UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934 (Amendment
No. )
Filed by the
Registrant þ
Filed by a Party other than the
Registrant o
Check the appropriate box:
o Preliminary
Proxy Statement
o Confidential,
for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
o Definitive
Proxy Statement
þ Definitive
Additional Materials
o Soliciting
Material Pursuant to
§240.14a-12
BLAIR CORPORATION
(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):
þ No
fee required.
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Fee computed on table below per
Exchange Act
Rules 14a-6(i)(1)
and 0-11.
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(1)
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Title of each class of securities
to which transaction applies:
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Common Stock, no par value, of
Blair Corporation
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Aggregate number of securities to
which transaction applies:
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Per unit price or other underlying
value of transaction computed pursuant to Exchange Act
Rule 0-11
(set forth the amount on which the filing fee is calculated and
state how it was determined):
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Proposed maximum aggregate value of
transaction:
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o Fee
paid previously with preliminary materials.
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Check box if any part of the fee is
offset as provided by Exchange Act
Rule 0-11(a)(2)
and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing.
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Amount Previously Paid:
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Form, Schedule or Registration
Statement No.:
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Persons who are to respond to
the collection of information contained in this form are not
required to respond unless the form displays a currently valid
OMB control number.
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The foregoing contains certain "forward-looking statements" within the definition of federal securities laws.
Statements made in this presentation regarding the company's definitive agreement and intention to sell substantially
all of its and its affiliates' credit portfolio, to enter into a long term marketing and servicing alliance, expectations and
intentions regarding use of such sale proceeds, expectations regarding the accretive nature of the transaction and
subsequent resulting income generation are forward-looking statements. The company cautions that forward-looking
statements, as such term is defined in the Private Securities Litigation Reform Act of 1995, contained in this report
are based on estimates, projections, beliefs and assumptions of management at the time of such statements and are
not guarantees of future performance. The company disclaims any obligation to update or revise any forward-
looking statements based on the occurrence of future events, the receipt of new information, or otherwise. Forward-
looking statements of the company involve risks and uncertainties and are subject to change based on various
important factors. Actual future performance, outcomes and results may differ materially from those expressed in
forward-looking statements made by the company and its management as a result of a number of risks, uncertainties
and assumptions. Representative examples of those factors (without limitation) include the company's success in
gaining regulatory review and approval of the transaction; general retail industry conditions and macro-economic
conditions; economic and weather conditions for regions in which the company's stores are located and the effect of
these factors on the buying patterns of the company's customers; the impact of competitive pressures in the
department store industry and other retail channels including specialty, off-price, discount, internet, and mail-order
retailers; potential disruption from terrorist activity; world conflict and the possible impact on consumer spending
patterns and other economic and demographic changes of similar or dissimilar nature.
Forward-Looking Statements
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The 2007 EBIT and EBITDA management projections referred to in this presentation were used by our financial
advisor, Stephens, Inc. for their fairness opinion issued to the Blair Corporation Board of Directors in connection with
the proposed acquisition of Blair Corporation by Appleseed's Topco, Inc. These projections supplied to Stephens Inc.
were not prepared by Blair Corporation's management with a view to compliance with published guidelines of the
SEC or the guidelines established by the American Institute of Certified Public Accountants regarding projections or
forecasts. Neither our independent auditor, nor any other independent accountants have compiled, examined or
performed any procedures with respect to the projections. These projections are forward-looking statements and
represented our management's best estimates as of January 22, 2006 and do not reflect events after that date
including, but not limited to, the year to date performance as of February 2007 as found in a press release filed in a
8-K on March 19, 2007. Based on such events, various changes to several of the assumptions which are set forth
below, and the other matters referred to in this paragraph, we believe that these projections may no longer be
reliable indications of our future results. While presented with numeric specificity, the forecasts reflect numerous
assumptions made by our management with respect to industry performance, general business, economic, market
and financial conditions, and other matters, including assumed effective tax rates consistent with historical levels for
us, all of which are difficult to predict, many of which are beyond our control. Accordingly, there can be no assurance
that the assumptions made in preparing the projections will prove accurate. The inclusion of these projections should
not be regarded as an indication that Blair Corporation, considered or consider such data to be a reliable prediction
of future events, and such data should not be relied upon as such. Except to the extent required under applicable
laws, we do not intend to make publicly available any update or other revisions to the forecasts to reflect
circumstances existing after the date of the preparation of the projections. See ''Forward-Looking Statements'' on
page 2.
Projections Used in This Presentation
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Certain non-GAAP financial measures are discussed in this presentation that the Blair Corporation believes are
useful to investors in evaluating the company's performance and was a financial measure used by Blair Corporation's
financial advisor Stephens Inc. Information to provide a reconciliation to the nearest GAAP measure is provided on
page 19.
