Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [ ]
Filed by a party other than the Registrant [x]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14A-6 (e)(2))
[ ] Definitive Proxy Statement
[ ] Deifinitive Additional Materials
[ ] Soliciting Materials Pursuant to ss.240.14a-11c or
SS.240.14a-12
First Years Inc
(Name of Registrant as Specified In Its Charter)
Phillip Goldstein
(Name of Person(s)Filing Proxy Statement if other then the
Registrant)
PROXY STATEMENT IN OPPOSITION TO THE SOLICITATION BY THE BOARD OF
DIRECTORS OF THE FIRST YEARS, INC.
ANNUAL MEETING OF STOCKHOLDERS (To be held on May 15, 2003)
My name is Phillip Goldstein. I am a shareholder of The First
Years, Inc. (the "Company"). I am an investment manager
presently managing investment portfolios with assets totaling
more than $75 million. I am sending this proxy statement and
the enclosed GREEN proxy card to stockholders of record on March
20, 2003 (the "Record Date") of the Company. I am soliciting a
proxy to vote your shares at the 2003 Annual Meeting of
Stockholders of the Company (the "Meeting") and at any and all
adjournments or postponements of the Meeting. Please refer to
the Company's proxy soliciting material for additional
information concerning the Meeting and the matters to be
considered by the shareholders including the election of
directors.
This proxy statement and the enclosed GREEN proxy card are first
being sent to shareholders of the Company on or about April --,
2003.
INTRODUCTION
There are two matters that the Company has scheduled to be
voted upon at the meeting:
1. The election of three persons to serve as directors of the
Company.
2.The ratification of the appointment of Deloitte & Touche LLP
as independent accountants of the Company for the fiscal year
ending December 31, 2003.
In addition, I intend to introduce the following proposal at
the meeting.
3. The Company's poison pill rights shall be dismantled.
With respect to these matters, I am soliciting a proxy to vote
your shares FOR the election of one nominee
and FOR Proposals 2 and 3.
How Proxies Will Be Voted
All of the proposals scheduled by the Company to be voted upon at
the meeting are included on the enclosed GREEN proxy card. If
you will not attend the meeting and you wish to vote FOR the
election of my nominee and/or FOR my proposal, you may do so by
completing and returning a GREEN proxy card.
If you return a GREEN proxy card to me or to my agent, your
shares will be voted on each matter as you indicate subject to
the following condition: Ronald J. Sidman, the Company's
Chairman, President and Chief Executive Officer shall not prevent
the persons named as proxies from nominating Gerald Hellerman for
election as a director and presenting Proposal 3. Mr. Sidman has
advised me that he will not permit me to nominate Mr. Hellerman
or present any proposal at the Meeting because I allegedly did
not give him sufficient advance notice of my intentions. I have
asked Mr. Sidman to waive the Company's advance notice
requirement so that the shareholders can have an opportunity to
vote as they wish at the Meeting but thus far, he has refused to
do so. I believe that if a lawsuit is brought to order Mr.
Sidman to count all the proxies, it could well succeed. I will
continue to ask Mr. Sidman to permit me to vote all the proxies
as instructed but if he refuses, your shares may not be voted at
the Meeting and I may consider other options including filing a
lawsuit to order the Company to count your votes and/or declining
to attend the meeting which may prevent a quorum from being
reached.
Subject to the foregoing condition, in the event that you do not
indicate how your shares are to be voted on a matter, they will
be voted FOR the election of my nominee to the Board and FOR
Proposals 2 and 3. If you return a GREEN proxy card, you will be
granting the proxy holder(s) discretionary authority to vote on
any other matters of which they are not now aware that may come
before the meeting including matters relating to the conduct of
the meeting.
Voting Requirements
I do not intend to propose an adjournment of the meeting. If an
adjournment is proposed, the proxy holder(s) will vote for or
against such adjournment in their discretion. Please refer to the
Company's proxy statement for the quorum requirements and the
voting requirements for each proposal it will present. Proposal
3 requires a majority of the votes cast for approval.
Revocation of Proxies
You may revoke any proxy prior to its exercise by (i) delivering
a written revocation of your proxy at the meeting; (ii) executing
and delivering a later dated proxy to me or to the Company or to
our respective agents; or (iii) voting in person at the meeting.
