiated
transactions; or
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through a combination of these methods of sale.
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The securities that we distribute by any of these methods may be
sold, in one or more transactions, at:
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a fixed price or prices, which may be changed;
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market prices prevailing at the time of sale;
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prices related to prevailing market prices; or
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negotiated prices.
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We will set forth in a prospectus supplement the terms of the
offering of our securities, which will include, if applicable:
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the name or names of any agents or underwriters;
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the purchase price of our securities being offered and the
proceeds we will receive from the sale;
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any over-allotment options under which underwriters may purchase
additional securities from us;
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any agency fees or underwriting discounts and commissions and
other items constituting agents or underwriters
compensation;
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the public offering price;
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any discounts or concessions allowed or reallowed or paid to
dealers; and
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any securities exchanges on which such common stock may be
listed.
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Underwriters
Underwriters, dealers and agents that participate in the
distribution of the securities may be underwriters as defined in
the Securities Act and any discounts or commissions they receive
from us and any profit on their resale of the securities may be
treated as underwriting discounts and commissions under the
Securities Act. We will identify in the applicable prospectus
supplement any underwriters, dealers or agents and will describe
their compensation. We may have agreements with the
underwriters, dealers and agents to indemnify them against
specified civil liabilities, including liabilities under the
Securities Act. Underwriters, dealers and agents may engage in
transactions with or perform services for us or our subsidiaries
in the ordinary course of their businesses.
If we use underwriters for a sale of securities, the
underwriters will acquire the securities for their own account.
The underwriters may resell the securities in one or more
transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the
time of sale. The obligations of the underwriters to purchase
the securities will be subject to the conditions set forth in
the applicable underwriting agreement. The underwriters will be
obligated to purchase all the securities offered if they
purchase any of the securities offered. We may change from time
to time any initial public offering price and any discounts or
concessions the underwriters allow or reallow or pay to dealers.
We may use underwriters with whom we have a material
relationship. We will describe in the prospectus supplement
naming the underwriters the nature of any such relationship.
Agents
We may designate agents who agree to use their reasonable
efforts to solicit purchases for the period of their appointment
or to sell securities on a continuing basis.
Direct
Sales
We may also sell securities directly to one or more purchasers
without using underwriters or agents.
Trading
Markets and Listing of Securities
Unless otherwise specified in the applicable prospectus
supplement, each class or series of securities will be a new
issue with no established trading market, other than our common
stock, which is traded on the Nasdaq Global Select Market. We
may elect to list any other class or series of securities on any
exchange, but we are not obligated to do so. It is possible that
one or more underwriters may make a market in a class or series
of securities, but the underwriters will not be obligated to do
so and may discontinue any market
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making at any time without notice. We cannot give any assurance
as to the liquidity of the trading market for any of the
securities.
Stabilization
Activities
In connection with an offering, an underwriter may purchase and
sell securities in the open market. These transactions may
include short sales, stabilizing transactions and purchases to
cover positions created by short sales. Shorts sales involve the
sale by the underwriters of a greater number of securities than
they are required to purchase in the offering.
Covered short sales are sales made in an amount not
greater than the underwriters option to purchase
additional securities from us, if any, in the offering. If the
underwriters have an over-allotment option to purchase
additional securities from us, the underwriters may close out
any covered short position by either exercising their
over-allotment option or purchasing securities in the open
market. In determining the source of securities to close out the
covered short position, the underwriters may consider, among
other things, the price of securities available for purchase in
the open market as compared to the price at which they may
purchase securities through the over-allotment option.
Naked short sales are any sales in excess of such
option or where the underwriters do not have an over-allotment
option. The underwriters must close out any naked short position
by purchasing securities in the open market. A naked short
position is more likely to be created if the underwriters are
concerned that there may be downward pressure on the price of
the securities in the open market after pricing that could
adversely affect investors who purchase in the offering.
Accordingly, to cover these short sales positions or to
otherwise stabilize or maintain the price of the securities, the
underwriters may bid for or purchase securities in the open
market and may impose penalty bids. If penalty bids are imposed,
selling concessions allowed to syndicate members or other
broker-dealers participating in the offering are reclaimed if
securities previously distributed in the offering are
repurchased, whether in connection with stabilization
transactions or otherwise. The effect of these transactions may
be to stabilize or maintain the market price of the securities
at a level above that which might otherwise prevail in the open
market. The impositions of a penalty bid may also effect the
price of the securities to the extent that it discourages resale
of the securities. The magnitude or effect of any stabilization
or other transactions is uncertain. These transactions may be
effected on the Nasdaq Global Select Market or otherwise and, if
commenced, may be discontinued at any time.
