sec document

DEF 14A 1 schedule14a03733_06152001.htm DEFINTIVE PROXY sec document

SCHEDULE 14A
(RULE 14A-101)

INFORMATION REQUIRED IN PROXY STATEMENT

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 Rule 14(a)-12

EVERLAST WORLDWIDE INC.
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(Name of Registrant as Specified in Charter)

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

Payment of filing fee (check the appropriate box):

/X/ No fee required.

/ / Fee computed on table below per Exchange Act Rules
14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction
applies:

--------------------------------------------------------------------------------

(2) Aggregate number of securities to which transaction
applies:

--------------------------------------------------------------------------------

(3) 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):

--------------------------------------------------------------------------------

(4) Proposed maximum aggregate value of transaction:

(5) Total fee paid:

/ / Fee paid previously with preliminary materials.

/ / 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.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement no.:

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(3) Filing Party:

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(4) Date Filed:

-2-

EVERLAST WORLDWIDE INC.
1350 BROADWAY, SUITE 2300
NEW YORK, NEW YORK 10018

NOTICE OF 2001 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD JUNE 15, 2001

NOTICE IS HEREBY GIVEN that the 2001 Annual Meeting of
Stockholders (the "Annual Meeting") of Everlast Worldwide Inc. (the "Company")
will be held on Friday, June 15, 2001 at 10:00 AM, local time, at The Kitano, 66
Park Avenue (at 38th Street), New York, New York 10016, in the Park Avenue Room
on the 18th floor, for the following purposes.

1. To elect five members of the Board of Directors to serve
until the next Annual Meeting at which their successors
are elected and qualify.

2. To ratify the selection of Berenson & Company LLP as the
Company's independent auditors.

3. To transact such other business as may properly come
before the Annual Meeting and any adjournments thereof.

The Board of Directors has fixed the close of business on April
30, 2001 as the record date for the determination of the Company's shares of
common stock, par value $.002 per share, and shares of Class A common stock, par
value $.01 per share, entitled to notice of, and to vote at the Annual Meeting
or any adjournments thereof.

By Order of the Board of Directors

George Q Horowitz
President and Chief Executive Officer

Dated: April 30, 2001
New York, New York

IMPORTANT

WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON, WE URGE YOU TO
SIGN, DATE AND RETURN THE ENCLOSED PROXY AT YOUR EARLIEST CONVENIENCE TO ENSURE
THE PRESENCE OF A QUORUM AT THE ANNUAL MEETING. A SELF-ADDRESSED STAMPED
ENVELOPE IS ENCLOSED FOR THAT PURPOSE. IF YOU SEND IN YOUR PROXY AND THEN DECIDE
TO ATTEND THE ANNUAL MEETING TO VOTE YOUR STOCK IN PERSON, YOU MAY STILL DO SO.
YOUR PROXY IS REVOCABLE AT YOUR REQUEST.

EVERLAST WORLDWIDE INC.
1350 BROADWAY, SUITE 2300
NEW YORK, NEW YORK 10018

PROXY STATEMENT

INFORMATION CONCERNING SOLICITATION AND VOTING

This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors (the "Board of Directors") of
Everlast Worldwide Inc. (the "Company") to be voted at the 2001 Annual Meeting
of Stockholders to be held on Friday, June 15, 2001 at 10:00 AM, local time, at
The Kitano, 66 Park Avenue (at 38th Street), New York, New York 10016, in the
Park Avenue Room on the 18th floor, and at any adjournments thereof (the "Annual
Meeting") for the purposes set forth in the accompanying Notice of 2001 Annual
Meeting of Stockholders.

The approximate date on which the enclosed form of proxy and
this Proxy Statement are first being sent to stockholders is May 3, 2001.

When a proxy is returned properly signed, the shares
represented thereby will be voted by the proxies in accordance with the
stockholder's directions. If the proxy is signed and returned without choices
having been specified, the shares will be voted for the nominees of the Board of
Directors as directors of the Company and for the ratification of the selection
of Berenson & Company LLP as the Company's independent auditors. If for any
reason any of the nominees of the Board of Directors shall become unavailable
for election, the proxies may use their discretionary authority to vote for
substitutes proposed by the Board of Directors.

A stockholder giving a proxy has the right to revoke it at any
time before it is voted by sending a written notice of revocation to the
Secretary of the Company, by sending a duly executed later-dated proxy, or by
requesting the return of the proxy at the Annual Meeting and voting in person.

Only stockholders of record at the close of business on April
30, 2001 (the "Record Date") are entitled to notice of, and to vote at the
Annual Meeting. As of the Record Date, there were outstanding 2,998,936 shares
of the Common Stock, $.002 par value per share of the Company (the "Common
Stock") and there were 100,000 shares of the Company's Class A Common Stock,
$.01 par value per share (the "Class A Stock"). Each share of Common Stock and
each share of Class A Stock is entitled to one vote and five votes,
respectively, at the Annual Meeting.

The holders of a majority of the outstanding shares of Common
Stock and Class A Stock, combined, whether present in person or represented by
proxy, will constitute a quorum for each of the matters identified in the Notice
of the 2001 Annual Meeting of Stockholders. Broker "non-votes" and the shares as
to which a stockholder abstains are included for purposes of determining whether
a quorum is present at the Annual Meeting. A broker "non-vote" occurs when a
nominee holding shares for a beneficial owner does not vote on a particular
proposal because the nominee does not have the discretionary voting power with
respect to that item and has not received instructions from the beneficial
owner. Proxies marked as abstaining with respect to the proposal to ratify the
appointment of independent auditors will have the effect of a vote against such
proposal.

A plurality of votes cast is required to elect directors and to
ratify the appointment of Berenson & Company LLP. Broker "non-votes" and
abstentions are not included in the tabulation of the voting results on the
election of directors and ratification of the independent auditors, and,
therefore, do not have the effect of votes in opposition in such tabulations.
Brokers that do not receive instructions from the stockholders, however, are
entitled to vote on the election of directors and the ratification of the
independent auditors.

