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:
|
1)
|
Amount
Previously Paid:
|
2)
|
Form,
Schedule or Registration Statement
No.:
|
3)
|
Filing
Party:
|
4)
|
Date
Filed:
|
Time
and Date
|
10:00
a.m. local time on Tuesday, May 12, 2009
|
Place
|
Corporate
Offices
Tandy
Leather Factory, Inc.
1900
Southeast Loop 820
Fort
Worth, Texas 76140
|
Items
of Business
|
(1) To
elect seven directors to the Board of Directors for a one-year
term
(2) To
consider such other business as may properly come before the
meeting
|
Adjournments
and
Postponements
|
Any
action on the items of business described above may be considered at the
time and on the date specified above or at any time and date to which the
annual meeting may be properly adjourned or postponed.
|
Record
Date
|
You
are entitled to vote only if you were a shareholder of our common stock at
the close of business on April 1, 2009.
|
Voting
|
Your
vote is very important. Whether or not you plan to attend the
annual meeting, we encourage you to read this proxy statement and submit
your proxy or voting instructions as soon as possible. You may
submit your proxy or voting instructions for the annual meeting by
completing, signing, dating and returning your proxy or voting instruction
card in the pre-addressed envelope provided. For specific
instructions on how to vote your shares, please refer to the section
titled "Questions and Answers" in this proxy statement and the
instructions on the proxy or voting instruction card.
|
Availability
of
Proxy
Materials
|
A
copy of this proxy statement and our 2008 annual report to stockholders
are available at www.tlfproxy.com.
|
Sincerely,
|
|
/s/ Wray Thompson
|
|
Wray
Thompson
|
|
Chairman
of the Board of
Directors
|
Page
|
|
GENERAL
INFORMATION ABOUT THE ANNUAL MEETING AND VOTING
|
1
|
SECURITY
OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS
|
2
|
PROPOSAL
1: ELECTION OF DIRECTORS
|
3
|
ADDITIONAL
INFORMATION CONCERNING OUR BOARD OF DIRECTORS
|
3
|
2008
DIRECTOR COMPENSATION TABLE
|
3
|
COMMITTEES
OF THE BOARD
|
4
|
Nominating
Committee
|
4
|
Audit
Committee
|
4
|
Audit
Fees
|
4
|
Report
of the Audit Committee
|
5
|
COMPENSATION
DISCUSSION AND ANALYSIS
|
5
|
Compensation
Committee
|
5
|
Base
Salary
|
5
|
Bonuses
|
5
|
Stock
Options
|
5
|
Retirement
and Other Benefits
|
5
|
Compensation
Committee Interlocks and Insider Participation
|
5
|
Report
of the Compensation Committee
|
6
|
COMPENSATION
TABLES AND OTHER INFORMATION
|
6
|
SUMMARY
COMPENSATION TABLE
|
6
|
OUTSTANDING
EQUITY AWARDS AT 2008 FISCAL YEAR-END
|
6
|
RELATIONSHIPS
AND TRANSACTIONS WITH RELATED PERSONS
|
7
|
SECTION
16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
|
7
|
EQUITY
COMPENSATION PLANS
|
7
|
OTHER
MATTERS
|
7
|
Solicitation
of Proxies
|
7
|
Stockholder
Proposals for 2010
|
7
|
Stockholder
Communications with Board
|
7
|
Householding
of Annual Meeting materials
|
7
|
General
Information
|
7
|
·
|
Election
of seven directors for a term of one
year.
|
·
|
The
board recommends a vote FOR each of the director
nominees.
|
·
|
By
Internet at www.proxyvote.com;
|
·
|
By
completing and mailing your proxy card;
or
|
·
|
By
written ballot at the meeting.
|
·
|
Filing
a written notice of revocation, bearing a date later than the proxy date,
with our secretary at or before the
meeting;
|
·
|
Properly
executing a later proxy relating to the same shares;
or
|
·
|
Attending
the meeting and voting in person; however, attendance at the meeting will
not in and of itself constitute a revocation of a
proxy.
|
·
|
Beneficial
owners of more than 5 percent of the outstanding shares of our stock,
other than our officers and
directors;
|
·
|
Beneficial
ownership by our current directors and the named executive officers set
forth in the Summary Compensation table on page 11;
and
|
·
|
Beneficial
ownership by all our current directors and executive officers as a
group.
|
Name and Address
Non-Officer and Director Holders of More than
5%
|
Shares
beneficially owned
(1)
|
Percent of Class
|
Bares
Capital Management, Inc.
