TROPICAL SPORTSWEAR INT'L CORPORATION
4902 W. WATERS AVENUE
TAMPA, FLORIDA 33634-1302
December 22, 2000
Dear Shareholder:
You are cordially invited to attend the 2001 Annual Meeting of
Shareholders of Tropical Sportswear Int'l Corporation (the "Company") which will
be held at the offices of the Company, 4902 W. Waters Avenue, Tampa, Florida, on
Tuesday, January 23, 2001 at 10:00 a.m. local time.
We look forward to your attendance at the Annual Meeting so that you can
learn more about your Company and become better acquainted with members of the
Board of Directors and management team. The items of business which are being
presented for a vote by the holders of Common Stock at the Annual Meeting are
(i) the election of three directors of the Company; and (ii) ratification of the
selection of the Company's auditor for the fiscal year ending September 29,
2001, all as explained in the accompanying Proxy Statement. Even if you are
planning to attend, please complete the enclosed proxy card and return it in the
enclosed envelope to cast your vote. You will still be able to revoke your proxy
and vote your shares in person at the Annual Meeting if you so desire.
If you have any questions about the Proxy Statement or the accompanying
2000 Annual Report, please contact Mr. Michael Kagan at (813) 249-4900.
Sincerely,
/s/ William W. Compton
William W. Compton
Chairman of the Board of Directors
TROPICAL SPORTSWEAR INT'L CORPORATION
4902 W. WATERS AVENUE
TAMPA, FLORIDA 33634-1302
NOTICE TO THE HOLDERS OF COMMON STOCK
OF THE ANNUAL MEETING OF SHAREHOLDERS
to be held on January 23, 2001
Notice is hereby given to the holders of the common stock, $.01 par
value per share (the "Common Stock"), of Tropical Sportswear Int'l Corporation
(the "Company") that the 2001 Annual Meeting of Shareholders of the Company
(including any postponements or adjournments thereof, the "Annual Meeting") will
be held at the offices of the Company, 4902 W. Waters Avenue, Tampa, Florida
33634-1302, on Tuesday, January 23, 2001, at 10:00 a.m., local time, for the
following purposes:
(i) To elect three directors to serve until the 2004 Annual Meeting
of Shareholders;
(ii) To ratify the selection of Ernst & Young LLP as the Company's
independent certified public accountants for the fiscal year
ending September 29, 2001 and
(iii) To transact such other business as may properly come before the
Annual Meeting.
Information relating to the Annual Meeting and the election of
directors is set forth in the attached Proxy Statement.
Only those shareholders of record at the close of business on December
12, 2000, are entitled to notice of and to vote at the Annual Meeting. A
complete list of shareholders entitled to vote at the Annual Meeting will be
available for examination by any shareholder at the Annual Meeting and for a
period of ten days prior thereto at the executive offices of the Company in
Tampa, Florida.
By Order of the Board of Directors,
/s/ Michael Kagan
Michael Kagan
December 22, 2000 Secretary
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE VOTE,
SIGN, DATE, AND RETURN THE ENCLOSED PROXY PROMPTLY IN THE ENCLOSED BUSINESS
REPLY ENVELOPE. IF YOU ATTEND THE ANNUAL MEETING YOU MAY, IF YOU WISH, WITHDRAW
YOUR PROXY APPOINTMENT AND VOTE IN PERSON.
TROPICAL SPORTSWEAR INT'L CORPORATION
4902 W. WATERS AVENUE
TAMPA, FLORIDA 33634-1302
December 22, 2000
Proxy Statement
For Holders of Common Stock
For Annual Meeting of Shareholders
to be Held on January 23, 2001
INTRODUCTION
This Proxy Statement is furnished to holders of the common stock, $.01
par value per share ("Common Stock"), of Tropical Sportswear Int'l Corporation,
a Florida corporation (the "Company"), in connection with the solicitation of
proxies by the Company's Board of Directors from holders of the outstanding
shares of Common Stock for use at the 2001 Annual Meeting of Shareholders to be
held at 10:00 a.m. local time at the office of the Company, 4902 W. Waters
Avenue, Tampa, Florida 33634-1302, on Tuesday, January 23, 2001 (including any
postponements or adjournments thereof, the "Annual Meeting").
The Annual Meeting will be held for the following purposes:
(i) To elect three directors to serve until the 2004 Annual Meeting of
Shareholders;
(ii) To ratify the selection of Ernst & Young LLP as the Company's
independent certified public accountants for the fiscal year
ending September 29, 2001; and
(iii) To transact such other business as may properly come before the
Annual Meeting.
This Proxy Statement and the accompanying Proxy are first being mailed to
shareholders of the Company on or about December 22, 2000.
Shareholders Entitled to Vote
Only shareholders of record of the Company at the close of business on
December 12, 2000 (the "Record Date") will be entitled to notice of, and to vote
at, the Annual Meeting. Each share of Common Stock is entitled to one vote. On
the Record Date, there were 7,637,727 shares of Common Stock issued and
outstanding held by approximately 75 shareholders of record. Notwithstanding the
Record Date specified above, the Company's stock transfer books will not be
closed and shares may be transferred subsequent to the Record Date. However, all
votes must be cast in the names of shareholders of record on the Record Date.
Quorum and Voting Requirements
The holders of record of a majority of the votes of Common Stock entitled
to be cast at the Annual Meeting, present in person or by proxy, are required to
establish a quorum for the Annual Meeting and for voting on each matter. For the
purpose of determining the presence of a quorum, abstentions and votes withheld
from any nominee will be considered to be "votes entitled to be cast" and
therefore will be counted as present for purposes of determining the presence or
absence of a quorum. Broker non-votes will not be considered to be "votes
entitled to be cast" and will not be counted as present for quorum purposes.
Broker non-votes are votes that brokers holding shares of record for their
customers are not permitted to cast under applicable stock exchange rules
because the brokers have not received specific instructions from their customers
as to certain proposals and as to which the brokers advised the Company that
they lack voting authority. Although there are no controlling precedents under
Florida law regarding the treatment of broker non-votes, the Company intends to
apply the principles set for herein.
Proposal I: Election of Directors. The election of three directors by
the holders of Common Stock will require a plurality of the votes cast by the
shares of Common Stock represented and entitled to vote in the election at the
Annual Meeting. With respect to the election of directors, shareholders may (i)
vote "for" each of the nominees, (ii) withhold authority for each of such
nominees, or (iii) withhold authority for specific nominees but vote for the
other nominees. Because the directors are elected by a plurality of the votes
cast by the shares represented and entitled to vote, an abstention from voting
or a broker non-vote will have no effect on the outcome of the election of
directors.
Proposals II: Ratification of Auditors. The ratification of Ernst &
Young LLP as the Company's independent certified public accountants will require
that the votes cast by the shares of Common Stock represented and entitled to
vote at the Annual Meeting in favor of the proposal exceed the votes against the
proposal. With respect to this proposal, shareholders may (i) vote "for" the
proposal, (ii) vote "against" the proposal, or (iii) abstain from voting. An
abstention or a broker non-vote will have no effect on the outcome of this
proposal.
Proxies
If the enclosed Proxy is executed, returned in time and not revoked, the
shares represented thereby will be voted in accordance with the instructions
indicated in such Proxy. IF NO INSTRUCTIONS ARE INDICATED, PROXIES WILL BE VOTED
FOR (I) THE ELECTION OF ALL DIRECTOR NOMINEES, AND (II) THE RATIFICATION OF
ERNST & YOUNG LLP AS THE COMPANY'S INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS FOR
THE FISCAL YEAR ENDING SEPTEMBER 29, 2001.