The cost of solicitation of proxies will be borne by the
Company. In addition to the solicitation of proxies by use of the mails, some of
the officers, directors and regular employees of the Company, without extra
remuneration, may solicit proxies personally or by telephone, telefax or similar
transmission. The Company will reimburse record holders for expenses in
forwarding proxies and proxy soliciting material to the beneficial owners of the
shares held by them.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information with respect
to the beneficial ownership of the Company's Common Stock and Class A Common
Stock as of April 30, 2001 for (i) each of the Company's directors (ii) each of
the Company's executive officers (iii) each stockholder known to be the
beneficial owner of more than five percent of any class of the Company's voting
securities and (iv) all directors and executive officers as a group. Unless
otherwise indicated, (i) each stockholder has sole voting power and dispositive
power with respect to the indicated shares and (ii) the address of each
stockholder is c/o the Company, 1350 Broadway, Suite 2300, New York, New York
10018.

Beneficial Ownership Common and
Class A Common (1)
Percentage of
Name and Address of Beneficial Owner Number (2) Outstanding Stock
------------------------------------ ---------- -----------------

George Q Horowitz 1,152,628(3) 28.4%
Ben Nadorf 455,700(4)(9) 13.0%
James K. Anderson 109,712(5) 3.1%
4903 163rd Ave., N.E.
Redmond, WA 98052
Rita Cinque-Kriss 112,700(6) 3.2%

Larry Kring 42,456(7) 1.2%
3265 126th Ave., N.E.
Bellevue, WA 98005
Edward R. Epstein 13,900(8) *
915 Middle River Drive
Suite 419
Fort Lauderdale, FL 33304
Wayne Nadorf 1,200(9) *

Angelo Giusti 8,700(10) *

Matthew Mark 1,500(11) *

All directors and 1,897,296 45.6%
executive officers as a group (9 persons) (3)(4)(5)(6)(7)
(8)(10)(11)
-----------------------------
Less than one percent.

(1) Under rules adopted by the Securities and Exchange Commission, a person
is deemed to be a beneficial owner of securities with respect to which
such person has or shares: (i) voting power, which includes the power
to vote or direct the vote of the security, or (ii) investment power,
which includes the power to dispose of or to direct the disposition of
the security. Unless otherwise indicated

below, the persons named in the table above have sole voting and
investment power with respect to all shares beneficially owned.

(2) As of April 30, 2001, there were outstanding 2,998,936 shares of Common
Stock and 100,000 shares of Class A Common Stock. The shares of Class A
Common Stock are entitled to five votes per share. Thus, while there
are 3,098,936 total shares outstanding (not including any unexercised
options), the maximum number of votes that could be cast is 3,498,936.

(3) Consists of (i) 487,628 shares of Common Stock (ii) 100,000 shares of
Class A Common Stock and (iii) 565,000 shares of Common Stock issuable
upon exercise of options exercisable currently or within 60 days,
including (A) options to purchase 125,000 shares granted by the Company
at the exercise price of $4.00 per share, which expire October 24,
2010; (B) options to purchase 380,000 shares granted by the Company at
the exercise price of $13.00 per share, which expire October 24, 2010.
(C) options to purchase 15,000 shares granted by the Company at the
exercise price of $2.23 per share, which expire on November 3, 2005,
(D) options to purchase 25,000 shares at an exercise price $2.23 per
share, which expire on November 7, 2006, (E) options to purchase 13,333
shares at an exercise price of $3.97 per share, which expire March 22,
2009, and (F) options to purchase 6,667 shares at an exercise price of
$2.23 per share, which expire December 31, 2009. Mr. Horowitz has
agreed not to vote the shares underlying the options in (A) and (B)
above, if exercised, as long as there are at least $10million of Series
A Preferred Stock outstanding.

(4) Includes 1,400 shares of Common Stock held by Sue Nadorf, the spouse of
Mr. Ben Nadorf.

(5) Consists of (i) 86,350 shares of Common Stock of which Mr. Anderson
owns 44,300 shares of Common Stock with his wife, as joint tenants, and
(ii) 23,362 shares of Common Stock issuable upon exercise of options
excercisable currently or within 60 days, including

(A) 839 shares @ $1.75 expires December 31, 2004
(B) 839 shares @ $3.00 expires December 31, 2004
(C) 839 shares @ $5.00 expires December 31, 2004
(D) 839 shares @ $6.25 expires December 31, 2004
(E) 4,706 shares @ $0.85 expires December 31, 2003
(F) 3,200 shares @ $2.23 expires November 3, 2002
(G) 3,200 shares @ $2.23 expires January 2, 2003
(H) 3,100 shares @ $2.23 expires January 3, 2004
(I) 2,600 shares @ $3.59 expires January 2, 2005
(J) 2,133 shares @ $9.38 expires January 3, 2006
(K) 1,067 shares @ $2.23 expires January 2, 2007

(6) Consists of (i) 77,200 shares of Common Stock and (ii) 35,500 shares of
Common Stock issuable upon exercise of options exercisable currently or
within 60 days including (A) options to purchase 10,500 shares of
Common Stock at an exercise price of $2.23 per share, which expire on
November 3, 2005 and (B) 15,000 shares of Common Stock at an exercise
price of $2.23 per share, which expire on December 13, 2006 (C) 6,667
shares of Common Stock, at an exercise price of $3.97 per share which
expire March 22, 2009, and (D) 3,333 shares of Common Stock, at an
exercise price of $2.23 per share which expire December 31, 2009.

