##### Table of Contents






As filed with the Securities and Exchange Commission on
September 8, 2005








Registration No. 333-126936











UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549








Amendment No. 1








to





Form F-4


REGISTRATION STATEMENT


UNDER


THE SECURITIES ACT OF 1933





HENRY BIRKS & SONS INC.


(Exact name of registrant as specified in its charter)


|                                                                   |  |                                                              |  |                                            
|------------------------------------------------------------------ |  | ------------------------------------------------------------ |  | -------------------------------------------
|CANADA                                                             |  | 5944                                                         |  | Not Applicable                             
|(State or other jurisdiction of
    incorporation or organization) |  | (Primary Standard Industrial
    Classification Code Number) |  | (I.R.S. Employee
    Identification Number)

1240 Square Phillips, Montreal, Quebec, Canada, H3B 3H4,
(514) 397-2511


(Address, including zip code, and telephone number, including
area code, of registrants principal executive offices)





CT Corporation System


111 Eighth Avenue,
13th Floor


New York, NY 10011


(212) 590-9331


(Name, address, including zip code, and telephone number,
including area code, of agent for service)





Copies to:


|                                                                                                                                                                                                          |  |                                                                                                                                                             |  |                                                                                                                                   |  |                                                                                                                       
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------
|Sabine Bruckert, Esq.
     Vice President, General Counsel
     and Corporate Secretary
     Henry Birks & Sons Inc.
     1240 Square Phillips
     Montreal, Quebec, Canada, H3B 3H4
     (514) 397-2511 |  | Brice T. Voran, Esq.
    Shearman & Sterling LLP
    Commerce Court West
    199 Bay Street, Suite 4405,
    Toronto, ON, Canada M5L 1E8
    (416) 360-8484 |  | Rodney H. Bell, Esq.
    Holland & Knight LLP
    701 Brickell Avenue
    Suite 3000
    Miami, Florida 33131
     (305) 374-8500 |  | C. William Baxley, Esq.
    King & Spalding LLP
    191 Peachtree Street
    Atlanta, Georgia 30303
    (404) 572-4600




Approximate date of commencement of proposed sale to the
public:


o





o








The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a)
of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission,
acting pursuant to Section 8(a), may determine.










---



##### Table of Contents



|The information in
this proxy statement/ prospectus is not complete and may be
changed. We may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is
effective. This proxy statement/ prospectus is not an offer to
sell these securities and it is not soliciting an offer to
buy these securities in any state where the offer or sale is not
permitted.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------




SUBJECT TO COMPLETION, DATED
SEPTEMBER 8, 2005





MAYORS JEWELERS, INC.


14051 N.W.
14th Street,
Suite 200


Sunrise, Florida 33323


,
2005


To the Stockholders of Mayors Jewelers, Inc.:














The board of directors of Mayors recommends that the
stockholders of Mayors vote FOR the approval
and adoption of the merger agreement, FOR the
election of the director nominee and FOR the
ratification of the appointment of KPMG LLP as Mayors
independent registered public accounting firm for the fiscal
year ending March 25, 2006.







PLEASE READ THIS
DOCUMENT CAREFULLY, INCLUDING THE SECTION DESCRIBING RISK
FACTORS BEGINNING ON PAGE 18.





Whether or not you plan to attend the special and annual
meeting, please submit your proxy promptly by completing, dating
and returning your proxy card in the enclosed envelope.
Returning the proxy card does not deprive you of your right to
attend the special and annual meeting and vote in person.


Neither the Securities and Exchange Commission nor any state
or Canadian provincial or territorial securities regulatory
authority has approved or disapproved the securities to be
issued in connection with the merger or determined if this proxy
statement/ prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.


This proxy statement/ prospectus is
dated                   ,
2005 and is expected to be first mailed to stockholders of
Mayors on or
about                   ,
2005.






| |                                                                       
| | ----------------------------------------------------------------------
| | Sincerely,                                                            
|
| | Marc Weinstein                                                        
| | Senior Vice President, Chief Administrative Officer, and
    Secretary
| | Mayors Jewelers, Inc.                                                



---



##### Table of Contents



MAYORS JEWELERS, INC.





NOTICE OF SPECIAL AND ANNUAL MEETING OF STOCKHOLDERS


TO BE HELD
ON                         ,
2005






| |   |                                                                                                                                                                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | To approve and adopt the Agreement and Plan of Merger and
    Reorganization, dated as of April 18, 2005, as amended as
    of July 27, 2005, among Henry Birks & Sons Inc.,
    Mayors and Birks Merger Corporation, a wholly-owned
    subsidiary of Henry Birks & Sons Inc., a copy of which
    is attached as Appendix A to the enclosed proxy statement/
    prospectus;
|
| |  | To elect one director of Mayors;                                                                                                                                                                                                                                                                                                                                              
|
| |  | To ratify the appointment of KPMG LLP as Mayors
    independent registered public accounting firm for the fiscal
    year ending March 25, 2006; and                                                                                                                                                                                                                          
|
| |  | To transact such other business as may properly come before the
    special and annual meeting.                                                                                                                                                                                                                                                                                



MAYORS BOARD OF DIRECTORS, UPON THE UNANIMOUS
RECOMMENDATION OF A SPECIAL COMMITTEE COMPRISED OF INDEPENDENT
MEMBERS OF THE BOARD OF DIRECTORS, RECOMMENDS THAT YOU VOTE IN
FAVOR OF THE PROPOSAL TO APPROVE AND ADOPT THE MERGER
AGREEMENT.


Please do not send any stock certificate you may have at this
time.


You should read carefully and in its entirety the attached
proxy statement/ prospectus which includes a copy of the merger
agreement.




| |                                    
| | -----------------------------------
| | By Order of the Board of Directors,
|
| | Marc Weinstein                     
| | Secretary                          





It is important that your shares be represented at the
special and annual meeting. Whether or not you plan to attend
the special and annual meeting, please submit your proxy
promptly by completing, dating and returning your proxy card in
the enclosed envelope. You may revoke your proxy at any time
until it is voted by a later dated proxy or by attending the
special and annual meeting and voting in person.




---










TABLE OF CONTENTS





|                                                                                                                                 |  |      |     | 
|-------------------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                                                                                                                                 |  | Page |    
|                                                                                                                                 |  |      |    
|PRESENTATION OF FINANCIAL AND OTHER
    INFORMATION                                                                              |  |      | 1   | 
|NOTICE TO READERS                                                                                                                |  |      | 1   | 
|QUESTIONS AND ANSWERS ABOUT THE MERGER                                                                                           |  |      | 2   | 
|SUMMARY                                                                                                                          |  |      | 5   | 
|COMPARATIVE PER SHARE DATA                                                                                                       |  |      | 15  | 
|MAYORS STOCK PRICES                                                                                                             |  |      | 16  | 
|DIVIDENDS                                                                                                                        |  |      | 17  | 
|RISK FACTORS                                                                                                                     |  |      | 18  | 
|CAUTIONARY STATEMENT CONCERNING
    FORWARD-LOOKING STATEMENTS                                                                   |  |      | 31  | 
|THE SPECIAL AND ANNUAL MEETING                                                                                                   |  |      | 32  | 
|THE MERGER                                                                                                                       |  |      | 37  | 
|MATERIAL U.S. FEDERAL INCOME TAX
    CONSEQUENCES OF THE MERGER                                                                  |  |      | 56  | 
|MATERIAL CANADIAN FEDERAL INCOME TAX
    CONSEQUENCES OF THE MERGER                                                              |  |      | 60  | 
|MERGER FEES, COSTS AND EXPENSES                                                                                                  |  |      | 61  | 
|NO DISSENTERS RIGHTS OF APPRAISAL                                                                                               |  |      | 61  | 
|STOCK EXCHANGE LISTING                                                                                                           |  |      | 62  | 
|RESALE OF BIRKS CLASS A VOTING
    SHARES                                                                                        |  |      | 62  | 
|THE MERGER AGREEMENT                                                                                                             |  |      | 63  | 
|COMPARISON OF STOCKHOLDER RIGHTS                                                                                                 |  |      | 72  | 
|SELECTED HISTORICAL FINANCIAL DATA OF
    BIRKS                                                                                  |  |      | 87  | 
|UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
    FINANCIAL INFORMATION OF BIRKS                                                    |  |      | 89  | 
|MANAGEMENTS DISCUSSION AND ANALYSIS
    OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF BIRKS                           |  |      | 96  | 
|DESCRIPTION OF BIRKS BUSINESS                                                                                                   |  |      | 112 | 
|MANAGEMENT OF BIRKS                                                                                                              |  |      | 120 | 
|CERTAIN RELATIONSHIPS AND RELATED PARTY
    TRANSACTIONS OF BIRKS                                                                |  |      | 134 | 
|OWNERSHIP OF BIRKS CLASS A VOTING
    SHARES                                                                                     |  |      | 137 | 
|DESCRIPTION OF BIRKS CAPITAL STOCK                                                                                              |  |      | 140 | 
|SELECTED HISTORICAL FINANCIAL DATA OF
    MAYORS                                                                                |  |      | 147 | 
|MANAGEMENTS DISCUSSION AND ANALYSIS
    OF THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
    MAYORS                     |  |      | 150 | 
|DESCRIPTION OF MAYORS BUSINESS                                                                                                  |  |      | 160 | 
|MANAGEMENT OF MAYORS                                                                                                            |  |      | 171 | 
|OWNERSHIP OF MAYORS VOTING
    SECURITIES                                                                                       |  |      | 187 | 
|LEGAL MATTERS                                                                                                                    |  |      | 189 | 
|EXPERTS                                                                                                                          |  |      | 189 | 
|STOCKHOLDER PROPOSALS                                                                                                            |  |      | 189 | 
|ENFORCEABILITY OF CIVIL LIABILITIES                                                                                              |  |      | 190 | 
|WHERE YOU CAN FIND MORE INFORMATION                                                                                              |  |      | 190 | 
|INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
    OF BIRKS AND MAYORS                                                              |  |      | F-1 | 
|Appendix A  Agreement and Plan
    of Merger and Reorganization, dated as of
    April 18, 2005, as amended as of July 27, 2005 |  |      |     | 
|Appendix B  Opinion of Houlihan
    Lokey Howard & Zukin                                                                        |  |      |     | 
|EX-5.1                                                                                                                          
|EX-8.1                                                                                                                          
|EX-10.10                                                                                                                        
|EX-23.1                                                                                                                         
|EX-23.2                                                                                                                         
|EX-23.3                                                                                                                         
|EX-23.6                                                                                                                         









You should rely only on the information contained in this
document to vote on the merger. Neither Birks nor Mayors
has authorized anyone to provide you with information that is
different from what is contained in this document.









---



##### Table of Contents






PRESENTATION OF FINANCIAL AND OTHER INFORMATION














|        |  |                   |        |  |           |   |        |           |  |   |           |  |  |           |        |  |  |   |        | 
|------- |  | ----------------- | ------ |  | --------- | - | ------ | --------- |  | - | --------- |  |  | --------- | ------ |  |  | - | ------ | 
|        |  | Fiscal Year Ended |       
|        |  |                   |       
|        |  | March 31,         |        |  | March 30, |   |        | March 29, |  |   | March 27, |  |  | March 26, |       
|        |  | 2001              |        |  | 2002      |   |        | 2003      |  |   | 2004      |  |  | 2005      |       
|        |  |                   |        |  |           |   |        |           |  |   |           |  |  |           |       
|Average |  | $                 | 0.6648 |  |           | $ | 0.6390 |           |  | $ | 0.6450    |  |  | $         | 0.7377 |  |  | $ | 0.7810 | 




|     |  |            |        |  |            |   |        |          |  |   |           |  |  |           |        |  |             |   |        |  |  |   |        | 
|---- |  | ---------- | ------ |  | ---------- | - | ------ | -------- |  | - | --------- |  |  | --------- | ------ |  | ----------- | - | ------ |  |  | - | ------ | 
|     |  | Month      |       
|     |  |            |       
|     |  | March 2005 |        |  | April 2005 |   |        | May 2005 |  |   | June 2005 |  |  | July 2005 |        |  | August 2005 |  
|     |  |            |        |  |            |   |        |          |  |   |           |  |  |           |        |  |             |  
|High |  | $          | 0.8322 |  |            | $ | 0.8233 |          |  | $ | 0.8082    |  |  | $         | 0.8159 |  |             | $ | 0.8300 |  |  | $ | 0.8412 | 
|Low  |  | $          | 0.8024 |  |            | $ | 0.7957 |          |  | $ | 0.7872    |  |  | $         | 0.7950 |  |             | $ | 0.8041 |  |  | $ | 0.8207 | 







NOTICE TO READERS




1



---



##### Table of Contents






QUESTIONS AND ANSWERS ABOUT THE MERGER




When used in this section, as in the other sections of
this proxy statement/ prospectus, Birks refers to
Henry Birks & Sons Inc. and its subsidiaries, including
Mayors.




|    |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Q1: |  | What am I being asked to vote on?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|A1: |  | You are being asked to vote to approve and adopt the Agreement
    and Plan of Merger and Reorganization dated as of April 18,
    2005, as amended as of July 27, 2005, which is referred to
    in this proxy statement/ prospectus as the merger agreement,
    among Birks, Mayors and Birks Merger Corporation, a
    newly-formed, wholly-owned subsidiary of Birks. In this proxy
    statement/ prospectus, Birks Merger Corporation is referred to
    as Merger Co. As a result of the merger, Mayors will
    become a wholly-owned subsidiary of Birks. Additionally, upon
    consummation of the merger, Birks intends to change its name to
    Birks & Mayors Inc.
|   
|Q2: |  | What will I receive in the merger?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   
|A2: |  | In the merger, each share of your Mayors common stock will
    be converted into the right to receive 0.08695 Class A
    voting shares of Birks, which is referred to in this proxy
    statement/ prospectus as the exchange ratio. The special
    committee and Mayors board of directors received an
    opinion from the financial advisor to the special committee,
    Houlihan Lokey Howard & Zukin, which is referred to in
    this proxy statement/ prospectus as Houlihan Lokey, that the
    exchange ratio was, as of the date of the opinion, fair from a
    financial point of view to Mayors stockholders.                                                      
|   
|    |  | You will not receive any fractional Class A voting shares
    of Birks in the merger. Instead, Birks will pay you cash for any
    fractional Birks Class A voting shares you would have
    otherwise received.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|    |  | For example, if you own 100 shares of Mayors common
    stock, you will receive 8 Birks Class A voting shares plus
    a cash payment equal to 0.695, the remaining fractional interest
    in Birks Class A voting shares you would otherwise have
    received, multiplied by the average closing price of Birks
    Class A voting shares as reported by the American Stock
    Exchange in the 20 consecutive trading days beginning on and
    including the trading day immediately following the date of the
    effective time of the merger, which if the average trading price
    is $6.25 per share, would equal $4.34 in cash.                                          
|   
|   
|Q3: |  | What happens if I do not vote?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   
|   
|   
|A3: |  | Because Birks controls a majority of Mayors outstanding
    voting stock, Birks will be able to ensure that holders of a
    majority of Mayors voting stock approve the merger.
    Nevertheless, approval and adoption of the merger requires the
    affirmative vote of disinterested stockholders who vote their
    shares at the special and annual meeting. Therefore, as a
    disinterested stockholder, your vote is important and a failure
    to vote will reduce the number of votes of disinterested
    stockholders required to approve or reject the merger.                                                                                                     
|   
|   
|   
|Q4: |  | Can the number of Birks Class A voting shares to be
    issued in the merger for each share of Mayors common stock
    change between now and the time the merger is completed?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   
|   
|   
|A4: |  | No. The exchange ratio is a fixed ratio, which means that
    it will not change even if the trading price of Mayors
    common stock changes between now and the time the merger is
    completed. See Risk Factors beginning on
    page 18.                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   

2



---



##### Table of Contents





|     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|Q5:  |  | When do you expect the merger to be completed?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    
|    
|    
|A5:  |  | We expect to complete the merger as promptly as practicable
    after we receive Mayors stockholder approval at the
    special and annual meeting. We currently anticipate closing the
    transaction in the fourth calendar quarter of 2005.                                                                                                                                                                                                                                                                                                                                                                                                                   
|    
|    
|    
|Q6:  |  | What do I need to do now?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    
|    
|    
|A6:  |  | After carefully reading and considering the information
    contained in this proxy statement/ prospectus, please fill out,
    sign and date the proxy card, and then mail your signed proxy
    card in the enclosed prepaid envelope as soon as possible so
    that your shares may be voted at the special and annual meeting.                                                                                                                                                                                                                                                                                                                                
|    
|    
|    
|Q7:  |  | If my shares are held in street name by my
    broker, will my broker vote my shares for me?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    
|    
|    
|A7:  |  | You should instruct your broker to vote your shares. Please
    check with your broker and follow the voting procedures your
    broker provides. Your broker will advise you whether you may
    submit voting instructions by telephone or Internet. If you do
    not instruct your broker, your broker will generally not have
    the discretion to vote your shares without your instructions.                                                                                                                                                                                                                                                               
|    
|    
|    
|Q8:  |  | May I change my vote after I have mailed my signed proxy
    card?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    
|    
|    
|A8:  |  | Yes. You may change your vote at any time before your proxy is
    voted at the special and annual meeting. You can do this in
    several ways. You can send a written notice stating that you
    want to revoke your proxy, or you can complete and submit a new
    proxy card.                                                                                                                                                                                                                                                                                                                                                                                
|    
|    
|    
|     |  | If you are a holder of record, you can also attend the special
    and annual meeting and vote in person. Simply attending the
    special and annual meeting, however, will not revoke your proxy;
    you must vote at the special and annual meeting.                                                                                                                                                                                                                                                                                                                                                                                                           
|    
|    
|     |  | If you have instructed a broker to vote your shares, you must
    follow the voting procedures received from your broker to change
    your vote.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    
|    
|Q9:  |  | If I want to attend the special and annual meeting, what do I
    do?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    
|    
|    
|A9:  |  | You must come to the Renaissance Hotel, 1230 South Pine Island
    Road, Plantation, Florida 33324 at 10:00 a.m., local time,
    on                     ,
    2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    
|    
|    
|Q10: |  | Should I send in my stock certificates now?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    
|    
|    
|A10: |  | No. If the merger is completed and you hold any
    Mayors stock certificates, you will receive written
    instructions from Birks for exchanging those Mayors stock
    certificates for certificates representing Birks Class A
    voting shares. You may not have received any stock certificates
    because your shares of Mayors common stock were directly
    registered. The written instructions you will receive will
    advise you what to do if your shares were directly registered.                                                                                                                                                           
|    
|    
|    
|Q11: |  | What if I cannot find my stock certificate?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    
|    
|    
|A11: |  | There will be a procedure for you to receive Birks Class A
    voting shares in the merger even if you lost one or more of your
    Mayors stock certificates. This procedure, however, may
    take time to complete. In order to ensure that you will be able
    to receive your Birks Class A voting shares promptly after
    the merger is completed, if you cannot locate your Mayors
    stock certificates after looking for them carefully, we urge you
    to contact Mayors transfer agent, SunTrust Bank, as soon
    as possible and follow the procedure for replacing your
    Mayors stock certificates. Letitia Radford, Mayors
    SunTrust
|    

3



---



##### Table of Contents



|     |  |                                                                                                                                                                                                                              
|---- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |  | Bank representative, can be reached at 404-588-7817, or you can
    write to SunTrust Bank at the following address:                                                                                                         
|    
|     |  | SunTrust Bank 
     58 Edgewood Avenue, Suite 225 
     Atlanta, GA 30303 
     Attention: Ms. Letitia Radford                                                                                                               
|    
|    
|Q12: |  | Can I dissent and require appraisal of my shares?                                                                                                                                                                            
|    
|    
|    
|A12: |  | No. Under the Delaware General Corporation Law,
    Mayors stockholders are not entitled to appraisal rights
    in connection with the merger. See The Merger 
    No Appraisal Rights.                                 
|    
|    
|    
|Q13: |  | Are there risks I should consider in deciding whether to vote
    for the merger?                                                                                                                                            
|    
|    
|    
|A13: |  | Yes. We have set forth in the section entitled Risk
    Factors beginning on page 18 of this proxy statement/
    prospectus a number of risk factors that you should consider
    carefully in connection with the merger.
|    
|    
|    
|Q14: |  | Who can help answer my additional questions about the
    merger?                                                                                                                                                            
|    
|    
|    
|A14: |  | If you have questions about the merger, you should contact:                                                                                                                                                                  
|    
|    
|    
|     |  | Georgeson Shareholder Communications Inc. 
     17 State St.,
    28th
    Floor 
     New York, New York 10004 
     Banks and Brokers call: (212) 404-9800 
     All others call Toll-free: (800) 279-8717                 
|    
|    
|     |  | or                                                                                                                                                                                                                           
|    
|     |  | Marc Weinstein 
     Senior Vice President, Chief Administrative Officer, and
    Secretary 
     Mayors Jewelers, Inc. 
     14051 N.W.
    14th Street,
    Suite 200 
     Sunrise, Florida 33323 
     (954) 846-2701   

4



---



##### Table of Contents



SUMMARY
 
 This summary highlights selected information from this proxy
statement/ prospectus. It does not contain all of the
information that may be important to you. You should carefully
read this entire proxy statement/ prospectus and the other
documents to which this document refers, for a more complete
understanding of the matter being considered at the special and
annual meeting. See Where You Can Find More
Information on page 190.
 
 
 Unless we have otherwise stated or the context otherwise
requires, all references in this proxy statement/ prospectus to
Birks are to Henry Birks & Sons Inc. and
its subsidiaries, which includes Mayors Jewelers, Inc. and
its subsidiaries; all references to Mayors are
to Mayors Jewelers, Inc. and its subsidiaries; all
references to Merger Co. are to Birks
wholly-owned subsidiary Birks Merger Corporation; all references
to dollars or $ or US$ are
to U.S. dollars; all references to Cdn$ are to
Canadian dollars; all references to the merger
agreement are to the Agreement and Plan of Merger and
Reorganization, dated as of April 18, 2005, as amended as
of July 27, 2005, attached to this proxy statement/
prospectus as Appendix A; all references to
Mayors common stock are to Mayors
common stock, par value $0.0001 per share; all references
to Mayors preferred stock are to Mayors
Series A-1 Convertible Preferred Stock; and all references
to Mayors voting stock are to Mayors
common stock and Mayors preferred stock combined.
 
 The Companies
  Henry Birks & Sons Inc. 
  
   Birks Merger Corporation   Mayors Jewelers, Inc.


5



---



##### Table of Contents



Recent Developments
  Restatement


6



---



##### Table of Contents



Appointment of Chief Financial Officer 
  
 
 Comparative Per-Share Market Price (Page 15)
 
   
  
 The Special and Annual Meeting
 When and Where.
 Purposes of the Special and Annual Meeting.
 Who Can Vote at the Special and Annual Meeting
 Record Date; Voting Power.


7



---



##### Table of Contents



Required Vote for Matters at the Special and Annual
Meeting
 Merger Agreement.
 Election of Director.
 Ratify the Appointment of KPMG LLP.
  
 The Merger (Page 37)


8



---



##### Table of Contents



PRE-MERGER STRUCTURE
 
 
  
  (FLOW CHART)


9



---



##### Table of Contents



POST-MERGER STRUCTURE
 
 
  
 
 
 Risk Factors (Page 18)
 
 
  
 
 Recommendation of the Special Committee and Mayors
Board of Directors (Page 43)


10



---



##### Table of Contents



Opinion of the Financial Advisor to the Special Committee
(Page 46)
 
  
 Interests of Mayors Executive Officers and Directors in
the Merger (Page 53)
 
 
  
 
 Material U.S. Federal Income Tax Consequences of the
Merger and of Owning Birks Class A Voting Shares
(Page 56)
 
 
  
  
 Material Canadian Federal Income Tax Consequences of the
Merger (Page 60)


11



---



##### Table of Contents



Accounting Treatment
  
 The Merger Agreement (Page 63)
 
 
  
 
 Conditions to the Merger (Page 68)
 
   
    the registration statement, of which this proxy statement/
    prospectus is a part, having been declared effective under the
    Securities Act of 1933, and no stop order or proceeding seeking
    a stop order being pending by or before the Securities and
    Exchange Commission, which is referred to in this
    proxy statement/ prospectus as the SEC;
    Mayors disinterested stockholders having affirmatively
    voted to approve and adopt the merger agreement by the requisite
    vote;
    no injunction, order or other legal restraint or prohibition
    preventing the consummation of the merger being in effect;
    Birks Class A voting shares having been authorized for
    listing on the American Stock Exchange; and
    the fairness opinion obtained from the special committees
    financial advisor not having been withdrawn, revoked, annulled
    or materially modified.   
    the other party having performed in all material respects its
    obligations under the merger agreement, the other partys
    representations and warranties in the merger agreement being
    true and correct in all material respects as of the closing of
    the merger and the delivery of officers certificates of
    Mayors and Birks, respectively, certifying satisfaction of
    such conditions; and
    any regulatory and third-party approvals that are required to
    consummate the merger having been obtained. The merger is not
    subject to the reporting and waiting period provisions of the
    Hart-Scott-Rodino Antitrust Improvements Act of 1976.   
    Mayors not being subject to a material adverse effect as
    defined in the merger agreement; and
    additional warrants to purchase Mayors common stock having
    been issued to Joseph A. Keifer, Senior Vice President and
    Chief Operating Officer of Mayors, Marco Pasteris, Group
    Vice President


12



---



##### Table of Contents



for Finance of Birks and Mayors, and Carlo Coda-Nunziante,
    Group Vice President for Strategy and Business Development of
    Birks and Mayors. 
   
    Mayors having received an opinion from Holland &
    Knight LLP or King & Spalding LLP that (i) the
    merger will qualify as a reorganization within the meaning of
    Section 368(a) of the Code and each of Birks and
    Mayors will be a party to the reorganization, and
    (ii) the conversion of Mayors common stock into Birks
    Class A voting shares in the merger will not result in the
    recognition of gain under Section 367 of the Code (except,
    under certain circumstances, in the case of a person who owns,
    actually or constructively, 5% or more of the voting power or
    value of the outstanding stock of Birks following the merger);
    Mayors having obtained the affirmative vote of the
    required majority of Mayors voting stock in favor of the
    merger at Mayors stockholders meeting;
    Birks Articles of Amalgamation and Birks By-laws
    being amended as specified in the merger agreement, each
    document, as amended, being referred to in this proxy statement/
    prospectus as Birks amended charter and Birks
    amended by-laws, respectively;
    Birks not being subject to a material adverse effect, as defined
    in the merger agreement;
    all of the issued and outstanding Series A preferred shares
    of Birks and $5,000,000 aggregate principal amount of secured
    convertible notes of Birks having been converted into Birks
    Class A voting shares and Birks Class B multiple
    voting shares;
    warrants to purchase Mayors common stock having been
    amended to eliminate the application of anti-dilution
    provisions; and
    the employment agreement or other documents between Birks and
    Thomas A. Andruskevich having been amended to eliminate the
    application of certain anti-dilution provisions to the future
    issuance of stock-based compensation after the merger is
    consummated. 
  
 
 Termination (Page 70)
 
   
    the merger is not consummated by December 31, 2005, unless
    the party seeking to terminate the merger agreement has failed
    to comply with the merger agreement and that failure has been
    the cause of, or resulted in, the failure of the merger to occur
    on or before December 31, 2005;
    any governmental entity issues an order or injunction or other
    legal restraint or prohibition preventing consummation of the
    merger;
    Mayors stockholders fail to approve and adopt the merger
    agreement at the special and annual meeting (or any adjournment
    or postponement of the special and annual meeting); or
    the other party breaches the merger agreement, the breach would
    prevent satisfaction of a closing condition and the breach is
    not reasonably capable of being cured or is not cured prior to
    15 days after receipt of written notice of the breach.


13



---



##### Table of Contents




    Mayors board of directors or the special committee
    withdraws, modifies or changes, in any manner adverse to Birks,
    its recommendation that the stockholders of Mayors vote in
    favor of the approval and adoption of the merger agreement, or
    resolved to do so; or
    the special committees financial advisor withdraws or
    materially modifies its fairness opinion.  
 Comparison of Stockholder Rights (Page 72)
 
  
 Birks Capital Stock (Page 72)


14



---



##### Table of Contents



COMPARATIVE PER SHARE DATA
   As of and for theFiscal Year EndedMarch 26, 2005Book Value Per Share at Period EndBirks historical
    
    $
    5.41Birks pro forma(1)
    
    $
    5.80Mayors common share historical(2)
    
    $
    0.52Mayors common share pro forma equivalent(3)
    
    $
    0.50Mayors preferred share historical(4)
    
    $
    1,000Dividends Per ShareBirks historical(5)
    
    
    Birks pro forma(1)
    
    
    Mayors common share historical(6)
    
    
    Mayors common share pro forma equivalent(2)
    
    
    Mayors preferred share historical
    
    $
    6.67Basic Net Income Per Share from Continuing OperationsBirks historical
    
    $
    0.16Birks pro forma(1)
    
    $
    0.13Mayors common share historical
    
    $
    0.02Mayors common share pro forma equivalent(2)
    
    $
    0.01Diluted Net Income Per Share from Continuing OperationsBirks historical
    
    $
    0.13Birks pro forma(1)
    
    $
    0.12Mayors common share historical
    
    $
    0.01Mayors common share pro forma equivalent(2)
    
    $
    0.01 
  (1)
    The Birks pro forma per share amounts were determined after
    giving effect to the appropriate pro forma adjustments. See
    Unaudited Pro Forma Condensed Consolidated Financial
    Information of Birks.(2)
    Excludes the liquidation value of the Series A-1
    Convertible Preferred Stock.(3)
    The Mayors pro forma equivalent per share amounts are
    calculated by multiplying the Birks pro forma per share amounts
    by the exchange ratio of 0.08695.(4)
    Based on the liquidation value of the Series A-1
    Convertible Preferred Stock.(5)
    Historically, Birks has not paid a cash dividend on its common
    shares.(6)
    Historically, Mayors has not paid a cash dividend on its
    common stock.


15



---



##### Table of Contents



MAYORS STOCK PRICES
   
 High
    
    LowThirteen Weeks Ended September 24, 2005 (through
    September 6, 2005)
    
    
    $0.58
    
    
    
    $0.51Thirteen Weeks Ended June 25, 2005
    
    
    0.66
    
    
    
    0.53Year Ended March 26, 2005Thirteen Weeks Ended March 26, 2005
    
    
    $0.77
    
    
    
    $0.58Thirteen Weeks Ended December 25, 2004
    
    
    0.72
    
    
    
    0.55Thirteen Weeks Ended September 25, 2004
    
    
    0.88
    
    
    
    0.61Thirteen Weeks Ended June 26, 2004
    
    
    0.84
    
    
    
    0.54Year Ended March 27, 2004Thirteen Weeks Ended March 27, 2004
    
    
    $0.95
    
    
    
    $0.66Thirteen Weeks Ended December 27, 2003
    
    
    0.85
    
    
    
    0.60Thirteen Weeks Ended September 27, 2003
    
    
    0.98
    
    
    
    0.21Thirteen Weeks Ended June 28, 2003
    
    
    0.35
    
    
    
    0.18Year Ended March 29, 2003Thirteen Weeks Ended March 29, 2003
    
    
    $0.31
    
    
    
    $0.21Thirteen Weeks Ended January 4, 2003
    
    
    0.40
    
    
    
    0.28Thirteen Weeks Ended October 5, 2002
    
    
    0.50
    
    
    
    0.20Thirteen Weeks Ended July 6, 2002
    
    
    1.42
    
    
    
    0.13


16



---



##### Table of Contents



DIVIDENDS


17



---



##### Table of Contents






RISK FACTORS





In addition to the other information included in this proxy
statement/ prospectus, including the matters addressed under the
caption Cautionary Statement Concerning Forward-Looking
Statements on page 31, you should carefully consider
the matters described below. The risks described below describe
all material risks that are currently known or reasonably
foreseeable by Birks.





Risks Related to the Terms of the Merger




| |                                                                                                                                                                                                                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Because (1) the exchange ratio is fixed, (2) the
    market price of Mayors common stock will fluctuate and
    (3) Birks Class A voting shares are not publicly
    traded, you cannot be certain of the dollar value of the merger
    consideration that you, as a Mayors stockholder, will
    receive in the merger.







| |   |                                                                          
| | - | -------------------------------------------------------------------------
| |  | changes in the business, operations or prospects of Birks or
    Mayors;
|
| |  | economic conditions and the outlook for economic
    conditions; and     
|
| |  | the timing of the consummation of the merger.                            



| |                                                                                                                                                                                                          
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The fairness opinion provided by Houlihan Lokey was given
    as of the date the merger agreement was approved by the special
    committee and does not reflect subsequent changes in
    circumstances.





| |                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------
| | The fairness opinion provided by Houlihan Lokey is based
    on various assumptions and is subject to various
    limitations.



18



---



##### Table of Contents







| |                                                                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks and Mayors may experience difficulties in
    completing the integration of Mayors business with the
    existing Birks businesses and will incur significant transaction
    expenses in connection with the merger.





| |                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------
| | Birks and Mayors may not achieve the cost savings
    and increased net sales they have anticipated for the combined
    company.



Risks Related to Birks Class A Voting Shares




| |                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------
| | Birks share price could be adversely affected if a
    large number of Birks Class A voting shares are offered for
    sale or sold.





19



---



##### Table of Contents





| |                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------
| | Birks Class A voting shares have no prior trading
    history, which may adversely affect the liquidity and value of
    such shares.





| |                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | As a retail jeweler with a limited public float, the price
    of Birks Class A voting shares may fluctuate substantially,
    which could negatively affect the value of Birks Class A
    voting shares and could result in securities class action claims
    against Birks.









| |                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks is governed by the laws of Canada, and, as a result,
    it may not be possible for shareholders to enforce civil
    liability provisions of the securities laws of the United
    States.





| |                                                                                                                                                                                                                                                                                                          
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks expects to maintain its status as a foreign
    private issuer under the rules and regulations of the SEC
    and, thus, will be exempt from a number of rules under the
    Exchange Act and will be permitted to file less information with
    the SEC than a company incorporated in the U.S.



20



---



##### Table of Contents







| |                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Options to purchase Birks Class A voting shares held
    by Birks Chief Executive Officer contain anti-dilution
    provisions which could adversely affect the value of Birks
    Class A voting shares.








| |                                                                                                                                                                                                                                                      
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If Birks were treated as a passive foreign investment
    company, or a PFIC, some holders of Birks Class A voting
    shares would be subject to additional taxation, which could
    cause the price of Birks Class A voting shares to
    decline.












Risks Related to the Combined Company




| |                                                                                             
| | --------------------------------------------------------------------------------------------
| | Birks is controlled by a single shareholder whose
    interests may be different from yours.







| |                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------
| | If Birks is unable to implement its business strategy,
    Birks net sales and profitability may be adversely
    affected.



21



---



##### Table of Contents







| |                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks may pursue strategic acquisitions which may divert
    the attention of management and which may not be successfully
    integrated into Birks existing business.





| |                                                                                                   
| | --------------------------------------------------------------------------------------------------
| | If Birks is unable to introduce innovative products,
    Birks sales and market share may suffer.





| |                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------
| | Birks business could be adversely affected if its
    relationships with any of its primary vendors are
    terminated.





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks has experienced material weaknesses in its internal
    control over financial reporting. If Birks fails to maintain an
    effective system of internal controls, it may not be able to
    accurately report its financial results and its management may
    not be able to provide managements report on the
    effectiveness of Birks internal control over financial
    reporting as required by the Sarbanes-Oxley Act for the year
    ending March 25, 2007.



22



---



##### Table of Contents











| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Birks internal control policies and procedures over automated
    reporting systems and compensating manual processes are
    ineffective. The reconciliation of the accounts payable and
    inventory accounting sub-systems to the general ledger fails to
    appropriately capture all of the reconciling items. Furthermore,
    Birks does not perform a regular reconciliation of the
    intra-division accounts related to its jewelry factory, which
    results in a failure to properly capture, control, process and
    record adjustments.
|
| |  | Birks internal control policies and procedures over accounting
    for certain transactions and events in accordance with
    U.S. GAAP are ineffective, due to a lack of accounting
    personnel with adequate U.S. accounting knowledge and
    experience.                                                                                                                                                                                                                                                                                            







| |   |                                                                                                                                                                                                                                                                                                                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Mayors internal control policies and procedures over
    adjustments to inventory to the lower of cost or market do not
    ensure that adjustments were made in accordance with
    U.S. GAAP and, specifically, do not prevent the adjustment
    of certain aged inventory to below current book value without
    adequate documentation and support.                                                                   
|
| |  | Mayors internal control policies and procedures over the
    proper accounting for accrued legal expenses do not prevent the
    accrual of legal expenses (litigation costs, judgments and
    settlements) without adequate documentation and support.                                                                                                                                                                    
|
| |  | Mayors internal control policies and procedures over the
    proper accounting for related party transactions fail to
    capture, control, process and record expenses related to such
    transactions prior to the closing of the consolidated financial
    statements and issuance of a press release, and do not provide
    for the proper accounting of related party transactions in
    accordance with U.S. GAAP.



23



---



##### Table of Contents



















| |                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks is exposed to currency exchange risk that could have
    a material adverse effect on its results of operations and
    financial condition.



24



---



##### Table of Contents







| |                                                                      
| | ---------------------------------------------------------------------
| | Birks commodity price hedging activities could
    result in losses.





| |                                                                                                       
| | ------------------------------------------------------------------------------------------------------
| | Birks is subject to risks and costs associated with
    non-compliance with environmental regulations.





| |                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------
| | Birks manufacturing operations are dependent upon
    third-party suppliers, making Birks vulnerable to supply
    shortages.





| |                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------
| | Fluctuations in the availability and prices of Birks
    merchandise may adversely affect its results of
    operations.



25



---



##### Table of Contents







| |                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------
| | A significant disruption at Birks jewelry
    manufacturing facilities could have a material adverse effect on
    its results.





| |                                                                                                        
| | -------------------------------------------------------------------------------------------------------
| | Birks business is subject to many operational risks
    for which Birks may not be adequately insured.





| |                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------
| | Hurricanes could cause a disruption in Birks
    U.S. operations, which could have an adverse impact on
    Birks results of operations.





| |                                                                                                                                                          
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks may not be able to adequately protect its
    intellectual property and may be required to engage in costly
    litigation as a protective measure.



26



---



##### Table of Contents





| |                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------
| | Birks may not successfully manage its inventory, which
    could have an adverse effect on its net sales, profitability and
    liquidity.





| |                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------
| | The retail jewelry industry is highly competitive and
    Birks may not be able to grow or maintain its market
    share.








| |                                                                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | If the Canadian retail jewelry market does not grow at or
    above currently anticipated levels, Birks results of
    operations may be adversely affected and the price of Birks
    Class A voting shares may decline.














| |                                                                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks quarterly operations results will fluctuate
    due to seasonality and other factors, and variation in quarterly
    results could cause the price of Birks Class A voting
    shares to decline.



27



---



##### Table of Contents







| |                                                                                                            
| | -----------------------------------------------------------------------------------------------------------
| | As a luxury retail jeweler, Birks business is
    particularly susceptible to adverse economic conditions.













| |                                                                                                             
| | ------------------------------------------------------------------------------------------------------------
| | Birks has significant indebtedness, which could adversely
    affect its operations and financial condition.



|                                                    |  |   |             |  
|--------------------------------------------------- |  | - | ----------- | -
|Total indebtedness                                  |  | $ | 107,147,000 |  
|Total shareholders equity                          |  | $ | 65,730,000  |  
|                                                    |  |   |            
|Total capitalization                                |  | $ | 172,877,000 |  
|                                                    |  |   |            
|Ratio of total indebtedness to total capitalization |  |   | 61.9        | %





| |   |                                                                                                                                                                                                                                                  
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | make it more difficult for Birks to satisfy its obligations with
    respect to its indebtedness;                                                                                                                                                
|
| |  | increase its vulnerability to adverse economic and industry
    conditions;                                                                                                                                                                      
|
| |  | require Birks to dedicate a substantial portion of cash from
    operations to the payment of debt service, thereby reducing the
    availability of cash to fund working capital, capital
    expenditures and other general corporate purposes;
|
| |  | limit Birks ability to obtain financing for working
    capital, capital expenditures, general corporate purposes or
    acquisitions;                                                                                                          
|
| |  | place Birks at a disadvantage compared to Birks
    competitors that have a lower degree of leverage; and                                                                                                                                       
|
| |  | limit Birks flexibility in planning for, or reacting to,
    changes in its business and in the retail jewelry industry.                                                                                                                        



28



---



##### Table of Contents





| |                                                                                                                                                                 
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks will require a significant amount of cash to service
    its indebtedness. Birks ability to generate cash depends
    on many factors beyond its control.





| |                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------
| | Birks credit business may be adversely affected by
    changes in laws and regulations governing its business.





| |                                                                                 
| | --------------------------------------------------------------------------------
| | Birks may not be able to retain key personnel or replace
    them if they leave.





| |                                                                                                                 
| | ----------------------------------------------------------------------------------------------------------------
| | Birks business could be adversely affected if it is
    unable to successfully negotiate favorable lease terms.





| |                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Birks predecessor filed for bankruptcy protection in
    1993, which could have an adverse effect on Birks
    relationships with certain creditors and vendors.



29



---



##### Table of Contents







| |                                                                                                            
| | -----------------------------------------------------------------------------------------------------------
| | Mayors is the subject of an informal SEC inquiry,
    which could have a material adverse effect on Birks.





| |                                                                                               
| | ----------------------------------------------------------------------------------------------
| | Terrorist acts or other catastrophic events could have a
    material adverse effect on Birks.



30



---



##### Table of Contents






CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS








| |   |                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------
| |  | future results of operations, liquidity and financial position;                                                     
|
| |  | fluctuation in the market price of Mayors common stock or
    Birks Class A voting shares;                         
|
| |  | difficulties in integrating Birks and Mayors and in
    achieving anticipated cost savings;                        
|
| |  | difficulties in implementing Birks business strategy,
    including with respect to the merger;                    
|
| |  | future litigation or regulatory action;                                                                             
|
| |  | fluctuation in interest rates, exchange rates and prices of
    commodities;                                        
|
| |  | changes in the competitive landscape;                                                                               
|
| |  | Birks ability to effectively source and manufacture
    merchandise for its stores;                                
|
| |  | interruption in the supply chain;                                                                                   
|
| |  | relationships with Birks vendors;                                                                                  
|
| |  | protection of intellectual property;                                                                                
|
| |  | ability to properly manage inventory;                                                                               
|
| |  | ability to renew leases;                                                                                            
|
| |  | ability to withstand seasonal fluctuations;                                                                         
|
| |  | ability to effectively identify and remedy deficiencies in
    Birks internal control over financial reporting; and
|
| |  | the impact of adverse economic conditions and future
    catastrophic events.                                       





31



---



##### Table of Contents






THE SPECIAL AND ANNUAL MEETING


General; Date; Time and Place






Purposes of the Special and Annual Meeting






| |   |                                                                                                                                                      
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------
| |  | To approve and adopt the merger agreement;                                                                                                           
|
| |  | To elect one director of Mayors;                                                                                                                    
|
| |  | To ratify the appointment of KPMG LLP as Mayors
    independent registered public accounting firm for the fiscal
    year ending March 25, 2006; and
|
| |  | To transact such other business as may properly come before the
    special and annual meeting.                                                      





|            |                                              
|----------- | ---------------------------------------------
|Proposal 1: | Approval and Adoption of the Merger Agreement









32



---



##### Table of Contents







|            |                      
|----------- | ---------------------
|Proposal 2: | Election Of Directors











|            |                                                                                    
|----------- | -----------------------------------------------------------------------------------
|Proposal 3: | Ratify the Appointment of Mayors Independent Registered
    Public Accounting Firm





Record Date; Voting Power




33



---



##### Table of Contents









Required Vote


Approval of Merger Agreement.


Election of Director.


Ratify the Appointment of KPMG LLP.






34



---



##### Table of Contents







Quorum




How to Vote














Revocation of Proxy










Expenses of Solicitation




35



---



##### Table of Contents





Questions About Voting Your Shares










Miscellaneous





th







36



---



##### Table of Contents






THE MERGER


Background of the Merger


















37



---



##### Table of Contents



























38



---



##### Table of Contents

























39



---



##### Table of Contents





















40



---



##### Table of Contents

































41



---



##### Table of Contents

















42



---



##### Table of Contents

















| |   |                                                                                                                                                                                                                                                                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | agree that Mayors will grant 125,752 additional warrants
    to purchase Mayors common stock to Joseph A. Keifer,
    Senior Vice President and Chief Operating Officer of
    Mayors, Marco Pasteris, Group Vice President for Finance
    of Birks and Mayors, and Carlo Coda-Nunziante, Group Vice
    President for Strategy and Business Development of Birks and
    Mayors;
|
|
| |  | eliminate certain anti-dilutive provisions in the warrants to
    purchase Mayors common stock;                                                                                                                                                                                                                                                                                       

43



---



##### Table of Contents





| |   |                                                                                                                                              
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------
| |  | revise Birks amended by-laws to provide that a quorum
    shall be based on voting power; and                                               
|
| |  | revise Birks amended charter to require approval of the
    holders of Birks Class B multiple voting shares for future
    equity issuances.

Recommendation of Mayors Board of Directors






Mayors Reasons for the Merger and Negative Factors
Considered












| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Houlihan Lokey rendered its opinion in writing on April 18,
    2005 that the exchange ratio was, as of that date, fair from a
    financial point of view to holders of shares of Mayors
    common stock, other than Birks and its affiliates and associates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | The terms of the transaction were determined through
    arms-length negotiations between the special committee and
    Birks and their respective legal and financial advisors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | Greater geographic diversification should reduce impact of
    regional issues (e.g., hurricanes) on the combined
    companys results of operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | It is a condition to closing that the merger agreement be
    approved by a majority of Mayors disinterested
    stockholders, which excludes Birks and each person that is an
    affiliate or associate of Birks, that cast a vote, in person or
    by proxy, at the special and annual meeting. Directors of
    Mayors who are not affiliates or associates of Birks are
    considered disinterested stockholders for purposes of voting on
    the merger agreement. These directors (Emily Berlin, Elizabeth
    M. Eveillard, Massimo Ferragamo, Stephen M. Knopik, Judith
    MacDonald and Ann Spector Lieff) collectively, together with
    their associates and affiliates, beneficially own approximately
    1.9 million shares, or 5.0% of Mayors common stock.
    These directors have indicated that they plan to vote their
    shares in favor of the merger agreement, and their votes will
    count in determining whether a majority of Mayors
    disinterested stockholders has approved the merger.
|
| |  | The merger should simplify the corporate ownership structure of
    Mayors and increase transparency for investors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

44



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The Mayors preferred stock currently owned by Birks will
    no longer be senior to the common shareholders in the combined
    companys capital structure and the anti-dilution
    provisions of the preferred stock will be eliminated.                                                                                                                                                                                                       
|
| |  | The merger should eliminate management and board of directors
    inefficiencies associated with managing current intercompany
    issues.                                                                                                                                                                                                                                                                                                         
|
| |  | The merger may result in potentially greater shareholder
    liquidity due to increased size of company, higher share price
    and potential to attract research coverage.                                                                                                                                                                                                                                                                        
|
| |  | The merger will allow Mayors stockholders to continue to
    participate in any potential growth of the combined company.                                                                                                                                                                                                                                                                                                                         
|
| |  | Mayors business should benefit from being able to more
    effectively take advantage of Birks manufacturing
    capabilities.                                                                                                                                                                                                                                                                                                                   
|
| |  | The merger will be tax free to U.S. holders of Mayors
    common stock under U.S. tax laws.                                                                                                                                                                                                                                                                                                                                                       
|
| |  | Birks has agreed that within twelve months of consummation of
    the merger its board of directors will be comprised of a
    majority of independent directors under the applicable
    definitions of the SEC and the American Stock Exchange.                                                                                                                                                                                                  
|
| |  | Mayors has the right to terminate the merger agreement if,
    among other reasons, the special committee or the board of
    directors changes its recommendation in favor of the merger
    agreement.                                                                                                                                                                                                                                          
|
| |  | Birks is obligated to reimburse Mayors for expenses in
    connection with the transaction in the event of a termination of
    the merger agreement arising out of the failure of Birks to
    become listed on the American Stock Exchange (should such
    failure be unrelated to Mayors) or Birks inability
    to have this proxy statement/ prospectus declared effective by
    the SEC (should such inability be unrelated to Mayors).
|
|
| |  | Birks amended charter and amended bylaws will offer
    minority shareholders certain protections, including:                                                                                                                                                                                                                                                                                                                                     
|



| |   |                                                                                                                                                                                                                                     
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Birks will not be permitted to consummate a business combination
    unless holders of the Class A voting shares receive the
    same consideration (on a per share basis) as holders of the
    Class B multiple voting shares; and
|
| |  | Certain related party transactions will require the approval of
    both a committee of independent directors of Birks and, in
    certain cases, the disinterested shareholders of Birks.                                          











| |   |                                                                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Mayors stockholders will be owners of a Canadian company
    rather than a U.S. company. There may be certain
    disadvantages related to this change, including:



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the requirement to pay withholding taxes on any dividends paid
    by Birks and the possible unavailability of foreign tax credits
    to offset these taxes;                                                                                                                                                                                                                                                                      
|
| |  | Birks will be a foreign private issuer for
    U.S. securities law purposes and, thus, will not be
    required to file periodic reports and financial statements with
    the SEC as frequently or as promptly as U.S. companies
    whose securities are registered under the Exchange Act, and it
    will be exempt from a number of U.S. securities rules
    including short-swing profit rules and
    Regulation F-D; and
|
| |  | Mayors stockholders will have different rights as
    shareholders of a Canadian company. See Comparison of
    Stockholder Rights.                                                                                                                                                                                                                                                                                             

45



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The exchange ratio is fixed and Birks is not currently a
    publicly traded company. For each of these reasons, Mayors
    stockholders cannot be certain of the dollar value of the merger
    consideration to be received in the merger.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| |  | The cost savings and revenue increases anticipated for Birks and
    Mayors as a combined company may not be achieved.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| |  | The growth rate of Mayors core market (the Southeastern
    United States) is expected to outpace the growth rate of
    Birks core market (Canada).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | Certain Birks options granted to the CEO of Birks contain
    anti-dilution provisions which increases the number of his
    options in the event of additional issuances of capital stock of
    Birks. Mayors existing common stock warrants issued to
    Birks in 2002 (and later assigned to members of Birks
    management) contain similar provisions which would continue to
    apply following the merger (the anti-dilutive provisions
    contained in the warrants have since been eliminated). Among
    other issues, the special committee considered that these
    anti-dilution provisions could, in certain circumstances,
    potentially misalign the interests of management with the
    interests of the other shareholders.
|
| |  | The Class B multiple voting shares held by Birks
    controlling shareholders carry greater voting rights per share
    than the Class A voting shares to be received by the
    Mayors stockholders.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 



THE SPECIAL COMMITTEE UNANIMOUSLY RECOMMENDED THAT
MAYORS BOARD OF DIRECTORS APPROVE THE MERGER AGREEMENT. AS
A RESULT, MAYORS BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS OF MAYORS VOTE FOR APPROVAL AND
ADOPTION OF THE MERGER AGREEMENT.


Opinion of the Financial Advisor to the Special Committee














46



---



##### Table of Contents











| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) reviewed Mayors annual reports on Form 10-K
    for the fiscal years ended February 2, 2002, March 29,
    2003 and March 27, 2004, as well as the Form 10-K/ A
    for the fiscal year ended March 27, 2004; the internally
    prepared monthly financial statements for (a) April through
    March of 2002 and 2003, (b) March through December of 2004,
    and (c) January and February 2005 and quarterly reports on
    Form 10-Q for the quarter and nine months ended
    December 25, 2004, which Mayors management identified
    as being the most current financial statements available;
|
| | (ii) reviewed Birks audited financial statements for
    the fiscal years ending February 2, 2002, March 29,
    2003 and March 27, 2004 and internally prepared financial
    statements for (a) the fiscal years ending February 2,
    2002, March 29, 2003 and March 27, 2004, (b) the
    period from March through December 2004 and (c) January and
    February 2005;                                                                                                                                                                                                                               
|
| | (iii) reviewed monthly CFO reports from both Birks and
    Mayors from the period April 2002 through February 2005;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| | (iv) reviewed Mayors and Birks financial
    projections for the fiscal year ending March 26, 2005, as
    well as summary projections for the fiscal years ending
    March 25, 2006 and March 31, 2007;                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | (v) reviewed the combined pro forma projected financial
    statements for Birks giving effect to the merger;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | (vi) reviewed the Fiscal Year 2004-2006 Strategic Plan
    documents for each of Mayors and Birks;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | (vii) reviewed a draft of the merger agreement, draft dated
    April 14, 2005;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| | (viii) reviewed a draft of Birks amended charter and
    amended by-laws;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (ix) reviewed a draft of this proxy statement/ prospectus
    dated April 6, 2005;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | (x) met with certain members of the senior management of
    Mayors and Birks to discuss the respective operations,
    financial condition, future prospects and projected operations
    and performance of Mayors and Birks, and met with
    representatives of Birks commercial bankers to discuss
    certain matters;                                                                                                                                                                                                                                                                              
|
| | (xi) visited certain facilities and business offices of
    Mayors and Birks;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | (xii) reviewed the historical market prices and trading
    volume for Mayors publicly traded securities;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

47



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (xiii) reviewed certain other publicly available financial
    data for certain companies that Houlihan Lokey deemed comparable
    to Mayors, and publicly available prices and premiums paid
    in other transactions that Houlihan Lokey considered similar to
    the merger; and
|
| | (xiv) conducted such other studies, analyses and inquiries
    as Houlihan Lokey deemed appropriate.                                                                                                                                                                                   




Summary of financial analyses performed by Houlihan
Lokey.
































Market Multiple Methodology.















| |                                                                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (i) latest twelve months (LTM), projected next
    fiscal year (NFY), and the projected following
    fiscal year (NFY+1) earnings before interest, taxes,
    depreciation and amortization (EBITDA); and
|
|
|
| | (ii) LTM, NFY, and NFY+1 revenues.                                                                                                                                                                                
|









48



---



##### Table of Contents











|       |  |             |      |  |            |  |      |       |  |  |      |  |  |     |       |  |       |  |       |  |  |  |      | 
|------ |  | ----------- | ---- |  | ---------- |  | ---- | ----- |  |  | ---- |  |  | --- | ----- |  | ----- |  | ----- |  |  |  | ---- | 
|       |  | EV/ Revenue |      |  | EV/ EBITDA | 
|       |  |             |      |  |            | 
|       |  | LTM         |      |  | NFY        |  |      | NFY+1 |  |  | LTM  |  |  | NFY |       |  | NFY+1 | 
|       |  |             |      |  |            |  |      |       |  |  |      |  |  |     |       |  |       | 
|Low    |  |             | 0.4x |  |            |  | 0.7x |       |  |  | 0.7x |  |  |     | 5.5x  |  |       |  | 7.1x  |  |  |  | 6.2x | 
|High   |  |             | 2.6x |  |            |  | 2.3x |       |  |  | 1.1x |  |  |     | 12.2x |  |       |  | 10.6x |  |  |  | 6.5x | 
|Median |  |             | 0.8x |  |            |  | 1.2x |       |  |  | 0.9x |  |  |     | 7.8x  |  |       |  | 7.2x  |  |  |  | 6.4x | 
|Mean   |  |             | 1.1x |  |            |  | 1.4x |       |  |  | 0.9x |  |  |     | 8.4x  |  |       |  | 8.3x  |  |  |  | 6.4x | 












Comparable Transaction Methodology.








|                     |  |          |                          | 
|-------------------- |  | -------- | ------------------------ | 
|Target               |  | Acquiror |                         
|                     |  |          |                         
|Reeds Jewelers, Inc. |  |          | Zimmer Family            | 
|Harry Winston        |  |          | Aber Diamond Corp.       | 
|Piercing Pagoda      |  |          | Zale Corporation         | 
|Marks & Morgan       |  |          | Signet Group PLC         | 
|Watch World Intl    |  |          | Sunglass Hut Intl       | 
|Jay B. Rudolph, Inc. |  |          | Finlay Enterprises, Inc. | 















|       |  |                 |       |     |         |  |      |        |  |  |      |    
|------ |  | --------------- | ----- | --- | ------- |  | ---- | ------ |  |  | ---- | ---
|       |  |                 |       | EV/ |        
|       |  |                 |       |     |        
|       |  | EV              |       |     | Revenue |  |      | EBITDA | 
|       |  |                 |       |     |         |  |      |        | 
|       |  | ($ in millions) |       |     |         |  |     
|Low    |  | $               | 20.6  |     |         |  | 0.2x |        |  |  | NMF  |    
|High   |  | $               | 247.4 |     |         |  | 1.3x |        |  |  | NMF  |    
|      
|Median |  |                 |       |     |         |  | 0.8x |        |  |  | 7.1x | (1)
|Mean   |  |                 |       |     |         |  | 0.8x |        |  |  | 7.1x | (1)












|    |                           
|--- | --------------------------
|(1) | Based on single data point












49



---



##### Table of Contents






Discounted Cash Flow Methodology.





Determination of Mayors Equity Value.





|                                |  |                  |        |  |      |   |         | 
|------------------------------- |  | ---------------- | ------ |  | ---- | - | ------- | 
|                                |  | Low              |        |  | High |  
|                                |  |                  |        |  |      |  
|                                |  | ($ In thousands) |       
|Market Multiple Approach        |  | $                | 92,000 |  |      | $ | 101,000 | 
|Discounted Cash Flow  Method 1 |  | $                | 91,000 |  |      | $ | 103,000 | 
|Discounted Cash Flow  Method 2 |  | $                | 91,000 |  |      | $ | 107,000 | 














Determination of Birks Equity Value.





|                                |  |                  |        |  |      |   |        | 
|------------------------------- |  | ---------------- | ------ |  | ---- | - | ------ | 
|                                |  | Low              |        |  | High |  
|                                |  |                  |        |  |      |  
|                                |  | ($ In thousands) |       
|Market Multiple Approach        |  | $                | 76,000 |  |      | $ | 84,000 | 
|Discounted Cash Flow  Method 1 |  | $                | 75,000 |  |      | $ | 86,000 | 
|Discounted Cash Flow  Method 2 |  | $                | 71,000 |  |      | $ | 82,000 | 






50



---



##### Table of Contents














Analysis of Exchange Ratio.



















51



---



##### Table of Contents









Financial Projections Provided to Houlihan Lokey








| |                        
| | -----------------------
| | Birks excluding Mayors

|             |  |                        |         |  |      |   |         | 
|------------ |  | ---------------------- | ------- |  | ---- | - | ------- | 
|             |  | Projected Fiscal Year  |        
|             |  | Ending March,          |        
|             |  |                        |        
|             |  | 2006                   |         |  | 2007 |  
|             |  |                        |         |  |      |  
|             |  | ($ In thousands)(1)(2) |        
|Net Sales    |  | $                      | 120,827 |  |      | $ | 130,066 | 
|Gross Profit |  | $                      | 61,072  |  |      | $ | 65,955  | 
|EBITDA       |  | $                      | 9,438   |  |      | $ | 13,166  | 
|Net Income   |  | $                      | 2,462   |  |      | $ | 5,496   | 






|    |                                                                          
|--- | -------------------------------------------------------------------------
|(1) | Assumes a fixed foreign currency exchange rate of
    Cdn$1.00 per $0.82.
|   
|(2) | Prepared in accordance with Canadian GAAP.                               

52



---



##### Table of Contents





| |        
| | -------
| | Mayors

|             |  |                       |         |  |      |   |         | 
|------------ |  | --------------------- | ------- |  | ---- | - | ------- | 
|             |  | Projected Fiscal Year |        
|             |  | Ending March,         |        
|             |  |                       |        
|             |  | 2006                  |         |  | 2007 |  
|             |  |                       |         |  |      |  
|             |  | ($ In thousands)      |        
|Net Sales    |  | $                     | 156,800 |  |      | $ | 172,057 | 
|Gross Profit |  | $                     | 69,831  |  |      | $ | 78,046  | 
|EBITDA       |  | $                     | 10,032  |  |      | $ | 15,430  | 
|Net Income   |  | $                     | 1,651   |  |      | $ | 7,544   | 

















53



---



##### Table of Contents






Birks Reasons for the Merger and Negative Factors
Considered















| |   |                                                                              
| | - | -----------------------------------------------------------------------------
| |  | create a larger public company; and                                          
|
| |  | eliminate inefficiencies resulting from operating two separate
    companies.













Interests of Mayors Executive Officers and Directors in
the Merger


Mayors Executive Officers and Directors.


















54



---



##### Table of Contents





Representation on Birks Board of Directors.


Officers of Birks.


Representation on Mayors Board of Directors.


Officers of Mayors.





Birks Directors and Executive Officers.





Treatment of Stock Options, Warrants and Other Stock
Awards.


Indemnification and Insurance.


55



---



##### Table of Contents






MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE
MERGER














| |   |                                                                                                                                                                                                                                                                                                                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | banks, insurance companies, trustees and mutual funds;                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | tax-exempt organizations;                                                                                                                                                                                                                                                                                                                                                                                                
|
| |  | financial institutions;                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | pass-through entities and investors in pass-through entities;                                                                                                                                                                                                                                                                                                                                                            
|
| |  | traders in securities who elect to apply a mark-to-market method
    of accounting;                                                                                                                                                                                                                                                                                                                                      
|
| |  | broker-dealers;                                                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | holders who are not U.S. Holders (as defined below);                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | holders who received Mayors common stock pursuant to the
    exercise of employee stock options or otherwise as compensation;                                                                                                                                                                                                                                                                                           
|
| |  | holders who hold Mayors common stock as part of a hedging,
    integration, conversion or constructive sale transaction or a
    straddle;                                                                                                                                                                                                                                                                              
|
| |  | persons whose functional currency is not the
    U.S. dollar;                                                                                                                                                                                                                                                                                                                                                          
|
| |  | holders who are subject to the alternative minimum tax;                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | holders of Mayors common stock who will own 5% or more of
    either the total voting power or the total value of the
    outstanding stock of Birks after the merger, determined after
    taking into account ownership under the applicable attribution
    rules of the Code and Treasury regulations (these holders are
    referred to in this proxy statement/ prospectus as 5% transferee
    shareholders); and
|
| |  | holders who own, as a result of the merger or otherwise
    (directly, indirectly or constructively), 10% or more of the
    total combined voting power of Birks Class A voting shares.                                                                                                                                                                                                                                 

Holders should consult their own tax advisors concerning the
U.S. federal income tax consequences of the merger and the
ownership of Birks Class A voting shares in light of their
particular situations, as well as any consequences arising under
the laws of any other taxing jurisdiction.


56



---



##### Table of Contents









| |                           
| | --------------------------
| | Consequences of the Merger













| |   |                                                                                                                                                                                                                                                                                                                                                                                                                             
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | no gain or loss will be recognized by a holder of Mayors
    common stock as a result of the merger, except to the extent of
    any cash received in lieu of a fractional share of Birks, and
    provided that, in the case of any 5% transferee shareholder, the
    5% transferee shareholder enters into a gain recognition
    agreement in accordance with applicable Treasury
    regulations;                   
|
| |  | the aggregate adjusted tax basis of a Mayors stockholder
    in the Birks Class A voting shares issued upon conversion
    of Mayors common stock pursuant to the merger (including
    any fractional share interest deemed to be received and
    converted into cash, as discussed below) will equal that
    stockholders aggregate adjusted tax basis in Mayors
    common stock surrendered in the conversion; and
|
| |  | the holding period of a Mayors stockholder for the Birks
    Class A voting shares received in the merger will include
    the holding period for Mayors common stock surrendered in
    the conversion into Birks Class A voting shares in the
    merger.                                                                                                                                                               







| |                                  
| | ---------------------------------
| | Cash in Lieu of Fractional Shares



57



---



##### Table of Contents







| |                                             
| | --------------------------------------------
| | Backup Withholding and Information Reporting





| |   |                                                                                                                                                                                                                                                                               
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | furnish a correct taxpayer identification number and certify
    that they are not subject to backup withholding on the
    Form W-9 or successor form included in the letter of
    transmittal to be delivered to the holders following the
    completion of the merger; or
|
| |  | are otherwise exempt from backup withholding.                                                                                                                                                                                                                                 





Material U.S. Federal Income Tax Consequences of Owning
and Disposing of Birks Class A Voting Shares




| |                            
| | ---------------------------
| | Dividends and Distributions







58



---



##### Table of Contents









| |                                          
| | -----------------------------------------
| | Sale or Exchange of Class A Voting Shares





| |                                   
| | ----------------------------------
| | Passive Foreign Investment Company



59



---



##### Table of Contents









| |                                             
| | --------------------------------------------
| | Backup Withholding and Information Reporting






MATERIAL CANADIAN FEDERAL INCOME TAX CONSEQUENCES OF THE
MERGER










| |                                   
| | ----------------------------------
| | Conversion of Mayors Common Stock



60



---



##### Table of Contents





| |                                         
| | ----------------------------------------
| | Dividends on Birks Class A Voting Shares





| |                                           
| | ------------------------------------------
| | Disposition of Birks Class A Voting Shares








MERGER FEES, COSTS AND EXPENSES







NO DISSENTERS RIGHTS OF APPRAISAL




61



---



##### Table of Contents








STOCK EXCHANGE LISTING







RESALE OF BIRKS CLASS A VOTING SHARES


U.S. Resale Requirements.


Canadian Resale Requirements.


62



---



##### Table of Contents






THE MERGER AGREEMENT


The following is a summary of selected provisions of the
merger agreement. While Mayors and Birks believe this
description covers the material terms of the merger agreement,
it may not contain all the information that is important to you,
and it is qualified in its entirety by reference to the merger
agreement, which is incorporated by reference in its entirety
and attached to this proxy statement/ prospectus as
Appendix A. We urge you to read the merger agreement in its
entirety. In the event of any discrepancy between the terms of
the merger agreement and the following summary, the merger
agreement will control.


Structure of the Merger




Effective Time of the Merger










Closing




Surviving Corporation Governing Documents, Officers and
Directors


Surviving Corporation Governing Documents.


Surviving Corporation Officers and Directors.


Merger Consideration


Conversion of Mayors Common Stock.


Cancellation of Treasury Stock.


Conversion of Merger Co. Stock.


63



---



##### Table of Contents



Fractional Birks Class A Voting Shares.


Options, Warrants and Other Stock Awards.


Lost, Stolen or Destroyed Certificates.


Certain Adjustments.


Representations and Warranties






| |   |                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | corporate authorization and validity of the merger agreement and
    the inapplicability of anti-takeover statutes to the merger;                                                                                                                                                                                                                                                                      
|
| |  | the absence of any conflict of the merger agreement with
    Mayors certificate of incorporation or by-laws, with
    applicable laws or with any agreement to which Mayors or
    any of its subsidiaries is a party and, subject to certain
    exceptions set forth in the merger agreement, the absence of
    governmental consents, filings and approvals necessary to
    complete the merger;
|
| |  | the approval by the special committee and Mayors board of
    directors of the merger agreement and the transactions
    contemplated by the merger agreement, the recommendation of the
    merger agreement by the special committee and Mayors board
    of directors to Mayors stockholders and the required vote
    by the stockholders of Mayors to complete the merger;                    
|
| |  | the receipt of the opinion of the financial advisor to the
    special committee as to the fairness, from a financial point of
    view, of the merger consideration to Mayors common
    stockholders; and                                                                                                                                                                                           
|
| |  | brokers and finders fees related to the merger.                                                                                                                                                                                                                                                                                                                                                      

64



---



##### Table of Contents







| |   |                                                                                                                                                                                                                                                                                                                                                                                                   
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | amalgamation or incorporation, valid existence and qualification
    to do business of Birks and each of its subsidiaries, and
    Birks interests in its subsidiaries and certain
    partnerships and limited liability companies;                                                                                                                                                             
|
| |  | the amended charter and amended by-laws, or other organizational
    documents, of Birks being amended as specified in the merger
    agreement, being in full force and effect and Birks not being in
    conflict with such organizational documents;                                                                                                                                           
|
| |  | Birks capitalization;                                                                                                                                                                                                                                                                                                                                                                            
|
| |  | corporate authorization and validity of the merger agreement;                                                                                                                                                                                                                                                                                                                                     
|
| |  | the absence of any conflict of the merger agreement with
    Birks amended charter or Birks amended by-laws, with
    applicable laws or with any agreement to which Birks or any of
    its subsidiaries is a party and, subject to certain exceptions
    set forth in the merger agreement, the absence of governmental
    consents, filings and approvals necessary to complete the merger;
|
| |  | Birks possession of all permits and regulatory approvals
    required to conduct its business, and compliance by Birks and
    its subsidiaries with all applicable foreign, federal, state and
    local laws;                                                                                                                                                                                  
|
| |  | the proper filing of documents with the SEC;                                                                                                                                                                                                                                                                                                                                                      
|
| |  | the accuracy of financial statements and absence of undisclosed
    liabilities;                                                                                                                                                                                                                                                                                                                  
|
| |  | the absence of material changes or events in the business of
    Birks;                                                                                                                                                                                                                                                                                                                           
|
| |  | the adequacy of internal control over financial reporting and
    the absence of any complaint or allegation with respect to
    questionable accounting or auditing practices;                                                                                                                                                                                                                   
|
| |  | the absence of material pending or threatened litigation
    outstanding against Birks or any of its subsidiaries;                                                                                                                                                                                                                                                                                
|
| |  | employee benefit plans;                                                                                                                                                                                                                                                                                                                                                                           
|
| |  | labor and employment matters;                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | title to real property, whether leased or owned;                                                                                                                                                                                                                                                                                                                                                  
|
| |  | ownership and validity of intellectual property rights;                                                                                                                                                                                                                                                                                                                                           
|
| |  | tax matters and the payment of taxes;                                                                                                                                                                                                                                                                                                                                                             
|
| |  | various environmental matters, including compliance with
    environmental laws;                                                                                                                                                                                                                                                                                                                  
|
| |  | validity and effect of, and absence of defaults under, material
    contracts;                                                                                                                                                                                                                                                                                                                    
|
| |  | adequacy of insurance;                                                                                                                                                                                                                                                                                                                                                                            
|
| |  | customers and suppliers;                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | the absence of certain unlawful business practices;                                                                                                                                                                                                                                                                                                                                               
|
| |  | interested party transactions;                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | a vote of Birks shareholders not being required to
    consummate the merger;                                                                                                                                                                                                                                                                                                                    
|
| |  | accounts receivables;                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | inventories;                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | Merger Co.s operations; and                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | brokers and finders fees related to the merger.                                                                                                                                                                                                                                                                                                                                                 

65



---



##### Table of Contents







| |   |                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------
| |  | general economic conditions or securities markets in general
    that do not have a disproportionate effect on Mayors or
    Birks, as applicable;
|
| |  | the industry in which Birks and Mayors operate that does
    not have a disproportionate effect on Mayors or Birks, as
    applicable; or        
|
| |  | the public announcement of the merger agreement or the
    consummation of the transactions contemplated by the merger
    agreement.              