The Board of Directors is not aware of any other business to be
presented to a vote of the shareholders at the Annual Meeting. As permitted by
Rule 14a-4(c) of the Securities and Exchange Commission (the "Commission"), the
persons named as proxies on the proxy cards will have discretionary authority to
vote in their judgment on any proposals presented by shareholders for
consideration at the Annual Meeting that were submitted to the Company after
November 23, 2000. Such proxies also will have discretionary authority to vote
in their judgment upon the election of any person as a director if a director
nominee named in Proposal I is unable to serve for good cause or will not serve,
and on matters incident to the conduct of the Annual Meeting.
A shareholder who has given a Proxy may revoke it at any time prior to its
exercise at the Annual Meeting by either (i) giving written notice of revocation
to the Secretary of the Company, (ii) properly submitting to the Company a duly
executed Proxy bearing a later date, or (iii) appearing at the Annual Meeting
and voting in person. All written notices of revocation of Proxies should be
addressed as follows: Tropical Sportswear Int'l Corporation, 4902 W. Waters
Avenue, Tampa, Florida 33634-1302, Attention: Mr. Michael Kagan, Secretary.
PROPOSAL I
ELECTION OF DIRECTORS
The Company's Board of Directors is divided into three classes each
consisting of three members, with each class serving three-year terms expiring
at the third annual meeting of shareholders after their elections. The Board of
Directors has nominated three members to serve as Class III directors of the
Company for a three-year term ending 2004, and until each of their respective
successors is duly elected and qualified.
In the event any of the nominees to Class III is unable to serve, the
person designated as proxy will cast in their discretion, votes for such other
person named in their discretion as a substitute nominee. The Board of Directors
has no reason to believe that the nominees named below will be unavailable, or
if elected, will decline to serve.
Pursuant to the Company's Amended and Restated Articles of
Incorporation (the "Articles"), Accel, S.A. de C.V. ("Accel") currently has the
right to nominate two persons to stand for election to the Company's Board of
Directors. In addition, the Articles also grant each of William W. Compton,
Chairman of the Board and Chief Executive Officer of the Company, and Michael
Kagan, Vice Chairman of the Board, Executive Vice President, Chief Financial
Officer and Secretary of the Company, the right to nominate one person to stand
for election to the Company's Board of Directors. Moreover, pursuant to a
shareholders' agreement among Accel and Messrs. Compton and Kagan and their
respective family limited partnerships, all shares of Common Stock owned or
controlled by such persons or entities will be voted in favor of the election of
the persons nominated by such persons and entities pursuant to their rights
under the Articles. Mr. Kagan has been nominated pursuant to these provisions.
He will receive the favorable votes of Accel and Messrs. Compton and Kagan and
their respective family limited partnerships.
The Board of Directors recommends that the shareholders vote FOR each
Director nominee. If a choice is specified on the Proxy by the shareholder, the
shares will be voted as specified. If no specification is made, the shares will
be voted FOR the Director nominees. Election of each Director nominee will
require the affirmative vote of a plurality of the votes cast by shares of
Common Stock represented and entitled to vote at the Annual Meeting.
The following paragraphs set forth the names of the Directors of the
Company, their ages, their positions with the Company, and their principal
occupations and employers for at least the last five years. For information
concerning directors' ownership of Common Stock, see "Stock Ownership."
Nominees for Director - Term to Expire in 2004
The Board of Directors has nominated the following individuals for election
by the holders of Common Stock as directors of the Company:
Michael Kagan. Mr. Kagan, age 61, has served as Executive Vice President,
Chief Financial Officer, Secretary and Vice Chairman of the Board of the Company
since November 1989. He was also Treasurer of the Company from November 1989 to
January 1998. Mr. Kagan has more than 30 years experience in the apparel
industry. Prior to joining the Company, Mr. Kagan served as Senior Vice
President of Finance for Munsingwear, Inc. and as Executive Vice President and
Chief Operating Officer of Flexnit Company, Inc., a manufacturer of women's
intimate apparel.
Leon H. Reinhart. Mr. Reinhart, age 58, has served as a Director of the
Company since August 1997. Mr. Reinhart has been president, Chief Executive
Officer and a director of First National Bank based in San Diego, California,
since May 1996. Prior to such time, Mr. Reinhart's experience includes
twenty-eight years as an executive with Citibank, N.A., and its affiliates in a
variety of domestic and international positions. Mr. Reinhart also serves as a
Director on the Boards of Shop-A-Z.com, Elamex, S.A., San Diego Dialogue and the
International Community Foundation.
Charles J. Smith. Mr. Smith, age 73, became a director of the Company in
June 1998. Previously he had been director of Farah since March 1994. For more
than five years prior to his retirement in 1994, Mr. Smith served in various
capacities with Crystal Brands, Inc., an apparel manufacturer and marketer, most
recently as an Executive Vice President. Since then, Mr. Smith has served as a
consultant to various apparel companies. In May 1995, Mr. Smith became a partner
in and director of Phoenix Apparel Group, Inc., a privately-held apparel
sourcing and consulting company.
Directors Continuing in Office - Term to Expire in 2003
Jesus Alvarez-Morodo. Mr. Alvarez-Morodo, age 54, has served as a Director
of the Company and its predecessors since November 1989. He has been Vice
Chairman of the Board of Directors of Elamex S.A. de C.V. ("Elamex"), a
manufacturing company controlled by Accel since 1995 and a Director of Elamex
since 1990. Accel is a publicly traded Mexican holding company having
subsidiaries engaged in warehousing, distribution and manufacturing. He has been
President and Chief Executive Officer of Accel since 1992 and has held various
positions with Accel and its predecessor, Grupo Chihuahua, S.A. de C.V. ("Grupo
Chihuahua"), and its subsidiaries since 1982, including Vice President from 1989
to 1992 and Vice Chairman since 1999.
William W. Compton. Mr. Compton, age 57, has served as Chairman of the
Board and Chief Executive Officer of the Company and its predecessors since
November 1989. He also served as President of the Company and its predecessors
from November 1989 to November 1994. Mr. Compton has over 30 years of experience
in the apparel industry. Mr. Compton also serves as Chairman of the Directors of
the American Apparel Manufacturers Association and is a member of its Executive
Committee. He is also a member of the Board of Directors for the Center for
Entrepreneurship for Brigham Young University. Prior to joining the Company, he
served as President and Chief Operating Officer of Munsingwear, Inc., an apparel
manufacturer and marketer, President/Executive Vice President of Corporate
Marketing for five apparel divisions of McGregor/Faberge Corporation and
President, U.S.A. and as a Director of Farah.
Directors Continuing in Office - Term to Expire in 2002
Leslie J. Gillock. Ms. Gillock, age 44, has served as a Director of the
Company since August 1997. Ms. Gillock has served as Vice President Brand
Management of Springs Industries, Inc. since October 1999. Previously, she
served in various capacities with Fruit of the Loom, Inc. from 1978 until June
1998, including Vice President of Marketing between March 1995 and June 1998,
Director of Marketing from January 1993 through February 1995, and Marketing
Manager for Intimate Apparel from January 1989 through December 1992. She has
over 20 years experience in the apparel industry.
