SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as
permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-12
JLM Couture, Inc.
-----------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
JLM COUTURE, INC.
525 Seventh Avenue, Suite 1703
New York, NY 10018
Notice of 2005 Annual Meeting of Shareholders
to be held on [ ], 2005
To the Shareholders of
JLM COUTURE, INC.:
NOTICE IS HEREBY GIVEN that the 2005 Annual Meeting of
Shareholders (the "Meeting") of JLM COUTURE, INC. (the "Company")
will be held on [ ], 2005 at 11:00 A.M. at the
offices of Kalin Levine Weinberg LLC, located at 494 Eighth
Avenue, Suite 800, New York, NY 10001, to consider and vote on
the following matters described under the corresponding numbers
in the attached Proxy Statement:
1. To elect one Class I Director to hold office for three
years and until the 2008 Annual Meeting of Shareholders at which
his term expires or until his successor has been duly elected
and qualifies;
2. To ratify the appointment of Goldstein Golub Kessler
LLP as the Company's independent registered public accounting
firm for its fiscal year ending October 31, 2005; and
3. To transact such other business as may properly come
before the Meeting.
The Board of Directors has fixed [ ], 2005, at the
close of business, as the record date for the determination of
shareholders entitled to vote at the Meeting, and only holders of
shares of Common Stock of the Company of record at the close of
business on that day will be entitled to vote. The stock
transfer books of the Company will not be closed.
A complete list of shareholders entitled to vote at the
Meeting shall be available for examination by any shareholder,
for any purpose germane to the Meeting, during ordinary business
hours from [ ], 2005 until the Meeting at the offices of
the Company. The list will also be available at the Meeting.
Whether or not you expect to be present at the Meeting,
please fill in, date, sign, and return the enclosed Proxy, which
is solicited by management. The Proxy is revocable and will not
affect your vote in person in the event you attend the Meeting.
By Order of the Board
of Directors
Mark Murphy, Secretary
Date: [ ], 2005
Requests for additional copies of proxy material and the
Company's Annual Report for its fiscal year ended October 31,
2004 should be addressed to Shareholder Relations, JLM Couture,
Inc., 525 Seventh Avenue, Suite 1703, New York, NY 10018. This
material will be furnished without charge to any shareholder
requesting it.
JLM COUTURE, INC.
525 Seventh Avenue, Suite 1703
New York, NY 10018
PROXY STATEMENT FOR THE 2005 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON [ ], 2005
The enclosed proxy is solicited by the management of JLM
Couture, Inc. (the "Company") in connection with the 2005 Annual
Meeting of Shareholders (the "Meeting") to be held on [
], 2005 at 11:00 A.M. at the offices of Kalin Levine Weinberg
LLC, located at 494 Eighth Avenue, Suite 800, New York, NY 10001
and any adjournment thereof. The Board of Directors (the
"Board") has set [ ], 2005 as the record date for the
determination of shareholders entitled to vote at the Meeting. A
shareholder executing and returning a proxy has the power to
revoke it at any time before it is exercised by filing a later
proxy with, or other communication to, the Secretary of the
Company or by attending the Meeting and voting in person.
The proxy will be voted in accordance with your directions
as to:
(1) The election of one Class I Director to hold office for
three years and until the 2008 Annual Meeting of Shareholders at
which his term expires or until his successor has been duly
elected and qualifies;
(2) The ratification of the appointment of Goldstein Golub
Kessler LLP ("GGK") as the Company's independent registered
public accounting firm for its fiscal year ending October 31,
2005; and
(3) The transaction of such other business as may properly
come before the Meeting.
In the absence of direction, the proxy will be voted in
favor of management's proposals.
The entire cost of soliciting proxies will be borne by the
Company. The costs of solicitation, which represent an amount
believed to be normally expended for a solicitation relating to
an uncontested election of directors, will include the costs of
supplying necessary additional copies of the solicitation
materials and the Company's Annual Report to Shareholders for its
fiscal year ended October 31, 2004 ("Fiscal 2004")(the "Annual
Report") to beneficial owners of shares held of record by
brokers, dealers, banks, trustees, and their nominees, including
the reasonable expenses of such recordholders for completing the
mailing of such materials and Annual Reports to such beneficial
owners.
