Destination XL Group (DXLG) investor relations material

Executive summary

• Proposed stock-for-stock merger would leave FBB as a wholly owned subsidiary; FBB holders expected to own 55% and existing holders 45% of the combined entity on a fully diluted basis.

• The board withdrew its December 2025 support and now says the merger is not advisable or in stockholders’ interests; it must still submit the share issuance for a vote under the merger agreement.

• Reasons include FBB’s weaker-than-projected sales, earnings and cash flow, rising debt, financing uncertainty, possible negative equity value and substantial dilution to existing holders.

• May 2026 analyses valued FBB’s standalone equity at negative $22.5M to negative $3.5M and indicated $111.9M of incremental FBB debt reduction was needed under the primary analysis.

Voting matters and shareholder proposals

• Board recommendation: AGAINST the merger share issuance; FOR the reverse split, 2016 plan amendment and meeting adjournment proposals.

• Each proposal requires a majority of votes cast; issuance approval is a merger condition, while the reverse split and plan proposals may proceed even if the merger fails.

• Voting agreements cover 20.78% of outstanding shares, including 10.38% held by PLP; those commitments to support issuance remain binding despite the board’s opposition.

• At the record date, 55,476,987 shares were outstanding; a majority must be present for a quorum, and the agreements alone are insufficient to establish one.

• The adjournment proposal would allow additional proxy solicitation if votes are insufficient; approval is not a condition to the merger.

Board of directors and corporate governance

• If completed, the combined board would have nine members: four designated by each side and one mutually agreed independent director; Lionel F. Conacher is expected to chair.

• Jim Fogarty is slated to be CEO and Peter H. Stratton, Jr. CFO; Conacher became interim CEO effective August 12, 2026, following Harvey Kanter’s August 11 retirement.

• Conacher was appointed interim CEO; Carmen R. Bauza became lead independent director effective August 12, 2026.

• Proposed committee chairs are Willem Mesdag for audit, Josh Beer for compensation and Steven Tesoriere for nominating and governance; all proposed directors except Fogarty are expected to qualify as Nasdaq-independent.