(Attendance at the meeting will not in and of itself revoke a
proxy.) There is no limit on the number of times you may revoke
your proxy prior to the meeting. Only the latest dated, properly
signed proxy card will be counted
Information Concerning the Soliciting Shareholder
I, Phillip Goldstein, am the Soliciting Shareholder. My address
is 60 Heritage Drive, Pleasantville, NY 10570. I am an investment
manager who presently manages investment portfolios with assets
in excess of $75 million. Since December 1, 1992, I have been the
president and 50% shareholder of Kimball & Winthrop, Inc., the
general partner of Opportunity Partners L.P., a private
investment partnership. I am also the portfolio manager of
Opportunity Partners. Since 1996, I have taken an active role in
urging the management of other companies to take various actions
that I believe would benefit those companies and their
shareholders. My actions have included discussions with
management, submitting a shareholder proposal, conducting a proxy
contest and filing a lawsuit alleging breach of fiduciary duty.
I am deemed to be the beneficial owner of --------- shares of
Common Stock owned by my clients and me including ----------
shares owned by Opportunity Partners and ------- shares owned
jointly by my wife and me. All of our purchases of Common Stock
have been within the past two years.
REASONS FOR THE SOLICITATION
Based on an analysis of the Company's finances and growth
potential, I believe that the Company's stock is undervalued and
that the Company can be sold at a significant premium to its
market value. I also believe the poison pill, which was adopted
by the board without stockholder approval, is a serious
impediment to such a sale. Therefore, I wish to afford
shareholders an opportunity to (1) determine whether they want to
dismantle the poison pill and (2) elect a director to replace Mr.
Sidman's 89 year-old mother with someone who has no ties to
management and who is committed to pursuing such a sale if
Proposal 3 is approved.
OTHER CONSIDERATIONS
If my nominee is elected, there is no assurance that the entire
board will agree to seek a sale of the Company. In addition, a
sale of the Company may require shareholder approval, and no
assurance can be given that such approval will be obtained.
Finally, various costs, including but not limited to those
related to holding a special meeting of shareholders, which would
be borne indirectly by shareholders, may be associated with such
actions. I believe that such costs are far outweighed by the
benefit of a sale at a premium to the market price of the
Company's stock.
I believe that all shareholders of the Company will benefit if
actions are taken to improve shareholder value. However, I also
have personal financial incentives to increase the Company's
stock price because my clients who hold shares of the Company pay
me fees that are based upon the realized and unrealized gains
that they earn. Thus, these fees may partially depend on the
value of the Company's shares.
PROPOSAL 1: ELECTION OF DIRECTORS
At the meeting, if permitted by Mr. Sidman, I will nominate the
following person for election as a director for a term expiring
in 2006.
Gerald Hellerman (Age 65), 10965 Eight Bells Lane, Columbia, MD
21044
Gerald Hellerman, 65, has been the principal of Hellerman
Associates, a financial and corporate consulting firm since he
founded the firm in 1993. Present clients of Hellerman
Associates include the U.S. Department of Justice, and the
National Oceanic and Atmospheric Administration, a unit of the
U.S. Department of Commerce. Mr. Hellerman has served as a
trustee or director of Third Avenue Value Trust from 1993 until
2002, and trustee of Third Avenue Variable Series Trust from 1999
until 2002. Mr. Hellerman is a director and president of The
Mexico Equity and Income Fund, a position he has held since 2001.
He also serves as a director of Innovative Clinical Solutions,
Inc., and Frank's Nursery & Crafts, Inc. During March 2003 he was
elected a director and chairman of the board of meVC Draper
Fisher Jurvetson Fund I, Inc., and a director of Brantley Capital
Corporation. During the past five years, he also served as a
director of Clemente Global Growth Fund, Inc.
Mr. Hellerman does not own any shares and he does not have any
arrangement or understanding with any person with respect to any
future employment by the Company or by any affiliate of the
Company.
The persons named as proxies on the enclosed GREEN proxy card
intend, in the absence of contrary instructions, to vote all
proxies they are entitled to vote IN FAVOR of the election of Mr.
Hellerman who has consented to stand for election and to serve if
elected. If Mr. Hellerman is unable to serve, an event not now
anticipated, the proxies will be voted for such other person, if
any, as is designated by the proxy holder(s). In addition, I
intend to vote all GREEN proxies for the election of Walker J.
Wallace and Lewis M. Weston, who are management's nominees unless
you indicate that you wish to withhold authority to vote for
either or both of them but not to vote for Evelyn Sidman, the
remaining management nominee. I have not requested permission to
name Walker J. Wallace and Lewis M. Weston in my proxy materials
nor have they granted me such permission. You should refer to
management's proxy statement for information regarding the
qualifications and background of its nominees. There is no
assurance that any of management's nominees will serve as
directors if my nominee is elected.
PROPOSAL 2: RATIFICATION OF THE SELECTION OF DELOITTE & TOUCHE
LLP AS INDEPENDENT ACCOUNTANTS OF THE COMPANY
In the absence of contrary instructions, the proxy holder(s) will
vote your shares FOR this proposal.