Only shareholders of record of the Company's 1,962,644
shares of Common Stock (the "Common Stock") outstanding at the
close of business on [ ], 2005 will be entitled to vote.
Each share of Common Stock is entitled to one vote. Holders of a
majority of the outstanding shares of Common Stock must be
represented in person or by proxy in order to achieve a quorum.
All shares of our Common Stock represented in person or by proxy
(including shares which abstain or do not vote for any reason
with respect to one or more of the matters presented for
stockholder approval) will be counted for purposes of determining
whether a quorum is present at the Annual Meeting. Abstentions
will be treated as shares that are present and entitled to vote
for purposes of determining the number of shares present and
entitled to vote with respect to any particular matter, but will
not be counted as a vote in favor of such matter. Accordingly,
an abstention from voting on a matter has the same legal effect
as a vote against the matter. If a broker or nominee holding
stock in "street name" indicates on the proxy that it does not
have discretionary authority to vote as to a particular matter
("broker non-votes"), those shares will not be considered as
present and entitled to vote with respect to such matter.
Accordingly, a broker non-vote on a matter has no effect on the
voting on such matter. The proxy statement, the attached notice
of meeting, the enclosed form of proxy and the Annual Report are
being mailed to shareholders on or about [ ], 2005. The
mailing address of the Company's principal executive offices is
525 Seventh Avenue, Suite 1703, New York, NY 10018.
PROPOSAL 1
ELECTION OF ONE CLASS I DIRECTOR
The Company's By-laws require the Company to have five or
fewer directors. The number of directors is set by the Board and
was increased from three to four on August 12, 2003. The Board
is divided into three classes of directors. Classes I and III
currently each consist of one director and Class II currently
consists of two directors. Class I, whose term expires at the
Meeting, consists of Joseph E. O'Grady; Class II, whose term
expires in 2006, consists of Daniel M. Sullivan and Keith Cannon;
and Class III, whose term expires in 2007 consists of Joseph L.
Murphy. At the Meeting, one director will be elected to fill the
term of the Class I director. Mr. O'Grady, who is running for
reelection, is the nominee for election at the Meeting. If
elected, Mr. O'Grady will serve for a term expiring at the 2008
Annual Meeting of Shareholders.
The persons named in the accompanying proxy have advised
management that it is their intention to vote for the election of
Mr. O'Grady as a Class I Director unless indication is made on
your proxy card that your vote should be withheld from the
nominee.
The Board of Directors unanimously recommends a vote FOR the
election of this nominee as a Director.
The following table sets forth certain information as to the
person nominated for election as a director of the Company and
for those directors whose terms of office will continue after the
Meeting:
Nominee For Director Whose Term Expires in 2008:
-----------------------------------------------
Position with Director
Name Age the Company Since
---- --- ------------- --------
Joseph L. Murphy 51 Chief Executive Officer, April 1986
Chief Financial Officer,
and Director
Joseph L. Murphy, a founder of the Company, has been a
director of the Company since its inception. During Fiscal 1992,
Mr. Murphy was appointed President. In February 1993, Mr. Murphy
was appointed Chief Executive Officer. Mr. Murphy is the brother
of Mark Murphy, the Company's Vice President-Operations and
Secretary.
Directors Whose Terms Continue After the Meeting:
------------------------------------------------
Position with Director
Name Age the Company Since
---- --- ------------- --------
Joseph E. O'Grady 84 Director February 1991
Daniel M. Sullivan 81 Chairman of the September 1986
Board of Directors
Keith Cannon 65 Director October 2003
Joseph E. O'Grady was elected to the Board of Directors in
February 1991. For more than the past five years, Mr. O'Grady has
been President of JOG Associates, Inc., a privately-held
financial consulting firm. JOG Associates, Inc. arranges
business financing and provides financial consulting services for
closely-held companies.
Daniel M. Sullivan became a director in September 1986 and
was elected Chairman of the Board in 1989. In 1989, Mr. Sullivan
retired as President and Chief Executive Officer of Frost &
Sullivan, Inc., a publicly-traded publisher of market research
studies, a position he had held for more than five years prior to
his retirement.