(7) Consists of (i) 20,338 shares of Common Stock and (ii) 22,118 shares of
Common Stock issuable upon the exercise of options currently
exercisable or within 60 days, including

(A) 839 shares @ $1.75 expires December 31, 2004
(B) 839 shares @ $3.00 expires December 31, 2004
(C) 839 shares @ $5.00 expires December 31, 2004
(D) 839 shares @ $6.25 expires December 31, 2004
(E) 3,762 shares @ $0.85 expires December 31, 2003
(F) 3,100 shares @ $2.23 expires November 3, 2002
(G) 3,100 shares @ $2.23 expires January 2, 2003
(H) 3,100 shares @ $2.23 expires January 3, 2004
(I) 2,600 shares @ $3.59 expires January 2, 2005
(J) 2,067 shares @ $9.38 expires January 3, 2006
(K) 1,033 shares @ $2.23 expires January 2, 2007

(8) Consists of (i) 12,000 shares of Common Stock, and (ii) 11,900 shares
of Common Stock issuable upon exercise of options exercisable currently
or within 60 days, including (A) options to purchase 3,000 shares of
Common Stock at an exercise price of $2.23 per share, which expire on
January 2, 2003 and (B) options to purchase 3,000 shares of Common
Stock at an exercise price of $2.23 per share, which expire on January
3, 2004, (C) 2,700 shares of Common Stock at an exercise price of $3.59
which expire January 2, 2005, (D) 2,133 shares at an exercise price of
$9.38 which expire January 3, 2006, and (E) 1,067 shares at an exercise
price of $2.23 which expire December 31, 2009.

(9) Held jointly with Sue Nadorf, Mr. Wayne Nadorf's mother.

(10) Consists of (i) 700 shares of Common Stock and (ii) 7,167 shares of
Common Stock issuable upon exercise of options exercisable currently or
within 60 days, including (A) options to purchase 3,000 shares of
Common Stock at an exercise price of $2.23 per share, which expire on
January 3, 2004 and (B) options to purchase 1,667 shares of Common
Stock at an exercise price of $2.094 per share, which expire on June 6,
2008, (C) 2,500 shares of Common Stock at an exercise price of $3.97
which expire March 22, 2009, and (D) 833 shares of Common Stock at an
exercise price of $2.23 which expire December 31, 2009.

(11) Consists of 1,500 shares of Common Stock issuable upon exercise of
options exercisable currently or within 60 days, including (A) 667
shares of Common Stock at an exercise price of $3.97 which expire March
22, 2009, and (B) 833 shares of Common Stock at an exercise price of
$2.23 which expire December 31, 2009.

PROPOSAL 1 -- ELECTION OF DIRECTORS

Five director will be elected at the Annual Meeting each to
serve for a one-year term until the 2002 Annual Meeting of Stockholders and
until their successors are elected and qualified. If no contrary instructions
are indicated, proxies received by the Company will be voted for the election of
five nominees of the Board of Directors listed below. All of the nominees
currently serve as directors of the Company. The Company does not expect that
any of the nominees will be unavailable for election, but if that should occur
before the Annual Meeting, the proxies will be voted in favor of the remaining
nominees and may also be voted for a substitute nominee or nominees selected by
the Board of Directors.

The Board of Directors has approved the nomination of each of
the nominee for director listed below.

---------------------------------------------------------------
Nominee Age Director Since
------- --- --------------
---------------------------------------------------------------
George Q Horowitz 51 1992(1)
---------------------------------------------------------------
James K. Anderson 64 1992(1)(2)(3)
---------------------------------------------------------------
Larry Kring 60 1993(2)(3)
---------------------------------------------------------------
Rita Cinque-Kriss 35 1994(3)
---------------------------------------------------------------
Edward Epstein 61 1996(2)
---------------------------------------------------------------

(1) Member of the Executive Committee of the Board of Directors.
(2) Member of the Compensation Committee of the Board of Directors.
(3) Member of the Audit Committee of the Board of Directors.

The table below lists the other members of the Board of
Directors who are not up for election and who will be elected by the holders of
outstanding Series A Preferred Stock, $.001 par value of the Company for a term
to expire concurrent the directors to be elected at the Annual Meeting (the
"Series A Preferred Stock").

---------------------------------------------------------------
Name Age Director Since
---- --- --------------
---------------------------------------------------------------
Ben Nadorf 82 2000
---------------------------------------------------------------
Wayne Nadorf 26 2000
---------------------------------------------------------------

MR. GEORGE Q HOROWITZ has been the Chairman, Chief Executive Officer
("CEO") and President of Everlast Worldwide Inc. since he founded the Company in
1992. Mr. Horowitz, formerly an educator, entered the apparel industry in 1976,
having been employed by Golden Touch Imports, Inc. ("Golden Touch"), an apparel
company in New York City, as Vice President of Operations. He was also a
stockholder Golden Touch. The media frequently calls upon Mr. Horowitz for his
views on issues pertaining to the Company and the industry in general. He has
appeared on numerous television talk shows, such as CNBC's "Squawk Box" and
"Market Wrap," CNN's "Business Day" and "Moneyline News Hour with Lou Dobbs,"
Fox News Channel's "Cavuto Business Report," and "Sports Business," among
others. He has been included in the Sportstyle Magazine's Top 100 most
influential people in the sporting goods industry for three consecutive years.
He is currently serving on the Board of Trustees of the Sporting Goods
Manufacturers Association. Mr. Horowitz is also a member of the International
Radio and Television Society Foundation, Inc. He has been a speaker for several
industry events, including the Women's Wear Daily CEO Annual Summit and the
Fashion Round Table. Mr. Horowitz was chosen as one of the top leaders in the
fashion industry to join former President William J. Clinton for an evening
celebrating "The William Jefferson Clinton Presidential Library Foundation." Mr.
Horowitz serves as a member of the Benefit Committee of Fashion and Media
Leaders for the NOW Legal Defense and Education Fund. Mr. Horowitz has been
involved in various civic and sports related activities. He is a member of the
Three Miles of Men Honorary Committee for The Susan G. Komen Breast Cancer
Foundation New York City Race for the Cure. He has also served in different
capacities as a leader and a mentor to the youth in his community.