PROPOSAL 3: A STOCKHOLDER PROPOSAL TO DISMANTLE THE COMPANY'S
PILL
I think the best way to maximize shareholder value is to sell the
Company to a strategic buyer, i.e., one who is in a similar or
related business and that can realize synergies or reduce
overhead expenses in the combined company's operations. The
Company's board of directors has adopted a poison pill whose
purpose is to prevent shareholders from accepting a premium offer
for their shares unless the board approves it. I do not think
the board should have a veto over the shareholders if they
determine that they wish to accept such an offer. Therefore,
unless precluded from doing so by Mr. Sidman, I intend to
introduce a non-binding proposal recommending that the Company
dismantle its poison pill. There is no certainty that the board
will implement this proposal if it is approved. In the absence
of contrary instructions, the proxies will vote your shares FOR
this proposal.
THE SOLICITATION
I am making this solicitation personally. Persons affiliated
with or employed by affiliates of Opportunity Partners may assist
me in the solicitation of proxies. They will not receive any
special compensation for their services. Banks, brokerage houses
and other custodians, nominees and fiduciaries will be requested
to forward this proxy statement and the enclosed GREEN proxy card
to the beneficial owners of shares of Common Stock for whom they
hold shares of record. I will reimburse these organizations for
their reasonable out-of-pocket expenses.
Initially, I will personally bear all of the expenses related to
this proxy solicitation. Because I believe that the shareholders
will benefit from this solicitation, I intend to seek
reimbursement of these expenses from the Company. Shareholders
will not be asked to vote on the reimbursement of solicitation
expenses incurred by either the incumbent directors or me. I
estimate that my expenses will be about $15,000. As of April --,
2003, my expenses have been approximately $---------.
There is no arrangement or understanding involving me or any
affiliate of mine that relates to future employment by the
Company or any future transaction with the Company.
ADDITIONAL PROPOSALS
I know of no business that will be presented for consideration at
the meeting other than that set forth in this proxy statement and
in the Company's proxy statement. Unless instructed otherwise,
if any other matters are properly presented for consideration at
the meeting, it is the intention of the persons named as proxies
in the enclosed GREEN proxy card to vote in accordance with their
own best judgment on such matters.
DATED: April --, 2003
PROXY CARD
PROXY SOLICITED IN OPPOSITION TO THE BOARD OF DIRECTORS OF THE
FIRST YEARS, INC. BY PHILLIP GOLDSTEIN FOR THE ANNUAL MEETING OF
STOCKHOLDERS ON MAY 15, 2003
The undersigned hereby appoints Andrew Dakos, Rajeev Das, Steve
Samuels and Phillip Goldstein, and each of them, as the
undersigned's proxies, with full power of substitution, to attend
the Annual Meeting of Shareholders of The First Years, Inc. on
May 15, 2003, (the "Meeting"), and any adjournment or
postponement thereof, and to vote on all matters that may come
before the Meeting and any such adjournment or postponement the
number of shares that the undersigned would be entitled to vote
if present in person, as specified below.
(INSTRUCTIONS:Mark votes by placing an "x" in the appropriate
[].)
1. ELECTION OF THREE DIRECTORS
[ ] FOR GERALD HELLERMAN [ ] WITHHOLD AUTHORITY
Note: It is intended that this proxy will be voted for the
election of Walker J. Wallace and Lewis M. Weston,
management's nominees (in addition to Mr. Hellerman) unless you
indicate that you wish to withhold authority to vote for either
or both of them by crossing out their name(s) in this sentence.
Permission has not been requested to name Walker J. Wallace and
Lewis M. Weston in the accompanying proxy materials nor have they
granted such permission. There is no intention to vote this
proxy for any other management nominee. Please refer to
management's proxy statement for information regarding the
qualifications and background of its nominees. There is no
assurance that any of management's nominees will serve as
directors if Mr. Hellerman is elected.
2. RATIFICATION OF THE SELECTION OF DELOITE & TOUCHE LLP AS
INDEPENDENT ACCOUNTANTS
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. A STOCKHOLDER PROPOSAL TO DISMANTLE THE COMPANY"S POISON PILL
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Please sign and date below. Your shares will be voted as
directed. If no direction is made, this proxy will be voted FOR
the election of the nominees named above in Proposal 1, and FOR
Proposals 2 AND 3. The undersigned hereby acknowledges receipt
of the proxy statement dated April --, 2003 of Phillip Goldstein
and revokes any proxy previously executed. (Important - Please
be sure to enter date.)
SIGNATURE (S)______________________ Dated: _______________