Keith A. Cannon became a director of the Company in October
2003. Mr. Cannon is currently (and for the past ten years has
been) a registered representative for Wilson-Davis & Co., Inc., a
broker-dealer based in Salt Lake City, Utah. Mr. Cannon also
serves as a member of the Board of Directors and Audit Committee
of Elamex S.A. de C.V. (ELAM), and Montgomery Realty Group, Inc.
(MGRY). He has been engaged in the investment business for the
past 36 years in various capacities.
Meetings of the Board of Directors and Board Member Attendance.
--------------------------------------------------------------
During Fiscal 2004, the Board met informally. It acted two
times by unanimous written consent. The Company expects that all
of its Board Members attend the Company's annual meeting. All of
the Company's directors attended last year's annual meeting of
shareholders.
OTHER EXECUTIVE OFFICERS
Position with Position
Name Age the Company Held Since
---- --- ------------- -----------
Mark Murphy 41 Vice President- May 1993
Operations and
Secretary
Jerrold Walkenfeld 48 Principal Accounting June 2002
Officer
Mark Murphy was appointed Vice President - Operations in May
1993. Mr. Mark Murphy joined the Company in January 1993. Prior
to his joining the Company, Mr. Murphy was employed as a manager
by Accurate Testing Co., a metals testing company based in
California, a position he had held since 1988. Mr. Murphy is the
brother of Joseph L. Murphy, the Company's President.
Jerrold Walkenfeld, Principal Accounting Officer, commenced
employment with the Company in June 2002. Since 1995 until his
employment with the Company in June 2002, he was engaged by the
Company as an outside consultant to render financial and
accounting services for the Company. For more than the past five
years, Mr. Walkenfeld has maintained an independent accounting
practice. Mr. Walkenfeld is a certified public accountant.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF
1934.
Section 16(a) of the Securities Exchange Act of 1934
requires the Company's executive officers and directors, and
persons who own more than ten percent of a registered class of
the Company's equity securities, to file reports of ownership and
changes in ownership with the Securities and Exchange Commission.
Based solely on its review of the copies of such forms received
by it, the Company believes that during Fiscal 2004, such forms
have been timely filed with the SEC.
COMMITTEES OF THE BOARD OF DIRECTORS
The Company has an Audit Committee. The Board of Directors
does not have a Compensation Committee or a Nominating Committee
and performs the functions of a Compensation Committee and a
Nominating Committee itself.
DIRECTOR CANDIDATES
The process followed by the Board of Directors to identify
and evaluate director candidates includes requests to Board of
Director members and others for recommendations, meetings from
time to time by the Board of Directors to evaluate biographical
information and background material relating to potential
candidates and interviews of selected candidates by the Board of
Directors.
In considering whether to recommend any particular candidate
for inclusion in the Board of Directors slate of recommended
director nominees, the Board of Directors applies criteria such
as the candidate's integrity, business acumen, knowledge of the
Company's business and industry, experience, diligence, conflicts
of interest and the ability to act in the interests of all
stockholders. The Board of Directors does not assign specific
weights to particular criteria and no particular criterion is a
prerequisite for each prospective nominee. The Company believes
that the backgrounds and qualifications of its directors,
considered as a group, should provide a composite mix of
experience, knowledge and abilities that will allow the Board of
Directors to fulfill its responsibilities.
Stockholders may recommend individuals to the Board of
Directors for consideration as potential director candidates by
submitting their names, together with appropriate biographical
information and background materials and a statement as to
whether the stockholder or group of stockholders making the
recommendation has beneficially owned more than 5% of the
Company's Common Stock for at least a year as of the date such
recommendation is made, to JLM Couture, Inc., Shareholder
Relations, c/o Corporate Secretary, 525 Seventh Avenue, Suite
1703, New York, NY 10018. Assuming that appropriate biographical
and background material has been provided on a timely basis, the
Board of Directors will evaluate stockholder-recommended
candidates by following substantially the same process, and
applying substantially the same criteria, as it follows for
candidates submitted by others.
CODE OF CONDUCT AND ETHICS
The Company has adopted a Code of Conduct and Ethics
applicable to its directors, officers and employees including its
principal executive, principal financial officer, principal
accounting officer or controller or persons performing similar
functions. A copy of the Company's Code of Conduct and Ethics is
available on its website www.jlmcouture.com. The Company intends
to post amendments to or waivers from its Code of Conduct and
Ethics (to the extent applicable to its Chief Executive Officer,
Chief Financial Officer or principal accounting officer) on its
website. The Company's website is not part of this proxy
statement.
