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Stocks H / Hampshire Group, Limited


Subject:  Re: CFO resigns Date:  12/2/2003  2:11 PM
Author:  howardroark Number:  12 of 17

Bill leaving was unrelated to the royalty audit. That charge was only about half the $1.3m disclosed in the Q -- the rest came from a contract termination reserve related to another employee. The piece attributable to the audit related to a contract interpretation issue with Geoffrey Beane over whether Hampshire had to make starndard advertising contributions even in cases where the downstream retailer was not actually permitted to advertise (such as warehouse clubs) -- there was no financial miscalculation. It's impossible to ever know the real reason in a case, but both the company and Hodge will tell you that it's also unrelated to the management led purchase of the real estate assets or any other financial or accounting related disagreement. It's worth noting that Charlie Clayton, who is the interim CFO while they search for a permanent replacement, is also the former CFO and arguably higher up on the company totem pole than Hodge was.
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