MR. JAMES K. ANDERSON has been a director of the Company since
August 1992 and was Chairman of the Board of Directors from January 1994 through
December 1995. Since January 1996, he has been Vice-Chairman of the Board of
Directors. Since July 1987, he has been a management consultant in restructuring
businesses. From 1981 to 1987, Mr. Anderson served as the President of Pacific
First Financial Corp. and Pacific First Federal Savings Bank and from 1984 to
1987, Mr. Anderson also served as the Chairman of the Board and Chief Executive
Officer of each of the two companies. Mr. Anderson has served on the board of
directors of numerous businesses, civic, arts and educational organizations and
is a member of the Whitman College Board of Overseers. He is currently a member
of the Board of Directors of the Washington Hospital Insurance Fund, an
insurance company, the Washington Casualty Company, an insurance company, and
Northwest Hospital, a medical hospital in Seattle, Washington. Mr. Anderson also
serves as the Chairman of the Board of Reality Based Learning Corp., a company
supplying educational materials. Mr. Anderson is also a director and the Chief
Executive Officer of Community Health Information Services, a health care
company.

MS. RITA CINQUE-KRISS has been a director of the Company since May
1994. Ms. Cinque-Kriss has served in numerous executive positions in the
Company, including as Vice President since October 2000 to the present,
Executive Vice President from May 1994 to October 2000, and as Vice
President-Operations from April 1993 to May 1994. Ms.Cinque-Kriss also served as
a consultant to the Company in the operations management from August 1992 to
April 1993. From November 1990 to August 1992, Ms. Cinque-Kriss was the
President of ITEW, Ltd., a management consulting company in the apparel
industry. In 1986, she was a founding member of Women in International Trade, an
organization created to promote international trade, where she served as a
director from January 1990 to January 1993.

MR. LARRY KRING has been a director of the Company since January
1993. Since August 1993, Mr. Kring has been a Group Vice President of Esterline
Technologies, a diversified instrumentation, equipment and component
manufacturing company listed on the New York Stock Exchange. From July 1978 to
July 1993, Mr. Kring was the President and Chief Executive Officer of Heath
Tecna Aerospace Company, a manufacturer of aircraft interior and aerospace
components and a division of Ciba-Geigy Corporation.

MR. EDWARD R. EPSTEIN has been a director since January 1996. Mr.
Epstein is a practicing attorney and is admitted to practice law in the States
of New York and Florida. He is an experienced litigator, and has represented
clients in all aspects of the garment industry for more than 30 years. He is a
member of the bars of the Supreme Court of the State of Florida, the Supreme
Court of the State of New York, various United States District Courts and the
United States Court of Appeals for the Second Circuit. He is a member of the
Association of Trial Lawyers of America and the Florida Academy of Trial
Lawyers.

MR. BEN NADORF has been a director of the Company since October 2000
and President of Active Apparel New Corp. since October 2000. From 1958 to
October 2000, Mr. Ben Nadorf served in various executive positions in Everlast
World's Boxing Headquarters Corp. such as the company's President from 1995 to
October 2000. Mr. Ben Nadorf was a majority stockholder of Everlast World's
Boxing Corp. when it was acquired by the Company. Mr. Ben Nadorf is the father
of Mr. Wayne Nadorf, another director of the Company.

MR. WAYNE NADORF has been a director since October 2000. He has also
been Assistant Vice President of Sales of Everlast World's Boxing Headquarters
Corp. since October 2000. From 1995 to October 2000, he served in various sales
positions with Everlast World's Boxing Headquarters Corp. In 1995, Mr. Wayne
Nadorf graduated from Rider University with a Bachelor of Science degree in
Marketing. Mr. Wayne Nadorf is the son of Mr. Ben Nadorf, another director of
the Company.

MEETINGS

The Board of Directors met six (6) times during the fiscal year
ended December 31, 2000. Messrs. Horowitz, Anderson, Kring and Epstein and Ms.
Cinque-Kriss attended at least five meeting. Messrs. Ben and Wayne Nadorf
attended the only meeting of the Board of Directors for the fiscal year ended
December 31, 2000 since becoming directors of the Company in October 2000.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board of Directors has established three standing
committees to assist it in carrying out its responsibilities. These committees
are the Executive Committee, the Compensation Committee and the Audit Committee.

The Board of Directors has an Executive Committee that is
responsible for special matters as determined by the Board of Directors from
time to time. For the fiscal year ended December 31, 2000, the members of the
Executive Committee were George Horowitz, as Chairman, and James Anderson. The
Executive Committee met four times during the fiscal year ended December 31,
2000. Both members of the Executive Committee attended all meetings.

This Board of Directors has a Compensation Committee that
recommends to the Board of Directors remuneration for the President, Chief
Executive Officer and other elected officers, recommends granting stock options,
administers the Company's stock option plans, and approves and administers other
compensation plans or agreements. For the fiscal year ended December 31, 2000,
the members of the Compensation Committee are James Anderson, as Chairman, Larry
Kring, and Edward Epstein. The Compensation Committee met five times during the
fiscal year ended December 31, 2000. All members of the Compensation Committee
attended at least four meetings.

The Board of Directors has an Audit Committee that reviews the
Company's financial statements and recommends to the Board of Directors that
such financial statements be included in the Company's annual report, reviews
filings with the Commission that contain financial statements of the Company,
reviews and recommends to the Board of Directors the independent auditors to be
selected, reviews the nature and scope of other professional services provided
to the Company by the independent auditors, and reviews the adequacy and
effectiveness of the accounting and financial controls of the Company. For the
fiscal year ended December 31, 2000, the members of the Audit Committee were
Larry Kring, as Chairman, Rita Cinque-Kriss and James Anderson. Messrs. Kring
and Anderson are independent, as independence is defined in Rule 4200(a)(14) of
the NASD listing standards. Although Ms. Cinque-Kriss is not independent, she
has had past professional experience in finance and accounting such as being the
Chief Financial Officer of the Company. Her membership in the Audit Committee is
based on the exemption provided by Rule 4350(d)(2)(D) of the NASD listing
standards which allows small businesses to maintain an Audit Committee of at
least two members, a majority of which are

independent. The Audit Committee has adopted a written Audit Committee Charter
that is attached hereto as Appendix A.

