Edgar Filing: NAUTICA ENTERPRISES INC

SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

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 Section 240.14a-12

NAUTICA ENTERPRISES, INC.
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(Name of Registrant as Specified In Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than Registrant)

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pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
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previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

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NAUTICA ENTERPRISES, INC.
------------------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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New York, New York
June 8, 2001

To the Stockholders of
NAUTICA ENTERPRISES, INC.

The Annual Meeting of Stockholders of Nautica Enterprises, Inc. will be
held on July 10, 2001 at the offices of the Company, 40 West 57th Street, New
York, New York, at 10:00 a.m. for the following purposes:

(1) To elect directors to serve until the next annual meeting of
stockholders or until their successors are duly elected and qualified;
and

(2) To transact such other business as may properly come before the meeting
and any adjournment or adjournments thereof.

Only stockholders of record at the close of business on May 30, 2001 are
entitled to notice of and to vote at the meeting and any adjournment or
adjournments thereof.

STOCKHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING IN PERSON, BUT WISH
THEIR STOCK TO BE VOTED ON MATTERS TO BE PRESENTED TO THE MEETING, ARE URGED TO
REVIEW THE ATTACHED PROXY STATEMENT PROMPTLY AND THEN COMPLETE AND RETURN THE
ENCLOSED PROXY IN THE ACCOMPANYING POSTAGE-PAID, ADDRESSED ENVELOPE, OR VOTE BY
TELEPHONE OR VIA THE INTERNET BY FOLLOWING THE INSTRUCTIONS FOR VOTING SET FORTH
IN THE ATTACHED PROXY STATEMENT AND ON THE PROXY CARD. IF YOU ATTEND THE
MEETING, YOU MAY WITHDRAW YOUR PROXY AND VOTE YOUR SHARES PERSONALLY.

By Order of the Board of Directors,

HARVEY SANDERS,
Chairman
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NAUTICA ENTERPRISES, INC.
40 WEST 57TH STREET
NEW YORK, NEW YORK 10019

PROXY STATEMENT

This Proxy Statement is furnished with respect to the solicitation of
proxies by the Board of Directors of Nautica Enterprises, Inc. (the "Company")
for the Annual Meeting of Stockholders of the Company to be held at 10:00 a.m.
on July 10, 2001 and at any adjournment or adjournments thereof, at 40 West 57th
Street, 7th floor, New York, New York. The approximate date on which the Proxy
Statement and form of proxy was first sent or given to stockholders was June 8,
2001.

As of the close of business on May 30, 2001, the date for determining the
stockholders of record entitled to notice of and to vote at the Annual Meeting
and any adjournment or adjournments thereof, there were issued and outstanding
33,084,392 shares of the Company's Common Stock, the holders thereof being
entitled to one vote per share. The presence at the Annual Meeting of a majority
of such shares, in person or by proxy, are required for a quorum. All shares
that have been properly voted, whether by telephone, Internet or mail, and not
revoked, will be treated as being present for the purpose of determining the
presence of a quorum at the Annual Meeting and will be voted at the Annual
Meeting.

The form of proxy solicited by the Board of Directors affords stockholders
the ability to specify a choice among approval of, disapproval of, or abstention
with respect to, each matter to be acted upon at the Annual Meeting. Shares
represented by the proxy will be voted and, where the solicited stockholder
indicates a choice with respect to any matter to be acted upon, the shares will
be voted as specified. If any other matters are properly presented for
consideration at the Annual Meeting, the persons named in the proxy will have
the discretion to vote on those matters.

The expense of the solicitation of proxies for the meeting, including the
cost of mailing, will be borne by the Company. In addition to mailing copies of
the enclosed proxy materials to stockholders, the Company may request persons,
and reimburse them for their expenses with respect thereto, who hold stock in
their names or custody or in the names of nominees for others to forward copies
of such materials to those persons for whom they hold stock of the Company and
to request authority for the execution of the proxies. In addition to the
solicitation of proxies by mail, it is expected that some of the officers,
directors, and regular employees of the Company, without additional
compensation, may solicit proxies on behalf of the Board of Directors by
telephone, telefax, and personal interview.

Stockholders of record may vote by telephone, via the Internet or by mail.
A toll-free telephone number and web site address are included on the proxy
card. For stockholders who choose to vote by mail, a postage-paid envelope is
provided.

Voting by Telephone. Stockholders of record may vote by using the
toll-free number listed on the proxy card. Telephone voting is available 24
hours a day. Easy-to-follow voice prompts allow stockholders to vote their
shares and confirm that their instructions have been properly recorded. The
Company's telephone voting procedures are designed to authenticate stockholders
by using individual control numbers provided on each proxy card. Stockholders
who vote by telephone need not return the proxy card. Please see the proxy card
for specific instructions.
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Voting via the Internet. Stockholders of record may also vote via the
Internet as instructed on the proxy card. Internet voting is available 24 hours
a day. As with telephone voting, stockholders will be given the opportunity to
confirm that votes have been properly recorded. The Company's Internet voting
procedures are designed to authenticate stockholders by using individual control
numbers provided on each proxy card. Stockholders who vote via the Internet need
not return the proxy card. Please see the proxy card for specific instructions.