221
W 6th
Street, Suite 1225, Austin, TX 78701 (2)
|
1,525,509
|
14.08%
|
Wellington
Management Company, LLP (3)
75
State Street, Boston, MA 02109
|
1,400,300
|
12.93%
|
Nery
Capital Partners, L.P. (4)
959
Merrimon Avenue, Suite 6 – Box 9, Asheville,
NC 28804
|
1,060,000
|
9.79%
|
Directors and Executive
Officers
|
||
Wray
Thompson(5)
|
221,496
|
2.05%
|
Ron
& Robin Morgan(6)
|
1,798,932
|
16.61%
|
Shannon
L. Greene(7)
|
172,193
|
1.64%
|
Jon
Thompson(8)
|
217,417
|
2.01%
|
Mark
Angus(9)
|
31,024
|
*
|
T.
Field Lange(10)
|
7,000
|
*
|
Joseph
R. Mannes(11)
|
28,000
|
*
|
L.
Edward Martin III(12)
|
1,000
|
*
|
All
Current Directors and Executive Officers as a Group (9
persons)
|
3,542,057
|
32.71%
|
(1)
|
The
amounts reflected in this column include common shares owned directly or
indirectly in which there is sole voting and/or vote investment power,
except as otherwise noted. To our knowledge, none of these
shares have been pledged. The inclusion herein of shares listed as
beneficially owned does not constitute an admission of beneficial
ownership. In accordance with SEC rules, the amounts reflected
in this column also include options to acquire the underlying common
shares within 60 days following March 20,
2009.
|
(2)
|
We
have received a copy of a report on Schedule 13G, with a signature dated
January 12, 2009 disclosing 1,525,509 shares with shared voting power and
1,525,509 shares with shared dispositive
power.
|
(3)
|
We
have received a copy of a report on Schedule 13G, with a signature dated
Februay 17, 2009 disclosing 510,900 shares with shared voting power and
1,400,300 shares with shared dispositive
power.
|
(4)
|
Michael
A. Nery, one of our directors, is the owner of an investment advisory firm
that directs the investments of Nery Capital Partners, L.P., which is the
record holder of the shares
indicated.
|
(5)
|
Wray
Thompson, Chairman of the Board, holds 221,496 shares
directly.
|
(6)
|
Ron
Morgan, a director and our Chief Executive Officer, and Robin Morgan, our
Vice President of Administration and Assistant Secretary, are
married. Shares beneficially owned by Mr. and Mrs. Morgan are
held as community property. They hold 1,798,932 shares
directly.
|
(7)
|
Shannon
L. Greene, a director and Chief Financial Officer and Treasurer, holds
77,193 shares directly and 100,000 shares in options that will vest within
60 days of March 20, 2009.
|
(8)
|
Jon
Thompson, President, holds 197,413 shares directly and 20,000 shares in
options that will vest within 60 days of March 20,
2009.
|
(9)
|
Mark
Angus, Senior Vice President, holds 31,024 shares
directly.
|
(10)
|
T.
Field Lange, a director, holds 1,000 shares directly and 6,000 shares in
options that will vest within 60 days of March 20,
2009.
|
(11)
|
Joseph
R. Mannes, a director, holds 14,000 shares directly and 14,000 shares in
options that will vest within 60 days of March 20,
2009.
|
(12)
|
L.
Edward Martin, a director, holds 1,000 shares
directly.
|
Name
|
Fees
Earned or
Paid
in Cash ($)
|
Total
($)
|
Joseph
R. Mannes
|
$8,500
|
$8,500
|
T.
Field Lange
|
7,250
|
7,250
|
Michael
A. Nery
|
7,000
|
7,000
|
L.