Conduct of Business Pending the Merger


Conduct of Mayors Business Pending Merger.


Conduct of Birks Business Pending Merger.




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | operate other than in the ordinary course of business and
    consistent with past practice or in a way that would cause it to
    be in default under its credit agreement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | change or amend its charter or by-laws;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | issue, sell, or grant any shares of capital stock, or any
    options, warrants or rights to purchase or subscribe to, or
    enter into any arrangement with respect to the issuance or sale
    of any capital stock of Birks or any rights or obligations
    convertible into or exchangeable for any such shares;                                                                                                                                                                                                                                                                                                                        
|
| |  | split, combine or reclassify any of its capital stock or
    otherwise make any changes to its capital structure;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | declare, pay, or set aside for payment any dividend or other
    distribution in respect of the capital stock or other equity
    securities of Birks or any of its subsidiaries or redeem,
    purchase, or otherwise acquire any shares of the capital stock
    or other securities of Birks or any of its subsidiaries or
    rights or obligations convertible into or exchangeable for any
    shares of the capital stock or other securities of Birks or any
    of its subsidiaries or obligations convertible into such, or any
    options, warrants, or other rights to purchase or subscribe to
    any of the foregoing;        
|
| |  | increase the wages, salaries compensation, or other benefits
    payable to any officer, employee or director of Birks, pay any
    pension or retirement allowance not required by existing
    agreement or applicable law, pay any bonus not consistent with
    past practice or required by an existing agreement or applicable
    law, become a party to or amend or commit itself to any other
    benefit agreement not required by existing agreement or
    applicable law, or accelerate the vesting of any stock options
    previously granted, other than in the ordinary course of
    business consistent with past practice;
|
| |  | sell, license, lease, encumber, assign, or otherwise dispose of,
    abandon, or fail to maintain any material assets or rights or
    agreements other than in the ordinary course of business
    consistent with past practice;                                                                                                                                                                                                                                                                                                                                                                                                            
|
| |  | enter into any new line of business;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

66



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | acquire or agree to acquire a substantial equity interest in or
    a substantial portion of the assets of any business or any
    division thereof;                                                                                                                                                                                                                                                                                 
|
| |  | create, renew, amend, terminate, or fail to perform any material
    obligations under or waive or release any material rights under
    or give notice of a proposed renewal, amendment, waiver, release
    or termination of, any material contract, agreement, or lease
    for goods, services or office space to which Birks is a party
    other than in the ordinary course of business and with prior
    notice to Mayors;
|
| |  | cause any material insurance policy naming Birks as a
    beneficiary or loss payable payee to be cancelled or terminated,
    or cause Birks directors and officers liability insurance
    policy to be cancelled, terminated, or otherwise not renewed or
    replaced without an equivalent amount of coverage on no less
    favorable terms to Birks;                                                                         
|
| |  | adopt a plan of complete or partial liquidation, dissolution,
    merger, consolidation, restructuring, recapitalization or other
    reorganization of Birks or any of its subsidiaries;                                                                                                                                                                                                                                            
|
| |  | make any material election relating to taxes or change any tax
    accounting method, or settle any liability relating to taxes
    other than in the ordinary course of business consistent with
    past practice;                                                                                                                                                                                                                 
|
| |  | engage in any action that could be expected to cause the merger
    to fail to qualify as a reorganization under
    section 368(a) of the Code or result in the application of
    Section 367(a)(1) of the Code to any person other than a 5%
    transferee shareholder;                                                                                                                                                        
|
| |  | take any action to cause Birks representations and
    warranties to be untrue in any material respect                                                                                                                                                                                                                                                                                                                              
|
| |  | take any action that would reasonably be likely to materially
    delay the merger; or                                                                                                                                                                                                                                                                                                                                               
|
| |  | agree to take, make any commitment to take, or adopt any
    resolutions of its board of directors in support of, any of the
    foregoing actions.                                                                                                                                                                                                                                                                                  

Additional Agreements


Registration Statement; Proxy Statement.






Stockholder Meeting.


67



---



##### Table of Contents



Access to Information and Confidentiality.


Indemnification and Directors and Officers
Insurance.


Notification.


Mayors Affiliates.


Further Action; Reasonable Efforts.


Plan of Reorganization.


Obligations of Merger Co.


Consents of Accountants.


AMEX Listing.


Public Announcements.


Birks Board of Directors.


Mayors Stock Held by Birks.


Conditions to the Merger




68



---



##### Table of Contents



Conditions to Each Partys Obligation to Effect the
Merger.




| |   |                                                                                                                                                                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the registration statement of which this proxy statement/
    prospectus is a part having been declared effective under the
    Securities Act of 1933, and no stop order or proceeding seeking
    a stop order being pending by or before the SEC;
|
| |  | Mayors disinterested stockholders having affirmatively
    voted to approve and adopt the merger agreement by the requisite
    vote;                                                                                                              
|
| |  | no injunction, order or other legal restraint or prohibition
    preventing the consummation of the merger being in effect;                                                                                                                         
|
| |  | Birks Class A voting shares having been authorized for
    listing on the American Stock Exchange; and                                                                                                                                              
|
| |  | the fairness opinion obtained from Houlihan Lokey having not
    been withdrawn, revoked, annulled or materially modified.                                                                                                                          

Conditions to Obligations of Birks and Merger Co.




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the representations and warranties of Mayors being true
    and correct in all material respect as of the effective time of
    the merger as if made at the effective time of the merger
    (except that any representation or warranty that is qualified by
    materiality will be read without such materiality
    qualifications) and Birks having received a certificate from
    Mayors to this effect;
|
| |  | Mayors having performed in all material respects all of
    its obligations under the merger agreement, and Birks having
    received a certificate from Mayors to this effect;                                                                                                                                                                                                                                 
|
| |  | all consents, approvals and authorizations legally required to
    be obtained to consummate the merger from all Governmental
    Authorities, and all consents from specified third parties,
    having been obtained;                                                                                                                                                                                           
|
| |  | Mayors not being subject to a material adverse effect as
    defined in the merger agreement; and                                                                                                                                                                                                                                                                                                                
|
| |  | additional warrants to purchase Mayors common stock having
    been issued to Joseph A. Keifer, Marco Pasteris and Carlo
    Coda-Nunziante.                                                                                                                                                                                                                                                                     

Conditions to Obligations of Mayors.




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the representations and warranties of Birks being true and
    correct in all material respect as of the effective time of the
    merger as if made at the effective time of the merger (except
    that any representation or warranty that is qualified by
    materiality will be read without such materiality
    qualifications) and Mayors having received a certificate
    from Birks to this effect;                                                                                                                                                                                                                                                                                                                                              
|
| |  | Birks having performed in all material respects all of its
    obligations under the merger agreement, and Mayors having
    received a certificate from Mayors to this effect;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
|
| |  | Mayors having received an opinion of Holland &
    Knight LLP, Mayors legal counsel, or King &
    Spalding LLP, legal counsel to the special committee, stating
    that (i) the merger will qualify as a reorganization within
    the meaning of Section 368(a) of the Code and each of Birks
    and Mayors will be a party to the reorganization, and
    (ii) the conversion of Mayors common stock into Birks
    Class A voting shares in the merger will not result in the
    recognition of gain under Section 367 of the Code (except,
    under certain circumstances, in the case of a person who owns,
    actually or constructively, 5% or more of the voting power or
    value of the outstanding stock of Birks following the merger);
|
|
| |  | Mayors having obtained the affirmative vote of the
    required majority of Mayors voting stock in favor of the
    merger at Mayors stockholders meeting;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

69



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                              
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Birks Articles of Amalgamation and Birks By-laws
    being amended as specified in the merger agreement;                                                                                                                                                                   
|
| |  | Birks not being subject to a material adverse effect as defined
    in the merger agreement;                                                                                                                                                                                 
|
| |  | all consents, approvals and authorizations legally required to
    be obtained to consummate the merger from all Governmental
    Authorities, and all consents from specified third parties,
    having been obtained;                                                      
|
| |  | all of the issued and outstanding Series A preferred shares
    of Birks and $5,000,000 aggregate principal amount of secured
    convertible notes of Birks having been converted into Birks
    Class A voting shares and Birks Class B multiple
    voting shares;        
|
| |  | warrants to purchase Mayors common stock having been
    amended to eliminate the application of anti-dilution
    provisions; and                                                                                                                                          
|
| |  | the employment agreement or other documents between Birks and
    Thomas A. Andruskevich having been amended to eliminate the
    application of certain anti-dilution provisions to the future
    issuance of stock based compensation after the merger is
    consummated.









Termination, Amendment and Waiver


Termination.




| |   |                                                   
| | - | --------------------------------------------------
| |  | by mutual written consent of Birks and Mayors; or
|
| |  | by either Birks or Mayors if:                    



| |   |                                                                                                                                                                                                                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the merger is not effective by December 31, 2005; provided
    that the right to terminate will not be available to any party
    whose failure to fulfill any obligation under the merger
    agreement has been the cause of, or resulted in, the failure of
    the merger to be completed by such date;                                        
|
| |  | a governmental entity of competent jurisdiction has issued an
    order or injunction or has issued any other restraint or
    prohibition preventing consummation of the merger;                                                                                                                                                                  
|
| |  | Mayors stockholders fail to approve and adopt the merger
    agreement at the special and annual meeting (or any adjournment
    or postponement of the special and annual meeting);                                                                                                                                                              
|
| |  | the other party breaches any representation, warranty, covenant
    or agreement such that the terminating partys closing
    conditions are not satisfied and the breach is either not
    reasonably capable of being cured or has not been cured prior to
    15 days after notice of the breach; or                                           
|
| |  | the special committee or Mayors board of directors fails
    to recommend or withdraws, modifies or qualifies in any manner
    adverse to Birks its recommendation of the approval and adoption
    of the merger agreement, or the fairness opinion obtained from
    Houlihan Lokey is withdrawn, revoked, annulled or materially
    modified.



Effect of Termination.


70



---



##### Table of Contents



Fees and Expenses.


Amendment.


Waiver.


General Provisions


Non-Survival of Representations and Warranties.


Governing Law.


71



---



##### Table of Contents






COMPARISON OF STOCKHOLDER RIGHTS






| |   |                                                                                                                                                              
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the laws of Delaware, particularly the Delaware General
    Corporation Law, referred to in this proxy statement/ prospectus
    as the DGCL;                
|
| |  | Mayors Certificate of Incorporation, referred to in this
    proxy statement/ prospectus as Mayors charter or
    Mayors certificate of incorporation; and
|
| |  | Mayors By-laws, referred to in this proxy statement/
    prospectus as Mayors by-laws.                                                                     





| |   |                                                                                                                                         
| | - | ----------------------------------------------------------------------------------------------------------------------------------------
| |  | the Canada Business Corporations Act, referred to in this proxy
    statement/ prospectus as the CBCA;                                  
|
| |  | Birks amended Articles of Amalgamation, which is referred
    to in this proxy statement/ prospectus as Birks amended
    charter; and
|
| |  | Birks amended By-laws, which are referred to in this proxy
    statement/ prospectus as Birks amended by-laws.                        





Classes and Series of Capital Stock




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



Annual Meetings of Stockholders




| |        
| | -------
| | Mayors



72



---



##### Table of Contents







| |      
| | -----
| | Birks



Special Meetings of Stockholders




| |        
| | -------
| | Mayors





| |   |                                                                                         
| | - | ----------------------------------------------------------------------------------------
| |  | the president; or                                                                       
|
| |  | the board of directors pursuant to a resolution approved by a
    majority of the board.



| |      
| | -----
| | Birks



73



---



##### Table of Contents



Quorum of Stockholders




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



Stockholder Action Without a Meeting




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



Stockholder Nominations and Proposals




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



74



---



##### Table of Contents





Access to Corporate Records, Financial Statements and Related
Matters




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



Charter Amendments




| |        
| | -------
| | Mayors





| |   |                                                                                                                                                                                                                                                                                            
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the amendment of the by-laws;                                                                                                                                                                                                                                                              
|
| |  | the prohibition of stockholder action by written consent;                                                                                                                                                                                                                                  
|
| |  | the board of directors and management of Mayors; and                                                                                                                                                                                                                                      
|
| |  | business combinations (except that to amend the business
    combination provision of the charter, the affirmative vote of
    holders of not less than two-thirds of the outstanding
    Mayors stock entitled to vote that are not related to the
    business combination is required).



| |      
| | -----
| | Birks



75



---



##### Table of Contents





By-Law Amendments




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks





Vote on Sale or Lease of Assets




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



76



---



##### Table of Contents





Vote on Extraordinary Corporate Actions




| |        
| | -------
| | Mayors





| |   |                                                                                                                                                         
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the merger will not result in the issuance of shares
    representing more than 20% of its common stock outstanding
    immediately prior to the merger;
|
| |  | each share of its stock outstanding prior to the merger will be
    an identical share of stock following the merger; and                               
|
| |  | the merger agreement does not amend in any respect its
    certificate of incorporation.                                                                







| |      
| | -----
| | Birks





77



---



##### Table of Contents



Preemptive Rights




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



Dividends




| |        
| | -------
| | Mayors





| |   |                                                                                                                                                                                                                                               
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | out of surplus; or                                                                                                                                                                                                                          
|
| |  | if there is no surplus, out of the net profits for the fiscal
    year in which the dividend is declared and/or the preceding
    fiscal year, unless net assets are less than the capital
    represented by all outstanding preferred stock.





| |      
| | -----
| | Birks



Appraisal and Dissent Rights




| |        
| | -------
| | Mayors





| |   |                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------
| |  | listed on a national securities exchange or designated as a
    Nasdaq National Market security; or
|
| |  | held of record by more than 2,000 stockholders.                                                    

78



---



##### Table of Contents







| |   |                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | stock of the surviving corporation;                                                                                                                                                                    
|
| |  | stock of another corporation which is either listed on a
    national securities exchange or designated as a Nasdaq National
    Market security or held of record by more than 2,000
    stockholders;
|
| |  | cash in lieu of fractional shares; or                                                                                                                                                                  
|
| |  | some combination of the above.                                                                                                                                                                         





| |      
| | -----
| | Birks





| |   |                                                                                                                                                                                                                                                                                                                                                      
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | any amalgamation with another corporation (other than with
    certain affiliated corporations);                                                                                                                                                                                                                                                     
|
| |  | an amendment to a corporations charter to add, change or
    remove any provisions restricting the issue transfer or
    ownership of shares;                                                                                                                                                                                                       
|
| |  | an amendment to a corporations charter to add, change or
    remove any restriction upon the business or businesses that such
    corporation may carry on;                                                                                                                                                                                         
|
| |  | a continuance under the laws of another jurisdiction;                                                                                                                                                                                                                                                                                                
|
| |  | a sale, lease or exchange of all or substantially all the
    property of a corporation other than in the ordinary course of
    business;                                                                                                                                                                                                           
|
| |  | a going-private transaction or a squeeze-out transaction;                                                                                                                                                                                                                                                                                            
|
| |  | a court order permitting a shareholder to dissent in connection
    with an application to the court for an order approving an
    arrangement proposed by a corporation; or                                                                                                                                                                         
|
| |  | certain amendments to a corporations charter that require
    a separate class or series vote, provided that a shareholder is
    not entitled to dissent if an amendment to a companys
    charter is effected by a court order approving a reorganization
    or by a court order made in connection with an action for an
    oppression remedy.



Stock Repurchases




| |        
| | -------
| | Mayors



79



---



##### Table of Contents





| |      
| | -----
| | Birks



Number and Qualification of Directors




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks





Filling Vacancies on the Board of Directors




| |        
| | -------
| | Mayors



80



---



##### Table of Contents





| |      
| | -----
| | Birks



Removal of Directors




| |        
| | -------
| | Mayors







| |      
| | -----
| | Birks



Transactions with Directors and Officers




| |        
| | -------
| | Mayors





| |   |                                                                                                                                                                                                                                                                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the material facts regarding the directors or
    officers relationship or interest with respect to the
    contract or transaction are disclosed to or known by the board
    of directors and a majority of the disinterested directors
    authorize the contract or transaction in good faith, even though
    the disinterested directors are less than a quorum;
|
| |  | the material facts regarding the directors or
    officers relationship or interest and the contract or
    transaction are disclosed to or known by the stockholders
    entitled to vote on the contract or transaction and the contract
    or transaction is specifically approved in good faith by the
    stockholders; or                                      
|
| |  | the contract or transaction is fair to the corporation as of the
    time it is authorized, approved or ratified by the board of
    directors or the stockholders.                                                                                                                                                                                                     



| |      
| | -----
| | Birks



81



---



##### Table of Contents







| |   |                                                                                         
| | - | ----------------------------------------------------------------------------------------
| |  | the director or officer disclosed his interest;                                         
|
| |  | the contract was approved by the directors; and                                         
|
| |  | the contract was reasonable and fair to Birks at the time the
    contract was approved.



Director and Officer Liability and Indemnification




| |        
| | -------
| | Mayors





| |   |                                                                                                          
| | - | ---------------------------------------------------------------------------------------------------------
| |  | breaches of duty of loyalty;                                                                             
|
| |  | acts or omissions not in good faith or involving intentional
    misconduct or knowing violations of law;
|
| |  | the payment of unlawful dividends, stock repurchases or
    redemptions; or                              
|
| |  | any transaction in which the director received an improper
    personal benefit.                         







82



---



##### Table of Contents







| |      
| | -----
| | Birks





| |                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) that person acted honestly and in good faith with a
    view to the best interests of the corporation; and                                                                                               
|
| | (2) in the case of a criminal or administrative action or
    proceeding that is enforced by a monetary penalty, that person
    had reasonable grounds for believing that his or her conduct was
    lawful.







Fiduciary Duties of Directors




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



83



---



##### Table of Contents



Derivative Action




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks





| |   |                                                                                                                                                                                                                                                                                                
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the complainant has given reasonable notice to the directors of
    the corporation or its subsidiary of the persons intention
    to apply to the court if the directors of the corporation or its
    subsidiary do not bring, diligently prosecute or defend or
    discontinue the action;
|
| |  | the person is acting in good faith; and                                                                                                                                                                                                                                                        
|
| |  | it appears to be in the interests of the corporation or its
    subsidiary that the action be brought, prosecuted, defended or
    discontinued.                                                                                                                                               



Oppression Remedy




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks





| |                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------
| | (1) any act or omission of a corporation or an affiliate
    effects a result;                                               
|
| | (2) the business or affairs of a corporation or an
    affiliate are or have been carried on or conducted in a
    manner; or
|
| | (3) the powers of the directors of a corporation or an
    affiliate are or have been exercised in a manner;                 



84



---



##### Table of Contents







| |                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------
| | (1) a present or former registered holder or beneficial
    owner of securities of a corporation or any of its affiliates;
|
| | (2) a present or former officer or director of a
    corporation or any of its affiliates;                                
|
| | (3) a director under the CBCA; and                                                                                        
|
| | (4) any other person who in the discretion of the court is
    a proper person to make such application.                  






Class Actions










| |        
| | -------
| | Mayors

















| |      
| | -----
| | Birks












Anti-Takeover and Ownership Provisions




| |        
| | -------
| | Mayors









| |      
| | -----
| | Birks



85



---



##### Table of Contents





Voluntary Dissolution




| |        
| | -------
| | Mayors





| |      
| | -----
| | Birks



Foreign Private Issuer Status




86



---



##### Table of Contents






SELECTED HISTORICAL FINANCIAL DATA OF BIRKS










|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |        |   |  |   |        |  
|--------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------- | ------- | - | ---------- | - | ------- | ---------- |  | - | ---------- | - |  | ---------- | ------ | - |  | - | ------ | -
|                                                                                                                                  |  | Year Ended                                              |         |   | Year Ended |   |         | Year Ended |  |   | Year Ended |   |  | Year Ended |       
|                                                                                                                                  |  | March 26,                                               |         |   | March 27,  |   |         | March 29,  |  |   | March 30,  |   |  | March 31,  |       
|Income Statement Data                                                                                                             |  | 2005                                                    |         |   | 2004       |   |         | 2003       |  |   | 2002       |   |  | 2001       |       
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       
|                                                                                                                                  |  | (Amounts in thousands of dollars except per share data) |        
|Net sales                                                                                                                         |  | $                                                       | 239,301 |   |            | $ | 216,256 |            |  | $ | 151,312    |   |  | $          | 75,848 |   |  | $ | 81,123 |  
|Cost of sales                                                                                                                     |  |                                                         | 130,037 |   |            |   | 118,861 |            |  |   | 83,698     |   |  |            | 36,810 |   |  |   | 40,251 |  
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       
|Gross profit                                                                                                                      |  |                                                         | 109,264 |   |            |   | 97,395  |            |  |   | 67,614     |   |  |            | 39,038 |   |  |   | 40,872 |  
|Selling, general and administrative expenses (including non-cash
    compensation expense)                                        |  |                                                         | 95,764  |   |            |   | 93,638  |            |  |   | 63,890     |   |  |            | 34,787 |   |  |   | 35,298 |  
|Depreciation and amortization                                                                                                     |  |                                                         | 4,749   |   |            |   | 4,312   |            |  |   | 3,256      |   |  |            | 2,894  |   |  |   | 2,844  |  
|Other items                                                                                                                       |  |                                                         | (1,181  | ) |            |   | 338     |            |  |   | (210       | ) |  |            |       |   |  |   | (4     | )
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       
|Total operating expenses                                                                                                          |  |                                                         | 99,332  |   |            |   | 98,288  |            |  |   | 66,936     |   |  |            | 37,681 |   |  |   | 38,138 |  
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       
|Operating income (loss)                                                                                                           |  |                                                         | 9,932   |   |            |   | (893    | )          |  |   | 678        |   |  |            | 1,357  |   |  |   | 2,734  |  
|Interest on long-term debt                                                                                                        |  |                                                         | 2,906   |   |            |   | 2,858   |            |  |   | 2,448      |   |  |            | 1,475  |   |  |   | 1,287  |  
|Interest and other financial costs                                                                                                |  |                                                         | 5,759   |   |            |   | 5,312   |            |  |   | 3,486      |   |  |            | 2,307  |   |  |   | 2,750  |  
|(Gain) loss on sale of Mayors common shares                                                                                      |  |                                                         | (232    | ) |            |   | 176     |            |  |   |           |   |  |            |       |   |  |   |       |  
|Loss on disposal of Mayors warrants                                                                                              |  |                                                         | 332     |   |            |   | 334     |            |  |   | 312        |   |  |            |       |   |  |   |       |  
|Interest and other income                                                                                                         |  |                                                         |        |   |            |   | (184    | )          |  |   | (389       | ) |  |            |       |   |  |   |       |  
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       
|Income (loss) from continuing operations before income tax,
    minority interest, discontinued operations and extraordinary item |  |                                                         | 1,167   |   |            |   | (9,389  | )          |  |   | (5,179     | ) |  |            | (2,425 | ) |  |   | (1,303 | )
|Income tax benefit                                                                                                                |  |                                                         |        |   |            |   |        |            |  |   | 991        |   |  |            |       |   |  |   |       |  
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       
|Income (loss) from continuing operations before minority
    interest, discontinued operations and extraordinary item             |  |                                                         | 1,167   |   |            |   | (9,389  | )          |  |   | (4,188     | ) |  |            | (2,425 | ) |  |   | (1,303 | )
|Minority interest in loss of subsidiary(1)                                                                                        |  |                                                         |        |   |            |   | 7,175   |            |  |   | 8,071      |   |  |            |       |   |  |   |       |  
|                                                                                                                                  |  |                                                         |         |   |            |   |         |            |  |   |            |   |  |            |       

87



---



##### Table of Contents



|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |           |   |  |   |           |  
|-------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------- | --------- |  | ---------- | - | --------- | ---------- |  | - | ---------- | - |  | ---------- | --------- | - |  | - | --------- | -
|                                                                                                   |  | Year Ended                                              |           |  | Year Ended |   |           | Year Ended |  |   | Year Ended |   |  | Year Ended |          
|                                                                                                   |  | March 26,                                               |           |  | March 27,  |   |           | March 29,  |  |   | March 30,  |   |  | March 31,  |          
|Income Statement Data                                                                              |  | 2005                                                    |           |  | 2004       |   |           | 2003       |  |   | 2002       |   |  | 2001       |          
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|                                                                                                   |  | (Amounts in thousands of dollars except per share data) |          
|Income (loss) from continuing operations before discontinued
    operations and extraordinary item |  |                                                         | 1,167     |  |            |   | (2,214    | )          |  |   | 3,883      |   |  |            | (2,425    | ) |  |   | (1,303    | )
|Loss from discontinued operations, net of income tax of nil(2)                                     |  |                                                         |          |  |            |   |          |            |  |   | (828       | ) |  |            |          |   |  |   |          |  
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Income (loss) before extraordinary item                                                            |  |                                                         | 1,167     |  |            |   | (2,214    | )          |  |   | 3,055      |   |  |            | (2,425    | ) |  |   | (1,303    | )
|Extraordinary gain, net of income tax of nil(3)                                                    |  |                                                         |          |  |            |   |          |            |  |   | 9,042      |   |  |            |          |   |  |   |          |  
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Net income (loss) attributable to common stockholders                                              |  | $                                                       | 1,167     |  |            | $ | (2,214    | )          |  | $ | 12,097     |   |  | $          | (2,425    | ) |  | $ | (1,303    | )
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Net income (loss) per common share                                                                 |  | $                                                       | 0.16      |  |            | $ | (0.35     | )          |  | $ | 2.05       |   |  | $          | (0.38     | ) |  | $ | (0.21     | )
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Net income (loss) from continuing operations per common share                                      |  | $                                                       | 0.16      |  |            | $ | (0.35     | )          |  | $ | 1.92       |   |  | $          | (0.38     | ) |  | $ | (0.21     | )
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Net income (loss) per common share  diluted                                                       |  | $                                                       | 0.13      |  |            | $ | (0.35     | )          |  | $ | 1.28       |   |  | $          | (0.38     | ) |  | $ | (0.21     | )
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Weighted average common shares outstanding                                                         |  |                                                         | 7,298,544 |  |            |   | 6,313,308 |            |  |   | 6,313,308  |   |  |            | 6,313,381 |   |  |   | 6,313,558 |  
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Weighted average common shares outstanding  diluted                                               |  |                                                         | 9,614,508 |  |            |   | 6,313,308 |            |  |   | 9,502,564  |   |  |            | 6,313,381 |   |  |   | 6,313,558 |  
|                                                                                                   |  |                                                         |           |  |            |   |           |            |  |   |            |   |  |            |          
|Dividends per share                                                                                |  |                                                         |          |  |            |   |          |            |  |   |           |   |  |            |          |   |  |   |          |  

|                     |  |           |         |  |           |   |         |           |  |   |           |  |  |           |        |   |  |   |        | 
|-------------------- |  | --------- | ------- |  | --------- | - | ------- | --------- |  | - | --------- |  |  | --------- | ------ | - |  | - | ------ | 
|                     |  | As at     |         |  | As at     |   |         | As at     |  |   | As at     |  |  | As at     |       
|                     |  | March 26, |         |  | March 27, |   |         | March 29, |  |   | March 30, |  |  | March 31, |       
|                     |  | 2005      |         |  | 2004      |   |         | 2003      |  |   | 2002      |  |  | 2001      |       
|                     |  |           |         |  |           |   |         |           |  |   |           |  |  |           |       
|Working capital      |  | $         | 35,056  |  |           | $ | 34,730  |           |  | $ | 37,717    |  |  | $         | (1,114 | ) |  | $ | 524    | 
|Total assets         |  | $         | 199,721 |  |           | $ | 193,380 |           |  | $ | 171,146   |  |  | $         | 67,826 |   |  | $ | 63,826 | 
|Bank indebtedness    |  | $         | 74,254  |  |           | $ | 70,262  |           |  | $ | 58,086    |  |  | $         | 28,002 |   |  | $ | 26,554 | 
|Stockholders equity |  | $         | 40,198  |  |           | $ | 32,187  |           |  | $ | 29,327    |  |  | $         | 7,554  |   |  | $ | 9,858  | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Minority interest in loss of subsidiaries relates to the
    allocation of Mayors net income or loss to the minority
    stockholders of Mayors based on their common stock
    ownership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|(2) | The loss from discontinued operations for fiscal 2002 relates to
    the discontinued operations of the store at Tysons Galleria in
    McLean, Virginia which was closed in March 2003. Costs related
    to the discontinued operation include operating losses, costs to
    exit the lease, write-off of fixed assets and severance costs
    offset by the write-off of deferred revenue from landlord
    inducements. The net assets of the store are not significant.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   
|(3) | The extraordinary gain for fiscal 2002 relates to the
    acquisition of Mayors. Specifically, on August 20,
    2002, Birks made an investment of $15.05 million in
    Mayors. The investment consisted of 15,050 shares of
    Mayors preferred stock, originally convertible into
    3,333.33 shares of common stock for each preferred share
    with an allocated fair value of $11.2 million at the
    acquisition date. Birks also received 37,273,787 warrants to
    purchase shares of common stock, one-third at $0.30, one-third
    at $0.35 and one-third at $0.40. A fair value of
    $3.8 million has been allocated to the warrants. At the
    investment date the conversion of these preferred shares would
    have given Birks a 71.9% equity interest in the common stock of
    Mayors. The excess of the fair value assigned to the
    preferred shares over 71.9% of the net book value of
    Mayors, net of the fair value assigned to the warrants,
    amounting to $21.2 million has been determined to be
    negative goodwill. The negative goodwill has been accounted for
    by reducing property and equipment by $12.2 million with
    the balance of $9.0 million recorded as an extraordinary
    gain.

88



---



##### Table of Contents






UNAUDITED PRO FORMA CONDENSED CONSOLIDATED


FINANCIAL INFORMATION OF BIRKS








| |   |                                                                                                                                                                                                                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the issuance of Birks Class A voting shares in exchange for
    all outstanding minority-held Mayors common stock;                                                                                                                                                                                                      
|
| |  | the allocation of the purchase price, including transaction
    costs incurred by Birks and the value of Birks Class A
    voting shares to be issued to Mayors stockholders, to the
    assets acquired and liabilities assumed based on a preliminary
    estimate of their respective fair values at March 26, 2005; 
|
| |  | the issuance of Birks options and warrants to purchase Birks
    Class A voting shares in exchange for the outstanding
    Mayors options and warrants to purchase Mayors
    common stock other than those warrants held by Birks;                                                                                    
|
| |  | the accrual of and adjustment to Birks accumulated deficit
    for the estimated transaction costs that will be incurred by
    Mayors subsequent to March 26, 2005 in order to
    complete the merger, which are required to be expensed as
    incurred in accordance with SFAS No. 141
    Business Combinations;
|
| |  | the execution of the condition of the merger that all of the
    issued and outstanding Series A preferred shares of Birks
    and $5,000,000 aggregate principal amount of convertible notes
    of Birks be converted into Birks Class A voting shares and
    Birks Class B multiple voting shares; and               
|
| |  | the elimination of the Mayors minority interest in
    Birks consolidated financial statements.                                                                                                                                                                                                                        





| |   |                                                                                                                                                                                                                                                                       
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | recognition of amortization expense related to the fair value of
    the identifiable intangible assets acquired;                                                                                                                                                     
|
|
| |  | reversal of fees and other costs directly related to the
    transaction, incurred and expensed by Mayors during the
    year ended March 26, 2005, as those costs would have been
    incurred in the prior period in accordance with the pro forma
    assumptions;
|
|
| |  | recognition of compensation expense related to the vesting of
    options to purchase Birks Class A voting shares that will
    be exchanged for outstanding Mayors options to purchase
    Mayors common stock as a condition of the merger;                       
|
| |  | recognition of incremental interest expense due to borrowing
    from the Birks and Mayors credit facilities to fund
    the fees and other costs related to the merger; and                                                                                        
|
| |  | reversal of interest expense and foreign exchange gain related
    to the secured convertible notes of Birks converted into capital
    stock of Birks.                                                                                                               



89



---



##### Table of Contents







90



---



##### Table of Contents



HENRY BIRKS & SONS INC.


PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET AS OF
MARCH 26, 2005


|                                           |                                                 |                              |         |           |             |   |        |           |      |   |         |         | 
|------------------------------------------ | ----------------------------------------------- | ---------------------------- | ------- | --------- | ----------- | - | ------ | --------- | ---- | - | ------- | ------- | 
|                                           |                                                 |                              |         | Pro Forma |             |   |       
|                                           |                                                 | Historical                   |         |           | Adjustments |   |        | Pro Forma |     
|                                           |                                                 |                              |         |           |             |   |        |           |     
|                                           |                                                 | (Amounts shown in thousands) |        
|ASSETS                                    
|Current Assets:                            |                                                 |                              |         |           |             |   |        |           |      |   |         |        
|                                           | Cash and cash equivalents                       |                              | $       | 1,762     |             |   |        |           |      |   | $       | 1,762   | 
|                                           | Accounts receivable, net                        |                              |         | 9,805     |             |   |        |           |      |   |         | 9,805   | 
|                                           | Inventories                                     |                              |         | 136,999   |             |   |        |           |      |   |         | 136,999 | 
|                                           | Other current assets                            |                              |         | 2,951     |             |   |        |           |      |   |         | 2,951   | 
|                                           |                                                 |                              |         |           |             |   |        |           |     
|                                           | Total current assets                            |                              |         | 151,517   |             |   |        |           |      |   |         | 151,517 | 
|                                           |                                                 |                              |         |           |             |   |        |           |     
|Property and equipment, net                |                                                 |                              | 30,117  |           |             |   |        |           |      |   | 30,117  |        
|Goodwill                                   |                                                 |                              | 15,463  |           |             |   | 17,137 | (2a)      |      |   | 32,600  |        
|Intangible assets, net                     |                                                 |                              | 262     |           |             |   | 726    | (2a)      |      |   | 988     |        
|Other assets                               |                                                 |                              | 2,362   |           |             |   | 98     | (2b)      |      |   | 1,060   |        
|                                           |                                                 |                              |         |           |             |   | (1,399 | )(2a)     |      |   |         |        
|                                           |                                                 |                              |         |           |             |   | (1     | )(2e)     |      |   |         |        
|                                           |                                                 |                              |         |           |             |   |        |           |     
|TOTAL ASSETS                               |                                                 | $                            | 199,721 |           |             | $ | 16,561 |           |      | $ | 216,282 |        
|                                           |                                                 |                              |         |           |             |   |        |           |     
|                                          
|LIABILITIES                               
|Current Liabilities:                       |                                                 |                              |         |           |             |   |        |           |      |   |         |        
|                                           | Bank indebtedness                               |                              | $       | 74,254    |             |   |        |           |      |   | $       | 74,254  | 
|                                           | Accounts payable                                |                              |         | 22,571    |             |   |        |           |      |   |         | 22,571  | 
|                                           | Accrued liabilities                             |                              |         | 11,665    |             |   |        | 787       | (2a) |   |         | 12,745  | 
|                                           |                                                 |                              |         |           |             |   | 444    | (2c)      |      |   |         |        
|                                           |                                                 |                              |         |           |             |   | (151   | )(2d)     |      |   |         |        
|                                           | Other taxes payable                             |                              |         | 3,633     |             |   |        |           |      |   |         | 3,633   | 
|                                           | Loans for leasehold improvements and term loans |                              |         | 1,262     |             |   |        |           |      |   |         | 1,262   | 
|                                           | Current portion of long-term debt               |                              |         | 3,076     |             |   |        |           |      |   |         | 3,076   | 
|                                           |                                                 |                              |         |           |             |   |        |           |     
|Total current liabilities                  |                                                 |                              | 116,461 |           |             |   | 1,080  |           |      |   | 117,541 |        
|                                           |                                                 |                              |         |           |             |   |        |           |     
|Long-term debt                             |                                                 |                              | 28,555  |           |             |   |        |           |      |   | 28,555  |        
|Convertible notes                          |                                                 |                              | 5,000   |           |             |   | (5,000 | )(2d)     |      |   |        |        
|Other long-term liabilities                |                                                 |                              | 4,456   |           |             |   |        |           |      |   | 4,456   |        
|Minority interest                          |                                                 |                              | 1       |           |             |   | (1     | )(2e)     |      |   |        |        
|                                           |                                                 |                              |         |           |             |   |        |           |     
|Total Liabilities                          |                                                 |                              | 154,473 |           |             |   | (3,921 | )         |      |   | 150,552 |        
|                                           |                                                 |                              |         |           |             |   |        |           |     
|Convertible Preferred Stock                |                                                 |                              | 5,050   |           |             |   | (5,050 | )(2d)     |      |   |         |        
|                                          
|STOCKHOLDERS EQUITY                      
|Class A voting shares                      |                                                 |                              | 336     |           |             |   | 12,320 | (2a)      |      |   | 20,281  |        
|                                           |                                                 |                              |         |           |             |   | 7,625  | (2d)      |      |   |         |        
|Class B multiple voting shares             |                                                 |                              | 36,028  |           |             |   | 2,576  | (2d)      |      |   | 38,604  |        
|Additional paid-in capital                 |                                                 |                              | 16,867  |           |             |   | 3,357  | (2a)      |      |   | 20,322  |        
|                                           |                                                 |                              |         |           |             |   | 98     | (2b)      |      |   |         |        
|Accumulated deficit                        |                                                 |                              | (13,760 | )         |             |   | (444   | )(2c)     |      |   | (14,204 | )      
|Accumulated other comprehensive income     |                                                 |                              | 727     |           |             |   |        |           |      |   | 727     |        
|                                           |                                                 |                              |         |           |             |   |        |           |     
|Total stockholders equity                 |                                                 |                              | 40,198  |           |             |   | 25,532 |           |      |   | 65,730  |        
|TOTAL LIABILITIES AND STOCKHOLDERS EQUITY |                                                 | $                            | 199,721 |           |             | $ | 16,561 |           |      | $ | 216,282 |        
|                                           |                                                 |                              |         |           |             |   |        |           |     

91



---



##### Table of Contents



HENRY BIRKS & SONS INC.


PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS


FOR THE YEAR ENDED MARCH 26, 2005


|                                               |         |                                     |         |           |             |   |      |           |  |   |         |            | 
|---------------------------------------------- | ------- | ----------------------------------- | ------- | --------- | ----------- | - | ---- | --------- |  | - | ------- | ---------- | 
|                                               |         |                                     |         | Pro Forma |             |   |     
|                                               |         | Historical                          |         |           | Adjustments |   |      | Pro Forma | 
|                                               |         |                                     |         |           |             |   |      |           | 
|                                               |         | (Amounts shown in thousands, except |        
|                                               |         | share and per share data)           |        
|Net sales                                      |         | $                                   | 239,301 |           |             |   |     |           |  | $ | 239,301 |           
|Cost of sales                                  |         |                                     | 130,037 |           |             |   |     |           |  |   | 130,037 |           
|                                               |         |                                     |         |           |             |   |      |           | 
|Gross profit                                   |         |                                     | 109,264 |           |             |   |     |           |  |   | 109,264 |           
|                                               |         |                                     |         |           |             |   |      |           | 
|Selling, general and administrative expenses   |         |                                     | 95,764  |           |             |   | (824 | )(3b)     |  |   | 94,989  |           
|                                               |         |                                     |         |           |             |   | 49   | (3e)      |  |   |         |           
|Depreciation and amortization                  |         |                                     | 4,749   |           |             |   | 36   | (3a)      |  |   | 4,785   |           
|Other items                                    |         |                                     | (1,181  | )         |             |   |      |           |  |   | (1,181  | )         
|                                               |         |                                     |         |           |             |   |      |           | 
|Total operating expenses                       |         |                                     | 99,332  |           |             |   | (739 | )         |  |   | 98,593  |           
|                                               |         |                                     |         |           |             |   |      |           | 
|Operating income                               |         |                                     | 9,932   |           |             |   | 739  |           |  |   | 10,671  |           
|Interest on long-term debt                     |         |                                     | 2,906   |           |             |   | 401  | (3d)      |  |   | 3,307   |           
|Interest and other financial cost              |         |                                     | 5,759   |           |             |   | 115  | (3c)      |  |   | 5,824   |           
|                                               |         |                                     |         |           |             |   | (50  | )(3d)     |  |   |         |           
|Gain on sale of Mayors common shares          |         |                                     | (232    | )         |             |   |      |           |  |   | (232    | )         
|Loss on disposal of Mayors warrants           |         |                                     | 332     |           |             |   |     |           |  |   | 332     |           
|                                               |         |                                     |         |           |             |   |      |           | 
|                                               |         |                                     | 8,765   |           |             |   | 466  |           |  |   | 9,231   |           
|                                               |         |                                     |         |           |             |   |      |           | 
|Income before minority interest                |         |                                     | 1,167   |           |             |   | 273  |           |  |   | 1,440   |           
|                                               |         |                                     |         |           |             |   |      |           | 
|Net income attributable to common stockholders |         | $                                   | 1,167   |           |             | $ | 273  |           |  | $ | 1,440   |           
|                                               |         |                                     |         |           |             |   |      |           | 
|Weighted average common shares outstanding:    |         |                                     |         |           |             |   |      |           |  |   |         |           
|                                               | Basic   |                                     |         | 7,298,544 |             |   |      |           |  |   |         | 11,209,444 | 
|                                               | Diluted |                                     |         | 9,614,508 |             |   |      |           |  |   |         | 11,795,820 | 
|Earnings per common share:                     |         |                                     |         |           |             |   |      |           |  |   |         |           
|                                               | Basic   |                                     | $       | 0.16      |             |   |      |           |  |   | $       | 0.13       | 
|                                               |         |                                     |         |           |             |   |      |           | 
|                                               | Diluted |                                     | $       | 0.13      |             |   |      |           |  |   | $       | 0.12       | 
|                                               |         |                                     |         |           |             |   |      |           | 

92



---



##### Table of Contents



HENRY BIRKS & SONS INC.


NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED


FINANCIAL STATEMENTS


(Amounts shown in thousands, except share and per share
data)




|   |                      
|-- | ---------------------
|1. | Basis of Presentation



Business
Combinations. Goodwill and
Other Intangible Assets






|   |                                                                                
|-- | -------------------------------------------------------------------------------
|2. | Adjustments to the Unaudited Pro Forma condensed Consolidated
    Balance Sheet





| |   |                                                                                                                                                                                                                                                                                                                          
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the issuance of Birks Class A voting shares in exchange for
    all outstanding minority-held Mayors common stock;                                                                                                                                                                                                      
|
| |  | the allocation of the purchase price, including transaction
    costs incurred by Birks and the value of Birks Class A
    voting shares to be issued to Mayors stockholders, to the
    assets acquired and liabilities assumed based on a preliminary
    estimate of their respective fair values at March 26, 2005; 
|
| |  | the issuance of Birks options and warrants to purchase Birks
    Class A voting shares in exchange for the outstanding
    Mayors options and warrants to purchase Mayors
    common stock other than those warrants held by Birks;                                                                                    
|
| |  | the accrual of and adjustment to Birks accumulated deficit
    for the estimated transaction costs that will be incurred by
    Mayors subsequent to March 26, 2005 in order to
    complete the merger, which are required to be expensed as
    incurred in accordance with SFAS No. 141
    Business Combinations;
|
| |  | the execution of the condition of the merger that all of the
    issued and outstanding Series A preferred shares of Birks
    and $5,000 aggregate principal amount of convertible notes of
    Birks be converted into Birks Class A voting shares and
    Birks Class B multiple voting shares.                       



93



---



##### Table of Contents



HENRY BIRKS & SONS INC.


NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED


FINANCIAL STATEMENTS  (Continued)




|                                                                                                                                                            |           |   |        |     |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------- | --------- | - | ------ | --- | -
|Value of Birks Class A voting shares to acquire
    Mayors common stock                                                                                    |           | $ | 12,320 |    
|Birks options and warrants in exchange of Mayors options
    and warrants, net of intrinsic value of unvested options, ($975
    and $2,382, respectively) |           |   | 3,357  |    
|Fees and other costs of the merger incurred and expected to be
    incurred by Birks, including $1,399 deferred in other assets at
    March 26, 2005       |           |   | 2,186  |    
|                                                                                                                                                            |           |   |       
|Total purchase price                                                                                                                                        |           | $ | 17,863 |    
|                                                                                                                                                            |           |   |       
|Minority interest portion of estimated fair value of
    Mayors identifiable assets:                                                                       |           |   |        |    
|                                                                                                                                                            | Tradename |   | $      | 726 | *
|Estimated fair value of identifiable net assets acquired                                                                                                    |           | $ | 726    |    
|                                                                                                                                                            |           |   |       
|Excess of purchase price over net assets acquired                                                                                                           |           | $ | 17,137 | ** 
|                                                                                                                                                            |           |   |       






| |   |                                                                        
| | - | -----------------------------------------------------------------------
| | * | Amount included in pro forma adjustments to intangible assets,
    net.



|   |                                                      
|-- | -----------------------------------------------------
|** | Amount included in pro forma adjustments to goodwill.















| |   |                                                                                                                                                                                   
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Conversion of $5,000 convertible notes and related accrued
    interest of $151 into 512,015 Birks Class A voting shares
    and 504,876 Birks Class B multiple voting shares; and
|
| |  | Conversion of the Birks Series A preferred shares into
    1,034,272 Birks Class A voting shares.                                                                                 





|   |                                                                                      
|-- | -------------------------------------------------------------------------------------
|3. | Adjustments to Unaudited Pro Forma Consolidated Condensed
    Statement of Operations



|          |  |            |     |  |             |  |            |                |  |   |    | 
|--------- |  | ---------- | --- |  | ----------- |  | ---------- | -------------- |  | - | -- | 
|          |  | Estimated  |     |  |             |  | Year Ended |               
|          |  | Fair Value |     |  | Useful Life |  |            | March 26, 2005 | 
|          |  |            |     |  |             |  |            |                | 
|Tradename |  | $          | 726 |  |             |  | 20 years   |                |  | $ | 36 | 









94



---



##### Table of Contents



HENRY BIRKS & SONS INC.


NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED


FINANCIAL STATEMENTS  (Continued)














|                                   |  |                |     |  
|---------------------------------- |  | -------------- | --- | -
|                                   |  | Year Ended     |    
|                                   |  | March 26, 2005 |    
|                                   |  |                |    
|Interest and other financial costs |  | $              | (50 | )
|                                   |  |                |    
|Foreign exchange gain              |  | $              | 401 |  
|                                   |  |                |    





|                                                            |                                             |                |            |           | 
|----------------------------------------------------------- | ------------------------------------------- | -------------- | ---------- | --------- | 
|                                                            |                                             | Year Ended     |           
|                                                            |                                             | March 27, 2004 |           
|                                                            |                                             |                |           
|Class A voting shares:                                      |                                             |                |            |          
|Class A voting shares oustanding                            |                                             |                | 85,450     |          
|Conversion of convertible note and related accrued interest |                                             |                | 512,015    |          
|Conversion of Series A preferred shares                     |                                             |                | 1,034,272  |          
|Issuance to Mayors minority stockholders                   |                                             |                | 1,859,738  |          
|                                                            |                                             |                |           
|                                                            | Total Class A voting shares, basic          |                |            | 3,491,474 | 
|Class B multiple voting shares:                             |                                             |                |            |          
|Class B multiple voting shares outstanding                  |                                             |                | 7,213,094  |          
|Conversion of convertible note and related accrued interest |                                             |                | 504,876    |          
|                                                            | Total Class B multiple voting shares, basic |                |            | 7,717,970 | 
|Total common shares, basic                                  |                                             |                | 11,209,444 |          

95



---



##### Table of Contents






MANAGEMENTS DISCUSSION AND ANALYSIS OF


THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF BIRKS


The following discussion should be read in conjunction with,
and is qualified by, Birks consolidated financial
statements and the notes thereto included elsewhere in this
proxy statement/ prospectus. The following discussion includes
certain forward-looking statements. For a discussion of
important factors, including the continuing development of
Birks business, actions of regulatory authorities and
competitors and other factors which could cause actual results
to differ materially from the results referred to in the
forward-looking statements, see Risk factors and
Forward-looking statements.


Throughout this proxy statement/ prospectus, Birks refers to
its fiscal years ended March 26, 2005, March 27, 2004
and March 29, 2003 as fiscal 2004, fiscal 2003 and fiscal
2002, respectively. Birks fiscal year consists of 52 or
53 weeks, reported in four 13-week periods, and ends on the
last Saturday in March of each year. Fiscal 2002, 2003 and 2004
included 52 weeks.


Birks acquired approximately 72% of the voting control in
Mayors on August 20, 2002. Since that date, the
results of Mayors have been consolidated in Birks
financial statements, subject to the deduction of the minority
interest. As a result, Birks results in prior periods are
not directly comparable.





Overview



















96



---



##### Table of Contents























| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | execute its merchandising strategy to increase net sales and
    expand gross margin in existing stores by developing and
    marketing higher margin exclusive and unique products, and
    developing its internal capability to design, develop,
    manufacture or source products;                                                                                                                                                                                                                        
|
| |  | execute its marketing strategy to enhance customer awareness and
    appreciation of its two brands, Birks and Mayors, and to
    increase customer traffic and net sales through regional and
    national advertising campaigns on television, billboards, and
    print, catalog mailings, in-store client events, community
    relations, partnerships with key suppliers, such as Mayors
    relationship with Rolex, and associations with prestige
    institutions, such as the Royal Ontario Museum;
|
| |  | provide a superior client experience through consistent
    outstanding customer service that will ensure customer
    satisfaction and promote the frequency and value of customer
    spending;                                                                                                                                                                                                                                                                                                              
|
| |  | rationalize and integrate the activities between Birks
    U.S. operations and Canadian operations by providing for
    cost reduction and improved operations through the
    implementation of best practices; and                                                                                                                                                                                                                                                                                          
|
| |  | expand distribution by selective new store openings in existing
    and new markets.                                                                                                                                                                                                                                                                                                                                                                                                                           






| |                         
| | ------------------------
| | Trends and Uncertainties






















97



---



##### Table of Contents









| |            
| | -----------
| | Seasonality





| |                                             
| | --------------------------------------------
| | Store Openings and Closures and Acquisitions



|                               |  |                   |    |  |           |  |    |           |  |  |    | 
|------------------------------ |  | ----------------- | -- |  | --------- |  | -- | --------- |  |  | -- | 
|                               |  | Fiscal Year Ended |   
|                               |  |                   |   
|                               |  | March 26,         |    |  | March 27, |  |    | March 29, | 
|                               |  | 2005              |    |  | 2004      |  |    | 2003      | 
|                               |  |                   |    |  |           |  |    |           | 
|Stores at beginning of period: |  |                   | 65 |  |           |  | 66 |           |  |  | 37 | 
|Stores opened during period:   |  |                   | 1  |  |           |  | 0  |           |  |  | 3  | 
|Stores acquired during period: |  |                   | 0  |  |           |  | 0  |           |  |  | 29 | 
|Stores closed during period:   |  |                   | 0  |  |           |  | 1  |           |  |  | 3  | 
|                               |  |                   |    |  |           |  |    |           | 
|Stores at end of period:       |  |                   | 66 |  |           |  | 65 |           |  |  | 66 | 
|                               |  |                   |    |  |           |  |    |           | 





| |                 
| | ----------------
| | Foreign Currency





| |                       
| | ----------------------
| | Comparable Store Sales



98



---



##### Table of Contents








|                                           |  |                   |         |  |                |   |         |                |  |  |              |   |  |              |         |  |            |   |         |              |  |  |              |   |  |            |         |  |  |   |         |  |  |  |       |   
|------------------------------------------ |  | ----------------- | ------- |  | -------------- | - | ------- | -------------- |  |  | ------------ | - |  | ------------ | ------- |  | ---------- | - | ------- | ------------ |  |  | ------------ | - |  | ---------- | ------- |  |  | - | ------- |  |  |  | ----- | --
|                                           |  | Fiscal Year Ended |        
|                                           |  |                   |        
|                                           |  | March 26, 2005    |         |  | March 27, 2004 |   |         | March 29, 2003 | 
|                                           |  |                   |         |  |                |   |         |                | 
|                                           |  | Current year      |         |  | Prior year     |   |         | Percentage     |  |  | Current year |   |  | Prior year   |         |  | Percentage |   |         | Current year |  |  | Prior year   |   |  | Percentage |        
|                                           |  | net sales(2)      |         |  | net sales(3)   |   |         | change         |  |  | net sales(2) |   |  | net sales(3) |         |  | change     |   |         | net sales(2) |  |  | net sales(3) |   |  | change     |        
|                                           |  |                   |         |  |                |   |         |                |  |  |              |   |  |              |         |  |            |   |         |              |  |  |              |   |  |            |        
|Stores operating under the Birks brand(1)  |  | $                 | 110,792 |  |                | $ | 110,681 |                |  |  | 0.1          | % |  | $            | 109,926 |  |            | $ | 107,355 |              |  |  | 2.4          | % |  | $          | 106,100 |  |  | $ | 104,841 |  |  |  | 1.2%  |   
|Stores operating under the Mayors brand(1) |  | $                 | 134,005 |  |                | $ | 119,794 |                |  |  | 11.9         | % |  | $            | 119,105 |  |            | $ | 103,006 |              |  |  | 15.6         | % |  | $          | 110,647 |  |  | $ | 139,768 |  |  |  | (20.8 | )%
|                                           |  |                   |         |  |                |   |         |                |  |  |              |   |  |              |         |  |            |   |         |              |  |  |              |   |  |            |        









|    |                                                                                                                                                            
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(1) | Includes only those stores that have entered the comparable
    store sales calculation.                                                                   
|   
|   
|   
|(2) | Represents net sales in the comparable period of the current
    year in stores that were open for the comparable period in the
    current and prior year.
|   
|   
|   
|(3) | Represents net sales in the comparable period of the prior year
    in stores that were open for the comparable period in the
    current and prior year.  
|   



Results of Operations




99



---



##### Table of Contents





| |                                    
| | -----------------------------------
| | Fiscal 2004 Compared to Fiscal 2003



|                                                      |  |                        |         |   |           |   |         |  
|----------------------------------------------------- |  | ---------------------- | ------- | - | --------- | - | ------- | -
|                                                      |  | Fiscal Year Ended      |        
|                                                      |  |                        |        
|                                                      |  | March 26,              |         |   | March 27, |  
|                                                      |  | 2005                   |         |   | 2004      |  
|                                                      |  |                        |         |   |           |  
|                                                      |  | (Amounts in thousands) |        
|Net sales                                             |  | $                      | 239,301 |   |           | $ | 216,256 |  
|Cost of sales                                         |  |                        | 130,037 |   |           |   | 118,861 |  
|                                                      |  |                        |         |   |           |  
|Gross profit                                          |  |                        | 109,264 |   |           |   | 97,395  |  
|Selling, general and administrative expenses          |  |                        | 95,764  |   |           |   | 93,638  |  
|Depreciation and amortization                         |  |                        | 4,749   |   |           |   | 4,312   |  
|Other items                                           |  |                        | (1,181  | ) |           |   | 338     |  
|                                                      |  |                        |         |   |           |  
|Total operating expenses                              |  |                        | 99,332  |   |           |   | 98,288  |  
|                                                      |  |                        |         |   |           |  
|Operating income (loss)                               |  |                        | 9,932   |   |           |   | (893    | )
|Interest on long-term debt                            |  |                        | 2,906   |   |           |   | 2,858   |  
|Interest and other financial costs                    |  |                        | 5,759   |   |           |   | 5,312   |  
|Gain (loss) on sale of Mayors common shares          |  |                        | (232    | ) |           |   | 176     |  
|Loss on disposal of Mayors warrants                  |  |                        | 332     |   |           |   | 334     |  
|Interest and other income                             |  |                        |        |   |           |   | (184    | )
|                                                      |  |                        |         |   |           |  
|Income (loss) before minority interest                |  |                        | 1,167   |   |           |   | (9,389  | )
|Minority interest in loss of subsidiary               |  |                        |        |   |           |   | 7,175   |  
|                                                      |  |                        |         |   |           |  
|Net income (loss) attributable to common shareholders |  | $                      | 1,167   |   |           | $ | (2,214  | )
|                                                      |  |                        |         |   |           |  



| |           
| | ----------
| | Net Sales.

|                          |  |                        |         |  |           |   |         | 
|------------------------- |  | ---------------------- | ------- |  | --------- | - | ------- | 
|                          |  | Fiscal Year Ended      |        
|                          |  |                        |        
|                          |  | March 26,              |         |  | March 27, |  
|                          |  | 2005                   |         |  | 2004      |  
|                          |  |                        |         |  |           |  
|                          |  | (Amounts in thousands) |        
|Net sales  Canada        |  | $                      | 96,600  |  |           | $ | 90,825  | 
|Net sales  United States |  |                        | 142,701 |  |           |   | 125,431 | 
|                          |  |                        |         |  |           |  
|Total net sales           |  | $                      | 239,301 |  |           | $ | 216,256 | 
|                          |  |                        |         |  |           |  











| |               
| | --------------
| | Cost of Sales.

|                              |  |                        |         |  |           |   |         | 
|----------------------------- |  | ---------------------- | ------- |  | --------- | - | ------- | 
|                              |  | Fiscal Year Ended      |        
|                              |  |                        |        
|                              |  | March 26,              |         |  | March 27, |  
|                              |  | 2005                   |         |  | 2004      |  
|                              |  |                        |         |  |           |  
|                              |  | (Amounts in thousands) |        
|Cost of sales  Canada        |  | $                      | 48,322  |  |           | $ | 45,434  | 
|Cost of sales  United States |  |                        | 81,715  |  |           |   | 73,427  | 
|                              |  |                        |         |  |           |  
|Total cost of sales           |  | $                      | 130,037 |  |           | $ | 118,861 | 
|                              |  |                        |         |  |           |  

100



---



##### Table of Contents














Gross Profit.







| |                                              
| | ---------------------------------------------
| | Selling, General and Administrative Expenses.

|                                                                 |  |                   |        |  |           |   |        | 
|---------------------------------------------------------------- |  | ----------------- | ------ |  | --------- | - | ------ | 
|                                                                 |  | Fiscal Year Ended |       
|                                                                 |  |                   |       
|                                                                 |  | March 26,         |        |  | March 27, |  
|                                                                 |  | 2005              |        |  | 2004      |  
|                                                                 |  |                   |        |  |           |  
|                                                                 |  | ($ In thousands)  |       
|Selling, general and administrative
    expenses  Canada        |  | $                 | 42,035 |  |           | $ | 41,355 | 
|Selling, general and administrative
    expenses  United States |  |                   | 53,729 |  |           |   | 52,283 | 
|                                                                 |  |                   |        |  |           |  
|Total selling, general and administrative expenses               |  | $                 | 95,764 |  |           | $ | 93,638 | 
|                                                                 |  |                   |        |  |           |  









Depreciation and Amortization.


Other items.


101



---



##### Table of Contents



Interest on Long-Term Debt.


Interest and Other Financial Costs.


Minority Interest in Loss of Subsidiary.




| |                                    
| | -----------------------------------
| | Fiscal 2003 Compared to Fiscal 2002



|                                                                                                                         |  |                   |         |   |           |   |         |  
|------------------------------------------------------------------------------------------------------------------------ |  | ----------------- | ------- | - | --------- | - | ------- | -
|                                                                                                                         |  | Fiscal Year Ended |        
|                                                                                                                         |  |                   |        
|                                                                                                                         |  | March 27,         |         |   | March 29, |  
|                                                                                                                         |  | 2004              |         |   | 2003      |  
|                                                                                                                         |  |                   |         |   |           |  
|                                                                                                                         |  | ($ In thousands)  |        
|Net sales                                                                                                                |  | $                 | 216,256 |   |           | $ | 151,312 |  
|Cost of sales                                                                                                            |  |                   | 118,861 |   |           |   | 83,698  |  
|                                                                                                                         |  |                   |         |   |           |  
|Gross profit                                                                                                             |  |                   | 97,395  |   |           |   | 67,614  |  
|Selling, general and administrative expenses                                                                             |  |                   | 93,638  |   |           |   | 63,890  |  
|Depreciation and amortization                                                                                            |  |                   | 4,312   |   |           |   | 3,256   |  
|Other items                                                                                                              |  |                   | 338     |   |           |   | (210    | )
|                                                                                                                         |  |                   |         |   |           |  
|Total operating expenses                                                                                                 |  |                   | 98,288  |   |           |   | 66,936  |  
|                                                                                                                         |  |                   |         |   |           |  
|Operating (loss) income                                                                                                  |  |                   | (893    | ) |           |   | 678     |  
|Interest on long-term debt                                                                                               |  |                   | 2,858   |   |           |   | 2,448   |  
|Interest and other financial costs                                                                                       |  |                   | 5,312   |   |           |   | 3,486   |  
|Loss on sale of Mayors common shares                                                                                    |  |                   | 176     |   |           |   |        |  
|Loss on disposal of Mayors warrants                                                                                     |  |                   | 334     |   |           |   | 312     |  
|Interest and other income                                                                                                |  |                   | (184    | ) |           |   | (389    | )
|                                                                                                                         |  |                   |         |   |           |  
|Loss from continuing operations before income tax, minority
    interest, discontinued operations and extraordinary item |  |                   | (9,389  | ) |           |   | (5,179  | )
|Income tax benefit                                                                                                       |  |                   |        |   |           |   | 991     |  
|                                                                                                                         |  |                   |         |   |           |  
|Loss from continuing operations before minority interest,
    discontinued operations and extraordinary item             |  |                   | (9,389  | ) |           |   | (4,188  | )
|Minority interest in loss of subsidiary                                                                                  |  |                   | 7,175   |   |           |   | 8,071   |  
|                                                                                                                         |  |                   |         |   |           |  
|(Loss) income from continuing operations before discontinued
    operations and extraordinary item                       |  |                   | (2,214  | ) |           |   | 3,883   |  
|Loss from discontinued operations, net of income tax of nil                                                              |  |                   |        |   |           |   | (828    | )
|                                                                                                                         |  |                   |         |   |           |  
|(Loss) income before extraordinary item                                                                                  |  |                   | (2,214  | ) |           |   | 3,055   |  
|Extraordinary gain, net of income tax of nil                                                                             |  |                   |        |   |           |   | 9,042   |  
|                                                                                                                         |  |                   |         |   |           |  
|Net (loss) income attributable to common shareholders                                                                    |  | $                 | (2,214  | ) |           | $ | 12,097  |  
|                                                                                                                         |  |                   |         |   |           |  

102



---



##### Table of Contents





| |           
| | ----------
| | Net Sales.

|                          |  |                   |         |  |           |   |         | 
|------------------------- |  | ----------------- | ------- |  | --------- | - | ------- | 
|                          |  | Fiscal Year Ended |        
|                          |  |                   |        
|                          |  | March 27,         |         |  | March 29, |  
|                          |  | 2004              |         |  | 2003      |  
|                          |  |                   |         |  |           |  
|                          |  | ($ In thousands)  |        
|Net sales  Canada        |  | $                 | 90,825  |  |           | $ | 78,444  | 
|Net sales  United States |  |                   | 125,431 |  |           |   | 72,868  | 
|                          |  |                   |         |  |           |  
|Total net sales           |  | $                 | 216,256 |  |           | $ | 151,312 | 
|                          |  |                   |         |  |           |  











| |               
| | --------------
| | Cost of Sales.

|                              |  |                   |         |  |           |   |        | 
|----------------------------- |  | ----------------- | ------- |  | --------- | - | ------ | 
|                              |  | Fiscal Year Ended |        
|                              |  |                   |        
|                              |  | March 27,         |         |  | March 29, |  
|                              |  | 2004              |         |  | 2003      |  
|                              |  |                   |         |  |           |  
|                              |  | ($ In thousands)  |        
|Cost of sales  Canada        |  | $                 | 45,434  |  |           | $ | 37,879 | 
|Cost of sales  United States |  |                   | 73,427  |  |           |   | 45,819 | 
|                              |  |                   |         |  |           |  
|Total cost of sales           |  | $                 | 118,861 |  |           | $ | 83,698 | 
|                              |  |                   |         |  |           |  









Gross Profit.


103



---



##### Table of Contents







| |                                     
| | ------------------------------------
| | Selling, General and Administrative.

|                                                                 |  |                   |        |  |           |   |        | 
|---------------------------------------------------------------- |  | ----------------- | ------ |  | --------- | - | ------ | 
|                                                                 |  | Fiscal Year Ended |       
|                                                                 |  |                   |       
|                                                                 |  | March 27,         |        |  | March 29, |  
|                                                                 |  | 2004              |        |  | 2003      |  
|                                                                 |  |                   |        |  |           |  
|                                                                 |  | ($ In thousands)  |       
|Selling, general and administrative
    expenses  Canada        |  | $                 | 41,355 |  |           | $ | 34,215 | 
|Selling, general and administrative
    expenses  United States |  |                   | 52,283 |  |           |   | 29,675 | 
|                                                                 |  |                   |        |  |           |  
|Total selling, general and administrative expenses               |  | $                 | 93,638 |  |           | $ | 63,890 | 
|                                                                 |  |                   |        |  |           |  









Depreciation and Amortization.


Other items.


Interest on Long-term Debt.


Interest and Other Financial Costs.


Interest and Other Income.


Income Taxes.


104



---



##### Table of Contents



Loss from Discontinued Operations.


Minority Interest in Loss of Subsidiary.


Extraordinary gain.


Liquidity and Capital Resources










| |   |                                 
| | - | --------------------------------
| |  | $5.0 million in fiscal 2005; and
|
| |  | $5.0 million in fiscal 2006.    





| |   |                                                                                                                         
| | - | ------------------------------------------------------------------------------------------------------------------------
| |  | $7.0 million as at March 31, 2005 until the fiscal
    quarter ending September 30, 2005; and                           
|
| |  | $9.5 million as at the fiscal quarter ending
    December 31, 2005 and for each fiscal quarter through
    July 1, 2007.