Voting by Mail. If a stockholder chooses to vote by mail, the proxy card
should be signed, dated and returned in the postage-paid envelope provided. If a
proxy card is signed, dated and mailed without indicating how it should be
voted, it will be voted as recommended by the Board of Directors.

ELECTION OF DIRECTORS

The persons named in the accompanying proxy intend to vote for the election
as directors the eight nominees listed herein. All of the nominees have
consented to serve if elected. All directors will be elected to hold office
until the next annual meeting of stockholders, and, in each case, each director
will serve until his successor is elected and qualified or until his earlier
resignation or removal. If a nominee should be unable to act as a director,
which is not anticipated, the persons named in the proxy will vote for any
nominee who shall be designated by the present Board of Directors to fill the
vacancy. Each of the nominees presently serves as a director.

Set forth below is biographical information for each of the nominees.
Unless otherwise indicated, each has served in his stated capacity for the last
five years:

Robert B. Bank, age 54, has been a Director of the Company since 1989. He
is President of Robert B. Bank Advisory Services, a venture capital investment
firm.

David Chu, age 46, joined the Company in 1984 and has been a Director since
1987. He has served as Executive Vice President of the Company since 1989 and
President of Nautica International, Inc. and Nautica Apparel, Inc., each
wholly-owned subsidiaries of the Company, since 1984. He is a director of
Danskin, Inc.

George Greenberg, age 79, has been a Director of the Company since 1988. He
is Vice Chairman and a Director of Guilford Mills, Inc., a textile manufacturer.
Mr. Greenberg is the father-in-law of Harvey Sanders, Chairman of the Board and
President of the Company.

Israel Rosenzweig, age 53, has been a Director of the Company since 1990.
He is a Senior Vice President of BRT Realty Trust and has served in this
capacity since April 1, 1998. On March 31, 2000, Mr. Rosenzweig became President
of GP Partners, Inc., a corporation which renders advice to a private fund
engaged in investing in securities of real estate investment trusts. He was a
Director of Bankers Federal Savings FSB, a savings and loan association from
1993 through April 1997, and was its Executive Vice President and Chief Lending
Officer from November 1994 through April 30, 1997. From May 1, 1997 to March 31,
1998, Mr. Rosenzweig was associated on a full-time basis with Gould Investors,
L.P., a limited partnership which owns a diverse real estate portfolio, and he
is currently a Vice President of the managing general partner of such limited
partnership. He was a Trustee of BRT Realty Trust from 1984 to December 1996 and
Vice Chairman of its Board from March 1996 to December 1996.
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Harvey Sanders, age 51, has been President, Chief Executive Officer and a
Director of the Company since 1977 and Chairman of the Board since October 1993.

Charles H. Scherer, age 57, has been a Director of the Company since May
1994. He is managing partner of Hughes Hubbard & Reed LLP, an international law
firm which provides legal services to the Company.

John Varvatos, age 46, has been a director of the Company since April 2000.
He has served as Senior Vice President of the Company since September 1998 and
President of John Varvatos Company since October 1999. From July 1994 to August
1998, he was Senior Vice President of Men's Design for Polo/Ralph Lauren.

Ronald G. Weiner CPA, age 55, has been a Director of the Company since
October 1995. He is President of Perelson Weiner LLP, a certified public
accounting firm based in New York City.

Shares represented by proxies solicited by the Board of Directors will,
unless contrary instructions are given, be voted in favor of the election as
Directors of the nominees named above. If a stockholder wishes to withhold
authority to vote for any nominee, such stockholder can do so by following the
directions set forth on the form of proxy solicited by the Board of Directors or
on the ballot distributed at the Annual Meeting if such stockholder wishes to
vote in person. Directors shall be elected by a plurality vote of the shares of
Common Stock present in person or represented by proxy at the meeting.
Abstentions and broker non-votes will not have the effect of votes in opposition
to a person nominated as a Director.

During fiscal year 2001, the Board of Directors held eight meetings. The
Compensation Committee of the Board of Directors is comprised of Messrs. Bank
and Weiner. The Compensation Committee reviews the Company's compensation
policies and practices and develops recommendations with respect to compensation
for the Company's senior executives. The Audit Committee of the Board of
Directors is comprised of Messrs. Bank, Rosenzweig and Weiner. The Audit
Committee reviews the audit plan with the Company's independent accountants, the
scope and results of their audit and other related audit and accounting issues.
During fiscal year 2001, the Compensation Committee held two meetings and the
Audit Committee held three meetings. The Board of Directors as a whole proposes
nominees for election to the Board of Directors.

AUDIT COMMITTEE REPORT

The Audit Committee of the Board of Directors of the Company is comprised
of three independent directors and operates under a written charter annually
adopted by the Board of Directors, a copy of which is attached to this Proxy
Statement as Annex A.

In the performance of its oversight responsibility, the Audit Committee has
reviewed and discussed the audited financial statements of the Company for the
fiscal year ended March 3, 2001 with management of the Company. The Audit
Committee also has discussed with the independent auditors the matters required
to be discussed by the Statement on Auditing Standards No. 61, as amended
(Communication with Audit Committees).