Donald H. Livingstone. Mr. Livingstone, age 58, has served as a Director of
the Company since August 1997. He also has served as a Trustee of the Eureka
Family of Mutual Funds since August 1997, and as a Director of California
Independent Bankcorp since October 1998. He has been a Teaching Professor at the
Brigham Young University Marriott School of Management and the Director of its
Center for Entrepreneurship since September 1994. From 1976 through March 1995,
he was a partner with Arthur Andersen LLP. He joined Arthur Andersen LLP in
1966.
Eloy S. Vallina-Laguera. Mr. Vallina-Laguera, age 63, has served as a
Director of the Company and its predecessors since November 1989. He has been
Chairman of the Board of Accel and its predecessor, Grupo Chihuahua, since its
inception in 1979. Mr. Vallina-Laguera has been Chairman of the Board of Elamex
since 1990. Mr. Vallina-Laguera was Chairman of Banco Commercial Mexicano, later
Multibanco Comermex, one of Mexico's largest commercial banks at that time, from
1971 until its expropriation in 1982.
Meetings of the Board of Directors and Committees
Board of Directors. The property, affairs and business of the Company are
under the general management of its Board of Directors as provided by the laws
of Florida and the Bylaws of the Company. The Board of Directors conducts its
business through meetings of the full Board and through committees of the Board,
and the Board of Directors has appointed standing Audit, Compensation,
Information Technology, Stock Option and Executive Committees of the Board of
Directors.
The Board of Directors as a whole functions as the nominating committee to
select nominees for election as directors of the Company. The Board of Directors
will consider those nominees submitted by holders of Common Stock if submitted
to the Company on or before August 24, 2001. See "Shareholder Proposals for 2001
Annual Meeting of Shareholders."
The Board of Directors held seven meetings during the fiscal year ending
September 30, 2000 ("Fiscal 2000"). Each director attended or acted upon at
least 75% of the aggregate number of Board of Director meetings, or consents,
including Board of Director Committee meetings or consents held or acted upon
during fiscal year 2000.
Audit Committee. The Audit Committee consists of Messrs. Alvarez-Morodo,
Livingstone and Smith and Ms. Gillock. The Audit Committee met five times in
Fiscal 2000. The Audit Committee is responsible for reviewing the independence,
qualifications and activities of the Company's independent certified public
accountants and the Company's financial policies, control procedures and
accounting staff. The Audit Committee recommends to the Board the appointment of
the independent certified public accountants and reviews and approves the
Company's financial statements. The Audit Committee is also responsible for the
review of transactions between the Company and any Company officer, director or
entity in which a Company officer or director has a material interest.
Compensation Committee. The Compensation Committee consisted of Richard C.
Allender, and Messrs. Compton, Reinhart and Vallina-Laguera and Ms. Gillock
until December 31, 1999 when Mr. Allender resigned from the Board or Directors.
On April 25, 2000, Mr. Vallina-Laguera resigned from the Committee. After April
25, 2000, the Committee consisted of Messrs. Compton, Reinhart and Smith and Ms.
Gillock. The Committee met twice in Fiscal 2000. The Compensation Committee is
responsible for establishing the compensation of the Company's directors and
executive officers, including salaries, bonuses, termination arrangements, and
other executive officer benefits.
Information Technology Committee. The Information Technology Committee
consists of Messrs. Alvarez-Morodo, Livingstone and Smith. The Committee met
three times in Fiscal 2000. The Information Technology Committee was formed in
December 1999 to provide oversight of the implementation of the Company's new
Enterprise 2000 software systems.
Stock Option Committee. The Stock Option Committee consisted of Ms. Gillock
and Messrs. Reinhart and Vallina-Laguera until April 25, 2000, when Mr.
Vallina-Laguera resigned from the Committee. After April 25, 2000, the Stock
Option Committee consisted of Ms. Gillock and Messrs. Reinhart and Smith. The
Stock Option Committee met or unanimously consented to resolutions seven times
in Fiscal 2000. The Stock Option Committee is responsible for the administration
of the Company's various stock option plans, including designating the
recipients, amounts and terms of stock option grants thereunder.
Executive Committee. The Executive Committee consists of Messrs.
Alvarez-Morodo, Compton, Kagan, Livingstone and Vallina-Laguera. The Executive
Committee is responsible for performing all tasks of the Board of Directors on
behalf of the Board between meetings of the Board to the extent permitted by the
Company's Bylaws and Florida law.
Compensation of Directors
Directors who are executive officers of the Company receive no
compensation as such for service as members of either the Board of Directors or
committees thereof. Directors who are not executive officers of the Company
received $1,500 per Board and/or committee meeting attended thereafter, plus
reimbursement of reasonable expenses. The outside directors are also eligible to
receive options to purchase Common Stock under the Company's Non-Employee
Director Stock Option Plan.
Executive Compensation
Summary Compensation Information. The following table presents certain
summary information concerning compensation paid or accrued by the Company for
services rendered in all capacities during the fiscal years ended September 30,
2000, October 2, 1999 and October 3, 1998 for (i) the Chief Executive Officer of
the Company; and (ii) each of the four other most highly compensated executive
officers of the Company whose total salary and bonus for the fiscal year ended
September 30, 2000, exceeded $100,000 (collectively, the "Named Executive
Officers").
Long Term
Compensation
Awards
Annual Compensation ---------------
------------------- Securities
Name and Underlying All Other
Principal Position Year Salary Bonus Options/SARs Compensation
------------------ ---- ------ ------ ------------ ------------
William W. Compton 2000 $ 600,000 $ 833,000 43,000 $ 20,637 (1)
Chairman of the Board and 1999 550,000 250,000 72,100 17,679 (1)
Chief Executive Officer 1998 434,096 493,350 104,400 9,822 (1)(2)
Richard J. Domino 2000 $ 360,000 $ 360,500 24,000 $ 7,695 (3)
President 1999 325,000 -- 40,000 7,695 (3)
1998 254,848 258,750 35,300 --
Michael R Mitchell 2000 $ 360,000 $ 358,400 24,000 $ 3,570 (4)
President 1999 320,000 200,000 45,000 4,391 (4)
Savane International Corp. 1998 300,000 100,000 10,000 563,243 (4)
Michael Kagan 2000 $ 330,000 $ 268,600 31,000 $ 29,158 (5)
Vice Chairman of the Board, 1999 300,000 100,000 50,000 29,158 (5)
Executive Vice President 1998 239,178 197,800 61,100 5,260 (2)(5)
and Chief Financial Officer
Gregory L. Williams (6) 2000 $ 305,000 $ 258,600 20,000 $ --
Executive Vice President 1999 71,538 -- 15,000 --
and General Counsel
---------------------------------
(1) Includes $4,167 in director's fees for fiscal 1998, $20,637, $17,679
and $5,655 in grossed-up premiums for term life insurance for fiscal
2000, 1999 and 1998, respectively, for the benefit of Mr. Compton and
his family.
(2) Following the Company's initial public offering in October 1997,
directors who are executive officers of the Company were no longer
eligible to receive compensation for services as members of either the
Board of Directors or committees thereof.
(3) Includes $7,695 in grossed-up premiums for term life insurance policies
for fiscal 2000 and 1999, for the benefit of Mr. Domino and his family.
(4) Includes $3,570, $2,843 and $2,132 in grossed-up premiums for term life
insurance policies for fiscal 2000, 1999 and 1998, respectively, for
the benefit of Mr. Mitchell and his family; and $1,548 for split dollar
life insurance policies for each of fiscal 1999 and 1998, and $559,563
in a cash payout for Farah Incorporated common stock in 1998 related to
the merger of the Company and Farah Incorporated.