AUDIT COMMITTEE
The primary functions of the Audit Committee of the Company
(the "Audit Committee") are to select or to recommend to the
Board of Directors the selection of outside auditors; to monitor
the Company's relationships with the Company's outside auditors
and their interaction with the Company's management in order to
ensure their independence and objectivity; to review, and to
assess the scope and quality of the Company's outside auditors'
services, including the audit of the Company's annual financial
statements; to review the Company's financial management and
accounting procedures; to review the Company's financial
statements with the Company's management and outside auditors;
and to monitor management's compliance with applicable legal
requirements and ethical standards.
Messrs. Sullivan, O'Grady and Cannon are the current members
of the Audit Committee and are each "independent," as that term
is defined under the applicable NASDAQ Stock Market, Inc.
Marketplace Rules. During Fiscal 2004, the Audit Committee met
four times. The Board of Directors has determined that Mr.
Joseph E. O'Grady is an "audit committee financial expert" as
defined in Item 401(h) of Regulation S-K. The Board of Directors
has adopted a written charter for the Audit Committee, a copy of
which is filed as Appendix A to the Company's Proxy Statement for
its fiscal year ended October 31, 2002. A copy of such charter
is also available on the Company's website, www.jlmcouture.com.
SHAREHOLDER COMMUNICATIONS WITH THE BOARD OF DIRECTORS
Shareholders interested in communicating with the Board of
Directors may do so by writing to any or all directors, care of
the Company's Chief Financial Officer, at the Company's principal
executive offices. The Company's Chief Financial Officer will log
in all shareholder correspondence and forward to the director
addressee(s) all communications that, in his judgment, are
appropriate for consideration by the directors. Any director may
review the correspondence log and request copies of any
correspondence. Examples of communications that would be
considered inappropriate for consideration by the directors
include, but are not limited to, commercial solicitations,
trivial, obscene, or profane items, administrative matters,
ordinary business matters, or personal grievances. Correspondence
that is not appropriate for Board of Director review will be
handled by the Company's Chief Financial Officer. All appropriate
matters pertaining to accounting or internal controls will be
brought promptly to the attention of the Company's Audit
Committee Chair.
AUDIT COMMITTEE REPORT
The Audit Committee consists of three members all of whom
meet the independence and experience requirements of the
applicable NASDAQ Marketplace Rules. The Audit Committee's
responsibilities are as described in a written charter adopted by
the Board, which was previously attached as Appendix A to the
Company's Proxy Statement for Fiscal 2002.
The Audit Committee has reviewed and discussed the Company's
audited financial statements for Fiscal 2004 with management and
with the Company's independent registered public accounting firm,
Goldstein Golub Kessler LLP ("GGK"). The Audit Committee has
discussed with GGK the matters required to be discussed by the
Statement on Auditing Standards No. 61 relating to the conduct of
the audit. The Audit Committee has received the written
disclosures and the letter from GGK required by Independence
Standards Board Standard No. 1, Independence Discussions with
Audit Committees, and has discussed with GGK its independence.
Based on the Audit Committee's review of the audited financial
statements and the review and discussions described in this
paragraph, the Audit Committee recommended to the Board that the
audited financial statements for Fiscal 2004 be included in the
Company's Annual Report on Form 10-K for Fiscal 2004 for filing
with the Securities and Exchange Commission.
Submitted by the members of the Audit Committee:
Joseph E. O'Grady
Daniel M. Sullivan
Keith Cannon
AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES
Before the independent public accounting firm is engaged by
the Company to render audit or non-audit services, the engagement
is approved by the Audit Committee.
EXECUTIVE COMPENSATION
The following table sets forth the compensation the Company
paid for its fiscal years ended October 31, 2004, 2003 and 2002
to its Chief Executive Officer and to each of its other executive
officers whose compensation exceeded $100,000 on an annual basis.