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The Audit Committee has received the written disclosures and the letter
from the independent auditors required by Independence Standards Board Standard
No. 1 (Independence Discussions with Audit Committees), and has discussed with
the independent auditors the independent auditors' independence.

Based on the review and discussions described above with management and the
independent auditors, and subject to the limitations of our role, the Audit
Committee recommended to the Board of Directors that the financial statements
referred to above be included in the Company's Annual Report on Form 10-K for
the fiscal year ended March 3, 2001 and filed with the Securities and Exchange
Commission.

Submitted by the Audit Committee
of the Board of Directors

Robert B. Bank
Israel Rosenzweig
Ronald G. Weiner

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding ownership of
the Company's Common Stock as of May 23, 2001 by each nominee for Director, by
each of the executive officers of the Company included in the Summary
Compensation Table below, by all directors and executive officers as a group
and, as of the dates set forth in footnotes 4 and 5 below, by all stockholders
known to the Company to have been beneficial owners of more than five percent of
its Common Stock.

NAME OF AMOUNT BENEFICIALLY PERCENT OF
BENEFICIAL OWNER(1) OWNED(2)(3) CLASS(%)
------------------- ------------------- ----------

Robert B. Bank........................................... 32,000 *
Alexander Cannon......................................... 48,000 *
David Chu................................................ 1,600,416 4.7
George Greenberg......................................... 60,184 *
Paulette McCready........................................ 105,300 *
Israel Rosenzweig........................................ 20,000 *
Harvey Sanders........................................... 4,573,440 13.3
Charles H. Scherer....................................... 30,000 *
John Varvatos............................................ 58,000 *
Ronald G. Weiner......................................... 27,500 *
All Directors and Executive Officers as a group.......... 6,554,840 18.2

FMR Corp. and related parties(4)......................... 3,720,000 11.3
T. Rowe Price Associates, Inc.(5)........................ 2,007,600 6.1

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* Indicates holdings of less than 1%.

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(1) The address for each of the executives named in the table above is c/o
Nautica Enterprises, Inc., 40 West 57th Street, New York, New York 10019.

(2) Directly and indirectly. The inclusion of securities owned by others as
beneficially owned by the respective nominees and officers does not
constitute an admission that such securities are beneficially owned by them.
All of the named individuals have, except as set forth in Note 3 below, sole
voting and investment powers with respect to the aforesaid shares.

(3) Includes the following shares which may be acquired pursuant to existing
stock options which are exercisable on or before July 21, 2001: Robert B.
Bank -- 32,000; Alexander Cannon -- 48,000; David Chu -- 1,163,964; George
Greenberg -- 26,000; Paulette McCready -- 105,300; Israel Rosenzweig --
20,000; Harvey Sanders -- 1,437,000; Charles H. Scherer -- 29,000; John
Varvatos -- 58,000; and Ronald G. Weiner -- 20,000. With respect to Mr.
Sanders, includes 1,200,000 shares owned by the Harvey Sanders Grantor
Retained Income Trust. Such trust has sole voting and investment power with
respect to such shares.

(4) Information is based upon statements filed under Section 13 of the
Securities Exchange Act of 1934 reporting shareholdings as of December 31,
2000. In addition to FMR Corp., related parties on the filing are Fidelity
Management and Research Company, Edward C. Johnson 3d (Chairman of FMR
Corp.) and Abigail P. Johnson (Director of FMR Corp.) The reporting persons
have sole dispositive power with respect to all 3,720,000 shares; FMR Corp.
has sole voting power with respect to 71,000 shares. The address for FMR
Corp. and related parties is 82 Devonshire Street, Boston, Massachusetts
02109.

(5) Information is based upon statements filed under Section 13 of the
Securities Exchange Act of 1934 reporting shareholdings as of December 31,
2000. Includes 1,750,000 shares beneficially owned by T. Rowe Price New
Horizons Fund, Inc. ("Horizons"). T. Rowe Price Associates, Inc.
("Associates") serves as an investment advisor to Horizons. Associates is
deemed to have sole voting power with respect to 188,800 shares of the
Company and sole dispositive power with respect to 2,007,600 shares, and
Horizons is deemed to have sole voting power with respect to 1,750,000
shares. The address for Horizons and Associates is 100 East Pratt Street,
Baltimore, Maryland 21202.

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EXECUTIVE COMPENSATION AND OTHER INFORMATION

SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION

The following table shows, for the fiscal years ended March 3, 2001, March
4, 2000 and February 27, 1999 the cash compensation paid by the Company and its
subsidiaries, to the Company's Chief Executive Officer and each of the four most
highly compensated executive officers of the Company other than the Company's
Chief Executive Officer as of March 3, 2001.