The Audit Committee met two times during the fiscal year ended
December 31, 2000. All members of the Audit Committee attended both its
meetings. Members of the Audit Committee have reviewed and discussed the audited
financial statements with the management of the Company and have discussed
matters required to be discussed by SAS 61 (Codification of Statements on
Auditing Standards, AU Section 380) with Berenson & Company LLP, the Company's
independent auditors for the fiscal year ended December 31, 2000. The Audit
Committee has received the written disclosures and the letter from Berenson &
Company LLP, as required by the Independent Standards Board Standard No. 1, and
have recommended that the audited financial statements be included in the
Company's annual report for the fiscal year ended December 31, 2000.

COMPENSATION OF DIRECTORS

Effective as of January 1, 1995, directors of the Company who
are neither officers nor employees of the Company receive options to purchase
shares of Common Stock pursuant to the Company's 1995 Non-Employee Director
Stock Option Plan (the "Directors' Plan") as part of their compensation for
their services as directors of the Company. The Directors' Plan provides for
annual automatic grants on the first working day of the fiscal year of options
to purchase 3,000 shares of Common Stock to each such director serving at the
time of the grant. The Chairman and Secretary of the Board of Directors and the
chairperson of a committee of the Board of Directors also receive an automatic
grant of options to purchase an additional 200 shares of Common Stock, provided
he or she is not an officer or employee of the Company. Each member of a
committee of the Board of Directors, provided that he or she is not an officer
or employee of the Company, also receives an automatic grant of options to
purchase an additional 100 shares of Common Stock. The exercise price per share
for all such options is the fair market value of the shares of Common Stock on
the date of grant. The term of each option is seven years from the date of
grant, and the options vest in three equal installments on the first, second and
third anniversaries of the date of grant.

Additionally, effective as of January 1, 1998, each director of
the Company who is neither an officer nor an employee of the Company receives an
annual fee of $6,000, one-fourth of such amount payable at the end of each
quarter. For the fiscal year ended December 31, 2000, Messrs. James K. Anderson,
Edward R. Epstein and Larry Kring each received a total of $6,000. Directors
also receive reimbursement of expenses incurred by them in performing their
duties and in attending meetings of the Board of Directors, provided that such
expenses are reasonable and evidenced by appropriate documentation.

MANAGEMENT

OTHER EXECUTIVE OFFICERS

---------------------------------------------------------------
Name Age Position Held
---- --- -------------
---------------------------------------------------------------
Angelo Guiti 50 Secretary & Senior
Vice-President of Operations

---------------------------------------------------------------
Matthew mark 60 Chief Financial Officer
---------------------------------------------------------------

MR. ANGELO GIUSTI has been Secretary and Senior Vice President of
Operations of the Company since October 2000. From June 1997 to October 2000 he
was Vice President of Operations of the Company. Mr. Giusti also served as a
director of the Company from January 1997 to October 2000. From 1984 until June
1997, Mr. Giusti was President of Universal Business Forms, a printing company
in New York City. From 1978 to 1984, Mr. Giusti was Sales Manager in New York
for Uarco, a national printing company. Mr. Giusti has served on many community
boards and activities. He was a New York City Public School teacher and has
remained active in local education and in youth sports activities. He is a
former President of the Holmdel (Jersey Shore) Pop Warner Football League.

MR. MATTHEW MARK has been Chief Financial Officer since October
2000. From May 1998 to October 2000, he was Controller of the Company. From June
1997 to May 1998, Mr. Mark served as the Controller of WHK, Inc., a private
label manufacturer of apparel. From January 1988 to April 1997, Mr. Mark served
as the Controller and Assistant Treasurer of Cygne Designs Inc., a private label
manufacturer of apparel. Additionally, Mr. Mark also held various financial
executive positions with Cluett Peabody, Inc., a diverse apparel manufacturer,
from October 1978 to January 1988.

EXECUTIVE COMPENSATION

The following Summary Compensation Table sets forth certain
information concerning total annual compensation paid to George Horowitz, the
Company's President, Chief Executive Officer and Treasurer, Ben Nadorf,
President of Active Apparel New Corp., Rita Cinque-Kriss, the Company's Vice
President and Angelo Giusti, the Company's Secretary and Executive Vice
President of Operations (collectively, the "Named Executive Officers"), for
services rendered in all capacities by them to the Company during fiscal years
ended December 31 2000, 1999, and 1998.

SUMMARY COMPENSATION TABLE
Annual Compensation

Name and Other Annual All Other Securities
Principal Compensation Compensation Underlying
Positions (1) Year Salary ($) Bonus($) ($) ($) Options (12)(#)
------------- ---- ---------- -------- --- --- --------------
George Horowitz 2000 320,769 226,821(2) 53,507(3) 1,171(6) 505,000
(Chairman, President; Chief 1999 277,697 21,000 21,068(4) 983(6) 40,000
Executive Officer & Treasurer) 1998 265,000 12,000 19,534(5) 853(6) 0

Angelo Giusti 2000 128,846 5,000 0 0 0
(Secretary & Senior Vice 1999 121,846 3,000 0 0 3,000
President of Operations) 1998 110,000 0 0 0 0

(1) Other than George Horowitz and Angelo Giusti, the Company had no other
employee who it paid more than $100,000 to in total salary and bonus
for fiscal year ended December 31, 2000.

(2) Consists of (i) bonus in the gross amount of $166,821 paid to Mr.
Horowitz pursuant to the merger agreement with Everlast Holding Corp.
to pay-off a loan owed to the Company, and (ii) annual bonus of $60,000
paid pursuant to Mr. Horowitz's employment agreement.

(3) Consists of (i) $31,956 paid to a trust account pursuant to the
Deferred Compensation Plan adopted by the Board of Directors on
December 17, 1999, and (ii) an aggregate of $21,551 paid by the
Company, on behalf of Mr. Horowitz, in fiscal year 2000 in connection
with automobile lease installment payments ($14,222), related insurance
premiums ($2,143) and parking expenses ($5,186).

(4) Consists of an aggregate of $21,068 paid by the Company, on behalf of
Mr. Horowitz, in fiscal year 1999 in connection with automobile lease
installment payments ($15,242), related insurance premiums ($1,422) and
parking expenses ($4,404).

(5) Consists of an aggregate of $19,534 paid by the Company, on behalf of
Mr. Horowitz, in fiscal year 1998 in connection with automobile lease
installment payments ($13,659), related insurance premiums ($1,088) and
parking expenses ($4,787).