105



---



##### Table of Contents







|                                              |  |                   |        |   |           |   |        |           |  |   |        |  
|--------------------------------------------- |  | ----------------- | ------ | - | --------- | - | ------ | --------- |  | - | ------ | -
|                                              |  | Fiscal Year Ended |       
|                                              |  |                   |       
|                                              |  | March 26,         |        |   | March 27, |   |        | March 29, | 
|                                              |  | 2005              |        |   | 2004      |   |        | 2003      | 
|                                              |  |                   |        |   |           |   |        |           | 
|                                              |  | ($ In thousands)  |       
|Birks Facility                                |  |                   |        |   |           |   |        |           |  |   |        |  
|Borrowing at period end                       |  | $                 | 40,753 |   |           | $ | 37,257 |           |  | $ | 34,803 |  
|Additional borrowings available at period end |  | $                 | 4,033  |   |           | $ | 2,212  |           |  | $ | 1,427  |  
|Average outstanding balance during the period |  | $                 | 39,920 |   |           | $ | 40,763 |           |  | $ | 32,005 |  
|Weighted average interest rate for period     |  |                   | 4.51   | % |           |   | 5.28   | %         |  |   | 5.11   | %
|Mayors Facility                              |  |                   |        |   |           |   |        |           |  |   |        |  
|Borrowing at period end                       |  | $                 | 33,501 |   |           | $ | 33,005 |           |  | $ | 23,283 |  
|Additional borrowings available at period end |  | $                 | 13,300 |   |           | $ | 16,300 |           |  | $ | 18,000 |  
|Average outstanding balance during the period |  | $                 | 35,178 |   |           | $ | 31,004 |           |  | $ | 34,609 |  
|Weighted average interest rate for period     |  |                   | 5.6    | % |           |   | 6.30   | %         |  |   | 10.2   | %







106



---



##### Table of Contents







|                                           |  |                   |       |  |           |   |       |           |  |   |       | 
|------------------------------------------ |  | ----------------- | ----- |  | --------- | - | ----- | --------- |  | - | ----- | 
|                                           |  | Fiscal Year Ended |      
|                                           |  |                   |      
|                                           |  | March 26,         |       |  | March 27, |   |       | March 29, | 
|                                           |  | 2005              |       |  | 2004      |   |       | 2003      | 
|                                           |  |                   |       |  |           |   |       |           | 
|Purchase of new property                   |  | $                 | 1,517 |  |           |   |      |           |  |   |      | 
|New stores and remodeling of old stores    |  |                   | 686   |  |           | $ | 1,571 |           |  | $ | 3,047 | 
|Other leasehold improvements               |  |                   | 220   |  |           |   | 384   |           |  |   | 311   | 
|Electronic equipment and computer hardware |  |                   | 1,126 |  |           |   | 1,538 |           |  |   | 284   | 
|Furniture and fixtures                     |  |                   | 238   |  |           |   | 309   |           |  |   | 305   | 
|Manufacturing equipment                    |  |                   | 448   |  |           |   | 53    |           |  |   | 11    | 
|Other                                      |  |                   | 327   |  |           |   | 206   |           |  |   | 233   | 
|                                           |  |                   |       |  |           |   |       |           | 
|Total capital expenditures                 |  | $                 | 4,562 |  |           | $ | 4,062 |           |  | $ | 4,191 | 
|                                           |  |                   |       |  |           |   |       |           | 





Commitments and Contractual Obligations




|                                |  |                       |         |           |        |   |        |           |           |   |           |  |  |         |        |  |  |   |        | 
|------------------------------- |  | --------------------- | ------- | --------- | ------ | - | ------ | --------- | --------- | - | --------- |  |  | ------- | ------ |  |  | - | ------ | 
|                                |  | Payment Due by Period |        
|                                |  |                       |        
|                                |  |                       |         | Less Than |        |   |        |           | More Than |  
|Contractual Obligations         |  | Total                 |         |           | 1 Year |   |        | 1-3 Years |           |   | 3-5 Years |  |  | 5 Years |       
|                                |  |                       |         |           |        |   |        |           |           |   |           |  |  |         |       
|                                |  | ($ In thousands)      |        
|Debt maturities                 |  | $                     | 17,592  |           |        | $ | 2,770  |           |           | $ | 13,767    |  |  | $       | 1,055  |  |  | $ |       | 
|Capital lease obligations       |  |                       | 14,039  |           |        |   | 306    |           |           |   | 353       |  |  |         | 322    |  |  |   | 13,058 | 
|Employment agreements(1)        |  |                       | 4,067   |           |        |   | 1,771  |           |           |   | 2,296     |  |  |         |       |  |  |   |       | 
|Operating lease obligations(2)  |  |                       | 73,393  |           |        |   | 13,080 |           |           |   | 22,725    |  |  |         | 17,319 |  |  |   | 20,269 | 
|Fixed rate interest expenses(3) |  |                       | 21,109  |           |        |   | 3,238  |           |           |   | 3,391     |  |  |         | 2,753  |  |  |   | 11,727 | 
|                                |  |                       |         |           |        |   |        |           |           |   |           |  |  |         |       
|Total                           |  | $                     | 130,200 |           |        | $ | 21,165 |           |           | $ | 42,532    |  |  | $       | 21,449 |  |  | $ | 45,054 | 
|                                |  |                       |         |           |        |   |        |           |           |   |           |  |  |         |       






|    |                                                                                                                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Employment agreements do not include any open-ended employment
    contracts.                                                                                                                                                              
|   
|(2) | The operating lease obligations do not include insurance, taxes
    and common area maintenance (CAM) charges to which Birks is
    obligated. CAM charges were $2,751 in fiscal 2004, $2,448 in
    fiscal 2003 and $2,644 in fiscal 2002.

107



---



##### Table of Contents





|    |                                                                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(3) | The fixed rate interest expenses do not include floating rate
    interest payable on $78.1 million of floating rate debt,
    which as of March 26, 2005 bore interest at an average
    annual rate of 5.02%.

Off-Balance Sheet Arrangements










Leases








Critical Accounting Policies and Estimates








| |                    
| | -------------------
| | Revenue recognition









108



---



##### Table of Contents







| |                                                             
| | ------------------------------------------------------------
| | Allowance for inventory shrink and slow moving
    inventory







| |                                
| | -------------------------------
| | Allowance for doubtful accounts





| |                  
| | -----------------
| | Long-Lived Assets



Recent Accounting Pronouncements






109



---



##### Table of Contents









Accounting Changes and Error Corrections  a
replacement of APB Opinion No. 20 and FASB Statement
No. 3. Accounting Changes Reporting Accounting Changes in Interim Financial
Statements


Inflation




Quantitative and Qualitative Disclosures About Market Risk






| |                   
| | ------------------
| | Interest rate risk



110



---



##### Table of Contents





| |              
| | -------------
| | Currency Risk





| |               
| | --------------
| | Commodity Risk



111



---



##### Table of Contents






DESCRIPTION OF BIRKS BUSINESS


When used in this section, as in the other sections of
this proxy statement/ prospectus, Birks refers to
Henry Birks & Sons Inc. and its subsidiaries, including
Mayors.


General
















Products






112



---



##### Table of Contents









Product Development and Sourcing






| |                                                    
| | ---------------------------------------------------
| | Diamond, Gemstone, Pearl and Precious Metal Jewelry





| |        
| | -------
| | Watches





| |               
| | --------------
| | Other Products



113



---



##### Table of Contents





| |              
| | -------------
| | Manufacturing





Availability of Products






Seasonality




Retail Operations, Merchandising and Marketing




| |        
| | -------
| | General





114



---



##### Table of Contents





| |                       
| | ----------------------
| | Personnel and Training







| |                          
| | -------------------------
| | Advertising and Promotion







| |                  
| | -----------------
| | Credit Operations







Distribution




115



---



##### Table of Contents





Competition




Regulation






Trademarks and Copyrights




Employees




116



---



##### Table of Contents



Properties






|                         |  |               |        |     |                     |  |                |          |  |  |                      | 
|------------------------ |  | ------------- | ------ | --- | ------------------- |  | -------------- | -------- |  |  | -------------------- | 
|                         |  | Size          |        |     |                     |  |               
|                         |  | (Square Feet) |        |     | Expiration of Lease |  |                | Location | 
|                         |  |               |        |     |                     |  |                |          | 
|Operating Stores         |  |               |        |     |                     |  |                |          |  |  |                      | 
|Bayshore Centre          |  |               | 2,519  |     |                     |  | September 2008 |          |  |  | Nepean, ON           | 
|Bloor                    |  |               | 15,620 |     |                     |  | September 2014 |          |  |  | Toronto, ON          | 
|Carrefour Laval          |  |               | 3,425  |     |                     |  | June 2012      |          |  |  | Laval, QC            | 
|Chinook Shopping Centre  |  |               | 2,342  |     |                     |  | March 2015     |          |  |  | Calgary, AB          | 
|Cornwall Centre          |  |               | 2,349  |     |                     |  | April 2010     |          |  |  | Regina, SK           | 
|Fairview Mall            |  |               | 2,115  |     |                     |  | August 2008    |          |  |  | North York, ON       | 
|Fairview Pointe-Claire   |  |               | 4,210  |     |                     |  | January 2007   |          |  |  | Pointe-Claire, QC    | 
|First Canadian Place     |  |               | 2,243  |     |                     |  | May 2008       |          |  |  | Toronto, ON          | 
|Guildford Town Centre    |  |               | 3,755  |     |                     |  | August 2007    |          |  |  | Surrey, B.C.         | 
|Halifax                  |  |               | 3,316  |     |                     |  | January 2009   |          |  |  | Halifax, N.S.        | 
|Hillside Shopping Centre |  |               | 3,639  |     |                     |  | March 2010(1)  |          |  |  | Victoria, B.C.       | 
|Lime Ridge Mall          |  |               | 2,473  |     |                     |  | September 2011 |          |  |  | Hamilton, ON         | 
|London Galleria          |  |               | 5,179  |     |                     |  | August 2009    |          |  |  | London, ON           | 
|Manulife Place           |  |               | 4,196  |     |                     |  | November 2009  |          |  |  | Edmonton, AB         | 
|Montreal Store           |  |               | 19,785 | (2) |                     |  | December 2020  |          |  |  | Montreal, QC         | 
|Oakridge Shopping Centre |  |               | 2,176  |     |                     |  | May 2008       |          |  |  | Vancouver, B.C.      | 
|Oakville Place           |  |               | 2,729  |     |                     |  | March 2010(1)  |          |  |  | Oakville, ON         | 
|Park Royal               |  |               | 3,537  |     |                     |  | September 2007 |          |  |  | West Vancouver, B.C. | 
|Pen Centre               |  |               | 3,588  |     |                     |  | April 2007     |          |  |  | St. Catherines, ON   | 
|Place Ste-Foy            |  |               | 4,048  |     |                     |  | November 2005  |          |  |  | Ste-Foy, QC          | 
|Polo Park Centre         |  |               | 3,920  |     |                     |  | January 2007   |          |  |  | Winnipeg, MB         | 
|Promenades St-Bruno      |  |               | 2,335  |     |                     |  | February 2008  |          |  |  | St-Bruno, QC         | 
|Rideau Centre            |  |               | 7,233  |     |                     |  | April 2009     |          |  |  | Ottawa, ON           | 
|Richmond Centre          |  |               | 1,562  |     |                     |  | April 2007(3)  |          |  |  | Richmond, B.C.       | 
|Rockland Centre          |  |               | 3,019  |     |                     |  | August 2008    |          |  |  | Mont Royal, QC       | 
|Saskatoon                |  |               | 4,280  |     |                     |  | October 2008   |          |  |  | Saskatoon, SK        | 
|Scarborough Town Centre  |  |               | 3,709  |     |                     |  | May 2008       |          |  |  | Scarborough, ON      | 

117



---



##### Table of Contents






|                                |  |               |        |  |                     |  |                 |          |  |  |                        | 
|------------------------------- |  | ------------- | ------ |  | ------------------- |  | --------------- | -------- |  |  | ---------------------- | 
|                                |  | Size          |        |  |                     |  |                
|                                |  | (Square Feet) |        |  | Expiration of Lease |  |                 | Location | 
|                                |  |               |        |  |                     |  |                 |          | 
|Sherway Gardens                 |  |               | 4,611  |  |                     |  | February 2010   |          |  |  | Etobicoke, ON          | 
|Southcentre Shopping Centre     |  |               | 2,986  |  |                     |  | August 2009     |          |  |  | Calgary, AB            | 
|Southgate Shopping Centre       |  |               | 2,905  |  |                     |  | September 2008  |          |  |  | Edmonton, AB           | 
|Square One                      |  |               | 3,211  |  |                     |  | April 2012      |          |  |  | Mississauga, ON        | 
|St-John                         |  |               | 3,306  |  |                     |  | Fall 2005(4)    |          |  |  | St-John, N.B.          | 
|Toronto Dominion Square         |  |               | 7,895  |  |                     |  | October 2011    |          |  |  | Calgary, AB            | 
|Toronto Eaton Centre            |  |               | 4,470  |  |                     |  | April 2012      |          |  |  | Toronto, ON            | 
|Vancouver                       |  |               | 20,221 |  |                     |  | January 2010    |          |  |  | Vancouver, B.C.        | 
|Victoria                        |  |               | 2,460  |  |                     |  | December 2011   |          |  |  | Victoria, B.C.         | 
|West Edmonton Mall              |  |               | 3,730  |  |                     |  | March 2010      |          |  |  | Edmonton, AB           | 
|Whistler                        |  |               | 552    |  |                     |  | December 2008   |          |  |  | Whistler, B.C.         | 
|Yorkdale                        |  |               | 2,530  |  |                     |  | April 2015      |          |  |  | Toronto, ON            | 
|Altamonte Mall                  |  |               | 5,782  |  |                     |  | January 2011    |          |  |  | Altamonte Springs, FL  | 
|Aventura Mall                   |  |               | 3,447  |  |                     |  | January 2009    |          |  |  | N. Miami Beach, FL     | 
|Bell Tower                      |  |               | 4,578  |  |                     |  | January 2012    |          |  |  | Fort Myers, FL         | 
|Boca Town Center                |  |               | 5,878  |  |                     |  | January 2007    |          |  |  | Boca Raton, FL         | 
|Brandon Town Center             |  |               | 4,110  |  |                     |  | June 2005       |          |  |  | Brandon, FL            | 
|Broward Mall                    |  |               | 2,236  |  |                     |  | January 2010    |          |  |  | Plantation, FL         | 
|Buckhead Store                  |  |               | 10,000 |  |                     |  | April 2009      |          |  |  | Atlanta, GA            | 
|Citrus Park Town Center         |  |               | 3,953  |  |                     |  | January 2010    |          |  |  | Tampa, FL              | 
|City Place at West Palm Beach   |  |               | 6,113  |  |                     |  | January 2011    |          |  |  | West Palm Beach, FL    | 
|Dadeland Mall                   |  |               | 5,700  |  |                     |  | January 2007    |          |  |  | Miami, FL              | 
|The Falls                       |  |               | 1,643  |  |                     |  | January 2009    |          |  |  | Miami, FL              | 
|Florida Mall                    |  |               | 5,070  |  |                     |  | January 2010    |          |  |  | Orlando, FL            | 
|The Galleria at Fort Lauderdale |  |               | 3,682  |  |                     |  | January 2005(5) |          |  |  | Ft. Lauderdale, FL     | 
|International Plaza             |  |               | 5,583  |  |                     |  | January 2012    |          |  |  | Tampa, FL              | 
|Lenox Square Mall               |  |               | 4,587  |  |                     |  | December 2005   |          |  |  | Atlanta, GA            | 
|Lincoln Road                    |  |               | 4,250  |  |                     |  | May 2009        |          |  |  | Miami Beach, FL        | 
|Mall of Georgia                 |  |               | 3,486  |  |                     |  | January 2010    |          |  |  | Buford, GA             | 
|Mall at Millenia                |  |               | 4,532  |  |                     |  | January 2013    |          |  |  | Orlando, FL            | 
|Mall at Wellington Green        |  |               | 4,001  |  |                     |  | January 2012    |          |  |  | Wellington, FL         | 
|Miami International Mall        |  |               | 3,226  |  |                     |  | January 2006    |          |  |  | Miami, FL              | 
|North Point Mall                |  |               | 4,752  |  |                     |  | January 2012    |          |  |  | Alpharetta, GA         | 
|Perimeter Mall                  |  |               | 5,157  |  |                     |  | January 2009    |          |  |  | Atlanta, GA            | 
|PGA Commons(6)                  |  |               | 5,197  |  |                     |  | April 2014      |          |  |  | Palm Beach Gardens, FL | 
|Seminole Towne Center           |  |               | 3,461  |  |                     |  | January 2006    |          |  |  | Sanford, FL            | 
|The Shops at Sunset Place       |  |               | 2,051  |  |                     |  | January 2010    |          |  |  | South Miami, FL        | 
|Southgate Plaza                 |  |               | 4,605  |  |                     |  | March 2010      |          |  |  | Sarasota, FL           | 
|Treasure Coast Square           |  |               | 2,506  |  |                     |  | January 2006    |          |  |  | Jensen Beach, FL       | 
|Village of Merrick Park         |  |               | 4,894  |  |                     |  | January 2013    |          |  |  | Coral Gables, FL       | 
|                               
|Other Properties                |  |               |        |  |                     |  |                 |          |  |  |                        | 
|Rhode Island(8)(9)              |  |               | 19,200 |  |                     |  | March 2025(7)   |          |  |  | Woonsocket, R.I.       | 
|Cavelti Factory(8)              |  |               | 828    |  |                     |  | January 2006    |          |  |  | Vancouver, B.C.        | 
|Overdale Avenue(10)             |  |               | 15,000 |  |                     |  | February 2007   |          |  |  | Montreal, QC           | 









|    |                                                                                              
|--- | ---------------------------------------------------------------------------------------------
|(1) | Based on terms and conditions of a negotiated lease that has not
    yet been fully executed.

118



---



##### Table of Contents





|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | This represents the retail square footage. The total area of
    Birks head office building, which includes the Montreal
    store is 78,229 square feet. The remaining area of
    58,444 square feet is used for offices, factories and a
    distribution center.                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|(3) | The lease includes one time option for an early termination of
    the lease, in favor of Birks, which can be exercised between
    April 2005 and October 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   
|(4) | Birks sold its St. John store in March 2005 and is planning to
    relocate to a new leased location in the fall of 2005. The new
    lease is for a 2,038 square foot store and expires in
    August 2015.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   
|(5) | Negotiations are underway for a new lease with additional space.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   
|(6) | This store opened on April 2, 2004 and was a relocation to
    a free standing store format from the previous location within
    The Gardens of the Palm Beaches Mall.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|(7) | In March 2005 Birks entered into a 20-year financing lease, at
    the end of which Birks will have the option to purchase the
    property for $1,000. For tax purposes, Birks is considered the
    current owner of the property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|(8) | Manufacturing facility.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   
|   
|(9) | In March 2005, Birks acquired the manufacturing facility in
    Rhode Island. The facility was acquired from Scojen, Limited
    Partnership with a $1.3 million loan from the Rhode Island
    Industrial Facilities Corporation, the RIIFC, and a loan
    guaranty from the Rhode Island Industrial-Recreational Building
    Authority, the IRBA. The IRBA and RIIFC are quasi-public
    corporations created by the State of Rhode Island to promote
    economic development in Rhode Island. The loan was effected
    through a structure consisting of capital lease financing and
    mortgage insurance. The term of the lease is 20 years at an
    interest cost of 5% per annum plus a 1% guarantee fee per annum.
|   






|     |                     
|---- | --------------------
|(10) | Distribution center.






Legal Proceedings




119



---



##### Table of Contents






MANAGEMENT OF BIRKS




Executive Officers and Directors







|                               |  |     |    |  |          |                                                             
|------------------------------ |  | --- | -- |  | -------- | ------------------------------------------------------------
|Name                           |  | Age |    |  | Position
|                               |  |     |    |  |         
|Dr. Lorenzo Rossi di Montelera |  |     | 65 |  |          | Chairman of the Board                                       
|Thomas A. Andruskevich         |  |     | 54 |  |          | President, Chief Executive Officer, and Director            
|Shirley A. Dawe                |  |     | 59 |  |          | Director                                                    
|Margherita Oberti              |  |     | 60 |  |          | Director                                                    
|Peter R. OBrien               |  |     | 59 |  |          | Director                                                    
|Filippo Recami                 |  |     | 54 |  |          | Director                                                    
|Michael Rabinovitch            |  |     | 35 |  |          | Senior Vice President and Chief Financial Officer           
|Lawrence Litowitz              |  |     | 54 |  |          | Principal Financial Officer and Principal Accounting Officer
|Daisy Chin-Lor                 |  |     | 51 |  |          | Senior Vice President and Chief Marketing Officer           
|Carlo Coda-Nunziante           |  |     | 41 |  |          | Group Vice President for Strategy and Business Development  
|Randolph Dirth                 |  |     | 50 |  |          | Group Vice President, Merchandising                         
|John C. Orrico                 |  |     | 48 |  |          | Group Vice President, Supply Chain Operations               
|Marco I. Pasteris              |  |     | 44 |  |          | Group Vice President for Finance                            
|Sabine Bruckert                |  |     | 44 |  |          | Vice President, General Counsel, and Corporate Secretary    
|Jocelyn Désy                   |  |     | 53 |  |          | Vice President, Corporate Sales                             
|Hélène Messier                 |  |     | 45 |  |          | Vice President, Human Resources                             
|Albert J. Rahm, II             |  |     | 52 |  |          | Vice President, Retail Store Operations                     




Directors





Dr. Lorenzo Rossi di Montelera





Thomas A. Andruskevich


Shirley A. Dawe


120



---



##### Table of Contents





Margherita Oberti


Peter R. OBrien


Filippo Recami


Other Executive Officers





Michael Rabinovitch,








Lawrence Litowitz





Daisy Chin-Lor


121



---



##### Table of Contents





Carlo Coda-Nunziante


Randolph Dirth


John C. Orrico


Marco Pasteris


Sabine Bruckert


Jocelyn Désy


Hélène Messier


122



---



##### Table of Contents





Albert J. Rahm, II


Board Committees






| |                
| | ---------------
| | Audit Committee





| |                     
| | --------------------
| | Nominating Committee





| |                               
| | ------------------------------
| | Corporate Governance Committee



123



---



##### Table of Contents







| |                       
| | ----------------------
| | Compensation Committee



Director Compensation






Election of Directors




Executive Compensation




124



---



##### Table of Contents





| |                                                                 
| | ----------------------------------------------------------------
| | Summary Compensation Table for the year ended
    March 26, 2005



|                            |                                                       |                     |         |              |         |  |            |              |  |  |              |           |  |  |       |  | 
|--------------------------- | ----------------------------------------------------- | ------------------- | ------- | ------------ | ------- |  | ---------- | ------------ |  |  | ------------ | --------- |  |  | ----- |  | 
|                            |                                                       | Annual Compensation |         |              | Awards  | 
|                            |                                                       |                     |         |              |         | 
|                            |                                                       |                     |         | Securities   |        
|                            |                                                       |                     |         | Other Annual |         |  | Underlying |             
|                            |                                                       | Salary              |         |              | Bonus   |  |            | Compensation |  |  | Options/SARs |          
|Name and Principal Position |                                                       | ($)                 |         |              | ($)(10) |  |            | ($)          |  |  | (#)          |          
|                            |                                                       |                     |         |              |         |  |            |              |  |  |              |          
|Thomas A. Andruskevich      |                                                       |                     | 864,000 | (1)          |         |  | 882,976    | (2)          |  |  | 28,760       | (3)(4)(5) |  |  |      | 
|                            | President, Chief Executive Officer
    and Director   |                     |         |              |         |  |            |              |  |  |              |           |  |  |       |  | 
|John D. Ball(5)(6)          |                                                       |                     | 179,400 |              |         |  | 35,790     | (2)          |  |  | 10,834       | (7)       |  |  |      | 
|                            | Senior Vice President and
    Chief Financial Officer |                     |         |              |         |  |            |              |  |  |              |           |  |  |       |  | 
|Marco I. Pasteris(5)        |                                                       |                     | 153,075 |              |         |  | 47,118     | (2)          |  |  | 8,310        | (8)       |  |  | 5,000 | 
|                            | Group Vice President for Finance                      |                     |         |              |         |  |            |              |  |  |              |           |  |  |       |  | 
|Albert J. Rahm, II          |                                                       |                     | 196,539 | (1)          |         |  | 104,794    | (2)          |  |  | 17,252       | (9)       |  |  |      | 
|                            | Vice President, Retail Store Operations               |                     |         |              |         |  |            |              |  |  |              |           |  |  |       |  | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Includes amounts paid by Mayors. (Mr. Andruskevich
    $500,000; Mr. Rahm $196,539).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   
|(2) | Includes amounts paid by Mayors. (Mr. Andruskevich
    $366,742; Mr. Pasteris $31,557; Mr. Rahm $73,894).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|(3) | Includes amounts paid for life insurance, financial services and
    retirement benefit contributions. Mr. Andruskevich also
    receives non-taxable benefits including reimbursement for club
    memberships used for business purposes, a contribution for
    long-term disability benefits, reimbursement for an annual
    medical checkup and a contribution for medical, dental and life
    insurance.                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   
|(4) | Mr. Andruskevich resides in New Jersey but spends a
    significant amount of time working in Montreal, Canada and
    Sunrise, Florida in his capacity as President and Chief
    Executive Officer of Birks and Mayors, respectively.
    Instead of reimbursing Mr. Andruskevich for hotel
    accommodation and car rental service in Montreal and Sunrise,
    Birks provides Mr. Andruskevich with the non-exclusive use
    of an apartment and an automobile in each location. The
    apartments and automobiles are made available to and utilized by
    other employees, customers and suppliers of Birks. Birks does
    not account for these expenses as compensation and Birks has
    been advised that they are not taxable as benefits to
    Mr. Andruskevich. Accordingly, the value of these items is
    not included in the table above.



| |     |                                                                                                                                                                                                                                                                                
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (5) | Includes amounts paid by Birks in Canadian dollars and converted
    to U.S. dollars at the average of the inverse of the noon
    buying rate quoted by the Federal Reserve Bank of New York for
    Canadian dollars during fiscal 2004, which was Cdn$1.00 per
    $0.78.   
|
| | (6) | John D. Ball resigned from his position at Mayors in
    December 2004 and from his position at Birks in February 2005
    but continued to be employed by each company until May 2005.                                                                                       
|
| | (7) | Includes amounts paid for car leasing, group benefit plan at
    Birks and life insurance. Mr. Ball also received
    reimbursement for car maintenance, repairs, insurance and
    license and non-taxable benefits including reimbursement for an
    annual medical checkup.
|
| | (8) | Includes amounts paid for car leasing and group benefit plan at
    Birks. Mr. Pasteris also receives reimbursement for car
    maintenance, repairs, insurance and license non-taxable benefits
    including reimbursement for an annual medical checkup.                    
|
| | (9) | Includes amounts paid for a car allowance and for miscellaneous
    retirement benefits. Mr. Rahm also receives non-taxable
    benefits including a contribution for medical, dental, life and
    disability insurance.                                                      



|     |                                                                                             
|---- | --------------------------------------------------------------------------------------------
|(10) | This corresponds to the bonus earned during the year ended
    March 26, 2005, but not paid.

125



---



##### Table of Contents





| |                                                                                      
| | -------------------------------------------------------------------------------------
| | Option Grants for Birks Class A voting shares in
    Fiscal Year Ended March 26, 2005

|                           |  |               |                |           |                 |  |               |         |  |  |                |  |  |   |      | 
|-------------------------- |  | ------------- | -------------- | --------- | --------------- |  | ------------- | ------- |  |  | -------------- |  |  | - | ---- | 
|                           |  |               |                | Number of |                 |  | Total Options |         |  | 
|Name                       |  | Date of Grant |                |           | Vesting Periods |  |               | Granted |  |  | Exercise Price | 
|                           |  |               |                |           |                 |  |               |         |  |  |                | 
|Sabine Bruckert            |  |               | April 23, 2004 |           |                 |  | 4             |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Helene Messier             |  |               | April 23, 2004 |           |                 |  | 4             |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Marco Pasteris             |  |               | April 23, 2004 |           |                 |  | 4             |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Shirley Dawe(1)            |  |               | April 23, 2004 |           |                 |  |              |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Margherita Oberti          |  |               | April 23, 2004 |           |                 |  |              |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Peter OBrien              |  |               | April 23, 2004 |           |                 |  |              |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Lorenzo Rossi di Montelera |  |               | April 23, 2004 |           |                 |  |              |         |  |  | 5,000          |  |  | $ | 7.73 | 
|Randolph Dirth             |  |               | July 1, 2004   |           |                 |  | 4             |         |  |  | 10,000         |  |  | $ | 7.73 | 






|    |                                                                                                                                                                                                                                
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | On July 9, 2005, Ms. Dawe relinquished the 5,000
    options and received as consideration a cash payment in respect
    of directors fees (Cdn$15,000) and committee fees
    (Cdn$4,000) for the year ending March 26, 2005.



| |                                                                    
| | -------------------------------------------------------------------
| | Option Exercises in Last Fiscal Year and Year-End Option
    Values



Aggregated Option Exercises in Fiscal Year Ended
March 26, 2005 and Fiscal


Year-End Option Values


|                           |  |             |   |  |          |                        |                  |                 |  |  |               |  |  |  |       | 
|-------------------------- |  | ----------- | - |  | -------- | ---------------------- | ---------------- | --------------- |  |  | ------------- |  |  |  | ----- | 
|                           |  |             |   |  |          | Number of Securities   |                 
|                           |  |             |   |  |          | Underlying Unexercised |                 
|                           |  | Shares      |   |  |          |                        | Birks Options at |                
|                           |  | Acquired on |   |  | Value    |                        |                  | Fiscal Year-End | 
|                           |  | Exercise    |   |  | Realized |                        |                  |                 | 
|Name                       |  | (#)         |   |  | ($)      |                        |                  | Exercisable     |  |  | Unexercisable | 
|                           |  |             |   |  |          |                        |                  |                 |  |  |               | 
|Thomas A. Andruskevich     |  |             |  |  |          |                        |                 |                 |  |  | 439,532       |  |  |  |      | 
|John D. Ball               |  |             |  |  |          |                        |                 |                 |  |  | 20,570        |  |  |  |      | 
|Marco I. Pasteris          |  |             |  |  |          |                        |                 |                 |  |  | 9,970         |  |  |  | 7,000 | 
|Al Rahm                    |  |             |  |  |          |                        |                 |                 |  |  |              |  |  |  |      | 
|Shirley Dawe(1)            |  |             |  |  |          |                        |                 |                 |  |  | 5,000         |  |  |  |      | 
|Peter OBrien              |  |             |  |  |          |                        |                 |                 |  |  | 5,000         |  |  |  |      | 
|Lorenzo Rossi di Montelera |  |             |  |  |          |                        |                 |                 |  |  | 5,000         |  |  |  |      | 
|Margherita Oberti          |  |             |  |  |          |                        |                 |                 |  |  | 5,000         |  |  |  |      | 






|    |                                                                                                                                                                                                                                
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | On July 9, 2005, Ms. Dawe relinquished the 5,000
    options and received as consideration a cash payment in respect
    of directors fees (Cdn$15,000) and committee fees
    (Cdn$4,000) for the year ending March 26, 2005.

Equity Incentive Plans




| |                                  
| | ---------------------------------
| | Birks Employee Stock Option Plan



Plan administration.


126



---



##### Table of Contents



Eligibility.


Option to acquire share under the ESOP.




Option Period and Vesting Criteria.


Material Event.


Exercise and Payment.


Adherence to shareholders agreement.


Rights not transferable.


Reorganization of share capital.


127



---



##### Table of Contents





Interpretation and Amendment.


Termination.


Various.




|                                                   |  |                      |         |  |                      |      |                      |                          |  |  |        | 
|-------------------------------------------------- |  | -------------------- | ------- |  | -------------------- | ---- | -------------------- | ------------------------ |  |  | ------ | 
|                                                   |  |                      |         |  |                      | (C)  |                     
|                                                   |  | (A)                  |         |  |                      |      | Number of Securities |                         
|                                                   |  | Number of Securities |         |  | (B)                  |      |                      | Remaining Available for  | 
|                                                   |  | to be Issued Upon    |         |  | Weighted-Average     |      |                      | Issuance Under Equity    | 
|                                                   |  | Exercise of          |         |  | Exercise Price of    |      |                      | Compensation Plans       | 
|                                                   |  | Outstanding Options, |         |  | Outstanding Options, |      |                      | (Excluding Securities    | 
|Plan Category                                      |  | Warrants and Rights  |         |  | Warrants and Rights  |      |                      | Reflected in Column (A)) | 
|                                                   |  |                      |         |  |                      |      |                      |                          | 
|Equity Compensation plans approved by shareholders |  |                      | 180,419 |  |                      | Cdn$ | 6.70                 |                          |  |  | 57,488 | 
|Other equity compensation agreements               |  |                      | 724,907 |  |                      | Cdn$ | 5.64                 |                          |  |  |       | 
|                                                   |  |                      |         |  |                      |      |                      |                          | 
|Total                                              |  |                      | 905,326 |  |                      | Cdn$ | 5.85                 |                          |  |  | 57,488 | 
|                                                   |  |                      |         |  |                      |      |                      |                          | 



| |                               
| | ------------------------------
| | Mayors Equity-Incentive Plans



Long-Term Incentive Plan




Plan Administration.




| |   |                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------
| |  | construe and interpret the Long-Term Incentive Plan and the
    awards made under the Long-Term Incentive Plan,
|
| |  | make rules and regulations relating to the administration of the
    Long-Term Incentive Plan,                 
|
| |  | select grantees and make awards, and                                                                           
|
| |  | establish the terms and conditions of grants and awards.                                                       

128



---



##### Table of Contents



Eligibility.


Awards.


Shares Subject to the Long-Term Incentive Plan.




Adjustments.


Options.






SARS.




Restricted Stock.


129



---



##### Table of Contents





Performance Awards.




Change in Control.








| |   |                                                                                                                                                                                                                                                                                                                   
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Provide that all outstanding awards upon the consummation of
    such a merger or sale shall be assumed by, or an equivalent
    option or right shall be substituted by, the successor
    corporation or parent or subsidiary of such successor
    corporation.                                                
|
| |  | Prior to the occurrence of the change in control, provide that
    all outstanding awards to the extent they are exercisable and
    vested shall be terminated in exchange for a cash payment equal
    to the change in control price; or                                                                       
|
| |  | Prior to the occurrence of the change in control, provide for
    the grantee to have the right to exercise the award as to all or
    a portion of the covered stock, including, if so determined by
    the administrator, in its sole discretion, shares as to which it
    would not otherwise be exercisable.

Employee Stock Purchase Plan




1987 and 1991 Stock Option Plans




130



---



##### Table of Contents





Employment Agreements




| |                       
| | ----------------------
| | Thomas A. Andruskevich





131



---



##### Table of Contents













132



---



##### Table of Contents








| |                    
| | -------------------
| | Michael Rabinovitch














| |                   
| | ------------------
| | Albert J. Rahm, II






Compensation Committee Interlocks and Insider
Participation







133



---



##### Table of Contents






CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS OF
BIRKS


Diamond Supply Agreements






Management Fee Agreement




Management Consulting Agreement




Shareholders Agreements




134



---



##### Table of Contents





Arrangements with Directors








Separation Agreement






135



---



##### Table of Contents







Convertible Notes






Registration Rights Agreement




Loans from Regaluxe






Letter of Credit from Regaluxe




136



---



##### Table of Contents






OWNERSHIP OF BIRKS CLASS A VOTING SHARES






| |   |                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------
| |  | each person or entity who beneficially owns 5% or more of
    Birks outstanding Class A voting shares;
|
| |  | each of Birks directors and executive officers; and                                                   
|
| |  | all of Birks directors and executive officers as a group.                                             








|                                                                 |  |                   |           |  |                  |  |           |              |  |  |               |  |  |  |      |  
|---------------------------------------------------------------- |  | ----------------- | --------- |  | ---------------- |  | --------- | ------------ |  |  | ------------- |  |  |  | ---- | -
|                                                                 |  | Before the Merger |           |  | After the Merger | 
|                                                                 |  |                   |           |  |                  | 
|                                                                 |  | Number of         |           |  |                  |  | Number of |              |  | 
|                                                                 |  | Shares            |           |  | Percentage of    |  |           | Shares       |  |  | Percentage of | 
|Name and Address(1) of                                           |  | Beneficially      |           |  | Beneficially     |  |           | Beneficially |  |  | Beneficially  | 
|Beneficial Owner(2)                                              |  | Owned             |           |  | Owned            |  |           | Owned        |  |  | Owned         | 
|                                                                 |  |                   |           |  |                  |  |           |              |  |  |               | 
|Dr. Lorenzo Rossi di Montelera(3)                                |  |                   | 8,475,123 |  |                  |  | 99.0      | %            |  |  | 8,227,846     |  |  |  | 70.3 | %
|Thomas A. Andruskevich(4)                                        |  |                   | 479,998   |  |                  |  | 91.4      | %            |  |  | 779,954       |  |  |  | 18.5 | %
|Shirley A. Dawe(5)                                               |  |                   | 5,000     |  |                  |  | 5.5       | %            |  |  | 870           |  |  |  | *    |  
|Margherita Oberti(6)                                             |  |                   | 5,000     |  |                  |  | 5.5       | %            |  |  | 5,000         |  |  |  | *    |  
|Peter R. OBrien(7)                                              |  |                   | 7,529     |  |                  |  | 8.3       | %            |  |  | 7,529         |  |  |  | *    |  
|Filippo Recami(8)                                                |  |                   | 126,672   |  |                  |  | 59.7      | %            |  |  | 126,672       |  |  |  | 3.5  | %
|Lawrence Litowitz                                                |  |                   |          |  |                  |  |          |              |  |  |              |  |  |  |     |  
|Sabine Bruckert(9)                                               |  |                   | 14,780    |  |                  |  | 15.0      | %            |  |  | 14,780        |  |  |  | *    |  
|Albert J. Rahm II                                                |  |                   |          |  |                  |  |          |              |  |  |              |  |  |  |     |  
|Marco I. Pasteris(10)                                            |  |                   | 42,693    |  |                  |  | 39.6      | %            |  |  | 97,153        |  |  |  | 2.8  | %
|Carlo Coda-Nunziante(11)                                         |  |                   |          |  |                  |  |          |              |  |  | 40,955        |  |  |  | 1.2  | %
|Randolph Dirth(12)                                               |  |                   | 2,500     |  |                  |  | 2.8       | %            |  |  | 24,238        |  |  |  | *    |  
|John C. Orrico(13)                                               |  |                   |          |  |                  |  |          |              |  |  | 1,449         |  |  |  | *    |  
|Hélène Messier(14)                                               |  |                   | 8,250     |  |                  |  | 8.8       | %            |  |  | 8,250         |  |  |  | *    |  
|Jocelyn Désy                                                     |  |                   |          |  |                  |  |          |              |  |  |              |  |  |  |     |  
|All executive officers and directors as a Group (15 persons)(15) |  |                   | 8,415,192 |  |                  |  | 99.8      | %            |  |  | 8,836,367     |  |  |  | 72.1 | %




137



---



##### Table of Contents






|                             |                                                                               |                   |           |  |                  |  |           |              |  |  |               |  |  |  |      |   | 
|---------------------------- | ----------------------------------------------------------------------------- | ----------------- | --------- |  | ---------------- |  | --------- | ------------ |  |  | ------------- |  |  |  | ---- | - | 
|                             |                                                                               | Before the Merger |           |  | After the Merger | 
|                             |                                                                               |                   |           |  |                  | 
|                             |                                                                               | Number of         |           |  |                  |  | Number of |              |  | 
|                             |                                                                               | Shares            |           |  | Percentage of    |  |           | Shares       |  |  | Percentage of | 
|Name and Address(1) of       |                                                                               | Beneficially      |           |  | Beneficially     |  |           | Beneficially |  |  | Beneficially  | 
|Beneficial Owner(2)          |                                                                               | Owned             |           |  | Owned            |  |           | Owned        |  |  | Owned         | 
|                             |                                                                               |                   |           |  |                  |  |           |              |  |  |               | 
|5% Shareholders:             |                                                                               |                   |           |  |                  |  |           |              |  |  |               |  |  |  |      |  
|Regaluxe Investments Sarl(3) |                                                                               |                   | 8,475,123 |  |                  |  | 99.0      | %            |  |  | 8,227,846     |  |  |  | 70.3 | %
|                             | 25 A. Boulevard Royal
    2449 Luxembourg                                     |                   |           |  |                  |  |           |              |  |  |               |  |  |  |      |   | 
|Prime Investments SA(16)     |                                                                               |                   | 1,536,047 |  |                  |  | 94.7      | %            |  |  | 1,536,047     |  |  |  | 30.6 | %
|                             | Saphine Building 1st Floor
    63 Boulevard Prince Félix
    L1513-Luxembourg |                   |           |  |                  |  |           |              |  |  |               |  |  |  |      |   | 









| |   |                    
| | - | -------------------
| | * | Less than 1 percent



| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Unless otherwise provided, the address for each Beneficial
    Owner is 1240 Square Phillips, Montreal, Quebec, Canada,
    H3B 3H4.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | (2) | Unless otherwise noted, each person has sole voting and
    investment power over the shares listed opposite his or her name.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
|
| | (3) | Includes options to purchase (A) 5,000 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days, (B) 752,153 Birks Class A voting
    shares or options owned by members of Birks management that such
    management agreed to vote with Dr. Rossi,
    (C) 7,213,094 Birks Class A voting shares to which
    Regaluxe would be entitled upon conversion of the Class B
    multiple voting shares held by Regaluxe and its affiliates and
    (D) 504,876 Birks Class A voting shares to which
    Regaluxe would be entitled upon conversion of a secured
    convertible note held by Regaluxe and its affiliates into
    Class B multiple voting shares and the subsequent
    conversion into Class A voting shares. After the merger
    amount reflects termination of managements agreement to
    vote its shares with Dr. Rossi upon consummation of the
    merger. Dr. Rossi exercises voting and investment control
    over the securities held of record by Regaluxe and its
    affiliates.
|
|
| | (4) | Includes options to purchase 439,532 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days and 40,466 Birks Class A voting shares.
    After the merger the amount additionally includes 262,962 Birks
    Class A voting shares underlying options and warrants that
    will be converted from options and warrants to purchase
    Mayors common stock into options and warrants to purchase
    Birks Class A voting shares upon consummation of the merger
    and an additional 37,194 Birks Class A voting shares that
    will underlie Mr. Andruskevichs option to
    purchase 2% of the common stock of Birks as a result of the
    issuance of additional Class A voting shares pursuant to
    the merger.                                                                                                                                                                                                                                                                                  
|
| | (5) | Includes options to purchase 5,000 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (6) | Includes options to purchase 5,000 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days. After the merger amount includes 870 Birks
    Class A voting shares underlying options that will be
    covered from options to purchase Mayors common stock into
    options to purchase Birks Class A voting shares upon
    consummation of the merger.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (7) | Includes options to purchase 5,000 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (8) | Includes options to purchase 126,672 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | (9) | Includes options to purchase 13,095 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  



|     |                                                                                                                                                                                                                                                                                                                               
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | Includes options to purchase 12,220 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days and 10,240 Birks Class A voting shares
    issuable upon conversion of Series A preferred shares.
    After the merger amount includes 56,878 Birks Class A
    voting shares underlying

138



---



##### Table of Contents



| |                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | options and warrants that will be converted from options and
    warrants to purchase Mayors common stock into options and
    warrants to purchase Birks Class A voting shares upon
    consummation of the merger.



|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(11) | After the merger amount includes 40,955 Birks Class A
    voting shares underlying options and warrants that will be
    converted from options and warrants to purchase Mayors
    common stock into options and warrants to purchase Birks
    Class A voting shares upon consummation of the merger.                                                                                                                                                                                       
|    
|(12) | Includes options to purchase 2,500 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days. After the merger amount includes 21,738
    Birks Class A voting shares that will result from the
    conversion of 250,000 shares of Mayors common stock
    into Birks Class A voting shares upon consummation of the
    merger.                                                                                                                     
|    
|(13) | After the merger amount includes 1,449 Birks Class A voting
    shares underlying options and warrants that will be converted
    from options and warrants to purchase Mayors common stock
    into options and warrants to purchase Birks Class A voting
    shares upon consummation of the merger.                                                                                                                                                                                        
|    
|(14) | Includes options to purchase 8,250 Birks Class A
    voting shares which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                          
|    
|(15) | Includes 674,030 Birks Class A voting shares issuable upon
    the exercise of stock options for all executive officers and
    directors.                                                                                                                                                                                                                                                                                                                                                     
|    
|    
|(16) | Includes 1,024,032 Birks Class A voting shares issuable
    upon conversion of Series A preferred shares and 512,015
    Birks Class A voting shares issuable upon conversion of a
    secured convertible note held by Prime Investments SA. Birks has
    been advised that Deutsche Bank International Trust Co. Limited,
    as Trustee of Pine Trust and The Beech Settlement, exercises
    voting and investment control over the securities held of record
    by Prime Investments SA.
|    

139



---



##### Table of Contents






DESCRIPTION OF BIRKS CAPITAL STOCK


Birks Current Capital Stock






| |   |                                                                                        
| | - | ---------------------------------------------------------------------------------------
| |  | An unlimited number of Class A voting shares without
    nominal or par value;         
|
| |  | An unlimited number of Class B multiple voting shares
    without nominal or par value;
|
| |  | 100,000 Class C multiple voting shares without nominal or
    par value;               
|
| |  | An unlimited number of non-voting common shares; and                                   
|
| |  | 2,034,578 Series A preferred shares.                                                   











140



---



##### Table of Contents



Birks Capital Stock Upon Consummation of the Merger






| |   |                                                                                              
| | - | ---------------------------------------------------------------------------------------------
| |  | An unlimited number of Class A voting shares without
    nominal or par value;               
|
| |  | An unlimited number of Class B multiple voting shares
    without nominal or par value; and  
|
| |  | An unlimited number of preferred shares without nominal or par
    value, issuable in series.



The Class A voting shares will have attached thereto the
following rights, privileges, restrictions and conditions:




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Voting. Each Class A voting share will entitle the
    holder thereof to one (1) vote at all meetings of the
    shareholders of Birks (except meetings at which only holders of
    another specified class of shares are entitled to vote pursuant
    to the provisions of Birks amended charter or the CBCA).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | Ranking on Liquidation. In the event of the liquidation,
    dissolution or winding-up of Birks, whether voluntary or
    involuntary, or other distribution of assets of Birks among
    shareholders for the purpose of winding-up its affairs, subject
    to the rights, privileges, restrictions and conditions attaching
    to any other class of shares ranking prior to the Class A
    voting shares or the Class B multiple voting shares, the
    holders of the Class A voting shares and the holders of the
    Class B multiple voting shares will be entitled to receive
    the remaining property of Birks. The holders of the Class A
    voting shares and the holders of the Class B multiple
    voting shares will rank equally with respect to the distribution
    of assets in the event of the liquidation, dissolution or
    winding-up of Birks, whether voluntary or involuntary, or any
    other distribution of the assets of Birks among shareholders for
    the purpose of winding-up its affairs.
|
| |  | Dividends and Distributions. In addition to any dividend
    or distribution declared by the directors of Birks in respect of
    Class A voting shares, holders of Class A voting
    shares will be entitled to receive a dividend or distribution,
    whether cash, non-cash or some combination thereof, equal (on a
    per share basis) to any dividend or distribution declared by the
    directors of Birks in respect of the Class B multiple
    voting shares. Dividends and distributions on Class A
    voting shares will be payable on the date fixed for payment of
    the dividend or distribution in respect of Class A voting
    shares or, if applicable, on the date fixed for payment of any
    dividend or distribution in respect of Class B multiple
    voting shares.                                                                                                                                                                                                                                  
|
| |  | Right of Participation in a Sale Transaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | No holder of Class B multiple voting shares or group of
    holders of Class B multiple voting shares that are
    Affiliates (each a Controlling Holder and together
    the Controlling Holders) will sell, transfer or
    otherwise dispose of Class B multiple voting shares if,
    immediately following such sale, transfer or disposition of
    Class B multiple voting shares, such Controlling Holders
    shall control less than a majority of the total voting rights
    attached to the common shares issued and outstanding on the date
    of such sale, transfer or disposition (a Sale
    Transaction), unless all other holders of common shares
    will have the right (A) to receive the same consideration
    (on a per share basis), whether cash, non-cash or some
    combination thereof, as that to be received by the Controlling
    Holders pursuant to the Sale Transaction and (B) to
    participate in such Sale Transaction on the same terms as the
    Controlling Holders in all other material respects, including in
    respect of the conditions to such Sale Transaction. Written
    notice of any Sale Transaction, which notice will specify the
    terms of such Sale Transaction and the right of all holders of
    common shares to participate in such Sale Transaction, will be
    provided to the holders of common shares by first class mail, at
    least twenty (20) business days prior to the consummation
    of such Sale Transaction.
|
| |  | Any Sale Transaction not in compliance with the paragraph above
    will be null and void and will not be registered in the books of
    Birks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

141



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Notwithstanding the foregoing, none of the following shall
    constitute a Sale Transaction: (A) any pledge, mortgage,
    hypothecation, lien or similar encumbrance, whether by
    possession or registration, of Class B multiple voting
    shares which creates a security interest in favor of another
    person or entity, and (B) any sale, transfer or other
    disposition of Class B multiple voting shares to
    Affiliates, Associates or shareholders of the transferor of such
    Class B multiple voting shares. For purposes of this
    section, an Affiliate means a person that directly
    or indirectly through one or more intermediaries, controls, is
    controlled by, or is under common control with, such specified
    person. For purposes of this section, an Associate,
    when used to indicate a relationship with any person, means
    (x) any trust or other estate in which such person has a
    substantial beneficial interest or as to which such person
    serves as trustee or in a similar fiduciary capacity and
    (y) a spouse or child of such person.



| |   |                                                  
| | - | -------------------------------------------------
| |  | Right of Participation in a Business Combination.



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Birks will not consummate a Business Combination unless the
    holders of Class A voting shares will have the right
    (A) to receive the same consideration (on a per share
    basis), whether cash, non-cash or some combination thereof, as
    that to be received by the holders of Class B multiple
    voting shares in connection with such Business Combination and
    (B) to participate in such Business Combination on the same
    terms as the holders of Class B multiple voting shares in
    all other material respects, including in respect of the
    conditions to such Business Combination.                                                                                                                                                        
|
| |  | Business Combination as used herein will mean,
    whether in one or a series of related transactions: (A) any
    merger, amalgamation, recapitalization or consolidation
    involving Birks, other than a merger, amalgamation,
    recapitalization, consolidation or similar transaction with a
    wholly-owned subsidiary of Birks or which is solely for the
    purpose of continuance of Birks as a corporation in another
    jurisdiction; (B) any sale, lease, exchange, transfer or
    other disposition involving 50% or more of the assets of Birks
    and its subsidiaries, on a consolidated basis; or (C) any
    agreement, contract or other arrangement having the same purpose
    or effect as the transactions described in (A) and
    (B) above.



| |   |                                                    
| | - | ---------------------------------------------------
| |  | Transactions or Actions Requiring Special Approval.



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | In addition to any other approvals required under the CBCA,
    prior to consummating a Related Party Transaction, Birks will
    obtain (A) the consent of the majority of a committee of
    independent directors of Birks and (B) with respect to
    clauses (x) and (y) of the definition of Related
    Party Transaction below, the affirmative vote in favor of the
    approval of the Related Party Transaction by the majority of the
    holders of Class A voting shares (exclusive of Class A
    voting shares held by the Related Person (and its Affiliates and
    Associates) which is or would be a party to such Related Party
    Transaction) that cast a vote, in person or by proxy (but not
    including any vote that is not counted as either an affirmative
    or negative vote), at the annual or special shareholders meeting
    at which such Related Party Transaction is considered.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| |  | For purposes of this section, (A) Related Party
    Transaction will mean (x) consummation of a Business
    Combination with a Related Person; (y) amending, repealing
    or altering in anyway any provision of the amended charter or
    the amended by-laws of Birks, except for matters not having an
    adverse effect on the holders of Class A voting shares; or
    (z) the issuance, sale, exchange, transfer or other
    disposition (in one transaction or a series of related
    transactions) by Birks or any wholly-owned subsidiary of Birks
    of any securities of Birks or of such subsidiary to a Related
    Person (other than pursuant to: an employee or director stock
    incentive plan or other compensation arrangements approved by
    the compensation committee of Birks; an offering made to all
    holders of Class A voting shares; or a public offering);
    and (B) Related Person will mean any individual,
    corporation, partnership, group, association or other person or
    entity that, together with its Affiliates and Associates,
    beneficially owns Class A voting shares and/or Class B
    multiple voting shares which, in the aggregate, represent twenty
    percent (20%) or more of the total voting rights attached to the
    common shares issued and outstanding at the time the definitive
    agreement with respect to a Related Party Transaction is
    executed.

142



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Subdivision, Consolidation, Reclassification or Other
    Change. No subdivision, consolidation or reclassification
    of, or other change to, the Class A voting shares will be
    carried out, either directly or indirectly unless, at the same
    time, the Class B multiple voting shares are subdivided,
    consolidated, reclassified or changed in the same manner and on
    the same basis.                                                                                                                                                                                                                                                                                                                             
|
| |  | Equal Status. Except as otherwise expressly provided in
    Birks amended charter, Class A voting shares and
    Class B multiple voting shares will have the same rights
    and privileges and will rank equally, share ratably and be equal
    in all respects as to all matters.                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| |  | Approval of Issuance. For so long as the outstanding
    Class B multiple voting shares represent a majority of the
    total voting rights attached to the common shares,Birks
    shall not issue any Class A voting shares, or any security
    convertible into or exercisable or exchangeable for Class A
    voting shares, unless such issuance, or the plan or agreement
    under which such security is to be issued, has been approved by
    (i) a majority of the votes cast at a meeting of the
    holders of Class B multiple voting shares or
    (ii) unanimous written consent of the holders of
    Class B multiple voting shares; provided, however,
    such approval shall not be required for the issuance of



| |   |                                                                                                                                                                                                                                                                                                 
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Class A voting shares, options or warrants under any plan
    or agreement approved by Birks prior to June 1, 2005,
    including without limitation, the merger agreement; or                                                                                                                  
|
| |  | Class A voting shares upon the exercise of an option or
    warrant issued or to be issued under any plan or agreement
    approved by Birks prior to June 1, 2005; or                                                                                                                          
|
| |  | Class A voting shares upon the conversion of Class B
    multiple voting shares; or                                                                                                                                                                                                             
|
| |  | Class A voting shares upon the conversion, exercise or
    exchange of any security, obligation or other instrument of
    Birks for Class A voting shares if the issuance of such
    security, obligation or other instrument of Birks was previously
    approved pursuant to this paragraph.

The Class B multiple voting shares will have attached
thereto the following rights, privileges, restrictions and
conditions:




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Voting. Each Class B multiple voting share will
    entitle the holder thereof to ten (10) votes at all
    meetings of the shareholders of Birks (except meetings at which
    only holders of another specified class of shares are entitled
    to vote pursuant to the provisions of Birks amended
    charter or the CBCA).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |  | Ranking on Liquidation. In the event of the liquidation,
    dissolution or winding-up of Birks, whether voluntary or
    involuntary, or other distribution of assets of Birks among
    shareholders for the purpose of winding-up its affairs, subject
    to the rights, privileges, restrictions and conditions attaching
    to any other class of shares ranking prior to the Class B
    multiple voting shares or the Class A voting shares, the
    holders of the Class B multiple voting shares and the
    holders of the Class A voting shares will be entitled to
    receive the remaining property of Birks. The holders of the
    Class B multiple voting shares and the holders of the
    Class A voting shares will rank equally with respect to the
    distribution of assets in the event of the liquidation,
    dissolution or winding-up of Birks, whether voluntary or
    involuntary, or any other distribution of the assets of Birks
    among shareholders for the purpose of winding-up its affairs.
|
| |  | Dividends and Distributions. In addition to any dividend
    or distribution declared by the directors in respect of
    Class B multiple voting shares, holders of Class B
    multiple voting shares will be entitled to receive a dividend or
    distribution, whether cash, non-cash or some combination
    thereof, equal (on a per share basis) to any dividend or
    distribution declared by the directors of Birks in respect of
    Class A voting shares. Dividends and distributions on
    Class B multiple voting shares will be payable on the dated
    fixed for payment of the dividend or distribution in respect of
    Class B multiple voting shares or, if applicable, on the
    date fixed for payment of a dividend or distribution in respect
    of Class A voting shares.                                                                                                                                                                                                                              

143



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                          
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Conversion by Holder into Class A voting shares.
    Each Class B multiple voting share may at any time and from
    time to time, at the option of the holder, be converted into one
    (1) fully paid and non-assessable Class A voting
    share. Such conversion right will be exercised as follows:



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the holder of Class B multiple voting shares will send to
    the transfer agent of Birks a written notice, accompanied by a
    certificate or certificates representing the Class B
    multiple voting shares in respect of which the holder desires to
    exercise such conversion right. Such notice will be signed by
    the holder of the Class B multiple voting shares in respect
    of which such right is being exercised, or by the duly
    authorized representative thereof, and will specify the number
    of Class B multiple voting shares which such holder desires
    to have converted. The holder will also pay any governmental or
    other tax, if any, imposed in respect of such conversion. The
    conversion of the Class B multiple voting shares into
    Class A voting shares will take effect upon receipt by the
    transfer agent of Birks of the conversion notice accompanied by
    the certificate or certificates representing the Class B
    multiple voting shares in respect of which the holder desires to
    exercise such conversion right.
|
| |  | upon receipt of such notice and certificate or certificates by
    the transfer agent of Birks, Birks will, effective as of the
    date of such receipt, issue or cause to be issued a certificate
    or certificates representing Class A voting shares into
    which Class B multiple voting shares are being converted.
    If less than all of the Class B multiple voting shares
    represented by any certificate are to be converted, the holder
    will be entitled to receive a new certificate representing the
    Class B multiple voting shares represented by the original
    certificate which are not to be converted.                                                                                                                                                                                                                                                                                                                                                                                                                                                       



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Subdivision, Consolidation, Reclassification or Other
    Change. No subdivision, consolidation or reclassification
    of, or other change to, the Class B multiple voting shares
    will be carried out unless, at the same time, the Class A
    voting shares are subdivided, consolidated, reclassified or
    changed in the same manner and on the same basis.                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | Equal Status. Except as otherwise expressly provided in
    Birks amended charter, Class B multiple voting shares
    and Class A voting shares will have the same rights and
    privileges and will rank equally, share ratably and be equal in
    all respects as to all matters.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | Approval of Issuance. For so long as the outstanding
    Class B multiple voting shares represent a majority of the
    total voting rights attached to the common shares, Birks shall
    not issue any Class B multiple voting shares, or any
    security convertible into or exercisable or exchangeable for
    Class B multiple voting shares, unless such issuance has
    been approved by a majority of the votes cast at a meeting of
    the holders of Class B multiple voting shares; provided,
    however, such approval shall not be required for the
    issuance of Class B multiple voting shares upon the
    conversion, exercise or exchange of any security of Birks for
    Class B multiple voting shares if the issuance of such
    security of Birks was previously approved pursuant to this
    paragraph.

The preferred shares will have attached thereto, as a class,
the following rights, privileges, restrictions and
conditions:




| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Issuance of Preferred Shares, in Series. The directors of
    Birks may, at any time and from time to time, issue preferred
    shares in one (1) or more series, each series to consist of
    such number of preferred shares as may, before issuance thereof,
    be determined by the directors                                                                                                                                               
|
| |  | Determination of Rights, Privileges, Restrictions, Conditions
    and Limitations Attaching to Series of Preferred Shares. The
    directors of the Corporation may, subject to the following, from
    time to time fix, before issuance, the designation, rights,
    privileges, restrictions, conditions and limitations to attach
    to the preferred shares of each series including, without
    limiting the generality of the foregoing,



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | the rate, amount or method of calculation of preferential
    dividends of the preferred shares of such series, if any,
    whether cumulative or non-cumulative or partially cumulative,
    and whether such rate, amount or method of calculation shall be
    subject to change or adjustment in the future, the currency or
    currencies of payment, the date or dates and place or places of
    payment thereof and the date or dates from which such
    preferential dividends shall accrue; provided, that, the
    dividends payable with respect to any series of preferred
    shares, whether cumulative or non-cumulative or partially

144



---



##### Table of Contents



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   | cumulative, shall not exceed five (5) percent of the
    liquidation preference of such series of preferred shares;                                                                                                                                                                                                                                                                                                                                                                                         
|
| |  | the redemption price and terms and conditions of redemption, if
    any, of the preferred shares of such series; provided,
    that, without the approval by a majority of the votes cast
    at a meeting of shareholders of Birks duly called, the
    redemption price shall not exceed the liquidation preference of
    such shares;                                                                                                                                                                   
|
| |  | the rights of retraction, if any, vested in the holders of
    preferred shares of such series, and the prices and the other
    terms and conditions of any rights of retraction, and whether
    any additional rights of retraction may be vested in such
    holders in the future; provided, that, without the
    approval by a majority of the votes cast at a meeting of
    shareholders of Birks duly called, the retraction price shall
    not exceed the liquidation preference of such shares;
|
| |  | the voting rights, if any, of the preferred Shares of such
    series; provided, that, the approval by a majority of the
    votes cast at a meeting of shareholders of Birks duly called
    shall be required for the issuance of any series of preferred
    shares with voting rights;                                                                                                                                                                                                                  
|
| |  | the conversion rights and terms and conditions of conversion, if
    any, of the preferred shares of such series; provided,
    that, the approval by a majority of the votes cast at a
    meeting of shareholders of Birks duly called shall be required
    for the issuance of any series of preferred shares which are
    convertible into securities with voting rights;                                                                                                                             
|
| |  | any sinking fund, purchase fund or other provisions attaching to
    the preferred shares of such series; and                                                                                                                                                                                                                                                                                                                                                                                               
|
| |  | any other relative rights, preferences and limitations of the
    preferred shares of such series, the whole subject to the issue
    of a certificate of amendment in respect of articles of
    amendment in the prescribed form to designate a series of
    preferred shares.                                                                                                                                                                                                                           



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Cumulative Dividends or Return of Capital Not Paid in
    Full. Pursuant to section 27(2) of the CBCA, when any
    cumulative dividends or amounts payable on a return of capital
    in respect of a series of preferred shares are not paid in full,
    the preferred shares of all series will participate ratably in
    respect of such dividends including accumulations, if any, in
    accordance with the sums which would be payable on the preferred
    shares if all such dividends were declared and paid in full, and
    on any return of capital in accordance with the sums which would
    be payable on such return of capital if all sums so payable were
    paid in full.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| |  | Payment of Dividends and Other Preferences. The preferred
    shares will be entitled to preference over the Class A
    voting shares, the Class B multiple voting shares and any
    other shares of Birks ranking junior to the preferred shares
    with respect to the payment of dividends, and may also be given
    such other preferences over the Class A voting shares, the
    Class B multiple voting shares and any other shares of
    Birks ranking junior to the preferred shares, as may be fixed by
    the directors of Birks, as to the respective series authorized
    to be issued.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| |  | Procedure for Payment of Dividends. No dividends will at
    any time be declared or paid or set apart for payment on any
    shares of Birks ranking junior to the preferred shares, unless
    all dividends up to and including the dividends payable for the
    last completed period for which such dividends will be payable
    on each series of preferred shares then issued and outstanding
    will have been declared and paid or set apart for payment at the
    date of such declaration or payment or setting apart for payment
    on such shares of Birks ranking junior to the preferred shares,
    nor will Birks call for redemption or redeem or purchase for
    cancellation or reduce or otherwise pay off any of the preferred
    shares (less than the total amount then outstanding) or any
    shares of Birks ranking junior to the preferred shares, unless
    all dividends up to and including the dividend payable for the
    last completed period for which such dividends will be payable
    on each series of the preferred shares then issued and
    outstanding will have been declared and paid or set apart for
    payment at the date of such call for redemption, purchase,
    reduction or other payment.

145



---



##### Table of Contents





| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Ranking for Payment of Dividends and Liquidation, Dissolution
    or Winding-up. The preferred shares of each series will rank
    on a parity with the preferred shares of every other series with
    respect to priority in payment of dividends and in the
    distribution of assets in the event of liquidation, dissolution
    or winding-up of Birks whether voluntary of involuntary.                                                                                                                                                              
|
| |  | Liquidation, Dissolution or Winding-up. In the event of
    the liquidation, dissolution or winding-up of Birks or other
    distribution of assets of Birks among shareholders for the
    purpose of winding-up its affairs, the holders of the preferred
    shares will, before any amount will be paid to or any property
    or assets of Birks distributed among the holders of the
    Class A voting shares, the Class B multiple voting
    shares or any other shares of Birks ranking junior to the
    preferred shares, be entitled to receive:



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | an amount equal to the consideration received by Birks upon the
    issuance of such shares together with, in the case of cumulative
    preferred shares, all unpaid cumulative dividends (which for
    such purpose will be calculated as if such cumulative dividends
    were accruing from day to day for the period from the expiration
    of the last period for which cumulative dividends have been
    paid-up to and including the date of distribution) and, in the
    case of non-cumulative preferred shares, all declared and unpaid
    non-cumulative dividends; and
|
| |  | if such liquidation, dissolution, winding-up or distribution
    will be voluntary, an additional amount equal to the premium, if
    any, which would have been payable on the redemption of the said
    preferred shares respectively if they had been called for
    redemption by Birks on the date of distribution and, if said
    preferred shares could not be redeemed on such date, then an
    additional amount equal to the greatest premium, if any, which
    would have been payable on the redemption of said preferred
    shares respectively.                      



| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Purchase by Birks. The preferred shares of any series may
    be purchased for cancellation or made subject to redemption by
    Birks at such times and at such prices and upon such other terms
    and conditions as may be specified in the rights, privileges,
    restrictions and conditions attaching to the preferred shares of
    such series as set forth in the articles of amendment relating
    to such series.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| |  | Amendments. The provisions of this section relating to
    preferred shares may be deleted or varied in whole or in part by
    a certificate of amendment, but only with the prior approval of
    the holders of the preferred shares, given as hereinafter
    specified, in addition to any other approval required by the
    CBCA (or any other statutory provision of the like or similar
    effect, from time to time in force). The approval of the holders
    of the preferred shares with respect to any and all matters
    hereinbefore referred to, may be given by at least two-thirds
    (2/3)
    of the votes cast at a meeting of the holders of the preferred
    shares duly called for that purpose and held upon at least
    twenty-one (21) days notice at which the holders of a
    majority of the outstanding preferred shares are present or
    represented by proxy. If at any such meeting the holders of a
    majority of the outstanding preferred shares are not present or
    represented by proxy within thirty (30) minutes after the
    time appointed for such meeting, then the meeting will be
    adjourned to such date being not less than thirty (30) days
    later and to such time and place as may be determined by the
    chairman of the meeting and not less than twenty-one
    (21) days notice will be given of such adjourned meeting
    but it will not be necessary in such notice to specify the
    purpose for which the meeting was originally called. At such
    adjourned meeting the holders of preferred shares, present or
    represented by proxy, may transact the business for which the
    meeting was originally called and a resolution passed thereat by
    not less than two-thirds
    (2/3)
    of the votes cast at such adjourned meeting, will constitute the
    authorization of the holders of the preferred shares referred to
    above. The formalities to be observed in respect of the giving
    of notice of any such meeting or adjourned meeting and the
    conduct thereof will be those from time to time prescribed by
    the by-laws of Birks with respect to meetings of shareholders.
    On every poll taken at every such meeting or adjourned meeting,
    every holder of preferred shares will be entitled to one
    (1) vote in respect of each preferred share held.