SUMMARY COMPENSATION TABLE
Name and Annual Com- Other Long Term Other
Principal Fiscal pensation Annual Com- Compensation/ Compen-
Position Year Salary ($) pensation ($) Options ation($)
-------- ------ ---------- ------------- ------------- --------
Joseph L. 2004 325,000 30,284 - 81,238(2)
Murphy, 2003 325,000 70,132 200,000(1) 38,327
President 2002 325,000 202,807 100,000 37,009
and Chief
Executive
Officer
Mark Murphy, 2004 104,000 6,088 - -
Vice President 2003 103,308 6,088 - -
Operations 2002 97,243 5,000 12,000 -
Jerrold 2004 116,550 4,059 - -
Walkenfeld, 2003 109,975 7,331 - -
Principal 2002 90,921 13,920 - -
Accounting
Officer
___________________
(1) Mr. Murphy agreed to cancel options to purchase 200,000 shares
of Common Stock of the Company for a consideration of $200,000. See
"Certain Relationships and Related Transactions."
(2) Includes $48,000 entertainment expenditure allowance.
EMPLOYMENT AGREEMENT
Mr. Joseph L. Murphy has an employment agreement (the
"Agreement") with the Company which provides for a base salary of
$325,000 per year. As additional compensation, Mr. Murphy
receives five percent (5%) of the Company's annual pre-tax
profits. On August 14, 2001, the Board amended the Agreement to
extend the term of Mr. Murphy's employment until May 19, 2006.
STOCK OPTION PLANS
On August 26, 1996, the Company adopted a stock option plan
(the "1996 Plan"). The 1996 Plan provides for the issuance of
incentive and non-statutory stock options to employees,
consultants advisors and/or directors for a total of up to 100,000
shares of Common Stock. The 1996 Plan was amended by the Board of
Directors in September 1998 to increase the authorized number of
shares thereunder from 100,000 to 250,000 shares. A majority of
the Company's shareholders approved the amendment to the 1996 Plan
in October 1998. The exercise price of options granted may not be
less than the fair market of the shares on the date of grant (110%
of such fair market value for a holder of more than 10% of the
Company's Common Stock). The 1996 Plan will terminate on August
26, 2006.
On October 28, 2003, the Company adopted the 2003 Stock
Incentive Plan (the "2003 Plan"). Awards may be granted under the
Plan on and after its effective date (August 12, 2003). The 2003
Plan authorizes the grant of incentive options, nonqualified
options, SARs, restricted awards and performance awards.
Incentive options may only be granted to employees of the
Company. The option price at which an option may be exercised
must be at least 100% of the fair market value per share of the
Common Stock on the date of grant (or 110% of the fair market
value with respect to incentive options granted to an employee
who owns stock possessing more than 10% of the total voting power
of all classes of stock of the Company). The maximum number of
shares that may be issued pursuant to awards granted under the
2003 Plan may not exceed the sum of (a) 500,000 shares, plus (b)
any shares of Common Stock remaining available for issuance as of
the effective date of the 2003 Plan under the 1996 Plan.
OPTION GRANTS IN FISCAL 2004
No executive officer of the Company was granted stock
options during Fiscal 2004.
AGGREGATED OPTION EXERCISES IN LAST FISCAL
YEAR AND FISCAL YEAR-END (FYE) OPTION VALUES
Value of
Unexercised
Number In-the-Money
Of Unexercised Options
Options At FYE
Shares At FYE Acquired ($)
Acquired Value Exercisable/ Exercisable/
Name On Exercise Realized($) Unexercisable Unexercisable (1)
---- ----------- ----------- ------------- -----------------
Joseph L. 0 0 50,000/50,000 54,000/54,000
Murphy
Mark 0 0 6,000/6,000 6,480/6,480
Murphy
Joseph E. 0 0 7,000/6,000 9,310/10,800
O'Grady
Daniel M. 0 0 21,000/6,000 27,930/6,480
Sullivan
----------------------------
(1) Represents fair market value of Common Stock at October 31,
2004 of $3.18 as reported by Nasdaq, less the exercise
price.