(6) Represents premiums paid by the Company in fiscal years 2000, 1999 and
1998 on term life insurance policies for the benefit of Mr. Horowitz.

LONG-TERM INCENTIVE AND PENSION PLANS

The Company currently has no long-term incentive or defined pension
plans. The Company offers all employees a 401(k) savings plan that allows the
employees to voluntarily defer a certain portion of their income before taxes.
The Company pays all the administrative fees for the plan.

OPTION GRANTS IN LAST FISCAL YEAR

Number of
Securities Percent of Total
Underlying Options Granted to
Options Employees in Exercise Or Base
Name Granted Fiscal Year Price ($/Share) Expiration Date
---- ------- ----------- -------------- ---------------

George Horowitz 125,000 25% $4.00 10/24/11
380,000 75% $13.00 10/24/11

There were no other option grants to other Named Executive Officers
during the fiscal year ended December 31, 2000.

AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES TABLE

No stock options were exercised by the Named Executive Officers
during the year ended December 31, 2000. The following sets forth certain
information regarding unexercised options held by each of the Named Executive
Officers at December 31, 2000.

Number of Securities
Underlying Unexercised Value of Unexercised
Options Held at In-The-Money Options at
December 31, 2000(#) December 31, 2000($)(1)
Name Exercisable(2) Unexercisable Exercisable Unexercisable
---- -------------- ------------- ----------- -------------

George Horowitz 565,000 40,000 0 0
Angelo Giusti 5,500 7,500 0 0

----------------------

(1) Represents the total gain that would be realized if all the in-the-money
options held at December 31, 2000 were exercised, determined by
multiplying the number of shares underlying the options by the difference
between the per share option exercise price and the closing sale price of
Common Stock of $ 2.21 per share as reported on the Nasdaq SmallCap
Market for December 31, 2000. An option is in-the-money if the fair
market value of the underlying shares exceeds the exercise price of the
option.
(2) Includes options which are exercisable within 60 days hereof.

EMPLOYMENT CONTRACTS

GEORGE HOROWITZ - The Company and George Horowitz are parties
to an employment agreement, dated as of January 1, 2000 (the "Agreement")
pursuant to which Mr. Horowitz will serve as the President and Chief Executive
Officer of the Company through December 31, 2005 (the "Term"). Mr. Horowitz's
annual salary shall initially be $320,000 (the "Base Salary") and shall be
considered for increase by the Board of Directors. In addition to the Base
Salary, Mr. Horowitz is entitled to an annual cash bonus (the "Cash Bonus")
based upon certain "net sales" and "before tax profits" targets. Under the
Agreement, Mr. Horowitz is also entitled to receive a monthly automobile
allowance, reimbursement for parking expenses, health and medical insurance, and
participation in any retirement, life and disability insurance, dental insurance
and any bonus, incentive or profit-sharing plans which the Company makes
available from time to time to its executives. The Company has also agreed to
include Mr. Horowitz as a named insured in any director or officer liability
insurance policy the Company maintains on the same basis as is made available to
the directors and other executive officers of the Company. The Agreement
generally restricts Mr. Horowitz from disclosing certain confidential
information during the Term and for a period of one year following the Term, and
further restricts Mr. Horowitz from competing with the Company for a period of
one year following the Term. The Agreement may be terminated by Mr. Horowitz for
"good reason" or the Company "for cause". If the Agreement is terminated by the
Company "for cause" or in the event of the resignation by Mr. Horowitz without
"good reason," the obligations of the Company under the Agreement will terminate
(except with respect to certain indemnification provisions). In the event of
termination of the Agreement by reason of Mr. Horowitz's death, his estate is
entitled to receive the pro-rata amount of the Cash Bonus as of the time of his
death at the end of the same fiscal year. If Mr. Horowitz's employment is
terminated due to a Change of Control (as defined in the Agreement), he will be
entitled to a lump sum payment of 2.99 times the sum of the

Base Salary, Cash Bonus and benefits and payment for expenses incurred as a
result of such termination and any deferred compensation, including but not
limited to deferred bonuses allocated or credited to Mr. Horowitz as of the date
of his termination.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE.

Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Company's directors and executive officers, and persons
who beneficially own more than ten percent of the Company's Common Stock, to
file reports of ownership of Common Stock and other equity securities of the
Company with the Securities and Exchange Commission (the "Commission").
Officers, directors and more than ten percent stockholders are required by
Commission regulation to furnish the Company with copies of all Section 16(a)
reports they file. To the Company's knowledge, based solely on review of the
copies of such reports furnished to the Company during the fiscal year ended
December 31, 2000, all required Section 16(a) filings by beneficial owners were
complied with.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Edward R. Epstein, a Director, was paid $153,729 for legal
services for the year ending December 31, 2000.

The Company had a promissory note dated December 23, 1996 with
Mr. George Q Horowitz, President and Chief Executive Officer of the Company, in
the amount of $120,000 that was due July 31, 2000. The unpaid principal bears
interest at prime plus 1 1/2%. This note was refinanced on December 31, 1999 in
the amount of $91,200 and was due on July 31, 2009. On October 24, 2000, Mr.
Horowitz paid the Company the total balance on the promissory note in
satisfaction of one of the conditions to closing of the merger of Everlast
Holding Corp. into the Company wholly owned subsidiary, Active Apparel New Corp.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF EACH OF THE NOMINEES

PROPOSAL 2 -- RATIFICATION OF THE COMPANY'S AUDITORS

The Board of Directors has selected Berenson & Company LLP
("Berenson") as the Company's independent auditors for the fiscal year ending
December 31, 2001. Stockholder ratification of the selection of Berenson as the
Company's independent accountants is not required by the Company's By-laws or
otherwise. However, as was true for the 2000 Annual Meeting of Stockholders (at
which the stockholders ratified the selection of Berenson), the Board of
Directors is submitting the selection of Berenson to the stockholders for
ratification as a matter of good corporate practice. If the stockholders fail to
ratify the selection, the Audit Committee and the Board of Directors will
reconsider whether or not to retain the services of Berenson. The Board of
Directors and the Audit Committee reserves the right to appoint a different
independent accounting firm at any time during the year even if the selection of
Berenson is ratified, if the Board of Directors and the Audit Committee believes
that the change is in the best interest of the Company and its stockholders.