SUMMARY COMPENSATION TABLE

LONG TERM
ANNUAL COMPENSATION
COMPENSATION AWARDS
----------------- ------------ ALL OTHER
SALARY BONUS OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) (#) ($)(1)
--------------------------- ---- ------- ------- ------------ ------------

Harvey Sanders............................... 2001 915,971 526,800 -- 2,956
Chairman of the Board, 2000 906,907 756,000 200,000 2,601
Chief Executive Officer and President 1999 846,022 727,900 200,000 2,554

David Chu.................................... 2001 811,115 421,400 -- 6,251
Executive Vice President and 2000 802,750 604,800 200,000 5,797
President/CEO -- Nautica International, 1999 814,730 582,500 200,000 5,569
Inc. and Nautica Apparel, Inc.,
wholly-owned subsidiaries of the Company

Alexander Cannon(2).......................... 2001 619,694 384,500 -- --
President -- Merchandising, 2000 601,000 300,000 100,000 --
Nautica International, Inc., a wholly-owned 1999 250,000 150,000 20,000 --
subsidiary of the Company

Paulette McCready............................ 2001 531,388 110,000 -- 2,550
President -- Nautica Jeans Company 2000 441,538 225,000 100,000 2,250
a wholly-owned subsidiary of the Company 1999 379,259 211,000 33,500 2,250

John Varvatos(3)............................. 2001 728,885 330,000 -- 3,135
President -- John Varvatos Company, 2000 663,500 330,000 125,000 --
a wholly-owned subsidiary of the Company 1999 277,923 300,000 20,000 --

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(1) "All Other Compensation" is comprised of contributions made by the Company
to the named executives pursuant to the Company's 401(k) Plan and, with
respect to Messrs. Sanders and Chu in 2001, 2000 and 1999, and Mr. Varvatos
in 2001, the following additional amounts representing the economic value
attributable to each of them for split-dollar life insurance: Mr.
Sanders -- $406, $351 and $304; Mr. Chu -- $3,701, $3,547 and $3,319; and,
Mr. Varvatos -- $3,135.

(2) Mr. Cannon joined the Company in October 1998.

(3) Mr. Varvatos joined the Company in September 1998 as Senior Vice President,
became President of John Varvatos Company in October 1999, and was elected
to the Board of Directors in April 2000.

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OPTION EXERCISES AND HOLDINGS

The following table sets forth information with respect to the Company's
executives listed in the Summary Compensation Table above, concerning the
exercise of options during the last fiscal year and unexercised options held as
of the end of the 2001 fiscal year:

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES

NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT FY-END(#) AT FY-END($)
ACQUIRED ON VALUE ------------------------- -------------------------
NAME EXERCISE(#) REALIZED($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- ----------- ----------- ------------------------- -------------------------

Harvey Sanders................. -- -- 1,282,000/390,000 11,163,361/1,065,280
David Chu...................... 400,000 3,527,000 1,008,964/390,000 8,219,063/1,065,280
Alexander Cannon............... -- -- 28,000/ 92,000 133,160/ 532,640
Paulette McCready.............. -- -- 68,800/114,900 178,538/ 532,640
John Varvatos.................. -- -- 33,000/112,000 166,450/ 665,800

DIRECTOR COMPENSATION

During fiscal year 2001, each non-employee Director received compensation
of $2,000 for each Board and committee meeting attended, and an annual fee of
$20,000. No fees are payable to officers and employees of the Company who serve
as Directors.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Company and Messrs. Sanders and Chu have entered into an agreement that
provides that upon the death of either of them, the Company will purchase a
portion of the shares of Common Stock of such stockholder. The Company has
obtained policies of life insurance on the lives of such stockholders for the
purpose of utilizing the proceeds from such insurance for the purchase of the
shares. The agreement provides for the Company to purchase the shares of the
deceased stockholder at a value which is equal to the average of the last sale
price as reported on the National Market List of the NASDAQ (or the closing
price if the shares are listed on a national securities exchange) for the thirty
trading days prior to the date of death of the deceased stockholder. The
Company's obligation to purchase the Common Stock of the deceased stockholder is
limited to the life insurance proceeds received by the Company on the death of
such stockholder. The agreement also provides, as soon after the death of the
stockholder as is practicable, for the filing of a registration statement with
the Securities and Exchange Commission for a secondary offering to provide for
the sale of the balance of the shares owned by the deceased stockholder.

Mr. David Chu, Executive Vice President of the Company and President of
Nautica Apparel, Inc. and Nautica International, Inc., both wholly-owned
subsidiaries of the Company, is entitled to receive 50% of the net income
Nautica Apparel, Inc. receives from all royalty income earned with respect to
the Nautica name and trademarks. For the year ended March 3, 2001, Mr. Chu
earned net royalty income of $8,779,431. Through a separate arrangement, Mr. Chu
is entitled to receive, subject to certain conditions, a design fee of

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up to 1.5% of the net sales of certain new products. For the year ended March 3,
2001, Mr. Chu received payments of $1,203,393 based upon the net sales of such
products.

During fiscal year 2001, the Company paid $1,596,077 to the law firm of
Hughes Hubbard & Reed LLP for professional services rendered to the Company.
Samuel Sultanik, Esq., the brother-in-law of Harvey Sanders, Chairman of the
Board, Chief Executive Officer and President of the Company, is a partner of
Hughes Hubbard & Reed LLP and Charles H. Scherer, Esq., a Director of the
Company, is managing partner of Hughes Hubbard & Reed LLP.

During fiscal year 2001, the Company paid $237,746 to the firm of
Chu/Pettersen Interior Design, Inc. for interior design and related services
provided to the Company. Mr. Peter Chu, the brother of David Chu, Executive Vice
President of the Company, is a stockholder and Vice President in such firm.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent of
its Common Stock to file reports of ownership and changes in ownership with the
Securities and Exchange Commission (the "Commission"). Officers, directors and
greater than ten percent stockholders are required by the Commission to furnish
the Company with copies of all Section 16(a) forms they file.

The Company believes that, based solely on its review of the copies of such
forms received by it, or written representations from certain reporting persons
that no reports on Form 5 were required for those persons, during fiscal year
2001 all filing requirements applicable to its officers, directors and greater
than ten percent stockholders were complied with.

EMPLOYEE CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS

The Company has entered into agreements with Messrs. Sanders, Chu and
Varvatos providing that in the event of a change in control of the Company, as
defined in the agreements, each has the right to receive a lump sum payment upon
termination of employment other than for cause or permanent disability or
resignation for good reason within three years after the change in control. At
March 3, 2001, the maximum amount payable to Mr. Sanders, Mr. Chu and Mr.
Varvatos under such agreements was $4,319,700, $3,754,200 and $3,206,100,
respectively.

The Company has entered into split-dollar agreements with trusts
established by each of Mr. Sanders and Mr. Chu, and with Mr. Varvatos. Pursuant
to each of the agreements, the Company pays the annual premium on specified life
insurance policies owned by each of the trusts and by Mr. Varvatos, net of the
amount of the "economic benefit" attributable to each of the employees. The
amount of the premiums paid by the Company constitutes indebtedness from each of
the trusts and Mr. Varvatos to the Company and is secured by collateral
assignments of each of the insurance policies to the Company. The annual premium
payable by the Company for the benefit of Mr. Sanders' trust is $57,232, for Mr.
Chu's trust, $48,113 and for Mr. Varvatos, $89,336. Upon termination of each of
the agreements, the Company is entitled to receive from each of the trusts the
amount equal to the aggregate premiums which it has paid. The face value of the
policy for Mr. Sanders' trust is $5,000,000, for Mr. Chu's trust, $4,950,000 and
for Mr. Varvatos, $5,000,000.

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The Company has entered into an employment agreement with Mr. Varvatos
which provides for continued service by Mr. Varvatos in his present position as
President of John Varvatos Company ("JVC") until February 28, 2002, subject to
extension for additional three year segments unless either the Company or Mr.
Varvatos provides notice of non-extension. During fiscal year 2002, Mr. Varvatos
is entitled to receive a salary of $735,000. Thereafter, any increases are
determined by the Board of Directors, subject to a minimum increase of no less
than 5%. Mr. Varvatos is entitled to annual bonuses in accordance with the
Company's policies in effect from time to time. The employment agreement
includes the change in control provisions set forth above and provides that if
during the term of employment Mr. Sanders is no longer employed by the Company
then the Company shall exercise one of the following options: (i) spin-off to
the Company's shareholders the shares of JVC with Mr. Varvatos serving as its
Chief Executive Officer; (ii) sell JVC to Mr. Varvatos at fair market value, or
(iii) pay to Mr. Varvatos an annual amount equal to 10% of JVC's net income
(after taxes) for so long as he remains JVC's Chief Executive Officer. The
Company can elect to cease making the annual payments provided for in clause
(iii) above by making a lump sum payment to the executive in an amount equal to
two times the JVC average annual net income (after taxes) for the prior three
years; provided, however, such sum shall not exceed $50 million. Mr. Varvatos
has assigned to the Company all of his right, title and interest in and to the
names John Varvatos, Varvatos and John Varvatos Company, and any derivations
thereof.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

Robert B. Bank and Ronald G. Weiner serve as members of the compensation
committee (the "Compensation Committee") of the Board of Directors.

COMPENSATION COMMITTEE REPORT

The Compensation Committee of the Board of Directors consists of two
non-employee directors. The Compensation Committee reviews the Company's
executive compensation policies and practices and develops recommendations to
the Board with respect to compensation for the Company's senior executives. In
fiscal year 1998, the Board adopted an executive compensation program to provide
a framework for administering the Company's executive compensation program. The
Committee also administers the Company's Incentive Compensation Plan and the
1996 Stock Incentive Plan.

The goals of the Company's compensation policies are as follows:

- to attract, retain, reward and motivate executive officers and employees
by establishing compensation levels generally competitive with the
marketplace;

- to align executive compensation with the Company's business objectives;

- to position compensation to reflect the individual's performance as well
as the level of responsibility, skill and strategic value of the
executive; and

- to align the interests of the Company's employees with those of its
stockholders.

In setting compensation, the Compensation Committee reviews, with the
assistance of independent compensation consultants, available information for
similar positions or levels at comparable companies. Such companies include a
diverse range of apparel manufacturers with sales within, below and above the
range of
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sales of the Company. The Compensation Committee has adopted a policy to seek to
maintain executive compensation within the deduction cap of Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code").