Edward Martin III
|
7,000
|
7,000
|
Name of
Director
|
Audit
|
Compensation
|
Nominating
|
2007
Director Non-Qualified Stock Option
Plan
|
Non-Employee
Directors:
|
||||
T.
Field Lange
|
X
|
C
|
C
|
|
Joseph
R. Mannes
|
C
|
X
|
X
|
|
L.
Edward Martin, III
|
X
|
X
|
X
|
|
Michael
A. Nery
|
X
|
X
|
X
|
|
Employee
Directors:
|
||||
Shannon
L. Greene
|
X
|
|||
Ron
Morgan
|
X
|
|||
Wray
Thompson (1)
|
C
|
|||
Number
of Meetings in Fiscal 2008
|
4
|
1
|
0
|
0
|
·
|
As
to each person whom the stockholder proposes to nominate for election or
re-election as a director, all information relating to such person that is
required to be disclosed in solicitations of proxies for election of
directors, or as otherwise required, in each case pursuant to Regulation
14A under the Securities Exchange Act of 1934, as amended, or any
successor regulation thereto (including such person’s written consent to
being named in the proxy statement as a nominee and to serving as a
director if elected); and
|
·
|
The
nominating stockholder’s name and address, as they appear on our books,
and the class and number of our shares beneficially owned by
him.
|
Types of Fees
|
2007
|
2008
|
Audit
fees
|
$75,000
|
$80,500
|
Audit-related
fees
|
-
|
-
|
Tax
fees
|
-
|
-
|
All
other fees
|
-
|
-
|
Total
|
$75,000
|
$80,500
|
AUDIT
COMMITTEE:
|
||
JOSEPH
R MANNES, Chairman
|
||
T.
FIELD LANGE
|
||
MICHAEL
A. NERY
|
||
L.
EDWARD MARTIN,
III
|
·
|
Base
salary;
|
·
|
Annual
incentive bonus;
|
·
|
Long-term
incentives in the form of stock option grants;
and
|
·
|
Retirement
and other benefits.
|
COMPENSATION
COMMITTEE:
|
||
T.
FIELD LANGE, Chairman
|
||
JOSEPH
R. MANNES
|
||
MICHAEL
A. NERY
|
||
L.
EDWARD MARTIN, III
|
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Option
Awards
($)(2)
|
All
Other
Compensation
($)
(1)
|
Total
($)
|
Wray
Thompson, Chairman of the Board (3)
|
2008
2007
2006
|
$50,000
$100,000
$170,000
|
-
-
-
|
-
-
-
|
-
-
$6,242
|
$50,000
$100,000
$176,242
|
Mark
Angus, Senior Vice President
|
2008
2007
2006
|
$100,000
$100,000
$95,000
|
$30,000
$30,000
$50,000
|
-
-
$9,635
|
$2,561
$2,668
$5,872
|
$132,561
$132,668
$160,507
|
Shannon
L. Greene, Chief Financial Officer & Treasurer
|
2008
2007
2006
|
$120,000
$120,000
$120,000
|
$40,000
-
$60,000
|
$11,650
$11,650
$21,285
|
$2,469
$2,645
$7,230
|
$174,119
$134,295
$208,515
|
Ron
Morgan, Chief Executive Officer
|
2008
2007
2006
|
$170,000
$170,000
$165,000
|
$40,000
-
-
|
-
-
-
|
$3,335
$2,668
$8,992
|
$213,335
$172,668
$173,992
|
Robin
Morgan, Vice President-Admin & Assistant Secretary
|
2008
2007
2006
|
$85,000
$85,000
$85,000
|
$15,000
-
$15,000
|
-
-
-
|
$1,667
$4,000
$4,395
|
$101,667
$89,000
$104,395
|
Jon
Thompson, President and Chief Operating Officer
|
2008
2007
2006
|
$110,000
$110,000
$110,000
|
$30,000
$30,000
$50,000
|
-
-
$9,635
|
$2,758
$2,668
$6,557
|
$142,758
$142,668
$176,192
|
(1)
|
The
amounts in this column represent the 401(k) plan company matching
contribution and the company contribution to the Employees Stock Ownership
Plan for the named individuals.
|
(2)
|
The
amounts in this column reflect the dollar amount recognized for financial
statement reporting purposes for the fiscal year ended December 31, 2008,
in accordance with FAS 123(R) of awards pursuant to the 1995 Stock Option
Plan. Assumptions used in the calculation of this amount for
fiscal year ended December 31, 2008 are included in footnote 1 to our
audited financial statements for the fiscal year ended December 31, 2008,
included in our Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 31,
2009.
|
(3)
|
Mr.