146



---



##### Table of Contents






SELECTED HISTORICAL FINANCIAL DATA OF MAYORS























|                                                                                                                                                                     |  |                                                    |        |   |          |   |        |                  |  |   |                  |   |  |           |         |   |            |   |         |           |  |   |             |   |  |   |         |   |  |   |         |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------------------------------------------- | ------ | - | -------- | - | ------ | ---------------- |  | - | ---------------- | - |  | --------- | ------- | - | ---------- | - | ------- | --------- |  | - | ----------- | - |  | - | ------- | - |  | - | ------- | -
|                                                                                                                                                                     |  | Thirteen                                           |        |   | Thirteen |   |        | Fifty-Two        |  |   | Fifty-Two        |   |  | Fifty-Two |         |   | Transition |   |         | Fifty-Two |  |   | Fifty-Three |  
|                                                                                                                                                                     |  | Weeks                                              |        |   | Weeks    |   |        | Weeks            |  |   | Weeks            |   |  | Weeks     |         |   | Period     |   |         | Weeks     |  |   | Weeks       |  
|                                                                                                                                                                     |  | Ended                                              |        |   | Ended    |   |        | Ended            |  |   | Ended            |   |  | Ended     |         |   | Ended      |   |         | Ended     |  |   | Ended       |  
|                                                                                                                                                                     |  | June 25,                                           |        |   | June 26, |   |        | Mar. 26,         |  |   | Mar. 27,         |   |  | Mar. 29,  |         |   | Mar. 30,   |   |         | Feb. 2,   |  |   | Feb. 3,     |  
|                                                                                                                                                                     |  | 2005                                               |        |   | 2004     |   |        | 2005             |  |   | 2004             |   |  | 2003      |         |   | 2002(1)    |   |         | 2002      |  |   | 2001        |  
|                                                                                                                                                                     |  |                                                    |        |   |          |   |        |                  |  |   |                  |   |  |           |         |   |            |   |         |           |  |   |             |  
|                                                                                                                                                                     |  |                                                    |        |   |          |   |        | (As restated)(4) |  |   | (As restated)(4) |   |  |           |         |   |            |  
|                                                                                                                                                                     |  | (Amounts shown in thousands except per share data) |       
|INCOME STATEMENT DATA:                                                                                                                                               |  |                                                    |        |   |          |   |        |                  |  |   |                  |   |  |           |         |   |            |   |         |           |  |   |             |   |  |   |         |   |  |   |         |  
|Net sales                                                                                                                                                            |  | $                                                  | 32,543 |   |          | $ | 29,138 |                  |  | $ | 142,710          |   |  | $         | 125,487 |   |            | $ | 118,391 |           |  | $ | 17,856      |   |  | $ | 160,727 |   |  | $ | 179,557 |  
|Cost of sales                                                                                                                                                        |  |                                                    | 18,130 |   |          |   | 16,985 |                  |  |   | 81,715           |   |  |           | 73,427  |   |            |   | 78,740  |           |  |   | 11,966      |   |  |   | 101,179 |   |  |   | 101,544 |  
|                                                                                                                                                                     |  |                                                    |        |   |          |   |        |                  |  |   |                  |   |  |           |         |   |            |   |         |           |  |   |             |  
|Gross profit                                                                                                                                                         |  |                                                    | 14,413 |   |          |   | 12,153 |                  |  |   | 60,995           |   |  |           | 52,060  |   |            |   | 39,651  |           |  |   | 5,890       |   |  |   | 59,548  |   |  |   | 78,013  |  
|Selling, general and administrative expenses (including non-cash
    compensation expense, net of $103 and $1,067 for fiscal 2004 and
    fiscal 2003, respectively) |  |                                                    | 13,306 |   |          |   | 12,680 |                  |  |   | 53,729           |   |  |           | 52,283  |   |            |   | 53,719  |           |  |   | 9,287       |   |  |   | 76,206  |   |  |   | 69,381  |  
|Restructuring, asset impairments and other charges(3)                                                                                                                |  |                                                    | (79    | ) |          |   |       |                  |  |   | (1,212           | ) |  |           |        |   |            |   | 2,887   |           |  |   | 305         |   |  |   | 28,214  |   |  |   |        |  
|Depreciation and amortization                                                                                                                                        |  |                                                    | 784    |   |          |   | 833    |                  |  |   | 3,289            |   |  |           | 3,358   |   |            |   | 4,177   |           |  |   | 1,102       |   |  |   | 9,564   |   |  |   | 7,942   |  
|Goodwill impairment writedown                                                                                                                                        |  |                                                    |       |   |          |   |       |                  |  |   |                 |   |  |           |        |   |            |   | (615    | )         |  |   |            |   |  |   | 22,265  |   |  |   |        |  
|                                                                                                                                                                     |  |                                                    |        |   |          |   |        |                  |  |   |                  |   |  |           |         |   |            |   |         |           |  |   |             |  
|Operating income (loss)                                                                                                                                              |  |                                                    | 402    |   |          |   | (1,360 | )                |  |   | 5,189            |   |  |           | (3,581  | ) |            |   | (20,517 | )         |  |   | (4,804      | ) |  |   | (76,701 | ) |  |   | 690     |  
|Interest and other income                                                                                                                                            |  |                                                    |       |   |          |   | 3      |                  |  |   |                 |   |  |           | 184     |   |            |   | 1,433   |           |  |   | 41          |   |  |   | 174     |   |  |   | 213     |  
|Interest and other financial costs                                                                                                                                   |  |                                                    | (1,091 | ) |          |   | (1,115 | )                |  |   | (4,501           | ) |  |           | (4,427  | ) |            |   | (6,757  | )         |  |   | (538        | ) |  |   | (3,788  | ) |  |   | (3,450  | )
|                                                                                                                                                                     |  |                                                    |        |   |          |   |        |                  |  |   |                  |   |  |           |         |   |            |   |         |           |  |   |             |  
|Income (loss) from continuing operations before income taxes                                                                                                         |  |                                                    | (689   | ) |          |   | (2,472 | )                |  |   | 688              |   |  |           | (7,284  | ) |            |   | (25,841 | )         |  |   | (5,301      | ) |  |   | (80,315 | ) |  |   | (2,547  | )
|Income tax (benefit) provision                                                                                                                                       |  |                                                    |       |   |          |   |       |                  |  |   |                 |   |  |           |        |   |            |   | (547    | )         |  |   |            |   |  |   | 3,431   |   |  |   |        |  




147



---



##### Table of Contents






|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |       |   |   |         |       |   |   |        |       |  
|---------------------------------------------------------------------------------------------------------------- | ----------------------- | -------------------------------------------------- | ----- | ----- | -------- | - | ------ | ---------------- | - | - | ---------------- | ---- |  | --------- | ------ | ----- | ---------- | - | ------- | --------- | - | - | ----------- | ----- | - | - | ------- | ----- | - | - | ------ | ----- | -
|                                                                                                                 |                         | Thirteen                                           |       |       | Thirteen |   |        | Fifty-Two        |   |   | Fifty-Two        |      |  | Fifty-Two |        |       | Transition |   |         | Fifty-Two |   |   | Fifty-Three |      
|                                                                                                                 |                         | Weeks                                              |       |       | Weeks    |   |        | Weeks            |   |   | Weeks            |      |  | Weeks     |        |       | Period     |   |         | Weeks     |   |   | Weeks       |      
|                                                                                                                 |                         | Ended                                              |       |       | Ended    |   |        | Ended            |   |   | Ended            |      |  | Ended     |        |       | Ended      |   |         | Ended     |   |   | Ended       |      
|                                                                                                                 |                         | June 25,                                           |       |       | June 26, |   |        | Mar. 26,         |   |   | Mar. 27,         |      |  | Mar. 29,  |        |       | Mar. 30,   |   |         | Feb. 2,   |   |   | Feb. 3,     |      
|                                                                                                                 |                         | 2005                                               |       |       | 2004     |   |        | 2005             |   |   | 2004             |      |  | 2003      |        |       | 2002(1)    |   |         | 2002      |   |   | 2001        |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        | (As restated)(4) |   |   | (As restated)(4) |      |  |           |        |       |            |  
|                                                                                                                 |                         | (Amounts shown in thousands except per share data) |      
|Income (loss) from continuing operations                                                                         |                         |                                                    | (689  | )     |          |   | (2,472 | )                |   |   | 688              |      |  |           | (7,824 | )     |            |   | (25,294 | )         |   |   | (5,301      | )     |   |   | (83,746 | )     |   |   | (2,547 | )    
|Income (loss) from discontinued operations(2)                                                                    |                         |                                                    |      |       |          |   |       |                  |   |   |                 |      |  |           |       |       |            |   | (1,604  | )         |   |   | (56         | )     |   |   | (112    | )     |   |   | 13,544 |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|Net income (loss)                                                                                                |                         | $                                                  | (689  | )     |          | $ | (2,472 | )                |   | $ | 688              |      |  | $         | (7,824 | )     |            | $ | (26,898 | )         |   | $ | (5,357      | )     |   | $ | (83,858 | )     |   | $ | 10,997 |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|Preferred stock cumulative dividend                                                                              |                         |                                                    | (301  | )     |          |   |       |                  |   |   | (100             | )    |  |           | (1,316 | )     |            |   | (872    | )         |   |   |            |       |   |   |        |       |   |   |       |      
|Preferred stock beneficial conversion, value treated as a
    dividend                                           |                         |                                                    |      |       |          |   |       |                  |   |   |                 |      |  |           |       |       |            |   | (3,539  | )         |   |   |            |       |   |   |        |       |   |   |       |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|Relative fair value of warrants, value treated as a dividend                                                     |                         |                                                    |      |       |          |   |       |                  |   |   |                 |      |  |           |       |       |            |   | (3,539  | )         |   |   |             |       |   |   |         |       |   |   |        |      
|Value of the increase in the Series A Preferred conversion
    ratio and the additional warrants issued to Birks |                         |                                                    |      |       |          |   |       |                  |   |   | (17              | )    |  |           |       |       |            |   | (441    | )         |   |   |            |       |   |   |        |       |   |   |       |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|Net income (loss) attributable to common Stockholders                                                            |                         | $                                                  | (990  | )     |          | $ | (2,472 | )                |   | $ | 571              |      |  | $         | (9,140 | )     |            | $ | (35,289 | )         |   | $ | (5,357      | )     |   | $ | (83,858 | )     |   | $ | 10,997 |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|Net income (loss) per diluted common share, basic                                                                |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |       |   |   |         |       |   |   |        |      
|                                                                                                                 | Continuing operations   |                                                    | $     | (0.03 | )        |   | $      | (0.07            | ) |   | $                | 0.02 |  |           | $      | (0.35 | )          |   | $       | (1.72     | ) |   | $           | (0.27 | ) |   | $       | (4.31 | ) |   | $      | (0.13 | )
|                                                                                                                 | Discontinued operations |                                                    | $     | 0.00  |          |   | $      | 0.00             |   |   | $                | 0.00 |  |           | $      | 0.00  |            |   | $       | (0.08     | ) |   | $           | (0.00 | ) |   | $       | (0.01 | ) |   | $      | 0.69  |  
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|                                                                                                                 |                         | $                                                  | (0.03 | )     |          | $ | (0.07  | )                |   | $ | 0.02             |      |  | $         | (0.35  | )     |            | $ | (1.80   | )         |   | $ | (0.27       | )     |   | $ | (4.32   | )     |   | $ | 0.56   |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|Net income (loss) per common share, diluted                                                                      |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |       |   |   |         |       |   |   |        |      
|                                                                                                                 | Continuing operations   |                                                    | $     | (0.03 | )        |   | $      | (0.07            | ) |   | $                | 0.01 |  |           | $      | (0.35 | )          |   | $       | (1.72     | ) |   | $           | (0.27 | ) |   | $       | (4.31 | ) |   | $      | (0.13 | )
|                                                                                                                 | Discontinued operations |                                                    | $     | 0.00  |          |   | $      | 0.00             |   |   | $                | 0.00 |  |           | $      | 0.00  |            |   | $       | (0.08     | ) |   | $           | (0.00 | ) |   | $       | (0.01 | ) |   | $      | 0.69  |  
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      
|                                                                                                                 |                         | $                                                  | (0.03 | )     |          | $ | (0.07  | )                |   | $ | 0.01             |      |  | $         | (0.35  | )     |            | $ | (1.80   | )         |   | $ | (0.27       | )     |   | $ | (4.32   | )     |   | $ | 0.56   |      
|                                                                                                                 |                         |                                                    |       |       |          |   |        |                  |   |   |                  |      |  |           |        |       |            |   |         |           |   |   |             |      







|                      |  |                  |         |  |          |                  |         |          |  |   |          |  |  |         |         |  |         |   |         |  |  |   |         | 
|--------------------- |  | ---------------- | ------- |  | -------- | ---------------- | ------- | -------- |  | - | -------- |  |  | ------- | ------- |  | ------- | - | ------- |  |  | - | ------- | 
|                      |  | As of            |         |  | As of    |                  |         | As of    |  |   | As of    |  |  | As of   |         |  | As of   |  
|                      |  | June 25,         |         |  | Mar. 26, |                  |         | Mar. 27, |  |   | Mar. 29, |  |  | Feb. 2, |         |  | Feb. 3, |  
|                      |  | 2005             |         |  | 2005     |                  |         | 2004     |  |   | 2003     |  |  | 2002    |         |  | 2001    |  
|                      |  |                  |         |  |          |                  |         |          |  |   |          |  |  |         |         |  |         |  
|                      |  |                  |         |  |          | (As restated)(4) |         |          |  |   |          |  | 
|                      |  | ($ In thousands) |        
|BALANCE SHEET DATA:   |  |                  |         |  |          |                  |         |          |  |   |          |  |  |         |         |  |         |   |         |  |  |   |         | 
|Working capital       |  | $                | 34,204  |  |          | $                | 35,829  |          |  | $ | 33,618   |  |  | $       | 41,533  |  |         | $ | 37,926  |  |  | $ | 124,672 | 
|Total assets          |  |                  | 104,786 |  |          |                  | 102,786 |          |  |   | 105,215  |  |  |         | 103,183 |  |         |   | 144,589 |  |  |   | 224,052 | 
|Stockholders equity  |  |                  | 33,076  |  |          |                  | 34,291  |          |  |   | 33,484   |  |  |         | 42,427  |  |         |   | 61,107  |  |  |   | 144,259 | 
|Long-term obligations |  |                  | 11,668  |  |          |                  | 12,668  |          |  |   | 12,668   |  |  |         | 12,668  |  |         |   |        |  |  |   | 44,390  | 









|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The transition period presented is from February 3, 2002
    through March 30, 2002 and is presented as a result of
    Mayors change in fiscal year from the Saturday closest to
    January 31 to the Saturday closest to March 31 as reported
    on Form 8-K which was filed with the SEC on
    January 29, 2003. On July 29, 2003, Mayors filed
    a Form 8-K with the SEC to change its fiscal year end from
    the Saturday closest to March 31, to the last Saturday in
    March, effective July 22, 2003.

148



---



##### Table of Contents





|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The (loss) income from discontinued operations for the fifty-two
    week periods ended March 29, 2003 and February 2,
    2002, fifty-three week period ended February 3, 2001 and
    the transition period include the discontinued operations of the
    store at Tysons Galleria in McLean, Virginia which was closed in
    March 2003. The (loss) income from discontinued operations for
    the fifty-three week period ended February 3, 2001 include
    the operations of the Sams Division jewelry counters
    operated within Sams Wholesale stores prior to the
    expiration of the agreement.
|   
|(3) | Restructuring, asset impairments and other charges for the
    fifty-two weeks ended March 26, 2005 include approximately
    ($1.2) million of income as a result of a settlement of a
    sales tax audit for less than the amount accrued as well as the
    adjustment of other sales tax contingency estimates.                                                                                                                                                                                                                                                                                              



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Restructuring, asset impairments and other charges for the
    fifty-two weeks ended March 29, 2003 consist of one time
    charges primarily for professional fees related to the execution
    of the Restructuring Plan, reserves related to sales tax
    liabilities, severance costs related to the departure of the
    former Chief Executive Officer and charges related to the sale
    of certain of Mayors accounts receivable, net of a
    reversal to income of reserves related to the exit of leases for
    closed stores.                                     
|
| | Restructuring, asset impairments and other charges for the
    fifty-two weeks ended February 2, 2002 include amounts for
    the write-down of the fixed assets for the stores that were
    scheduled to be closed, a reserve for early termination of the
    leases for the stores that were scheduled to be closed, a
    write-down of the corporate headquarters building which
    Mayors placed on the market for sale, consulting fees
    related to a strategic cost reduction project, and non-recurring
    legal fees associated with stockholder-related matters.



|    |                                                                                                                                                              
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|(4) | For a description of the restatement, see Note B to
    Mayors consolidated financial statements included
    elsewhere in this proxy statement/ prospectus.

149



---



##### Table of Contents






MANAGEMENTS DISCUSSION AND ANALYSIS OF


THE FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF
MAYORS


The following Managements Discussion and Analysis of
Financial Condition and Results of Operations gives effect to
the restatement discussed in Note B to Mayors
consolidated financial statements included elsewhere in this
proxy statement/ prospectus.


General




Overview






















150



---



##### Table of Contents
















|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  |  |       |    |  |   |         |   |  |  |       |   
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | ------ | - | -------------- |  | ----- | ------------- |  | - | ------------- | - |  | ------------- | ----- | -- |  | - | ------- | - |  |  | ----- | - |  | - | ------- | - |  |  | ----- | -- |  | - | ------- | - |  |  | ----- | --
|                                                                                                                                                                     |  | Thirteen Weeks |        |   | Thirteen Weeks |  |       |               |  |   |               |  
|                                                                                                                                                                     |  | Ended          |        |   | Ended          |  |       | Year Ended    |  |   | Year Ended    |   |  | Year Ended    |      
|                                                                                                                                                                     |  | June 25, 2005  |        |   | June 26, 2004  |  |       | Mar. 26, 2005 |  |   | Mar. 27, 2004 |   |  | Mar. 29, 2003 |      
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |      
|Net sales                                                                                                                                                            |  | $              | 32,543 |   |                |  | 100.0 | %             |  | $ | 29,138        |   |  |               | 100.0 | %  |  | $ | 142,710 |   |  |  | 100.0 | % |  | $ | 125,487 |   |  |  | 100.0 | %  |  | $ | 118,391 |   |  |  | 100.0 | % 
|Cost of sales                                                                                                                                                        |  |                | 18,130 |   |                |  | 55.7  |               |  |   | 16,985        |   |  |               | 58.3  |    |  |   | 81,715  |   |  |  | 57.3  |   |  |   | 73,427  |   |  |  | 58.5  |    |  |   | 78,740  |   |  |  | 66.5  |   
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 
|Gross Profit                                                                                                                                                         |  |                | 14,413 |   |                |  | 44.3  |               |  |   | 12,153        |   |  |               | 41.7  |    |  |   | 60,995  |   |  |  | 42.7  |   |  |   | 52,060  |   |  |  | 41.5  |    |  |   | 39,651  |   |  |  | 33.5  |   
|Selling, general and administrative expenses (including non-cash
    compensation expense, net of $103 and $1,067, in fiscal 2004 and
    fiscal 2003, respectively) |  |                | 13,306 |   |                |  | 40.9  |               |  |   | 12,680        |   |  |               | 43.5  |    |  |   | 53,729  |   |  |  | 37.6  |   |  |   | 52,283  |   |  |  | 41.6  |    |  |   | 53,719  |   |  |  | 45.4  |   
|Restructuring, asset impairments and other charges                                                                                                                   |  |                | (79    | ) |                |  | (0.2  | )             |  |   |              |   |  |               |      |    |  |   | (1,212  | ) |  |  | (0.9  | ) |  |   |        |   |  |  |      |    |  |   | 2,887   |   |  |  | 2.4   |   
|Depreciation and amortization                                                                                                                                        |  |                | 784    |   |                |  | 2.4   |               |  |   | 833           |   |  |               | 2.9   |    |  |   | 3,289   |   |  |  | 2.3   |   |  |   | 3,358   |   |  |  | 2.7   |    |  |   | 4,177   |   |  |  | 3.5   |   
|Goodwill impairment writedown                                                                                                                                        |  |                |       |   |                |  |      |               |  |   |              |   |  |               |      |    |  |   |        |   |  |  |      |   |  |   |        |   |  |  |      |    |  |   | (615    | ) |  |  | (.5   | ) 
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 
|Operating income (loss)                                                                                                                                              |  |                | 402    |   |                |  | 1.2   |               |  |   | (1,360        | ) |  |               | (4.7  | )  |  |   | 5,189   |   |  |  | 3.7   |   |  |   | (3,581  | ) |  |  | (2.8  | )  |  |   | (20,517 | ) |  |  | (17.3 | ) 
|Interest and other income                                                                                                                                            |  |                |       |   |                |  |      |               |  |   | 3             |   |  |               |      |    |  |   |        |   |  |  |      |   |  |   | 184     |   |  |  | 0.1   |    |  |   | 1,433   |   |  |  | 1.2   |   
|Interest and other financial costs                                                                                                                                   |  |                | (1,091 | ) |                |  | (3.4  | )             |  |   | (1,115        | ) |  |               | (3.8  | )  |  |   | (4,501  | ) |  |  | (3.2  | ) |  |   | (4,427  | ) |  |  | (3.5  | )  |  |   | (6,757  | ) |  |  | (5.7  | ) 
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 
|Income (loss) from continuing operations before income taxes                                                                                                         |  |                | (689   | ) |                |  | (2.1  | )             |  |   | (2,472        | ) |  |               | (8.5  | )  |  |   | 688     |   |  |  | 0.5   |   |  |   | (7,824  | ) |  |  | (6.2  | )  |  |   | (25,841 | ) |  |  | (21.8 | ) 
|Income tax benefit                                                                                                                                                   |  |                |       |   |                |  |      |               |  |   |              |   |  |               |      |    |  |   |        |   |  |  |      |   |  |   |        |   |  |  |      |    |  |   | (547    | ) |  |  | (.4   | ) 
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 
|Income (loss) from continuing operations                                                                                                                             |  |                | (689   | ) |                |  | (2.1  | )             |  |   | (2,472        | ) |  |               | (8.5  | )  |  |   | 688     |   |  |  | 0.5   |   |  |   | (7,824  | ) |  |  | (6.2  | )  |  |   | (25,294 | ) |  |  | (21.4 | ) 
|Income (loss) from discontinued operations                                                                                                                           |  |                |       |   |                |  |      |               |  |   |              |   |  |               |      |    |  |   |        |   |  |  |      |   |  |   |        |   |  |  |      |    |  |   | (1,604  | ) |  |  | (1.3  | ) 
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 
|Net income (loss)                                                                                                                                                    |  | $              | (689   | ) |                |  | (2.1  | )%            |  | $ | (2,472        | ) |  |               | (8.5  | )% |  | $ | 688     |   |  |  | 0.5   | % |  | $ | (7,824  | ) |  |  | (6.2  | )% |  | $ | (26,898 | ) |  |  | (22.7 | )%
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 
|Number of stores at period-end                                                                                                                                       |  |                |        |   |                |  | 28    |               |  |   |               |   |  |               | 28    |    |  |   |         |   |  |  | 28    |   |  |   |         |   |  |  | 27    |    |  |   |         |   |  |  | 28    |   
|                                                                                                                                                                     |  |                |        |   |                |  |       |               |  |   |               |   |  |               |       |    |  |   |         |   |  |  |       |   |  |   |         |   |  | 









| |                                                                                          
| | -----------------------------------------------------------------------------------------
| | Thirteen Weeks Ended June 25, 2005 compared to the
    Thirteen Weeks ended June 26, 2004




















151



---



##### Table of Contents
















































| |                                                                                            
| | -------------------------------------------------------------------------------------------
| | Year Ended March 26, 2005 compared to the Years Ended
    March 27, 2004 and March 29, 2003




Results of Operations




| |      
| | -----
| | Sales











| |                               
| | ------------------------------
| | Cost of Sales and Gross Profit









152



---



##### Table of Contents







| |                                             
| | --------------------------------------------
| | Selling, General and Administrative Expenses



153



---



##### Table of Contents





| |                                                   
| | --------------------------------------------------
| | Restructuring, Asset Impairments and Other Charges







| |                              
| | -----------------------------
| | Depreciation and Amortization





| |                              
| | -----------------------------
| | Goodwill Impairment Writedown





| |                                                                     
| | --------------------------------------------------------------------
| | Interest and Other Income and Interest and Other Financial
    Costs







| |             
| | ------------
| | Income Taxes





| |                                  
| | ---------------------------------
| | Loss from Discontinued Operations



Liquidity and Capital Resources










154



---



##### Table of Contents





















|                                                      |  |                   |        |   |            |   |        |  
|----------------------------------------------------- |  | ----------------- | ------ | - | ---------- | - | ------ | -
|                                                      |  | Year Ended        |        |   | Year Ended |  
|                                                      |  | Mar. 26,          |        |   | Mar. 27,   |  
|                                                      |  | 2005              |        |   | 2004       |  
|                                                      |  |                   |        |   |            |  
|                                                      |  | (Amounts shown in |       
|                                                      |  | thousands)        |       
|Maximum borrowings outstanding during the fiscal year |  | $                 | 48,417 |   |            | $ | 39,955 |  
|Average outstanding balance during the fiscal year    |  | $                 | 35,178 |   |            | $ | 31,004 |  
|Weighted average interest rate for the fiscal year    |  |                   | 5.6    | % |            |   | 6.3    | %











155



---



##### Table of Contents























Effects of Inflation






Interest Rate Risk


















156



---



##### Table of Contents





Foreign Currency Risk




Critical Accounting Policies and Estimates










Allowance for doubtful accounts.


Long-lived Assets.


Revenue Recognition.


157



---



##### Table of Contents





Contractual Commitments




|                                                  |  |                 |        |           |        |   |       |           |  |   |           |  |  |         |       |  |  |   |        | 
|------------------------------------------------- |  | --------------- | ------ | --------- | ------ | - | ----- | --------- |  | - | --------- |  |  | ------- | ----- |  |  | - | ------ | 
|                                                  |  | Payments Due by |        |           |        |   |       |           | 
|                                                  |  | Period          |        |           |        |   |       |           | 
|                                                  |  |                 |        |           |        |   |       |           | 
|                                                  |  |                 |        | Less Than |        |   |       |           |  |   | More Than | 
|                                                  |  | Total           |        |           | 1 Year |   |       | 1-3 Years |  |   | 3-5 Years |  |  | 5 Years |      
|                                                  |  |                 |        |           |        |   |       |           |  |   |           |  |  |         |      
|                                                  |  | (In thousands)  |       
|Long-term debt                                    |  | $               | 12,668 |           |        | $ |      |           |  | $ | 12,668    |  |  | $       |      |  |  | $ |       | 
|Credit facility                                   |  |                 | 33,501 |           |        |   |      |           |  |   | 33,501    |  |  |         |      |  |  |   |       | 
|Capital leases                                    |  |                 | 312    |           |        |   | 102   |           |  |   | 201       |  |  |         | 9     |  |  |   |       | 
|Fixed rate interest payments  term loan (12.75%) |  |                 | 2,243  |           |        |   | 1,615 |           |  |   | 628       |  |  |         |      |  |  |   |       | 
|Employment Agreements                             |  |                 | 2,225  |           |        |   | 1,018 |           |  |   | 1,207     |  |  |         |      |  |  |   |       | 
|Operating leases(1)                               |  |                 | 41,717 |           |        |   | 7,102 |           |  |   | 11,664    |  |  |         | 9,816 |  |  |   | 13,135 | 
|                                                  |  |                 |        |           |        |   |       |           |  |   |           |  |  |         |      
|                                                  |  | $               | 92,666 |           |        | $ | 9,837 |           |  | $ | 59,869    |  |  | $       | 9,825 |  |  | $ | 13,135 | 
|                                                  |  |                 |        |           |        |   |       |           |  |   |           |  |  |         |      






|    |                                                                                                                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The operating lease obligations do not include insurance, taxes
    and common area maintenance (CAM) charges to which
    Mayors is obligated. CAM charges were $1.5 million
    for fiscal 2004.

Leases






Newly Issued Accounting Standards






158



---



##### Table of Contents









159



---



##### Table of Contents






DESCRIPTION OF MAYORS BUSINESS


General














Products








160



---



##### Table of Contents



Product Development and Sourcing






| |        
| | -------
| | Watches





| |                                                    
| | ---------------------------------------------------
| | Diamond, Gemstone, Pearl and Precious Metal Jewelry





| |               
| | --------------
| | Other Products



Availability of Products






161



---



##### Table of Contents



Changing Prices and Availability




Seasonality




Manufacturing and Repair




Retail Operations, Merchandising and Marketing




| |        
| | -------
| | General







| |                       
| | ----------------------
| | Personnel and Training



162



---



##### Table of Contents









| |                          
| | -------------------------
| | Advertising and Promotion







| |                  
| | -----------------
| | Credit Operations









163



---



##### Table of Contents







Financial Information




Distribution




Competition




Regulation






164



---



##### Table of Contents



Trademarks


tm


Employees




Related Party Transactions








165



---



##### Table of Contents

















166



---



##### Table of Contents























167



---



##### Table of Contents



















PROPERTIES






168



---



##### Table of Contents





|                                 |  |             |        |  |            |  |          |          |  |  |                        | 
|-------------------------------- |  | ----------- | ------ |  | ---------- |  | -------- | -------- |  |  | ---------------------- | 
|                                 |  | Total       |        |  |            |  |         
|Operating Stores                 |  | Square Feet |        |  | Expiration |  |          | Location | 
|                                 |  |             |        |  |            |  |          |          | 
|Altamonte Mall                   |  |             | 5,782  |  |            |  | Jan-2011 |          |  |  | Altamonte Springs, FL  | 
|Aventura Mall                    |  |             | 3,447  |  |            |  | Jan-2009 |          |  |  | N. Miami Beach, FL     | 
|Bell Tower                       |  |             | 4,578  |  |            |  | Jan-2012 |          |  |  | Fort Myers, FL         | 
|Boca Town Center                 |  |             | 5,878  |  |            |  | Jan-2007 |          |  |  | Boca Raton, FL         | 
|Brandon Town Center*             |  |             | 4,110  |  |            |  | Jun-2005 |          |  |  | Brandon, FL            | 
|Broward Mall                     |  |             | 2,236  |  |            |  | Jan-2010 |          |  |  | Plantation, FL         | 
|Buckhead                         |  |             | 10,000 |  |            |  | Apr-2009 |          |  |  | Atlanta, GA            | 
|Citrus Park Town Center          |  |             | 3,953  |  |            |  | Jan-2010 |          |  |  | Tampa, FL              | 
|City Place at West Palm Beach    |  |             | 6,113  |  |            |  | Jan-2011 |          |  |  | West Palm Beach, FL    | 
|Dadeland Mall                    |  |             | 5,700  |  |            |  | Jan-2007 |          |  |  | Miami, FL              | 
|The Falls                        |  |             | 1,643  |  |            |  | Jan-2009 |          |  |  | Miami, FL              | 
|Florida Mall                     |  |             | 5,070  |  |            |  | Jan-2010 |          |  |  | Orlando, FL            | 
|The Galleria at Fort Lauderdale* |  |             | 3,682  |  |            |  | Jan-2005 |          |  |  | Ft. Lauderdale, FL     | 
|International Plaza              |  |             | 5,583  |  |            |  | Jan-2012 |          |  |  | Tampa, FL              | 
|Lenox Square Mall                |  |             | 4,587  |  |            |  | Dec-2005 |          |  |  | Atlanta, GA            | 
|Lincoln Road                     |  |             | 4,250  |  |            |  | May-2009 |          |  |  | Miami Beach, FL        | 
|Mall of Georgia                  |  |             | 3,486  |  |            |  | Jan-2010 |          |  |  | Buford, GA             | 
|Mall at Millenia                 |  |             | 4,532  |  |            |  | Jan-2013 |          |  |  | Orlando, FL            | 
|Mall at Wellington Green         |  |             | 4,001  |  |            |  | Jan-2012 |          |  |  | Wellington, FL         | 
|Miami International Mall         |  |             | 3,226  |  |            |  | Jan-2006 |          |  |  | Miami, FL              | 
|North Point Mall                 |  |             | 4,752  |  |            |  | Jan-2012 |          |  |  | Alpharetta, GA         | 
|Perimeter Mall                   |  |             | 5,157  |  |            |  | Jan-2009 |          |  |  | Atlanta, GA            | 
|PGA Commons                      |  |             | 5,197  |  |            |  | Apr-2014 |          |  |  | Palm Beach Gardens, FL | 
|Seminole Towne Center            |  |             | 3,461  |  |            |  | Jan-2006 |          |  |  | Sanford, FL            | 
|The Shops at Sunset Place        |  |             | 2,051  |  |            |  | Jan-2010 |          |  |  | South Miami, FL        | 
|Southgate Plaza                  |  |             | 4,605  |  |            |  | Mar-2010 |          |  |  | Sarasota, FL           | 
|Treasure Coast Square            |  |             | 2,506  |  |            |  | Jan-2006 |          |  |  | Jensen Beach, FL       | 
|Village of Merrick Park          |  |             | 4,894  |  |            |  | Jan-2013 |          |  |  | Coral Gables, FL       | 






|  |                                                                                                                            
|- | ---------------------------------------------------------------------------------------------------------------------------
|* | All financial terms of the lease are completed and Mayors
    is in process of finalizing the business terms of the lease.

LEGAL PROCEEDINGS












169



---



##### Table of Contents






1 2





Changes In And Disagreements With Accountants On Accounting
And Financial Disclosure








170



---



##### Table of Contents






MANAGEMENT OF MAYORS


Information Regarding Mayors Directors and Executive
Officers Upon Consummation of the Merger




Information Regarding Mayors Directors and Executive
Officers





|                              |  |     |    |  |          |                                                                               |         |  |           |                |  |  |     | 
|----------------------------- |  | --- | -- |  | -------- | ----------------------------------------------------------------------------- | ------- |  | --------- | -------------- |  |  | --- | 
|                              |  |     |    |  |          | Expiration                                                                    |         |  | Preferred |               
|Name                          |  | Age |    |  | Position |                                                                               | of Term |  |           | Stock Director | 
|                              |  |     |    |  |          |                                                                               |         |  |           |                | 
|Thomas A. Andruskevich(1)     |  |     | 54 |  |          | Chairman of the board of directors, President and Chief
    Executive Officer |         |  | 2006      |                |  |  | Yes | 
|Emily Berlin(2)(3)(4)(5)      |  |     | 57 |  |          | Director                                                                      |         |  | 2005      |                |  |  | Yes | 
|Elizabeth M. Eveillard(1)(5)  |  |     | 58 |  |          | Director                                                                      |         |  | 2005      |                |  |  | Yes | 
|Massimo Ferragamo(3)(4)(5)    |  |     | 47 |  |          | Director                                                                      |         |  | 2007      |                |  |  | Yes | 
|Stephen M. Knopik(2)(4)(5)(6) |  |     | 49 |  |          | Director                                                                      |         |  | 2005      |                |  |  | No  | 
|Ann Spector Lieff(3)(4)(5)(6) |  |     | 53 |  |          | Director                                                                      |         |  | 2007      |                |  |  | Yes | 
|Judith R. MacDonald(2)(5)(6)  |  |     | 62 |  |          | Director                                                                      |         |  | 2007      |                |  |  | No  | 
|Filippo Recami(1)(5)          |  |     | 54 |  |          | Director                                                                      |         |  | 2006      |                |  |  | Yes | 
|Joseph A. Kiefer, III         |  |     | 53 |  |          | Senior Vice President and Chief Operating Officer                             |         |  |           |                |  |  |     | 
|Lawrence Litowitz             |  |     | 54 |  |          | Principal Financial Officer and Principal Accounting Officer                  |         |  |           |                |  |  |     | 
|Daisy Chin-Lor                |  |     | 51 |  |          | Senior Vice President and Chief Marketing Officer                             |         |  |           |                |  |  |     | 
|Marc Weinstein                |  |     | 51 |  |          | Senior Vice President and Chief Administrative Officer                        |         |  |           |                |  |  |     | 
|Michael Rabinovitch           |  |     | 35 |  |          | Senior Vice President & Chief Financial Officer                               |         |  |           |                |  |  |     | 
|Carlo Coda-Nunziante(7)       |  |     | 41 |  |          | Group Vice President of Strategy and Business Development                     |         |  |           |                |  |  |     | 
|John Orrico                   |  |     | 48 |  |          | Group Vice President, Supply Chain Operations                                 |         |  |           |                |  |  |     | 
|Marco Pasteris                |  |     | 44 |  |          | Group Vice President, Finance                                                 |         |  |           |                |  |  |     | 
|Aida Alvarez                  |  |     | 42 |  |          | Group Vice President Category Management                                      |         |  |           |                |  |  |     | 
|Albert J. Rahm, II            |  |     | 52 |  |          | Vice President Retail Store Operations                                        |         |  |           |                |  |  |     | 
|Gerald Berclaz(7)             |  |     | 56 |  |          | Director                                                                      |         |  |           |                |  |  |     | 
|Davide Barberis Canonico(7)   |  |     | 39 |  |          | Director                                                                      |         |  |           |                |  |  |     | 









|    |                                                                                       
|--- | --------------------------------------------------------------------------------------
|(1) | Member of the executive committee.                                                    
|   
|(2) | Member of the corporate governance committee, the Chairman of
    which is Ms. Berlin.
|   
|(3) | Member of the compensation committee, the Chairman of which is
    Ms. Lieff.         
|   
|(4) | Member of the nominating committee, the Chairman of which is
    Mr. Ferragamo.       
|   
|(5) | Will cease to be a director upon consummation of the merger.                          
|   
|(6) | Member of the audit committee, the Chairman of which is
    Mr. Knopik.               
|   
|   
|(7) | Will become a director of Mayors upon consummation of the
    merger.                
|   

171



---



##### Table of Contents



Directors


Thomas A. Andruskevich


Emily Berlin


Elizabeth M. Eveillard


Massimo Ferragamo


Stephen M. Knopik


Ann Spector Lieff


Judith R. MacDonald


172



---



##### Table of Contents



Filippo Recami


Gerald Berclaz


David Barberis Canonico


Carlo Coda-Nunziante


Executive Officers


Joseph A. Keifer, III





Lawrence Litowitz





Daisy Chin-Lor


Marc Weinstein


173



---



##### Table of Contents








Michael Rabinovitch,





John C. Orrico


Marco Pasteris


Aida Alvarez


Albert J. Rahm, II


The Board of Directors and Board Committees




174



---



##### Table of Contents







| |                
| | ---------------
| | Audit Committee



Audit Committee Report.
















| |                          
| | -------------------------
| | Stephen M. Knopik (Chair)
| | Judith R. MacDonald      
| | Ann Spector Lieff        

175



---



##### Table of Contents



Compensation of Independent Auditors.




| |           
| | ----------
| | Audit Fees









| |                   
| | ------------------
| | Audit Related Fees





| |         
| | --------
| | Tax Fees





| |               
| | --------------
| | All Other Fees





| |                                     
| | ------------------------------------
| | Pre Approval Policies and Procedures





| |                       
| | ----------------------
| | Compensation Committee



176



---



##### Table of Contents





| |                     
| | --------------------
| | Nominating Committee






th







[                    ]




| |                               
| | ------------------------------
| | Corporate Governance Committee



Corporate Governance Committee Report.


177



---



##### Table of Contents









| |                     
| | --------------------
| | Emily Berlin (Chair)
| | Judith R. MacDonald 
| | Stephen M. Knopik   



| |                    
| | -------------------
| | Executive Committee







Compensation of Directors








Section 16(a) Beneficial Ownership Reporting
Compliance




178



---



##### Table of Contents





Communication with the Board of Directors and Director
Attendance at Annual Meetings







th





Code of Ethics










Executive Compensation




Summary Compensation Table


|                            |                                      |        |      |                     |        |        |         |         |            |                        |              |            |     |          |        |        |              |           |   |         |  |  |              |           |     |  |   |   |  |  |   |   | 
|--------------------------- | ------------------------------------ | ------ | ---- | ------------------- | ------ | ------ | ------- | ------- | ---------- | ---------------------- | ------------ | ---------- | --- | -------- | ------ | ------ | ------------ | --------- | - | ------- |  |  | ------------ | --------- | --- |  | - | - |  |  | - | - | 
|                            |                                      |        |      |                     |        |        |         |         |            | Long-Term Compensation |              |            |    
|                            |                                      |        |      |                     |        |        |         |         |            |                        |              |            |    
|                            |                                      |        |      | Annual Compensation |        |        | Awards  |         |            | Payouts                |              |            |    
|                            |                                      |        |      |                     |        |        |         |         |            |                        |              |            |    
|                            |                                      |        |      |                     |        | Other  |         |         | Restricted |                        |              | Securities |     |          |        |        |             
|                            |                                      |        |      |                     |        | Annual |         |         | Stock      |                        |              | Underlying |     |          | LTIP   |        |              | All Other |  
|                            |                                      | Fiscal |      |                     | Salary |        |         | Bonus   |            |                        | Compensation |            |     | Award(s) |        |        | Options/SARs |           |   | Payouts |  |  | Compensation |          
|Name and Principal Position |                                      | Year   |      |                     | ($)    |        |         | ($)     |            |                        | ($)          |            |     | ($)      |        |        | (#)          |           |   | ($)     |  |  | ($)          |          
|                            |                                      |        |      |                     |        |        |         |         |            |                        |              |            |     |          |        |        |              |           |   |         |  |  |              |          
|Thomas A. Andruskevich      |                                      |        | 2004 |                     |        |        | 500,000 |         |            |                        | 366,742      | (2)        |     |          | 15,000 |        |              |           | 0 |         |  |  | 0            |           |     |  | 0 |   |  |  | 0 |  
|                            | Chairman of the Board, President and |        |      | 2003                |        |        |         | 500,000 |            |                        |              | 265,150    | (9) |          |        | 15,000 |              |           |   | 0       |  |  |              | 0         |     |  |   | 0 |  |  |   | 0 | 
|                            | Chief Executive Officer(1)           |        |      | 2002                |        |        |         | 228,846 |            |                        |              | 55,000     |     |          |        | 6,343  |              |           |   | 0       |  |  |              | 1,500,000 | (4) |  |   | 0 |  |  |   | 0 | 
|Joseph A. Keifer, III       |                                      |        | 2004 |                     |        |        | 380,000 |         |            |                        | 146,551      | (2)        |     |          | 27,073 |        |              |           | 0 |         |  |  | 0            |           |     |  | 0 |   |  |  | 0 |  
|                            | Chief Operating Officer and          |        |      | 2003                |        |        |         | 380,000 |            |                        |              | 152,000    | (9) |          |        | 21,242 |              |           |   | 0       |  |  |              | 0         |     |  |   | 0 |  |  |   | 0 | 
|                            | Senior Vice President(5)             |        |      | 2002                |        |        |         | 173,923 |            |                        |              | 25,000     |     |          |        | 13,341 |              |           |   | 0       |  |  |              | 500,000   | (6) |  |   | 0 |  |  |   | 0 | 
|Marc Weinstein              |                                      |        | 2004 |                     |        |        | 240,000 |         |            |                        | 101,376      | (2)        |     |          | 29,485 |        |              |           | 0 |         |  |  | 0            |           |     |  | 0 |   |  |  | 0 |  
|                            | Chief Administrative Officer         |        |      | 2003                |        |        |         | 238,462 |            |                        |              | 104,544    | (9) |          |        | 24,790 |              |           |   | 0       |  |  |              | 0         |     |  |   | 0 |  |  |   | 0 | 
|                            | and Senior Vice President            |        |      | 2002                |        |        |         | 200,000 |            |                        |              | 115,000    | (3) |          |        | 28,580 |              |           |   | 0       |  |  |              | 100,000   | (7) |  |   | 0 |  |  |   | 0 | 
|Albert J. Rahm, II          |                                      |        | 2004 |                     |        |        | 196,539 |         |            |                        | 73,894       | (2)        |     |          | 17,253 |        |              |           | 0 |         |  |  | 0            |           |     |  | 0 |   |  |  | 0 |  
|                            | Vice President-Retail                |        |      | 2003                |        |        |         | 185,000 |            |                        |              | 74,000     | (9) |          |        | 18,405 |              |           |   | 0       |  |  |              | 0         |     |  |   | 0 |  |  |   | 0 | 
|                            | Store Operations                     |        |      | 2002                |        |        |         | 185,000 |            |                        |              | 92,500     | (3) |          |        | 20,209 |              |           |   | 0       |  |  |              | 30,000    | (8) |  |   | 0 |  |  |   | 0 | 
|Aida Alvarez                |                                      |        | 2004 |                     |        |        | 171,539 |         |            |                        | 50,329       | (2)        |     |          | 20,297 |        |              |           | 0 |         |  |  | 0            |           |     |  | 0 |   |  |  | 0 |  
|                            | Group Vice President-                |        |      | 2003                |        |        |         | 159,385 |            |                        |              | 56,000     | (9) |          |        | 24,653 |              |           |   | 0       |  |  |              | 0         |     |  |   | 0 |  |  |   | 0 | 
|                            | Category Management                  |        |      | 2002                |        |        |         | 144,000 |            |                        |              | 72,000     | (3) |          |        | 19,033 |              |           |   | 0       |  |  |              | 20,000    | (9) |  |   | 0 |  |  |   | 0 | 

179



---



##### Table of Contents








| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Salary for 2002 represents services from October 1, 2002,
    the date of commencement of employment, to March 29, 2003.
    Mr. Andruskevich resides in New Jersey but spends a
    significant amount of time working in Sunrise, Florida in his
    capacity as President and Chief Executive Officer of
    Mayors. Instead of reimbursing Mr. Andruskevich for
    hotel accommodation and car rental service in Sunrise,
    Mayors provides Mr. Andruskevich with the non
    exclusive use of an apartment and an automobile. The apartment
    and automobile are made available to and utilized by other
    employees. Mayors does not account for these expenses as
    compensation and Mayors has been advised that they are not
    taxable as benefits to Mr. Andruskevich. Accordingly, the
    value of these items is not included in the table above.
|
| | (2) | The bonuses were earned during the year ended March 26,
    2005, but were not paid until June 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| | (3) | The bonus of these Executive Officers represent specific
    retention bonuses that were established for these specific key
    executives in order to incentivize them to remain with
    Mayors during a time of significant uncertainty regarding
    Mayors future.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | (4) | Mr. Andruskevichs stock options were granted on
    October 1, 2002. In addition to the Mayors stock
    option grants listed herein, Mr. Andruskevich was assigned
    1,500,000 warrants by Birks to purchase shares of Mayors
    Common Stock at $0.30 per share, vesting over a 3 year
    period in 3 equal installments of 500,000 on January 31,
    2003, 500,000 on January 31, 2004 and 500,000 on
    January 31, 2005.                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | (5) | Salary for 2002 represents service from October 1, 2002,
    the date of commencement of employment, to March 29, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (6) | Mr. Keifers stock options were granted on
    October 1, 2002. In addition to the Mayors stock
    option grants listed herein, Mr. Keifer was assigned
    500,000 warrants by Birks to purchase shares of Mayors
    Common Stock at $0.30 per share, vesting over a 3 year
    period in 3 installments: 166,666 on January 31, 2003,
    166,666 on January 31, 2004 and 166,608 on January 31,
    2005.                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| | (7) | These stock options were granted to Mr. Weinstein as
    follows: 100,000 on October 1, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | (8) | These stock options were granted to Mr. Rahm as follows:
    30,000 on October 1, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (9) | These stock options were granted to Ms. Alvarez as follows:
    20,000 on October 1, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   



|     |                                                                                                         
|---- | --------------------------------------------------------------------------------------------------------
|(10) | The bonuses were earned during the year ended March 27,
    2004, but were not paid until June 25, 2004.



| |                                  
| | ---------------------------------
| | Option Grants in Last Fiscal Year





| |                                                                               
| | ------------------------------------------------------------------------------
| | Aggregated Option Exercises In Last Fiscal Year And
    Year-End Option Values



Aggregated Option Exercises in Last Fiscal Year


and Fiscal Year-End Option Values


|                       |  |             |   |  |          |                      |                        |                            |                      |                         |                     |  |  |             |         |  |               |   |         |  |  |   |        | 
|---------------------- |  | ----------- | - |  | -------- | -------------------- | ---------------------- | -------------------------- | -------------------- | ----------------------- | ------------------- |  |  | ----------- | ------- |  | ------------- | - | ------- |  |  | - | ------ | 
|                       |  |             |   |  |          | Number of Securities |                        |                            | Value of Unexercised |                        
|                       |  | Shares      |   |  |          |                      | Underlying Unexercised |                            |                      | In-the-Money Options at |                    
|                       |  | Acquired on |   |  | Value    |                      |                        | Options at Fiscal Year-End |                      |                         | Fiscal Year-End ($) | 
|                       |  | Exercise    |   |  | Realized |                      |                        |                            |                      |                         |                     | 
|Name                   |  | (#)         |   |  | ($)      |                      |                        | Exercisable                |                      |                         | Unexercisable       |  |  | Exercisable |         |  | Unexercisable |  
|                       |  |             |   |  |          |                      |                        |                            |                      |                         |                     |  |  |             |         |  |               |  
|Thomas A. Andruskevich |  |             | 0 |  |          |                      | 0                      |                            |                      |                         | 1,500,000           |  |  |             | 0       |  |               | $ | 570,000 |  |  | $ | 0      | 
|Joseph A. Keifer, III  |  |             | 0 |  |          |                      | 0                      |                            |                      |                         | 333,333             |  |  |             | 166,667 |  |               |   | 127,000 |  |  |   | 63,000 | 
|Marc Weinstein         |  |             | 0 |  |          |                      | 0                      |                            |                      |                         | 253,669             |  |  |             | 33,333  |  |               |   | 25,000  |  |  |   | 13,000 | 
|Albert J. Rahm, II     |  |             | 0 |  |          |                      | 0                      |                            |                      |                         | 120,667             |  |  |             | 10,000  |  |               |   | 7,600   |  |  |   | 3,800  | 
|Aida Alvarez           |  |             | 0 |  |          |                      | 0                      |                            |                      |                         | 112,666             |  |  |             | 6,667   |  |               |   | 5,000   |  |  |   | 2,500  | 

180



---



##### Table of Contents





| |                                     
| | ------------------------------------
| | Equity Compensation Plan Information



|                                                       |  |                      |            |  |                      |     |                      |                         |  |  |           | 
|------------------------------------------------------ |  | -------------------- | ---------- |  | -------------------- | --- | -------------------- | ----------------------- |  |  | --------- | 
|                                                       |  |                      |            |  |                      | (C) |                     
|                                                       |  | (A)                  |            |  |                      |     | Number of Securities |                        
|                                                       |  | Number of Securities |            |  | (B)                  |     |                      | Remaining Available for | 
|                                                       |  | to be Issued         |            |  | Weighted-Average     |     |                      | Issuance Under Equity   | 
|                                                       |  | Upon Exercise of     |            |  | Exercise Price of    |     |                      | Compensation Plans      | 
|                                                       |  | Outstanding Options, |            |  | Outstanding Options, |     |                      | (Excluding Securities   | 
|Plan Category                                          |  | Warrants and Rights  |            |  | Warrants and Rights  |     |                      | Reflected in Column (A) | 
|                                                       |  |                      |            |  |                      |     |                      |                         | 
|Equity Compensation plans approved by Stockholders     |  |                      | 10,364,014 |  |                      | $   | 0.76                 |                         |  |  | 3,304,523 | 
|Equity Compensation plans not approved by Stockholders |  |                      | 0          |  |                      |     | 0                    |                         |  |  | 0         | 
|                                                       |  |                      |            |  |                      |     |                      |                         | 
|Total                                                  |  |                      | 10,364,014 |  |                      | $   | 0.76                 |                         |  |  | 3,304,523 | 
|                                                       |  |                      |            |  |                      |     |                      |                         | 



Employment Agreements




| |                       
| | ----------------------
| | Thomas A. Andruskevich









181



---



##### Table of Contents
















| |                    
| | -------------------
| | Michael Rabinovitch














| |                      
| | ---------------------
| | Joseph A. Keifer, III





| |               
| | --------------
| | Marc Weinstein



182



---



##### Table of Contents







| |                   
| | ------------------
| | Albert J. Rahm, II





| |             
| | ------------
| | Aida Alvarez



183



---



##### Table of Contents



Ten-year Option Repricings




Compensation Committee Interlocks and Insider
Participation




Board of Directors Compensation Committee Report on Executive
Compensation






| |                                                                                          
| | -----------------------------------------------------------------------------------------
| | Compensation Committee Report on Chief Executive Officer
    Compensation for Fiscal 2004





| |                      
| | ---------------------
| | Salaries and Benefits





| |        
| | -------
| | Bonuses



184



---



##### Table of Contents







| |              
| | -------------
| | Stock Options







| |                          
| | -------------------------
| | Ann Spector Lieff (Chair)
| | Massimo Ferragamo        
| | Emily Berlin             

185



---



##### Table of Contents



Performance Graph




COMPARISON OF 62 MONTH CUMULATIVE TOTAL RETURN*


AMONG MAYORS JEWELERS, INC., THE AMEX MARKET VALUE
(U.S. & FOREIGN) INDEX


AND THE S & P SPECIALTY STORES INDEX







|  |                                                                                                                           
|- | --------------------------------------------------------------------------------------------------------------------------
|* | $100 invested on 1/31/00 in stock or index-including
    reinvestment of dividends. Indexes calculated on month-end basis.



Comparison of 62 month cumulative total
returns


|                           |  |       |     |                            |  |             |        |           |  |           |        |           |  |   |        |  |  |   |        |  |  |   |        |  | 
|-------------------------- |  | ----- | --- | -------------------------- |  | ----------- | ------ | --------- |  | --------- | ------ | --------- |  | - | ------ |  |  | - | ------ |  |  | - | ------ |  | 
|                           |  |       |     |                            |  |             |        |           |  |           |        |           | 
|                           |  |       |     | For the Fiscal Year Ended, | 
|                           |  |       |     |                            |  |             |        |           |  |           |        |           | 
|                           |  | Base  |     | February 3,                |  | February 2, |        | March 29, |  | March 27, |        | March 26, | 
|Company/Index              |  | Date* |     | 2001                       |  | 2002        |        | 2003      |  | 2004      |        | 2005      | 
|                           |  |       |     |                            |  |             |        |           |  |           |        |           | 
|Mayors                    |  | $     | 100 |                            |  | $           | 121.74 |           |  | $         | 41.39  |           |  | $ | 8.70   |  |  | $ | 25.39  |  |  | $ | 22.96  |  | 
|                           |  |       |     |                            |  |             |        |           |  |           |        |           |  |   |        |  |  |   |        |  |  |   |        |  | 
|NASDAQ Stock Market        |  | $     | 100 |                            |  | $           | 69.82  |           |  | $         | 44.22  |           |  | $ | 24.28  |  |  | $ | 42.45  |  |  | $ | 41.18  |  | 
|                           |  |       |     |                            |  |             |        |           |  |           |        |           |  |   |        |  |  |   |        |  |  |   |        |  | 
|S&P Specialty Stores Index |  | $     | 100 |                            |  | $           | 113.40 |           |  | $         | 142.20 |           |  | $ | 123.01 |  |  | $ | 170.12 |  |  | $ | 184.60 |  | 
|                           |  |       |     |                            |  |             |        |           |  |           |        |           |  |   |        |  |  |   |        |  |  |   |        |  | 



|  |                                                                                                                                 
|- | --------------------------------------------------------------------------------------------------------------------------------
|* | Reflects $100 invested in Mayors common stock and in each
    index, including reinvestment of dividends, January 31,
    2000.

186



---



##### Table of Contents






OWNERSHIP OF MAYORS VOTING SECURITIES







|                                                                 |                                      |                    |            |               |             |  |      |   | 
|---------------------------------------------------------------- | ------------------------------------ | ------------------ | ---------- | ------------- | ----------- |  | ---- | - | 
|                                                                 |                                      |                    |            | Percentage of |            
|Name and Address(1) of                                           |                                      | Number of Shares   |            |               | Outstanding | 
|Beneficial Owner(2)                                              |                                      | Beneficially Owned |            |               | Shares      | 
|                                                                 |                                      |                    |            |               |             | 
|Thomas A. Andruskevich(3)                                        |                                      |                    | 3,009,018  |               |             |  | 7.5  | %
|Aida Alvarez(4)                                                  |                                      |                    | 112,666    |               |             |  | *    |  
|Emily Berlin(5)                                                  |                                      |                    | 550,000    |               |             |  | 1.5  | %
|Elizabeth M. Eveillard(6)                                        |                                      |                    | 1,140,000  |               |             |  | 3.1  | %
|Massimo Ferragamo(7)                                             |                                      |                    | 50,000     |               |             |  | *    |  
|Joseph A. Keifer, III(8)                                         |                                      |                    | 843,339    |               |             |  | 2.2  | %
|Judith MacDonald(9)                                              |                                      |                    | 40,000     |               |             |  | *    |  
|Ann Spector Lieff(10)                                            |                                      |                    | 100,000    |               |             |  | *    |  
|Stephen M. Knopik(11)                                            |                                      |                    | 40,000     |               |             |  | *    |  
|Filippo Recami(12)                                               |                                      |                    | 1,559,018  |               |             |  | 4.0  | %
|Albert J. Rahm, II(13)                                           |                                      |                    | 120,667    |               |             |  | *    |  
|Dr. Lorenzo Rossi di Montelera(14)                               |                                      |                    | 68,053,673 |               |             |  | 75.8 | %
|Marc Weinstein(15)                                               |                                      |                    | 254,019    |               |             |  | *    |  
|All executive officers and directors as a Group (13 persons)(16) |                                      |                    | 75,872,400 |               |             |  | 80.8 | %
|5% Stockholders:                                                 |                                      |                    |            |               |             |  |      |  
|Henry Birks & Sons Inc.(17)                                      |                                      |                    | 68,053,673 |               |             |  | 75.8 | %
|                                                                 | 1240 Phillips Square                 |                    |            |               |             |  |      |   | 
|                                                                 | Montreal, Quebec, Canada H3B 3H4     |                    |            |               |             |  |      |   | 
|Eliahu Ben-Shmuel(18)                                            |                                      |                    | 1,840,101  |               |             |  | 5.0  | %
|                                                                 | 16300 N.E.
    19thAvenue, Suite 206 |                    |            |               |             |  |      |   | 
|                                                                 | Miami Beach, Florida 33162           |                    |            |               |             |  |      |   | 









| |   |                    
| | - | -------------------
| | * | Less than 1 percent



| |     |                                                                                                                                                                                                                                          
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (1) | Unless otherwise provided, the address for each Beneficial
    Owner is 14051 N.W. 14th Street, Suite 200,
    Sunrise, Florida 33323.                                                                                                 
|
| | (2) | Unless otherwise noted, each person has sole voting and
    investment power over the shares listed opposite his or her name.                                                                                                            
|
| | (3) | Includes options to purchase 1,500,000 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days and warrants to
    purchase 1,509,018 shares of Mayors common stock
    at $0.29 per share.
|
| | (4) | Includes options to purchase 112,666 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days.                                                                                               
|
| | (5) | Includes 500,000 shares of Mayors common stock and
    options to purchase 50,000 shares of Mayors
    common stock which are currently exercisable or exercisable
    within 60 days.                                                 

187



---



##### Table of Contents





| |     |                                                                                                                                                                                                                                                                                                                
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (6) | Includes options to purchase 50,000 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days, 90,000 shares held of
    record and 1,000,000 shares in which Mrs. Eveillard
    has an indirect ownership interest through her husband.                            
|
| | (7) | Includes options to purchase 50,000 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days.                                                                                                                                                                      
|
| | (8) | Includes options to purchase 333,333 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days, warrants to
    purchase 503,006 shares of Mayors common stock
    at $0.29 per share, and 7,000 shares in which
    Mr. Keifer has an indirect ownership interest.
|
| | (9) | Includes options to purchase 40,000 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days.                                                                                                                                                                      



|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(10) | Includes 50,000 shares of Mayors common stock and
    options to purchase 50,000 shares of Mayors
    common stock which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    
|(11) | Includes options to purchase 40,000 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    
|(12) | Includes warrants to purchase 1,509,018 shares of
    Mayors common stock at $0.29 per share and options to
    purchase 50,000 shares of Mayors common stock
    which are currently exercisable or exercisable within
    60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    
|(13) | Includes options to purchase 120,667 shares of
    Mayors common stock which are currently exercisable or
    exercisable within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    
|    
|(14) | Includes beneficial indirect ownership of Birks, which holds
    warrants to purchase 901,151 shares of Mayors
    common stock at $0.29 per share, 51,499,525 shares of
    common stock if the Mayors preferred stock is converted,
    15,602,997 shares held of record and direct ownership of
    options to purchase 50,000 shares of Mayors
    common stock which are currently exercisable or exercisable
    within 60 days. Dr. Rossi resigned as a director of
    Mayors effective June 1, 2005.                                                                                                                                                                         
|    
|    
|(15) | Includes 350 shares of Mayors common stock and
    options to purchase 253,669 shares of Mayors
    common stock which are currently exercisable or exercisable
    within 60 days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    
|(16) | Includes 2,700,335 shares issuable upon the exercise of
    stock options for all executive officers and directors,
    1,557,350 shares in which the directors and executive
    officers have an indirect beneficial ownership interest,
    90,000 shares, warrants to
    purchase 3,521,042 shares of Mayors common stock
    at $0.29 per share, as well as the beneficial indirect
    ownership through Birks of 288,517, 306,317 and 306,317 warrants
    to purchase shares of Mayors common stock at $0.29, $0.34
    and $0.39 per share, respectively, 51,499,525 shares
    of Mayors common stock if the Mayors preferred stock
    is converted and 15,602,997 shares.
|    
|    
|(17) | Includes direct ownership of warrants to
    purchase 901,151 shares of Mayors common stock
    at $0.29 per share and 51,499,525 shares of
    Mayors common stock if the Mayors preferred stock is
    converted and 15,602,997 shares. As of March 26, 2005,
    Birks was indirectly controlled by Dr. Lorenzo Rossi di
    Montelera through indirect ownership of Regaluxe Investments
    Sarl and its affiliates.                                                                                                                                                                                                                                                              
|    
|    
|    
|(18) | Includes all shares held by Eliahu Ben-Shmuel, E.P. Family
    Partners, Hay Foundation and Tropical Time, Inc. as reported in
    its Schedule 13D dated as of September 21, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    



188



---



##### Table of Contents






LEGAL MATTERS







EXPERTS











STOCKHOLDER PROPOSALS


th


189



---



##### Table of Contents






ENFORCEABILITY OF CIVIL LIABILITIES







WHERE YOU CAN FIND MORE INFORMATION








190



---



##### Table of Contents






INDEX TO CONSOLIDATED FINANCIAL STATEMENTS OF BIRKS AND
MAYORS





|                                                                                                                                                           |  |  |      | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  | ---- | 
|Henry Birks & Sons Inc. and subsidiaries                                                                                                                   |  |  |      | 
|Report of Independent Registered Public
    Accounting Firm                                                                                                |  |  | F-2  | 
|Consolidated Balance Sheets as of
    March 26, 2005 and March 27, 2004                                                                                    |  |  | F-3  | 
|Consolidated Statements of Operations for
    the years ended March 26, 2005, March 27, 2004 and
    March 29, 2003                                        |  |  | F-4  | 
|Consolidated Statements of
    Stockholders Equity and Comprehensive Income for the years
    ended March 26, 2005, March 27, 2004 and
    March 29, 2003 |  |  | F-5  | 
|Consolidated Statements of Cash Flows for
    the years ended March 26, 2005, March 27, 2004 and
    March 29, 2003                                        |  |  | F-6  | 
|Notes to Consolidated Financial
    Statements                                                                                                             |  |  | F-8  | 
|Mayors Jewelers, Inc. and subsidiaries                                                                                                                    |  |  |      | 
|Report of Independent Registered Public
    Accounting Firm  KPMG LLP                                                                                     |  |  | F-35 | 
|Report of Independent Registered Public
    Accounting Firm  Deloitte & Touche LLP                                                                        |  |  | F-36 | 
|Consolidated Balance Sheets as of
    March 26, 2005 and March 27, 2004                                                                                    |  |  | F-37 | 
|Consolidated Statements of Operations for
    the fiscal years ended March 26, 2005, March 27, 2004
    and March 29, 2003                                 |  |  | F-38 | 
|Consolidated Statements of
    Stockholders Equity for the fiscal years ended
    March 26, 2005, March 27, 2004 and March 29,
    2003                   |  |  | F-39 | 
|Consolidated Statements of Cash Flows for
    the fiscal years ended March 26, 2005, March 27, 2004
    and March 29, 2003                                 |  |  | F-40 | 
|Notes to Consolidated Financial
    Statements                                                                                                             |  |  | F-41 | 
|Consolidated Condensed Balance
    Sheets  Unaudited as of June 25, 2005 and
    March 26, 2005                                                           |  |  | F-60 | 
|Consolidated Condensed Statements of
    Operations  Unaudited for the thirteen weeks ended
    June 25, 2005 and June 26, 2004                           |  |  | F-61 | 
|Consolidated Condensed Statements of Cash
    Flows  Unaudited for the thirteen weeks ended
    June 25, 2005 and June 26, 2004                           |  |  | F-62 | 
|Notes to Consolidated Condensed Financial
    Statements  Unaudited                                                                                       |  |  | F-63 | 




F-1



---









REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM














| |             
| | ------------
| | -s- KPMG LLP





| |                      
| | ---------------------
| | Chartered Accountants









F-2



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES





Consolidated Balance Sheets


March 26, 2005 and March 27, 2004


|                                                                           |                                                                                                    |                          |         |         |      |   |         |         |  
|-------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------- | ------------------------ | ------- | ------- | ---- | - | ------- | ------- | -
|                                                                           |                                                                                                    | 2005                     |         |         | 2004 |  
|                                                                           |                                                                                                    |                          |         |         |      |  
|                                                                           |                                                                                                    | (Amounts shown in        |        
|                                                                           |                                                                                                    | thousands of US dollars) |        
|ASSETS                                                                    
|Current assets:                                                            |                                                                                                    |                          |         |         |      |   |         |        
|                                                                           | Cash and cash equivalents                                                                          |                          | $       | 1,762   |      |   | $       | 1,656   |  
|                                                                           | Accounts receivable (net of allowance for doubtful accounts of
    $1,015; 2004 - $1,086) (note 4) |                          |         | 9,805   |      |   |         | 8,272   |  
|                                                                           | Inventories (note 5)                                                                               |                          |         | 136,999 |      |   |         | 134,422 |  
|                                                                           | Other current assets                                                                               |                          |         | 2,951   |      |   |         | 3,162   |  
|                                                                           |                                                                                                    |                          |         |         |      |  
|                                                                           | Total current assets                                                                               |                          |         | 151,517 |      |   |         | 147,512 |  
|Property and equipment, net (note 6)                                       |                                                                                                    |                          | 30,117  |         |      |   | 29,108  |        
|Goodwill                                                                   |                                                                                                    |                          | 15,463  |         |      |   | 15,365  |        
|Intangible assets, net of accumulated amortization of $35 (2004
    - $17) |                                                                                                    |                          | 262     |         |      |   | 216     |        
|Other assets                                                               |                                                                                                    |                          | 2,362   |         |      |   | 1,179   |        
|                                                                           |                                                                                                    |                          |         |         |      |  
|Total assets                                                               |                                                                                                    | $                        | 199,721 |         |      | $ | 193,380 |        
|                                                                           |                                                                                                    |                          |         |         |      |  
|                                                                          
|LIABILITIES AND STOCKHOLDERS EQUITY                                      
|                                                                          
|Current liabilities:                                                       |                                                                                                    |                          |         |         |      |   |         |        
|                                                                           | Bank indebtedness (note 7)                                                                         |                          | $       | 74,254  |      |   | $       | 70,262  |  
|                                                                           | Accounts payable                                                                                   |                          |         | 22,571  |      |   |         | 21,220  |  
|                                                                           | Accrued liabilities                                                                                |                          |         | 11,665  |      |   |         | 11,409  |  
|                                                                           | Other taxes payable                                                                                |                          |         | 3,633   |      |   |         | 6,177   |  
|                                                                           | Loans for leasehold improvements and term loans (note 8)                                           |                          |         | 1,262   |      |   |         | 2,725   |  
|                                                                           | Current portion of long-term debt (note 9)                                                         |                          |         | 3,076   |      |   |         | 989     |  
|                                                                           |                                                                                                    |                          |         |         |      |  
|                                                                           | Total current liabilities                                                                          |                          |         | 116,461 |      |   |         | 112,782 |  
|Long-term debt (note 9)                                                    |                                                                                                    |                          | 28,555  |         |      |   | 28,563  |        
|Convertible notes (note 10)                                                |                                                                                                    |                          | 5,000   |         |      |   | 5,000   |        
|Other long-term liabilities                                                |                                                                                                    |                          | 4,456   |         |      |   | 4,797   |        
|Minority interest                                                          |                                                                                                    |                          | 1       |         |      |   | 1       |        
|                                                                           |                                                                                                    |                          |         |         |      |  
|Total liabilities                                                          |                                                                                                    |                          | 154,473 |         |      |   | 151,143 |        
|Convertible preferred stock (note 16)                                      |                                                                                                    |                          | 5,050   |         |      |   | 10,050  |        
|Stockholders equity:                                                      |                                                                                                    |                          |         |         |      |   |         |        
|                                                                           | Common stock (note 16)                                                                             |                          |         | 36,364  |      |   |         | 31,405  |  
|                                                                           | Additional paid-in capital                                                                         |                          |         | 16,867  |      |   |         | 15,518  |  
|                                                                           | Accumulated deficit                                                                                |                          |         | (13,760 | )    |   |         | (14,927 | )
|                                                                           | Accumulated other comprehensive income                                                             |                          |         | 727     |      |   |         | 191     |  
|                                                                           |                                                                                                    |                          |         |         |      |  
|                                                                           | Total stockholders equity                                                                         |                          |         | 40,198  |      |   |         | 32,187  |  
|Commitments and contingencies (notes 17 and 18)                            |                                                                                                    |                          |         |         |      |   |         |        
|                                                                           |                                                                                                    |                          |         |         |      |  
|Total liabilities and stockholders equity                                 |                                                                                                    | $                        | 199,721 |         |      | $ | 193,380 |        
|                                                                           |                                                                                                    |                          |         |         |      |  



F-3



---



##### Table of Contents



HENRY BIRKS AND SONS INC. AND SUBSIDIARIES





Consolidated Statements of Operations


Years ended March 26, 2005, March 27, 2004 and
March 29, 2003


|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |   |   |         |       |  
|--------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------- | ------------------------------ | ------- | ----- | ---- | - | ------- | ----- | - | - | ------- | ----- | -
|                                                                                                                                  |                                              | 2005                           |         |       | 2004 |   |         | 2003  |  
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|                                                                                                                                  |                                              | (Amounts shown in thousands of |        
|                                                                                                                                  |                                              | US dollars)                    |        
|Net sales                                                                                                                         |                                              | $                              | 239,301 |       |      | $ | 216,256 |       |   | $ | 151,312 |      
|Cost of sales, including depreciation of $440, $307 and $220                                                                      |                                              |                                | 130,037 |       |      |   | 118,861 |       |   |   | 83,698  |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Gross profit                                                                                                                      |                                              |                                | 109,264 |       |      |   | 97,395  |       |   |   | 67,614  |      
|Selling, general and administrative expenses (including non-cash
    compensation expense of $599, $1,745 and $66)                |                                              |                                | 95,764  |       |      |   | 93,638  |       |   |   | 63,890  |      
|Depreciation and amortization                                                                                                     |                                              |                                | 4,749   |       |      |   | 4,312   |       |   |   | 3,256   |      
|Other items                                                                                                                       |                                              |                                | (1,181  | )     |      |   | 338     |       |   |   | (210    | )    
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Total operating expenses                                                                                                          |                                              |                                | 99,332  |       |      |   | 98,288  |       |   |   | 66,936  |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Operating income (loss)                                                                                                           |                                              |                                | 9,932   |       |      |   | (893    | )     |   |   | 678     |      
|Other expenses (income):                                                                                                          |                                              |                                |         |       |      |   |         |       |   |   |         |      
|                                                                                                                                  | Interest on long-term debt                   |                                |         | 2,906 |      |   |         | 2,858 |   |   |         | 2,448 |  
|                                                                                                                                  | Interest and other financial costs           |                                |         | 5,759 |      |   |         | 5,312 |   |   |         | 3,486 |  
|                                                                                                                                  | (Gain) loss on sale of Mayors common shares |                                |         | (232  | )    |   |         | 176   |   |   |         |      |  
|                                                                                                                                  | Loss on disposal of Mayors warrants         |                                |         | 332   |      |   |         | 334   |   |   |         | 312   |  
|                                                                                                                                  | Interest and other income                    |                                |         |      |      |   |         | (184  | ) |   |         | (389  | )
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|                                                                                                                                  |                                              |                                | 8,765   |       |      |   | 8,496   |       |   |   | 5,857   |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Income (loss) from continuing operations before income tax,
    minority interest, discontinued operations and extraordinary item |                                              |                                | 1,167   |       |      |   | (9,389  | )     |   |   | (5,179  | )    
|Income tax benefit                                                                                                                |                                              |                                |        |       |      |   |        |       |   |   | 991     |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Income (loss) from continuing operations before minority
    interest, discontinued operations and extraordinary item             |                                              |                                | 1,167   |       |      |   | (9,389  | )     |   |   | (4,188  | )    
|Minority interest in loss of subsidiary (note 2)                                                                                  |                                              |                                |        |       |      |   | 7,175   |       |   |   | 8,071   |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Income (loss) from continuing operations before discontinued
    operations and extraordinary item                                |                                              |                                | 1,167   |       |      |   | (2,214  | )     |   |   | 3,883   |      
|Loss from discontinued operations, net of income tax of nil
    (note 12)                                                         |                                              |                                |        |       |      |   |        |       |   |   | (828    | )    
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Income (loss) before extraordinary item                                                                                           |                                              |                                | 1,167   |       |      |   | (2,214  | )     |   |   | 3,055   |      
|Extraordinary gain, net of income tax of nil (note 2)                                                                             |                                              |                                |        |       |      |   |        |       |   |   | 9,042   |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  
|Net income (loss) attributable to common stockholders                                                                             |                                              | $                              | 1,167   |       |      | $ | (2,214  | )     |   | $ | 12,097  |      
|                                                                                                                                  |                                              |                                |         |       |      |   |         |       |  