Berenson was originally engaged as the Company's independent
auditors in May 1995. Berenson has audited the Company's financial statements
for the fiscal years ended December 31, 1995 through December 31, 2000. A
representative of Berenson will be present at the Annual Meeting and will be
available to respond to questions.

AUDIT FEES - Berenson billed the Company $107,700 for
professional services rendered for the audit of the Company's consolidated
financial statements for fiscal year ended December 31, 2000, and for the review
interim financial statements during the fiscal year ended December 31, 2000
which are included in the Company's quarterly reports on Form 10-QSB.

FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES -
Berenson did not perform any services for the Company related to financial
information systems design and implementation during fiscal year ended December
31, 2000.

ALL OTHER FEES - Berenson billed the Company $67,400 for other
professional services rendered, primarily due to tax consulting and consulting
services in relation to the merger of Everlast Holding Corp. into the Company's
wholly owned subsidiary, Active Apparel New Corp.

The Audit Committee has considered whether the provision by
Berenson of the services covered by the fees other than the audit fees is
compatible with maintaining Berenson's independence and has determined that it
is compatible.

REQUIRED VOTE

The approval of the proposal to ratify the appointment of
Berenson requires the affirmative vote of a majority of the votes cast.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE RATIFICATION OF THE APPOINTMENT OF BERENSON & COMPANY LLP

STOCKHOLDERS PROPOSALS

Stockholder proposals made in accordance with Rule 14a-8 under
the Exchange Act and intended to be presented at the Company's 2002 Annual
Meeting of Stockholders must be received by the Company at its principal office
in New York, New York no later than January 8, 2002 for inclusion in the proxy
statement for that meeting.

In addition, Rule 14a-4 under the Exchange Act requires that a
stockholder give advance notice to the Company of other matters that the
stockholder wishes to present for action at an annual meeting of stockholders.
Such stockholder's notice must be given in writing, include the information
required by the Bylaws of the Company, and be delivered or mailed by first class
United States mail, postage prepaid, to the Secretary of the Company at its
principal offices. The Company must receive such notice not less than 45 days
prior to the date in the current year that corresponds to the date in the prior
year on which the Company first mailed its proxy materials for the prior year's
annual meeting of

stockholders. While the Company has not yet set the date of its 2002 Annual
Meeting of Stockholders, if it were held on June 15, 2002 (the date that
corresponds to the date on which the Annual Meeting is being held), notice of a
director nomination or stockholder proposal made otherwise than in accordance
with Rule 14a-8 would be required to be given to the Company no later than May
8, 2002.

OTHER MATTERS

The Board of Directors does not intend to present and has not
been informed that any other person intends to present any matters for action at
the Meeting other than those specifically referred to in this proxy statement.
If any other matters properly come before the Meeting, it is intended that the
holders of the proxies will act in respect thereof in accordance with their best
judgment.

A copy of the Company's Form 10-KSB containing the Company's
financial statements for the year ending December 31, 2000, as filed with the
Commission, was included as part of the Company's Annual Report to Stockholders
which is being furnished along with this Proxy Statement to all beneficial
stockholders or stockholders of record as of the Record Date. For further
copies, please contact: Secretary, EVERLAST WORLDWIDE INC., 1350 Broadway, Suite
2300, New York, New York 10018.

April 30, 2001

By Order of the Board of Directors

/s/ George Q Horowitz
George Q Horowitz
President, Chief Executive Officer

Exhibit A

CHARTER OF THE AUDIT COMMITTEE

EVERLAST WORLDWIDE INC.
(f/k/a Active Apparel group, Inc.)

The Audit Committee of the Board of Directors of
Everlast Worldwide Inc. (f/k/a Active Apparel Group, Inc., the "Corporation")
(the "Committee") shall assist the Board of Directors in fulfilling its
oversight responsibilities with respect to the financial reports and other
financial information provided by the Corporation to the stockholders and to the
general public, the Corporation's internal controls, and the Corporation's
audit, accounting and financial reporting processes generally. The Committee
shall serve as an independent and objective monitor of the performance of the
Corporation's financial reporting process and system of internal control; review
and appraise the audit efforts of the Corporation's independent accountants; and
provide for open, ongoing communication among the independent accountant,
financial and senior management, and the Board of Directors concerning the
Corporation's financial position and affairs. The Committee will report its
actions to the Board of Directors with such recommendations as the Committee may
deem appropriate. The Committee shall be governed in accordance with the By-Laws
of the Corporation as well as have the following powers and duties:

1. Structure and Composition. The Committee shall be
composed of at least three independent directors who are all capable of reading
, understanding and analyzing financial statements, or who will become
financially literate within a reasonable time after being appointed to the
Committee. At least one member of the Committee shall have past employment
experience in finance or accounting, or any comparable experience or background
which results in that committee member having financial sophistication. The
members of the Committee shall elect the Chairman (the "Chairman") from among
themselves. The independence of a director shall be determined in accordance
with the rules and regulations of the securities market where the Corporation's
shares of Common Stock are traded. The duties and responsibilities of a member
of the Committee are in addition to those duties generally pertaining to a
member of the Board of Directors.