The Company's executive compensation program consists of three main
components: base salary, cash bonus or incentive awards, and long-term
stock-based incentives. Base salaries are determined with reference to a
competitive norm and job grades with consideration given to the executive's
strategic value, experience, proficiency and performance. Ranges of salary are
assigned to each grade with a minimum salary representing the lowest entry
level, a midpoint salary representing a market value of experienced good
performers and a maximum salary representing the highest value for the most
experienced and proficient employees. Cash bonuses to eligible employees are
based upon a formula to provide a direct "pay-for-performance" vehicle. The
annual bonus also serves to focus executives on those activities that most
directly affect shareholder value which are within their control and for which
they are held accountable. At the beginning of the fiscal year, specific
performance measures and goals are established based upon corporate and/or
business unit profitability and individual performance. Each participant is
assigned a target bonus award opportunity that relates to his or her level. That
target award level represents the level of bonus payment the participant can
expect to earn in the event all performance goals are achieved at 100% during
the ensuing fiscal year. When performance levels exceed or fall below
expectations, actual awards are proportionately increased or decreased from the
target, with bonuses "at risk." In fiscal year 2001, the target levels
established at the corporate and business unit levels were based upon earnings
before income taxes.

With respect to certain senior executives, including Harvey Sanders, the
Chairman of the Board, President and Chief Executive Officer of the Company,
David Chu, the Executive Vice President of the Company, Alex Cannon,
President -- Merchandising of Nautica International, Inc., a wholly-owned
subsidiary of the Company, and John Varvatos, President of John Varvatos
Company, a wholly-owned subsidiary of the Company, annual incentive award
opportunities are set in accordance with the Company's Incentive Compensation
Plan (the "Plan"). At the start of each fiscal year, the Compensation Committee,
in consultation with management, establishes target levels of either earnings
before income taxes, net earnings and/or return on equity for the Company or a
business unit. In fiscal year 2001, threshold levels of earnings were
established. If the designated minimum level of earnings was not achieved, the
participants would have received no incentive award for fiscal year 2001
performance under the Plan (although in its discretion, the Compensation
Committee could have authorized an award outside of the Plan). During such year,
the minimum threshold level was exceeded and the participants received an
incremental proportionately greater payment than the minimum. The Compensation
Committee has established target levels for fiscal year 2002 based on earnings
and has granted incentive award opportunities for such year to each of Messrs.
Sanders, Chu, Cannon and Varvatos.

The Company's senior executives are eligible to receive stock options
and/or restricted stock in accordance with the Company's 1996 Stock Incentive
Plan. The objectives of such participation are to align executive and
stockholder long term interests and to enable executives to develop a stock
ownership position in the Company. The Compensation Committee has the
responsibility of granting stock options and restricted stock awards to
executive and management employees. In granting stock options, the Compensation
Committee takes into account Company performance, subsidiary performance and
individual performance, utilizing the same factors as those used in the
determination of cash compensation. The Compensation

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Committee also takes into account the number of options held by an individual
and the total number of stock options outstanding. No stock options were granted
to senior executives in fiscal year 2001.

The Chairman of the Board, President and Chief Executive Officer of the
Company is Harvey Sanders. The criteria by which the Compensation Committee
determines salary, bonus and the grant of stock options for senior executives,
as set forth above, is also utilized by the Compensation Committee in
determining cash compensation and stock option awards for Mr. Sanders.

Compensation Committee

Robert B. Bank
Ronald G. Weiner

PERFORMANCE GRAPH

The following performance graph assumes $100 invested in Nautica
Enterprises, Inc. Common Stock, the NASDAQ Stock Market (U.S.) and S&P Textiles
Index on March 1, 1996. Where applicable, it assumes reinvestment of dividends.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
NAUTICA ENTERPRISES, INC., NASDAQ STOCK MARKET (U.S.) AND
S&P TEXTILES INDEX FOR THE FIVE YEARS ENDED FEBRUARY 28, 2001

Year Nautica Enterprises, Inc. S&P Textiles Index Nasdaq Stock Market (U.S.)
---- ------------------------- ------------------ ---------------------------

1996 100.00 100.00 100.00
1997 121.95 140.21 119.30
1998 140.55 156.89 163.00
1999 73.17 124.45 212.32
2000 55.49 81.32 453.66
2001 87.50 115.67 194.52

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APPOINTMENT OF ACCOUNTANTS

The Board of Directors has selected Grant Thornton LLP as the Company's
independent accountants who will make an examination of the accounts of the
Company for the year ending March 2, 2002. A representative of Grant Thornton
LLP is expected to be present at the annual meeting to respond to appropriate
questions and to make a statement if that representative so desires.

AUDIT AND OTHER FEES:

For fiscal 2001, Grant Thornton LLP billed the Company for various audit
and non-audit services, as follows:

Audit Fees. The aggregate fees billed by Grant Thornton LLP for
professional services rendered in connection with such firm's audit of the
Company's fiscal 2001 financial statements, including the review of the
financial statements included in the Company's Quarterly Reports on Form 10-Q
for such fiscal year, were $248,500.