F-4



---



##### Table of Contents



HENRY BIRKS AND SONS INC. AND SUBSIDIARIES





Consolidated Statements of Stockholders Equity and
Comprehensive Income


Years ended March 26, 2005, March 27, 2004 and
March 29, 2003


|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |   |      |   |  |   |        |  
|-------------------------------------------------------------- |  | ------------------------------------------ | --------- | - | ------ | - | ------ | ---------- |  | - | ----------- | - | ------------- | ------------- | ------- | - | ----- | - | ---- | - |  | - | ------ | -
|                                                               |  | Voting                                     |           |   |        |   |        |            |  |   | Accumulated |   |               |              
|                                                               |  | Common                                     |           |   | Voting |   |        | Additional |  |   |             |   | Other         |               |         |  
|                                                               |  | Stock                                      |           |   | Common |   |        | Paid-in    |  |   |             |   | Comprehensive |               |         |  
|                                                               |  | Outstanding                                |           |   | Stock  |   |        | Capital    |  |   | Deficit     |   |               | Income (Loss) |         |   | Total |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|                                                               |  | (Amounts shown in thousands of US dollars) |          
|Balance at March 30, 2002                                      |  |                                            | 6,313,308 |   |        | $ | 31,405 |            |  | $ | 356         |   |               | $             | (23,743 | ) |       | $ | (465 | ) |  | $ | 7,553  |  
|Net income                                                     |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               | 12,097  |   |       |   |     |   |  |   | 12,097 |  
|Cumulative translation adjustment                              |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               |        |   |       |   | 317  |   |  |   | 317    |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|Total comprehensive income                                     |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               |        |   |       |   |     |   |  |   | 12,414 |  
|Compensation resulting from warrants granted to management     |  |                                            |          |   |        |   |       |            |  |   | 312         |   |               |               |        |   |       |   |     |   |  |   | 312    |  
|Purchase accounting adjustment                                 |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               | (1,067  | ) |       |   |     |   |  |   | (1,067 | )
|Stock options granted to management and non-employees          |  |                                            |          |   |        |   |       |            |  |   | 66          |   |               |               |        |   |       |   |     |   |  |   | 66     |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|Balance at March 29, 2003                                      |  |                                            | 6,313,308 |   |        |   | 31,405 |            |  |   | 734         |   |               |               | (12,713 | ) |       |   | (148 | ) |  |   | 19,278 |  
|Net loss                                                       |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               | (2,214  | ) |       |   |     |   |  |   | (2,214 | )
|Cumulative translation adjustment                              |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               |        |   |       |   | 339  |   |  |   | 339    |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|Total comprehensive loss                                       |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               |        |   |       |   |     |   |  |   | (1,875 | )
|Compensation resulting from warrants granted to management     |  |                                            |          |   |        |   |       |            |  |   | 1,070       |   |               |               |        |   |       |   |     |   |  |   | 1,070  |  
|Exercise of Mayors warrants, purchase accounting
    (note 2) |  |                                            |          |   |        |   |       |            |  |   | 13,292      |   |               |               |        |   |       |   |     |   |  |   | 13,292 |  
|Stock options granted to a lender                              |  |                                            |          |   |        |   |       |            |  |   | 331         |   |               |               |        |   |       |   |     |   |  |   | 331    |  
|Compensation resulting from sale of shares to related parties  |  |                                            |          |   |        |   |       |            |  |   | 88          |   |               |               |        |   |       |   |     |   |  |   | 88     |  
|Stock options granted to management and non-employees          |  |                                            |          |   |        |   |       |            |  |   | 3           |   |               |               |        |   |       |   |     |   |  |   | 3      |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|Balance at March 27, 2004                                      |  |                                            | 6,313,308 |   |        |   | 31,405 |            |  |   | 15,518      |   |               |               | (14,927 | ) |       |   | 191  |   |  |   | 32,187 |  
|Net income                                                     |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               | 1,167   |   |       |   |     |   |  |   | 1,167  |  
|Cumulative translation adjustment                              |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               |        |   |       |   | 536  |   |  |   | 536    |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|Total comprehensive income                                     |  |                                            |          |   |        |   |       |            |  |   |            |   |               |               |        |   |       |   |     |   |  |   | 1,703  |  
|Compensation resulting from warrants granted to management     |  |                                            |          |   |        |   |       |            |  |   | 278         |   |               |               |        |   |       |   |     |   |  |   | 278    |  
|Compensation resulting from sale of shares to related parties  |  |                                            |          |   |        |   |       |            |  |   | 135         |   |               |               |        |   |       |   |     |   |  |   | 135    |  
|Stock options granted to management and non-employees          |  |                                            |          |   |        |   |       |            |  |   | 550         |   |               |               |        |   |       |   |     |   |  |   | 550    |  
|Stock options granted to a lender                              |  |                                            |          |   |        |   |       |            |  |   | 419         |   |               |               |        |   |       |   |     |   |  |   | 419    |  
|Repurchase of shares                                           |  |                                            | (10,290   | ) |        |   | (41    | )          |  |   | (33         | ) |               |               |        |   |       |   |     |   |  |   | (74    | )
|Conversion of common and preferred shares (note 16(b))         |  |                                            | 995,526   |   |        |   | 5,000  |            |  |   |            |   |               |               |        |   |       |   |     |   |  |   | 5,000  |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  
|Balance at March 26, 2005                                      |  |                                            | 7,298,544 |   |        | $ | 36,364 |            |  | $ | 16,867      |   |               | $             | (13,760 | ) |       | $ | 727  |   |  | $ | 40,198 |  
|                                                               |  |                                            |           |   |        |   |        |            |  |   |             |   |               |               |         |   |       |  



F-5



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES





Consolidated Statements of Cash Flows


Years ended March 26, 2005, March 27, 2004 and
March 29, 2003


|                                      |                                                                                               |                                                           |                                                     |        |       |        |   |        |        |        |   |         |        |         |  
|------------------------------------- | --------------------------------------------------------------------------------------------- | --------------------------------------------------------- | --------------------------------------------------- | ------ | ----- | ------ | - | ------ | ------ | ------ | - | ------- | ------ | ------- | -
|                                      |                                                                                               | 2005                                                      |                                                     |        | 2004  |        |   | 2003   |       
|                                      |                                                                                               |                                                           |                                                     |        |       |        |   |        |       
|                                      |                                                                                               | (Amounts shown in thousands of                            |                                                    
|                                      |                                                                                               | US dollars)                                               |                                                    
|Cash flows from operating activities: |                                                                                               |                                                           |                                                     |        |       |        |   |        |        |        |   |        
|                                      | Net income (loss)                                                                             |                                                           | $                                                   | 1,167  |       |        | $ | (2,214 | )      |        | $ | 12,097  |       
|                                      | Adjustments to reconcile net loss to net cash (used in) provided
    by operating activities: |                                                           |                                                     |        |       |        |   |        |        |        |   |         |       
|                                      |                                                                                               | Extraordinary gain                                        |                                                     |        |      |        |   |        |       |        |   |         | (9,042 | )      
|                                      |                                                                                               | Minority interest in loss of subsidiary                   |                                                     |        |      |        |   |        | (7,175 | )      |   |         | (8,071 | )      
|                                      |                                                                                               | Depreciation and amortization                             |                                                     |        | 5,172 |        |   |        | 4,611  |        |   |         | 3,473  |        
|                                      |                                                                                               | Amortization of debt costs                                |                                                     |        | 688   |        |   |        | 484    |        |   |         | 193    |        
|                                      |                                                                                               | Amortization of intangible assets                         |                                                     |        | 17    |        |   |        | 8      |        |   |         | 3      |        
|                                      |                                                                                               | Unrealized foreign exchange gain on convertible notes     |                                                     |        | (401  | )      |   |        | (552   | )      |   |         | (314   | )      
|                                      |                                                                                               | Loss on disposal of private label credit card receivables |                                                     |        |      |        |   |        |       |        |   |         | 412    |        
|                                      |                                                                                               | Loss on disposal of warrants                              |                                                     |        | 332   |        |   |        | 334    |        |   |         | 312    |        
|                                      |                                                                                               | Non-cash compensation expense                             |                                                     |        | 957   |        |   |        | 1,745  |        |   |         | 66     |        
|                                      |                                                                                               | Net proceeds from sale of private label credit cards      |                                                     |        |      |        |   |        |       |        |   |         | 12,147 |        
|                                      |                                                                                               | (Gain) loss on sale of Mayors shares                     |                                                     |        | (232  | )      |   |        | 176    |        |   |         |       |        
|                                      |                                                                                               | Gain on sale of property and equipment                    |                                                     |        | (114  | )      |   |        | (66    | )      |   |         |       |        
|                                      |                                                                                               | Write-off of leasehold improvements                       |                                                     |        | 127   |        |   |        |       |        |   |         |       |        
|                                      |                                                                                               | Accretion of interest on sale-leaseback obligation        |                                                     |        | 65    |        |   |        | 128    |        |   |         | 121    |        
|                                      |                                                                                               | (Increase) decrease in:                                   |                                                     |        |       |        |   |        |        |        |   |         |        |        
|                                      |                                                                                               |                                                           | Accounts receivable                                 |        |       | (1,338 | ) |        |        | 464    |   |         |        | (1,505  | )
|                                      |                                                                                               |                                                           | Inventories                                         |        |       | 1,994  |   |        |        | (3,065 | ) |         |        | (13,655 | )
|                                      |                                                                                               |                                                           | Other current assets                                |        |       | 374    |   |        |        | 1,935  |   |         |        | (993    | )
|                                      |                                                                                               | Increase (decrease) in:                                   |                                                     |        |       |        |   |        |        |        |   |         |        |        
|                                      |                                                                                               |                                                           | Accrued liabilities and other long-term liabilities |        |       | (54    | ) |        |        | 1,881  |   |         |        | (7,807  | )
|                                      |                                                                                               |                                                           | Accounts payable                                    |        |       | 470    |   |        |        | (1,651 | ) |         |        | 1,658   |  
|                                      |                                                                                               |                                                           | Other taxes payable                                 |        |       | (2,869 | ) |        |        | (66    | ) |         |        | 472     |  
|                                      |                                                                                               |                                                           |                                                     |        |       |        |   |        |       
|                                      | Net cash provided by (used in) continuing operations                                          |                                                           |                                                     | 6,355  |       |        |   | (3,023 | )      |        |   | (10,433 | )     
|                                      | Loss from discontinued operations                                                             |                                                           |                                                     |       |       |        |   |       |        |        |   | 828     |       
|                                      | Net cash used in discontinued operations                                                      |                                                           |                                                     |       |       |        |   | (527   | )      |        |   | (408    | )     
|                                      |                                                                                               |                                                           |                                                     |        |       |        |   |        |       
|                                      | Net cash provided by (used in) operations                                                     |                                                           |                                                     | 6,355  |       |        |   | (3,550 | )      |        |   | (10,013 | )     
|Cash flows from investing activities: |                                                                                               |                                                           |                                                     |        |       |        |   |        |        |        |   |        
|                                      | Additions to property and equipment                                                           |                                                           |                                                     | (3,679 | )     |        |   | (3,749 | )      |        |   | (4,008  | )     
|                                      | Additions to intangible assets                                                                |                                                           |                                                     | (58    | )     |        |   | (14    | )      |        |   | (4      | )     
|                                      | Additions to other assets                                                                     |                                                           |                                                     | (1,725 | )     |        |   | (364   | )      |        |   | (79     | )     
|                                      | Costs of acquisition of subsidiary                                                            |                                                           |                                                     |       |       |        |   |       |        |        |   | (449    | )     
|                                      | Net proceeds from sale of property and equipment                                              |                                                           |                                                     | 190    |       |        |   | 74     |        |        |   |        |       
|                                      | Net proceeds from disposal of Mayors shares                                                  |                                                           |                                                     | 349    |       |        |   | 484    |        |        |   |        |       
|                                      |                                                                                               |                                                           |                                                     |        |       |        |   |        |       
|                                      | Net cash used in investing activities                                                         |                                                           |                                                     | (4,923 | )     |        |   | (3,569 | )      |        |   | (4,540  | )     

F-6



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Consolidated Statements of Cash
Flows  (Continued)


|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |     |   |       |        |     | 
|------------------------------------------------- | ------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------- | ----- | ------ | ----- | - | ----- | ------ | --- | - | ----- | ------ | --- | 
|                                                  |                                                                           | 2005                                                                                      |       |        | 2004  |   |       | 2003   |    
|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |    
|                                                  |                                                                           | (Amounts shown in thousands of                                                            |      
|                                                  |                                                                           | US dollars)                                                                               |      
|Cash flows from financing activities:             |                                                                           |                                                                                           |       |        |       |   |       |        |     |   |       |       
|                                                  | Increase (decrease) in bank indebtedness                                  |                                                                                           | $     | 737    |       |   | $     | (1,453 | )   |   | $     | 4,178  |    
|                                                  | Proceeds from loans for leasehold improvements and term loans             |                                                                                           |       |       |       |   |       |       |     |   |       | 630    |    
|                                                  | Repayment of loans for leasehold improvements and term loans              |                                                                                           |       | (1,604 | )     |   |       | (1,701 | )   |   |       | (1,488 | )  
|                                                  | Repayment of obligations under capital leases                             |                                                                                           |       | (241   | )     |   |       | (305   | )   |   |       | (207   | )  
|                                                  | Repurchase of capital stock                                               |                                                                                           |       | (74    | )     |   |       |       |     |   |       |       |    
|                                                  | Proceeds from employee stock plans                                        |                                                                                           |       | 16     |       |   |       |       |     |   |       |       |    
|                                                  | Proceeds from issuance of preferred shares                                |                                                                                           |       |       |       |   |       |       |     |   |       | 10,050 |    
|                                                  | Proceeds from issuance of convertible notes                               |                                                                                           |       |       |       |   |       |       |     |   |       | 5,000  |    
|                                                  | Repayment of long-term debt                                               |                                                                                           |       | (672   | )     |   |       | (4,026 | )   |   |       |       |    
|                                                  | Repayment of loan payable to shareholder                                  |                                                                                           |       | (168   | )     |   |       | (152   | )   |   |       | (133   | )  
|                                                  | Proceeds from long-term debt                                              |                                                                                           |       | 99     |       |   |       | 5,175  |     |   |       |       |    
|                                                  | Net increase (decrease) in borrowings under line of credit of
    Mayors |                                                                                           |       | 496    |       |   |       | 9,722  |     |   |       | (3,296 | )  
|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |    
|                                                  | Net cash (used in) provided by financing activities                       |                                                                                           |       | (1,411 | )     |   |       | 7,260  |     |   |       | 14,734 |    
|Effect of exchange rate on cash                   |                                                                           |                                                                                           | 85    |        |       |   | 33    |        |     |   | 37    |       
|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |    
|Net increase in cash and cash equivalents         |                                                                           |                                                                                           | 106   |        |       |   | 174   |        |     |   | 218   |       
|Cash of subsidiary acquired                       |                                                                           |                                                                                           |      |        |       |   |      |        |     |   | 752   |       
|Cash and cash equivalents, beginning of year      |                                                                           |                                                                                           | 1,656 |        |       |   | 1,482 |        |     |   | 512   |       
|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |    
|Cash and cash equivalents, end of year            |                                                                           | $                                                                                         | 1,762 |        |       | $ | 1,656 |        |     | $ | 1,482 |       
|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |    
|Supplemental disclosure of cash flow information: |                                                                           |                                                                                           |       |        |       |   |       |        |     |   |       |       
|                                                  | Interest paid                                                             |                                                                                           | $     | 7,563  |       |   | $     | 8,187  |     |   | $     | 5,344  |    
|                                                  | Non-cash transactions from investing activities:                          |                                                                                           |       |        |       |   |       |        |     |   |       |        |    
|                                                  |                                                                           | Property and equipment additions acquired through capital leases                          |       |        | 1,600 |   |       |        | 372 |   |       |        | 156 | 
|                                                  |                                                                           | Property and equipment additions included in accounts payable
    and accrued liabilities |       |        | 9     |   |       |        | 664 |   |       |        | 632 | 
|                                                  |                                                                           |                                                                                           |       |        |       |   |       |        |    



F-7



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES





Notes to Consolidated Financial Statements


Years ended March 26, 2005, March 27, 2004 and
March 29, 2003




,




|   |                       
|-- | ----------------------
|1. | Basis of presentation:





|   |                           
|-- | --------------------------
|2. | Acquisition of subsidiary:







F-8



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|                                                         |             |                    |         |        | 
|-------------------------------------------------------- | ----------- | ------------------ | ------- | ------ | 
|                                                         |             | (Amounts in 000s) |        
|Current assets:                                          |             |                    |         |       
|                                                         | Inventories |                    | $       | 48,700 | 
|                                                         | Other       |                    |         | 17,800 | 
|                                                         |             |                    |        
|                                                         |             |                    | 66,500  |       
|Property and equipment                                   |             |                    | 12,207  |       
|Other                                                    |             |                    | 593     |       
|                                                         |             |                    |        
|                                                         |             |                    | 79,300  |       
|Less current liabilities                                 |             |                    | (40,922 | )     
|Other liabilities                                        |             |                    | (2,700  | )     
|                                                         |             |                    |        
|                                                         |             |                    | (43,622 | )     
|                                                         |             |                    |        
|                                                         |             |                    | 35,678  |       
|Deduct 71.9% of the fair value assigned to the warrants  |             |                    | (2,730  | )     
|                                                         |             |                    |        
|                                                         |             |                    | 32,948  |       
|Consideration paid including expenses of $449            |             |                    | (11,699 | )     
|                                                         |             |                    |        
|Negative goodwill                                        |             | $                  | 21,249  |       
|                                                         |             |                    |        
|The negative goodwill has been accounted for as follows: |             |                    |         |       
|Property and equipment written down                      |             | $                  | 12,207  |       
|Extraordinary gain                                       |             |                    | 9,042   |       
|                                                         |             |                    |        
|                                                         |             | $                  | 21,249  |       
|                                                         |             |                    |        





F-9



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|                          |             |                    |        |       | 
|------------------------- | ----------- | ------------------ | ------ | ----- | 
|                          |             | (Amounts in 000s) |       
|Current assets:           |             |                    |        |      
|                          | Inventories |                    | $      | 5,100 | 
|                          | Other       |                    |        | 500   | 
|                          |             |                    |       
|                          |             |                    | 5,600  |      
|Property and equipment    |             |                    | 800    |      
|Goodwill                  |             |                    | 13,124 |      
|Trade name and trademarks |             |                    | 168    |      
|                          |             |                    |       
|                          |             |                    | 19,692 |      
|Less current liabilities  |             |                    | (5,500 | )    
|Other liabilities         |             |                    | (900   | )    
|                          |             |                    |       
|                          |             |                    | (6,400 | )    
|                          |             |                    |       
|Consideration paid        |             | $                  | 13,292 |      
|                          |             |                    |       





















F-10



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)








|   |                                 
|-- | --------------------------------
|3. | Significant accounting policies:



|    |                     
|--- | --------------------
|(a) | Revenue recognition:











|    |               
|--- | --------------
|(b) | Cost of sales:





|    |                           
|--- | --------------------------
|(c) | Cash and cash equivalents:





|    |                     
|--- | --------------------
|(d) | Accounts receivable:



F-11



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|    |             
|--- | ------------
|(e) | Inventories:







|    |                        
|--- | -----------------------
|(f) | Property and equipment:



|                        |  |        |                                   | 
|----------------------- |  | ------ | --------------------------------- | 
|Asset                   |  | Period |                                  
|                        |  |        |                                  
|Building                |  |        | 20 years                          | 
|Leasehold improvements  |  |        | Lower of term of the              | 
|                        |  |        | lease or the useful life of asset | 
|Software                |  |        | 3-7 years                         | 
|Electronic equipment    |  |        | 3-10 years                        | 
|Molds                   |  |        | 5-25 years                        | 
|Furniture and fixtures  |  |        | 5-8 years                         | 
|Manufacturing equipment |  |        | 8 years                           | 
|Automobiles and trucks  |  |        | 3 years                           | 



|    |                                
|--- | -------------------------------
|(g) | Goodwill and intangible assets:



















|    |                          
|--- | -------------------------
|(h) | Deferred financing costs:



F-12



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|    |                  
|--- | -----------------
|(i) | Warranty accrual:





|    |              
|--- | -------------
|(j) | Income taxes:

Accounting for Income Taxes.




|    |                  
|--- | -----------------
|(k) | Foreign exchange:







|    |                          
|--- | -------------------------
|(l) | Stock-Based Compensation:

Accounting for Stock Issued to Employees Accounting for
Stock-Based Compensation Accounting for Stock-Based
Compensation  Transition and Disclosure


|                                                                                                                  |  |                    |       |   |      |   |        |      |  |   |        |  
|----------------------------------------------------------------------------------------------------------------- |  | ------------------ | ----- | - | ---- | - | ------ | ---- |  | - | ------ | -
|                                                                                                                  |  | 2005               |       |   | 2004 |   |        | 2003 | 
|                                                                                                                  |  |                    |       |   |      |   |        |      | 
|                                                                                                                  |  | (Amounts in 000s) |      
|Net income (loss) as reported                                                                                     |  | $                  | 1,167 |   |      | $ | (2,214 | )    |  | $ | 12,097 |  
|Employee compensation expense recorded                                                                            |  |                    | 450   |   |      |   | 1,235  |      |  |   | 66     |  
|                                                                                                                  |  |                    |       |   |      |   |        |      | 
|Adjusted net income (loss)                                                                                        |  |                    | 1,617 |   |      |   | (979   | )    |  |   | 12,163 |  
|Stock-based employee compensation expense determined under
    fair-value based method for all awards, net of tax |  |                    | (447  | ) |      |   | (1,249 | )    |  |   | (531   | )
|                                                                                                                  |  |                    |       |   |      |   |        |      | 
|Proforma net income (loss)                                                                                        |  | $                  | 1,170 |   |      | $ | (2,228 | )    |  | $ | 11,632 |  
|                                                                                                                  |  |                    |       |   |      |   |        |      | 

F-13



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)










|    |                  
|--- | -----------------
|(m) | Use of estimates:





|    |                   
|--- | ------------------
|(n) | Long-lived assets:





|    |                   
|--- | ------------------
|(o) | Advertising costs:



F-14



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|    |                      
|--- | ---------------------
|(p) | Pre-opening expenses:





|    |                             
|--- | ----------------------------
|(q) | Comprehensive income (loss):





|    |                  
|--- | -----------------
|(r) | Operating leases:





|    |                                   
|--- | ----------------------------------
|(s) | Newly issued accounting standards:

Share-Based Payments Accounting
for Stock Issued to Employees


Inventory Costs Inventory Pricing Restatement and Revision of
Accounting Research Bulletins.


Exchanges of Non-Monetary Assets  an Amendment of
APB Opinion No. 29 Accounting for
Non-Monetary Exchanges


F-15



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)


Accounting for Conditional Asset
Retirement Obligation


Accounting Changes and Error Corrections  a
replacement of APB Opinion No. 20 and FASB Statement
No. 3. Accounting Changes Reporting Accounting Changes in Interim Financial
Statements




|   |                     
|-- | --------------------
|4. | Accounts receivable:



|      |  |                    |       |  |      |   |       | 
|----- |  | ------------------ | ----- |  | ---- | - | ----- | 
|      |  | 2005               |       |  | 2004 |  
|      |  |                    |       |  |      |  
|      |  | (Amounts in 000s) |      
|Trade |  | $                  | 8,756 |  |      | $ | 7,506 | 
|Other |  |                    | 1,049 |  |      |   | 766   | 
|      |  |                    |       |  |      |  
|      |  | $                  | 9,805 |  |      | $ | 8,272 | 
|      |  |                    |       |  |      |  



|                              |  |                    |        |   |               |   |         |  
|----------------------------- |  | ------------------ | ------ | - | ------------- | - | ------- | -
|                              |  | Allowance for      |        |   | Allowance for |  
|                              |  | Doubtful Accounts  |        |   | Sales Returns |  
|                              |  |                    |        |   |               |  
|                              |  | (Amounts in 000s) |       
|Balance March 30, 2002        |  | $                  | 50     |   |               | $ | 47      |  
|Additional provision recorded |  |                    | 2,324  |   |               |   | 8,379   |  
|Deductions                    |  |                    | (1,031 | ) |               |   | (8,025  | )
|                              |  |                    |        |   |               |  
|Balance March 29, 2003        |  |                    | 1,343  |   |               |   | 401     |  
|Additional provision recorded |  |                    | 221    |   |               |   | 10,075  |  
|Deductions                    |  |                    | (478   | ) |               |   | (10,207 | )
|                              |  |                    |        |   |               |  
|Balance March 27, 2004        |  |                    | 1,086  |   |               |   | 269     |  
|Additional provision recorded |  |                    | 127    |   |               |   | 11,675  |  
|Deductions                    |  |                    | (198   | ) |               |   | (11,643 | )
|                              |  |                    |        |   |               |  
|Balance March 26, 2005        |  | $                  | 1,015  |   |               | $ | 301     |  
|                              |  |                    |        |   |               |  



F-16



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)






|   |             
|-- | ------------
|5. | Inventories:



|                                                   |  |                    |         |  |      |   |         | 
|-------------------------------------------------- |  | ------------------ | ------- |  | ---- | - | ------- | 
|                                                   |  | 2005               |         |  | 2004 |  
|                                                   |  |                    |         |  |      |  
|                                                   |  | (Amounts in 000s) |        
|Raw materials                                      |  | $                  | 4,409   |  |      | $ | 5,907   | 
|Work in progress                                   |  |                    | 1,910   |  |      |   | 1,178   | 
|Retail inventories and manufactured finished goods |  |                    | 130,680 |  |      |   | 127,337 | 
|                                                   |  |                    |         |  |      |  
|                                                   |  | $                  | 136,999 |  |      | $ | 134,422 | 
|                                                   |  |                    |         |  |      |  





|   |                        
|-- | -----------------------
|6. | Property and equipment:



|                                  |  |                    |        |                  |              |   |          |       |  |   |             |                  |  |              |          |  |       |   |        |  |  |   |        | 
|--------------------------------- |  | ------------------ | ------ | ---------------- | ------------ | - | -------- | ----- |  | - | ----------- | ---------------- |  | ------------ | -------- |  | ----- | - | ------ |  |  | - | ------ | 
|                                  |  | 2005               |        |                  | 2004         |  
|                                  |  |                    |        |                  |              |  
|                                  |  |                    |        | Accumulated      |              |   |          |       |  |   | Accumulated |                  |  |             
|                                  |  |                    |        | Depreciation and |              |   | Net Book |       |  |   |             | Depreciation and |  |              | Net Book | 
|                                  |  | Cost               |        |                  | Amortization |   |          | Value |  |   | Cost        |                  |  | Amortization |          |  | Value |  
|                                  |  |                    |        |                  |              |   |          |       |  |   |             |                  |  |              |          |  |       |  
|                                  |  | (Amounts in 000s) |       
|Land                              |  | $                  | 5,663  |                  |              | $ |         |       |  | $ | 5,663       |                  |  | $            | 4,994    |  |       | $ |       |  |  | $ | 4,994  | 
|Buildings                         |  |                    | 7,444  |                  |              |   | 1,775    |       |  |   | 5,669       |                  |  |              | 5,736    |  |       |   | 1,453  |  |  |   | 4,283  | 
|Leasehold improvements            |  |                    | 26,109 |                  |              |   | 14,191   |       |  |   | 11,918      |                  |  |              | 24,136   |  |       |   | 10,854 |  |  |   | 13,282 | 
|Software and electronic equipment |  |                    | 11,739 |                  |              |   | 8,211    |       |  |   | 3,528       |                  |  |              | 10,158   |  |       |   | 6,543  |  |  |   | 3,615  | 
|Molds                             |  |                    | 3,401  |                  |              |   | 2,186    |       |  |   | 1,215       |                  |  |              | 2,818    |  |       |   | 1,707  |  |  |   | 1,111  | 
|Furniture and fixtures            |  |                    | 3,564  |                  |              |   | 2,042    |       |  |   | 1,522       |                  |  |              | 3,052    |  |       |   | 1,456  |  |  |   | 1,596  | 
|Manufacturing equipment           |  |                    | 1,055  |                  |              |   | 455      |       |  |   | 600         |                  |  |              | 538      |  |       |   | 336    |  |  |   | 202    | 
|Automobiles and trucks            |  |                    | 11     |                  |              |   | 9        |       |  |   | 2           |                  |  |              | 37       |  |       |   | 12     |  |  |   | 25     | 
|                                  |  |                    |        |                  |              |   |          |       |  |   |             |                  |  |              |          |  |       |  
|                                  |  | $                  | 58,986 |                  |              | $ | 28,869   |       |  | $ | 30,117      |                  |  | $            | 51,469   |  |       | $ | 22,361 |  |  | $ | 29,108 | 
|                                  |  |                    |        |                  |              |   |          |       |  |   |             |                  |  |              |          |  |       |  



F-17



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|   |                   
|-- | ------------------
|7. | Bank indebtedness:



|           |  |                    |        |  |      |   |        | 
|---------- |  | ------------------ | ------ |  | ---- | - | ------ | 
|           |  | 2005               |        |  | 2004 |  
|           |  |                    |        |  |      |  
|           |  | (Amounts in 000s) |       
|Birks(a)   |  | $                  | 40,753 |  |      | $ | 37,257 | 
|Mayors(b) |  |                    | 33,501 |  |      |   | 33,005 | 
|           |  |                    |        |  |      |  
|           |  | $                  | 74,254 |  |      | $ | 70,262 | 
|           |  |                    |        |  |      |  






|    |                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | Birks had a loan agreement with GMAC which expired on
    July 31, 2004. Effective July 1, 2004, Birks entered
    into an amendment and restatement of its loan with GMAC for a
    further three-year period. The principal elements of the
    facility remained unchanged:



| |       |                                                                                                                                                                                                                                                                                                                                                                             
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)   | Birks may draw down on the facility to a maximum of $49,370,500
    (CAN$60,000,000). A clause in Birks facility allows it to
    draw up to $53,485,000 (CAN$65,000,000) during a certain period
    of the year. The short-term borrowings bear interest at an
    annual rate of prime plus 0.5%. Effective July 1, 2004, an
    unused line fee of 0.25% is applicable.
|
| | (ii)  | As security for borrowings under the credit facility, Birks has
    pledged assets as disclosed in note 9. In addition, the
    bank agreement contains customary financial covenants and other
    conditions.                                                                                                                                                             
|
| | (iii) | Should Birks terminate the agreement prior to July 31,
    2007, Birks has committed to pay the lender fees of $617,000
    (CAN$750,000), except if:                                                                                                                                                                                                                       



| |   |                                                                                                                                                                                                                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | Approximately $16,457,000 (CAN$20,000,000) of new funds (net of
    all investment banker, underwriter, brokerage or other fees and
    costs associated therewith) have been received by Birks either
    as new loans subordinated in favor of the lender or to any
    lender or as newly issued capital stock of Birks; and
|
| |  | The lender has been furnished with complete details of any bona
    fide, legitimate unrelated offer to replace Birks financing and
    the lender does not agree to match the terms and conditions of
    such offer within fourteen days of receipt of such details.                                                         



|                                               |  |                    |        |   |            |   |        |     |  |   |        |   |  |   |        |  
|---------------------------------------------- |  | ------------------ | ------ | - | ---------- | - | ------ | --- |  | - | ------ | - |  | - | ------ | -
|                                               |  | Year Ended         |        |   | Year Ended |  
|                                               |  | March 26,          |        |   | March 27,  |  
|                                               |  | 2005               |        |   | 2004       |  
|                                               |  |                    |        |   |            |  
|                                               |  | CAN                |        |   | US         |   |        | CAN |  |   | US     |  
|                                               |  |                    |        |   |            |   |        |     |  |   |        |  
|                                               |  | (Amounts in 000s) |       
|Maximum borrowings outstanding during the year |  | $                  | 62,601 |   |            | $ | 52,495 |     |  | $ | 64,049 |   |  | $ | 49,106 |  
|Average outstanding balance during the year    |  | $                  | 51,026 |   |            | $ | 39,920 |     |  | $ | 55,140 |   |  | $ | 40,763 |  
|Weighted average interest rate for the year    |  |                    | 4.51   | % |            |   | 4.51   | %   |  |   | 5.28   | % |  |   | 5.28   | %
|Effective interest rate at year-end            |  |                    | 4.75   | % |            |   | 4.75   | %   |  |   | 4.5    | % |  |   | 4.5    | %



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(b) | As of March 26, 2005, Mayors had a $58 million
    working capital credit facility with Fleet Retail Group LLC
    (formerly known as Fleet Retail Finance) and GMAC and a
    $12.7 million junior secured term loan with Back Bay
    Capital. The junior secured term loan is included in long-term
    debt (see note 9). Both of the debt facilities have a
    maturity date of August 20, 2006 and are collateralized by
    substantially all of Mayors assets. All borrowings under
    the working capital facility are considered bank indebtedness,
    due to the fact that the borrowing availability is based on
    certain inventory and accounts receivable balances which are
    short-term in nature. On September 7, 2004, Mayors
    entered into a Fourth Amendment to the working capital facility
    and the junior secured term loan (the Amended Credit
    Agreement). The Amended Credit Agreement provides for,
    among other things, an extended maturity

F-18



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | date to August 20, 2006, a 1.25% reduction of interest on
    the junior secured term loan, an interest reduction on the Fleet
    Retail Group LLC-GMAC portion of the credit facility, the
    elimination of two financial covenants and the increase to
    $4.5 million in the capital expenditures allowed pursuant
    to the sole remaining financial covenant which is measured
    annually. Availability under the working capital facility is
    determined based upon a percentage formula applied to certain
    inventory and accounts receivable as allowed by an amendment on
    February 20, 2004, and has certain restrictions regarding
    borrowing availability. The interest rate under the working
    capital facility as of March 26, 2005 was 6.25% (prime plus
    0.5%). On March 4, 2005, the capital expenditure limit was
    further increased to $5,000,000 per fiscal year.
    Mayors was in compliance with the capital expenditure
    covenant for 2005. The junior secured term loan currently bears
    an effective interest rate of 12.75% and is subject to similar
    restrictions and covenants as the working capital facility,
    including the capital expenditure covenant, as well as certain
    prepayment penalties.



| |                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | After taking into consideration the foregoing borrowing
    restrictions, Mayors had approximately $47.4 million
    of borrowing capacity under its working capital facility and
    term loan at March 26, 2005 and, after netting the
    outstanding borrowings of $33.5 million and letter of
    credit commitments of $550,000, Mayors had excess
    borrowing capacity of approximately $13.3 million.
|
| | On April 29, 2005, the Company paid down $1 million
    of the principal balance of the junior secured term loan without
    any prepayment penalty.                                                                                                                                                                                                                                                             
|
| | On May 3, 2005, the banking facilities were further
    amended to allow for the interest rate of Mayors revolving
    credit facility to be based on either a prime rate plus a
    specified margin dependent on the level of excess borrowing
    availability, or a LIBOR based rate (Eurodollar)
    plus a specified margin, based on the level of borrowing
    availability, at Mayors election.     
|
| | Information concerning Mayors credit facility follows:                                                                                                                                                                                                                                                                                                                                                          

|                                               |  |                    |        |   |            |   |        |  
|---------------------------------------------- |  | ------------------ | ------ | - | ---------- | - | ------ | -
|                                               |  | Year Ended         |        |   | Year Ended |  
|                                               |  | March 26,          |        |   | March 27,  |  
|                                               |  | 2005               |        |   | 2004       |  
|                                               |  |                    |        |   |            |  
|                                               |  | (Amounts in 000s) |       
|Maximum borrowings outstanding during the year |  | $                  | 48,417 |   |            | $ | 39,955 |  
|Average outstanding balance during the year    |  | $                  | 35,178 |   |            | $ | 31,004 |  
|Weighted average interest rate for the year    |  |                    | 5.6    | % |            |   | 6.3    | %
|Effective interest rate at year-end            |  |                    | 6.25   | % |            |   | 5.25   | %

F-19



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|   |                                                 
|-- | ------------------------------------------------
|8. | Loans for leasehold improvements and term loans:

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                    |       |  |      |   |       | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------ | ----- |  | ---- | - | ----- | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | 2005               |       |  | 2004 |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                    |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | (Amounts in 000s) |      
|Loan for leasehold improvements, to a maximum of $2,469
    (CAN$3,000), repayable on demand but, prior to demand, by way of
    60 equal and consecutive minimum monthly capital repayments of
    $41.1 (CAN$50), maturing in September 2006, bearing interest at
    an annual rate of prime plus 2.5%, covered under the security
    disclosed in note 9 and the leasehold improvements                                                                                                                                                                                                                           |  | $                  | 408   |  |      | $ | 831   | 
|Loan for leasehold improvements, to a maximum of $2,469
    (CAN$3,000), repayable on demand but, prior to demand, by way of
    60 equal and consecutive minimum monthly capital repayments of
    $41.1 (CAN$50), maturing in September 2006, bearing interest at
    an annual rate of prime plus 0.625%, covered under the security
    disclosed in note 9 and the leasehold improvements.
    Garantie Québec has guaranteed the lender repayment of 65%
    of any loss which may be sustained by the lender in connection
    with the loan in exchange for an annual fee of 2% of the
    outstanding balance |  |                    | 741   |  |      |   | 1,138 | 
|Term loan repayable on demand but, prior to demand, by way of 60
    equal and consecutive minimum monthly capital repayments of $5.5
    (CAN$6.7), bearing interest at an annual rate of prime plus
    2.5%, maturing in October 2005                                                                                                                                                                                                                                                                                                                                                                               |  |                    | 38    |  |      |   | 96    | 
|Non-revolving demand loan, repayable in monthly capital
    repayments of $1.48 (CAN$1.8), bearing interest at an
    annual rate of prime plus 1%, maturing in May 2009. Certain
    equipment and leasehold improvements of a store have been
    pledged as security                                                                                                                                                                                                                                                                                                                                                |  |                    | 75    |  |      |   | 84    | 
|Loan for leasehold improvements repayable on demand but, prior
    to demand, by way of 60 equal and consecutive minimum monthly
    capital repayments of $68.5 (CAN$83.3), maturing in December
    2004, bearing interest at an annual rate of prime plus 0.375%,
    covered under the security disclosed in note 9 and the
    leasehold improvements. Garantie Québec has guaranteed the
    lender repayment of 30% of any loss which may be sustained by
    the lender in connection with this loan in exchange for an
    annual fee of 1% of the outstanding balance                                        |  |                    |      |  |      |   | 576   | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                    |       |  |      |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  | $                  | 1,262 |  |      | $ | 2,725 | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |                    |       |  |      |  

F-20



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|   |                
|-- | ---------------
|9. | Long-term debt:



|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    |        |  |      |   |        | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------------ | ------ |  | ---- | - | ------ | 
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  | 2005               |        |  | 2004 |  
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    |        |  |      |  
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  | (Amounts in 000s) |       
|Birks(b):                                                                                                                                                                                                                                                                                                                                                                                                          |  |                    |        |  |      |   |        | 
|Sovereign Bank term loan, bearing interest at an annual rate of
    6.75%, repayable to February 2010 in 57 monthly capital and
    interest installments of $2.0, secured by Henry Birks &
    Sons US Inc. equipment with a cost of $293                                                                                                                                                                         |  | $                  | 100    |  |      | $ |       | 
|Term loan from La Financière du Québec, bearing
    interest at an annual rate of prime plus 1.5%, repayable to June
    2010 in 84 equal monthly capital repayments of $44.1 (CAN$53.6),
    secured by the assets of the Company, ranking second to the
    Companys bank indebtedness, and by a $370 (CAN$450) Letter
    of Credit issued by Regaluxe Investment S.à.r.l. on behalf
    of Birks (note 20(d)) |  |                    | 2,598  |  |      |   | 3,048  | 
|Subordinated loan from the Companys parent, Regaluxe
    Investment S.à.r.l., bearing annual interest, after
    withholding taxes, of 12% to August 2005 and 14% thereafter,
    repayable in March 2006 following its renewal by the Company for
    an additional twelve months with repayment privilege subject to
    the approval of the Companys principal lender                                         |  |                    | 2,057  |  |      |   | 1,896  | 
|Obligation under capital lease on land and building, bearing
    annual interest of 5%, repayable in monthly capital installments
    of $5.4, maturing in March 2025, secured by the property, second
    position on other assets of Henry Birks & Sons US Inc.
    and a guarantee by the Company subordinated to all pre-existing
    debt                                                                     |  |                    | 1,300  |  |      |   |       | 
|Obligations under capital leases, at annual interest rates
    between 5.8% and 9.7%, secured by equipment, maturing at various
    dates from June 2005 to March 2010                                                                                                                                                                                                                                             |  |                    | 478    |  |      |   | 389    | 
|Obligation under capital lease on land and buildings, pursuant
    to a sale-leaseback transaction (note 11). The term loan is
    being amortized using an implicit annual interest rate of 10.74%
    over the term of the lease of 20 years with a balloon
    payment                                                                                                                                          |  |                    | 12,261 |  |      |   | 11,239 | 
|Loan payable to Regaluxe Investment S.à.r.l., bearing
    interest at 3.55% per annum, net of withholding taxes,
    maturing March 1, 2006                                                                                                                                                                                                                                                                        |  |                    | 169    |  |      |   | 312    | 
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    |        |  |      |  
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    | 18,963 |  |      |   | 16,884 | 
|Mayors:                                                                                                                                                                                                                                                                                                                                                                                                           |  |                    |        |  |      |   |        | 
|Junior secured term loan (note 7(b))                                                                                                                                                                                                                                                                                                                                                                               |  |                    | 12,668 |  |      |   | 12,668 | 
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    |        |  |      |  
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    | 31,631 |  |      |   | 29,552 | 
|Current portion                                                                                                                                                                                                                                                                                                                                                                                                    |  |                    | 3,076  |  |      |   | 989    | 
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    |        |  |      |  
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  | $                  | 28,555 |  |      | $ | 28,563 | 
|                                                                                                                                                                                                                                                                                                                                                                                                                   |  |                    |        |  |      |  





| |                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) general assignment of all accounts receivable and other
    receivables;                                                                                        
|
| | (ii) inventory security under Section 427 of the
    Canadian Bank Act and under an act respecting bills of lading,
    receipts and transfers of property in stock;

F-21



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




| |                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (iii) general security agreements;                                                                                                                                                                                                   
|
| | (iv) insurance on physical assets in a minimum amount
    equivalent to the indebtedness, assigned to the lenders;                                                                                                                   
|
| | (v) a mortgage on moveable property (general) under
    the Civil Code (Québec) of $65,824,000 (CAN$80,000,000), an
    additional mortgage of $13,165,000 (CAN$16,000,000) and a third
    mortgage of $13,165,000 (CAN$16,000,000);
|
| | (vi) lien on machinery, equipment and molds and
    dies; and                                                                                                                                                                        
|
| | (vii) the securitization and subordination of all present
    and future indebtedness owing by the Company to Regaluxe
    Investment S.à.r.l.                                                                                       



|                      |            |                    |     |     |       |   |        |        |  |  |        |        |   |   |        |        | 
|--------------------- | ---------- | ------------------ | --- | --- | ----- | - | ------ | ------ |  |  | ------ | ------ | - | - | ------ | ------ | 
|                      |            | Mayors            |     |     | Birks |   |        | Total  | 
|                      |            |                    |     |     |       |   |        |        | 
|                      |            | (Amounts in 000s) |    
|Year ending March:    |            |                    |     |     |       |   |        |        |  |  |        |        |   |   |        |       
|                      | 2006       |                    | $   | 119 |       |   | $      | 1,595  |  |  | (CAN $ | 1,938  | ) |   | $      | 1,714  | 
|                      | 2007       |                    |     | 83  |       |   |        | 1,491  |  |  | (CAN $ | 1,812  | ) |   |        | 1,574  | 
|                      | 2008       |                    |     | 81  |       |   |        | 1,491  |  |  | (CAN $ | 1,812  | ) |   |        | 1,572  | 
|                      | 2009       |                    |     | 56  |       |   |        | 1,488  |  |  | (CAN $ | 1,808  | ) |   |        | 1,544  | 
|                      | 2010       |                    |     | 9   |       |   |        | 1,519  |  |  | (CAN $ | 1,845  | ) |   |        | 1,528  | 
|                      | Thereafter |                    |     |    |       |   |        | 24,785 |  |  | (CAN $ | 30,121 | ) |   |        | 24,785 | 
|                      |            |                    |     |     |       |   |        |        |  |  |        |       
|                      |            |                    | 348 |     |       |   | 32,369 |        |  |  |        |        |   |   | 32,717 |       
|Less imputed interest |            |                    | 36  |     |       |   | 18,642 |        |  |  |        |        |   |   | 18,678 |       
|                      |            |                    |     |     |       |   |        |        |  |  |        |       
|                      |            | $                  | 312 |     |       | $ | 13,727 |        |  |  |        |        |   | $ | 14,039 |       
|                      |            |                    |     |     |       |   |        |        |  |  |        |       



|                   |            |                    |        |        |       |   |        |        |  |  |        |        |   |   |        |        | 
|------------------ | ---------- | ------------------ | ------ | ------ | ----- | - | ------ | ------ |  |  | ------ | ------ | - | - | ------ | ------ | 
|                   |            | Mayors            |        |        | Birks |   |        | Total  | 
|                   |            |                    |        |        |       |   |        |        | 
|                   |            | (Amounts in 000s) |       
|Year ending March: |            |                    |        |        |       |   |        |        |  |  |        |        |   |   |        |       
|                   | 2006       |                    | $      | 102    |       |   | $      | 2,974  |  |  | (CAN $ | 3,615  | ) |   | $      | 3,076  | 
|                   | 2007       |                    |        | 12,741 |       |   |        | 650    |  |  | (CAN $ | 790    | ) |   |        | 13,391 | 
|                   | 2008       |                    |        | 74     |       |   |        | 655    |  |  | (CAN $ | 796    | ) |   |        | 729    | 
|                   | 2009       |                    |        | 54     |       |   |        | 661    |  |  | (CAN $ | 803    | ) |   |        | 715    | 
|                   | 2010       |                    |        | 9      |       |   |        | 653    |  |  | (CAN $ | 794    | ) |   |        | 662    | 
|                   | Thereafter |                    |        |       |       |   |        | 13,058 |  |  | (CAN $ | 15,870 | ) |   |        | 13,058 | 
|                   |            |                    |        |        |       |   |        |        |  |  |        |       
|                   |            | $                  | 12,980 |        |       | $ | 18,651 |        |  |  |        |        |   | $ | 31,631 |       
|                   |            |                    |        |        |       |   |        |        |  |  |        |       



|    |                   
|--- | ------------------
|10. | Convertible notes:









F-22



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)










|    |                            
|--- | ---------------------------
|11. | Sale-leaseback transaction:











|    |                         
|--- | ------------------------
|12. | Discontinued operations:





|    |                             
|--- | ----------------------------
|13. | Allowance for restructuring:



|                        |  |                    |        |  
|----------------------- |  | ------------------ | ------ | -
|                        |  | (Amounts in 000s) |       
|Balance August 20, 2002 |  | $                  | 3,149  |  
|Deductions              |  |                    | (3,149 | )
|                        |  |                    |       
|Balance March 29, 2003  |  | $                  |       |  
|                        |  |                    |       



F-23



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)








|    |                                            
|--- | -------------------------------------------
|14. | Benefit plans and stock-based compensation:



|    |                                     
|--- | ------------------------------------
|(a) | Stock option plans and arrangements:









|                            |  |               |         |                  |                |   |      | 
|--------------------------- |  | ------------- | ------- | ---------------- | -------------- | - | ---- | 
|                            |  |               |         | Weighted Average |               
|                            |  | Options       |         |                  | Exercise Price |  
|                            |  |               |         |                  |                |  
|                            |  | (CAN dollars) |        
|Outstanding, March 30, 2002 |  |               | 704,562 |                  |                | $ | 6.54 | 
|Granted                     |  |               | 91,836  |                  |                |   | 6.58 | 
|Forfeited/cancelled         |  |               | (14,095 | )                |                |   | 6.99 | 
|                            |  |               |         |                  |                |  
|Outstanding March 29, 2003  |  |               | 782,303 |                  |                |   | 6.42 | 
|Forfeited/cancelled         |  |               | (2,475  | )                |                |   | 7.23 | 
|                            |  |               |         |                  |                |  
|Outstanding March 27, 2004  |  |               | 779,828 |                  |                |   | 6.42 | 
|Granted                     |  |               | 45,000  |                  |                |   | 7.73 | 
|Forfeited/cancelled         |  |               | (41,538 | )                |                |   | 7.24 | 
|                            |  |               |         |                  |                |  
|Outstanding March 26, 2005  |  |               | 783,290 |                  |                | $ | 6.45 | 
|                            |  |               |         |                  |                |  

F-24



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|               |  |                     |         |          |                     |  |          |          |  |   |             |          |  |          |         |  |  |   |      | 
|-------------- |  | ------------------- | ------- | -------- | ------------------- |  | -------- | -------- |  | - | ----------- | -------- |  | -------- | ------- |  |  | - | ---- | 
|               |  | Options Outstanding |         |          | Options Exercisable | 
|               |  |                     |         |          |                     | 
|               |  |                     |         | Weighted |                     |  | Weighted |          |  |   |             | Weighted | 
|               |  |                     |         | Average  |                     |  | Average  |          |  |   |             | Average  | 
|               |  | Number              |         |          | Remaining           |  |          | Exercise |  |   | Number      |          |  | Exercise |        
|Exercise Price |  | Outstanding         |         |          | Life (Years)        |  |          | Price    |  |   | Exercisable |          |  | Price    |        
|               |  |                     |         |          |                     |  |          |          |  |   |             |          |  |          |        
|(CAN dollars)  |  | (CAN dollars)       |        
|$6.00          |  |                     | 259,560 |          |                     |  | 3.1      |          |  | $ | 6.00        |          |  |          | 259,560 |  |  | $ | 6.00 | 
|$6.25          |  |                     | 292,786 |          |                     |  | 3.9      |          |  |   | 6.25        |          |  |          | 292,786 |  |  |   | 6.25 | 
|$7.00          |  |                     | 162,194 |          |                     |  | 6.3      |          |  |   | 7.00        |          |  |          | 162,194 |  |  |   | 7.00 | 
|$7.73          |  |                     | 68,750  |          |                     |  | 8.0      |          |  |   | 7.73        |          |  |          | 36,587  |  |  |   | 7.73 | 
|               |  |                     |         |          |                     |  |          |          |  |   |             |          |  |          |        
|               |  |                     | 783,290 |          |                     |  | 4.5      |          |  | $ | 6.45        |          |  |          | 751,127 |  |  | $ | 6.40 | 
|               |  |                     |         |          |                     |  |          |          |  |   |             |          |  |          |        











F-25



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|    |                              
|--- | -----------------------------
|(e) | Employee stock purchase plan:







|    |                     
|--- | --------------------
|(f) | Profit sharing plan:









|                            |  |         |            |          |       |   |      | 
|--------------------------- |  | ------- | ---------- | -------- | ----- | - | ---- | 
|                            |  |         |            | Weighted |      
|                            |  |         |            | Average  |      
|                            |  |         |            | Exercise |      
|                            |  | Options |            |          | Price |  
|                            |  |         |            |          |       |  
|Outstanding August 20, 2002 |  |         | 4,074,882  |          |       | $ | 4.04 | 
|Granted                     |  |         | 2,650,000  |          |       |   | 0.28 | 
|Forfeited/cancelled         |  |         | (366,412   | )        |       |   | 6.56 | 
|                            |  |         |            |          |       |  
|Outstanding March 29, 2003  |  |         | 6,358,470  |          |       |   | 2.33 | 
|Granted                     |  |         | 170,000    |          |       |   | 0.70 | 
|Forfeited/cancelled         |  |         | (496,673   | )        |       |   | 5.53 | 
|                            |  |         |            |          |       |  
|Outstanding March 27, 2004  |  |         | 6,031,797  |          |       |   | 2.02 | 
|Granted                     |  |         | 80,000     |          |       |   | 0.62 | 
|Forfeited/cancelled         |  |         | (1,425,834 | )        |       |   | 4.21 | 
|                            |  |         |            |          |       |  
|Outstanding March 26, 2005  |  |         | 4,685,963  |          |       | $ | 1.33 | 
|                            |  |         |            |          |       |  

F-26



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|                         |  |                     |           |          |                     |  |          |          |  |   |             |          |  |          |           |  |  |   |       | 
|------------------------ |  | ------------------- | --------- | -------- | ------------------- |  | -------- | -------- |  | - | ----------- | -------- |  | -------- | --------- |  |  | - | ----- | 
|                         |  | Options Outstanding |           |          | Options Exercisable | 
|                         |  |                     |           |          |                     | 
|                         |  |                     |           | Weighted |                     |  | Weighted |          |  |   |             | Weighted | 
|                         |  |                     |           | Average  |                     |  | Average  |          |  |   |             | Average  | 
|                         |  | Number              |           |          | Remaining           |  |          | Exercise |  |   | Number      |          |  | Exercise |          
|Range of Exercise Prices |  | Outstanding         |           |          | Life (Years)        |  |          | Price    |  |   | Exercisable |          |  | Price    |          
|                         |  |                     |           |          |                     |  |          |          |  |   |             |          |  |          |          
|$0.23 - $ 0.34           |  |                     | 2,645,000 |          |                     |  | 7.5      | *        |  | $ | 0.28        |          |  |          | 2,330,001 |  |  | $ | 0.28  | 
|$0.35 - $ 0.52           |  |                     | 45,000    |          |                     |  | 8.3      |          |  |   | 0.42        |          |  |          | 43,333    |  |  |   | 0.42  | 
|$0.53 - $ 0.79           |  |                     | 210,000   |          |                     |  | 9.1      |          |  |   | 0.72        |          |  |          | 96,667    |  |  |   | 0.78  | 
|$0.80 - $ 1.20           |  |                     | 263,333   |          |                     |  | 6.8      |          |  |   | 0.94        |          |  |          | 263,333   |  |  |   | 0.94  | 
|$1.21 - $ 1.81           |  |                     | 162,500   |          |                     |  | 5.8      |          |  |   | 1.53        |          |  |          | 162,500   |  |  |   | 1.53  | 
|$1.82 - $ 2.73           |  |                     | 705,629   |          |                     |  | 3.4      |          |  |   | 2.41        |          |  |          | 705,629   |  |  |   | 2.41  | 
|$2.74 - $ 4.11           |  |                     | 474,833   |          |                     |  | 5.4      |          |  |   | 3.65        |          |  |          | 474,833   |  |  |   | 3.65  | 
|$4.12 - $ 6.18           |  |                     | 98,002    |          |                     |  | 3.5      |          |  |   | 4.68        |          |  |          | 98,002    |  |  |   | 4.68  | 
|$6.19 - $ 9.28           |  |                     | 20,000    |          |                     |  | 0.3      |          |  |   | 6.44        |          |  |          | 20,000    |  |  |   | 6.44  | 
|$9.29 - $13.94           |  |                     | 61,666    |          |                     |  | 7.2      |          |  |   | 12.99       |          |  |          | 61,666    |  |  |   | 12.99 | 
|                         |  |                     |           |          |                     |  |          |          |  |   |             |          |  |          |          
|$0.23 - $13.94           |  |                     | 4,685,963 |          |                     |  | 6.5      |          |  | $ | 1.33        |          |  |          | 4,255,964 |  |  | $ | 1.42  | 
|                         |  |                     |           |          |                     |  |          |          |  |   |             |          |  |          |          






|  |                                                                                                                                                                                                                                        
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | 1,500,000 of these options were granted to the Chief Executive
    Officer and expire either after ten years or two years after
    termination of employment. For purposes of the information
    herein, a term of ten years is used.



|    |              
|--- | -------------
|15. | Income taxes:



|                                                  |                                                                 |                    |       |       |         |  |        |        |  |   |         |        |  |         |       |       |       |  |        |        |  |   |         |        | 
|------------------------------------------------- | --------------------------------------------------------------- | ------------------ | ----- | ----- | ------- |  | ------ | ------ |  | - | ------- | ------ |  | ------- | ----- | ----- | ----- |  | ------ | ------ |  | - | ------- | ------ | 
|                                                  |                                                                 | 2005               |       |       | 2004    | 
|                                                  |                                                                 |                    |       |       |         | 
|                                                  |                                                                 | Birks              |       |       | Mayors |  |        | Total  |  |   | Birks   |        |  | Mayors |       |       | Total | 
|                                                  |                                                                 |                    |       |       |         |  |        |        |  |   |         |        |  |         |       |       |       | 
|                                                  |                                                                 | (Amounts in 000s) |      
|Deferred tax assets:                              |                                                                 |                    |       |       |         |  |        |        |  |   |         |        |  |         |       |       |       |  |        |        |  |   |         |       
|                                                  | Loss and tax credit carry forwards                              |                    | $     | 2,889 |         |  | $      | 28,331 |  |   | $       | 31,220 |  |         | $     | 305   |       |  | $      | 27,025 |  |   | $       | 27,330 | 
|                                                  | Difference between book and tax basis of property and equipment |                    |       | 3,022 |         |  |        | 8,449  |  |   |         | 11,471 |  |         |       | 5,019 |       |  |        | 8,403  |  |   |         | 13,422 | 
|                                                  | Local tax carry forwards                                        |                    |       |      |         |  |        | 3,697  |  |   |         | 3,697  |  |         |       |      |       |  |        | 3,351  |  |   |         | 3,351  | 
|                                                  | Inventory allowances                                            |                    |       |      |         |  |        | 1,401  |  |   |         | 1,401  |  |         |       |      |       |  |        | 2,578  |  |   |         | 2,578  | 
|                                                  | Other reserves not currently deductible                         |                    |       | 89    |         |  |        | 1,784  |  |   |         | 1,873  |  |         |       | 189   |       |  |        | 2,502  |  |   |         | 2,691  | 
|                                                  | Deferred gain on sale-leaseback                                 |                    |       | 1,606 |         |  |        |       |  |   |         | 1,606  |  |         |       | 1,423 |       |  |        |       |  |   |         | 1,423  | 
|                                                  | Expenses not currently deductible                               |                    |       | 1,239 |         |  |        |       |  |   |         | 1,239  |  |         |       | 1,084 |       |  |        |       |  |   |         | 1,084  | 
|                                                  | Other                                                           |                    |       | 143   |         |  |        | 798    |  |   |         | 941    |  |         |       | 180   |       |  |        | 848    |  |   |         | 1,028  | 
|                                                  |                                                                 |                    |       |       |         |  |        |        |  |   |         |        |  |         |       |       |       | 
|Net deferred tax asset before valuation allowance |                                                                 |                    | 8,988 |       |         |  | 44,460 |        |  |   | 53,448  |        |  |         | 8,200 |       |       |  | 44,707 |        |  |   | 52,907  |       
|Valuation allowance                               |                                                                 |                    |       |       |         |  |        |        |  |   | (53,448 | )      |  |         |       |       |       |  |        |        |  |   | (52,907 | )     
|                                                  |                                                                 |                    |       |       |         |  |        |        |  |   |         |        |  |         |       |       |       | 
|Net deferred tax asset                            |                                                                 |                    |       |       |         |  |        |        |  | $ |        |        |  |         |       |       |       |  |        |        |  | $ |        |       
|                                                  |                                                                 |                    |       |       |         |  |        |        |  |   |         |        |  |         |       |       |       | 



F-27



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)






|                                  |  |      |       |    |      |  |       |      |  |  |       |   
|--------------------------------- |  | ---- | ----- | -- | ---- |  | ----- | ---- |  |  | ----- | --
|                                  |  | 2005 |       |    | 2004 |  |       | 2003 | 
|                                  |  |      |       |    |      |  |       |      | 
|Statutory rate                    |  |      | 33.8  | %  |      |  | 35.2  | %    |  |  | 37.1  | % 
|Increase in valuation allowance   |  |      | (36.0 | )% |      |  | (69.6 | )%   |  |  | (18.0 | )%
|Local and Federal NOL adjustments |  |      | (8.0  | )% |      |  | 44.0  | %    |  |  |      |   
|Warrants                          |  |      | 21.7  | %  |      |  | 2.0   | %    |  |  |      |   
|Changes in tax rates              |  |      | (11.3 | )% |      |  | (7.0  | )%   |  |  | 3.5   | % 
|Other                             |  |      | (0.2  | )% |      |  | (4.6  | )%   |  |  | (3.4  | )%
|                                  |  |      |       |    |      |  |       |      | 
|Total                             |  |      | 0     | %  |      |  | 0     | %    |  |  | 19.2  | % 
|                                  |  |      |       |    |      |  |       |      | 



|                               |         |                    |   |      |  |      |   |   |  |   |      |      |  
|------------------------------ | ------- | ------------------ | - | ---- |  | ---- | - | - |  | - | ---- | ---- | -
|                               |         | 2005               |   | 2004 |  | 2003 |  
|                               |         |                    |   |      |  |      |  
|                               |         | (Amounts in 000s) |  
|Current tax:                   |         |                    |   |      |  |      |   |   |  |   |      |     
|                               | Federal |                    | $ |     |  |      | $ |  |  |   | $    | (989 | )
|                               | Foreign |                    |   |     |  |      |   |  |  |   |      | (2   | )
|                               |         |                    |   |      |  |      |   |   | 
|                               |         |                    |  |      |  |      |  |   |  |   | (991 | )   
|Deferred tax:                  |         |                    |   |      |  |      |   |   |  |   |      |     
|                               | Federal |                    |   |     |  |      |   |  |  |   |      |     |  
|                               |         |                    |   |      |  |      |   |   | 
|Total benefit for income taxes |         | $                  |  |      |  | $    |  |   |  | $ | (991 | )   
|                               |         |                    |   |      |  |      |   |   | 



|     |  |                    |       |  |       |   |    | 
|---- |  | ------------------ | ----- |  | ----- | - | -- | 
|     |  | Non-Capital        |       |  |      
|     |  | Losses             |       |  | ITCs |  
|     |  |                    |       |  |       |  
|     |  | (Amounts in 000s) |      
|2006 |  | $                  | 697   |  |       | $ |   | 
|2007 |  |                    | 250   |  |       |   |   | 
|2008 |  |                    | 252   |  |       |   |   | 
|2009 |  |                    | 237   |  |       |   |   | 
|2010 |  |                    | 30    |  |       |   |   | 
|2012 |  |                    |      |  |       |   |    | 
|2013 |  |                    |      |  |       |   | 50 | 
|2014 |  |                    | 46    |  |       |   | 20 | 
|2015 |  |                    | 6,058 |  |       |   | 25 | 
|     |  |                    |       |  |       |  
|     |  | $                  | 7,570 |  |       | $ | 95 | 
|     |  |                    |       |  |       |  









F-28



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)








|    |               
|--- | --------------
|16. | Capital Stock:







| |   |                                                                                                                                                                                                                           
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | created new Class A voting shares;                                                                                                                                                                                        
|
| |  | created new Class B multiple voting shares having
    substantially the same rights as the Class A voting shares
    but with 10 votes per share;                                                                         
|
| |  | created new Class C multiple voting shares with 100 votes
    per share;                                                                                                                                                  
|
| |  | converted all common shares into Class A voting shares on a
    1 for 1.01166 basis and, subsequently, cancelled the common
    shares;                                                                                   
|
| |  | Regaluxe Investment S.à.r.l. and Montrolux S.A. subscribed
    for Class C shares;                                                                                                                                        
|
| |  | Regaluxe Investment S.à.r.l. and Montrolux S.A. transferred
    their respective Class A shares of Henry Birks and Sons
    Holdings Inc. to Birks for consideration equal to Class B
    multiple voting shares of Birks;
|
| |  | amended the Series A preferred share conversion feature to
    provide for the conversion into Class A voting shares
    instead of common shares on a 1 for 1.01166 basis rounded to the
    nearest whole number;       
|
| |  | the Class A voting shares as well as the Series A
    preferred shares held by Henry Birks and Sons Holdings Inc. were
    cancelled;                                                                                     
|
| |  | amended the conversion feature of the convertible notes to
    provide for conversion into Class A voting and Class B
    multiple voting shares instead of common shares;                                                
|
| |  | Class C shares held by Regaluxe Investment S.à.r.l.
    and Montrolux S.A. were cancelled.                                                                                                                                





| |            
| | -----------
| | Authorized:



| |                                                                                            
| | -------------------------------------------------------------------------------------------
| | Class A voting shares, unlimited number of shares without
    nominal or par value         
|
| | Class B multiple voting shares, unlimited number of shares
    without nominal or par value
|
| | 100,000 Class C multiple voting shares                                                     
|
| | 2,034,578 preferred shares                                                                 
|
| | Unlimited number of non-voting common shares                                               

F-29



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)


|                                                                                                                                                                                                             |  |                    |            |         |              |   |         |              |  |       |              |        |          |                  |     |  |        |  |           |           |  |        |        |  |  |           |            |   |        |   |         |   |  |  |            |   |  |   |        |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ------------------ | ---------- | ------- | ------------ | - | ------- | ------------ |  | ----- | ------------ | ------ | -------- | ---------------- | --- |  | ------ |  | --------- | --------- |  | ------ | ------ |  |  | --------- | ---------- | - | ------ | - | ------- | - |  |  | ---------- | - |  | - | ------ | -
|                                                                                                                                                                                                             |  |                    |            | Class A |              |   | Class B |              |  | Total |              |        | Series A |                 
|                                                                                                                                                                                                             |  | Common Stock       |            |         | Common Stock |   |         | Common Stock |  |       | Common Stock |        |          | Preferred Shares |    
|                                                                                                                                                                                                             |  |                    |            |         |              |   |         |              |  |       |              |        |          |                  |    
|                                                                                                                                                                                                             |  | Number             |            |         |              |   | Number  |              |  |       |              | Number |          |                  |     |  | Number |  |           |           |  | Number |        |  | 
|                                                                                                                                                                                                             |  | of Shares          |            |         | Amount       |   |         | of Shares    |  |       | Amount       |        |          | of Shares        |     |  | Amount |  |           | of Shares |  |        | Amount |  |  | of Shares |            |   | Amount |  
|                                                                                                                                                                                                             |  |                    |            |         |              |   |         |              |  |       |              |        |          |                  |     |  |        |  |           |           |  |        |        |  |  |           |            |   |        |  
|                                                                                                                                                                                                             |  | (Amounts in 000s) |           
|Balance March 30, 2002, March 29, 2003 and
    March 27, 2004                                                                                                                                                |  |                    | 6,313,308  |         |              | $ | 31,405  |              |  |       |             |        |          | $                |    |  |        |  |          |           |  | $      |       |  |  |           | 6,313,308  |   |        | $ | 31,405  |   |  |  | 2,034,578  |   |  | $ | 10,050 |  
|Repurchase of shares                                                                                                                                                                                         |  |                    | (10,290    | )       |              |   | (41     | )            |  |       |             |        |          |                  |    |  |        |  |          |           |  |        |       |  |  |           | (10,290    | ) |        |   | (41     | ) |  |  |           |   |  |   |       |  
|Exchange of common shares for Class A and Class B
    shares                                                                                                                                                 |  |                    | (6,303,018 | )       |              |   | (31,364 | )            |  |       |             |        |          |                  |    |  |        |  |          |           |  |        |       |  |  |           | (6,303,018 | ) |        |   | (31,364 | ) |  |  |           |   |  |   |       |  
|Issuance of Class A shares in exchange for common shares                                                                                                                                                     |  |                    |           |         |              |   |        |              |  |       | 85,450       |        |          |                  | 336 |  |        |  |          |           |  |        |       |  |  |           | 85,450     |   |        |   | 336     |   |  |  |           |   |  |   |       |  
|Issuance of Class B shares in exchange for the Class A
    shares of Henry Birks and Sons Holdings Inc. and cancellation of
    the Series A preferred shares held by Henry Birks and Sons
    Holdings Inc. |  |                    |           |         |              |   |        |              |  |       |             |        |          |                  |    |  |        |  | 7,213,094 |           |  |        | 36,028 |  |  |           | 7,213,094  |   |        |   | 36,028  |   |  |  | (1,012,228 | ) |  |   | (5,000 | )
|                                                                                                                                                                                                             |  |                    |            |         |              |   |         |              |  |       |              |        |          |                  |     |  |        |  |           |           |  |        |        |  |  |           |            |   |        |  
|Balance March 26, 2005                                                                                                                                                                                       |  |                    |           |         |              | $ |        |              |  |       | 85,450       |        |          | $                | 336 |  |        |  | 7,213,094 |           |  | $      | 36,028 |  |  |           | 7,298,544  |   |        | $ | 36,364  |   |  |  | 1,022,350  |   |  | $ | 5,050  |  
|                                                                                                                                                                                                             |  |                    |            |         |              |   |         |              |  |       |              |        |          |                  |     |  |        |  |           |           |  |        |        |  |  |           |            |   |        |  





|    |             
|--- | ------------
|17. | Commitments:



| |                  
| | -----------------
| | Operating leases:





|                   |            |                          |        |        |       |   |        |       |  |  |       |       |   |   |        |        | 
|------------------ | ---------- | ------------------------ | ------ | ------ | ----- | - | ------ | ----- |  |  | ----- | ----- | - | - | ------ | ------ | 
|                   |            | Mayors                  |        |        | Birks |   |        | Total | 
|                   |            |                          |        |        |       |   |        |       | 
|                   |            | (Amounts shown in 000s) |       
|Year ending March: |            |                          |        |        |       |   |        |       |  |  |       |       |   |   |        |       
|                   | 2006       |                          | $      | 7,102  |       |   | $      | 5,978 |  |  | (CAN$ | 7,266 | ) |   | $      | 13,080 | 
|                   | 2007       |                          |        | 6,141  |       |   |        | 5,836 |  |  | (CAN$ | 7,092 | ) |   |        | 11,977 | 
|                   | 2008       |                          |        | 5,523  |       |   |        | 5,225 |  |  | (CAN$ | 6,349 | ) |   |        | 10,748 | 
|                   | 2009       |                          |        | 5,484  |       |   |        | 4,236 |  |  | (CAN$ | 5,148 | ) |   |        | 9,720  | 
|                   | 2010       |                          |        | 4,332  |       |   |        | 3,267 |  |  | (CAN$ | 3,970 | ) |   |        | 7,599  | 
|                   | Thereafter |                          |        | 13,135 |       |   |        | 7,134 |  |  | (CAN$ | 8,671 | ) |   |        | 20,269 | 
|                   |            |                          |        |        |       |   |        |       |  |  |       |      
|                   |            | $                        | 41,717 |        |       | $ | 31,676 |       |  |  |       |       |   | $ | 73,393 |       
|                   |            |                          |        |        |       |   |        |       |  |  |       |      



F-30



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|    |               
|--- | --------------
|18. | Contingencies:











|    |                       
|--- | ----------------------
|19. | Segmented information:



F-31



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)




|                                                                                  |  |                                         |        |  |         |   |        |               |  |   |        |  |  |      |         |  |      |   |         |      |  |   |        |   |  |      |        |   |      |   |      |      |  |   |       |   |  |   |         |  |  |   |         |   |  |   |         | 
|--------------------------------------------------------------------------------- |  | --------------------------------------- | ------ |  | ------- | - | ------ | ------------- |  | - | ------ |  |  | ---- | ------- |  | ---- | - | ------- | ---- |  | - | ------ | - |  | ---- | ------ | - | ---- | - | ---- | ---- |  | - | ----- | - |  | - | ------- |  |  | - | ------- | - |  | - | ------- | 
|                                                                                  |  | Birks                                   |        |  | Mayors |   |        | Consolidation |  |   | Totals | 
|                                                                                  |  |                                         |        |  |         |   |        |               |  |   |        | 
|                                                                                  |  | 2005                                    |        |  | 2004    |   |        | 2003          |  |   | 2005   |  |  | 2004 |         |  | 2003 |   |         | 2005 |  |   | 2004   |   |  | 2003 |        |   | 2005 |   |      | 2004 |  |   | 2003  |  
|                                                                                  |  |                                         |        |  |         |   |        |               |  |   |        |  |  |      |         |  |      |   |         |      |  |   |        |   |  |      |        |   |      |   |      |      |  |   |       |  
|                                                                                  |  | (Amounts shown in thousands of dollars) |       
|Sales to external customers                                                       |  | $                                       | 96,600 |  |         | $ | 90,825 |               |  | $ | 78,444 |  |  | $    | 142,701 |  |      | $ | 125,431 |      |  | $ | 72,868 |   |  | $    |       |   |      | $ |     |      |  | $ |      |   |  | $ | 239,301 |  |  | $ | 216,256 |   |  | $ | 151,312 | 
|Inter-segment sales                                                               |  |                                         | 8,852  |  |         |   | 638    |               |  |   | 413    |  |  |      | 9       |  |      |   | 56      |      |  |   | 192    |   |  |      | (8,861 | ) |      |   | (694 | )    |  |   | (605  | ) |  |   |        |  |  |   |        |   |  |   |        | 
|Depreciation and amortization of property and equipment and
    intangible assets |  |                                         | 3,565  |  |         |   | 3,332  |               |  |   | 2,896  |  |  |      | 1,624   |  |      |   | 1,287   |      |  |   | 580    |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   | 5,189   |  |  |   | 4,619   |   |  |   | 3,476   | 
|Operating income (loss) from continuing operations                                |  |                                         | 3,305  |  |         |   | 968    |               |  |   | 3,543  |  |  |      | 6,853   |  |      |   | (1,512  | )    |  |   | (2,802 | ) |  |      | (226   | ) |      |   | (349 | )    |  |   | (63   | ) |  |   | 9,932   |  |  |   | (893    | ) |  |   | 678     | 
|Financial costs                                                                   |  |                                         | 4,164  |  |         |   | 3,743  |               |  |   | 3,379  |  |  |      | 4,501   |  |      |   | 4,427   |      |  |   | 2,555  |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   | 8,665   |  |  |   | 8,170   |   |  |   | 5,934   | 
|Extraordinary gain                                                                |  |                                         |       |  |         |   |       |               |  |   |       |  |  |      |        |  |      |   |        |      |  |   |       |   |  |      |       |   |      |   |     |      |  |   | 9,042 |   |  |   |        |  |  |   |        |   |  |   | 9,042   | 
|Property and equipment                                                            |  |                                         | 23,429 |  |         |   | 22,602 |               |  |   | 21,585 |  |  |      | 6,688   |  |      |   | 6,506   |      |  |   | 5,670  |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   | 30,117  |  |  |   | 29,108  |   |  |   | 27,255  | 
|Goodwill                                                                          |  |                                         | 2,727  |  |         |   | 2,514  |               |  |   | 2,258  |  |  |      | 12,736  |  |      |   | 12,851  |      |  |   |       |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   | 15,463  |  |  |   | 15,365  |   |  |   | 2,258   | 
|Additions to property and equipment                                               |  |                                         | 2,764  |  |         |   | 1,934  |               |  |   | 2,409  |  |  |      | 1,798   |  |      |   | 2,128   |      |  |   | 1,782  |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   | 4,562   |  |  |   | 4,062   |   |  |   | 4,191   | 
|Additions to goodwill                                                             |  |                                         |       |  |         |   |       |               |  |   |       |  |  |      |        |  |      |   | 13,124  |      |  |   |       |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   |        |  |  |   | 13,124  |   |  |   |        | 
|Additions to intangible assets                                                    |  |                                         | 74     |  |         |   | 14     |               |  |   | 4      |  |  |      |        |  |      |   | 168     |      |  |   |       |   |  |      |       |   |      |   |     |      |  |   |      |   |  |   | 74      |  |  |   | 182     |   |  |   | 4       | 



|    |                            
|--- | ---------------------------
|20. | Related party transactions:



|              |                                                                                                  |                    |   |       |      |  |   |       |  |  |   |     | 
|------------- | ------------------------------------------------------------------------------------------------ | ------------------ | - | ----- | ---- |  | - | ----- |  |  | - | --- | 
|              |                                                                                                  | 2005               |   |       | 2004 |  |   | 2003  | 
|              |                                                                                                  |                    |   |       |      |  |   |       | 
|              |                                                                                                  | (Amounts in 000s) |  
|Transactions: |                                                                                                  |                    |   |       |      |  |   |       |  |  |   |    
|              | Purchases of inventory from supplier related to preferred
    shareholder                        |                    | $ | 5,999 |      |  | $ | 1,993 |  |  | $ | 711 | 
|              | Purchases of inventory from a company under common control                                       |                    |   |      |      |  |   | 85    |  |  |   | 200 | 
|              | Management fees to Iniziativa S.A. and Regaluxe Investment
    S.à.r.l.                          |                    |   | 916   |      |  |   | 842   |  |  |   | 614 | 
|              | Interest expense on convertible note payable to the parent
    company and preferred shareholder |                    |   | 50    |      |  |   | 50    |  |  |   | 26  | 
|              | Interest expense on subordinated loan from Regaluxe Investment
    S.à.r.l.                      |                    |   | 203   |      |  |   | 7     |  |  |   |    | 
|              | Interest expense on loan payable to shareholder                                                  |                    |   | 11    |      |  |   | 22    |  |  |   | 19  | 

|          |                  |      |   |           |      |  |   |           | 
|--------- | ---------------- | ---- | - | --------- | ---- |  | - | --------- | 
|          |                  | 2005 |   |           | 2004 | 
|          |                  |      |   |           |      | 
|Balances: |                  |      |   |           |      |  |   |          
|          | Accounts payable |      | $ | 1,104,000 |      |  | $ | 1,761,000 | 





F-32



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)


















|    |                       
|--- | ----------------------
|21. | Financial instruments:



|    |                     
|--- | --------------------
|(a) | Economic dependence:





|    |                              
|--- | -----------------------------
|(b) | Concentration of credit risk:





|    |                    
|--- | -------------------
|(c) | Interest rate risk:





|    |                                     
|--- | ------------------------------------
|(d) | Fair value of financial instruments:

Disclosure About Fair
Value Financial Instruments.