(5) Includes $2,500 in director's fees for fiscal 1998, $29,158, $29,158,
and $2,760 in grossed-up premiums for term life insurance for fiscal
2000, 1999 and 1998, respectively, for the benefit of Mr. Kagan and his
family.
(6) Mr. Williams commenced serving as a Named Executive Officer in Fiscal
2000 and joined the Company in 1999.
Option Grants in Last Fiscal Year
Individual Grant
----------------------------------------------------------------------
Number of Percent of Potential Realizable Value at
Securities Total Options Assumed Annual Rates of
Underlying Granted to Exercise Stock Price Appreciation
Options Employees in Or Expiration for Option Term
Name Granted Fiscal Year Base Price Date 5% 10%
---- ------- ----------- ---------- ---------- ----- ------
William W. Compton 43,000 5.6% $17.3125 8/1/2010 $468,173 $1,186,442
Richard J Domino 24,000 3.1% $17.3125 8/1/2010 261,306 662,200
Michael R. Mitchell 24,000 3.1% $17.3125 8/1/2010 261,306 662,200
Michael Kagan 31,000 4.0% $17.3125 8/1/2010 337,520 855,342
Gregory L. Williams 20,000 2.6% $17.3125 8/1/2010 217,755 551,833
Fiscal Year-End Option Values
-------------------------------------------------------------------
Value of Unexercised
Number of Securities Underlying In-the-Money
Unexercised Options Options
Name At Fiscal Year-End At Fiscal Year-End (1)
------------------ ------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
William W. Compton 188,200 54,800 $392,555 $132,240
Richard J. Domino 68,868 38,432 170,503 60,497
Michael R. Mitchell 45,667 33,333 1,875 3,749
Michael Kagan 118,868 37,032 296,495 101,830
Gregory L. Williams 35,000 -- 938 --
---------------------------------
(1) Represents the fair market value of a share of Common Stock as of
September 29, 2000 of $17.00, less the option exercise price,
multiplied by the total number of exercisable or unexercisable options.
Employment Arrangements.
The Company has employment agreements with each of Messrs. Compton,
Kagan and Domino, which became effective as of the completion of the initial
public offering in October 1997. The Company also has an employment agreement
with Mr. Mitchell, which became effective at the time of the merger of the
Company and Farah Incorporated, and an employment agreement with Mr. Williams,
which became effective on his date of employment.
William W. Compton. The employment agreement with Mr. Compton provides
for an initial term ending in 2002, with automatic renewals beginning at the end
of the third year such that there shall remain at all times thereafter a rolling
two-year term of employment. Notwithstanding the foregoing, in the event the
agreement has not otherwise been terminated, it will terminate automatically at
the end of the Company's fiscal year in which Mr. Compton reaches age 65. The
agreement provides for an annual base salary (currently $750,000) subject to a
minimum annual increase equal to the increase in the Consumer Price Index for
all Urban Consumers - All Items Index for Tampa, Florida ("CPI") for the
immediately preceding twelve months. By contract, Mr. Compton is also entitled
to an annual performance bonus of up to 110% of his base salary based on a
comparison of the Company's average return on total capital employed over a
four-year period as compared to an average target return on total capital as
calculated for a select group of publicly traded apparel companies over the same
period. To the extent authorized by the Company's Board of Directors, Mr.
Compton also shall be entitled to participate in such bonus programs and other
benefit plans as are generally made available to other executive officers of the
Company.
If the agreement is terminated by the Company on or after January 1,
1999, for any reason other than cause or Mr. Compton's death or disability, the
Company shall pay Mr. Compton a one-time, lump sum severance payment equal to
the product of (i) the greater of two and the number of years (rounded to the
nearest 1/12 of a year) remaining in the initial five-year term and (ii) the sum
of Mr. Compton's average annual base salary and average annual bonus for the
preceding three years. During the two-year period following termination of
employment other than as a result of disability, Mr. Compton shall not engage in
or have any impermissible financial interest in any business that is engaged in
the merchandising, manufacturing, distribution or marketing of men's casual
pants, shorts or jeans.
Mr. Compton's agreement also provides for a one-time, lump sum
severance payment, in lieu of any other severance payment, if Mr. Compton elects
to terminate his employment with the Company either for "good reason" (as
defined therein) or upon a "change of control" of the Company. Upon termination
for "good reason," the severance payment will equal the product of (i) the
greater of two and the number of years (rounded to the nearest 1/12 of a year)
remaining in the initial five-year term and (ii) the sum of Mr. Compton's
average annual base salary and average annual bonus for the preceding three
years. Upon termination upon a "change of control," the severance payment will
equal, depending on the extent of the change of control, either (a) two times
Mr. Compton's average annual base salary for the preceding three years, or (b)
two times the sum of Mr. Compton's average annual base salary and average annual
bonus for the preceding three years. Under the agreement, a "change of control"
shall be deemed to have occurred if (i) any person (other than certain exempt
persons, including Messrs. Compton and Kagan, Accel, the Company and their
respective affiliates and associates) beneficially owns 25% (or, in certain
cases, 33%) or more of the outstanding shares of voting capital stock, or (ii)
immediately following the sale or transfer of substantially all of the Company's
assets, or the merger or consolidation of the Company with or into another
person, any person (other than certain except persons) shall beneficially own
25% (or, in certain cases, 33%) or more of the surviving or acquiring person.
Michael Kagan. The Company's employment agreement with Mr. Kagan is
substantially the same as its employment agreement with Mr. Compton's except
that Mr. Kagan's current annual base salary is $365,000 and by contract, his
maximum annual performance bonus equals 80% of his base salary.
Richard J. Domino. The Company's employment agreement with Mr. Domino
provides for an initial term ending in 2000, with automatic renewals beginning
at the end of the second year such that there shall remain at all times
thereunder a rolling one-year term of employment. Notwithstanding the foregoing,
in the event the agreement has not been otherwise terminated, it will terminate
automatically at the end of the Company's fiscal year in which Mr. Domino
reaches age 65. The agreement provides for an annual base salary (currently
$385,000) subject to a minimum annual increase equal to the increase in the CPI
for the immediately preceding twelve months. By contract, Mr. Domino is also
entitled to an annual performance bonus of up to 100% of his base salary.
The agreement provides that, if Mr. Domino's employment is terminated
without cause (as defined therein) by the Company, he shall be entitled to
severance payments, payable biweekly, at his annual base salary rate at the time
of termination until the end of the remaining term under the employment
agreement. The agreement further provides that, if Mr. Domino is terminated by
the Company for cause, Mr. Domino will not be entitled to any separation
benefits and Mr. Domino's salary, bonus, benefits and business expense
reimbursements shall cease as of the date of termination, except that payments
due to Mr. Domino and not paid up to the date of such termination will be paid
to Mr. Domino within forty-five (45) days of such termination.
Michael R. Mitchell. The Company's employment agreement with Mr.
Mitchell provides for an initial term ending in 2000, with automatic renewals
beginning at the end of the second year such that there shall remain at all
times thereunder a rolling one-year term of employment. Notwithstanding the
foregoing, in the event the agreement has not been otherwise terminated, it will
terminate automatically when Mr. Mitchell reaches age 65. The agreement provides
for an annual base salary (currently $385,000).
The agreement provides that, if Mr. Mitchell's employment is terminated
without cause (as defined therein) by the Company, he shall be entitled to
severance payments consisting of his base salary rate at the time of termination
until the end of the remaining term under the employment agreement, any bonus
accrued and certain benefits. The agreement further provides that, if Mr.