COMPENSATION OF DIRECTORS
Directors not employed by the Company are compensated as
consultants for the time spent on Company matters, including
attendance at directors' and other meetings. During Fiscal 2004,
Messrs. Sullivan, O'Grady and Cannon received $25,106, $40,200
and $24,000, respectively.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of February 28, 2005, the
number of shares of Common Stock held of record or beneficially
(i) by each person who held of record, or was known by the
Company to own beneficially, more than five percent of the
outstanding shares of Common Stock, (ii) by each director and
(iii) by all officers and directors as a group:
Number of Percent of
Names and Address(1) Shares Owned (2) Outstanding shares
-------------------- ---------------- ------------------
Joseph L. Murphy 741,964(3)(4) 36.41%
Daniel M. Sullivan 103,499(3) 5.21%
Joseph E. O'Grady 34,000(3) 1.72%
Keith Cannon 1,000(6)
FMR Corp. 197,100(5) 10.04%
82 Devonshire Street
Boston, MA 02109
All directors and 913,520(3) 45.07%
officers as a
group (6 persons)
----------------
(1) Unless otherwise indicated, a person's address is c/o JLM
Couture, Inc., 525 Seventh Avenue, Suite 1703, New York, NY
10018.
(2) Unless otherwise indicated, all shares of Common Stock are
owned directly.
(3) Includes 75,000, 24,000, 10,000 and 118,000 shares for
Messrs. Murphy, Sullivan, O'Grady and all officers and
directors as a group, respectively, that are issuable upon
exercise of presently exercisable options at an average
exercise price of approximately $1.99 per share.
(4) 148,331 of these shares are pledged to a bank to secure a
personal loan.
(5) Based on information furnished to the Company on Schedule
13G/A dated February 14, 2002.
(6) Less than one percent.
The Company is unaware of any arrangement, the operation of
which, at a subsequent date, may result in a change of control of
the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On December 22, 1998, Mr. Joseph L. Murphy purchased from
the Company 200,000 shares of Common Stock at a price of $2.25
per share, the market value of such shares on such date. The
purchase was financed by Mr. Murphy executing a ten year
promissory note due to the Company in the principal amount of
$450,000. The promissory note bears interest at 5% per annum and
requires annual principal payments of $45,000 with accrued
interest. The purchase was approved by the unanimous consent of
the Board. The Company sold these shares to Mr. Murphy because
it was deemed to be in the best interests of the Company for him
to increase his equity ownership in the Company to better align
his interest with that of the other shareholders of the Company.
$180,000 of this note currently remains unpaid. Interest is
current through February 22, 2005 and the annual
principal payment of $45,000 due on December 22, 2004 was paid.
On February 24, 2003, the Company and Mr. Murphy agreed to
cancel 200,000 of Mr. Murphy's exercisable options upon payment
of $200,000 to Mr. Murphy. On that date, this payment
represented an imputed discount of approximately 16% from the
closing price of the Common Stock as reported by NASDAQ minus the
exercise price of such options.
[INSERT PERFORMANCE GRAPH]
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Audit Committee has reappointed GGK to audit the
consolidated financial statements of the Company for Fiscal 2005.
GGK has served as the Company's independent registered public
accounting firm since Fiscal 2002. A representative from GGK is
expected to be present at the Meeting with the opportunity to
make a statement if he or she desires to do so and to be
available to respond to appropriate questions.
Although shareholder ratification of the appointment is not
required by law, the Company desires to solicit such
ratification. If the appointment of GGK is not approved by a
majority of the shares represented at the Annual Meeting, the
Company will consider the appointment of another independent
registered public accounting firm for Fiscal 2005.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE
"FOR" RATIFICATION OF THE APPOINTMENT OF GGK AS THE COMPANY'S
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL 2005.
AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES
Before a registered independent public accounting firm is
engaged by the Company to render audit or non-audit services, the
engagement is approved by the Audit Committee.
INDEPENDENT AUDITOR FEE INFORMATION
The following table shows the fees that the Company paid or
accrued for the audit and other services provided by GGK or its
current tax accountants for Fiscal 2004 and Fiscal 2003.
Amountof Fee for
Type of Service Fiscal 2004 Fiscal2003
------------------ ------------- ------------
Audit Fees $ 80,726 $ 69,114
Audit-Related Fees 0 0
Tax Fees 4,650 4,200
All Other Fees 0 0
-------- -------
$ 85,376 $ 73,314
======== ========
AUDIT FEES. This category includes fees for the audits of
the Company's annual financial statements, review of financial
statements included in the Company's Form 10-Q Quarterly Reports
and services that are normally provided by the independent
auditors in connection with statutory and regulatory filings or
engagements for the relevant fiscal years.