EBITDA, as used on pages 7, 13, 15 and 17, is not prepared in conformity with GAAP and is defined as net income
(loss) excluding amounts for income taxes, depreciation and amortization and all other non-operating
income/expenses, and is a common measure of operating performance in the retail industry. This non-GAAP
financial measure should not be considered as an alternative to net income, operating income, operating margin, or
cash provided by operating activities. Blair Corporation's definition of EBITDA may not be comparable with non-
GAAP financial measures used by other companies.
Management believes EBITDA provides meaningful supplemental information regarding our liquidity and
performance by excluding the items discussed above. Additionally, management believes this financial information is
useful to investors in assessing Blair Corporation's historical financial performance and for planning, forecasting and
analyzing future periods since it is an important metric used by management for those same activities, as well as
evaluating future investing and financing decisions. While management uses EBITDA as a measurement of liquidity,
this non-GAAP financial measure does not consider debt-service payments, or cash generated by us that is available
for capital expenditures, dividends and discretionary investment.
Notes on non-GAAP Financial Measures
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Background of the Merger
The board has frequently discussed potential strategic alternatives including possible mergers or
acquisitions that would complement and enhance the Company's competitive strengths, strategic
position and stockholder value
On two separate occasions between 2001-2003 the Company signed letters of intent to acquire Appleseed's though
the transaction did not move beyond the due diligence stage
In November 2005, after the acquisition of Appleseed's by Golden Gate, Blair management contacted
the CEO of Appleseed's to invite him to join the Blair management team, an offer which was declined
From January 2006 to April 2006, Appleseed's and Blair had several conversations about strategic
alternatives in which Appleseed's proposed a combination - Blair continued to evaluate multiple other
acquisition opportunities
May 2006, as a part of Blair pursuing potential acquisition candidates, one of Blair's advisors contacted
Golden Gate about the possible sale of Appleseed's or other of their portfolio companies to Blair -
Golden Gate was not interested in selling
August 2006, Golden Gate told the Company's advisor that they were interested in acquiring Blair and
indicated that if Blair were not interested they might consider various alternatives including a tender offer
November 13, 2006, the Chairman and the CEO of Blair met with representatives from Golden Gate and
Appleseed's who laid out their strategic direction and stated their interest in acquiring Blair though no
specific offer was made at that time - Blair communicated they were not interested in being acquired
January 3, 2007, the Company received an offer letter from Appleseed's to acquire all of the Company's
common stock for $37.50 per share in cash
The letter stated that if the Company did not respond within two days, Appleseed's reserved the right to make the
offer public and to take such actions as commencing a tender offer and proposing a slate of directors
The Blair board met on January 8, 2007 to discuss strategic alternatives, defensive measures and to
review the offer - which it determined to be inadequate
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Background of the Merger (continued)
January 9, 2007, Blair representatives and financial advisors met with Golden Gate and Appleseed's
Blair was informed that Appleseed's and its affiliates had acquired over 5% of Blair stock and they were still
interested in buying Blair, by tender offer if an agreement could not be reached with the board
Blair informed them that the offer of $37.50 per share was not sufficient
January 10, 2007, Golden Gate and Appleseed's increased their offer to $39.00 per share in cash
January 11, 2007, the Blair board met to evaluate the new proposal and strategic alternatives
The board authorized its financial advisor to contact parties previously interested in acquiring Blair - these parties
were either no longer interested, or not interested at the current offer price
January 14, 2007, the Blair board met with representatives of Golden Gate and Appleseed's
Following a presentation by Golden Gate on its portfolio of companies and their plans for Blair, the board went
through an analysis of the $39.00 per share offer with financial advisors and rejected the offer
January 15, 2007, the offer was raised to $41.50 per share in cash and the board directed its financial
advisor to negotiate with Appleseed's to obtain a higher price and the right to a go-shop period
January 16, 2007, the offer was raised to $42.50 per share and the go-shop period was agreed to - the
board authorized management to negotiate a merger agreement
January 17, 2007 - January 22, 2007, specific terms of the merger agreement were negotiated
The board was kept apprised of important details by financial and legal advisors - at one point Appleseed's lowered
it's price to $41.50 per share, which was rejected by the board and subsequently returned to $42.50 per share
A fairness opinion was delivered on January 22, 2007
January 23, 2007, the board unanimously approved and adopted the merger agreement and
unanimously resolved to recommend that stockholders vote to adopt the merger agreement - the parties
executed the merger agreement and publicly announced the transaction by joint press release
Note: A more detailed description of the background of the merger can be found in the Company's proxy statement filed with the SEC on March 21, 2007.
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