Mitchell is terminated by the Company for cause, Mr. Mitchell will not be
entitled to any separation benefits and Mr. Mitchell's salary, bonus, benefits
and business expense reimbursements shall cease as of the date of termination.
By contract, Mr. Mitchell is also entitled to an annual performance bonus of up
to 100% of his base salary.
Gregory L. Williams. The Company's employment agreement with Mr.
Williams provides for an initial term ending in 2002, automatically renewing
each day thereafter, intending that there shall be a continuously remaining term
of twenty-four months of Mr. Williams' employment. Notwithstanding the
foregoing, in the event the agreement has not been otherwise terminated, it will
terminate automatically at the end of the Company's fiscal year in which Mr.
Williams reaches age 65. The agreement provides for an annual base salary
(currently $365,000) subject to a minimum annual increase equal to the increase
in the CPI for the immediately preceding twelve months. By contract, Mr.
Williams is also entitled to an annual performance bonus of up to 80% of his
base salary.
The agreement provides that, if Mr. Williams' employment is terminated
for a business reason (as defined therein) by the Company, he shall be entitled
to severance payments, at his average annual compensation at the time of
termination until the end of the remaining term under the employment agreement.
The agreement further provides that, if Mr. Williams is terminated by the
Company for cause, Mr. Williams will not be entitled to any separation benefits
and Mr. Williams' salary, bonus, benefits and business expense reimbursements
shall cease as of the date of termination, except that payments due to Mr.
Williams and not paid up to the date of such termination will be paid to Mr.
Williams within thirty (30) days of such termination. If Mr. Williams terminates
his employment for good reason (as defined therein) he will be entitled to a
payment equal to his average annual compensation multiplied by two.
Compensation Committee Report on Executive Compensation.
Introduction. Under the rules of the Commission, the Company is
required to provide certain information concerning compensation of the Company's
chief executive officer, and the Named Executive Officers (Messrs. Compton,
Domino, Kagan, Mitchell and Williams) for Fiscal 2000. . The disclosure
requirements include a report of the committee responsible for compensation
decisions for the Named Executive Officers, explaining the rationale and
considerations that led to those compensation decisions.
Compensation Committee Role. The Compensation Committee and the Stock
Option Committee currently are responsible for separate aspects of the Company's
compensation program for its executive officers, including the Named Executive
Officers. The Compensation Committee is responsible for establishing the
compensation of the Company's directors and officers, including salaries,
bonuses, termination arrangements and other executive officer benefits. The
Stock Option Committee is responsible for the administration of the Employee
Plan, the 2000 Plan, and the 1996 Plan, including the recipients, amounts and
terms of stock option grants thereunder.
Compensation Philosophy. The compensation philosophy for executive
officers conforms generally to the compensation philosophy followed for all of
the Company's employees. The Company's compensation is designed to maintain
executive compensation programs and policies that enable the Company to attract
and retain the services of highly qualified executives at a compensation level
commensurate with their skill and experience. In addition to base salaries,
executive compensation programs and policies consisting of performance-based and
discretionary cash bonuses and periodic grants of stock options are designed to
reward and provide incentives for individual contributions as well as overall
Company performance.
The Compensation Committee monitors the operation of the Company's
executive compensation policies. Key elements of the Company's compensation
program consists of base salary, annual cash bonuses and periodic grants of
stock options (which the Stock Option Committee administers). The Company's
policies with respect to these elements, including the basis for the
compensation awarded the Company's chief executive officer, are discussed below.
While the elements of compensation described below are considered separately,
the Board of Directors and the Compensation Committee take into account the full
compensation package offered by the Company to the individual, including health
care and other insurance benefits.
Base Salaries. The Company has established competitive annual base
salaries for all officers, including the Named Executive Officers. Effective as
of the initial public offering, the Company entered into new employment
agreements with each of its executive officers. The employment agreement for
each of Messrs. Compton and Kagan provides for an initial term of five years,
with automatic renewals. The employment agreement for Mr. Domino provides for an
initial term of three years, with automatic renewals. The employment agreement
with Mr. Mitchell provides for an initial term of two years, with automatic
renewals. See "Executive Compensation-Employment Agreements." The annual base
salaries for each of the Company's executive officers, including the Company's
chief executive officer, reflect the subjective judgment of the Compensation
Committee based on the consideration of the executive officer's position and
tenure with the Company, the Company's needs, and the executive officer's
individual performance, achievements and contributions to the growth of the
Company, and empirical data establishing compensation levels for other
comparable positions in the industry. The minimum annual percentage increase in
base salary under each of the foregoing employment agreements, except for Mr.
Mitchell's, is the percentage increase in the CPI.
Mr. Compton's annual base salary as the Company's chief executive
officer was $600,000 for Fiscal 2000. The Board of Directors and the
Compensation Committee believe that this annual base salary is consistent with
the salary range established for this position based on the factors noted above
and Mr. Compton's prior experience and managerial expertise, his knowledge of
the Company's operations and the industry in which it operates.
Annual Bonus. Pursuant to their respective employment agreements, each
of the Company's named executive officers is eligible for an annual cash bonus.
By contract, Mr. Compton is entitled to an annual performance bonus of up to
110% of his base salary based on a comparison of the Company's average return on
total capital employed over a four-year period as compared to an average target
return on total capital as calculated for a select group of publicly traded
apparel companies over the same period. By contract, Messrs. Kagan, Domino,
Mitchell and Williams are entitled to similarly computed annual performance
bonuses, except that Mr. Kagan's and Mr. Williams' maximum annual bonus equals
80% of their base salary and Mr. Domino's and Mr. Mitchell's maximum bonus
equals 100% of their base salary.
The amount of the cash bonus paid to Mr. Compton as the Company's chief
executive officer was $833,000 for Fiscal 2000, the majority of which was
determined in accordance with the provisions of his current employment
agreement. Additional amounts paid to Mr. Compton represent discretionary
bonuses awarded due to the Company's exceptional performance in Fiscal 2000, and
after review of empirical data establishing compensation levels for other
comparable positions in the industry.
Stock Options. Under the Company's various stock option plans, stock
options may be granted to key employees, including executive officers, directors
and consultants of the Company. All stock option plans are administered by the
Stock Option Committee.
During Fiscal 2000, options to purchase 43,000 shares of Common Stock
were granted to Mr. Compton. The principal factors considered in determining the
granting of stock options to executive officers of the Company, including the
Company's chief executive officer, were the executive officer's tenure with the
Company, his total cash compensation for the prior year, and his contributions
toward the Company's attainment of strategic goals.
Section 162(m) Limitations. Under Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"), a tax deduction by corporate
taxpayers, such as the Company, is limited with respect to the compensation of
certain executive officers unless such compensation is based upon performance
objectives meeting certain regulatory criteria or is otherwise excluded from the
limitation. Based upon the Board of Directors' and the Compensation Committee's
commitment to link compensation with performance as described in this report,
the Board of Directors and the Compensation Committee currently intend to
qualify compensation paid to the Company's executive officers for deductibility
by the Company under Section 162(m) of the Code.
Compensation Committee:
William W. Compton
Leslie J. Gillock
Leon H. Reinhart
Charles J. Smith
December 13, 2000
The report of the Compensation Committee shall not be deemed
incorporated by reference by any general statement incorporating by reference
this proxy statement into any filing under the Securities Act of 1933, as
amended or under the Securities Exchange Act of 1934, as amended, except to the
extent that the Company specifically incorporates this information by reference,
and shall not otherwise be deemed filed under such Acts.