EXPERTS
The consolidated financial statements of G-III Apparel Group,
Ltd. and subsidiaries appearing in G-III Apparel Group
Ltd.s Annual Report
(Form 10-K)
for the year ended January 31, 2009 (including the schedule
appearing therein), and the effectiveness of G-III Apparel Group
Ltd.s internal control over financial reporting as of
January 31, 2009, have been audited by Ernst &
Young LLP, independent registered public accounting firm, as set
forth in their reports thereon included therein, and
incorporated herein by reference. Such financial statements are,
and audited financial statements to be included in subsequently
filed documents will be, incorporated herein in reliance upon
the reports of Ernst & Young LLP pertaining to such
financial statements and the effectiveness of our internal
control over financial reporting as of the respective dates (to
the extent covered by consents filed with the Securities and
Exchange Commission) given on the authority of such firm as
experts in accounting and auditing.
LEGAL
MATTERS
Certain legal matters, including the legality of the securities
offered, will be passed upon for us by our counsel,
Fulbright & Jaworski L.L.P., New York, New York. If
the securities are distributed in an underwritten offering,
certain legal matters will be passed upon for the underwriters
by counsel identified in the applicable prospectus supplement.
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WHERE YOU
CAN FIND MORE INFORMATION
We file reports, proxy statements and other documents with the
SEC. You may read and copy any document we file at the
SECs public reference room at 100 F Street,
N.E., Room 1580, Washington, DC 20549. You should call
1-800-SEC-0330
for more information on the operation of the public reference
room. Our SEC filings are also available to you on the
SECs Internet site at
http://www.sec.gov.
The SECs Internet site contains reports, proxy and
information statements, and other information regarding issuers
that file electronically with the SEC.
This prospectus is part of a registration statement that we
filed with the SEC. The registration statement contains more
information than this prospectus regarding us, including certain
exhibits and schedules. You can obtain a copy of the
registration statement from the SEC at the address listed above
or from the SECs Internet site.
Our Internet address is
http://www.g-iii.com.
The information on our Internet website is not incorporated by
reference in this prospectus.
INCORPORATION
OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate into this
prospectus information that we file with the SEC in other
documents. This means that we can disclose important information
to you by referring to other documents that contain that
information. Any information that we incorporate by reference is
considered part of this prospectus. The documents and reports
that we list below are incorporated by reference into this
prospectus. In addition, all documents and reports which we file
pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of this prospectus are incorporated
by reference in this prospectus as of the respective filing
dates of these documents and reports. Statements contained in
documents that we file with the SEC and that are incorporated by
reference in this prospectus will automatically update and
supersede information contained in this prospectus, including
information in previously filed documents or reports that have
been incorporated by reference in this prospectus, to the extent
the new information differs from or is inconsistent with the old
information.
We have filed the following documents with the SEC. These
documents are incorporated herein by reference as of their
respective dates of filing:
(1) our annual report on
Form 10-K,
for the fiscal year ended January 31, 2009, filed on
April 16, 2009;
(2) our quarterly report on
Form 10-Q
for the quarterly period ended April 30, 2009, filed on
June 9, 2009;
(3) our quarterly report on
Form 10-Q
for the quarterly period ended July 31, 2009, filed on
September 8, 2009;
(4) our current reports on
Form 8-K
filed on February 3, 2009, April 7, 2009,
April 21, 2009, July 23, 2009 and September 16,
2009; and
(5) the description of our capital stock contained in our
Form 8-K
filed on May 1, 2006.
All documents subsequently filed by us pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a post-effective
amendment that indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold,
will be deemed to be incorporated by reference in this
Registration Statement and to be part hereof from the date of
filing of such documents. Any statement contained in any
document incorporated or deemed to be incorporated by reference
herein will be deemed to be modified or superseded for purposes
of this Registration Statement to the extent that a statement
contained herein, or in any other subsequently filed document
which also is or is deemed to be incorporated by reference
herein, modifies or supersedes such statement.
Any such statement so modified or superseded will not be deemed,
except as modified or superseded, to constitute a part of this
Registration Statement.
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You may request a copy of these documents, which will be
provided to you at no cost, by contacting:
G-III
Apparel Group, Ltd.
512 Seventh Avenue
New York, New York 10018
Attention: Chief Financial Officer
(212) 403-0500
You should rely only on the information contained in this
prospectus, including information incorporated by reference as
described above, or any prospectus supplement that we have
specifically referred you to. We have not authorized anyone else
to provide you with different information. You should not assume
that the information in this prospectus or any prospectus
supplement is accurate as of any date other than the date on the
front of those documents or that any document incorporated by
reference is accurate as of any date other than its filing date.
You should not consider this prospectus to be an offer or
solicitation relating to the securities in any jurisdiction in
which such an offer or solicitation relating to the securities
is not authorized. Furthermore, you should not consider this
prospectus to be an offer or solicitation relating to the
securities if the person making the offer or solicitation is not
qualified to do so, or if it is unlawful for you to receive such
an offer or solicitation.
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1,700,000 Shares
Common Stock
PROSPECTUS SUPPLEMENT
Sole Book-Running
Manager
Piper Jaffray
Co-Lead Manager
Lazard Capital
Markets
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Brean
Murray, Carret & Co. |
KeyBanc Capital Markets |
December 16, 2009