Thompson serves as our Chairman of the Board. In January 2008,
we entered into a one year consulting agreement with Mr. Thompson for his
service and agreed to pay him $50,000. For 2009, we have
entered into a one year consulting agreement with Mr. Thompson pursuant to
which we agreed to pay Mr. Thompson $25,000 for his continued service as
our Chairman of the Board.
|
Option
Awards
|
||||
Name
|
Number
of Securities
Underlying
Unexercised
Options (#)
Exercisable
|
Number
of Securities
Underlying
Unexercised
Options
(#) Unexercisable
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Wray
Thompson, Chairman of the Board
|
n/a
|
n/a
|
n/a
|
n/a
|
Mark
Angus, Senior Vice President
|
-
|
-
|
n/a
|
n/a
|
Shannon
L. Greene,
Chief
Financial Officer & Treasurer
|
40,000
60,000
25,000
|
-
-
-
|
$0.9375
$1.35
$4.24
|
09/13/2010
05/24/2011
09/16/2013
|
Ron
Morgan, Chief Executive Officer
|
n/a
|
n/a
|
n/a
|
n/a
|
Robin
Morgan, Vice President-Admin & Asst Secretary
|
n/a
|
n/a
|
n/a
|
n/a
|
Jon
Thompson, President and Chief Operating Officer
|
20,000
|
-
|
$1.35
|
05/24/2011
|
Name
|
Number
of Shares
Acquired
on Exercise(#)
|
Value
Realized
on
Exercise($)(1)
|
|
Wray
Thompson, Chairman of the Board
|
n/a
|
n/a
|
|
Mark
Angus, Senior Vice President
|
n/a
|
n/a
|
|
Shannon
L. Greene, Chief Financial Officer & Treasurer
|
n/a
|
n/a
|
|
Ron
Morgan, Chief Executive Officer
|
n/a
|
n/a
|
|
Robin
Morgan, Vice President-Admin & Asst Secretary
|
n/a
|
n/a
|
|
Jon
Thompson, President and Chief Operating Officer
|
10,000
|
$16,600
|
(1)
|
Represents
the difference between the closing price of the common stock on the NYSE
Amex on the exercise date and the option exercise price multiplied by the
number of shares exercised.
|
Plan
Category
|
Column (a)
Number
of Securities to be issued upon
exercise
of outstanding options,
warrants
and rights
|
Column (b)
Weighted-average
exercise price
of
outstanding
options,
warrants
and rights
|
Column (c)
Number
of securities remaining available for future
issuance
under equity compensation plans
excluding
securities reflected in Column (a)
|
Equity
compensation plans approved by stockholders
|
224,700
|
$2.16
|
100,000
|
Equity
compensation plans not approved by stockholders (1)
|
7,500
|
5.00
|
-
|
TOTAL
|
232,200
|
$2.25
|
100,000
|
1.
Election of seven directors.
|
||
NOMINEES:
|
Shannon
L. Greene
|
T.
Field Lange
|
Joseph
R. Mannes
|
L.
Edward Martin III
|
|
Michael
A. Nery
|
Jon
Thompson
|
|
Wray
Thompson
|
||
Mark
here for
|
|
address
change [ ]
|
|
and
note at left
|
|
Please
sign exactly as your name appears on this Proxy. Date and
promptly return this Proxy in the enclosed
envelope.
|
Signature: _____________________________________
|
Signature: _____________________________________
|
Date: ________________________________,
2009
|
Date: ________________________________,
2009
|