Compensation Committee Interlocks and Insider Participation.
The members of the Compensation Committee are Messrs. Compton, Reinhart and
Smith and Ms. Gillock. Except for Mr. Compton, no officer or employee of the
Company participated in deliberations of the Compensation Committee concerning
executive officer compensation during the fiscal year ended September 30, 2000.
Mr. Compton did not participate in deliberations of the Compensation Committee
that related to his compensation.
Report of the Audit Committee of the Board of Directors
The Audit Committee of the Board of Directors (the "Audit Committee")
is composed of four independent directors and operates under a written charter
(Exhibit A) adopted by the Board of Directors on April 25, 2000 in accordance
with applicable rules of the SEC and Nasdaq. The members of the Audit Committee
are Donald H. Livingstone, Jesus Alvarez-Morodo, Charles J. Smith and Leslie J.
Gillock. The Audit Committee recommends to the Board of Directors, subject to
stockholder ratification, the selection of the Company's independent
accountants.
Management is responsible for the Company's internal controls and the
financial reporting process. The independent accountants are responsible for
performing an independent audit of the Company's consolidated financial
statements in accordance with generally accepted auditing standards and to issue
a report thereon. The Audit Committee's responsibility is to monitor and oversee
these processes.
In this context, the Audit Committee has met and held discussions with
management and the independent accountants. Management represented to the Audit
Committee that the Company's consolidated financial statements were prepared in
accordance with generally accepted accounting principles, and the Audit
Committee has reviewed and discussed the consolidated financial statements with
management and the independent accountants. The Audit Committee discussed with
the independent accountants matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication with Audit Committees).
The Company's independent accountants also provided to the Audit
Committee the written disclosures required by Independence Standards Board
Standard No. 1 (Independence Discussions with Audit Committees), and the Audit
Committee discussed with the independent accountants that firm's independence.
Based upon the Audit Committee's discussion with management and the
independent accountants, and the Committee's review of the representation of
management and the report of the independent accountants to the Audit Committee,
the Audit Committee recommended that the Board of Directors include the audited
consolidated financial statements in the Company's Annual Report on Form 10-K
for the year ended September 30, 2000 filed with the Securities and Exchange
Commission.
Audit Committee:
Donald H. Livingstone
Jesus Alvarez-Morodo
Charles J. Smith
Leslie J. Gillock
December 13, 2000
CERTAIN TRANSACTIONS AND RELATED PARTIES
The Audit Committee of the Board of Directors is responsible for
reviewing all transactions between the Company and any officer or director of
the Company or any entity in which an officer of director has a material
interest. Any such transactions must be on terms no less favorable than those
that could be obtained on an arms-length basis from independent third parties.
One of the Company's subsidiaries contracts distribution services, in
the ordinary course of business from Accel, S.A. de C.V., a twenty-one percent
shareholder of the Company. Fees for these services, including taxes amounted to
approximately $135,000 for fiscal year 2000.
One of the Company's subsidiaries is contemplating the purchase of
approximately nineteen acres of land from Alpha Plus, Inc. This company is
controlled by Mr. Vallina-Laguera, a twenty-one percent shareholder of the
Company. The estimated purchase price is currently $1.3 million. If purchased,
the Company intends to utilize this land to consolidate the operations of its
Savane International Corp. subsidiary, headquartered in El Paso, Texas.
Stock Ownership
The following table sets forth certain information with respect to the
beneficial ownership of Common Stock as of November 30, 2000 by (i) each person
who is known by the Company to beneficially own more than five percent of Common
Stock, (ii) each nominee for director of the Company, (iii) each of the Named
Executive Officers (as defined under "Election of Directors -- Executive
Compensation" above), and (iv) all officers and directors as a group.
Shares Beneficially
Owned
----------------------------------
Name and Address of Beneficial Owner (1) Percent
---------------------------------------- Shares of Class
------ --------
William W. Compton (2)........................................... 1,170,500 14.9%
Richard J. Domino (3)............................................ 90,401 1.2%
Michael Kagan (4)................................................ 710,067 9.1%
Jesus Alvarez-Morodo (5)(6)...................................... 1,631,550 21.3%
Eloy S. Vallina-Laguera (5)(6)................................... 1,625,450 21.2%
Leslie J. Gillock (5)............................................ 25,350 *
Donald H. Livingstone (5)........................................ 27,000 *
Leon H. Reinhart (5)............................................. 27,000 *
Charles J. Smith (7)............................................ 21,667 *
Michael R. Mitchell (8) ......................................... 45,667 *
Gregory L. Williams (9) ......................................... 58,280 *
Accel, S.A. de C.V. (6)
Virginia Fabregas No. 80,
Col. San Rafael, 06470 Mexico, D.F. ........................... 1,600,450 21.0%
Lord Abbett & Co. (10)
767 Fifth Avenue
New York, NY 10153............................................... 1,233,174 16.1%
Peter E. Salas (11)
Dolphin Offshore Partners, L.P.
129 E. 17th Street
New York, NY 10003............................................... 426,000 5.6%
All directors and officers as a group (11 persons)............... 3,832,482 46.0%
------------------
*Less than 1%.
(1) Except as indicated in the footnotes set forth below, the persons named
in the table have sole voting and investment power with respect to all
shares shown as beneficially owned by them. The numbers of shares shown
include shares that are not currently outstanding but which certain
shareholders are entitled to acquire or will be entitled to acquire
within 60 days, upon the exercise of stock options. Such shares are
deemed to be outstanding for the purpose of computing the percentage of
Common Stock owned by the particular shareholder and by the group but are
not deemed to be outstanding for the purpose of computing the percentage
ownership of any other person. Except as indicated in the table, the
business address of all persons named in the table is 4902 W. Waters
Avenue, Tampa, Florida 33634-1302.
(2) Includes 216,000 shares of Common Stock held by the Compton Family
Limited Partnership. Includes 233,000 shares of Common Stock issuable
upon the exercise of vested stock options. Does not include 10,000 shares
of Common Stock issuable upon the exercise of nonvested stock options.
(3) Includes 90,301 shares of Common Stock issuable upon the exercise of
vested stock options. Does not include 19,999 shares of Common Stock
issuable upon the exercise of nonvested stock options. Includes 1,050
shares held as custodian for the benefit of his minor children.
(4) Includes 562,500 shares of Common Stock held by the Kagan Family Limited
Partnership. Includes 147,567 shares of Common Stock issuable upon the
exercise of vested stock options. Does not include 8,333 shares of Common
Stock issuable upon the exercise of nonvested stock options.
(5) Includes 25,000 shares of Common Stock issuable upon the exercise of
vested stock options.
(6) Based on a Schedule 13G filed with the Commission on February 17, 1998.
Includes 1,600,450 shares held by Accel. Mr.Vallina-Laguera owns directly
130,862,957 shares, or 39.2%, of the outstanding Common Stock of Accel.
In addition, he controls companies that hold 46,414,851 shares, or 13.9%,
of the outstanding Common Stock of Accel. Mr. Alvarez-Morodo is the
President and Chief Executive Officer of Accel. The business address of
Mr. Vallina-Laguera is Av. Zarco No. 2401., Col. Zarco, Chihuahua, Chih.,
Mexico, and the business address of Mr. Alvarez-Morodo and Accel is
Virginia Fabregas No. 80, Col. San Rafael, 06470 Mexico, D.F.
(7) Includes 21,667 shares of Common Stock issuable upon the exercise of
vested stock options. Does not include 3,333 shares of Common Stock
issuable upon the exercise of nonvested stock options.