Financial Information Systems Design and Implementation Fees. During the
2001 fiscal year, Grant Thornton LLP did not perform any professional services
for the Company relating to financial information systems design and
implementation.

All Other Fees. The aggregate fees billed by Grant Thornton LLP for all
other services rendered to the Company in connection with the 2001 fiscal year
were $628,212, which included fees for tax-related services and special
projects. The Audit Committee of the Board of Directors has considered whether
provision of these non-audit services by Grant Thornton LLP is compatible with
maintaining the independent public accountants' independence.

PROPOSALS BY STOCKHOLDERS-2002 ANNUAL MEETING

All proposals by stockholders intended to be presented at the next annual
meeting of stockholders (scheduled to be held in July 2002) must be received by
the Company at its office at 40 West 57th Street, New York, New York 10019, no
later than February 11, 2002 in order to be included in the Proxy Statement and
form of proxy relating to such meeting. All such proposals must comply with
applicable Securities and Exchange Commission rules and regulations.

OTHER BUSINESS

Management is not aware of any matters to be presented at the meeting other
than those set forth in this Proxy Statement. However, should any other business
properly come before the meeting, or any adjournment or adjournments thereof,
the enclosed proxy confers upon the persons entitled to vote the shares
represented by such proxies, discretionary authority to vote the same in respect
to any such other business in accordance with their best judgment in the
interest of the Company.

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15

MANAGEMENT UNDERTAKES TO PROVIDE ITS STOCKHOLDERS WITHOUT CHARGE, UPON
WRITTEN OR VERBAL REQUEST BY ANY SUCH STOCKHOLDER BY FIRST CLASS MAIL WITHIN ONE
BUSINESS DAY OF RECEIPT OF SUCH REQUEST, A COPY OF THE COMPANY'S ANNUAL REPORT
ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULE FILED THEREWITH.
WRITTEN REQUEST FOR SUCH REPORT SHOULD BE ADDRESSED TO MORGEN-WALKE ASSOCIATES,
INC., 380 LEXINGTON AVENUE, 50TH FLOOR, NEW YORK, NEW YORK 10168-5199. VERBAL
REQUESTS SHOULD BE MADE BY TELEPHONE TO SUCH COMPANY AT (212) 850-5600.

Stockholders are urged to vote the enclosed proxy, solicited on behalf of
the Board of Directors, or vote by telephone or the via the Internet. Unless a
contrary direction is indicated, proxies will be voted for the election as
directors of the nominees listed in this Proxy Statement. The proxy does not
affect the right to vote in person at the meeting and may be revoked by the
stockholder any time prior to its being voted.

By Order of the Board of Directors,

HARVEY SANDERS,
Chairman

June 8, 2001

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ANNEX A

CHARTER OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
OF NAUTICA ENTERPRISES, INC.

The Board of Directors (the "Board") of Nautica Enterprises, Inc. (the
"Company") has constituted and established an Audit Committee (the "Committee")
with authority, responsibility, and specific duties as described in this Audit
Committee Charter.

COMPOSITION

The members of the Committee shall meet the independence and experience
requirements of the NASDAQ Stock Market. The Committee shall be comprised of at
least three directors, the members of which shall be appointed by the Board.

PRINCIPAL FUNCTIONS

The Committee shall assist the Board in monitoring (1) the integrity of the
financial statements of the Company, (2) the compliance by the Company with
legal and regulatory requirements, and (3) the independence and performance of
the Company's internal and external auditors. As such, the Committee shall have
the authority to retain special legal, accounting or other consultants to advise
the Committee. The Committee may request any officer or employee of the Company
or the Company's outside counsel or independent auditor to attend a meeting of
the Committee or to meet with any members of, or consultants to, the Committee.

The Committee's principal audit functions shall include the following:

- Review and reassess the adequacy of this Charter annually and recommend
any proposed changes to the Board for approval.

- Recommend to the Board the appointment of the independent auditor, which
firm is ultimately accountable to the Committee and the Board, as
representatives of the Company's stockholders.

- Approve the fees and other significant compensation to be paid to the
independent auditor.

- Receive periodic reports from the independent auditor regarding the
auditor's independence consistent with Independence Standards Board
Standard No. 1, which requires that auditors discuss with the Committee
any significant relationship that could impair their independence,
discuss such reports with the auditor, and if so determined by the
Committee, take or recommend that the full Board take appropriate action
to oversee the independence of the auditor.

- Evaluate, together with the Board, the performance of the independent
auditor and, if so determined by the Committee, recommend that the Board
replace the independent auditor (or recommend that the outside auditor be
proposed for stockholder approval in any proxy statement).

- Review the planning of the independent audit and any special audit
procedures required.

A-1
17

- Review the results of the external audit of the Company's financial
statements, the independent auditor's opinion, any related management
letter, management's responses to recommendations made by the independent
auditor in connection with the audit, reports submitted to the Committee
by the Company's chief financial officer, and management's responses to
those reports.

- Review with management and the independent auditor the Company's
quarterly financial statements prior to the filing of its Form 10-Q.