F-33



---



##### Table of Contents



HENRY BIRKS & SONS INC. AND SUBSIDIARIES


Notes to Consolidated Financial
Statements  (Continued)










|    |                             
|--- | ----------------------------
|(e) | Commodity and currency risk:





|    |                  
|--- | -----------------
|22. | Subsequent Event:







F-34



---



##### Table of Contents






REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM














| |             
| | ------------
| | /s/ KPMG LLP





F-35



---



##### Table of Contents






REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


















| |                             
| | ----------------------------
| | /s/ DELOITTE & TOUCHE LLP   
| | Certified Public Accountants

Miami, Florida




F-36



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





CONSOLIDATED BALANCE SHEETS


|                                                                                                                                                                                      |                                            |                            |          |         |           |   |          |         | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | -------------------------- | -------- | ------- | --------- | - | -------- | ------- | 
|                                                                                                                                                                                      |                                            | March 26,                  |          |         | March 27, |  
|                                                                                                                                                                                      |                                            | 2005                       |          |         | 2004      |  
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      |                                            | (Amounts shown in          |         
|                                                                                                                                                                                      |                                            | thousands except share and |         
|                                                                                                                                                                                      |                                            | per share data)            |         
|ASSETS                                                                                                                                                                               
|Current Assets:                                                                                                                                                                       |                                            |                            |          |         |           |   |          |        
|Cash and cash equivalents                                                                                                                                                             |                                            | $                          | 1,220    |         |           | $ | 1,448    |        
|Accounts receivable (net of allowance for doubtful accounts of
    $962 and $999, at March 26, 2005 and March 27, 2004,
    respectively)                                             |                                            |                            | 6,936    |         |           |   | 6,446    |        
|Inventories                                                                                                                                                                           |                                            |                            | 80,439   |         |           |   | 80,825   |        
|Other current assets                                                                                                                                                                  |                                            |                            | 632      |         |           |   | 1,194    |        
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total current assets                       |                            |          | 89,227  |           |   |          | 89,913  | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|Property, net                                                                                                                                                                         |                                            |                            | 13,143   |         |           |   | 14,634   |        
|Other assets                                                                                                                                                                          |                                            |                            | 416      |         |           |   | 668      |        
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total non-current assets                   |                            |          | 13,559  |           |   |          | 15,302  | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total assets                               |                            | $        | 102,786 |           |   | $        | 105,215 | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                     
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                                                 
|Current Liabilities:                                                                                                                                                                  |                                            |                            |          |         |           |   |          |        
|Accounts payable                                                                                                                                                                      |                                            | $                          | 13,139   |         |           | $ | 13,833   |        
|Accrued expenses                                                                                                                                                                      |                                            |                            | 6,786    |         |           |   | 9,457    |        
|Credit facility                                                                                                                                                                       |                                            |                            | 33,501   |         |           |   | 33,005   |        
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total current liabilities                  |                            |          | 53,426  |           |   |          | 56,295  | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|Term loan                                                                                                                                                                             |                                            |                            | 12,668   |         |           |   | 12,668   |        
|Other long term liabilities                                                                                                                                                           |                                            |                            | 2,401    |         |           |   | 2,768    |        
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total long term liabilities                |                            |          | 15,069  |           |   |          | 15,436  | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|Commitments and contingencies (Notes M and N)                                                                                                                                         |                                            |                            |         |         |           |   |         |        
|Stockholders Equity:                                                                                                                                                                 |                                            |                            |          |         |           |   |          |        
|Series A-1 convertible preferred stock, $.001 par
    value, 15,050 authorized, issued and outstanding at
    March 26, 2005 and March 27, 2004, liquidation value
    of $15,050,000 |                                            |                            |         |         |           |   |         |        
|Common stock, $.0001 par value, 50,000,000 shares
    authorized, 46,975,546 and 46,945,261 shares issued, at
    March 26, 2005 and March 27, 2004, respectively                     |                                            |                            | 5        |         |           |   | 5        |        
|Additional paid-in capital                                                                                                                                                            |                                            |                            | 207,100  |         |           |   | 206,981  |        
|Accumulated deficit                                                                                                                                                                   |                                            |                            | (143,414 | )       |           |   | (144,102 | )      
|Less: 9,983,954 shares of treasury stock, at cost                                                                                                                                     |                                            |                            | (29,400  | )       |           |   | (29,400  | )      
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total stockholders equity                 |                            |          | 34,291  |           |   |          | 33,484  | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  
|                                                                                                                                                                                      | Total liabilities and stockholders equity |                            | $        | 102,786 |           |   | $        | 105,215 | 
|                                                                                                                                                                                      |                                            |                            |          |         |           |  



F-37



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF OPERATIONS


|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |        |   |         |            |        | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------- | -------------------------------------------- | ------- | ---------- | ----------- | ------------- | ------- | ----------- | ------ | - | ------- | ---------- | ------ | 
|                                                                                                                                                                    |                         | Fiscal Year                                  |         |            | Fiscal Year |               |         | Fiscal Year |       
|                                                                                                                                                                    |                         | Ended                                        |         |            | Ended       |               |         | Ended       |       
|                                                                                                                                                                    |                         | March 26,                                    |         |            | March 27,   |               |         | March 29,   |       
|                                                                                                                                                                    |                         | 2005                                         |         |            | 2004        |               |         | 2003        |       
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|                                                                                                                                                                    |                         |                                              |         |            |             | (As restated, |        
|                                                                                                                                                                    |                         |                                              |         |            |             | see note B)   |        
|                                                                                                                                                                    |                         | (Amounts shown in thousands except share and |        
|                                                                                                                                                                    |                         | per share data)                              |        
|Net sales                                                                                                                                                           |                         | $                                            | 142,710 |            |             | $             | 125,487 |             |        | $ | 118,391 |           
|Cost of sales                                                                                                                                                       |                         |                                              | 81,715  |            |             |               | 73,427  |             |        |   | 78,740  |           
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Gross profit                                                                                                                                                        |                         |                                              | 60,995  |            |             |               | 52,060  |             |        |   | 39,651  |           
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Selling, general and administrative expenses (including non-cash
    compensation expense, net of $103 and $1,067 for Fiscal 2004 and
    Fiscal 2003, respectively |                         |                                              | 53,729  |            |             |               | 52,283  |             |        |   | 53,719  |           
|Restructuring, asset impairments and other charges                                                                                                                  |                         |                                              | (1,212  | )          |             |               |        |             |        |   | 2,887   |           
|Depreciation and amortization                                                                                                                                       |                         |                                              | 3,289   |            |             |               | 3,358   |             |        |   | 4,177   |           
|Goodwill impairment writedown                                                                                                                                       |                         |                                              |        |            |             |               |        |             |        |   | (615    | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|                                                                                                                                                                    |                         | Total operating expenses                     |         |            | 55,806      |               |         |             | 55,641 |   |         |            | 60,168 | 
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Operating income (loss)                                                                                                                                             |                         |                                              | 5,189   |            |             |               | (3,581  | )           |        |   | (20,517 | )         
|Interest and other income                                                                                                                                           |                         |                                              |        |            |             |               | 184     |             |        |   | 1,433   |           
|Interest and other financial costs                                                                                                                                  |                         |                                              | (4,501  | )          |             |               | (4,427  | )           |        |   | (6,757  | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Income (loss) from continuing operations before income taxes                                                                                                        |                         |                                              | 688     |            |             |               | (7,824  | )           |        |   | (25,841 | )         
|Income tax benefit                                                                                                                                                  |                         |                                              |        |            |             |               |        |             |        |   | (547    | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Income (loss) from continuing operations                                                                                                                            |                         |                                              | 688     |            |             |               | (7,824  | )           |        |   | (25,294 | )         
|Loss from discontinued operations, net of income tax expense of
    $393 in Fiscal 2002                                                                             |                         |                                              |        |            |             |               |        |             |        |   | (1,604  | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Net income (loss)                                                                                                                                                   |                         |                                              | 688     |            |             |               | (7,824  | )           |        |   | (26,898 | )         
|Preferred stock cumulative dividend                                                                                                                                 |                         |                                              | (100    | )          |             |               | (1,316  | )           |        |   | (872    | )         
|Preferred stock beneficial conversion, value treated as a
    dividend (See Note B)                                                                                 |                         |                                              |        |            |             |               |        |             |        |   | (3,539  | )         
|Relative fair value of warrants, value treated as a dividend                                                                                                        |                         |                                              |        |            |             |               |        |             |        |   | (3,539  | )         
|Value of the increase in the Series A Preferred conversion
    ratio and the additional warrants issued to Birks                                                    |                         |                                              | (17     | )          |             |               |        |             |        |   | (441    | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Net income (loss) attributable to common stockholders                                                                                                               |                         | $                                            | 571     |            |             | $             | (9,140  | )           |        | $ | (35,289 | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Weighted average shares outstanding                                                                                                                                 |                         |                                              |         |            |             |               |         |             |        |   |         |           
|                                                                                                                                                                    | Basic                   |                                              |         | 36,968,296 |             |               |         | 26,377,886  |        |   |         | 19,568,006 |       
|                                                                                                                                                                    | Diluted                 |                                              |         | 93,177,445 |             |               |         | 26,377,886  |        |   |         | 19,568,006 |       
|Income (loss) per share, basic:                                                                                                                                     |                         |                                              |         |            |             |               |         |             |        |   |         |           
|                                                                                                                                                                    | Continuing operations   |                                              | $       | 0.02       |             |               | $       | (0.35       | )      |   | $       | (1.72      | )     
|                                                                                                                                                                    | Discontinued operations |                                              |         | 0.00       |             |               |         | (0.00       | )      |   |         | (0.08      | )     
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|                                                                                                                                                                    |                         | $                                            | 0.02    |            |             | $             | (0.35   | )           |        | $ | (1.80   | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|Income (loss) per share, diluted:                                                                                                                                   |                         |                                              |         |            |             |               |         |             |        |   |         |           
|                                                                                                                                                                    | Continuing operations   |                                              | $       | 0.01       |             |               | $       | (0.35       | )      |   | $       | (1.72      | )     
|                                                                                                                                                                    | Discontinued operations |                                              |         | 0.00       |             |               |         | (0.00       | )      |   |         | (0.08      | )     
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       
|                                                                                                                                                                    |                         | $                                            | 0.01    |            |             | $             | (0.35   | )           |        | $ | (1.80   | )         
|                                                                                                                                                                    |                         |                                              |         |            |             |               |         |             |       



F-38



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY


|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |   |         |   |   |         |   |  |   |        |         |  
|----------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------ | ---------------------------------------- | ------- | ---------- | ----------- | - | - | ----------- |  |  | ---------- | - | ---------- | ------- | - | - | ----------- | - | ------- | ------------- | - | - | -------- | ------- | - | ----- | - | ------- | - | - | ------- | - |  | - | ------ | ------- | -
|                                                                                                                                                      |                                                        |                                          |         | Series A/  |             |   |   |             |  |  |            |   |            |         |   |   |             |   |        
|                                                                                                                                                      |                                                        |                                          |         | Series A-1 |             |   |   |             |  |  |            |   |            |         |   |   |             |   |        
|                                                                                                                                                      |                                                        | Preferred                                |         |            | Convertible |   |   | Common      |  |  |            |   | Additional |         |   |   |             |   |         |               |   |  
|                                                                                                                                                      |                                                        | Shares                                   |         |            | Preferred   |   |   | Shares      |  |  | Common     |   |            | Paid-In |   |   | Accumulated |   |         | Comprehensive |   |   | Treasury |         |   |      
|                                                                                                                                                      |                                                        | Outstanding                              |         |            | Stock       |   |   | Outstanding |  |  | Stock      |   |            | Capital |   |   | Deficit     |   |         | (Loss) Income |   |   | Stock    |         |   | Total |  
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|                                                                                                                                                      |                                                        | (Amounts in thousands except share data) |        
|BALANCE AT MARCH 30, 2002                                                                                                                             |                                                        |                                          | 0       |            |             | $ | 0 |             |  |  | 19,525,749 |   |            | $       | 3 |   |             | $ | 194,527 |               |   | $ | (109,380 | )       |   |       |   |         |   | $ | (29,400 | ) |  | $ | 55,750 |        
|Comprehensive loss:                                                                                                                                   |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |   |         |   |   |         |   |  |   |        |        
|                                                                                                                                                      | Net loss                                               |                                          |         |           |             |   |   |            |  |  |            |  |            |         |   |  |             |   |         |              |   |   |          | (26,898 | ) |       | $ | (26,898 | ) |   |         |  |  |   |        | (26,898 | )
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|Common stock issued pursuant to Employee Stock Purchase Plan                                                                                          |                                                        |                                          |        |            |             |   |  |             |  |  | 82,561     |   |            |         |  |   |             |   | 23      |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 23     |        
|Sale of Series A Convertible Preferred Stock and warrants,
    net (See Note L)                                                                       |                                                        |                                          | 15,050  |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 13,552  |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 13,552 |        
|Recognition of relative fair value of warrants (as Restated)                                                                                          |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 3,539   |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 3,539  |        
|Non-cash dividend for relative fair value of warrants (as
    Restated)                                                                               |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | (3,539  | )             |   |   |         |         |   |       |   |         |   |   |        |   |  |   | (3,539 | )      
|Recognition of beneficial conversion value of Series A
    Convertible Preferred Stock (as Restated)                                                  |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 3,539   |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 3,539  |        
|Non-cash dividend for beneficial conversion feature of
    Series A (as Restated)                                                                     |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | (3,539  | )             |   |   |         |         |   |       |   |         |   |   |        |   |  |   | (3,539 | )      
|Recognition of the value of the increase in the Series A
    Preferred conversion ratio and the additional warrants issued to
    Birks (as Restated) |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 441     |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 441    |        
|Non-cash dividend for the value of the increase in the
    Series A Preferred conversion ratio and the additional
    warrants (as Restated)          |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | (441    | )             |   |   |         |         |   |       |   |         |   |   |        |   |  |   | (441   | )      
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|BALANCE AT MARCH 29, 2003                                                                                                                             |                                                        |                                          | 15,050  |            |             |   | 0 |             |  |  | 19,608,310 |   |            |         | 3 |   |             |   | 208,102 |               |   |   | (136,278 | )       |   |       |   |         |   |   | (29,400 | ) |  |   | 42,427 |        
|Comprehensive loss:                                                                                                                                   |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |   |         |   |   |         |   |  |   |        |        
|                                                                                                                                                      | Net loss                                               |                                          |         |           |             |   |   |            |  |  |            |  |            |         |   |  |             |   |         |              |   |   |          | (7,824  | ) |       | $ | (7,824  | ) |   |         |  |  |   |        | (7,824  | )
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|Cashless exercise of warrants                                                                                                                         |                                                        |                                          |        |            |             |   |  |             |  |  | 17,352,997 |   |            |         | 2 |   |             |   | (2      | )             |   |   |         |         |   |       |   |         |   |   |        |   |  |   |       |        
|Non-cash compensation expense related to warrants and Birks sale
    of stock (See Note L)                                                            |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 1,067   |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 1,067  |        
|Exchange of Series A Convertible Preferred Stock                                                                                                      |                                                        |                                          | (15,050 | )          |             |   |  |             |  |  |           |   |            |         |  |   |             |   |        |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   |       |        
|Issuance of Series A-1 Convertible Preferred Stock                                                                                                    |                                                        |                                          | 15,050  |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   |        |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   |       |        
|Dividend payment                                                                                                                                      |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | (2,186  | )             |   |   |         |         |   |       |   |         |   |   |        |   |  |   | (2,186 | )      
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|BALANCE AT MARCH 27, 2004                                                                                                                             |                                                        |                                          | 15,050  |            |             |   | 0 |             |  |  | 36,961,307 |   |            |         | 5 |   |             |   | 206,981 |               |   |   | (144,102 | )       |   |       |   |         |   |   | (29,400 | ) |  |   | 33,484 |        
|Comprehensive income:                                                                                                                                 |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |   |         |   |   |         |   |  |   |        |        
|                                                                                                                                                      | Net income                                             |                                          |         |           |             |   |   |            |  |  |            |  |            |         |   |  |             |   |         |              |   |   |          | 688     |   |       | $ | 688     |   |   |         |  |  |   |        | 688     |  
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|Common stock issued pursuant to Employee Stock Purchase Plan                                                                                          |                                                        |                                          |        |            |             |   |  |             |  |  | 30,285     |   |            |         |  |   |             |   | 16      |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 16     |        
|Non-cash compensation (credit) related to warrants and
    Birks sale of stock, net (See Note L)                                                      |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 103     |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 103    |        
|Recognition of the value of the increase in the Series A
    Preferred conversion ratio and the additional warrants issued to
    Birks               |                                                        |                                          |        |            |             |   |  |             |  |  |           |   |            |         |  |   |             |   | 17      |               |   |   |         |         |   |       |   |         |   |   |        |   |  |   | 17     |        
|Non-cash dividend for the value of the increase in the
    Series A                                                                                   |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |   |         |   |   |         |   |  |   |        |        
|                                                                                                                                                      | Preferred conversion ratio and the additional warrants |                                          |         |           |             |   |   |            |  |  |            |  |            |         |   |  |             |   |         | (17           | ) |   |          |        |   |       |   |         |   |   |         |  |  |   |        | (17     | )
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  
|BALANCE AT MARCH 26, 2005                                                                                                                             |                                                        |                                          | 15,050  |            |             | $ | 0 |             |  |  | 36,991,592 |   |            | $       | 5 |   |             | $ | 207,100 |               |   | $ | (143,414 | )       |   |       |   |         |   | $ | (29,400 | ) |  | $ | 34,291 |        
|                                                                                                                                                      |                                                        |                                          |         |            |             |   |   |             |  |  |            |   |            |         |   |   |             |   |         |               |   |   |          |         |   |       |  



F-39



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF CASH FLOWS


|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |          |  
|------------------------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------- | ------ | -------- | ----------- | ------------- | ------ | ----------- | - | - | ------- | -------- | -
|                                                                                                       |                                                                                                                                                | Fiscal Year                  |        |          | Fiscal Year |               |        | Fiscal Year |  
|                                                                                                       |                                                                                                                                                | Ended                        |        |          | Ended       |               |        | Ended       |  
|                                                                                                       |                                                                                                                                                | March 26,                    |        |          | March 27,   |               |        | March 29,   |  
|                                                                                                       |                                                                                                                                                | 2005                         |        |          | 2004        |               |        | 2003        |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             | (As restated, |       
|                                                                                                       |                                                                                                                                                |                              |        |          |             | see note B)   |       
|                                                                                                       |                                                                                                                                                | (Amounts shown in thousands) |       
|Cash flow from operating activities                                                                    |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|Net income (loss)                                                                                      |                                                                                                                                                | $                            | 688    |          |             | $             | (7,824 | )           |   | $ | (26,898 | )       
|Deduct loss from discontinued operations                                                               |                                                                                                                                                |                              |       |          |             |               |       |             |   |   | (1,604  | )       
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Income (loss) from continuing operations                                                               |                                                                                                                                                |                              | 688    |          |             |               | (7,824 | )           |   |   | (25,294 | )       
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activities: |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Depreciation and amortization                                                                                                                  |                              |        | 3,289    |             |               |        | 3,358       |   |   |         | 4,177    |  
|                                                                                                       | Amortization of debt costs                                                                                                                     |                              |        | 604      |             |               |        | 432         |   |   |         | 531      |  
|                                                                                                       | Provision for doubtful accounts                                                                                                                |                              |        | 274      |             |               |        | 269         |   |   |         | 2,785    |  
|                                                                                                       | Goodwill impairment writedown                                                                                                                  |                              |        |         |             |               |        |            |   |   |         | (615     | )
|                                                                                                       | Closing stores asset writedown                                                                                                                 |                              |        |         |             |               |        |            |   |   |         | (1,935   | )
|                                                                                                       | Write-off of deferred financing costs                                                                                                          |                              |        |         |             |               |        |            |   |   |         | 2,055    |  
|                                                                                                       | Non-cash compensation expense related to warrants and Birks sale
    of stock, net                                                             |                              |        | 103      |             |               |        | 1,067       |   |   |         |         |  
|(Increase) decrease in assets:                                                                         |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Net proceeds from sale of private label credit card receivables                                                                                |                              |        |         |             |               |        |            |   |   |         | 12,147   |  
|                                                                                                       | Accounts receivable                                                                                                                            |                              |        | (764     | )           |               |        | (938        | ) |   |         | 3,148    |  
|                                                                                                       | Inventories                                                                                                                                    |                              |        | 386      |             |               |        | (4,072      | ) |   |         | 615      |  
|                                                                                                       | Other assets                                                                                                                                   |                              |        | 567      |             |               |        | 1,770       |   |   |         | (1,517   | )
|Increase (decrease) in liabilities:                                                                    |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Accounts payable                                                                                                                               |                              |        | (694     | )           |               |        | 35          |   |   |         | 2,598    |  
|                                                                                                       | Accrued expenses and other long term liabilities                                                                                               |                              |        | (3,038   | )           |               |        | 1,745       |   |   |         | 1,527    |  
|                                                                                                       | Accrued restructuring                                                                                                                          |                              |        |         |             |               |        |            |   |   |         | (6,554   | )
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Net cash provided by (used in) continuing operations                                                   |                                                                                                                                                |                              | 1,415  |          |             |               | (4,158 | )           |   |   | (6,332  | )       
|Net cash used in discontinued operations                                                               |                                                                                                                                                |                              |       |          |             |               | (527   | )           |   |   | (128    | )       
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Net cash provided by (used in) operating activities                                                    |                                                                                                                                                |                              | 1,415  |          |             |               | (4,685 | )           |   |   | (6,460  | )       
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Cash flows from investing activities:                                                                  |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Proceeds from sales of fixed assets                                                                                                            |                              |        | 18       |             |               |        | 74          |   |   |         | 5,547    |  
|                                                                                                       | Capital expenditures, net                                                                                                                      |                              |        | (1,816   | )           |               |        | (2,194      | ) |   |         | (2,014   | )
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Net cash (used in) provided by investing activities                                                    |                                                                                                                                                |                              | (1,798 | )        |             |               | (2,120 | )           |   |   | 3,533   |         
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Cash flows from financing activities:                                                                  |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Borrowings under line of credit                                                                                                                |                              |        | 143,593  |             |               |        | 136,434     |   |   |         | 160,913  |  
|                                                                                                       | Line of credit repayments                                                                                                                      |                              |        | (143,097 | )           |               |        | (126,712    | ) |   |         | (172,656 | )
|                                                                                                       | Principal borrowings on term loan                                                                                                              |                              |        |         |             |               |        | 2,000       |   |   |         |         |  
|                                                                                                       | Principal payment on term loan                                                                                                                 |                              |        |         |             |               |        | (2,000      | ) |   |         |         |  
|                                                                                                       | Proceeds from issuance of preferred convertible stock and
    warrants, net                                                                    |                              |        |         |             |               |        |            |   |   |         | 13,552   |  
|                                                                                                       | Proceeds from sale of stock under employee purchase plans                                                                                      |                              |        | 16       |             |               |        |            |   |   |         | 23       |  
|                                                                                                       | Payment of commitment fee                                                                                                                      |                              |        | (357     | )           |               |        | (341        | ) |   |         | (650     | )
|                                                                                                       | Dividend paid to preferred stockholders                                                                                                        |                              |        |         |             |               |        | (2,186      | ) |   |         |         |  
|                                                                                                       | Other                                                                                                                                          |                              |        |         |             |               |        |            |   |   |         | 41       |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Net cash provided by financing activities                                                              |                                                                                                                                                |                              | 155    |          |             |               | 7,195  |             |   |   | 1,223   |         
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Net (decrease) increase in cash and cash equivalents                                                   |                                                                                                                                                |                              | (228   | )        |             |               | 390    |             |   |   | (1,704  | )       
|Cash and cash equivalents at beginning of year                                                         |                                                                                                                                                |                              | 1,448  |          |             |               | 1,058  |             |   |   | 2,762   |         
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Cash and cash equivalents at end of year                                                               |                                                                                                                                                | $                            | 1,220  |          |             | $             | 1,448  |             |   | $ | 1,058   |         
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Supplemental cash flow information:                                                                    |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Interest paid                                                                                                                                  |                              | $      | 3,597    |             |               | $      | 4,383       |   |   | $       | 4,605    |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|                                                                                                       | Income taxes received                                                                                                                          |                              | $      |         |             |               | $      |            |   |   | $       | (91      | )
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|Non-cash investing and financing activities:                                                           |                                                                                                                                                |                              |        |          |             |               |        |             |   |   |         |         
|                                                                                                       | Property acquired with debt                                                                                                                    |                              | $      | 311      |             |               | $      | 130         |   |   | $       |         |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|                                                                                                       | Par value of 17,352,997 shares of common stock issued
    pursuant to cashless exercise of warrants                                            |                              | $      |         |             |               | $      | 2           |   |   | $       |         |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|                                                                                                       | Non-cash dividend for relative fair value of warrants                                                                                          |                              | $      |         |             |               | $      |            |   |   | $       | 3,539    |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|                                                                                                       | Non-cash dividend for beneficial conversion feature of Series a
    Convertible Preferred Stock                                                |                              | $      |         |             |               | $      |            |   |   | $       | 3,539    |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  
|                                                                                                       | Non-cash dividend for the value of the increase in the Series a
    Preferred conversion ratio and the additional warrants issued to
    Birks |                              | $      | 17       |             |               | $      |            |   |   | $       | 441      |  
|                                                                                                       |                                                                                                                                                |                              |        |          |             |               |        |             |  



F-40



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS


Fiscal Years Ended March 26, 2005, March 27, 2004
and March 29, 2003




|   |                    
|-- | -------------------
|A. | NATURE OF BUSINESS:







|   |             
|-- | ------------
|B. | RESTATEMENT:











|                                                                                                                 |                                    |                         |         |   |               |   |         |   |       |  
|---------------------------------------------------------------------------------------------------------------- | ---------------------------------- | ----------------------- | ------- | - | ------------- | - | ------- | - | ----- | -
|                                                                                                                 |                                    | Year Ended              |        
|                                                                                                                 |                                    | March 29, 2003          |        
|                                                                                                                 |                                    |                         |        
|                                                                                                                 |                                    | (As Previously          |         |   |              
|                                                                                                                 |                                    | Reported)               |         |   | (As Restated) |  
|                                                                                                                 |                                    |                         |         |   |               |  
|Net loss                                                                                                         |                                    | $                       | (26,898 | ) |               | $ | (26,898 | )
|Preferred stock cumulative dividend                                                                              |                                    |                         | (872    | ) |               |   | (872    | )
|Preferred stock beneficial conversion, value treated as dividend                                                 |                                    |                         | (3,797  | ) |               |   | (3,539  | )
|Relative fair value of warrants, value treated as dividend                                                       |                                    |                         |        |   |               |   | (3,539  | )
|Value of the increase in the Series A Preferred conversion
    ratio and the additional warrants issued to Birks |                                    |                         |        |   |               |   | (441    | )
|                                                                                                                 |                                    |                         |         |   |               |  
|Net loss attributable to common stockholders                                                                     |                                    | $                       | (31,567 | ) |               | $ | (35,289 | )
|                                                                                                                 |                                    |                         |         |   |               |  
|                                                                                                                 | Loss per share, basic and diluted: |                         |         |   |               |   |         |   |      
|                                                                                                                 |                                    | Continuing operations   |         | $ | (1.53         | ) |         | $ | (1.72 | )
|                                                                                                                 |                                    | Discontinued operations |         |   | (0.08         | ) |         |   | 0.08  | )
|                                                                                                                 |                                    |                         |         |   |               |  
|                                                                                                                 |                                    | $                       | (1.61   | ) |               | $ | (1.80   | )
|                                                                                                                 |                                    |                         |         |   |               |  

F-41



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                                                     |                                                                 |                |         |        |               |  |        |        | 
|---------------------------------------------------- | --------------------------------------------------------------- | -------------- | ------- | ------ | ------------- |  | ------ | ------ | 
|                                                     |                                                                 | Year Ended     |        
|                                                     |                                                                 | March 29, 2003 |        
|                                                     |                                                                 |                |        
|                                                     |                                                                 | (As Previously |         |        |              
|                                                     |                                                                 | Reported)      |         |        | (As Restated) | 
|                                                     |                                                                 |                |         |        |               | 
|Cash flow from operating activities                  |                                                                 |                |         |        |               |  |        |       
|(Increase) decrease in assets:                       |                                                                 |                |         |        |               |  |        |       
|                                                     | Net proceeds from sale of private label credit card receivables |                |         |       |               |  |        | 12,147 | 
|Net cash (used in) provided by continuing operations |                                                                 |                | (18,479 | )      |               |  | (6,332 | )     
|Net cash (used in) provided by operating activities  |                                                                 |                | (18,607 | )      |               |  | (6,460 | )     
|Cash flows from investing activities:                |                                                                 |                |         |        |               |  |        |       
|                                                     | Net proceeds from sale of private label credit card receivables |                |         | 12,147 |               |  |        |       | 
|Net cash provided by (used in) financing activities  |                                                                 |                | 13,370  |        |               |  | 1,223  |       



|   |                                            
|-- | -------------------------------------------
|C. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Principles of Consolidation


Significant Estimates


Concentration of Risk


Revenue Recognition


Cash and Cash Equivalents


Accounts Receivable


F-42



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




Inventories


Property


|                               |  |             |         | 
|------------------------------ |  | ----------- | ------- | 
|                               |  | Estimated   |        
|Asset                          |  | Useful Life |        
|                               |  |             |        
|Furniture and fixtures         |  |             | 5 years | 
|Automobiles and trucks         |  |             | 3 years | 
|Computer hardware and software |  |             | 3 years | 



Leases 


Income Taxes


Long-lived Assets


Deferred Financing Costs


F-43



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


Cost of Sales


Advertising Costs


Pre-opening Expenses


Comprehensive Income (Loss)


Reclassifications


Accounting for Stock-Based
Compensation Accounting for
Stock Issued to Employees, Accounting for Stock-Based Compensation, Accounting for
Stock-Based Compensation  Transition and
Disclosure,


|                                                                                                                  |                    |                         |      |   |        |   |        |        |       |   |         |   |       |  
|----------------------------------------------------------------------------------------------------------------- | ------------------ | ----------------------- | ---- | - | ------ | - | ------ | ------ | ----- | - | ------- | - | ----- | -
|                                                                                                                  |                    | Fiscal                  |      |   | Fiscal |   |        | Fiscal |      
|                                                                                                                  |                    | 2004                    |      |   | 2003   |   |        | 2002   |      
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      
|Continuing operations                                                                                             |                    | $                       | 571  |   |        | $ | (9,140 | )      |       | $ | (29,963 | )
|Discontinued operations                                                                                           |                    |                         |     |   |        |   |       |        |       |   | (1,604  | )
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      
|Net income (loss) attributable to common stockholders as reported                                                 |                    |                         | 571  |   |        |   | (9,140 | )      |       |   | (31,567 | )
|Adjust for non-cash compensation expense for warrants recorded
    pursuant to APB 25                             |                    |                         | (32  | ) |        |   | 867    |        |       |   |        |  
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      
|Adjusted net income (loss)                                                                                        |                    |                         | 539  |   |        |   | (8,273 | )      |       |   | (31,567 | )
|Stock-based employee compensation expense determined under
    fair-value-based method for all awards, net of tax |                    |                         | (232 | ) |        |   | (1,495 | )      |       |   | (733    | )
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      
|Proforma net income (loss)                                                                                        |                    | $                       | 307  |   |        | $ | (9,768 | )      |       | $ | (32,300 | )
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      
|Income (loss) per share                                                                                           |                    |                         |      |   |        |   |        |        |       |   |         |  
|                                                                                                                  | As reported basic: |                         |      |   |        |   |        |        |       |   |         |   |      
|                                                                                                                  |                    | Continuing operations   |      | $ | 0.02   |   |        | $      | (0.35 | ) |         | $ | (1.53 | )
|                                                                                                                  |                    | Discontinued operations |      |   | 0.00   |   |        |        | (0.00 | ) |         |   | (0.08 | )
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      
|                                                                                                                  |                    | $                       | 0.02 |   |        | $ | (0.35  | )      |       | $ | (1.61   | )
|                                                                                                                  |                    |                         |      |   |        |   |        |        |      

F-44



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)


|                     |                         |        |      |      |        |   |       |        |   |   |       |       |  
|-------------------- | ----------------------- | ------ | ---- | ---- | ------ | - | ----- | ------ | - | - | ----- | ----- | -
|                     |                         | Fiscal |      |      | Fiscal |   |       | Fiscal |  
|                     |                         | 2004   |      |      | 2003   |   |       | 2002   |  
|                     |                         |        |      |      |        |   |       |        |  
|As reported diluted: |                         |        |      |      |        |   |       |        |   |   |       |      
|                     | Continuing operations   |        | $    | 0.01 |        |   | $     | (0.35  | ) |   | $     | (1.53 | )
|                     | Discontinued operations |        |      | 0.00 |        |   |       | (0.00  | ) |   |       | (0.08 | )
|                     |                         | $      | 0.01 |      |        | $ | (0.35 | )      |   | $ | (1.61 | )    
|Proforma basic:      |                         |        |      |      |        |   |       |        |   |   |       |      
|                     | Continuing operations   |        | $    | 0.01 |        |   | $     | (0.37  | ) |   | $     | (1.57 | )
|                     | Discontinued operations |        |      | 0.00 |        |   |       | (0.00  | ) |   |       | (0.08 | )
|                     |                         |        |      |      |        |   |       |        |  
|                     |                         | $      | 0.01 |      |        | $ | (0.37 | )      |   | $ | (1.65 | )    
|                     |                         |        |      |      |        |   |       |        |  
|Proforma diluted:    |                         |        |      |      |        |   |       |        |   |   |       |      
|                     | Continuing operations   |        | $    | 0.00 |        |   | $     | (0.37  | ) |   | $     | (1.57 | )
|                     | Discontinued operations |        |      | 0.00 |        |   |       | (0.00  | ) |   |       | (0.08 | )
|                     |                         |        |      |      |        |   |       |        |  
|                     |                         | $      | 0.00 |      |        | $ | (0.37 | )      |   | $ | (1.65 | )    
|                     |                         |        |      |      |        |   |       |        |  



Newly Issued Accounting Standards




F-45



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






Earnings (Loss) Per Share




|   |                                                    
|-- | ---------------------------------------------------
|D. | RESTRUCTURING, ASSET IMPAIRMENTS AND OTHER CHARGES:







|   |                               
|-- | ------------------------------
|E. | GOODWILL IMPAIRMENT WRITEDOWN:



F-46



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                         
|-- | ------------------------
|F. | DISCONTINUED OPERATIONS:





|   |                             
|-- | ----------------------------
|G. | SALE OF ACCOUNTS RECEIVABLE:





|   |             
|-- | ------------
|H. | INVENTORIES:



|               |  |                   |        |  |           |   |        | 
|-------------- |  | ----------------- | ------ |  | --------- | - | ------ | 
|               |  | March 26,         |        |  | March 27, |  
|               |  | 2005              |        |  | 2004      |  
|               |  |                   |        |  |           |  
|               |  | Company           |        |  | Company   |  
|               |  | Owned             |        |  | Owned     |  
|               |  |                   |        |  |           |  
|               |  | (Amounts shown in |       
|               |  | thousands)        |       
|Raw materials  |  | $                 | 893    |  |           | $ | 1,415  | 
|Finished goods |  |                   | 79,546 |  |           |   | 79,410 | 
|               |  |                   |        |  |           |  
|               |  | $                 | 80,439 |  |           | $ | 80,825 | 
|               |  |                   |        |  |           |  





|   |          
|-- | ---------
|I. | PROPERTY:



|                               |  |                   |         |   |           |   |         |  
|------------------------------ |  | ----------------- | ------- | - | --------- | - | ------- | -
|                               |  | March 26,         |         |   | March 27, |  
|                               |  | 2005              |         |   | 2004      |  
|                               |  |                   |         |   |           |  
|                               |  | (Amounts shown in |        
|                               |  | thousands)        |        
|Furniture and fixtures         |  | $                 | 5,701   |   |           | $ | 5,532   |  
|Leasehold improvements         |  |                   | 27,951  |   |           |   | 27,266  |  
|Computer hardware and software |  |                   | 7,020   |   |           |   | 6,734   |  
|Automobiles and trucks         |  |                   | 15      |   |           |   | 83      |  
|                               |  |                   |         |   |           |  
|                               |  |                   | 40,687  |   |           |   | 39,615  |  
|Less accumulated depreciation  |  |                   | (27,544 | ) |           |   | (24,981 | )
|                               |  |                   |         |   |           |  
|                               |  | $                 | 13,143  |   |           | $ | 14,634  |  
|                               |  |                   |         |   |           |  

F-47



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |                               
|-- | ------------------------------
|J. | TERM LOAN AND CREDIT FACILITY:







|                                                      |  |                   |        |   |            |   |        |  
|----------------------------------------------------- |  | ----------------- | ------ | - | ---------- | - | ------ | -
|                                                      |  | Year Ended        |        |   | Year Ended |  
|                                                      |  | Mar. 26,          |        |   | Mar. 27,   |  
|                                                      |  | 2005              |        |   | 2004       |  
|                                                      |  |                   |        |   |            |  
|                                                      |  | (Amounts shown in |       
|                                                      |  | thousands)        |       
|Maximum borrowings outstanding during the fiscal year |  | $                 | 48,417 |   |            | $ | 39,955 |  
|Average outstanding balance during the fiscal year    |  | $                 | 35,178 |   |            | $ | 31,004 |  
|Weighted average interest rate for the fiscal year    |  |                   | 5.6    | % |            |   | 6.3    | %

F-48



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |              
|-- | -------------
|K. | INCOME TAXES:



|                       |                                                                                   |                   |        |         |           |   |        |         |  
|---------------------- | --------------------------------------------------------------------------------- | ----------------- | ------ | ------- | --------- | - | ------ | ------- | -
|                       |                                                                                   | March 26,         |        |         | March 27, |  
|                       |                                                                                   | 2005              |        |         | 2004      |  
|                       |                                                                                   |                   |        |         |           |  
|                       |                                                                                   | (Amounts shown in |       
|                       |                                                                                   | thousands)        |       
|Deferred Tax Assets:   |                                                                                   |                   |        |         |           |   |        |        
|                       | Difference between book and tax basis of property                                 |                   | $      | 4,799   |           |   | $      | 4,339   |  
|                       | Compensation expense on warrants                                                  |                   |        | 322     |           |   |        | 335     |  
|                       | Sales returns and doubtful accounts allowances not currently
    deductible       |                   |        | 436     |           |   |        | 472     |  
|                       | Inventory reserves not currently deductible                                       |                   |        | 1,401   |           |   |        | 2,578   |  
|                       | Federal net operating loss and tax credit carryforward                            |                   |        | 28,331  |           |   |        | 27,025  |  
|                       | State net operating loss carryforward                                             |                   |        | 3,697   |           |   |        | 3,351   |  
|                       | Other reserves not currently deductible                                           |                   |        | 1,784   |           |   |        | 2,502   |  
|                       | Purchase accounting differences in basis of sales returns
    allowances acquired |                   |        | 40      |           |   |        | 40      |  
|                       |                                                                                   |                   |        |         |           |  
|                       |                                                                                   |                   | 40,810 |         |           |   | 40,642 |        
|                       |                                                                                   |                   |        |         |           |  
|                       | Net deferred tax asset before valuation allowance                                 |                   |        | 40,810  |           |   |        | 40,642  |  
|                       | Valuation allowance                                                               |                   |        | (40,810 | )         |   |        | (40,642 | )
|                       |                                                                                   |                   |        |         |           |  
|Net deferred tax asset |                                                                                   | $                 | 0      |         |           | $ | 0      |        
|                       |                                                                                   |                   |        |         |           |  





|                                                         |  |                |       |    |                |  |       |                |  |  |       |   
|-------------------------------------------------------- |  | -------------- | ----- | -- | -------------- |  | ----- | -------------- |  |  | ----- | --
|                                                         |  | Year Ended     |       |    | Year Ended     |  |       | Year Ended     | 
|                                                         |  | March 26, 2005 |       |    | March 27, 2004 |  |       | March 29, 2003 | 
|                                                         |  |                |       |    |                |  |       |                | 
|                                                         |  | Rate           |       |    | Rate           |  |       | Rate           | 
|                                                         |  |                |       |    |                |  |       |                | 
|Statutory rate                                           |  |                | 34.0  | %  |                |  | 34.0  | %              |  |  | 34.0  | % 
|Increase in valuation allowance                          |  |                | (24.6 | )% |                |  | (80.6 | )%             |  |  | (35.4 | )%
|State income taxes, net of Federal tax benefit           |  |                | (17.9 | )% |                |  | 0.0   | %              |  |  | 2.7   | % 
|Sec. 382 Federal and state NOL adjustment                |  |                | 0.0   | %  |                |  | 52.6  | %              |  |  | 0.0   | % 
|Nondeductible compensation expense on private stock sale |  |                | 6.7   | %  |                |  | 0.0   | %              |  |  | 0.0   | % 
|Foreign operations                                       |  |                | 1.5   | %  |                |  | 0.0   | %              |  |  | (1.8  | )%
|Other                                                    |  |                | 0.3   | %  |                |  | (6.0  | )%             |  |  | 2.6   | % 
|                                                         |  |                |       |    |                |  |       |                | 
|                                                         |  |                | 0.0   | %  |                |  | 0.0   | %              |  |  | 2.1   | % 
|                                                         |  |                |       |    |                |  |       |                | 



F-49



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |                            
|-- | ---------------------------
|L. | RELATED PARTY TRANSACTIONS:



Application of Issue No. 98-5
to Certain Convertible Instruments










F-50



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




















F-51



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)














F-52



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)














F-53



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)










|   |                               
|-- | ------------------------------
|M. | COMMITMENTS AND CONTINGENCIES:



Operating Leases.


|            |  |              |        | 
|----------- |  | ------------ | ------ | 
|            |  | Amounts      |       
|Fiscal Year |  | In Thousands |       
|            |  |              |       
|2005        |  | $            | 7,102  | 
|2006        |  |              | 6,141  | 
|2007        |  |              | 5,523  | 
|2008        |  |              | 5,484  | 
|2009        |  |              | 4,332  | 
|Thereafter  |  |              | 13,135 | 
|            |  |              |       
|            |  | $            | 41,717 | 
|            |  |              |       



Employment Agreements.


F-54



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)






|   |                   
|-- | ------------------
|N. | LEGAL PROCEEDINGS:





|   |                         
|-- | ------------------------
|O. | INCOME (LOSS) PER SHARE:



|                                                                                                                       |                         |                   |      |            |                |   |        |                |   |   |         |            |  
|---------------------------------------------------------------------------------------------------------------------- | ----------------------- | ----------------- | ---- | ---------- | -------------- | - | ------ | -------------- | - | - | ------- | ---------- | -
|                                                                                                                       |                         | Fiscal Year       |      |            | Fiscal Year    |   |        | Fiscal Year    |  
|                                                                                                                       |                         | Ended             |      |            | Ended          |   |        | Ended          |  
|                                                                                                                       |                         | March 26, 2005    |      |            | March 27, 2004 |   |        | March 29, 2003 |  
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|                                                                                                                       |                         | (In thousands)    |     
|                                                                                                                       |                         | except share data |     
|Income (loss) from continuing operations attributable to common
    stockholders                                       |                         | $                 | 571  |            |                | $ | (7,824 | )              |   | $ | (33,685 | )         
|Loss from discontinued operations                                                                                      |                         |                   |     |            |                |   |       |                |   |   | (1,604  | )         
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|Basic net income (loss) attributable to common stockholders                                                            |                         |                   | 571  |            |                |   | (7,824 | )              |   |   | (35,289 | )         
|Plus: cumulative preferred stock dividends                                                                             |                         |                   | 100  |            |                |   |       |                |   |   |        |           
|Plus: value of the increase in the Series A Preferred
    conversion ratio and the additional warrants issued to Birks |                         |                   | 17   |            |                |   |       |                |   |   |        |           
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|Diluted income (loss) from continuing operations                                                                       |                         | $                 | 688  |            |                | $ | (7,824 | )              |   | $ | (35,289 | )         
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|Weighted average shares outstanding                                                                                    |                         |                   |      |            |                |   |        |                |   |   |         |           
|                                                                                                                       | Basic                   |                   |      | 36,968,296 |                |   |        | 26,377,886     |   |   |         | 19,568,006 |  
|                                                                                                                       | Diluted                 |                   |      | 93,177,445 |                |   |        | 26,377,886     |   |   |         | 19,568,006 |  
|Basic earnings (loss) per share:                                                                                       |                         |                   |      |            |                |   |        |                |   |   |         |           
|                                                                                                                       | Continuing operations   |                   | $    | 0.02       |                |   | $      | (0.35          | ) |   | $       | (1.72      | )
|                                                                                                                       | Discontinued operations |                   |      | 0.00       |                |   |        | (0.00          | ) |   |         | 0.08       |  
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|                                                                                                                       |                         | $                 | 0.02 |            |                | $ | (0.35  | )              |   | $ | (1.80   | )         
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|Diluted earnings (loss) per share:                                                                                     |                         |                   |      |            |                |   |        |                |   |   |         |           
|                                                                                                                       | Continuing operations   |                   | $    | 0.01       |                |   | $      | (0.35          | ) |   | $       | (1.72      | )
|                                                                                                                       | Discontinued operations |                   |      | 0.00       |                |   |        | (0.00          | ) |   |         | 0.08       |  
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  
|                                                                                                                       |                         | $                 | 0.01 |            |                | $ | (0.35  | )              |   | $ | (1.80   | )         
|                                                                                                                       |                         |                   |      |            |                |   |        |                |  

F-55



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                        
|-- | -----------------------
|P. | EMPLOYEE BENEFIT PLANS:



| |                             
| | ----------------------------
| | Employee Stock Purchase Plan







| |                     
| | --------------------
| | Profit Sharing Plans





| |                   
| | ------------------
| | Stock Option Plans







|                                 |  |             |            |          |             |   |      |             |          |  |           |   |  |          |      |  |       |  |            |   |  |   |      | 
|-------------------------------- |  | ----------- | ---------- | -------- | ----------- | - | ---- | ----------- | -------- |  | --------- | - |  | -------- | ---- |  | ----- |  | ---------- | - |  | - | ---- | 
|                                 |  | Fiscal 2004 |            |          | Fiscal 2003 |   |      | Fiscal 2002 |         
|                                 |  |             |            |          |             |   |      |             |         
|                                 |  |             |            | Weighted |             |   |      |             | Weighted |  |           |   |  | Weighted |     
|                                 |  |             |            | Average  |             |   |      |             | Average  |  |           |   |  | Average  |     
|                                 |  |             |            | Exercise |             |   |      |             | Exercise |  |           |   |  | Exercise |     
|                                 |  | Shares      |            |          | Price       |   |      | Shares      |          |  | Price     |   |  | Shares   |      |  | Price | 
|                                 |  |             |            |          |             |   |      |             |          |  |           |   |  |          |      |  |       | 
|Outstanding at beginning of year |  |             | 6,031,797  |          |             | $ | 2.02 |             |          |  | 6,358,470 |   |  | $        | 2.33 |  |       |  | 6,561,220  |   |  | $ | 3.47 | 
|Granted                          |  |             | 80,000     |          |             |   | 0.62 |             |          |  | 170,000   |   |  |          | 0.70 |  |       |  | 2,650,000  |   |  |   | 0.28 | 
|Canceled/ Expired                |  |             | (1,425,834 | )        |             |   | 4.21 |             |          |  | (496,673  | ) |  |          | 5.53 |  |       |  | (2,852,750 | ) |  |   | 2.73 | 
|Exercised                        |  |             |           |          |             |   |     |             |          |  |          |   |  |          |     |  |       |  |           |   |  |   |     | 
|                                 |  |             |            |          |             |   |      |             |          |  |           |   |  |          |      |  |       | 
|Outstanding at end of year       |  |             | 4,685,963  |          |             | $ | 1.33 |             |          |  | 6,031,797 |   |  | $        | 2.02 |  |       |  | 6,358,470  |   |  | $ | 2.33 | 
|                                 |  |             |            |          |             |   |      |             |          |  |           |   |  |          |      |  |       | 

F-56



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|                         |  |             |           |                     |                  |  |                     |          |  |   |             |          |  |          |           |  |  |   |       | 
|------------------------ |  | ----------- | --------- | ------------------- | ---------------- |  | ------------------- | -------- |  | - | ----------- | -------- |  | -------- | --------- |  |  | - | ----- | 
|                         |  |             |           | Options Outstanding |                  |  | Options Exercisable |         
|                         |  |             |           |                     |                  |  |                     |         
|                         |  |             |           | Weighted            |                  |  |                     |          | 
|                         |  |             |           | Average             |                  |  | Weighted            |          |  |   |             | Weighted | 
|                         |  |             |           | Remaining           |                  |  | Average             |          |  |   |             | Average  | 
|                         |  | Number      |           |                     | Contractual Life |  |                     | Exercise |  |   | Number      |          |  | Exercise |          
|Range of Exercise Prices |  | Outstanding |           |                     | (In Years)       |  |                     | Price    |  |   | Exercisable |          |  | Price    |          
|                         |  |             |           |                     |                  |  |                     |          |  |   |             |          |  |          |          
|$0.23 - $ 0.34           |  |             | 2,645,000 |                     |                  |  | 7.5                 | *        |  | $ | 0.28        |          |  |          | 2,330,001 |  |  | $ | 0.28  | 
|$0.35 - $ 0.52           |  |             | 45,000    |                     |                  |  | 8.3                 |          |  | $ | 0.42        |          |  |          | 43,333    |  |  | $ | 0.42  | 
|$0.53 - $ 0.79           |  |             | 210,000   |                     |                  |  | 9.1                 |          |  | $ | 0.72        |          |  |          | 96,667    |  |  | $ | 0.78  | 
|$0.80 - $ 1.20           |  |             | 263,333   |                     |                  |  | 6.8                 |          |  | $ | 0.94        |          |  |          | 263,333   |  |  | $ | 0.94  | 
|$1.21 - $ 1.81           |  |             | 162,500   |                     |                  |  | 5.8                 |          |  | $ | 1.53        |          |  |          | 162,500   |  |  | $ | 1.53  | 
|$1.82 - $ 2.73           |  |             | 705,629   |                     |                  |  | 3.4                 |          |  | $ | 2.41        |          |  |          | 705,629   |  |  | $ | 2.41  | 
|$2.74 - $ 4.11           |  |             | 474,833   |                     |                  |  | 5.4                 |          |  | $ | 3.65        |          |  |          | 474,833   |  |  | $ | 3.65  | 
|$4.12 - $ 6.18           |  |             | 98,002    |                     |                  |  | 3.5                 |          |  | $ | 4.68        |          |  |          | 98,002    |  |  | $ | 4.68  | 
|$6.19 - $ 9.28           |  |             | 20,000    |                     |                  |  | 0.3                 |          |  | $ | 6.44        |          |  |          | 20,000    |  |  | $ | 6.44  | 
|$9.29 - $13.94           |  |             | 61,666    |                     |                  |  | 7.2                 |          |  | $ | 12.99       |          |  |          | 61,666    |  |  | $ | 12.99 | 
|                         |  |             |           |                     |                  |  |                     |          |  |   |             |          |  |          |          
|$0.23 - $13.94           |  |             | 4,685,963 |                     |                  |  | 6.5                 |          |  | $ | 1.33        |          |  |          | 4,255,964 |  |  | $ | 1.42  | 






|  |                                                                                                                                                                                                                                        
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|* | 1,500,000 of these options were granted to the Chief Executive
    Officer and expire either after ten years or two years after
    termination of employment. For purposes of the information
    herein, a term of ten years is used.



|   |                                     
|-- | ------------------------------------
|Q. | FAIR VALUE OF FINANCIAL INSTRUMENTS:

Disclosures
About Fair Value of Financial Instruments.








| |   |                                                                                                                                                                                 
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | The carrying amount of cash and cash equivalents, accounts
    receivable, accounts payable, and accrued expenses approximate
    fair value because of their short-term nature.
|
| |  | The fair value of the Companys long-term debt approximates
    carrying value based on the quoted market prices for the same or
    similar issues.                            