(8) Includes 45,667 shares of Common Stock issuable upon the exercise of
vested stock options. Does not include 33,333 shares of Common Stock
issuable upon the exercise of nonvested stock options.
(9) Includes 35,000 shares of Common Stock issuable upon the exercise of
vested stock options. Includes 18,280 shares held as trustee.
(10) Based on a Schedule 13F-HR filed with the Commission on November 6, 2000.
Lord Abbett & Co. reports sole voting power of 1,233,174 shares of Common
Stock and sole dispositive power of 1,233,174 shares of Common Stock.
(11) Based on a Schedule 13D filed with the Commission on May 3, 2000, Mr.
Salas, as General Partner of Dolphin Offshore Partners, L.P., has sole
voting and dispositive power over 426,000 shares of Common Stock.
Shareholder Return Comparison
The Company's Common Stock began trading on the Nasdaq National Market
on October 29, 1997 in connection with the Company's initial public offering.
The price information reflected for the Common Stock in the following
performance graph represents the closing sale price of the Common Stock for the
period from October 29, 1997 through September 29, 2000. The performance graph
compares the cumulative shareholder returns on the Common Stock with the Nasdaq
Stock Market Index (U.S. Companies) and a Peer Index (as described below) over
the same period (assuming the investment of $100 in the Company's Common Stock,
the Nasdaq Stock Market (U.S. Companies) and the Peer Index on September 29,
2000, and reinvestment of all dividends).
[THE FOLLOWING TABLE WAS REPRESENTED AS A LINE CHART IN THE PRINTED MATERIAL.]
Comparison of Cumulative Total Returns
Tropical Sportswear Int'l Corporation
FY 1997 FY 1998 FY 1999 FY 2000
------- ------- ------- -------
Tropical Sportswear Int'l Corporation 100.0 148.2 151.3 138.1
The Nasdaq Stock Market 100.0 102.1 173.3 231.0
Peer Index 100.0 85.3 72.2 60.7
Total return calculations for the Nasdaq Stock Market Index (U.S.
Companies) and the Peer Index were prepared by the Center for Research in
Security Prices, The University of Chicago. The Peer Index is composed of the
stocks of Haggar Clothing Co. (HGGR), Hartmarx Corporation (HMX), Kellwood
Company (KWD), Oxford Industries, Inc. (OXM), Philips-Van Huesen Corporation
(PVH), Perry Ellis Int'l, Inc. (PERY), Tarrant Apparel Group (TAGS), and V.F.
Corporation (VFC). Specific information regarding the companies comprising the
Peer Index will be provided to any shareholder upon request to Michael Kagan,
the Secretary of the Company.
PROPOSAL II
RATIFICATION OF THE COMPANY'S INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
The Company's Board of Directors has selected Ernst & Young LLP to
conduct the annual audit of the financial statements of the Company for the
fiscal year ending September 29, 2001. Ernst & Young LLP has no financial
interest, direct or indirect, in the Company and does not have any connection
with the Company except in its professional capacity as independent certified
public accountants. The holders of Common Stock will have the opportunity to
ratify the Board of Directors' selection of Ernst & Young LLP as independent
certified public accountants to the Company for the fiscal year ending September
29, 2001. The ratification by the holders of Common Stock of the selection of
Ernst & Young LLP as independent certified public accountants to the Company is
not required by law or by the Bylaws of the Company. The Board of Directors,
consistent with the practice of many publicly held corporations, is nevertheless
submitting this selection to the holders of Common Stock. Representatives of
Ernst & Young LLP will be present at the Annual Meeting and will have an
opportunity to make a statement if they so desire and respond to appropriate
questions. If this selection is not ratified at the Annual Meeting, the Board of
Directors intends to reconsider its selection of independent certified public
accountants for the fiscal year ending September 29, 2001. Even if the selection
is ratified, the Board of Directors in its sole discretion may direct the
appointment of a different independent accounting firm at any time during the
fiscal year if the Board determines that such a change would be in the best
interest of the Company and its shareholders.
The Board of Directors recommends that shareholders vote FOR the
ratification of the selection of Ernst & Young LLP as independent certified
public accountants for the fiscal year September 29, 2001. If a choice is
specified on the Proxy by the shareholder, the shares will be voted as
specified. If no specification is made, the shares will be voted FOR
ratification. Adoption of Proposal II will require that of the votes cast by the
shares of Common Stock represented and entitled to vote at the Annual Meeting,
the votes in favor of the Proposal exceed the votes against the Proposal.
SHAREHOLDER PROPOSALS
FOR 2002 ANNUAL MEETING OF SHAREHOLDERS
Proposals of shareholders,including nominations for the Board of Directors,
intended to be presented at the Company's annual meeting of shareholders to be
held in 2002 should be submitted by certified mail, return receipt requested,
and must be received by the Company at its executive offices in Tampa, Florida
on or before August 24, 2001 to be eligible for inclusion in the Company's Proxy
Statement and Proxy relating to that meeting. Any shareholder proposal must be
in writing and must set forth (i) a description of the business desired to be
brought before the meeting and the reasons for conducting the business at the
meeting, (ii) the name and address, as they appear on the Company's books, of
the shareholder submitting the proposal, (iii) the class and number of shares
that are beneficially owned by such shareholder, (iv) the dates on which the
shareholder acquired the shares, (v) documentary support for any claim of
beneficial ownership, (vi) any material interest of the shareholder in the
proposal, (vii) a statement in support of the proposal, and (viii) any other
information required by the rules and regulations of the Commission.
OTHER MATTERS
Section 16(a) Beneficial Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors and any persons who beneficially own more than ten
percent of the Company's Common Stock to file reports of ownership and changes
in ownership of such securities with the Securities and Exchange Commission and
the National Association of Securities Dealers, Inc. Officers, directors and
beneficial owners of more than ten percent of the Common Stock are required by
applicable regulations to furnish the Company with copies of all Section 16(a)
forms they file. Based solely upon a review of such reports furnished to the
Company and written representations that no other reports were required, during
the fiscal year ended December 31, 1998, all Section 16(a) filing requirements
applicable to directors, executive officers and greater than ten percent
beneficial owners were complied with by such persons, except that Jesus
Alvarez-Morodo was late in filing a Form 3. The Company believes that during
Fiscal 2000, all persons subject to the reporting requirements with regard to
the Common Stock complied with all applicable filing requirements.
Expenses of Solicitation
The cost of soliciting proxies in the accompanying form will be borne by
the Company. In addition to the use of the mails, proxies may be solicited by
directors, officers or other employees of the Company, personally, by telephone
or by telegraph. The Company does not expect to pay any compensation for the
solicitation of proxies, but may reimburse brokers, custodians or other persons
holding stock in their names or in the names of nominees for their expenses in
sending proxy materials to principals and obtaining their instructions.
Miscellaneous
Management does not know of any matters to be brought before the Annual
Meeting other than as described in this Proxy Statement. Should any other
matters properly come before the Annual Meeting, the persons designated as
proxies will vote in accordance with their best judgment on such matters.
Availability of Annual Report on Form 10-K
Accompanying this Proxy Statement is a copy of the Company's Annual Report
on Form 10-K for Fiscal 2000. Shareholders who would like additional copies of
the Annual Report on Form 10-K should direct their requests in writing to:
Tropical Sportswear Int'l Corporation, 4902 W. Waters Avenue, Tampa, Florida
33634-1302, Attention: Michael Kagan, Secretary.