- Review the Company's annual financial statements prior to filing of its
Form 10-K, and discuss with management and the independent auditor any
significant issues regarding accounting principles, practices and
judgments.

- Obtain from the independent auditor assurance that Section 10A (Audit
Requirements) of the Securities and Exchange Act of 1934 has not been
implicated.

- Review the appointment and replacement of the senior internal audit
executive.

- Review the significant reports to management prepared by the internal
auditing department and management's responses.

- Review, in consultation with the independent auditor and the Company's
chief financial officer, the adequacy of the Company's internal financial
controls.

- Approve for recommendation to the Board any material changes and other
material questions regarding the appropriate accounting principles and
practices to be followed when preparing the Company's financial
statements.

- Prepare the report required by the rules of the Securities and Exchange
Commission to be included in the Company's annual Proxy Statement.

- Such other oversight duties and responsibilities as may be assigned to
the Committee, from time to time, by the Board and/or Chairman of the
Board.

MEETINGS

The Committee will meet as often as necessary to carry out its
responsibilities. Meetings may be called by the Chairman of the Committee, the
Chief Executive Officer of the Company or any member of the Committee. In
addition, the Committee will make itself available to the independent auditors
of the Company as requested by such independent auditors. All meetings of the
Committee shall be held pursuant to the Bylaws of the Company with regard to
notice and waiver thereof, and written minutes of each meeting shall be duly
filed in the Company's records. Reports of meetings of the Committee shall be
made to the Board at its next regularly scheduled meeting following the
Committee meeting accompanied by any recommendations to the Board approved by
the Committee.

LIMITATION OF RESPONSIBILITIES

While the Committee has the responsibilities and powers set forth in this
Charter, it is not the duty of the Committee to plan or conduct audits or to
determine that the Company's financial statements are complete

A-2
18

and accurate and are in accordance with generally accepted accounting
principles. This is the responsibility of management and the independent
auditor. Nor is it the duty of the Committee to conduct investigations, to
resolve disagreements, if any, between management and the independent auditor or
to assure compliance with laws and regulations and the Company's Code of
Conduct.

APPROVAL

This Charter was approved by the Board on April 28, 2000.

A-3
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Please cast _____
your vote as X
indicated in _____
this example

For Withheld
All All
1. ELECTION OF DIRECTORS ________ ________ In their discretion, the Proxies are authorized to vote
Nominees: upon such other business as may properly come before
01 Robert B. Bank 02 David Chu ________ ________ the meeting.
03 George Greenberg 04 Israel Rosenzweig
05 Harvey Sanders 06 Charles H. Scherer THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE
07 John Varvalos 08 Ronald G. Weiner MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
INSTRUCTION: To withhold authority to vote for PROPOSAL "1".
any individual nominee, write that nominee's
name in the blank space below.

______________________________________________ _____
CHECK HERE IF CHANGE OF ADDRESS
______________________________________________ _____

Signature__________________________________________________Signature______________________________________________Date:_____________
Please sign exactly as your name or names appear hereon. When shares are held by joint tenants, both should sign. When signing as
attorney, as executor, administrator, trustee or guardian, please give full name as such. If a corporation, please sign in full
corporate name by President or other authorized officer. If a partnership, please sign in partnership name by authorized person.
------------------------------------------------------------------------------------------------------------------------------------
+ FOLD AND DETACH HERE +

Vote by Internet or Telephone or Mail
24 Hours a Day, 7 Days a Week

Internet and telephone voting is available through 4PM Eastern Time
the business day prior to annual meeting day.

Your telephone or Internet vote authorizes the named proxies to vote your shares in the same manner
as if you marked, signed and returned your proxy card.

_________________________________________ _________________________________________ _________________________________________
Internet Telephone Mail
http://www.proxyvoting.com/naut 1-800-840-1208

Use the Internet to vote your proxy. Use any touch-tone telephone to vote Mark, sign and date
Have your proxy card in hand when your proxy. Have your proxy card in your proxy card
you access the web site. You will be OR hand when you call. You will be OR and
prompted to enter your control prompted to enter your control return it in the
number, located in the box below, number, located in the box below, enclosed postage-paid
to create and submit an electronic and then follow the directions envelope.
ballot. given.
_________________________________________ ________________________________________ ________________________________________

If you vote by telephone or the Internet, DO NOT mail back this proxy card.
Proxies submitted by telephone or the Internet must be received by 4:00 pm Eastern Time,
on July 9, 2001.

20
PROXY PROXY

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF
NAUTICA ENTERPRISES, INC.
PROXY -- ANNUAL MEETING OF STOCKHOLDERS, JULY 10, 2001

The undersigned nearby appoints Harvey Sanders and David Chu, and each of
them, proxies and attorneys-in-fact of the undersigned, with the power to
appoint his substitute, and hereby authorizes them to represent and to vote, as
designated below, all the shares of common stock of Nautica Enterprises, Inc.
held of record by the undersigned on May 30, 2001 at the Annual Meeting of
Stockholders to be held on July 10, 2001 or any adjournment thereof.

(Continued and to be signed on reverse side.)

................................................................................
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