F-57



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES


NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS  (Continued)




|   |                                               
|-- | ----------------------------------------------
|R. | SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED):

|                                                                        |  |                                       |        |   |          |   |        |          |  |   |          |  |  |   |        |  
|----------------------------------------------------------------------- |  | ------------------------------------- | ------ | - | -------- | - | ------ | -------- |  | - | -------- |  |  | - | ------ | -
|                                                                        |  | Thirteen Weeks Ended                  |       
|                                                                        |  |                                       |       
|                                                                        |  | June 26,                              |        |   | Sep. 25, |   |        | Dec. 25, |  |   | Mar. 26, | 
|                                                                        |  | 2004                                  |        |   | 2004     |   |        | 2004     |  |   | 2005     | 
|                                                                        |  |                                       |        |   |          |   |        |          |  |   |          | 
|                                                                        |  | (In thousands, except per share data) |       
|Net Sales                                                               |  | $                                     | 29,138 |   |          | $ | 25,483 |          |  | $ | 57,237   |  |  | $ | 30,851 |  
|Gross Profit                                                            |  |                                       | 12,153 |   |          |   | 10,602 |          |  |   | 24,859   |  |  |   | 13,381 |  
|Net (loss) income from continuing operations                            |  |                                       | (2,472 | ) |          |   | (2,226 | )        |  |   | 6,243    |  |  |   | (857   | )
|Basic (loss) earnings per common share from continuing operations       |  |                                       | (0.07  | ) |          |   | (0.06  | )        |  |   | 0.17     |  |  |   | (0.02  | )
|Diluted (loss) earnings per common share from continuing
    operations |  |                                       | (0.07  | ) |          |   | (0.06  | )        |  |   | 0.07     |  |  |   | (0.02  | )

|                                                                        |  |                                       |        |   |          |   |        |          |  |   |          |  |  |   |        |  
|----------------------------------------------------------------------- |  | ------------------------------------- | ------ | - | -------- | - | ------ | -------- |  | - | -------- |  |  | - | ------ | -
|                                                                        |  | Thirteen Weeks Ended                  |       
|                                                                        |  |                                       |       
|                                                                        |  | June 28,                              |        |   | Sep. 27, |   |        | Dec. 27, |  |   | Mar. 27, | 
|                                                                        |  | 2003                                  |        |   | 2003     |   |        | 2003     |  |   | 2004     | 
|                                                                        |  |                                       |        |   |          |   |        |          |  |   |          | 
|                                                                        |  | (In thousands, except per share data) |       
|Net Sales                                                               |  | $                                     | 24,505 |   |          | $ | 23,834 |          |  | $ | 50,318   |  |  | $ | 26,860 |  
|Gross Profit                                                            |  |                                       | 9,904  |   |          |   | 9,501  |          |  |   | 21,248   |  |  |   | 11,407 |  
|Net (loss) income from continuing operations                            |  |                                       | (3,789 | ) |          |   | (5,175 | )        |  |   | 4,065    |  |  |   | (2,925 | )
|Basic (loss) earnings per common share from continuing operations       |  |                                       | (0.21  | ) |          |   | (0.28  | )        |  |   | 0.13     |  |  |   | (0.09  | )
|Diluted (loss) earnings per common share from continuing
    operations |  |                                       | (0.21  | ) |          |   | (0.28  | )        |  |   | 0.04     |  |  |   | (0.09  | )

F-58



---



##### Table of Contents



SCHEDULE II


MAYORS JEWELERS, INC. VALUATION AND QUALIFYING
ACCOUNTS


|                                 |                                 |                              |   |            |          |  |   |            |     |        |         |       |  |  |   |       | 
|-------------------------------- | ------------------------------- | ---------------------------- | - | ---------- | -------- |  | - | ---------- | --- | ------ | ------- | ----- |  |  | - | ----- | 
|                                 |                                 |                              |   | Charged to |          |  |   |            |    
|                                 |                                 | Beginning                    |   |            | Cost and |  |   |            |     | Ending |        
|Description                      |                                 | Balance                      |   |            | Expenses |  |   | Deductions |     |        | Balance |      
|                                 |                                 |                              |   |            |          |  |   |            |     |        |         |      
|                                 |                                 | (Amounts shown in thousands) |  
|Fiscal year ended March 29, 2003 |                                 |                              |   |            |          |  |   |            |     |        |         |       |  |  |   |      
|                                 | Allowance for Doubtful Accounts |                              | $ | 1,487      |          |  | $ | 2,366      | (1) |        | $       | 2,590 |  |  | $ | 1,263 | 
|                                 | Allowance for Restructuring     |                              |   | 8,574      |          |  |   |           |     |        |         | 8,574 |  |  |   |      | 
|                                 | Allowance for Sales Returns     |                              |   | 350        |          |  |   | 5,125      |     |        |         | 5,125 |  |  |   | 350   | 
|Fiscal year ended March 27, 2004 |                                 |                              |   |            |          |  |   |            |     |        |         |       |  |  |   |      
|                                 | Allowance for Doubtful Accounts |                              |   | 1,263      |          |  |   | 193        |     |        |         | 457   |  |  |   | 999   | 
|                                 | Allowance for Sales Returns     |                              |   | 350        |          |  |   | 6,706      |     |        |         | 6,844 |  |  |   | 212   | 
|Fiscal year ended March 26, 2005 |                                 |                              |   |            |          |  |   |            |     |        |         |       |  |  |   |      
|                                 | Allowance for Doubtful Accounts |                              |   | 999        |          |  |   | 148        |     |        |         | 185   |  |  |   | 962   | 
|                                 | Allowance for Sales Returns     |                              |   | 212        |          |  |   | 8,326      |     |        |         | 8,370 |  |  |   | 168   | 






|    |                  
|--- | -----------------
|(1) | Net of recoveries

F-59



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES








CONSOLIDATED CONDENSED BALANCE SHEETS 
UNAUDITED





|                                                                                                                                                                                            |                                            |                        |          |         |           |   |          |         | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------ | ---------------------- | -------- | ------- | --------- | - | -------- | ------- | 
|                                                                                                                                                                                            |                                            | June 25,               |          |         | March 26, |  
|                                                                                                                                                                                            |                                            | 2005                   |          |         | 2005      |  
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            |                                            | (Amounts shown in      |         
|                                                                                                                                                                                            |                                            | thousands except share |         
|                                                                                                                                                                                            |                                            | and per share data)    |         
|ASSETS                                                                                                                                                                                     
|Current Assets:                                                                                                                                                                             |                                            |                        |          |         |           |   |          |        
|Cash and cash equivalents                                                                                                                                                                   |                                            | $                      | 1,436    |         |           | $ | 1,220    |        
|Accounts receivable (net of allowance for doubtful accounts of
    $878 and $962, at June 25, 2005 and March 26, 2005,
    respectively)                                                    |                                            |                        | 5,587    |         |           |   | 6,936    |        
|Inventories                                                                                                                                                                                 |                                            |                        | 84,120   |         |           |   | 80,439   |        
|Other current assets                                                                                                                                                                        |                                            |                        | 596      |         |           |   | 632      |        
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total current assets                       |                        |          | 91,739  |           |   |          | 89,227  | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|Property, net                                                                                                                                                                               |                                            |                        | 12,813   |         |           |   | 13,143   |        
|Other assets                                                                                                                                                                                |                                            |                        | 234      |         |           |   | 416      |        
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total non-current assets                   |                        |          | 13,047  |           |   |          | 13,559  | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total assets                               |                        | $        | 104,786 |           |   | $        | 102,786 | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                           
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                                                       
|Current Liabilities:                                                                                                                                                                        |                                            |                        |          |         |           |   |          |        
|Accounts payable                                                                                                                                                                            |                                            | $                      | 18,201   |         |           | $ | 13,139   |        
|Accrued expenses                                                                                                                                                                            |                                            |                        | 5,183    |         |           |   | 6,786    |        
|Credit facility                                                                                                                                                                             |                                            |                        | 34,151   |         |           |   | 33,501   |        
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total current liabilities                  |                        |          | 57,535  |           |   |          | 53,426  | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|Term loan                                                                                                                                                                                   |                                            |                        | 11,668   |         |           |   | 12,668   |        
|Other long term liabilities                                                                                                                                                                 |                                            |                        | 2,507    |         |           |   | 2,401    |        
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total long term liabilities                |                        |          | 14,175  |           |   |          | 15,069  | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|Stockholders Equity:                                                                                                                                                                       |                                            |                        |          |         |           |   |          |        
|Series A-1 convertible preferred stock, $.001 par
    value, 15,050 shares authorized, issued and outstanding at
    June 25, 2005 and March 26, 2005, liquidation value of
    $15,050,000 |                                            |                        |         |         |           |   |         |        
|Common stock, $.0001 par value, 50,000,000 shares
    authorized, 46,975,546 issued at June 25, 2005 and
    March 26, 2005                                                                 |                                            |                        | 5        |         |           |   | 5        |        
|Additional paid-in capital                                                                                                                                                                  |                                            |                        | 206,574  |         |           |   | 207,100  |        
|Accumulated deficit                                                                                                                                                                         |                                            |                        | (144,103 | )       |           |   | (143,414 | )      
|Less: 9,983,954 shares of treasury stock, at cost                                                                                                                                           |                                            |                        | (29,400  | )       |           |   | (29,400  | )      
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total stockholders equity                 |                        |          | 33,076  |           |   |          | 34,291  | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  
|                                                                                                                                                                                            | Total liabilities and stockholders equity |                        | $        | 104,786 |           |   | $        | 102,786 | 
|                                                                                                                                                                                            |                                            |                        |          |         |           |  



F-60



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES








CONSOLIDATED STATEMENTS OF OPERATIONS 
UNAUDITED





|                                                       |                          |                                  |            |        |                |   |            |        | 
|------------------------------------------------------ | ------------------------ | -------------------------------- | ---------- | ------ | -------------- | - | ---------- | ------ | 
|                                                       |                          | Thirteen Weeks                   |            |        | Thirteen Weeks |  
|                                                       |                          | Ended                            |            |        | Ended          |  
|                                                       |                          | June 25,                         |            |        | June 26,       |  
|                                                       |                          | 2005                             |            |        | 2004           |  
|                                                       |                          |                                  |            |        |                |  
|                                                       |                          | (Amounts shown in thousands      |           
|                                                       |                          | except share and per share data) |           
|Net sales                                              |                          | $                                | 32,543     |        |                | $ | 29,138     |       
|Cost of sales                                          |                          |                                  | 18,130     |        |                |   | 16,985     |       
|                                                       |                          |                                  |            |        |                |  
|Gross profit                                           |                          |                                  | 14,413     |        |                |   | 12,153     |       
|                                                       |                          |                                  |            |        |                |  
|Selling, general and administrative expenses           |                          |                                  | 13,306     |        |                |   | 12,680     |       
|Other charges (credit)                                 |                          |                                  | (79        | )      |                |   |           |       
|Depreciation and amortization                          |                          |                                  | 784        |        |                |   | 833        |       
|                                                       |                          |                                  |            |        |                |  
|                                                       | Total operating expenses |                                  |            | 14,011 |                |   |            | 13,513 | 
|                                                       |                          |                                  |            |        |                |  
|Operating income (loss)                                |                          |                                  | 402        |        |                |   | (1,360     | )     
|Interest and other income                              |                          |                                  |           |        |                |   | 3          |       
|Interest and other financial costs                     |                          |                                  | (1,091     | )      |                |   | (1,115     | )     
|                                                       |                          |                                  |            |        |                |  
|Loss before income taxes                               |                          |                                  | (689       | )      |                |   | (2,472     | )     
|Income tax expense                                     |                          |                                  |           |        |                |   |           |       
|                                                       |                          |                                  |            |        |                |  
|Net loss                                               |                          |                                  | (689       | )      |                |   | (2,472     | )     
|Preferred stock cumulative dividend                    |                          |                                  | (301       | )      |                |   |           |       
|                                                       |                          |                                  |            |        |                |  
|Net loss attributable to common stockholders           |                          | $                                | (990       | )      |                | $ | (2,472     | )     
|                                                       |                          |                                  |            |        |                |  
|Weighted average shares outstanding, basic and diluted |                          |                                  | 36,991,592 |        |                |   | 36,961,307 |       
|Net loss per share, basic and diluted                  |                          | $                                | (0.03      | )      |                | $ | (0.07      | )     
|                                                       |                          |                                  |            |        |                |  



F-61



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





CONSOLIDATED STATEMENTS OF CASH FLOWS 
UNAUDITED





|                                                                                   |                                                            |                                                  |       |         |                |   |        |         |        |  
|---------------------------------------------------------------------------------- | ---------------------------------------------------------- | ------------------------------------------------ | ----- | ------- | -------------- | - | ------ | ------- | ------ | -
|                                                                                   |                                                            | Thirteen Weeks                                   |       |         | Thirteen Weeks |  
|                                                                                   |                                                            | Ended                                            |       |         | Ended          |  
|                                                                                   |                                                            | June 25,                                         |       |         | June 26,       |  
|                                                                                   |                                                            | 2005                                             |       |         | 2004           |  
|                                                                                   |                                                            |                                                  |       |         |                |  
|                                                                                   |                                                            | (Amounts shown in thousands)                     |      
|Cash flows from operating activities:                                              |                                                            |                                                  |       |         |                |   |        |        
|Net loss                                                                           |                                                            | $                                                | (689  | )       |                | $ | (2,472 | )      
|Adjustments to reconcile net loss to net cash used in by
    operating activities: |                                                            |                                                  |       |         |                |   |        |        
|                                                                                   | Depreciation and amortization                              |                                                  |       | 784     |                |   |        | 833     |       
|                                                                                   | Amortization of debt issuance costs                        |                                                  |       | 131     |                |   |        | 125     |       
|                                                                                   | (Recovery) provision for doubtful accounts                 |                                                  |       | (3      | )              |   |        | 106     |       
|                                                                                   | Non-cash compensation (credit) expense related to warrants |                                                  |       | (226    | )              |   |        | 296     |       
|                                                                                   | Gain on sale of fixed assets                               |                                                  |       |        |                |   |        | (18     | )     
|                                                                                   | (Increase) decrease in assets:                             |                                                  |       |         |                |   |        |         |       
|                                                                                   |                                                            | Accounts receivable                              |       |         | 1,353          |   |        |         | 1,483  |  
|                                                                                   |                                                            | Inventories                                      |       |         | (3,681         | ) |        |         | 1,757  |  
|                                                                                   |                                                            | Other assets                                     |       |         | 87             |   |        |         | 574    |  
|Increase (decrease) in liabilities:                                                |                                                            |                                                  |       |         |                |   |        |        
|                                                                                   |                                                            | Accounts payable                                 |       |         | 5,062          |   |        |         | (3,156 | )
|                                                                                   |                                                            | Accrued expenses and other long term liabilities |       |         | (1,497         | ) |        |         | (1,974 | )
|                                                                                   |                                                            |                                                  |       |         |                |  
|Net cash provided by (used in) operating activities                                |                                                            |                                                  | 1,321 |         |                |   | (2,446 | )      
|                                                                                   |                                                            |                                                  |       |         |                |  
|Cash flows from investing activities:                                              |                                                            |                                                  |       |         |                |   |        |        
|                                                                                   | Capital expenditures, net                                  |                                                  |       | (454    | )              |   |        | (347    | )     
|                                                                                   | Proceeds from sales of fixed assets                        |                                                  |       |        |                |   |        | 18      |       
|                                                                                   |                                                            |                                                  |       |         |                |  
|Net cash used in investing activities                                              |                                                            |                                                  | (454  | )       |                |   | (329   | )      
|                                                                                   |                                                            |                                                  |       |         |                |  
|Cash flows from financing activities:                                              |                                                            |                                                  |       |         |                |   |        |        
|                                                                                   | Borrowings under line of credit                            |                                                  |       | 34,338  |                |   |        | 32,749  |       
|                                                                                   | Line of credit repayments                                  |                                                  |       | (33,688 | )              |   |        | (30,316 | )     
|                                                                                   | Principal payment on term loan                             |                                                  |       | (1,000  | )              |   |        |        |       
|                                                                                   | Dividend payment                                           |                                                  |       | (151    | )              |   |        |        |       
|                                                                                   | Buyback of warrants                                        |                                                  |       | (150    | )              |   |        |        |       
|                                                                                   |                                                            |                                                  |       |         |                |  
|Net cash (used in) provided by financing activities                                |                                                            |                                                  | (651  | )       |                |   | 2,433  |        
|                                                                                   |                                                            |                                                  |       |         |                |  
|Net increase (decrease) in cash and cash equivalents                               |                                                            |                                                  | 216   |         |                |   | (342   | )      
|Cash and cash equivalents at beginning of period                                   |                                                            |                                                  | 1,220 |         |                |   | 1,233  |        
|                                                                                   |                                                            |                                                  |       |         |                |  
|Cash and cash equivalents at end of period                                         |                                                            | $                                                | 1,436 |         |                | $ | 891    |        
|                                                                                   |                                                            |                                                  |       |         |                |  
|Supplemental cash flow information:                                                |                                                            |                                                  |       |         |                |   |        |        
|                                                                                   | Interest paid                                              |                                                  | $     | 934     |                |   | $      | 1,115   |       
|                                                                                   |                                                            |                                                  |       |         |                |  
|Non-cash investing and financing activities:                                       |                                                            |                                                  |       |         |                |   |        |        
|                                                                                   | Property acquired with debt                                |                                                  | $     | 329     |                |   | $      | 231     |       
|                                                                                   |                                                            |                                                  |       |         |                |  






F-62



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


(Unaudited)




|   |                   
|-- | ------------------
|A. | Nature of Business









|   |                                  
|-- | ---------------------------------
|B. | Newly Issued Accounting Standards







F-63



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)








|   |                                        
|-- | ---------------------------------------
|C. | Accounting for Stock-Based Compensation

Accounting for Stock Issued to
Employees, Accounting for
Stock-Based Compensation  Transition and
Disclosure Accounting for Stock-Based Compensation


|                                                                                                                  |                                |                       |        |       |                |   |        |       |  
|----------------------------------------------------------------------------------------------------------------- | ------------------------------ | --------------------- | ------ | ----- | -------------- | - | ------ | ----- | -
|                                                                                                                  |                                | Thirteen Weeks        |        |       | Thirteen Weeks |  
|                                                                                                                  |                                | Ended                 |        |       | Ended          |  
|                                                                                                                  |                                | June 25,              |        |       | June 26,       |  
|                                                                                                                  |                                | 2005                  |        |       | 2004           |  
|                                                                                                                  |                                |                       |        |       |                |  
|                                                                                                                  |                                | (In thousands, except |       
|                                                                                                                  |                                | per share amounts)    |       
|Net loss attributable to common stockholders as reported                                                          |                                | $                     | (990   | )     |                | $ | (2,472 | )    
|Adjust for non-cash compensation expense for warrants recorded
    pursuant to APB 25                             |                                |                       | (226   | )     |                |   | 161    |      
|                                                                                                                  |                                |                       |        |       |                |  
|Adjusted net loss                                                                                                 |                                |                       | (1,216 | )     |                |   | (2,311 | )    
|Stock-based employee compensation expense determined under
    fair-value-based method for all awards, net of tax |                                |                       | (26    | )     |                |   | (191   | )    
|                                                                                                                  |                                |                       |        |       |                |  
|Pro-forma net loss                                                                                                |                                | $                     | (1,242 | )     |                | $ | (2,502 | )    
|                                                                                                                  |                                |                       |        |       |                |  
|Loss per share                                                                                                    |                                |                       |        |       |                |   |        |      
|                                                                                                                  | As reported basic and diluted: |                       | $      | (0.03 | )              |   | $      | (0.07 | )
|                                                                                                                  |                                |                       |        |       |                |  
|                                                                                                                  | Pro-forma basic and diluted:   |                       | $      | (0.03 | )              |   | $      | (0.07 | )
|                                                                                                                  |                                |                       |        |       |                |  

F-64



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)






|   |                              
|-- | -----------------------------
|D. | Term Loan and Credit Facility







|   |            
|-- | -----------
|E. | Inventories



|               |  |                              |        |  |                |   |        | 
|-------------- |  | ---------------------------- | ------ |  | -------------- | - | ------ | 
|               |  | June 25, 2005                |        |  | March 26, 2005 |  
|               |  | Company                      |        |  | Company        |  
|               |  | Owned                        |        |  | Owned          |  
|               |  |                              |        |  |                |  
|               |  | (Amounts shown in thousands) |       
|Raw materials  |  | $                            | 881    |  |                | $ | 893    | 
|Finished goods |  |                              | 83,239 |  |                |   | 79,546 | 
|               |  |                              |        |  |                |  
|               |  | $                            | 84,120 |  |                | $ | 80,439 | 
|               |  |                              |        |  |                |  





|   |                           
|-- | --------------------------
|F. | Related Party Transactions



F-65



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)




Applications of Issue No. 98-5
to Certain Convertible Instruments






F-66



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)
















F-67



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)












F-68



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)














F-69



---



##### Table of Contents



MAYORS JEWELERS, INC. AND SUBSIDIARIES





NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL
STATEMENTS  (Continued)





(Unaudited)










|   |                  
|-- | -----------------
|G. | Legal Proceedings

1 2


F-70



---



##### Table of Contents






APPENDIX A


Agreement and Plan of Merger and Reorganization






---



##### Table of Contents





AGREEMENT AND PLAN OF MERGER AND REORGANIZATION


among


HENRY BIRKS & SONS INC.,


BIRKS MERGER CORPORATION


and


MAYORS JEWELERS, INC.


Dated as of


April 18, 2005






---



##### Table of Contents



TABLE OF CONTENTS


|                                                                       |  |                                              |  |      |    | 
|---------------------------------------------------------------------- |  | -------------------------------------------- |  | ---- | -- | 
|                                                                       |  |                                              |  | Page |   
|                                                                       |  |                                              |  |      |   
|ARTICLE I
    THE MERGER                                              
|SECTION1.01                                                            |  | The Merger                                   |  |      | 1  | 
|SECTION1.02                                                            |  | Effective Time; Closing                      |  |      | 1  | 
|SECTION1.03                                                            |  | Effect of the Merger                         |  |      | 2  | 
|SECTION1.04                                                            |  | Certificate of Incorporation; By-laws        |  |      | 2  | 
|SECTION1.05                                                            |  | Directors and Officers                       |  |      | 2  | 
|                                                                      
|ARTICLE II
    CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES     
|SECTION2.01                                                            |  | Conversion of Securities                     |  |      | 2  | 
|SECTION2.02                                                            |  | Exchange of Certificates                     |  |      | 3  | 
|SECTION2.03                                                            |  | Stock Transfer Books                         |  |      | 5  | 
|SECTION2.04                                                            |  | Company Stock Options                        |  |      | 5  | 
|SECTION2.05                                                            |  | Restricted Stock                             |  |      | 6  | 
|SECTION2.06                                                            |  | Company Warrants                             |  |      | 6  | 
|SECTION2.07                                                            |  | No Appraisal Rights                          |  |      | 7  | 
|SECTION2.08                                                            |  | Affiliates                                   |  |      | 7  | 
|                                                                      
|ARTICLE III
    REPRESENTATIONS AND WARRANTIES OF THE COMPANY         
|SECTION3.01                                                            |  | Authority Relative to this Agreement         |  |      | 7  | 
|SECTION3.02                                                            |  | No Conflict; Required Filings and Consents   |  |      | 7  | 
|SECTION3.03                                                            |  | Board Approval; Vote Required                |  |      | 8  | 
|SECTION3.04                                                            |  | [Reserved]                                   |  |      | 8  | 
|SECTION3.05                                                            |  | Opinion of Financial Advisor                 |  |      | 8  | 
|SECTION3.06                                                            |  | Brokers                                      |  |      | 8  | 
|                                                                      
|ARTICLE IV
    REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
|SECTION4.01                                                            |  | Corporate Organization                       |  |      | 9  | 
|SECTION4.02                                                            |  | Certificate of Amalgamation and By-laws      |  |      | 9  | 
|SECTION4.03                                                            |  | Capitalization                               |  |      | 9  | 
|SECTION4.04                                                            |  | Authority Relative to this Agreement         |  |      | 10 | 
|SECTION4.05                                                            |  | No Conflict; Required Filings and Consents   |  |      | 10 | 
|SECTION4.06                                                            |  | Permits; Compliance                          |  |      | 11 | 
|SECTION4.07                                                            |  | SEC Filings                                  |  |      | 11 | 
|SECTION4.08                                                            |  | Financial Statement; Undisclosed Liabilities |  |      | 11 | 
|SECTION4.09                                                            |  | Absence of Certain Changes or Events         |  |      | 12 | 
|SECTION4.10                                                            |  | Internal Controls                            |  |      | 12 | 
|SECTION4.11                                                            |  | Absence of Litigation                        |  |      | 12 | 
|SECTION4.12                                                            |  | Employee Benefit Plans                       |  |      | 12 | 
|SECTION4.13                                                            |  | Labor and Employment Matters                 |  |      | 13 | 
|SECTION4.14                                                            |  | Real Property; Title to Assets               |  |      | 13 | 
|SECTION4.15                                                            |  | Intellectual Property                        |  |      | 14 | 

i



---



##### Table of Contents



|                                                     |  |                                                        |  |      |    | 
|---------------------------------------------------- |  | ------------------------------------------------------ |  | ---- | -- | 
|                                                     |  |                                                        |  | Page |   
|                                                     |  |                                                        |  |      |   
|SECTION4.16                                          |  | Taxes                                                  |  |      | 15 | 
|SECTION4.17                                          |  | Environmental Matters                                  |  |      | 15 | 
|SECTION4.18                                          |  | Material Contracts                                     |  |      | 15 | 
|SECTION4.19                                          |  | Insurance                                              |  |      | 16 | 
|SECTION4.20                                          |  | Customers and Suppliers                                |  |      | 16 | 
|SECTION4.21                                          |  | Certain Business Practices                             |  |      | 16 | 
|SECTION4.22                                          |  | Interested Party Transactions                          |  |      | 17 | 
|SECTION4.23                                          |  | No Vote Required                                       |  |      | 17 | 
|SECTION4.24                                          |  | Accounts Receivable                                    |  |      | 17 | 
|SECTION4.25                                          |  | Inventories                                            |  |      | 17 | 
|SECTION4.26                                          |  | Operations of Merger Sub                               |  |      | 17 | 
|SECTION4.27                                          |  | Brokers                                                |  |      | 17 | 
|                                                    
|ARTICLE V
    CONDUCT OF BUSINESS PENDING THE MERGER
|SECTION5.01                                          |  | Conduct of Business by the Company Pending the Merger  |  |      | 18 | 
|SECTION5.02                                          |  | Conduct of Business by Parent Pending the Merger       |  |      | 18 | 
|                                                    
|ARTICLE VI
    ADDITIONAL AGREEMENTS                
|SECTION6.01                                          |  | Registration Statement; Proxy Statement                |  |      | 19 | 
|SECTION6.02                                          |  | Company Stockholders Meeting                          |  |      | 21 | 
|SECTION6.03                                          |  | Access to Information; Confidentiality                 |  |      | 21 | 
|SECTION6.04                                          |  | Directors and Officers Indemnification and Insurance |  |      | 21 | 
|SECTION6.05                                          |  | Notification of Certain Matters                        |  |      | 22 | 
|SECTION6.06                                          |  | Company Affiliates                                     |  |      | 22 | 
|SECTION6.07                                          |  | Further Action; Reasonable Efforts                     |  |      | 22 | 
|SECTION6.08                                          |  | Plan of Reorganization                                 |  |      | 22 | 
|SECTION6.09                                          |  | Obligations of Merger Sub                              |  |      | 23 | 
|SECTION6.10                                          |  | Consents of Accountants                                |  |      | 23 | 
|SECTION6.11                                          |  | AMEX Listing                                           |  |      | 23 | 
|SECTION6.12                                          |  | Public Announcements                                   |  |      | 23 | 
|SECTION6.13                                          |  | Board of Directors of Parent                           |  |      | 23 | 
|SECTION6.14                                          |  | Company Stock Held by Parent                           |  |      | 23 | 
|                                                    
|ARTICLE VII
    CONDITIONS TO THE MERGER            
|SECTION7.01                                          |  | Conditions to the Obligations of Each Party            |  |      | 23 | 
|SECTION7.02                                          |  | Conditions to the Obligations of Parent and Merger Sub |  |      | 24 | 
|SECTION7.03                                          |  | Conditions to the Obligations of the Company           |  |      | 24 | 

ii



---



##### Table of Contents



|                                                   |  |                                                            |  |      |    | 
|-------------------------------------------------- |  | ---------------------------------------------------------- |  | ---- | -- | 
|                                                   |  |                                                            |  | Page |   
|                                                   |  |                                                            |  |      |   
|                                                  
|ARTICLE VIII
    TERMINATION, AMENDMENT AND WAIVER
|SECTION8.01                                        |  | Termination                                                |  |      | 26 | 
|SECTION8.02                                        |  | Effect of Termination                                      |  |      | 27 | 
|SECTION8.03                                        |  | Fees and Expenses                                          |  |      | 27 | 
|SECTION8.04                                        |  | Amendment                                                  |  |      | 27 | 
|SECTION8.05                                        |  | Waiver                                                     |  |      | 27 | 
|                                                  
|ARTICLE IX
    GENERAL PROVISIONS                 
|SECTION9.01                                        |  | Non-Survival of Representations, Warranties and Agreements |  |      | 27 | 
|SECTION9.02                                        |  | Notices                                                    |  |      | 28 | 
|SECTION9.03                                        |  | Certain Definitions                                        |  |      | 29 | 
|SECTION9.04                                        |  | Severability                                               |  |      | 32 | 
|SECTION9.05                                        |  | Entire Agreement; Assignment                               |  |      | 32 | 
|SECTION9.06                                        |  | Parties in Interest                                        |  |      | 32 | 
|SECTION9.07                                        |  | Specific Performance                                       |  |      | 32 | 
|SECTION9.08                                        |  | Governing Law                                              |  |      | 33 | 
|SECTION9.09                                        |  | Waiver of Jury Trial                                       |  |      | 33 | 
|SECTION9.10                                        |  | Headings                                                   |  |      | 33 | 
|SECTION9.11                                        |  | Counterparts                                               |  |      | 33 | 
|SECTION9.12                                        |  | Special Committee                                          |  |      | 33 | 

iii



---



##### Table of Contents



Agreement Parent Merger Sub Company


DGCL Merger


Company Board Special Committee






Parent
Board


Code








Section The
Merger. Surviving Corporation


Section Effective
Time; Closing. Certificate of Merger






---



##### Table of Contents



Effective
Time Closing


Section Effect
of the Merger.


Section Certificate
of Incorporation; By-laws. provided however




Section Directors
and Officers.






Section Conversion
of Securities.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) each share of common stock, par value $0.0001 per
    share (Company Common Stock), of the Company
    issued and outstanding immediately prior to the Effective Time,
    excluding any shares of Company Common Stock (i) held
    directly by Parent and (ii) to be canceled pursuant to
    Section 2.01(b), being hereinafter collectively referred to
    as the Shares, shall be canceled and shall be
    converted automatically, subject to Section 2.02, into the
    right to receive 0.08695 (the Exchange Ratio)
    Class A Voting Shares (Parent Common
    Stock) of Parent (the Merger
    Consideration), payable upon surrender, in the manner
    provided in Section 2.02, of the certificate that formerly
    evidenced such Share;
|
| | (b) each share of Company Common Stock held in the treasury
    of the Company and each share of Company Common Stock held by
    any direct or indirect subsidiary of the Company immediately
    prior to the Effective Time shall be canceled without any
    conversion thereof and no payment or distribution shall be made
    with respect thereto; and                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | (c) each share of common stock, par value $0.01 per
    share, of Merger Sub issued and outstanding immediately prior to
    the Effective Time shall be canceled and shall be converted
    automatically into the right to receive one share of Company
    Common Stock, and no payment or distribution shall be made with
    respect thereto.                                                                                                                                                                                                                                                                                                                                                                                                                       

2



---



##### Table of Contents



Section Exchange
of Certificates. Exchange Agent. Exchange Agent Exchange
Fund


Exchange Procedures. Certificates


Distributions with Respect to Unexchanged Shares
of Parent Common Stock.


3



---



##### Table of Contents



No Further Rights in Shares.


No Fractional Shares. AMEX


Adjustments to Exchange Ratio.


Termination of Exchange Fund.


No Liability.


Withholding Rights. ITA


Lost Certificates.


4



---



##### Table of Contents





Section Stock
Transfer Books.


Section Company
Stock Options. Company Stock
Options Company Stock Option
Plans Substitute
Option




5



---



##### Table of Contents







Section Restricted
Stock. Company Restricted
Stock Award


Section Company
Warrants. Company Warrants Company Warrant
Agreements Substitute Warrant




6



---



##### Table of Contents





Section No
Appraisal Rights.


Section Affiliates.








Section Authority
Relative to this Agreement. Transactions


Section No
Conflict; Required Filings and Consents. Company Disclosure Schedule Law


7



---



##### Table of Contents





Governmental
Authority Exchange Act Blue Sky
Laws


Section Board
Approval; Vote Required.






Section [Reserved]


Section Opinion
of Financial Advisor. HLHZ Fairness Opinion


Section Brokers.


8



---



##### Table of Contents









Section Corporate
Organization. Subsidiary Subsidiaries


Parent Disclosure Schedule


Material Subsidiary


Section Certificate
of Amalgamation and By-laws.


Section Capitalization. Parent Class B Shares Parent
Class C Shares Parent Non-Voting
Shares Parent Preferred Stock Parent Stock Option
Plan


9



---



##### Table of Contents









Securities Act


Section Authority
Relative to this Agreement.


Section No
Conflict; Required Filings and Consents.


10



---



##### Table of Contents







Section Permits;
Compliance. Parent
Permits


Section SEC
Filings. SEC Parent SEC
Reports


Section Financial
Statement; Undisclosed Liabilities. Audited Financial Statements Unaudited Financial
Statements Financial Statements


11



---



##### Table of Contents







Section Absence
of Certain Changes or Events.


Section Internal
Controls. GAAP




Section Absence
of Litigation. Action


Section Employee
Benefit Plans.


12



---



##### Table of Contents



Plans








Section Labor
and Employment Matters.




Section Real
Property; Title to Assets.


13



---



##### Table of Contents



Liens Permitted Liens


Lease Documents






Section Intellectual
Property. Parent Owned Intellectual Property Parent Licensed Intellectual Property


14



---



##### Table of Contents





Section Taxes.


Section Environmental
Matters. Environmental Permits


Section Material
Contracts. Material Contracts




| |                                                                                                                                                                                                                                                                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) each material contract (as such term is
    defined in Item 601(b)(10) of Regulation S-K of the
    SEC) with respect to Parent and its Subsidiaries;                                                                                                                                                                                                                                                 
|
| | (ii) each contract and agreement which is likely to involve
    consideration of more than $2,500,000, in the aggregate, over
    the remaining term of such contract or agreement;                                                                                                                                                                                                                         
|
| | (iii) all material broker, distributor, supply, dealer,
    manufacturers representative, franchise, agency, sales
    promotion, market research, marketing consulting and advertising
    contracts and agreements to which Parent or any Subsidiary is a
    party;                                                                                                                                     
|
| | (iv) all management contracts (excluding contracts for
    employment) and contracts with other consultants, including any
    contracts involving the payment of royalties or other amounts
    calculated based upon the revenues or income of Parent or any
    Subsidiary or income or revenues related to any product of
    Parent or any Subsidiary to which Parent or any Subsidiary is a
    party;

15



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (v) all material contracts and agreements under which it
    has created, incurred, assumed, or guaranteed any material
    indebtedness or under which it has imposed a material Lien on
    any of its assets, tangible or intangible;                                                                                                                                                                                                                                                                                              
|
| | (vi) all material contracts and agreements with any
    Governmental Authority to which Parent or any Subsidiary is a
    party;                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (vii) all contracts and agreements that materially limit,
    or purport to materially limit, the ability of Parent or any
    Subsidiary to compete in any line of business or with any person
    or entity or in any geographic area or during any period of time;                                                                                                                                                                                                                                                                 
|
| | (viii) all other contracts and agreements, whether or not
    made in the ordinary course of business, which are material to
    Parent or the conduct of its business, or the absence of which
    would, individually or in the aggregate, prevent or materially
    delay consummation of any of the Transactions or otherwise
    prevent or materially delay Parent or Merger Sub from performing
    its obligations under this Agreement or would, individually or
    in the aggregate, have a Parent Material Adverse Effect;
|
| | (ix) any material agreement concerning a partnership or
    joint venture; and                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | (x) any agreement under which it has advanced or loaned any
    amount to any of its stockholders, affiliates, directors,
    officers, or employees other than in the ordinary course of
    business.                                                                                                                                                                                                                                                                                                                               



Section Insurance.


Section Customers
and Suppliers.


Section Certain
Business Practices.


16



---



##### Table of Contents





Section Interested
Party Transactions.


Section No
Vote Required.


Section Accounts
Receivable.


Section Inventories. Inventories




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Parent or a Subsidiary, as the case may be, has good
    and marketable title to the Inventories free and clear of all
    Liens other than Permitted Liens.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | (b) Parent has adequately provided for obsolescence and
    returns and the provision for obsolescence and returns is
    accurately reflected, in all material respects, in the Financial
    Statements.                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | (c) Neither Parent nor any Subsidiary has acquired or
    committed to acquire or manufacture Inventory for sale which is
    not of a quality and quantity usable in the ordinary course of
    business within a reasonable period of time and consistent with
    past practice. The Inventories are in good and merchantable
    condition in all material respects, are suitable and usable for
    the purposes for which they are intended and are in a condition
    such that they can be sold in the ordinary course of the
    business of Parent and its Subsidiaries consistent with past
    practice.

Section Operations
of Merger Sub.


Section Brokers.


17



---



##### Table of Contents







Section Conduct
of Business by the Company Pending the Merger.


Section Conduct
of Business by Parent Pending the Merger.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) conduct the businesses of Parent and the Subsidiaries
    in a manner, or take any action with respect to the businesses
    of Parent and the Subsidiaries, that is not in the ordinary
    course of business and consistent with past practice or that
    would cause Parent to be in default of the Amended and Restated
    Accounts Receivable Management, Loan and Security Agreement
    between GMAC Commercial Finance Corporation  Canada
    and Parent (as in effect on the date hereof, irrespective of any
    subsequent waiver or amendment);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (b) change nor amend the charter documents or By-laws of
    Parent;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (c) issue, sell, or grant any shares of capital stock
    (except Parent Common Stock issued upon exercise of options
    outstanding on the date of the Agreement), or any options,
    warrants, or rights to purchase or subscribe to, or enter into
    any arrangement or contract with respect to the issuance or sale
    of, any of the capital stock of Parent or any Subsidiary or
    rights or obligations convertible into or exchangeable for any
    such shares of capital stock;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (d) split, combine or reclassify any of its capital stock
    or otherwise make any changes in the capital structure of Parent;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | (e) declare, pay, or set aside for payment any dividend or
    other distribution in respect of the capital stock or other
    equity securities of Parent or any Subsidiary or redeem,
    purchase, or otherwise acquire any shares of the capital stock
    or other securities of Parent or any Subsidiary or rights or
    obligations convertible into or exchangeable for any shares of
    the capital stock or other securities of Parent or any
    Subsidiary or obligations convertible into such, or any options,
    warrants, or other rights to purchase or subscribe to any of the
    foregoing;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| | (f) (i) except for normal increases made in the
    ordinary course of business consistent with past practice, or as
    required by applicable Law or an agreement in existence as of
    the date of this Agreement, increase the wages, salaries,
    compensation, pension, or other fringe benefits or perquisites
    payable to any officer, employee, or director of Parent or any
    Subsidiary or pay any benefit not contemplated by any Plan as in
    effect on the date hereof, (ii) pay any pension or
    retirement allowance not required by any existing Plan or by
    applicable Law, (iii) except for bonuses paid in the
    ordinary course of business consistent with past practice, or as
    required by an agreement in existence as of the date of this
    Agreement, pay any bonus, (iv) except for agreements
    entered or amended in the ordinary course of business consistent
    with past practice, become a party to, amend or commit itself
    to, any pension, retirement, profit-sharing or welfare benefit
    plan or agreement or employment, consulting, indemnification,
    severance or termination agreement with or for the benefit of
    any employee, other than as required by applicable law or an
    existing agreement set forth in Section 4.12(a) of the
    Parent Disclosure Schedule, or (v) except as required under
    any existing Plan, grant, or agreement, accelerate the vesting
    of, or the lapsing of restrictions with respect to, any stock
    options granted pursuant to any Parent Stock Option Plan or any
    other Parent stock-based awards;

18



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (g) sell, license, lease, encumber, assign or otherwise
    dispose of, abandon or fail to maintain any of its material
    assets, properties (including Intellectual Property) or other
    rights or agreements other than in the ordinary course of
    business consistent with past practice;                                                                                                                                                                                                                                                                                                                                        
|
| | (h) enter into any new line of business;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (i) acquire or agree to acquire, by merging or
    consolidating with, or by purchasing a substantial equity
    interest in or a substantial portion of the assets of, or by any
    other manner, any business or any corporation, partnership,
    association or other business organization or division thereof;                                                                                                                                                                                                                                                                                                                      
|
| | (j) create, renew, amend or terminate, fail to perform any
    material obligations under, waive or release any material rights
    under or give notice of a proposed renewal, amendment, waiver,
    release or termination of, any material contract, agreement or
    lease for goods, services or office space to which Parent or any
    of the Subsidiaries is a party or by which Parent or any of the
    Subsidiaries or their respective properties is bound, other than
    any of the foregoing arising in the ordinary course of business
    (and as to which Parent shall provide prior notice thereof to
    the Company);
|
| | (k) (i) cause any material insurance policy naming it
    as a beneficiary or a loss payable payee to be canceled or
    terminated, or (ii) cause Parents directors and
    officers liability insurance policy, and any excess liability
    policy related thereto, to be canceled, terminated or otherwise
    not be renewed or replaced with at least an equivalent amount of
    coverage and on other terms no less favorable to Parent and its
    officers and directors;                                                                                                                                                       
|
| | (l) adopt a plan of complete or partial liquidation,
    dissolution, merger, consolidation, restructuring,
    recapitalization or other reorganization of Parent or any of its
    Subsidiaries;                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| | (m) make any material election relating to Taxes or change
    any Tax accounting method, or settle any material liability
    relating to Taxes (other than in the ordinary course of
    business);                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (n) engage in any action that could reasonably be expected
    to cause the Merger (i) to fail to qualify as a
    reorganization under Section 368(a) of the Code
    or (ii) to result in the application of
    Section 367(a)(1) of the Code to any person other than a
    five-percent transferee shareholder;                                                                                                                                                                                                                                                                                                                     
|
| | (o) take any action to cause Parents representations
    and warranties set forth in Article IV to be untrue in any
    material respect;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | (p) take any action that would reasonably be likely to
    materially delay the Merger; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | (q) agree to take, make any commitment to take, or adopt
    any resolutions of its board of directors in support of, any of
    the foregoing actions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    





Section Registration
Statement; Proxy Statement. Company Stockholders
Meeting Proxy
Statement Registration
Statement


19



---



##### Table of Contents





Company Recommendation








20



---



##### Table of Contents





Section Company
Stockholders Meeting.


Section Access
to Information; Confidentiality. Representatives


Confidentiality Agreement




Section Directors
and Officers Indemnification and Insurance.


provided however






21



---



##### Table of Contents





Section Notification
of Certain Matters. provided however


Section Company
Affiliates. Company Affiliate


Section Further
Action; Reasonable Efforts. provided


Section Plan
of Reorganization.


22



---



##### Table of Contents



IRS




Section Obligations
of Merger Sub.


Section Consents
of Accountants.


Section AMEX
Listing.


Section Public
Announcements.


Section Board
of Directors of Parent.


Section Company
Stock Held by Parent.






Section Conditions
to the Obligations of Each Party.




| |                                                                                                                                                                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Registration Statement. The Registration
    Statement shall have been declared effective by the SEC under
    the Securities Act and no stop order suspending the
    effectiveness of the Registration Statement shall have been
    issued by the SEC and no proceeding for that purpose shall have
    been initiated by the SEC.
|
| | (b) Company Stockholder Approval. The Company
    shall have obtained the Disinterested Stockholder Vote at the
    Company Stockholders Meeting.                                                                                                                                                                                       

23



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (c) No Order. No Governmental Authority shall
    have enacted, issued, promulgated, enforced or entered any law,
    rule, regulation, judgment, decree, executive order or award (an
    Order) which is then in effect and has the
    effect of making the Merger illegal or otherwise prohibiting
    consummation of the Merger.
|
| | (d) AMEX Listing. The shares of Parent Common
    Stock shall have been authorized for listing on the AMEX,
    subject to official notice of issuance.                                                                                                                                                                                 
|
| | (e) HLHZ Opinion. The HLHZ Fairness Opinion
    shall not have been withdrawn, revoked, annulled or materially
    modified.                                                                                                                                                                                                            

Section Conditions
to the Obligations of Parent and Merger Sub.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Representations and Warranties. The
    representations and warranties of the Company contained in this
    Agreement shall be true and correct in all material respects as
    of the Effective Time, as though made on and as of the Effective
    Time, except to the extent expressly made as of an earlier date,
    in which case as of such earlier date (provided that any
    representation or warranty that is qualified by materiality or
    Company Material Adverse Effect shall be true and correct in all
    respects as of the Effective Time, or as of such particular
    earlier date, as the case may be); provided,
    however, this condition shall not apply to any
    representation or warranty of the Company that, to the knowledge
    of Parent, was not true and correct as of the date hereof; and
    provided, further, this condition shall not apply
    to any representation or warranty of the Company if the failure
    of such representation or warranty to be so true and correct is
    attributable to any action or inaction on the part of Parent or
    its affiliates or associates.
|
| | (b) Agreements and Covenants. The Company
    shall have performed or complied in all material respects with
    all agreements and covenants required by this Agreement to be
    performed or complied with by it on or prior to the Effective
    Time; provided, however, this condition shall not apply to any
    agreement or covenant of the Company if the failure by the
    Company to so perform or comply is attributable to any action or
    inaction on the part of Parent or its affiliates or associates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (c) Officer Certificate. The Company shall
    have delivered to Parent a certificate, dated the date of the
    Closing, signed by the Chief Administrative Officer of the
    Company, certifying as to the satisfaction of the conditions
    specified in Sections 7.02(a) and 7.02(b).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (d) Consents. All consents, approvals and
    authorizations legally required to be obtained to consummate the
    Merger shall have been obtained from and made with all
    Governmental Authorities, and all consents from the third
    parties listed in Section 7.02(d) of the Parent Disclosure
    Schedule shall have been obtained.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | (e) Material Adverse Effect. No Company
    Material Adverse Effect shall have occurred since the date of
    this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

Section Conditions
to the Obligations of the Company.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Representations and Warranties. The
    representations and warranties of Parent and Merger Sub
    contained in this Agreement shall be true and correct in all
    material respects as of the Effective Time, as though made on
    and as of the Effective Time, except to the extent expressly
    made as of an earlier date, in which case as of such earlier
    date (provided that any representation or warranty that
    is qualified by materiality or Parent Material Adverse Effect
    shall be true and correct in all respects as of the Effective
    Time, or as of such particular earlier date, as the case may be).

24



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b) Agreements and Covenants. Parent and
    Merger Sub shall have performed or complied in all material
    respects with all agreements and covenants required by this
    Agreement to be performed or complied with by it on or prior to
    the Effective Time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | (c) Officer Certificate. Parent shall have
    delivered to the Company a certificate, dated the date of the
    Closing, signed by the President or any Vice President of
    Parent, certifying as to the satisfaction of the conditions
    specified in Sections 7.03(a) and 7.03(b).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (d) Tax Opinion. The Company shall have
    received the opinion of Holland & Knight LLP, counsel
    to the Company, based upon customary representations of Parent,
    Merger Sub and the Company, and normal assumptions, to the
    effect that, for United States federal income tax purposes,
    (i) the Merger will qualify as a reorganization
    within the meaning of Section 368(a) of the Code and each
    of Parent and the Company will be a party to the
    reorganization within the meaning of section 368(b)
    of the Code, and (ii) the conversion of Company Common
    Shares into Parent Common Stock in the Merger will not result in
    the recognition of gain under Section 367 of the Code to
    any person who is not a five percent transferee shareholder,
    which opinion shall not have been withdrawn or modified in any
    material respect; provided, however, that if such
    counsel is unable or unwilling to deliver such opinion this
    condition shall be satisfied by delivery to the Company of a
    similar opinion of King & Spalding LLP. The issuance of
    such opinion shall be conditioned on receipt by Holland and
    Knight LLP or King & Spalding LLP, as the case may be,
    of representation letters from each of Parent and Company as
    contemplated in Section 6.08 of this Agreement. Each such
    representation letter shall be dated on or before the date of
    such opinion and shall not have been withdrawn or modified in
    any material respect as of the Effective Time.
|
| | (e) Company Stockholder Approval. The Company
    shall have obtained the Required Stockholder Vote at the Company
    Stockholders Meeting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | (f) Articles of Amalgamation and By-laws. The
    Articles of Amalgamation and By-laws of Parent in effect shall
    be in the form attached hereto as Exhibit 7.03(f)(i) and
    Exhibit 7.03(f)(ii), respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | (g) Material Adverse Effect. No Parent
    Material Adverse Effect shall have occurred since the date of
    this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | (h) Consents. All consents, approvals and
    authorizations legally required to be obtained to consummate the
    Merger shall have been obtained from and made with all
    Governmental Authorities, and all consents from the third
    parties listed in Section 7.02(d) of the Parent Disclosure
    Schedule shall have been obtained.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | (i) Conversion of Parent Securities. All of
    the issued and outstanding Series A Preferred Shares of
    Parent Preferred Stock and $5,000,000 aggregate principal amount
    of Secured Convertible Notes of Parent (Secured
    Convertible Notes) shall have been converted into
    512,015 shares of Parent Common Stock and 504,876 Parent
    Class B Shares; nil Series A Preferred Shares of
    Parent Preferred Stock and nil Secured Convertible Notes shall
    be issued and outstanding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| | (j) Anti-Dilution Provisions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) Each Company Warrant shall have been amended, for no
    additional consideration to the holder, to (A) provide that
    the definition of Additional Shares of Common Stock
    shall specifically exclude any stock options or other securities
    exercisable for, convertible into or exchangeable into capital
    stock (or shares issued upon exercise, conversion or exchange
    thereof), any restricted stock or any other equity granted or
    issued for a compensatory purpose following the Effective Time
    to employees, officers, directors or consultants, and
    (B) delete the last two sentences of Section 1 thereof.
|
| | (ii) The employment agreement dated October 24, 2001
    between Parent and Thomas A. Andruskevich (the
    Andruskevich Employment Agreement) shall have
    been amended, in form reasonably satisfactory to the Company,
    for no additional consideration to Mr. Andruskevich, to
    provide that any stock options or other securities exercisable
    for, convertible into or exchangeable                                                                                                                                                                                                                                                 

25



---



##### Table of Contents



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | into capital stock (or shares issued upon exercise, conversion
    or exchange thereof), any restricted stock or any other equity
    granted or issued for a compensatory purpose following the
    Effective Time to employees, officers, directors or consultants
    shall be disregarded for purposes of calculating two percent
    (2%) of the issued and outstanding shares in the capital stock
    of Parent (on a fully diluted basis) pursuant to
    Section 5.1 of the Andruskevich Employment Agreement.





Section Termination.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) by mutual written consent of Parent and the Company
    duly authorized by the Board of Directors of Parent and the
    Special Committee; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | (b) by either Parent or the Company if the Effective Time
    shall not have occurred on or before December 31, 2005;
    provided, however, that the right to terminate
    this Agreement under this Section 8.01(b) shall not be
    available to any party whose material breach of any
    representation, warranty, covenant or agreement under this
    Agreement has been the cause of, or resulted in, the failure of
    the Effective Time to occur on or before such date; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (c) by either Parent or the Company if any Governmental
    Authority shall have enacted, issued, promulgated, enforced or
    entered any injunction, order, decree or ruling (whether
    temporary, preliminary or permanent) which is then in effect and
    has the effect of making consummation of the Merger illegal or
    otherwise preventing or prohibiting consummation of the
    Merger; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | (d) by Parent or the Company if a Company Triggering Event
    (as defined below) shall have occurred; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| | (e) by either Parent or the Company if this Agreement shall
    fail to receive the requisite vote for approval at the Company
    Stockholders Meeting as set forth in Section 7.01(b)
    (other than by reason of a breach by Parent of Section 6.14
    hereof); or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | (f) by Parent upon a breach of any representation,
    warranty, covenant or agreement on the part of the Company set
    forth in this Agreement, or if any representation or warranty of
    the Company shall have become untrue, in either case such that
    the conditions set forth in Section 7.02(a) and
    Section 7.02(b) would not be satisfied
    (Terminating Company Breach);
    provided, however, that, if such Terminating
    Company Breach is curable by the Company, Parent may not
    terminate this Agreement under this Section 8.01(f) for so
    long as the Company continues to exercise its best efforts to
    cure such breach, unless such breach is not cured within
    15 days after notice of such breach is provided by Parent
    to the Company; provided, further, that Parent may
    not terminate this Agreement under this Section 8.01(f) if
    such Terminating Company Breach is attributable to action or
    inaction on the part of Parent or its affiliates or
    associates; or
|
| | (g) by the Company upon a breach of any representation,
    warranty, covenant or agreement on the part of Parent and Merger
    Sub set forth in this Agreement, or if any representation or
    warranty of Parent and Merger Sub shall have become untrue, in
    either case such that the conditions set forth in
    Section 7.03(a) and Section 7.03(b) would not be
    satisfied (Terminating Parent Breach);
    provided, however, that, if such Terminating
    Parent Breach is curable by Parent and Merger Sub, the Company
    may not terminate this Agreement under this Section 8.01(g)
    for so long as Parent and Merger Sub continue to exercise their
    best efforts to cure such breach, unless such breach is not
    cured within 15 days after notice of such breach is
    provided by the Company to Parent.                                                                                                                                                                                             

26



---



##### Table of Contents



Company Triggering
Event


Section Effect
of Termination. provided however


Section Fees
and Expenses. provided however Expenses


Section Amendment. provided however


Section Waiver.




GENERAL PROVISIONS


Section Non-Survival
of Representations, Warranties and Agreements.


27



---



##### Table of Contents



Section Notices.




| |                            
| | ---------------------------
| | if to Parent or Merger Sub:
|
| | Henry Birks & Sons Inc.    
| | 1240 Square Phillips       
| | Montreal, Quebec           
| | H3B 3H4                    

| |            |                      
| | ---------- | ---------------------
| | Attention: | Sabine Bruckert, Esq.

| |                         
| | ------------------------
| | bruckerts@birks.com     
|
| | with a copy to:         
|
| | Shearman & Sterling LLP 
| | 199 Bay Street          
| | Commerce Court West     
| | Suite 4405, P.O. Box 247
| | Toronto, Ontario        
| | M5L 1E8 CANADA          

| |            |                     
| | ---------- | --------------------
| | Attention: | Brice T. Voran, Esq.

| |                          
| | -------------------------
| | bvoran@shearman.com      
|
| | and                      
|
| | Adam
    M. Givertz, Esq.
| | agivertz@shearman.com    
|
| | if to the Company:       
|
| | Mayors Jewelers, Inc.   
| | 14051 N.W. 14th Street   
| | Sunrise, Florida 33323   

| |            |               
| | ---------- | --------------
| | Attention: | Marc Weinstein

| |                                                            
| | -----------------------------------------------------------
| | mweinstein@mayors.com                                      
|
| | and                                                        
|
| | Ann
    Spector Lieff, Chairperson of the Special Committee
| | annlieff@aol.com                                           
|
| | with a copy to:                                            
|
| | Holland & Knight LLP                                       
| | 701 Brickell Avenue                                        
| | Suite 3000                                                 
| | Miami, Florida 33131                                       

| |            |                     
| | ---------- | --------------------
| | Attention: | Rodney H. Bell, Esq.

| |                       
| | ----------------------
| | rodney.bell@hklaw.com 
|
| | and                   
|
| | King & Spalding LLP   
| | 191 Peachtree Street  
| | Atlanta, Georgia 30303

| |            |                        
| | ---------- | -----------------------
| | Attention: | C. William Baxley, Esq.

| |                  
| | -----------------
| | bbaxley@kslaw.com

28



---



##### Table of Contents



Section Certain
Definitions.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | affiliate of a specified person means a
    person who, directly or indirectly through one or more
    intermediaries, controls, is controlled by, or is under common
    control with, such specified person.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | associate of a specified person has the
    meaning ascribed to such term under Rule 12b-2 of the
    Exchange Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | business day means any day on which the
    principal offices of the SEC in Washington, D.C. are open
    to accept filings, or, in the case of determining a date when
    any payment is due, any day on which banks are not required or
    authorized to close in The City of New York and/or Montreal,
    Quebec.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | Company Material Adverse Effect means any
    event, circumstance, change or effect that, individually or in
    the aggregate with all other events, circumstances, changes and
    effects, is or is reasonably likely to be materially adverse to
    (i) the business, condition (financial or otherwise),
    assets, liabilities or results of operations of the Company and
    its subsidiaries taken as a whole or (ii) the ability of
    the Company to consummate the transactions contemplated by this
    Agreement; provided, however, that clause (i)
    shall not include any event, circumstance, change or effect
    resulting from (x) changes in general economic conditions,
    changes in the stock price of the Company, or changes in
    securities markets in general that do not have a materially
    disproportionate effect (relative to other industry
    participants) on the Company or its subsidiaries,
    (y) general changes in the industries in which the Company
    and its subsidiaries operate, except those events,
    circumstances, changes or effects that adversely affect the
    Company and its subsidiaries to a materially greater extent than
    they affect other entities operating in such industries or
    (z) the public announcement or pendency of the transactions
    contemplated hereby.
|
| | Company Preferred Stock means the shares of
    preferred stock, par value $0.0001 per share, of the
    Company designated as Series A-1 Convertible
    Preferred Stock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | control (including the terms
    controlled by and under common
    control with) means the possession, directly or
    indirectly, or as trustee or executor, of the power to direct or
    cause the direction of the management and policies of a person,
    whether through the ownership of voting securities, as trustee
    or executor, by contract or credit arrangement or otherwise.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| | Disinterested Stockholder Vote means the
    affirmative vote in favor of the approval and adoption of this
    Agreement by at least a majority of the outstanding shares of
    Company Common Stock voted, in person or by proxy (but not
    including a vote that is not counted as either affirmative or
    negative), at the Company Stockholder meeting by persons other
    than Parent or any person that is an affiliate or associate of
    Parent.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | Environmental Laws means any United States
    federal, state or local or Canadian federal, provincial or local
    or non-United States or Canadian Laws relating to
    (i) releases or threatened releases of Hazardous Substances
    or materials containing Hazardous Substances; (ii) the
    manufacture, handling, transport, use, treatment, storage or
    disposal of Hazardous Substances or materials containing
    Hazardous Substances; or (iii) pollution or protection of
    the environment, health, safety or natural resources.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | five-percent transferee shareholder means any
    person who owns at least five percent of either the total voting
    power or total value of the stock of Parent immediately after
    the Merger after applying the rules of
    Section 1.367(a)-3(c)(4) of the income tax regulations
    promulgated under the Code.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | Hazardous Substances means (i) petroleum
    and petroleum products, including crude oil and any fractions
    thereof; (ii) natural gas, synthetic gas, and any mixtures
    thereof; (iii) polychlorinated biphenyls, asbestos and
    radon; (iv) any other contaminant; and (v) any
    substance, material or waste regulated by any Governmental
    Authority pursuant to any Environmental Law.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | Intellectual Property means (i) United
    States, Canadian and international patents, patent applications
    and statutory invention registrations, (ii) trademarks,
    service marks, trade dress, logos, trade names, corporate names
    and other source identifiers, and registrations and applications
    for registration                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

29



---



##### Table of Contents



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | thereof, (iii) copyrightable works, copyrights, and
    registrations and applications for registration thereof, and
    (iv) confidential and proprietary information, including
    trade secrets and know-how.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | knowledge when used in reference to Parent,
    means actual knowledge of any executive officer of Parent who is
    also an executive officer of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | Parent Material Adverse Effect means any
    event, circumstance, change or effect that, individually or in
    the aggregate with all other events, circumstances, changes and
    effects, is or is reasonably likely to be materially adverse to
    (i) the business, condition (financial or otherwise),
    assets, liabilities or results of operations of Parent and the
    Subsidiaries taken as a whole or (ii) the ability of Parent
    to consummate the transactions contemplated by this Agreement;
    provided, however, that clause (i) shall not
    include any event, circumstance, change or effect resulting from
    (x) changes in general economic conditions or changes in
    securities markets in general that do not have a materially
    disproportionate effect (relative to other industry
    participants) on Parent or the Subsidiaries, (y) general
    changes in the industries in which Parent and the Subsidiaries
    operate, except those events, circumstances, changes or effects
    that adversely affect Parent and the Subsidiaries to a
    materially greater extent than they affect other entities
    operating in such industries or (z) the public announcement
    or pendency of the Transactions.
|
| | person means an individual, corporation,
    partnership, limited partnership, limited liability company,
    syndicate, person (including, without limitation, a
    person as defined in Section 13(d)(3) of the
    Exchange Act), trust, association or entity or government,
    political subdivision, agency or instrumentality of a government.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | Required Company Vote means the affirmative
    vote in favor of the approval and adoption of this Agreement by
    the holders of the Company Common Stock and the Company
    Preferred Stock, voting as a single class, representing at least
    a majority of the sum of (i) the outstanding shares of
    Company Common Stock and (ii) the shares of Company Common
    Stock into which the outstanding shares of Company Preferred
    Stock are convertible.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| | subsidiary or subsidiaries
    means, with respect to any person, any corporation or other
    entity of which securities or other ownership interests having
    ordinary voting power to elect a majority of the board of
    directors or other persons performing similar functions are
    directly or indirectly owned by such person.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| | Taxes shall mean any and all taxes, fees,
    levies, duties, tariffs, imposts and other charges of any kind
    (together with any and all interest, penalties, additions to tax
    and additional amounts imposed with respect thereto) imposed by
    any Governmental Authority or taxing authority, including,
    without limitation: taxes or other charges on or with respect to
    income, franchise, windfall or other profits, gross receipts,
    property, sales, use, capital stock, payroll, employment, social
    security, workers compensation, unemployment compensation
    or net worth; taxes or other charges in the nature of excise,
    withholding, ad valorem, stamp, transfer, value-added or gains
    taxes; license, registration and documentation fees; and
    customers duties, tariffs and similar charges.                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | (b) Unless otherwise noted, all references to $
    or dollars shall mean U.S. dollars.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| | (c) The following terms have the meaning set forth in the
    Sections set forth below:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

|                             |  |                       
|---------------------------- |  | ----------------------
|Defined Term                 |  | Location of Definition
|                             |  |                       
|Action                       |  | § 4.11                
|Agreement                    |  | Preamble              
|AMEX                         |  | § 2.02(e)             
|Audited Financial Statements |  | § 4.08                
|Blue Sky Laws                |  | § 3.02(b)             
|Certificate of Merger        |  | § 1.02                
|Certificates                 |  | § 2.02(b)             
|Closing                      |  | § 1.02                

30



---



##### Table of Contents



|                                      |  |                       
|------------------------------------- |  | ----------------------
|Defined Term                          |  | Location of Definition
|                                      |  |                       
|Code                                  |  | Recitals              
|Company                               |  | Preamble              
|Company Board                         |  | Recitals              
|Company Common Stock                  |  | § 2.01(a)             
|Company Disclosure Schedule           |  | § 3.02                
|Company Recommendation                |  | § 6.01(b)             
|Company Restricted Stock Award        |  | § 2.05                
|Company Stock Options                 |  | § 2.04(a)             
|Company Stock Option Plans            |  | § 2.04(a)             
|Company Stockholders Meeting         |  | § 6.01(a)             
|Company Triggering Event              |  | § 8.01                
|Company Warrants                      |  | § 2.06(a)             
|Company Warrant Agreements            |  | § 2.06(a)             
|Confidentiality Agreement             |  | § 6.03(b)             
|DGCL                                  |  | Recitals              
|Effective Time                        |  | § 1.02                
|Environmental Permits                 |  | § 4.17                
|Exchange Act                          |  | § 3.02(b)             
|Exchange Agent                        |  | § 2.02(a)             
|Exchange Fund                         |  | § 2.02(a)             
|Exchange Ratio                        |  | § 2.01(a)             
|Expenses                              |  | § 8.03                
|Financial Statements                  |  | § 4.08                
|GAAP                                  |  | § 4.10(a)             
|Governmental Authority                |  | § 3.02(b)             
|HLHZ Fairness Opinion                 |  | § 3.05                
|Inventories                           |  | § 4.25                
|IRS                                   |  | § 6.08(b)             
|ITA                                   |  | § 2.02(i)             
|Law                                   |  | § 3.02(a)             
|Lease Documents                       |  | § 4.14(b)             
|Liens                                 |  | § 4.14(a)             
|Material Contracts                    |  | § 4.18(a)             
|Material Subsidiary                   |  | § 4.01(c)             
|Merger                                |  | Recitals              
|Merger Consideration                  |  | § 2.01(a)             
|Merger Sub                            |  | Preamble              
|Order                                 |  | § 7.01(c)             
|Parent                                |  | Preamble              
|Parent Board                          |  | Recitals              
|Parent Class B Shares                 |  | § 4.03(a)             
|Parent Common Stock                   |  | § 2.01(a)             
|Parent Disclosure Schedule            |  | § 4.01(b)             
|Parent Licensed Intellectual Property |  | § 4.15                

31



---



##### Table of Contents



|                                   |  |                       
|---------------------------------- |  | ----------------------
|Defined Term                       |  | Location of Definition
|                                   |  |                       
|Parent Owned Intellectual Property |  | § 4.15                
|Parent Permits                     |  | § 4.06                
|Parent Preferred Stock             |  | § 4.03(a)             
|Parent SEC Reports                 |  | § 4.07                
|Parent Stock Option Plan           |  | § 4.03(a)             
|Permitted Liens                    |  | § 4.14(a)             
|Plans                              |  | § 4.12(a)             
|Proxy Statement                    |  | § 6.01(a)             
|Registration Statement             |  | § 6.01(a)             
|Representatives                    |  | § 6.03(a)             
|SEC                                |  | § 4.07                
|Secured Convertible Notes          |  | § 7.03(i)             
|Securities Act                     |  | § 4.03(d)             
|Shares                             |  | § 2.01(a)             
|Special Committee                  |  | Recitals              
|Subsidiary                         |  | § 4.01                
|Subsidiaries                       |  | § 4.01                
|Substitute Option                  |  | § 2.04(a)             
|Substitute Warrant                 |  | § 2.06(a)             
|Surviving Corporation              |  | § 1.01                
|Terminating Company Breach         |  | § 8.01(f)             
|Terminating Parent Breach          |  | § 8.01(g)             
|Transactions                       |  | § 3.01                
|Unaudited Financial Statements     |  | § 4.08                

Section Severability.


Section Entire
Agreement; Assignment.


Section Parties
in Interest.


Section Specific
Performance.


32



---



##### Table of Contents



Section Governing
Law.


Section Waiver
of Jury Trial.


Section Headings.


Section Counterparts.


Section Special
Committee.


33



---



##### Table of Contents







| |                        
| | -----------------------
| | HENRY BIRKS & SONS INC.



| |     |                           
| | --- | --------------------------
| | By: | /s/ Thomas A. Andruskevich

| |                              
| | -----------------------------
| |                              
| | Name:  Thomas A. Andruskevich

| |        |                                    
| | ------ | -----------------------------------
| | Title: | President & Chief Executive Officer



| |                         
| | ------------------------
| | BIRKS MERGER CORPORATION



| |     |                           
| | --- | --------------------------
| | By: | /s/ Thomas A. Andruskevich

| |                              
| | -----------------------------
| |                              
| | Name:  Thomas A. Andruskevich

| |        |          
| | ------ | ---------
| | Title: | President



| |                       
| | ----------------------
| | MAYORS JEWELERS, INC.



| |     |                   
| | --- | ------------------
| | By: | /s/ Marc Weinstein

| |                      
| | ---------------------
| |                      
| | Name:  Marc Weinstein

| |        |                                   
| | ------ | ----------------------------------
| | Title: | SVP & Chief Administrative Officer

34



---



##### Table of Contents



EXHIBIT 6.06


FORM OF AFFILIATE LETTER FOR


AFFILIATES OF THE COMPANY














Company Rules and
Regulations Commission Act Merger
Agreement Parent Merger
Sub Merger


Parent
Shares Company Shares






| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A. I shall not make any sale, transfer or other disposition
    of the Parent Shares in violation of the Act or the Rules and
    Regulations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|
| | B. I have carefully read this letter and the Merger
    Agreement and discussed the requirements of such documents and
    other applicable limitations upon my ability to sell, transfer
    or otherwise dispose of the Parent Shares, to the extent I felt
    necessary, with my counsel or counsel for the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| | C. I have been advised that the issuance of the Parent
    Shares to me pursuant to the Merger has been registered with the
    Commission under the Act on a Registration Statement on
    Form F-4. However, I have also been advised that, because
    at the time the Merger is submitted for a vote of the
    shareholders of the Company, (a) I may be deemed to be an
    affiliate of the Company and (b) the distribution by me of
    the Parent Shares has not been registered under the Act, I may
    not sell, transfer or otherwise dispose of the Parent Shares
    issued to me in the Merger unless (i) such sale, transfer
    or other disposition is made in conformity with the volume and
    other limitations of Rule 145 promulgated by the Commission
    under the Act, (ii) such sale, transfer or other
    disposition has been registered under the Act or (iii) in
    the opinion of counsel reasonably acceptable to Parent, such
    sale, transfer or other disposition is otherwise exempt from
    registration under the Act.
|
| | D. I understand that Parent is under no obligation to
    register the sale, transfer or other disposition of the Parent
    Shares by me or on my behalf under the Act or, except as
    provided in paragraph 2(A) below, to take any other action
    necessary in order to make compliance with an exemption from
    such registration available.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                





---



##### Table of Contents





| |                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | E. I understand that there will be placed on the
    certificates for the Parent Shares issued to me, or any
    substitutions therefor, a legend stating in substance:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN
    A TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE
    SECURITIES ACT OF 1933 APPLIES. THE SHARES REPRESENTED BY THIS
    CERTIFICATE MAY ONLY BE TRANSFERRED IN ACCORDANCE WITH THE TERMS
    OF AN AGREEMENT DATED
    [                    ],
    2005 BETWEEN THE REGISTERED HOLDER HEREOF AND HENRY
    BIRKS & SONS INC., A COPY OF WHICH AGREEMENT IS ON FILE
    AT THE PRINCIPAL OFFICES OF HENRY BIRKS & SONS
    INC.



| |                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | F. I understand that unless a sale or transfer is made in
    conformity with the provisions of Rule 145, or pursuant to
    a registration statement, Parent reserves the right to put the
    following legend on the certificates issued to my transferee:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
    REGISTERED UNDER THE SECURITIES ACT OF 1933 AND WERE ACQUIRED
    FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH
    RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF 1933 APPLIES.
    THE SHARES HAVE BEEN ACQUIRED BY THE HOLDER NOT WITH A VIEW TO,
    OR FOR RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF
    WITHIN THE MEANING OF THE SECURITIES ACT OF 1933 AND MAY NOT BE
    SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH
    AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
    SECURITIES ACT OF 1933.



| |                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | G. Execution of this letter should not be considered an
    admission on my part that I am an affiliate of the
    Company as described in the first paragraph of this letter, nor
    as a waiver of any rights I may have to object to any claim that
    I am such an affiliate on or after the date of this letter.





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | A. For so long as and to the extent necessary to permit me
    to sell the Parent Shares pursuant to Rule 145 and, to the
    extent applicable, Rule 144 under the Act, Parent shall
    (a) use its reasonable efforts to (i) file, on a
    timely basis, all reports and data required to be filed with the
    Commission by it pursuant to Section 13 of the Securities
    Exchange Act of 1934, as amended (the Exchange
    Act), and (ii) furnish to me upon request a
    written statement as to whether Parent has complied with such
    reporting requirements during the 12 months preceding any
    proposed sale of the Parent Shares by me under Rule 145,
    and (b) otherwise use its reasonable efforts to permit such
    sales pursuant to Rule 145 and Rule 144. Parent hereby
    represents to me that it has filed all reports required to be
    filed with the Commission under Section 13 of the Exchange
    Act during the preceding 12 months.
|
| | B. It is understood and agreed that certificates with the
    legends set forth in paragraphs I(E) and l(F) above will be
    substituted by delivery of certificates without such legends if
    (i) one year shall have elapsed from the date the
    undersigned acquired the Parent Shares received in the Merger
    and the provisions of Rule 145(d)(2) are then available to
    the undersigned, (ii) two years shall have elapsed from the
    date the undersigned acquired the Parent Shares received in the
    Merger and the provisions of Rule 145(d)(3) are then
    applicable to the undersigned, or (iii) Parent has received
    either an opinion of counsel, which opinion and counsel shall be
    reasonably satisfactory to Parent, or a no action
    letter                                                                                                                                                                                          

Exhibit 6.062



---



##### Table of Contents



| |                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | obtained by the undersigned from the staff of the Commission, to
    the effect that the restrictions imposed by Rule 145 under
    the Act no longer apply to the undersigned.



| |                  
| | -----------------
| | Very truly yours,



| |      
| | -----
| |      
| | Name:









|    | 
|--- | 
|By: | 








Exhibit 6.063



---



##### Table of Contents



Exhibit 7.03(f)(i)


CANADA BUSINESS


CORPORATIONS ACT


ARTICLES




|   |                        
|-- | -----------------------
|1. | Name of the Corporation





|   |                                                                                
|-- | -------------------------------------------------------------------------------
|2. | The province or territory in Canada where the registered
    office is situated





|   |                                                                                             
|-- | --------------------------------------------------------------------------------------------
|3. | The classes and any maximum number of shares that the
    Corporation is authorized to issue





|   |                                         
|-- | ----------------------------------------
|4. | Restrictions, if any, on share transfers





|   |                                                    
|-- | ---------------------------------------------------
|5. | Number (or minimum and maximum number) of directors





|   |                                                                       
|-- | ----------------------------------------------------------------------
|6. | Restrictions, if any, on the business the Corporation may
    carry on





|   |                         
|-- | ------------------------
|7. | Other provisions, if any







Exhibit 7.03(f)(i) - 1



---



##### Table of Contents



Schedule 1




|   |                                                                                          
|-- | -----------------------------------------------------------------------------------------
|3. | The classes and maximum number of shares that the Corporation
    is authorized to issue:







Canada Business Corporations Act




|   |                                                                                                                             
|-- | ----------------------------------------------------------------------------------------------------------------------------
|I. | The Class A Voting Shares shall have attached thereto
    the following rights, privileges, restrictions and
    conditions:

Voting.


Ranking on Liquidation.





Dividends and Distributions.





Right of Participation in a Sale
Transaction.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) No holder of Class B Multiple Voting Shares (a
    Selling Holder) shall sell, transfer or otherwise
    dispose of Class B Multiple Voting Shares if, immediately
    following such sale, transfer or disposition of Class B
    Multiple Voting Shares, such Selling Holder and its Affiliates
    shall control less than a majority of the total voting rights
    attached to the Common Shares issued and outstanding on the date
    of such sale, transfer or disposition (a Sale
    Transaction), unless all other holders of Common Shares
    shall have the right (A) to receive the same consideration
    (on a per share basis), whether cash, non-cash or some
    combination thereof, as that to be received by the Selling
    Holder pursuant to the Sale Transaction and (B) to
    participate in such Sale Transaction on the same terms as the
    Selling Holder in all other material respects, including in
    respect of the conditions to such Sale Transaction. Written
    notice of any Sale Transaction, which notice shall specify the
    terms of such Sale Transaction and the right of all holders of
    Common Shares to participate in such Sale Transaction, shall be
    provided to the holders of Common Shares by first class mail, at
    least twenty (20) business days prior to the consummation
    of such Sale Transaction.

Exhibit 7.03(f)(i) - 2



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii) Any Sale Transaction not in compliance with subsection
    (e)(i) above shall be null and void and shall not be registered
    in the books of the Corporation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| | (iii) Notwithstanding the foregoing, none of the following
    shall constitute a Sale Transaction: (A) any pledge,
    mortgage, hypothecation, lien or similar encumbrance, whether by
    possession or registration, of Class B Multiple Voting
    Shares which creates a security interest in favor of another
    person or entity, and (B) any sale, transfer or other
    disposition of Class B Multiple Voting Shares to
    Affiliates, Associates or shareholders of the transferor of such
    Class B Multiple Voting Shares. For purposes of these
    Articles, an Affiliate means a person that directly
    or indirectly through one or more intermediaries, controls, is
    controlled by, or is under common control with, such specified
    person. For purposes of these Articles, an
    Associate, when used to indicate a relationship with
    any person, means (x) any trust or other estate in which
    such person has a substantial beneficial interest or as to which
    such person serves as trustee or in a similar fiduciary capacity
    and (y) a spouse or child of such person.