AUDIT-RELATED FEES. This category consists of due diligence
in connection with acquisitions, various accounting
consultations, and benefit plan audits.
TAX FEES. This category consists of professional services
rendered for tax compliance, tax planning and tax advice. The
services for the fees disclosed under this category include tax
return preparation, research and technical tax advice.
ALL OTHER FEES. There were no other fees paid or accrued to
GGK in Fiscal 2004.
GGK has a continuing relationship with American Express Tax
and Business Services Inc. ("TBS") from which it leases auditing
staff who are full time, permanent employees of TBS and through
which its partners provide non-audit services. As a result of
this arrangement, GGK has no full time employees and therefore,
none of the audit services performed were provided by permanent
full time employees of GGK. GGK manages and supervises the audit
and audit staff, and is exclusively responsible for the opinion
rendered in connection with its examination.
OTHER MATTERS
The Board of Directors has no knowledge of any other matters
which may come before the Meeting and does not intend to present
any other matters. However, if any other matters shall properly
come before the Meeting or any adjournment thereof, the persons
named as proxies will have discretionary authority to vote the
shares of Common Stock represented by the accompanying proxy in
accordance with their best judgment.
SHAREHOLDERS' PROPOSALS
Any shareholder of the Company who wishes to present a
proposal to be considered at the next annual meeting of
shareholders of the Company and who wishes to have such proposal
presented in the Company's Proxy Statement for such meeting must
deliver such proposal in writing to the Company at 525 Seventh
Avenue, Suite 1703, New York, New York 10018 on or before _____,
2006.
By Order of the Board of Directors
Mark Murphy
Secretary
Dated: [ ], 2005
APPENDIX A
JLM COUTURE, INC.
PROXY
Proxy for 2005 Annual Meeting of Shareholders.
The undersigned hereby appoints Daniel Sullivan and Joseph
E. O'Grady proxies of the undersigned, with full power of
substitution, to vote shares of Common Stock of the Company which
the undersigned would be entitled to vote if present at the 2005
Annual Meeting of Shareholders of the Company to be held on [
], 2005 at 11:00 A.M. at the offices of Kalin Levine Weinberg LLC
located at 494 Eighth Avenue, Suite 800, New York, NY 10001 and
any adjournments thereof, upon the matters set forth in the
Notice of Annual Meeting as follows:
The undersigned acknowledges receipt of the Notice of
Annual Meeting, Proxy Statement and the Company's Annual Report
for Fiscal 2004.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
and when properly executed will be voted as directed herein. If
no direction is given, this Proxy will be voted FOR the nominee
listed in proposal 1.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEE
LISTED IN ITEM 1.
(1) ELECTION OF CLASS I DIRECTOR:
(Mark ONE box only)
Instructions:
To vote FOR the Class I Director nominee, place an X in Box
Number 1.
To withhold authority to vote for the Class I Director
nominee, place an X in Box Number 2.
To withhold authority to vote for the nominee place an X
in box Number 3 and strike a line through such nominee's name in
the list below.
1. ____ For Class I Director nominee.
2. ____ Withhold authority to vote for the Class I
Director nominee.
3. ____ Withhold authority to vote for any
individual nominees. Strike a line through such
nominee(s) name below:
- Joseph E. O'Grady
(2) RATIFICATION OF THE APPOINTMENT OF GOLDSTEIN GOLUB KESSLER
LLP AS THE COMPANY'S INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM FOR THE COMPANY'S FISCAL YEAR ENDING
OCTOBER 31, 2005.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
In their discretion, the proxies are authorized to vote upon
other matters properly coming before the meeting or any
adjournment thereof.
DATED: , 2005
---------------------
-------------------------------------
(Signature)
-------------------------------------
(Signature, if held jointly)
Where stock is registered in the
names of two or more persons ALL
should sign. Signature(s) should
correspond exactly with the name(s)
as shown above. Please sign, date
and return promptly in the enclosed
envelope. No postage need be affixed
if mailed in the United States.
Requests for copies of proxy statements, the Company's
Annual Report for Fiscal 2004, or the Company's Annual Report for
Fiscal 2004 on Form 10-K should be addressed to Shareholder
Relations, JLM Couture, Inc., 525 Seventh Avenue, Suite 1703, New
York, NY 10018. This material will be furnished without charge
to any shareholder requesting it.