APPENDIX A
TROPICAL SPORTSWEAR INT'L CORPORATION
AUDIT COMMITTEE CHARTER
Organization
The Audit Committee shall be composed solely of at least three independent
directors who are free of any relationship to the Corporation that may interfere
with the exercise of their independence from management and the Corporation. The
Board of Directors, in selecting the members of the Audit Committee, shall make
a determination that each member is independent. The required skills of
committee members as defined by the security regulatory authorities' guidance
will be considered in the choice of members. Specific guidance as to the
standards of independence and the requisite skills for members of the Audit
Committee are included in the Rules of The Nasdaq Stock Market Inc. and in
Securities and Exchange Commission Release 34-42231, dated December 14, 1999,
which are attached to this Charter.
Statement of Policy
The Audit Committee shall assist the Board of Directors in exercising its
authority with respect to financial matters. The Audit Committee will review the
Corporation's accounting and financial reporting practices and the quality and
integrity of the Corporation's financial reporting. In so doing, the Audit
Committee will facilitate free and open communication between the Corporation's
directors, independent auditors, internal auditors and financial management.
Power and Authority
In its review of financial matters, the Audit Committee shall have and may
exercise all the powers and authority of the Board of Directors to the extent
permitted under applicable corporate laws of the State of Florida and the
Articles of Incorporation and Bylaws of the Corporation. Each member of the
Audit Committee shall, in the performance of such member's duties, be fully
protected in relying on information, opinions, reports or statements prepared or
presented by any of the Corporation's officers or employees, or committees of
the Board of Directors or by any other person as to matters the member
reasonably believes are within such other person's professional or expert
competence, all to the extent permitted by applicable corporate laws of the
State of Florida and the Articles of Incorporation and Bylaws of the
Corporation.
Activities
The Audit Committee will review and monitor the Corporation's accounting
policies and financial reporting practices, paying particular attention to any
weaknesses in internal accounting policies and controls, with the primary goal
being to help assure that the Corporation's financial statements present fairly
the Corporation's financial results in accordance with generally accepted
accounting principles.
In the course of these activities, the Audit Committee will:
1. Recommend to the directors the independent auditors to be selected to
audit the financial statements of the Corporation, and review the
independence and objectivity of the independent auditors. In reviewing
the independence of the auditors, the Committee will receive a formal
written statement delineating all relationships between the auditor and
the Corporation, consistent with Independence Standards Board Standard
1; actively engage in a dialogue with the auditors with respect to any
disclosed relationships or services that may impact the objectivity and
independence of the auditor; and either take or recommend that the full
board take appropriate action to oversee the independence of the
outside auditor.
2. Meet with the Corporation's independent auditors and financial
management to review the scope of the proposed audit for the current
year and the audit procedures to be utilized, and, at the conclusion of
the annual audit, review such audit, including any comments or
recommendations of the independent auditors.
3. Prior to the public release of the annual financial statements, meet
with the Corporation's financial management and the independent
auditors to discuss the disclosure and content of the financial
statements, including a discussion of the quality of the accounting
principles applied and significant judgments affecting the
Corporation's financial statements.
4. Discuss with, and report to, the Corporation's financial management and
the Board of Directors the material findings included in the
independent auditors' management letter, if any.
5. Discuss with, and receive reports from, the Corporation's internal
auditors, independent auditors and financial management regarding
material changes in the Corporation's accounting principles, standards
and policies.
6. Discuss with, and receive reports from, the Corporation's independent
auditors, internal auditors and financial management regarding the
adequacy and effectiveness of the Corporation's accounting and
financial controls.
7. Review the Corporation's internal audit function, including its
independence and authority, the proposed audit plans for the coming
year and the coordination of such plans with the Corporation's
independent auditors.
8. Consider and discuss with the Corporation's financial management and
internal auditors significant findings from completed internal audits
during the year and any material changes required in the planned scope
of the internal audit plan. Provide an opportunity for the
Corporation's internal auditors and independent auditors to meet with
the members of the Audit Committee without members of management
present. Among the items to be discussed in these meetings are the
independent auditors' evaluation of the Corporation's financial,
accounting and auditing personnel, and the cooperation that the
independent auditors received during the course of the audit.
9. Investigate any matter brought to its attention within the scope of its
duties, with the power to retain outside counsel for this purpose if,
in its judgment, it is appropriate to do so.
10. Submit the minutes of all meetings of the committee to, or discuss
the matters discussed at each committee meeting with, the Board of
Directors.
11. Review the charter for the Audit Committee and its activities to ensure
that these are consistent with requirements of the SEC, NASDAQ and
other supervisory authorities.
PROXY
TROPICAL SPORTSEAR INT'L CORPORATION
Tampa, Florida
2001 Annual Meeting of Shareholders
The undersigned shareholder of Tropical Sportswear Int'l Corporation
(the "Company"), Tampa, Florida, hereby constitutes and appoints William W.
Compton and Michael Kagan, or either one of them, each with full power of
substitution, to vote the number of shares of Common Stock which the undersigned
would be entitled to vote if personally present at the 2001 Annual Meeting of
Shareholders to be held at the offices of the Company at 4902 West Waters
Avenue, Tampa, Florida 33634-1302 on Tuesday, January 23, 2001, at 10:00 A.M.,
local time, or at any adjournments thereof (the "Annual Meeting"), upon the
proposals described in the Notice to the Holders of Common Stock of the Annual
Meeting of Shareholders and Proxy Statement, both dated December 22, 2000, the
receipt of which is acknowledged, in the manner specified below. The proxies, in
their discretion, are further authorized to vote on any shareholder proposals
submitted to the Company for a vote of the shareholders at the Annual Meeting
after November 23, 2000, as well as on the election of any person as a director
if a director nominee named in Proposal I is unable to serve or for good cause
will not serve, and on matters incident to the conduct of the Annual Meeting. At
the present time, the Board of Directors knows of no other business to be
presented to a vote of the shareholders at the Annual Meeting. The Board of
Directors recommends a vote FOR the proposals.
This Proxy, when properly executed, will be voted in the manner
directed by the undersigned shareholder. If no direction is made, this Proxy
will be voted FOR the proposals.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF TROPICAL
SPORTSWEAR INT’L CORPORATION AND MAY BE REVOKED BY THE SHAREHOLDER PRIOR TO
ITS EXERCISE.
Proposal I: Election of Directors. On the proposal to elect the
following directors to serve until the indicated Annual Meeting of Shareholders
of the Company and until their successors are elected and qualified:
Terms to Expire in 2004
Michael Kagan
Leon H. Reinhart
Charles J. Smith
For |_| Withhold Authority |_|
To withhold authority for any individual nominee(s), write the name of the
nominee(s) in the space provided:
Proposal II: Ratification of the Company's Independent Auditors. On the
Proposal to ratify the selection of Ernst & Young LLP as the Company's
independent auditors for the fiscal year ending September 29, 2001:
For |_| Against |_| Abstain |_|
This Proxy, when properly executed, will be voted in the manner
directed by the undersigned shareholder. If no direction is made, this Proxy
will be voted FOR the proposals.
Please sign exactly as your name appears on your stock certificate and
date. Where shares are held jointly, each shareholder should sign. When signing
as executor, administrator, trustee, or guardian, please give full title as
such. If a corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in full partnership name by
authorized person.
Shares Held: ____________________
__________________________________________
Signature of Shareholder
__________________________________________
Signature of Shareholder (If held Jointly)
Dated: ________________________________