Right of Participation in a Business
Combination.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (i) The Corporation shall not consummate a Business
    Combination unless the holders of Class A Voting Shares
    shall have the right (A) to receive the same consideration
    (on a per share basis), whether cash, non-cash or some
    combination thereof, as that to be received by the holders of
    Class B Multiple Voting Shares in connection with such
    Business Combination and (B) to participate in such
    Business Combination on the same terms as the holders of
    Class B Multiple Voting Shares in all other material
    respects, including in respect of the conditions to such
    Business Combination.
|
|
| | (ii) Business Combination as used herein shall
    mean, whether in one or a series of related transactions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             



| |                                                                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (A) any merger, amalgamation, recapitalization or
    consolidation involving the Corporation, other than a merger,
    amalgamation, recapitalization, consolidation or similar
    transaction with a wholly-owned subsidiary of the Corporation or
    which is solely for the purpose of continuance of the
    Corporation as a corporation in another jurisdiction;
|
| | (B) any sale, lease, exchange, transfer or other
    disposition involving 50% or more of the assets of the
    Corporation and its subsidiaries, on a consolidated basis; or                                                                                                                                                                                            
|
| | (C) any agreement, contract or other arrangement having the
    same purpose or effect as the transactions described in (A) and
    (B) above.                                                                                                                                                                                                                           

Transactions or Actions Requiring Special
Approval.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) In addition to any other approvals required under the
    Act, prior to consummating a Related Party Transaction, the
    Corporation shall obtain (A) the consent of the majority of
    a committee of independent directors of the Corporation and
    (B) with respect to clauses (x) and (y) of the
    definition of Related Party Transaction below, the affirmative
    vote in favor of the approval of the Related Party Transaction
    by the majority of the holders of Class A Voting Shares
    (exclusive of Class A Voting Shares held by the Related
    Person (and its Affiliates and Associates) which is or would be
    a party to such Related Party Transaction) that cast a vote, in
    person or by proxy (but not including any vote that is not
    counted as either an affirmative or negative vote), at the
    annual or special shareholders meeting at which such Related
    Party Transaction is considered.                                     
|
|
| | (ii) For purposes of these Articles, (A) Related
    Party Transaction shall mean (x) consummation of a
    Business Combination with a Related Person; (y) amending,
    repealing or altering in anyway any provision of these Articles
    or the By-laws of the Corporation, except for matters not having
    an adverse effect on the holders of Class A Voting Shares;
    or (z) the issuance, sale, exchange, transfer or other
    disposition (in one transaction or a series of related
    transactions) by the Corporation or any wholly-owned subsidiary
    of the Corporation of any securities of the Corporation or of
    such subsidiary to a Related Person (other than pursuant to: an
    employee or director stock incentive plan or other compensation
    arrangements approved by the Compensation Committee of the
    Corporation; an offering made to all holders of Class A
    Voting Shares; or a public offering); and (B) Related
    Person shall
|

Exhibit 7.03(f)(i) - 3



---



##### Table of Contents



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | mean any individual, corporation, partnership, group,
    association or other person or entity that, together with its
    Affiliates and Associates, beneficially owns Class A Voting
    Shares and/or Class B Multiple Voting Shares which, in the
    aggregate, equal twenty percent (20%) or more of the total
    voting rights attached to the Common Shares issued and
    outstanding at the time the definitive agreement with respect to
    a Related Party Transaction is executed.

Subdivision, Consolidation, Reclassification or
other Change.


Equal Status.




|    |                                                                                                                                      
|--- | -------------------------------------------------------------------------------------------------------------------------------------
|II. | The Class B Multiple Voting Shares shall have attached
    thereto the following rights, privileges, restrictions and
    conditions:

Voting.





Ranking on Liquidation.





Dividends and Distributions.


Conversion by Holder into Class A Voting
Shares.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) the holder of Class B Multiple Voting Shares shall
    send to the transfer agent of the Corporation a written notice,
    accompanied by a certificate or certificates representing the
    Class B Multiple Voting Shares in respect of which the
    holder desires to exercise such conversion right. Such notice
    shall be signed by the holder of the Class B Multiple
    Voting Shares in respect of which such right is being exercised,
    or by the duly authorized representative thereof, and shall
    specify the number of Class B Multiple Voting Shares which
    such holder desires to have converted. The holder shall also pay
    any governmental or other tax, if any, imposed in respect of
    such conversion. The conversion of the Class B Multiple
    Voting Shares into Class A Voting Shares shall take effect
    upon receipt by the transfer agent of the Corporation of the
    conversion notice accompanied by the certificate or certificates
    representing the Class B Multiple Voting Shares in respect
    of which the holder desires to exercise such conversion right.

Exhibit 7.03(f)(i) - 4



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii) upon receipt of such notice and certificate or
    certificates by the transfer agent of the Corporation, the
    Corporation shall, effective as of the date of such receipt,
    issue or cause to be issued a certificate or certificates
    representing Class A Voting Shares into which Class B
    Multiple Voting Shares are being converted. If less than all of
    the Class B Multiple Voting Shares represented by any
    certificate are to be converted, the holder shall be entitled to
    receive a new certificate representing the Class B Multiple
    Voting Shares represented by the original certificate which are
    not to be converted.




Subdivision, Consolidation, Reclassification or
other Change.





Equal Status.




|     |                                                                                                                                     
|---- | ------------------------------------------------------------------------------------------------------------------------------------
|III. | The Preferred Shares shall have attached thereto, as a class,
    the following rights, privileges, restrictions and
    conditions:

Issuance of Preferred Shares, in Series.


Determination of Rights, Privileges,
Restrictions, Conditions and Limitations attaching to Series of
Preferred Shares.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) the rate, amount or method of calculation of
    preferential dividends of the Preferred Shares of such series,
    if any, whether cumulative or non-cumulative or partially
    cumulative, and whether such rate, amount or method of
    calculation shall be subject to change or adjustment in the
    future, the currency or currencies of payment, the date or dates
    and place or places of payment thereof and the date or dates
    from which such preferential dividends shall accrue;provided,
    that, the dividends payable with respect to any series of
    Preferred Shares, whether cumulative or non-cumulative or
    partially cumulative, shall not exceed five (5) percent of
    the liquidation preference of such series of Preferred Shares;
|
| | (ii) the redemption price and terms and conditions of
    redemption, if any, of the Preferred Shares of such
    series;provided, that, without the approval by a majority
    of the votes cast at a meeting of shareholders of the Company
    duly called, the redemption price shall not exceed the
    liquidation preference of such shares;                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| | (iii) the rights of retraction, if any, vested in the
    holders of Preferred Shares of such series, and the prices and
    the other terms and conditions of any rights of retraction, and
    whether any additional rights of retraction may be vested in
    such holders in the future; provided, that, without the
    approval by a majority of the votes cast at a meeting of
    shareholders of the Company duly called, the retraction price
    shall not exceed the liquidation preference of such shares;                                                                                                                                                                                                                                                          
|
| | (iv) the voting rights, if any, of the Preferred Shares of
    such series; provided, that, the approval by a majority
    of the votes cast at a meeting of shareholders of the
    Corporation duly called shall be required for the issuance of
    any series of Preferred Shares with voting rights;                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| | (v) the conversion rights and terms and conditions of
    conversion, if any, of the Preferred Shares of such
    series;provided, that, the approval by a majority of the
    votes cast at a meeting of shareholders of the Company duly
    called shall be required for the issuance of any series of
    Preferred Shares which are convertible into securities with
    voting rights;                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (vi) any sinking fund, purchase fund or other provisions
    attaching to the Preferred Shares of such series; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

Exhibit 7.03(f)(i) - 5



---



##### Table of Contents





| |                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (vii) any other relative rights, preferences and
    limitations of the Preferred Shares of such series,                                                                  
|
| | the whole subject to the issue of a certificate of amendment in
    respect of articles of amendment in the prescribed form to
    designate a series of Preferred Shares.

Cumulative Dividends or Return of Capital not
Paid in Full.


Payment of Dividends and Other
Preferences.





Procedure for Payment of Dividends.





Ranking for Payment of Dividends and Liquidation,
Dissolution or Winding-up.


Liquidation, Dissolution or Winding-up.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) an amount equal to the consideration received by the
    Corporation upon the issuance of such shares together with, in
    the case of cumulative Preferred Shares, all unpaid cumulative
    dividends (which for such purpose shall be calculated as if such
    cumulative dividends were accruing from day to day for the
    period from the expiration of the last period for which
    cumulative dividends have been paid-up to and including the date
    of distribution) and, in the case of non-cumulative Preferred
    Shares, all declared and unpaid non-cumulative dividends; and
|
| | (ii) if such liquidation, dissolution, winding-up or
    distribution shall be voluntary, an additional amount equal to
    the premium, if any, which would have been payable on the
    redemption of the said Preferred Shares respectively if they had
    been called for redemption by the Corporation on the date of
    distribution and, if said Preferred Shares could not be redeemed
    on such date, then an additional amount                                                                                                                                                           

Exhibit 7.03(f)(i) - 6



---



##### Table of Contents



| |                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------
| | equal to the greatest premium, if any, which would have been
    payable on the redemption of said Preferred Shares respectively.

Purchase by the Corporation.


Amendments.


Exhibit 7.03(f)(i) - 7



---



##### Table of Contents



Exhibit 7.03(f)(ii)


HENRY BIRKS & SONS INC./ HENRY BIRKS ET FILS INC.





BY-LAW NO. ONE




|                                                                         |                                             |      |   |   | 
|------------------------------------------------------------------------ | ------------------------------------------- | ---- | - | - | 
|                                                                         |                                             | Page |  
|                                                                         |                                             |      |  
|DEFINITIONS                                                              |                                             |      | 1 |  
|                                                                         | Act                                         |      |   | 1 | 
|                                                                         | Articles                                    |      |   | 1 | 
|                                                                         | By-law                                      |      |   | 1 | 
|REGISTERED OFFICE                                                        |                                             |      | 1 |  
|CORPORATE SEAL                                                           |                                             |      | 1 |  
|DIRECTORS                                                                |                                             |      | 1 |  
|                                                                         | Number                                      |      |   | 1 | 
|                                                                         | Vacancies                                   |      |   | 2 | 
|                                                                         | Vacation of Office                          |      |   | 2 | 
|                                                                         | Election                                    |      |   | 2 | 
|                                                                         | Consent to be Elected or Appointed Director |      |   | 2 | 
|MEETINGS OF DIRECTORS                                                    |                                             |      | 3 |  
|                                                                         | Place and Calling of Meetings               |      |   | 3 | 
|                                                                         | Notice                                      |      |   | 3 | 
|                                                                         | Waiver of Notice                            |      |   | 3 | 
|                                                                         | Participation by Communication Facilities   |      |   | 3 | 
|                                                                         | Adjournment                                 |      |   | 3 | 
|                                                                         | Quorum and Voting                           |      |   | 3 | 
|                                                                         | Resolution in lieu of Meeting               |      |   | 4 | 
|REMUNERATION OF DIRECTORS                                                |                                             |      | 4 |  
|SUBMISSION OF CONTRACTS OR TRANSACTIONS TO SHAREHOLDERS FOR
    APPROVAL |                                             |      | 4 |  
|CHAIRMAN OF THE BOARD                                                    |                                             |      | 4 |  
|OFFICERS                                                                 |                                             |      | 4 |  
|                                                                         | Appointment of Officers                     |      |   | 4 | 
|                                                                         | Remuneration and Removal of Officers        |      |   | 5 | 
|                                                                         | Duties of Officers may be Delegated         |      |   | 5 | 
|                                                                         | President                                   |      |   | 5 | 
|                                                                         | Vice-President                              |      |   | 5 | 
|                                                                         | Secretary                                   |      |   | 5 | 
|                                                                         | Treasurer                                   |      |   | 5 | 
|                                                                         | Assistant Secretary and Assistant Treasurer |      |   | 6 | 
|COMMITTEES                                                               |                                             |      | 6 |  
|                                                                         | Appointment of Committees                   |      |   | 6 | 
|                                                                         | Audit Committee                             |      |   | 6 | 
|                                                                         | Nominating Committee                        |      |   | 6 | 
|                                                                         | Corporate Governance Committee              |      |   | 6 | 





---



##### Table of Contents



|                                                                     |                                                 |      |    |    | 
|-------------------------------------------------------------------- | ----------------------------------------------- | ---- | -- | -- | 
|                                                                     |                                                 | Page |   
|                                                                     |                                                 |      |   
|                                                                     | Executive Committee                             |      |    | 7  | 
|                                                                     | Compensation Committee                          |      |    | 7  | 
|DISCLOSURE OF INTEREST                                               |                                                 |      | 7  |   
|INDEMNIFICATION AND PROTECTION OF DIRECTORS, OFFICERS AND
    OTHERS |                                                 |      | 8  |   
|                                                                     | Liability                                       |      |    | 8  | 
|                                                                     | Indemnification                                 |      |    | 8  | 
|                                                                     | Insurance                                       |      |    | 9  | 
|MEETINGS OF SHAREHOLDERS                                             |                                                 |      | 9  |   
|                                                                     | Annual Meeting                                  |      |    | 9  | 
|                                                                     | Special Meetings                                |      |    | 9  | 
|                                                                     | Place of Meetings                               |      |    | 9  | 
|                                                                     | Notice                                          |      |    | 9  | 
|                                                                     | Omission of Notice                              |      |    | 9  | 
|                                                                     | Record Date                                     |      |    | 10 | 
|                                                                     | Participation by Communication Facilities       |      |    | 10 | 
|                                                                     | Votes                                           |      |    | 10 | 
|                                                                     | Proxies                                         |      |    | 11 | 
|                                                                     | Adjournment                                     |      |    | 12 | 
|                                                                     | Quorum                                          |      |    | 12 | 
|SECURITIES                                                           |                                                 |      | 12 |   
|                                                                     | Certificates                                    |      |    | 12 | 
|                                                                     | Registrar and Transfer Agent                    |      |    | 12 | 
|                                                                     | Surrender of Share Certificates                 |      |    | 12 | 
|                                                                     | Defaced, Destroyed, Stolen or Lost Certificates |      |    | 13 | 
|DIVIDENDS                                                            |                                                 |      | 13 |   
|NOTICES                                                              |                                                 |      | 13 |   
|                                                                     | Method of Giving Notices                        |      |    | 13 | 
|                                                                     | Shares registered in more than one (1) name     |      |    | 13 | 
|                                                                     | Persons becoming entitled by operation of law   |      |    | 13 | 
|                                                                     | Deceased Shareholder                            |      |    | 14 | 
|                                                                     | Signatures to Notices                           |      |    | 14 | 
|                                                                     | Computation of Time                             |      |    | 14 | 
|                                                                     | Proof of Service                                |      |    | 14 | 
|CHEQUES, DRAFTS, NOTES, ETC.                                         |                                                 |      | 14 |   
|CUSTODY OF SECURITIES                                                |                                                 |      | 14 |   
|EXECUTION OF CONTRACTS, ETC.                                         |                                                 |      | 14 |   
|DECLARATIONS                                                         |                                                 |      | 15 |   
|FISCAL YEAR                                                          |                                                 |      | 15 |   




ii



---



##### Table of Contents



Exhibit 7.03(f)(ii)


BY-LAW NO. ONE




| |                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | being a by-law relating generally to the transaction of the
    business and affairs of Henry Birks & Sons Inc./ Henry
    Birks et Fils Inc. (the Corporation).

DEFINITIONS






| |                                                                                                                                                                                                                                                                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) Act means the Canada Business
    Corporations Act, R.S.C., 1985, chapter C-44, any
    statute that may be substituted therefore and any regulations
    thereunder, as from time to time amended; and any reference to a
    section of the Act is a reference to a section of the Act as
    such section is presently numbered or as it may be renumbered
    from time to time;
|
| | (b) articles means the articles of the
    Corporation, as from time to time amended or restated;                                                                                                                                                                                                                                                                                       
|
| | (c) by-law means this by-law and all
    other by-laws of the Corporation from time to time in force and
    effect;                                                                                                                                                                                                                                                                    
|
| | (d) words importing the singular number only shall include
    the plural and vice versa; words importing the masculine
    gender shall include the feminine and neuter genders and vice
    versa; words importing persons shall include bodies
    corporate, corporations, companies, partnerships, syndicates,
    trusts and any number or aggregate of individuals;                
|
| | (e) the headings used in this by-law are inserted for
    reference purposes only and are not to be considered or taken
    into account in construing the terms or provisions thereof or to
    be deemed in any way to clarify, modify or explain the effect of
    any such terms or provisions; and                                                                                   
|
| | (f) all terms contained in this by-law and which are
    defined in the Act shall have the meanings given to such terms
    in the Act.                                                                                                                                                                                                                                                   

REGISTERED OFFICE




CORPORATE SEAL




DIRECTORS


Number








---



##### Table of Contents



Vacancies




Vacation of Office


ipso facto




| |                                                                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) he dies;                                                                                                                                                                  
|
| | (b) by notice in writing to the Corporation, he resigns his
    office and such resignation, if not effective immediately,
    becomes effective in accordance with its terms;
|
| | (c) he is removed from office in accordance with
    section 109 of the Act; or                                                                                               
|
| | (d) he ceases to be qualified to be a director.                                                                                                                               

Election






Consent to be Elected or Appointed Director






| |                                                                                                                                                                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) the said individual was present at the meeting when the
    election or appointment took place and he did not refuse to hold
    office as a director; or                                                                                                                                                                                                
|
| | (b) the said individual was not present at the meeting when
    the election or appointment took place and the said individual
    consented to hold office as a director in writing before the
    election or appointment or within ten (10) days after it,
    or the said individual has acted as a director pursuant to the
    election or appointment.

2



---



##### Table of Contents



MEETINGS OF DIRECTORS


Place and Calling of Meetings




Notice








Waiver of Notice




Participation by Communication Facilities




Adjournment




Quorum and Voting




3



---



##### Table of Contents







| |                                                                                                                                                                                                        
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) a resident Canadian director who is unable to be
    present approves in writing, or by telephonic, electronic or
    other communication facility, the business transacted at the
    meeting; and
|
| | (b) the required number of resident Canadian directors
    would have been present had that director been present at the
    meeting.                                                                  



Resolution in lieu of Meeting






REMUNERATION OF DIRECTORS




SUBMISSION OF CONTRACTS OR TRANSACTIONS TO SHAREHOLDERS
FOR APPROVAL




CHAIRMAN OF THE BOARD




OFFICERS


Appointment of Officers




4



---



##### Table of Contents





Remuneration and Removal of Officers




Duties of Officers may be Delegated




President




Vice-President




Secretary




Treasurer




5



---



##### Table of Contents





Assistant Secretary and Assistant Treasurer




COMMITTEES


Appointment of Committees




Audit Committee




Nominating Committee




Corporate Governance Committee




6



---



##### Table of Contents



provided, however


Executive Committee




Compensation Committee




DISCLOSURE OF INTEREST










7



---



##### Table of Contents







| |                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) the director or officer is a director or officer or
    acting in a similar capacity, of a party to the contract or
    transaction, or of a party who has a material interest in a
    party to the contract or transaction;
|
| | (b) the director or officer has a material interest in the
    party; or                                                                                                                                                         
|
| | (c) there has been a material change in the nature of the
    directors or the officers interest in the party.                                                                                                                 





| |                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------
| | (a) relates primarily to his remuneration as a director,
    officer, employee or agent of the Corporation or an
    affiliate; or
|
| | (b) is for indemnity or insurance under section 124 of
    the Act.                                                               

INDEMNIFICATION AND PROTECTION OF DIRECTORS, OFFICERS AND
OTHERS


Liability




Indemnification






| |                                                                                                                                                                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) he acted honestly and in good faith with a view to the
    best interests of the Corporation, or, as the case may be, to
    the best interests of the other entity for which the individual
    acted as a director of officer or in a similar capacity at the
    Corporations request; and
|
| | (b) in the case of a criminal or administrative action or
    proceeding that is enforced by a monetary penalty, the
    individual had reasonable grounds for believing that the
    individuals conduct was lawful.                                                                            





8



---



##### Table of Contents



Insurance




MEETINGS OF SHAREHOLDERS


Annual Meeting




Special Meetings










Place of Meetings




Notice




Omission of Notice




9



---



##### Table of Contents



Record Date








| |                                                                                                                                                                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a) the record date for the determination of the
    shareholders entitled to receive notice of a meeting of
    shareholders shall be at the close of business on the day
    immediately preceding the day on which notice is given or sent
    or, if no notice is given, the day on which the meeting is held;
|
| | (b) the record date for the determination of the
    shareholders entitled to vote at a meeting of shareholders shall
    be the day on which the meeting is held or in accordance with
    subsection 138(3) of the Act, if so determined by the
    directors; and                                              
|
| | (c) the record date for the determination of the
    shareholders entitled to receive the financial statements of the
    Corporation shall be the close of business on the day on which
    the directors pass the resolution relating thereto.                                                                  

Participation by communication facilities




Votes












10



---



##### Table of Contents













Proxies










| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The undersigned shareholder
    of                     hereby
    appoints                     of                     or
    failing
    him,                     of                     ,
    as the nominee of the undersigned to attend and act for and on
    behalf of the undersigned at the meeting of the shareholders of
    the said Corporation to be held on
    the           day
    of           ,           ,
    and at any adjournment thereof to the same extent and with the
    same power as if the undersigned were personally present at the
    said meeting or such adjournment thereof.
|
| | Dated this      day
    of           ,          .                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  



| |                                                                       
| | ----------------------------------------------------------------------
| | _______________________________________ 
     Signature of Shareholder







11



---



##### Table of Contents





Adjournment






Quorum




SECURITIES


Certificates




Registrar and Transfer Agent




Surrender of Share Certificates




12



---



##### Table of Contents





Defaced, Destroyed, Stolen or Lost Certificates




DIVIDENDS




NOTICES


Method of Giving Notices




Shares registered in more than one (1) name




Persons becoming entitled by operation of law




13



---



##### Table of Contents





Deceased Shareholder




Signatures to Notices




Computation of Time




Proof of Service




CHEQUES, DRAFTS, NOTES, ETC.




CUSTODY OF SECURITIES






EXECUTION OF CONTRACTS, ETC.




14



---



##### Table of Contents













DECLARATIONS




FISCAL YEAR




15



---



##### Table of Contents



AMENDMENT AGREEMENT


Amendment Agreement Parent Merger Sub Company


WITNESSETH:










Section 1. Amendment
to Section 7.02 of the Agreement.




| |                                                                                                                                                                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The Company shall have issued to Joseph A. Keifer, Marco
    Pasteris and Carlo Coda-Nunziante an aggregate of 125,752
    Company Warrants with an exercise price equal to the closing
    sale price of Company Common Stock on the AMEX on the date of
    issuance of such Company Warrants.

Section 2. Amendment
to Section 7.03 of the Agreement.




| |                                                                                                                                                                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Each Warrant Agreement, dated as of August 20, 2002,
    between Parent, and/or its assignees, and the Company, shall be
    amended to delete Sections 7(a), (b), (c) and
    (d) thereof for no additional consideration to the holder,
    except as set forth in Section 7.02(f) hereof.

Section 3. Amendment
to Exhibit 7.03(f)(i) of the Agreement.


Section 4. Amendment
to Exhibit 7.03(f)(ii) of the Agreement.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Quorum                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| | One (1) person present and holding or representing by proxy
    at least one (1) issued voting share of the Corporation
    shall be the required quorum for the choice of a chairman of the
    meeting and for the adjournment of the meeting; for all other
    purposes, a quorum for any meeting (unless a different number of
    shareholders and/or a different number of shares are required to
    be represented by the Act or by the articles or by the by-law)
    shall be persons present being not less than two (2) in
    number and holding or representing by proxy at least 50% of the
    total voting rights attached to the issued and outstanding
    shares entitled to vote at such meeting. If a quorum is present
    at the opening of a meeting of the shareholders, the
    shareholders present may proceed with the business of the
    meeting, notwithstanding that a quorum is not present throughout
    the meeting.

Section 5. Entire
Agreement.


Section 6. Severability.






---



##### Table of Contents





Section 7. Counterparts.


Section 8. Governing
Law.






| |                        
| | -----------------------
| | HENRY BIRKS & SONS INC.



| |     |                           
| | --- | --------------------------
| | By: | /s/ Thomas A. Andruskevich

| |                                                   
| | --------------------------------------------------
| |                                                   
| | Name:  Thomas A. Andruskevich                     
| | Title:     President & Chief
    Executive Officer
|
|
| | BIRKS MERGER CORPORATION                          



| |     |                           
| | --- | --------------------------
| | By: | /s/ Thomas A. Andruskevich

| |                              
| | -----------------------------
| |                              
| | Name:  Thomas A. Andruskevich
| | Title:     President         
|
| | MAYORS JEWELERS, INC.       



| |     |                   
| | --- | ------------------
| | By: | /s/ Marc Weinstein

| |                                                  
| | -------------------------------------------------
| |                                                  
| | Name:  Marc Weinstein                            
| | Title:     SVP & Chief
    Administrative Officer

2



---



##### Table of Contents



EXHIBIT 7.03(f)(i)


CANADA BUSINESS


CORPORATIONS ACT


ARTICLES




|   |                        
|-- | -----------------------
|1. | Name of the Corporation





|   |                                                                                
|-- | -------------------------------------------------------------------------------
|2. | The province or territory in Canada where the registered
    office is situated





|   |                                                                                             
|-- | --------------------------------------------------------------------------------------------
|3. | The classes and any maximum number of shares that the
    Corporation is authorized to issue





|   |                                         
|-- | ----------------------------------------
|4. | Restrictions, if any, on share transfers





|   |                                                    
|-- | ---------------------------------------------------
|5. | Number (or minimum and maximum number) of directors





|   |                                                                       
|-- | ----------------------------------------------------------------------
|6. | Restrictions, if any, on the business the Corporation may
    carry on





|   |                         
|-- | ------------------------
|7. | Other provisions, if any







Exhibit 7.03(f)(i) - 1



---



##### Table of Contents



Schedule 1




|   |                                                                                          
|-- | -----------------------------------------------------------------------------------------
|3. | The classes and maximum number of shares that the Corporation
    is authorized to issue:







Canada Business Corporations Act




|   |                                                                                                                             
|-- | ----------------------------------------------------------------------------------------------------------------------------
|I. | The Class A Voting Shares shall have attached thereto
    the following rights, privileges, restrictions and
    conditions:

Voting.


Ranking on Liquidation.


Dividends and Distributions.


Right of Participation in a Sale
Transaction.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) No holder of Class B Multiple Voting Shares (a
    Selling Holder) shall sell, transfer or otherwise
    dispose of Class B Multiple Voting Shares if, immediately
    following such sale, transfer or disposition of Class B
    Multiple Voting Shares, such Selling Holder and its Affiliates
    shall control less than a majority of the total voting rights
    attached to the Common Shares issued and outstanding on the date
    of such sale, transfer or disposition (a Sale
    Transaction), unless all other holders of Common Shares
    shall have the right (A) to receive the same consideration
    (on a per share basis), whether cash, non-cash or some
    combination thereof, as that to be received by the Selling
    Holder pursuant to the Sale Transaction and (B) to
    participate in such Sale Transaction on the same terms as the
    Selling Holder in all other material respects, including in
    respect of the conditions to such Sale Transaction. Written
    notice of any Sale Transaction, which notice shall specify the
    terms of such Sale Transaction and the right of all holders of
    Common Shares to participate in such Sale Transaction, shall be
    provided to the holders of Common Shares by first class mail, at
    least twenty (20) business days prior to the consummation of
    such Sale Transaction.
|
| | (ii) Any Sale Transaction not in compliance with subsection
    00 above shall be null and void and shall not be registered in
    the books of the Corporation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

Exhibit 7.03(f)(i) - 2



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (iii) Notwithstanding the foregoing, none of the following
    shall constitute a Sale Transaction: (A) any pledge,
    mortgage, hypothecation, lien or similar encumbrance, whether by
    possession or registration, of Class B Multiple Voting
    Shares which creates a security interest in favor of another
    person or entity, and (B) any sale, transfer or other
    disposition of Class B Multiple Voting Shares to
    Affiliates, Associates or shareholders of the transferor of such
    Class B Multiple Voting Shares. For purposes of these
    Articles, an Affiliate, when used to indicate a
    relationship with any person, means a person that directly or
    indirectly through one or more intermediaries, controls, is
    controlled by, or is under common control with, such specified
    person. For purposes of these Articles, an
    Associate, when used to indicate a relationship with
    any person, means (x) any trust or other estate in which
    such person has a substantial beneficial interest or as to which
    such person serves as trustee or in a similar fiduciary capacity
    and (y) a spouse or child of such person.

Right of Participation in a Business
Combination.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (iv) The Corporation shall not consummate a Business
    Combination unless the holders of Class A Voting Shares
    shall have the right (A) to receive the same consideration
    (on a per share basis), whether cash, non-cash or some
    combination thereof, as that to be received by the holders of
    Class B Multiple Voting Shares in connection with such
    Business Combination and (B) to participate in such
    Business Combination on the same terms as the holders of
    Class B Multiple Voting Shares in all other material
    respects, including in respect of the conditions to such
    Business Combination.
|
| | (v) Business Combination as used herein shall
    mean, whether in one or a series of related transactions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               



| |                                                                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (A) any merger, amalgamation, recapitalization or
    consolidation involving the Corporation, other than a merger,
    amalgamation, recapitalization, consolidation or similar
    transaction with a wholly-owned subsidiary of the Corporation or
    which is solely for the purpose of continuance of the
    Corporation as a corporation in another jurisdiction;
|
| | (B) any sale, lease, exchange, transfer or other
    disposition involving 50% or more of the assets of the
    Corporation and its subsidiaries, on a consolidated
    basis; or                                                                                                                                                                                        
|
| | (C) any agreement, contract or other arrangement having the
    same purpose or effect as the transactions described in
    (A) and (B) above.                                                                                                                                                                                                                           

Transactions or Actions Requiring Special
Approval.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (vi) In addition to any other approvals required under the
    Act or these Articles, prior to consummating a Related Party
    Transaction, the Corporation shall obtain (A) the consent
    of the majority of a committee of independent directors of the
    Corporation and (B) with respect to
    clauses (x) and (y) of the definition of Related
    Party Transaction below, the affirmative vote in favor of the
    approval of the Related Party Transaction by holders of a
    majority of the Class A Voting Shares (exclusive of
    Class A Voting Shares held by the Related Person (and its
    Affiliates and Associates) which is or would be a party to such
    Related Party Transaction) that cast a vote, in person or by
    proxy (but not including any vote that is not counted as either
    an affirmative or negative vote), at the annual or special
    shareholders meeting at which such Related Party Transaction is
    considered.                                                                                                                                                                                                                                                                                                                                                         
|
| | (vii) For purposes of these Articles,
    (A) Related Party Transaction shall mean
    (x) consummation of a Business Combination with a Related
    Person; (y) amending, repealing or altering in anyway any
    provision of these Articles or the By-laws of the Corporation,
    except for matters not having an adverse effect on the holders
    of Class A Voting Shares; or (z) the issuance, sale,
    exchange, transfer or other disposition (in one transaction or a
    series of related transactions) by the Corporation or any
    wholly-owned subsidiary of the Corporation of any securities of
    the Corporation or of such subsidiary to a Related Person (other
    than pursuant to: an employee or director stock incentive plan
    or other compensation arrangements approved by the Compensation
    Committee of the Corporation; an offering made to all holders of
    Class A Voting Shares; or a public offering); and
    (B) Related Person shall mean any individual,
    corporation, partnership, group, association or other person or
    entity that, together with its Affiliates and Associates,
    beneficially owns Class A Voting Shares and/or Class B
    Multiple Voting Shares which, in the aggregate, equal twenty
    percent (20%) or more of the total voting rights

Exhibit 7.03(f)(i) - 3



---



##### Table of Contents



| |                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------
| | attached to the Common Shares issued and outstanding at the time
    the definitive agreement with respect to a Related Party
    Transaction is executed.

Subdivision, Consolidation, Reclassification or
other Change.


Equal Status.


Approval of Issuance.




| |                                                                                                                                                                                                                                                                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (A) Class A Voting Shares, options or warrants under
    any plan or agreement approved by the Corporation prior to
    June 1, 2005 (including without limitation, pursuant to the
    Agreement and Plan of Merger and Reorganization, dated as of
    April 18, 2005 and as thereafter amended, among the
    Corporation, Birks Merger Corporation and Mayors Jewelers,
    Inc.); or
|
| | (B) Class A Voting Shares upon the exercise of an
    option or warrant issued or to be issued under any plan or
    agreement approved by the Corporation prior to June 1,
    2005; or                                                                                                                                                                                                  
|
| | (C) Class A Voting Shares upon the conversion of
    Class B Multiple Voting Shares; or                                                                                                                                                                                                                                                                                                   
|
| | (D) Class A Voting Shares upon the conversion,
    exercise or exchange of any security, obligation or other
    instrument of the Corporation for Class A Voting Shares if
    the issuance of such security, obligation or other instrument of
    the Corporation was previously approved pursuant to this
    paragraph 3.I.(i).                                                      



|    |                                                                                                                                      
|--- | -------------------------------------------------------------------------------------------------------------------------------------
|II. | The Class B Multiple Voting Shares shall have attached
    thereto the following rights, privileges, restrictions and
    conditions:

Voting.


Ranking on Liquidation.


Dividends and Distributions.


Exhibit 7.03(f)(i) - 4



---



##### Table of Contents



Conversion by Holder into Class A Voting
Shares.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) the holder of Class B Multiple Voting Shares shall
    send to the transfer agent of the Corporation a written notice,
    accompanied by a certificate or certificates representing the
    Class B Multiple Voting Shares in respect of which the
    holder desires to exercise such conversion right. Such notice
    shall be signed by the holder of the Class B Multiple
    Voting Shares in respect of which such right is being exercised,
    or by the duly authorized representative thereof, and shall
    specify the number of Class B Multiple Voting Shares which
    such holder desires to have converted. The holder shall also pay
    any governmental or other tax, if any, imposed in respect of
    such conversion. The conversion of the Class B Multiple
    Voting Shares into Class A Voting Shares shall take effect
    upon receipt by the transfer agent of the Corporation of the
    conversion notice accompanied by the certificate or certificates
    representing the Class B Multiple Voting Shares in respect
    of which the holder desires to exercise such conversion right.
|
| | (ii) upon receipt of such notice and certificate or
    certificates by the transfer agent of the Corporation, the
    Corporation shall, effective as of the date of such receipt,
    issue or cause to be issued a certificate or certificates
    representing Class A Voting Shares into which Class B
    Multiple Voting Shares are being converted. If less than all of
    the Class B Multiple Voting Shares represented by any
    certificate are to be converted, the holder shall be entitled to
    receive a new certificate representing the Class B Multiple
    Voting Shares represented by the original certificate which are
    not to be converted.                                                                                                                                                                                                                                                                                                                                                                                                                                                     

Subdivision, Consolidation, Reclassification or
other Change.


Equal Status.


Approval of Issuance.




|     |                                                                                                                                     
|---- | ------------------------------------------------------------------------------------------------------------------------------------
|III. | The Preferred Shares shall have attached thereto, as a class,
    the following rights, privileges, restrictions and
    conditions:

Issuance of Preferred Shares, in Series.


Determination of Rights, Privileges,
Restrictions, Conditions and Limitations attaching to Series of
Preferred Shares.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) the rate, amount or method of calculation of
    preferential dividends of the Preferred Shares of such series,
    if any, whether cumulative or non-cumulative or partially
    cumulative, and whether such rate, amount or method of
    calculation shall be subject to change or adjustment in the
    future, the currency or currencies of payment, the date or dates
    and place or places of payment thereof and the date or dates
    from which such preferential dividends shall accrue; provided,
    that, the dividends payable with respect to

Exhibit 7.03(f)(i) - 5



---



##### Table of Contents



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | any series of Preferred Shares, whether cumulative or
    non-cumulative or partially cumulative, shall not exceed five
    (5) percent of the liquidation preference of such series of
    Preferred Shares;                                                                                                                                                                                                                                                                                                           
|
| | (ii) the redemption price and terms and conditions of
    redemption, if any, of the Preferred Shares of such series;
    provided, that, without the approval by a majority of the votes
    cast at a meeting of shareholders of the Company duly called,
    the redemption price shall not exceed the liquidation preference
    of such shares;                                                                                                                                                                    
|
| | (iii) the rights of retraction, if any, vested in the
    holders of Preferred Shares of such series, and the prices and
    the other terms and conditions of any rights of retraction, and
    whether any additional rights of retraction may be vested in
    such holders in the future; provided, that, without the approval
    by a majority of the votes cast at a meeting of shareholders of
    the Company duly called, the retraction price shall not exceed
    the liquidation preference of such shares;
|
| | (iv) the voting rights, if any, of the Preferred Shares of
    such series; provided, that, the approval by a majority of the
    votes cast at a meeting of shareholders of the Corporation duly
    called shall be required for the issuance of any series of
    Preferred Shares with voting rights;                                                                                                                                                                                                               
|
| | (v) the conversion rights and terms and conditions of
    conversion, if any, of the Preferred Shares of such series;
    provided, that, the approval by a majority of the votes cast at
    a meeting of shareholders of the Company duly called shall be
    required for the issuance of any series of Preferred Shares
    which are convertible into securities with voting rights;                                                                                                                               
|
| | (vi) any sinking fund, purchase fund or other provisions
    attaching to the Preferred Shares of such series; and                                                                                                                                                                                                                                                                                                                                                                                                      
|
| | (vii) any other relative rights, preferences and
    limitations of the Preferred Shares of such series,                                                                                                                                                                                                                                                                                                                                                                                                                



| |                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | the whole subject to the issuance of a certificate of amendment
    in respect of articles of amendment in the prescribed form to
    designate a series of Preferred Shares.

Cumulative Dividends or Return of Capital not
Paid in Full.


Payment of Dividends and Other
Preferences.


Procedure for Payment of Dividends.


Exhibit 7.03(f)(i) - 6



---



##### Table of Contents



Ranking for Payment of Dividends and Liquidation,
Dissolution or Winding-up.


Liquidation, Dissolution or Winding-up.




| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) an amount equal to the consideration received by the
    Corporation upon the issuance of such shares together with, in
    the case of cumulative Preferred Shares, all unpaid cumulative
    dividends (which for such purpose shall be calculated as if such
    cumulative dividends were accruing from day to day for the
    period from the expiration of the last period for which
    cumulative dividends have been paid-up to and including the date
    of distribution) and, in the case of non-cumulative Preferred
    Shares, all declared and unpaid non-cumulative
    dividends; and
|
| | (ii) if such liquidation, dissolution, winding-up or
    distribution shall be voluntary, an additional amount equal to
    the premium, if any, which would have been payable on the
    redemption of the said Preferred Shares respectively if they had
    been called for redemption by the Corporation on the date of
    distribution and, if said Preferred Shares could not be redeemed
    on such date, then an additional amount equal to the greatest
    premium, if any, which would have been payable on the redemption
    of said Preferred Shares respectively.                         

Purchase by the Corporation.


Amendments. 2 3 2 3


Exhibit 7.03(f)(i) - 7



---



##### Table of Contents






APPENDIX B


Opinion of Houlihan Lokey Howard & Zukin




1



---



##### Table of Contents







th


















| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 1. Reviewed the Companys annual reports on
    Form 10-K for the fiscal years ended March 30, 2002,
    March 29, 2003 and March 27, 2004, as well as the
    Form 10-K/ A for the fiscal year ended March 27, 2004;
    the internally prepared monthly financial statements for
    (i) April through March of 2002 and 2003, (ii) March
    through December of 2004, and (iii) January and February
    2005; and quarterly reports on Form 10-Q for the quarter
    and nine months ended December 25, 2004, which the
    Companys management has identified as being the most
    current financial statements available;
|
| | 2. Reviewed Birks audited financial statements for
    the fiscal years ending March 2002, 2003 and 2004 and internally
    prepared financial statements for (i) the fiscal years
    ending March 2002, 2003 and 2004, (ii) the period from
    March through December 2004 and (iii) January and February
    2005;                                                                                                                                                                                                                                                                                                           
|
| | 3. Reviewed monthly CFO reports from both Birks and the
    Company from the period April 2002 through February 2005;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| | 4. Reviewed the Companys and Birks financial
    projections for the fiscal year ending March 2005, as well as
    summary projections for the fiscal years ending March 2006 and
    2007;                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| | 5. Reviewed the combined pro forma projected financial
    statements for Birks giving effect to the Transaction;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|
| | 6. Reviewed the Fiscal Year 2004-2006 Strategic Plan
    documents for each of the Company and Birks;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
| | 7. Reviewed copies of the Agreement and Plan of Merger and
    Reorganization draft dated April 14, 2005;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| | 8. Reviewed the proposed post-Transaction Charter and
    By-Laws of Birks;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       



New York


Los Angeles Chicago San Francisco Washington, D.C.
Minneapolis Dallas Atlanta London




2



---



##### Table of Contents





| |                                                                                                                                                                                                                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 9. Reviewed the Form S-4 draft as of April 6,
    2005 to be filed with Securities and Exchange Commission;                                                                                                                                                                                                                            
|
| | 10. Met with certain members of the senior management of
    the Company and Birks to discuss the respective operations,
    financial condition, future prospects and projected operations
    and performance of Birks and the Company, and met with
    representatives of Birks commercial bankers to discuss
    certain matters;
|
| | 11. Visited certain facilities and business offices of the
    Company and Birks;                                                                                                                                                                                                                                                      
|
| | 12. Reviewed the historical market prices and trading
    volume for the Companys publicly traded securities;                                                                                                                                                                                                                         
|
| | 13. Reviewed certain other publicly available financial
    data for certain companies that we deem comparable to the
    Company, and publicly available prices and premiums paid in
    other transactions that we considered similar to the
    Transaction; and                                                                    
|
| | 14. Conducted such other studies, analyses and inquiries,
    as we have deemed appropriate.                                                                                                                                                                                                                                           









| |                                                             
| | ------------------------------------------------------------
| | HOULIHAN LOKEY HOWARD & ZUKIN 
     FINANCIAL ADVISORS, INC.

3



---



##### Table of Contents



Who Can Help Answer Your Questions




Mayors Jewelers, Inc.


14051 N.W.
14th Street


Sunrise, Florida 33323


(954) 846-2701


Attention: Marc Weinstein


Senior Vice President, Chief Administrative Officer and
Secretary


or


Georgeson Shareholder Communications Inc.


17 State St.
28th Floor


New York, New York 10004





Banks and Brokers call: (212) 404-9800








All other call Toll-Free: (800) 279-8717





To ensure timely delivery prior to the Mayors special
and annual meeting, any request for documents should be received
by
[                    ],
2005.






---



##### Table of Contents



PART II


INFORMATION NOT REQUIRED IN PROSPECTUS




|         |                                          
|-------- | -----------------------------------------
|ITEM 20. | Indemnification of Officers and Directors

Canada Business Corporations Act










II-1



---



##### Table of Contents





|         |                                           
|-------- | ------------------------------------------
|ITEM 21. | Exhibits and Financial Statement Schedules



|        |    |                         |  |                                                                                                                                                                                                                                                                                                                                                                                                      
|------- | -- | ----------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                        
|Number  |    | Description of Document
|        |    |                        
|        | 2  | .1*                     |  | Agreement and Plan of Merger and Reorganization, dated as of
    April 18, 2005, as amended as of July 27, 2005, among
    Henry Birks & Sons Inc., Mayors Jewelers, Inc.
    and Birks Merger Corporation, a wholly-owned subsidiary of Henry
    Birks & Sons Inc. (attached as Appendix A to the proxy
    statement/ prospectus which is part of this Registration
    Statement).              
|       
|        | 3  | .1*                     |  | Articles of Amalgamation of Henry Birks & Sons Inc.                                                                                                                                                                                                                                                                                                                                                  
|       
|        | 3  | .2*                     |  | Form of Articles of Amalgamation, as amended, of Henry
    Birks & Sons Inc. to be in effect upon consummation of
    the merger.                                                                                                                                                                                                                                                                    
|       
|        | 3  | .3*                     |  | By-laws of Henry Birks & Sons Inc.                                                                                                                                                                                                                                                                                                                                                                   
|       
|        | 3  | .4*                     |  | Form of By-laws of Henry Birks & Sons Inc., as amended,
    to be in effect upon consummation of the merger.                                                                                                                                                                                                                                                                                         
|       
|        | 4  | .1*                     |  | Form of Birks Class A voting share certificate.                                                                                                                                                                                                                                                                                                                                                      
|       
|        | 5  | .1**                    |  | Opinion of Stikeman Elliott LLP as to the legality of the
    securities being registered.                                                                                                                                                                                                                                                                                                           
|       
|        | 8  | .1**                    |  | Opinion of Holland & Knight LLP as to certain
    U.S. federal income tax matters.                                                                                                                                                                                                                                                                                                                   
|       
|        | 9  | .1*                     |  | Shareholders Agreement among Management Investors, Henry
    Birks & Sons Holdings Inc. and Birks, dated
    August 31, 1998, as amended as of April 5, 2002.                                                                                                                                                                                                                                       
|       
|        | 9  | .2*                     |  | Shareholders Agreement among Prime Investments SA, Henry
    Birks & Sons Holdings Inc., Marco Pasteris and
    Birks, dated as of August 15, 2002.                                                                                                                                                                                                                                                 
|       
|        | 10 | .1                      |  | Revolving Credit, Tranche B Loan and Security Agreement by
    and among Fleet Retail Finance Inc., GMAC Business Credit, LLC,
    Back Bay Capital Funding LLC and Mayors, dated as of
    August 20, 2002. Incorporated by reference from
    Mayors Form 8-K, dated as of August 20, 2002.                                                                                                      
|       
|        | 10 | .2                      |  | First Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    February 20, 2004, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 10-Q filed
    on January 7, 2005.   
|       
|        | 10 | .3                      |  | Second Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    November 21, 2003, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 10-Q filed
    on February 10, 2004.
|       
|        | 10 | .4                      |  | Third Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    February 20, 2004, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    March 4, 2004.      
|       
|        | 10 | .5                      |  | Fourth Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    September 7, 2004, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    September 13, 2004.
|       
|        | 10 | .6                      |  | Fifth Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    March 4, 2005, by and among Fleet Retail Group, Inc., GMAC
    Commercial Finance, LLC, Back Bay Capital Funding LLC, and the
    domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    March 8, 2005.          
|       
|        | 10 | .7                      |  | Sixth Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    March 4, 2005, by and among Fleet Retail Group, Inc., GMAC
    Commercial Finance, LLC, Back Bay Capital Funding LLC, and the
    domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    May 5, 2005.            
|       
|        | 10 | .8                      |  | Exchange Agreement, dated as of February 20, 2004, between
    Mayors and Birks. Incorporated by reference from
    Mayors Form 8-K filed on March 4, 2004.                                                                                                                                                                                                                                        
|       
|        | 10 | .9                      |  | Management Consulting Services Agreement between Mayors
    and Regaluxe dated as of April 22, 2004. Incorporated by
    reference from Mayors Form 8-K filed on April 29,
    2004.                                                                                                                                                                                                               

II-2



---



##### Table of Contents






|        |    |                         |  |                                                                                                                                                                                                                                                                                   
|------- | -- | ----------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                        
|Number  |    | Description of Document
|        |    |                        
|       
|        | 10 | .10**                   |  | Accounts Receivable Management, Loan and Security Agreement
    among GMAC Commercial Finance Corporation Canada, Birks and
    Henry Birks & Sons U.S., Inc., dated as of
    October 15, 1996, amended and restated as of
    November 19, 2004, as amended as of July 21, 2005.
|       
|        | 10 | .11*                    |  | Option Agreement between Birks, Henry Birks & Sons
    Holdings Inc. and GMAC Commercial Finance Corporation, dated as
    of March 15, 2005.                                                                                                                                     
|       
|        | 10 | .12*                    |  | Loan Agreement between Birks and Regaluxe, dated as of
    February 16, 2004, and as amended as of February 23,
    2005.                                                                                                                                                         
|       
|        | 10 | .13*                    |  | Loan Agreement between Birks and la Financière du
    Québec, dated as of November 27, 2002.                                                                                                                                                                                      
|       
|        | 10 | .14*                    |  | Expense Reimbursement Agreement between Birks and Iniziativa SA,
    dated as of April 1, 2003.                                                                                                                                                                                   
|       
|        | 10 | .15*                    |  | Form of Directors and Officers Indemnity Agreement.                                                                                                                                                                                                                               
|       
|        | 10 | .16*                    |  | Employee Stock Option Agreement dated as of May 1, 1997,
    amended as of June 20, 2000.                                                                                                                                                                                         
|       
|        | 10 | .17*                    |  | Employment Agreement between Thomas A. Andruskevich and Birks,
    dated as of September 27, 2004.                                                                                                                                                                                
|       
|        | 10 | .18*                    |  | Lease Agreement between Birks and Anglo Canadian Investments SA,
    dated as of December 12, 2000.                                                                                                                                                                               
|       
|        | 10 | .19*                    |  | Diamond Supply Agreement between Prime Investments SA and Birks,
    dated as of August 15, 2002.                                                                                                                                                                                 
|       
|        | 10 | .20*                    |  | Conditional Sale Agreement between Rosy Blue N.V. and Birks,
    dated as of August 15, 2002.                                                                                                                                                                                     
|       
|        | 10 | .21*                    |  | Conditional Sale Agreement between Rosy Blue Inc. and Birks,
    dated as of August 15, 2002.                                                                                                                                                                                     
|       
|        | 10 | .22*                    |  | Conditional Sale Agreement between Rosy Blue Sales Ltd. and
    Birks, dated as of August 15, 2002.                                                                                                                                                                               
|       
|        | 10 | .23*                    |  | Conditional Sale Agreement between Rosy Blue Hong Kong Ltd. and
    Birks, dated as of August 15, 2002.                                                                                                                                                                           
|       
|        | 10 | .24*                    |  | Conditional Sale Agreement between Rosy Blue Finance S.A. and
    Birks, dated as of August 15, 2002.                                                                                                                                                                             
|       
|        | 10 | .25*                    |  | Registration Rights Agreement between Birks and Prime
    Investments SA, dated as of February 4, 2005.                                                                                                                                                                           
|       
|        | 10 | .26*                    |  | Secured convertible note between Prime Investments SA and Birks,
    dated as of September 30, 2002, as amended as of
    March 14, 2005.                                                                                                                                         
|       
|        | 10 | .27*                    |  | Offre de Garantie de Prêts between Garantie Québec and
    Birks, dated as of December 15, 1999 and April 9, 2001.                                                                                                                                                                
|       
|        | 10 | .28*                    |  | Employment Agreement between Michael Rabinovitch and
    Mayors, dated as of August 1, 2005.                                                                                                                                                                                     
|       
|        | 10 | .29                     |  | Amended Employment Agreement between Thomas A. Andruskevich and
    Mayors, dated as of June 24, 2004. Incorporated by
    reference from Mayors Form 10-K filed on
    June 25, 2004.                                                                                          
|       
|        | 10 | .30                     |  | Amended Employment Agreement between Albert Rahm II and
    Mayors, dated as of July 19, 2002. Incorporated by
    reference from Mayors Form 10-Q filed
    December 17, 2002.                                                                                                 
|       
|        | 10 | .31                     |  | Amended Employment Agreement between Aida Alvarez and
    Mayors, dated as of July 19, 2002. Incorporated by
    reference from Mayors Form 10-Q filed
    December 17, 2002.                                                                                                   
|       
|        | 10 | .32                     |  | Employment Agreement between Marc Weinstein and Mayors,
    dated as of October 26, 2001. Incorporated by reference
    from Mayors Form 10-Q filed on December 18, 2001.                                                                                                       
|       
|        | 10 | .33                     |  | Amended Employment Agreement between Marc Weinstein and
    Mayors, dated as of July 19, 2002. Incorporated by
    reference from Mayors Form 10-Q filed
    December 17, 2002.                                                                                                 
|       
|        | 10 | .34                     |  | Second Amendment to Employment Agreement between Marc Weinstein
    and Mayors, dated March 31, 2003. Incorporated by
    reference from Mayors Form 10-K filed on
    June 19, 2003.                                                                                           
|       
|        | 10 | .35                     |  | Employment Agreement between Joseph Keifer III and
    Mayors, dated October 1, 2002. Incorporated by
    reference from Mayors Form 10-Q filed on
    December 17, 2002.                                                                                                       
|       
|        | 13 | .1                      |  | Mayors Annual Report on Form 10-K for the year ended
    March 26, 2005, filed on June 24, 2005.                                                                                                                                                                                 
|       
|        | 21 | .1*                     |  | Subsidiaries of Henry Birks & Sons Inc.                                                                                                                                                                                                                                           
|       
|        | 23 | .1**                    |  | Consent of KPMG LLP.                                                                                                                                                                                                                                                              
|       
|        | 23 | .2**                    |  | Consent of KPMG LLP.                                                                                                                                                                                                                                                              
|       
|        | 23 | .3**                    |  | Consent of Deloitte & Touche LLP.                                                                                                                                                                                                                                                 
|       
|        | 23 | .4**                    |  | Consent of Stikeman Elliott LLP (included in Exhibit 5.1).                                                                                                                                                                                                                        
|       
|        | 23 | .5**                    |  | Consent of Holland & Knight LLP.                                                                                                                                                                                                                                                  
|       
|        | 23 | .6**                    |  | Consent of Houlihan Lokey Howard & Zukin.                                                                                                                                                                                                                                         
|       
|        | 24 | .1*                     |  | Powers of Attorney.                                                                                                                                                                                                                                                               




II-3



---



##### Table of Contents



|        |    |                         |  |                                                                                                                                                                                           
|------- | -- | ----------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                        
|Number  |    | Description of Document
|        |    |                        
|       
|        | 99 | .1*                     |  | Form of proxy card for the special and annual meeting of
    stockholders of Mayors Jewelers, Inc.                                                                                       
|       
|        | 99 | .2*                     |  | Form of Letter to the stockholders of Mayors Jewelers,
    Inc. (included in the proxy statement/ prospectus which is part
    of this Registration Statement).                          
|       
|        | 99 | .3*                     |  | Form of Notice of Special and Annual Meeting of stockholders of
    Mayors Jewelers, Inc. (included in the proxy statement/
    prospectus which is part of this Registration Statement).
|       
|        | 99 | .4*                     |  | Opinion of Houlihan Lokey Howard & Zukin (attached as
    Appendix B to the proxy statement/ prospectus which is part of
    this Registration Statement).                                









|  |                  
|- | -----------------
|* | Previously filed.









|   |                
|-- | ---------------
|** | Filed herewith.










|         |             
|-------- | ------------
|ITEM 22. | Undertakings





| |                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------
| | (1) To file, during any period in which offers or sales are
    being made, a post-effective amendment to this registration
    statement:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i) To include any prospectus required by
    section 10(a)(3) of the Securities Act of 1933;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| | (ii) To reflect in the prospectus any facts or events
    arising after the effective date of the registration statement
    (or the most recent post-effective amendment thereof) which,
    individually or in the aggregate, represent a fundamental change
    in the information in the registration statement.
    Notwithstanding the foregoing, any increase or decrease in
    volume of securities offered (if the total dollar value of
    securities offered would not exceed that which was registered)
    and any deviation from the low or high end of the estimated
    maximum offering range may be reflected in the form of
    prospectus filed with the Commission pursuant to
    Rule 424(b) if, in the aggregate, the changes in volume and
    price represent no more than a 20% change in the maximum
    aggregate offering price set forth in the Calculation of
    Registration Fee table in the effective registration
    statement;
|
| | (iii) To include any material information with respect to
    the plan of distribution not previously disclosed in the
    registration statement or any material change to such
    information in the registration statement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) That, for the purpose of determining any liability
    under the Securities Act of 1933, each such post-effective
    amendment shall be deemed to be a new registration statement
    relating to the securities offered therein, and the offering of
    such securities at that time shall be deemed to be the initial
    bona fide offering thereof.                                                                                                                                                                                                                                                                                                                                           
|
| | (3) To remove from registration by means of a
    post-effective amendment any of the securities being registered
    which remain unsold at the termination of the offering.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | (4) To file a post-effective amendment to the registration
    statement to include any financial statements required by
    Item 8.A. of Form 20-F at the start of any delayed
    offering or throughout a continuous offering. Financial
    statements and information otherwise required by
    Section 10(a)(3) of the Act need not be furnished,
    providedthat the registrant includes in the prospectus,
    by means of a post-effective amendment, financial statements
    required pursuant to this paragraph (a)(4) and other
    information necessary to ensure that all other information in
    the prospectus is at least as current as the date of those
    financial statements.

II-4



---



##### Table of Contents







bona fide








II-5



---



##### Table of Contents



SIGNATURES












| |                        
| | -----------------------
| | HENRY BIRKS & SONS INC.
| | (Registrant)           



| |     |                               
| | --- | ------------------------------
| | By: | /s/
    Thomas A. Andruskevich

| |                              
| | -----------------------------
| |                              
| | Name:  Thomas A. Andruskevich

| |        |                                                
| | ------ | -----------------------------------------------
| | Title: | President, Chief Executive Officer and Director












|                                                         |  |                                                              |  |                   |  | 
|-------------------------------------------------------- |  | ------------------------------------------------------------ |  | ----------------- |  | 
|                                                        
|/s/ Thomas A.
    AndruskevichThomas
    A. Andruskevich |  | President, Chief Executive
    Officer and Director          |  | September 8, 2005
|                                                        
|*Lawrence
    Litowitz                                   |  | Principal Financial Officer and Principal Accounting Officer |  | September 8, 2005
|                                                        
|*Lorenzo
    Rossi di Montelera                          |  | Director                                                     |  | September 8, 2005
|                                                        
|*Shirley
    A. Dawe                                     |  | Director                                                     |  | September 8, 2005
|                                                        
|*Margherita
    Oberti                                   |  | Director                                                     |  | September 8, 2005
|                                                        
|*Peter
    R. OBrien                                    |  | Director                                                     |  | September 8, 2005
|                                                        
|*Filippo
    Recami                                      |  | Director                                                     |  | September 8, 2005
|                                                        
|*By:                                                     |  | /s/ Thomas A.
    AndruskevichAttorney-in-Fact               |  |                   |  | 




II-6



---



##### Table of Contents



AUTHORIZED REPRESENTATIVE












| |                           
| | --------------------------
| | HENRY BIRKS & SONS US INC.



| |     |                               
| | --- | ------------------------------
| | By: | /s/
    Thomas A. Andruskevich

| |                                       
| | --------------------------------------
| |                                       
| | Name:       Thomas A.
    Andruskevich

| |        |                                                
| | ------ | -----------------------------------------------
| | Title: | President, Chief Executive Officer and Director

II-7



---



##### Table of Contents



EXHIBIT INDEX





|        |    |                         |  |                                                                                                                                                                                                                                                                                                                                                                                                      
|------- | -- | ----------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                        
|Number  |    | Description of Document
|        |    |                        
|        | 2  | .1*                     |  | Agreement and Plan of Merger and Reorganization, dated as of
    April 18, 2005, as amended as of July 27, 2005, among
    Henry Birks & Sons Inc., Mayors Jewelers, Inc.
    and Birks Merger Corporation, a wholly-owned subsidiary of Henry
    Birks & Sons Inc. (attached as Appendix A to the proxy
    statement/prospectus which is part of this Registration
    Statement).               
|       
|        | 3  | .1*                     |  | Articles of Amalgamation of Henry Birks & Sons Inc.                                                                                                                                                                                                                                                                                                                                                  
|       
|        | 3  | .2*                     |  | Form of Articles of Amalgamation, as amended, of Henry
    Birks & Sons Inc. to be in effect upon consummation of
    the merger.                                                                                                                                                                                                                                                                    
|       
|        | 3  | .3*                     |  | By-laws of Henry Birks & Sons Inc.                                                                                                                                                                                                                                                                                                                                                                   
|       
|        | 3  | .4*                     |  | Form of By-laws of Henry Birks & Sons Inc., as amended,
    to be in effect upon consummation of the merger.                                                                                                                                                                                                                                                                                         
|       
|        | 4  | .1*                     |  | Form of Birks Class A voting share certificate.                                                                                                                                                                                                                                                                                                                                                      
|       
|        | 5  | .1**                    |  | Opinion of Stikeman Elliott LLP as to the legality of the
    securities being registered.                                                                                                                                                                                                                                                                                                           
|       
|        | 8  | .1**                    |  | Opinion of Holland & Knight LLP as to certain
    U.S. federal income tax matters.                                                                                                                                                                                                                                                                                                                   
|       
|        | 9  | .1*                     |  | Shareholders Agreement among Management Investors, Henry
    Birks & Sons Holdings Inc. and Birks, dated as of
    August 31, 1998, as amended as of April 5, 2002.                                                                                                                                                                                                                                 
|       
|        | 9  | .2*                     |  | Shareholders Agreement among Prime Investments SA, Henry
    Birks & Sons Holdings Inc., Marco Pasteris and Birks,
    dated as of August 15, 2002.                                                                                                                                                                                                                                                 
|       
|        | 10 | .1                      |  | Revolving Credit, Tranche B Loan and Security Agreement by
    and among Fleet Retail Finance Inc., GMAC Business Credit, LLC,
    Back Bay Capital Funding LLC and Mayors dated as of
    August 20, 2002. Incorporated by reference from
    Mayors Form 8-K dated as of August 20, 2002.                                                                                                        
|       
|        | 10 | .2                      |  | First Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    February 20, 2004, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 10-Q filed
    on January 7, 2005.   
|       
|        | 10 | .3                      |  | Second Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    November 21, 2003, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 10-Q filed
    on February 10, 2004.
|       
|        | 10 | .4                      |  | Third Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    February 20, 2004, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    March 4, 2004.      
|       
|        | 10 | .5                      |  | Fourth Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    September 7, 2004, by and among Fleet Retail Group, Inc.,
    GMAC Commercial Finance, LLC, Back Bay Capital Funding LLC, and
    the domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    September 13, 2004.
|       
|        | 10 | .6                      |  | Fifth Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    March 4, 2005, by and among Fleet Retail Group, Inc., GMAC
    Commercial Finance, LLC, Back Bay Capital Funding LLC, and the
    domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    March 8, 2005.          
|       
|        | 10 | .7                      |  | Sixth Amendment to Revolving Credit, Tranche B Loan and
    Security Agreement, Limited Waiver and Consent, dated as of
    March 4, 2005, by and among Fleet Retail Group, Inc., GMAC
    Commercial Finance, LLC, Back Bay Capital Funding LLC, and the
    domestic subsidiaries of Mayors and Mayors.
    Incorporated by reference from Mayors Form 8-K filed on
    May 5, 2005.            
|       
|        | 10 | .8                      |  | Exchange Agreement, dated as of February 20, 2004, between
    Mayors and Birks. Incorporated by reference from
    Mayors Form 8-K filed on March 4, 2004.                                                                                                                                                                                                                                        
|       
|        | 10 | .9                      |  | Management Consulting Services Agreement between Mayors
    and Regaluxe, dated as of April 22, 2004. Incorporated by
    reference from Mayors Form 8-K filed on April 29,
    2004.                                                                                                                                                                                                              
|       
|        | 10 | .10**                   |  | Accounts Receivable Management, Loan and Security Agreement
    among GMAC Commercial Finance Corporation Canada, Birks and
    Henry Birks & Sons U.S., Inc., dated as of
    October 15, 1996, amended and restated as of
    November 19, 2004, as amended as of July 21, 2005.                                                                                                                   






---



##### Table of Contents






|        |    |                         |  |                                                                                                                                                                                         
|------- | -- | ----------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                        
|Number  |    | Description of Document
|        |    |                        
|       
|        | 10 | .11*                    |  | Option Agreement between Birks, Henry Birks & Sons
    Holdings Inc. and GMAC Commercial Finance Corporation, dated as
    of March 15, 2005.                                           
|       
|        | 10 | .12*                    |  | Loan Agreement between Birks and Regaluxe dated as of
    February 16, 2004, and as amended as of February 23,
    2005.                                                                
|       
|        | 10 | .13*                    |  | Loan Agreement between Birks and la Financière du
    Québec, dated as of November 27, 2002.                                                                                            
|       
|        | 10 | .14*                    |  | Expense Reimbursement Agreement between Birks and Iniziativa SA,
    dated as of April 1, 2003.                                                                                         
|       
|        | 10 | .15*                    |  | Form of Directors and Officers Indemnity Agreement.                                                                                                                                     
|       
|        | 10 | .16*                    |  | Employee Stock Option Agreement, dated as of May 1, 1997,
    amended as of June 20, 2000.                                                                                              
|       
|        | 10 | .17*                    |  | Employment Agreement between Thomas A. Andruskevich and Birks,
    dated as of September 27, 2004.                                                                                      
|       
|        | 10 | .18*                    |  | Lease Agreement between Birks and Anglo Canadian Investments SA,
    dated as of December 12, 2000.                                                                                     
|       
|        | 10 | .19*                    |  | Diamond Supply Agreement between Prime Investments SA and Birks,
    dated as of August 15, 2002.                                                                                       
|       
|        | 10 | .20*                    |  | Conditional Sale Agreement between Rosy Blue N.V. and Birks,
    dated as of August 15, 2002.                                                                                           
|       
|        | 10 | .21*                    |  | Conditional Sale Agreement between Rosy Blue Inc. and Birks,
    dated as of August 15, 2002.                                                                                           
|       
|        | 10 | .22*                    |  | Conditional Sale Agreement between Rosy Blue Sales Ltd. and
    Birks, dated as of August 15, 2002.                                                                                     
|       
|        | 10 | .23*                    |  | Conditional Sale Agreement between Rosy Blue Hong Kong Ltd. and
    Birks, dated as of August 15, 2002.                                                                                 
|       
|        | 10 | .24*                    |  | Conditional Sale Agreement between Rosy Blue Finance S.A. and
    Birks, dated as of August 15, 2002.                                                                                   
|       
|        | 10 | .25*                    |  | Registration Rights Agreement between Birks and Prime
    Investments SA, dated as of February 4, 2005.                                                                                 
|       
|        | 10 | .26*                    |  | Secured convertible note between Prime Investments SA and Birks,
    dated as of September 30, 2002, as amended as of
    March 14, 2005.                                               
|       
|        | 10 | .27*                    |  | Offre de Garantie de Prêts between Garantie Québec and
    Birks, dated as of December 15, 1999 and April 9, 2001.                                                                      
|       
|        | 10 | .28*                    |  | Employment Agreement between Michael Rabinovitch and
    Mayors, dated as of August 1, 2005.                                                                                           
|       
|        | 10 | .29                     |  | Amended Employment Agreement between Thomas A. Andruskevich and
    Mayors, dated as of June 24, 2004. Incorporated by
    reference from Mayors Form 10-K filed on
    June 25, 2004.
|       
|        | 10 | .30                     |  | Amended Employment Agreement between Albert Rahm II and
    Mayors, dated as of July 19, 2002. Incorporated by
    reference from Mayors Form 10-Q filed
    December 17, 2002.       
|       
|        | 10 | .31                     |  | Amended Employment Agreement between Aida Alvarez and
    Mayors, dated as of July 19, 2002. Incorporated by
    reference from Mayors Form 10-Q filed
    December 17, 2002.         
|       
|        | 10 | .32                     |  | Employment Agreement between Marc Weinstein and Mayors,
    dated as of October 26, 2001. Incorporated by reference
    from Mayors Form 10-Q filed on December 18, 2001.             
|       
|        | 10 | .33                     |  | Amended Employment Agreement between Marc Weinstein and
    Mayors, dated as of July 19, 2002. Incorporated by
    reference from Mayors Form 10-Q filed
    December 17, 2002.       
|       
|        | 10 | .34                     |  | Second Amendment to Employment Agreement between Marc Weinstein
    and Mayors, dated March 31, 2003. Incorporated by
    reference from Mayors Form 10-K filed on
    June 19, 2003. 
|       
|        | 10 | .35                     |  | Employment Agreement between Joseph Keifer III and
    Mayors, dated October 1, 2002. Incorporated by
    reference from Mayors Form 10-Q filed on
    December 17, 2002.             
|       
|        | 13 | .1                      |  | Mayors Annual Report on Form 10-K for the year ended
    March 26, 2005, filed on June 24, 2005.                                                                                       
|       
|        | 21 | .1*                     |  | Subsidiaries of Henry Birks & Sons Inc.                                                                                                                                                 
|       
|        | 23 | .1**                    |  | Consent of KPMG LLP.                                                                                                                                                                    
|       
|        | 23 | .2**                    |  | Consent of KPMG LLP.                                                                                                                                                                    
|       
|        | 23 | .3**                    |  | Consent of Deloitte & Touche LLP.                                                                                                                                                       
|       
|        | 23 | .4**                    |  | Consent of Stikeman Elliott LLP (included in Exhibit 5.1).                                                                                                                              
|       
|        | 23 | .5**                    |  | Consent of Holland & Knight LLP (included in
    Exhibit 8.1).                                                                                                                          
|       
|        | 23 | .6**                    |  | Consent of Houlihan Lokey Howard & Zukin.                                                                                                                                               
|       
|        | 24 | .1*                     |  | Powers of Attorney.                                                                                                                                                                     
|       
|        | 99 | .1*                     |  | Form of proxy card for the special and annual meeting of
    stockholders of Mayors Jewelers, Inc.                                                                                     






---



##### Table of Contents



|        |    |                         |  |                                                                                                                                                                                           
|------- | -- | ----------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |                        
|Number  |    | Description of Document
|        |    |                        
|       
|        | 99 | .2*                     |  | Form of Letter to the stockholders of Mayors Jewelers,
    Inc. (included in the proxy statement/ prospectus which is part
    of this Registration Statement).                          
|       
|        | 99 | .3*                     |  | Form of Notice of Special and Annual Meeting of stockholders of
    Mayors Jewelers, Inc. (included in the proxy statement/
    prospectus which is part of this Registration Statement).
|       
|        | 99 | .4*                     |  | Opinion of Houlihan Lokey Howard & Zukin (attached as
    Appendix B to the proxy statement/ prospectus which is part of
    this Registration Statement).                                









|  |                  
|- | -----------------
|* | Previously filed.









|   |                
|-- | ---------------
|** | Filed herewith.