2. General Financial Oversight. The Committee shall meet
with the independent accountants and the principal accounting officers of the
Corporation to ascertain that reasonable procedures and controls are followed to
safeguard the Corporation's assets and that adequate examinations are made to
ensure the reasonableness of the results reported in the financial statements
for the fiscal year. Specifically, the Committee shall:

o Review the financial information contained in the Corporation's
Quarterly Report on Form 10-QSB prior to its filing with the
Securities and Exchange Commission (the "SEC"), the Corporation's
earning announcement prior to release, and the results of the
independent accountant's review of Interim Financial Information
pursuant to SAS 71. The Chairman may represent the Committee, either
in person or by telephone conference call, for the purpose of this
review.

o Review with management and the independent accountants at the
completion of the annual audit and prior to filing the Corporation's
annual report on Form 10-KSB (the "Annual Report") with the SEC, the
accuracy and completeness of the following :

(i) the Corporation's financial statements included in
the Annual Report and related footnotes;

(ii) the independent accountant's audit of the financial
statements and their report;

(iii) any significant changes required in the
independent accountant's examination plan;

(iv) any serious difficulties or disputes with
management encountered during the course of the audit;
and

(v) other matters related to the conduct of the audit
which are to be communicated to the Committee under
generally accepted auditing standards, including
discussions relating to the independent accountants'
judgement about such matters as to the quality, not just
the acceptability, of the Corporation's accounting
practices and other items set forth in SAS 61
(Communications with Audit Committees) or other such
auditing standards that may in time modify, supplement
or replace SAS 61.

o The Committee will have prepared and reviewed the Audit Committee
Report for inclusion in the annual stockholder's meeting proxy
statement. The Committee must state whether it:

(i) has reviewed and discussed the audited financial
statements with management;

(ii) has discussed with the independent accountant the
matters required to be discussed by SAS 61, as may be
modified, supplemented or replaced;

(iii) has received the written disclosures from the
independent accountants required by Independence
Standards Board Standard No. 1 ("ISBS No. 1"), as may be
modified or supplemented, and has discussed with the
accountant their independence; and

-2-

(iv) has recommended to the Board of Directors, based on
the review and discussions referred to in above items
(i) through (iii), that the Corporation's financial
statements be included in the Annual Report on Form 10-K
for the last fiscal year for filing with the SEC.

3. Selection of Independent Accountants. The Committee
shall recommend the firm of independent accountants to be nominated for the
ensuing year at the Board of Directors meeting when such action is taken.

o Before recommending a continuing independent accountant, the
Committee shall ensure the receipt for the year of, and review with
the independent accountant, a written statement required by ISBS
No.1, as may be modified or supplemented, and discuss their
continued independence with the accountant. The Committee will
recommend that the Board of Directors take appropriate action on any
disclosed relationships that may reasonably be brought to bear on
the independence of the accountants and satisfy itself that the
Corporation has engaged independent accountants as required by the
Securities Act of 1933,as amended.

o Together with the Board of Directors, the Committee shall submit
to the stockholders for ratification or rejection at the annual
meeting of stockholders the independent accountants selected.

4. Controls, Policies and Procedures Oversight. The
members of the Committee shall meet from time to time to review accounting
policies followed, changes therein, internal and accounting controls, and any
issues that may be raised by the independent accountants. At the discretion of
the Chairman, the principal accounting officers of the Corporation may be
invited to attend the meetings of the Committee with the independent
accountants. The Committee may request the independent accountants to report on
the adequacy of their examination, their views of the Corporation's internal
controls, and on the Corporation's compliance with accepted accounting
principles adopted by the accounting profession, as well as the effect of
unusual or extraordinary transactions. The Committee shall also be responsible
for the following:

o Obtain the approval of the full Board of Directors of this Charter
and shall review and reassess this Charter as conditions dictate, at
least on annual basis;

o Periodically review the adequacy of the Corporation's accounting,
financial, and auditing personnel resources.

5. Advice; Legal Representation. The Committee is
authorized to confer with the Corporation's management and other employees to
whom it may deem necessary or appropriate to fulfill its duties. The Committee
is authorized to conduct or authorize investigations into any matter within the
Committee's scope of responsibilities. The Committee also is authorized to seek
outside legal or other advice to the extent it deems necessary or appropriate,
provided it shall keep the Board of Directors advised as to the nature and
extent of such outside advice.

-3-

EVERLAST WORLDWIDE INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

2001 ANNUAL MEETING OF STOCKHOLDERS

JUNE 15, 2001

The undersigned hereby appoints each of Messrs. George Q Horowitz
and James K. Anderson as the undersigned's proxy, with full power of
substitution, to vote all of the undersigned's shares of common stock, par value
$.002 per share, in Everlast Worldwide Inc. (the "Company"), at the 2001 Annual
Meeting of Stockholders of the Company to be held on June 15, 2001 at 10:00 A.M.
local time, at the Kitano at 66 Park Avenue (at 38th Street), New York, New York
10016, or at any adjournment, on the matters described in the Notice of 2001
Annual Meeting of Stockholders and Proxy Statement and upon such other business
as may properly come before such meeting or any adjournments thereof, hereby
revoking any proxies heretofore given.

PROPOSAL 1 The election of George Q Horowitz, James K. Anderson,
Rita Cinque-Kriss, Larry Kring and Edward R. Epstein:

For All Withhold Authority To
Nominees ___ Vote For All Nominees ___

---------------------------------------------------------
---------------------------------------------------------
To withhold authority to vote for any
individual nominee(s), print name(s) above.

PROPOSAL 2 Ratification of the appointment of Berenson & Company LLP
as the Company's auditors for the fiscal year ending December 31, 2001:

FOR / / AGAINST / / ABSTAIN / /

(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)

EACH PROPERLY EXECUTED PROXY WILL BE VOTED IN ACCORDANCE WITH SPECIFICATIONS
MADE ON THE REVERSE SIDE HEREOF. IF NO SPECIFICATIONS ARE MADE, THE SHARES
REPRESENTED BY THIS PROXY WILL BE VOTED FOR APPROVAL OF PROPOSAL 2 AND FOR THE
ELECTION AS DIRECTORS OF EACH OF THE NOMINEES OF THE BOARD OF DIRECTORS.

----------------------------------
Signature

----------------------------------

Signature if held jointly

Dated: ___________, 2001

Please sign exactly as set forth
herein. If signed as executor,
attorney, administrator, trustee
or guardian, indicate the capacity
in which you are acting. When
signing as joint tenants, all
parties in the joint tenancy
should sign. Proxies by
corporations should be signed with
full corporate name by a duly
authorized officer and bear
corporate seal.

PLEASE PROMPTLY SIGN AND RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE.