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SCHEDULE 14A
(Rule 14a)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant []
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
DELTA APPAREL, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
BETTIS C. RAINSFORD
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
<TABLE>
<S> <C>
(1) Title of each class of securities to which transaction applies: .......
(2) Aggregate number of securities to which transaction applies: ..........
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (Set forth the amount on which the filing fee is
calculated and state how it was determined): ............
(4) Proposed maximum aggregate value of transaction: ......................
(5) Total fee paid: .......................................................
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid: ...............................................
(2) Form, Schedule or Registration Statement No.: .........................
(3) Filing Party: .........................................................
(4) Date Filed: ...........................................................
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</TABLE>
<PAGE> 2
PROXY STATEMENT OF BETTIS C. RAINSFORD
IN OPPOSITION TO THE SOLICITATION
BY THE BOARD OF DIRECTORS OF
DELTA APPAREL, INC.
ANNUAL MEETING OF SHAREHOLDERS
OF
DELTA APPAREL, INC.
TO BE HELD ON NOVEMBER 7, 2000
DATE OF THIS PROXY STATEMENT - OCTOBER __, 2000
To Fellow Shareholders of Delta Apparel, Inc.:
Bettis C. Rainsford ("Mr. Rainsford") is furnishing this
Proxy Statement in connection with the solicitation of proxies to be used for
the purposes set forth herein at the 2000 Annual Meeting of Shareholders of
Delta Apparel, Inc. (the "Company"), and any adjournment or postponement
thereof (the "Annual Meeting"). According to the Company's Proxy Statement,
dated October 16, 2000, relating to the Annual Meeting (the "Company Proxy
Statement"), the Annual Meeting is currently scheduled to be held on November
7, 2000 at 10:30 a.m., eastern time, at Gunter Theater, 320 South Main Street,
Greenville, South Carolina.
At the Annual Meeting, seven directors of the Company will be elected.
For the reasons discussed in this Proxy Statement, Mr. Rainsford is soliciting
proxies from shareholders for the following purposes:
1. To nominate and elect to the Company's Board of Directors
(the "Board"), Bettis C. Rainsford, Talmadge Knight, Grace G. Young, Donald P.
Howard, Jack J. Jackson, and Roger H. Timpson (collectively, the "Rainsford
Nominees"), in opposition to the election of all the nominees of the Board,
except for Mr. Humphreys, who has been nominated by the Board and whom Mr.
Rainsford supports;
2. To direct the Company's Board to cause the Company to limit
any future annual employee bonuses to five percent (5%) of the operating
earnings of the Company for the fiscal year as to which the bonuses are
awarded; and
3. To ratify the appointment of KPMG LLP as the independent
auditors for the Company for the 2001 fiscal year.
Item 2 above is referred to in this Proxy Statement as the "Rainsford
Proposal."
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Each of Mr. Rainsford's proposals is separate and distinct from each
other proposal. You may approve or vote separately on any or all of the
proposals. The presence, either in person or by proxy, of the holders of
two-thirds of the outstanding shares of common stock at October 9, 2000 is
necessary to constitute a quorum at the Annual Meeting. Directors will be
elected by a plurality of the votes cast at the Annual Meeting and other
proposals will be approved if the votes cast favoring the proposal exceed the
votes cast opposing the proposal. Shareholders do not have the right to cumulate
their votes with respect to the election of directors. Abstentions and broker
non-votes, which are separately tabulated, are included in the determination of
the number of shares present for quorum purposes, but have no effect on the
votes respecting the matters to be voted upon at the meeting.
MR. RAINSFORD RECOMMENDS THAT YOU VOTE IN
FAVOR OF EACH OF THE RAINSFORD NOMINEES AND IN
FAVOR OF THE RAINSFORD PROPOSAL
According to the Company Proxy Statement, the principal executive
offices of the Company are located at 2750 Premiere Parkway, Suite 100, Duluth,
Georgia 30097.
Shareholders of record of shares of the Company's common stock, par
value $0.01 (the "Common Stock"), on October 9, 2000 (the "Record Date") are
entitled to vote at the Annual Meeting. Holders of Common Stock are entitled to
one vote for each share of Common Stock they own. Copies of this Proxy Statement
and the enclosed BLUE form of proxy are first being sent or given to
shareholders on or about October __, 2000. According to the Company Proxy
Statement, there were 2,411,643 shares of Common Stock outstanding as of the
Record Date. On the Record Date, Mr. Rainsford beneficially owned an aggregate
of 334,218 shares, or approximately 13.9%, of the Common Stock. See Annex I
hereto, which is hereby deemed to be a part of this Proxy Statement, for a
detailed summary of all purchases and sales of shares of Common Stock by Mr.
Rainsford and each of the other Rainsford Nominees. Mr. Rainsford intends to
cause all of the shares beneficially owned by him to be voted FOR the Rainsford
Nominees and FOR the Rainsford Proposal. Mr. Rainsford currently believes that
all of the shares owned by the other Rainsford Nominees will be voted for the
Rainsford Nominees and for the Rainsford Proposal.
IMPORTANT
YOUR VOTE IS EXTREMELY IMPORTANT. If you want to vote for the
Rainsford Nominees and/or the Rainsford Proposal, please sign, date and mail
the enclosed BLUE proxy card.
CERTAIN INFORMATION REGARDING MR. RAINSFORD AND
THE RAINSFORD NOMINEES
Mr. Rainsford and the other Rainsford Nominees may be deemed to be
"participants" within the meaning of Regulation 14A under the Securities
Exchange Act of 1934, as amended. Certain biographical information, business
background information and information relating to ownership of the Company's
Common Stock with respect to the Rainsford Nominees is set forth herein under
the heading "Election of Rainsford Nominees as Directors." Certain additional
information with respect to the Rainsford Nominees is set forth herein under
"Voting Securities and Principal Holders Thereof" and in Annex I hereto.
BACKGROUND AND REASONS FOR THE SOLICITATION
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The Company became an independent public company in June 2000,
pursuant to a "spin-off" transaction. The Company had previously operated as a
division of Delta Woodside Industries, Inc. ("Delta Woodside"). In the
spin-off, the Common Stock of the Company was distributed to the shareholders
of Delta Woodside.
Mr. Rainsford had been opposed to the spin-off because he believed that
the Company, as a separate entity, would not be positioned to maximize
shareholder value due to its relatively small market capitalization. The Board
had been warned by various investment banking firms, which had been engaged to
review potential long-term strategies for the Company, including a potential
spin-off, that public companies with relatively small market capitalizations
often have difficulty generating institutional interest, research coverage or
trading volume, and that the resulting illiquidity may translate into price
discounts to larger industry peers or to the inherent value of the Company's
Common Stock. Mr. Rainsford believes this has proven true for the Company as
evidenced by the low volume, trading price and capitalization of the
Company, even in the face of recently improving operating results. The total
market capitalization of the Company as of October __, 2000 was only about
two-thirds of its net tangible book value as of the end of the Company's most
recent fiscal quarter. Mr. Rainsford believes that the Company is too small to
operate as an independent public company in its current state, and the Rainsford
Nominees, if elected to the Board, would aggressively focus on strategies to
maximize shareholder value. These strategies may include a sale, merger,
recapitalization or other extraordinary corporate transactions with respect to
the Company.
Mr. Rainsford believes that the Company's current Board has failed to
represent effectively and adequately the interests of the Company and its
shareholders, has failed to respond to concerns raised by certain of its largest
shareholders and has taken certain steps, including (i) the spin-off of the
Company and its companion apparel company, Duck Head Apparel Company, Inc., from
Delta Woodside into separate public companies; (ii) the adoption of the
shareholder rights plan, commonly called a "poison pill"; (iii) the adoption of
a Stock Option Plan providing for grants of options for up to 500,000 shares and
an Incentive Stock Award Plan providing for grants of up to 200,000 shares; and
(iv) the setting of excessive compensation for the Company's directors and
management, based on historical levels and comparable companies, that otherwise
have the effect of entrenching the Board, substantially reducing the Company's
earnings per share through management bonuses and depressing the Company's share
price.
Mr. Rainsford, in the capacities of shareholder of the Company and
previously as an executive officer of Delta Woodside, has repeatedly voiced his
concerns to the Board regarding management's failure to maximize shareholder
value. Because of the Board's failure to adequately respond to such concerns,
Mr. Rainsford believes that the only effective means of change available to the
Company's shareholders is the election of new directors to the Board. Mr.
Rainsford, therefore, has determined to nominate and to solicit proxies for the
election of six new directors in lieu of all incumbents or other nominees
except for Mr. Humphreys, who has been nominated by the Company for election at
the Annual Meeting and whom Mr. Rainsford supports.
Mr. Rainsford believes that the current directors have consistently
demonstrated a disregard for the interests of the shareholders of the Company.
He thinks that the election as directors of individuals of solid integrity who
have pledged their commitment to the interests of the shareholders of the
Company is essential to preserving and maximizing shareholder value. Mr.
Rainsford believes that the Company would benefit from the election of the
Rainsford Nominees. The Rainsford Nominees are well-qualified individuals who
will bring a wealth of experience, diverse backgrounds, specialized knowledge,
enthusiasm and vigor that will help enhance the Company and its future
activities and growth. They are committed to help unlock the shareholder value
that the present Board has failed to enhance.
As previously discussed, the Rainsford Nominees, if elected, intend to
aggressively focus on strategies to maximize shareholder value, which strategies
may include a sale, merger, recapitalization or other extraordinary corporate
transaction with respect to the Company. As part of this process, one or more of
the Rainsford Nominees may make an offer to acquire the Company. There can be no
assurances that any of the Rainsford Nominees, or any other parties, will make
such a proposal, or, if made, that such a proposal would be adequate. In the
event that one or more of the Rainsford Nominees determines to make an offer to
acquire the Company, a special committee of the Board, consisting of
disinterested directors, would be formed to ensure that the Board continues to
act in the best interests of the Company and its shareholders. In addition, the
Rainsford Nominees intend to pursue the redemption of the Company's poison pill.
Mr. Rainsford believes that the bonuses paid by the Company to
management have been excessive and a waste of corporate assets. The three
executive officers of the Company named in the Company Proxy Statement received
total compensation of $1,937,090 for the Company's 2000 fiscal year. Included in
this amount are bonuses "to reward performance" totaling $1,272,180. Mr.
Rainsford did not vote to approve any of these compensation arrangements during
his tenure on the Board. Based on the Company's capital structure, the amount of
these bonuses, which only include bonuses to three members of the management
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team, represent a payment of over fifty cents ($.50) per share of outstanding
Common Stock. Mr. Rainsford has included a proposal to cause the Board to limit
the total bonuses paid to all employees to five percent (5%) of operating
earnings for the year that the bonus is paid, after giving effect to operating
earnings for the accrual of such bonuses. Although this shareholder proposal is
precatory and cannot bind the Board to take this action, its approval will
make clear to the Board that the shareholders will not tolerate excessive
payments which serve only to benefit management.
ELECTION OF RAINSFORD NOMINEES AS DIRECTORS
Currently, the Board consists of eight members, but the Board has
limited the current election to seven members. The terms of all of the directors
expire at the Annual Meeting. Mr. Rainsford is proposing that the shareholders
of the Company elect the Rainsford Nominees to the Board at the Annual Meeting.
The Rainsford Nominees named in the table below, each of whom has consented to
serve as a director if elected, would serve until the Company's annual meeting
of shareholders in 2001 and until his or her successor has been duly elected and
qualified. Certain additional information with respect to the Rainsford Nominees
is set forth under "Voting Securities and Principal Holders Thereof" and in
Annex I hereto.
<TABLE>
<CAPTION>
NAME, AGE AND BUSINESS ADDRESS PRESENT PRINCIPAL OCCUPATION, FIVE-YEAR EMPLOYMENT
HISTORY AND DIRECTORSHIPS
<S> <C>
Bettis C. Rainsford, age 49 Mr. Rainsford is a co-founder of Delta Woodside (including its
108 1/2 Courthouse Square predecessors), a textile and apparel company, and served as its
P.O. Box 388 Chief Financial Officer from its founding in 1984 until October
Edgefield, SC 29824 1999. He is currently the President of Rainsford Development
Corporation, a company engaged in general business development
activities. Mr. Rainsford is currently a director of Duck Head
Apparel Company, Inc.
Talmadge Knight, age 59 Mr. Knight is the founder, Chief Executive Officer and a director of
310 South Main Street Knight Textile Corporation, an apparel
</TABLE>
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<TABLE>
<S> <C>
Saluda, SC 29138 manufacturing company, and has served in these roles since 1971.
Grace G. Young, age 51 Since October 1997, Ms. Young has served in numerous capacities with
100 CTC Dr. Concurrent Technologies Corporation, a science, technology and
Edgefield, SC 29824 management solutions company. She was the Chief Business Analyst
from October 1997 to December 1999, the Executive Director,
Southern Division from December 1999 to May 2000 and has been
the Executive Director, Health Care Systems since June 2000.
From January 1995 to June 1997, she was the Cabinet Director
for Governor David M. Beasley for South Carolina Parks,
Recreation and Tourism. She is a director of Enterprise
Ventures, a registered broker/dealer.
Donald P. Howard, age 55 From 1987 to present, Mr. Howard has been President of Genin
565 Vann Road Corporation, a retail industry consulting and real estate holding
Trenton, SC 29847 company. Mr. Howard has also been an Assistant Professor of
Management for Augusta State University since 1996. Mr. Howard was
employed by Belk Stores, a retail department store chain, from 1968 to 1987,
where he became a director and Vice President in 1975 and Executive Vice
President and a partner in 1981.
Roger H. Timpson, age 52 Since 1982, Mr. Timpson has been a self-employed private investor.
317 Wigfall Street
Edgefield, SC 29824
Jack J. Jackson, age 54 Prior to his retirement in July 1999, Mr. Jackson served as the
414 Pompano Street Senior Vice President and as President, North America Market Region
Edisto Island, SC 29438 for Pharmacia & Upjohn, Inc., a pharmaceuticals company, from
December 1995. From January 1993 to December 1995, he was the
Senior Vice President, Western Hemisphere Pharmaceutical
Operations and also assumed the temporary responsibility for
International Pharmaceutical Operations of Pharmacia &
Upjohn, Inc. in June 1995.
</TABLE>
It is anticipated that each Rainsford Nominee, if elected, will
receive director's fees limited to $10,000 per annum.
VOTE AND RECOMMENDATION WITH RESPECT TO
THE RAINSFORD NOMINEES
Each share of Common Stock issued and outstanding on the Record Date
is entitled to one vote. Assuming that a quorum is present, directors are
elected by the affirmative vote of a
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plurality of the votes cast by the shares of Common Stock represented at the
Annual Meeting. Accordingly, the eight nominees receiving the greatest number
of votes cast at the Annual Meeting upon the presence of a quorum will be
elected as directors. Because directors will be elected on the basis of the
number of votes cast, proxies that are marked "Withhold Authority" or on which
a broker or other nominee has indicated a lack of discretionary authority
(broker non-votes) will not be counted in the election of directors.
Although it is anticipated that each Rainsford Nominee will be able to
serve as a director, should any Rainsford Nominee become unavailable to serve,
the proxies will be voted for such other person or persons as may be designated
by Mr. Rainsford.
MR. RAINSFORD RECOMMENDS A VOTE
"FOR" THE RAINSFORD NOMINEES
PROPOSAL TO LIMIT MANAGEMENT BONUSES
The three executive officers of the Company named in the Company Proxy
Statement received total compensation of $1,937,090 for the Company's 2000
fiscal year. Included in this amount are bonuses "to reward performance"
totaling $1,272,180. Mr. Rainsford did not vote to approve any of these
compensation arrangements during his tenure on the Board. Based on the Company's
capital structure, the amount of these bonuses, which only include bonuses to
three members of the management team, represent a payment of over fifty cents
($.50) per share of outstanding Common Stock. Mr. Rainsford believes that the
bonuses paid by the Company to management have been excessive and a waste of
corporate assets.
Mr. Rainsford has included a proposal to cause the Board to limit the
total bonuses paid to all employees to five percent (5%) of operating earnings
for the year that the bonus is paid, after giving effect to operating earnings
for the accrual of such bonuses. Although this shareholder proposal is precatory
and cannot bind the Board to take this action, its approval will make clear to
the Board that the shareholders will not tolerate excessive payments which serve
only to benefit management.
MR. RAINSFORD RECOMMENDS A VOTE
"FOR" THE PROPOSAL TO LIMIT MANAGEMENT BONUSES
RATIFICATION OF SELECTION OF AUDITORS
The Board of Directors recommends the ratification of the appointment
of KPMG LLP, independent certified public accountants, as auditors for the
Company and its subsidiaries for the 2001 fiscal year and to audit and report
to the shareholders upon the financial statements of the Company as of and for
the period ending June 30, 2001.
KPMG LLP currently serves as the Company's independent auditors and
was originally engaged by Delta Woodside on August 19, 1994 to serve as
principal accountants for Delta Woodside's 1995 fiscal year.
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Mr. Rainsford believes that representatives of KPMG LLP will be
present at the Annual Meeting and such representatives will have the
opportunity to make a statement if they desire to do so and will be available
to respond to appropriate questions that the shareholders may have. To the best
of Mr. Rainsford's knowledge, neither the firm nor any of its members has any
relation with the Company except in the firm's capacity as auditors or as
advisors.
The decision of the Board to appoint KPMG LLP was based on the
recommendation of the Audit Committee. Mr. Rainsford expects that, in the
future, the Board will continue to appoint the Company's auditors annually
based on the recommendation of the Audit Committee and subsequently submit the
appointment to the shareholders for ratification.
MR. RAINSFORD RECOMMENDS A VOTE
"FOR" THE RATIFICATION OF SELECTION OF AUDITORS
IF YOU PROPERLY SIGN, DATE AND RETURN THE BLUE PROXY CARD, BUT DO NOT
INDICATE YOUR INSTRUCTIONS THEREON, YOUR SHARES WILL BE VOTED FOR EACH OF THE
RAINSFORD NOMINEES AND FOR THE RAINSFORD PROPOSAL.
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STOCK OWNERSHIP OF PRINCIPAL SHAREHOLDERS
AND MANAGEMENT
The Company's Common Stock is the only outstanding class of voting
securities. The following table sets forth certain information as of October 5,
2000, regarding the beneficial ownership of the Company's Common Stock by (i)
persons beneficially owning in any case more than five percent of the Common
Stock, (ii) the directors, (iii) the executive officers of the Company, (iv)
all current directors and executive officers as a group, and (v) each new
nominee for election to the Board at the Annual Meeting. Except for footnote 6
or as otherwise noted, all information in this section is based on information
reported by the Company in the Company Proxy Statement.
<TABLE>
<CAPTION>
SHARES PERCENTAGE OF
BENEFICIALLY CLASS
NAME OF BENEFICIAL OWNER OWNED OUTSTANDING
------------------------ ----- -----------
<S> <C> <C>
Reich & Tang Asset Management L.P. (1) 284,300 11.8%
600 Fifth Avenue
New York, New York 10020
Franklin Resources, Inc. (2) 224,000 9.3%
Franklin Advisory Services, LLC
Charles B. Johnson
Rupert H. Johnson, Jr.
777 Mariners Island Boulevard
San Mateo, California 94404
Dimensional Fund Advisors Inc. (3) 194,291 8.1%
1299 Ocean Avenue, 11th Floor
Santa Monica, California 90401
Royce & Associates (4) 187,440 7.8%
1414 Avenue of the Americas
Ninth Floor
New York, NY 10019
E. Erwin Maddrey, II (5) 347,593 14.4%
233 North Main Street
Suite 200
Greenville, SC 29601
Bettis C. Rainsford (6) 334,218 13.9%
108-1/2 Courthouse Square
Post Office Box 388
Edgefield, SC 29824
Buck A. Mickel (7) (8) 158,742 6.6%
Post Office Box 6721
Greenville, SC 29606
Micco Corporation (8) 124,063 5.1%
</TABLE>
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<TABLE>
<S> <C> <C>
Post Office Box 795
Greenville, SC 29602
Minor H. Mickel (8) (9) 157,804 6.5%
415 Crescent Avenue
Greenville, SC 29605
Minor M. Shaw (8) (10) 150,560 6.2%
Post Office Box 795
Greenville, SC 29602
Charles C. Mickel (8) (11) 149,694 6.2%
Post Office Box 6721
Greenville, SC 29606
William F. Garrett (12) 17,671 (19)
C. C. Guy (13) 3,849 (19)
Robert W. Humphreys (14) 6,010 (19)
Dr. James F. Kane (15) 4,055 (19)
Dr. Max Lennon (16) 2,881 (19)
Herbert M. Mueller (17) 3,834 (19)
All current directors and executive officer as a group (8 544,635 22.6%
persons) (18)
</TABLE>
-----------------------------------
(1) Reich & Tang Asset Management L.P. ("Reich & Tang") has not
yet filed with the Securities and Exchange Commission any document related
specifically to its ownership of the securities of the Company. The information
set forth above is based on an amendment to Schedule 13G that was filed with
the Securities and Exchange Commission on February 15, 2000 by Reich & Tang
pertaining to its ownership solely of Delta Woodside common stock and
confirmation obtained on September 20, 2000 from Reich & Tang. However, based
on the confirmation obtained from Reich & Tang, the Company understands that
Reich & Tang possesses the same ownership, voting and dispositive power with
respect to the Company's shares as it does for the shares of Delta Woodside
(adjusted to reflect that one share of the Company's Common Stock was
distributed for every 10 Delta Woodside shares in the spin-off with cash paid
in lieu of fractional shares). In the amendment, Reich & Tang reported that,
with respect to the common stock of Delta Woodside, it has shared voting power
and shared dispositive power with respect to all of the shares shown. The
amendment reported that the shares of Delta Woodside common stock were held on
behalf of certain accounts for which Reich & Tang provides investment advice
and as to which Reich & Tang has full voting and dispositive power for as long
as it retains management of the assets. According to the amendment, each
account has the right to receive and the power to direct receipt of dividends
from, or the proceeds from the sale of, the Delta Woodside shares. The
amendment reported that none of such accounts has an interest with respect to
more than 5% of the outstanding shares of Delta Woodside.
(2) Franklin Resources, Inc. ("FRI") has not yet made a filing
with the Securities and Exchange Commission related specifically to the
securities of the Company. The information set forth above is based on an
amendment to Schedule 13G that was filed by FRI with the Securities and
Exchange Commission on January 20, 2000 with respect to Delta Woodside common
stock and on confirmation obtained on September 20, 2000. However, based on the
confirmation, the Company understands that FRI possesses the same ownership,
voting and dispositive power with respect to the Company's shares as it does
for the shares of Delta Woodside (adjusted to reflect that one share of the
Company's Common Stock was distributed for every 10 Delta Woodside shares in
the
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spin-off with cash paid in lieu of fractional shares). In the amendment FRI
reported that, with respect to Delta Woodside common stock, the shares are
beneficially owned by one or more investment companies or other managed
accounts that are advised by one or more direct and indirect investment
advisory subsidiaries of FRI. The amendment reported that the advisory
contracts grant to the applicable investment advisory subsidiary(ies) all
investment and/or voting power over the securities owned by their investment
advisory clients. Accordingly, such subsidiary(ies) may be deemed to be the
beneficial owner of the shares shown in the table. The amendment reported that
Charles B. Johnson and Rupert H. Johnson, Jr. (the "FRI Principal
Shareholders") (each of whom has the same business address as FRI) each own in
excess of 10% of the outstanding common stock and are the principal
shareholders of FRI and may be deemed to be the beneficial owners of securities
held by persons and entities advised by FRI subsidiaries. The amendment
reported that one of the investment advisory subsidiaries, Franklin Advisory
Services, LLC (whose address is One Parker Plaza, Sixteenth Floor, Fort Lee,
New Jersey 07024), has sole voting and dispositive power with respect to all of
the shares shown. FRI, the FRI Principal Shareholders and the investment
advisory subsidiaries disclaim any economic interest or beneficial ownership in
the shares and are of the view that they are not acting as a "group" for
purposes of the Securities Exchange Act of 1934, as amended. The amendment
reported that Franklin Balance Sheet Investment Fund, a series of Franklin
Value Investors Trust, a company registered under the Investment Company Act of
1940, has an interest in more than 5% of the class of securities reported in
the amendment.
(3) Dimensional Fund Advisors Inc. ("Dimensional") has not yet
made a filing with the Securities and Exchange Commission specifically related
to its ownership of securities of the Company. The information set forth above
is based on an amendment to Schedule 13G that was filed by Dimensional with the
Securities and Exchange Commission on February 3, 2000 with respect to its
ownership of shares of Delta Woodside and on confirmation obtained on September
20, 2000. However, based on the confirmation, the Company understands that
Dimensional possesses the same ownership, voting and dispositive power for the
shares of the Company as it does for those of Delta Woodside (adjusted to
reflect that one share of the Company's Common Stock was distributed for every
10 Delta Woodside shares in the spin-off with cash paid in lieu of fractional
shares). Dimensional reported that it had sole voting power and sole
dispositive power with respect to all of the shares. The amendment reports that
Dimensional furnishes investment advice to four investment companies and serves
as investment manager to certain other commingled group trusts and separate
accounts, that all of the shares of Delta Woodside's common stock were owned by
such investment companies, trusts or accounts, that in its role as investment
adviser or manager Dimensional possesses voting and/or investment power over
the Delta Woodside shares reported, that Dimensional disclaims beneficial
ownership of such securities and that, to the knowledge of Dimensional, no such
investment company, trust or account client owned more than 5% of the
outstanding shares of Delta Woodside's common stock.
(4) This information was provided to the Company by telephone on
October 9, 2000 by an employee of Royce & Associates.
(5) Mr. Maddrey is a director of the Company, Delta Woodside and
Duck Head Apparel Company, Inc. and was the President and Chief Executive
Officer of Delta Woodside until June 2000. The number of shares shown as
beneficially owned by Mr. Maddrey includes 43,147 shares held by the E. Erwin
and Nancy B. Maddrey, II Foundation, a charitable trust, as to which shares Mr.
Maddrey holds sole voting and investment power but disclaims beneficial
ownership and approximately 107 shares allocated to the account of Mr. Maddrey
in Delta Woodside's Savings and Investment Plan (the "Delta Woodside 401(k)
Plan"). Mr. Maddrey is fully vested in the shares allocated to his account in
the Delta Woodside 401(k) Plan.
(6) Mr. Rainsford is currently a director of the Company. Mr.
Rainsford reported beneficial ownership of 334,218 shares of Common Stock in
Amendment No. 1 to Schedule 13D, filed with the SEC on October 6, 2000. Mr.
Rainsford disclaims beneficial ownership of 4,794 of these shares registered in
the name of The Edgefield County Foundation over which he holds voting and
investment power. Mr. Rainsford has pledged a total of 329,408 shares of Common
Stock to Carolina First Bank and Merrill Lynch & Co. as security for certain
loans.
(7) Buck A. Mickel is a director of the Company, Delta Woodside
and Duck Head Apparel Company, Inc. The number of shares shown as beneficially
owned by Buck A. Mickel includes 34,392 shares directly owned by him, all of
the 124,063 shares owned by Micco Corporation, and 287shares held by him as
custodian for a minor. See Note (8).
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(8) Micco Corporation owns 124,063 shares of the Company's common
stock. The shares of common stock of Micco Corporation are owned in equal parts
by Minor H. Mickel, Buck A. Mickel (a director of the Company), Minor M. Shaw
and Charles C. Mickel. Buck A. Mickel, Minor M. Shaw and Charles C. Mickel are
the children of Minor H. Mickel. Minor H. Mickel, Buck A. Mickel, Minor M. Shaw
and Charles C. Mickel are officers and directors of Micco Corporation. Each of
Minor H. Mickel, Buck A. Mickel, Minor M. Shaw and Charles C. Mickel disclaims
beneficial ownership of three quarters of the shares of the Company's common
stock owned by Micco Corporation. Minor H. Mickel directly owns 33,741 shares
of the Company's common stock. Buck A. Mickel, directly or as custodian for a
minor, owns 34,679 shares of the Company's common stock. Charles C. Mickel,
directly or as custodian for his children, owns 25,621 shares of the Company's
common stock. Minor M. Shaw, directly or as custodian for her children, owns
25,049 shares of the Company's common stock. Minor M. Shaw's husband, through
an individual retirement account and as custodian for their children,
beneficially owns approximately 1,448 shares of the Company's common stock, as
to which shares Minor M. Shaw may also be deemed a beneficial owner. Minor M.
Shaw disclaims beneficial ownership with respect to these shares and with
respect to the 274 shares of the Company's common stock held by her as
custodian for her children. The spouse of Charles C. Mickel owns 10 shares of
the Company's common stock, as to which shares Charles C. Mickel may also be
deemed a beneficial owner. Charles C. Mickel disclaims beneficial ownership
with respect to these shares and with respect to the 351 shares of the
Company's common stock held by him as custodian for his children. Buck A.
Mickel disclaims beneficial ownership with respect to the 287 shares of the
Company's common stock held by him as custodian for a minor.
(9) The number of shares shown as beneficially owned by Minor H.
Mickel includes 33,741 shares directly owned by her and all of the 124,063
shares owned by Micco Corporation. See Note (8).
(10) The number of shares shown as beneficially owned by Minor M.
Shaw includes 25,621 shares owned by her directly or as custodian for her
children, approximately 1,448 shares beneficially owned by her husband through
an individual retirement account or as custodian for their children, and all of
the 124,063 shares owned by Micco Corporation. See Note (8).
(11) The number of shares shown as beneficially owned by Charles
C. Mickel includes 25,621 shares owned by him directly or as custodian for his
children, 10 shares owned by his wife and all of the 124,063 shares owned by
Micco Corporation. See Note (8).
(12) William F. Garrett is a director of the Company, Delta
Woodside and Duck Head Apparel Company, Inc. The number of shares shown as
beneficially owned by Mr. Garrett includes 208 shares allocated to the account
of Mr. Garrett in the Delta Woodside 401(k) Plan. Mr. Garrett is fully vested
in the shares allocated to his account in the Delta Woodside 401(k) Plan.
(13) C. C. Guy is a director of the Company, Delta Woodside and
Duck Head Apparel Company, Inc. The number of shares shown as beneficially
owned by C. C. Guy includes 1,896 shares owned by his wife, as to which shares
Mr. Guy disclaims beneficial ownership.
(14) Robert W. Humphreys is President and Chief Executive Officer
and a director of the Company. Excluded from the table are 62,500 shares
covered by options that are not exercisable within 60 days after October 5,
2000 and 16,000 shares subject to awards under the Company's Incentive Stock
Award Plan which will not vest within 60 days after October 5, 2000.
(15) Dr. James F. Kane is a director of the Company, Delta
Woodside and Duck Head Apparel Company, Inc. The shares shown as beneficially
owned by him are held in a Keogh account or an IRA account.
(16) Dr. Max Lennon is a director of the Company, Delta Woodside
and Duck Head Apparel Company, Inc.
(17) Herbert M. Mueller is Vice President, Chief Financial Officer
and Treasurer of the Company. Excluded from the table are 14,000 shares covered
by options that are not exercisable within 60 days after October 5, 2000 and
4,800 shares subject to awards under the Company's Incentive Stock Award Plan
which will not vest within 60 days after October 5, 2000.
11
<PAGE> 13
(18) Includes all shares deemed to be beneficially owned by any
current director or executive officer.
(19) Less than one percent.
The following table sets forth the ownership of the Common Stock as of
October __, 2000, by each of the Rainsford Nominees. Unless otherwise
indicated, such persons have sole voting and investment power with respect to
such shares, and all such shares are owned beneficially by the person
indicated.
<TABLE>
<CAPTION>
AMOUNT OF BENEFICIAL
NAME OWNERSHIP PERCENT OF CLASS (1)
---- ---------- --------------------
<S> <C> <C>
Bettis C. Rainsford (2) 334,218 13.9%
Talmadge Knight 0 0
Grace G. Young 0 0
Donald P. Howard 0 0
Jack J. Jackson 0 0
Roger H. Timpson 0 0
</TABLE>
(1) Based on the Common Stock shown as outstanding as of the date
of the Information Statement.
(2) Mr. Rainsford reported beneficial ownership of 334,218 shares
of Common Stock in Amendment No. 1 to Schedule 13D, filed with the SEC on
October 6, 2000. Mr. Rainsford disclaims beneficial ownership over 4,794 of
these shares registered in the name of The Edgefield County Foundation over
which he holds voting and investment power. Mr. Rainsford has pledged a total
of 329,408 shares of Common Stock to Carolina First Bank and Merrill Lynch &
Co. as security for certain loans.
INFORMATION CONCERNING THE SOLICITATION OF PROXIES
The costs of this solicitation will be borne by Mr. Rainsford.
Talmadge Knight has agreed to reimburse Mr. Rainsford up to $62,500 of the cost
of this solicitation of proxies. In addition to solicitation by mail, Mr.
Rainsford may solicit proxies in person, by telephone, by telegram, by personal
interview, by e-mail or by telecopier. Mr. Rainsford will not receive any
compensation for such solicitations. Mr. Rainsford will request banks,
brokerage houses and other custodians, nominees and fiduciaries to forward Mr.
Rainsford's proxy materials to the beneficial owners of the shares of Common
Stock they hold of record and obtain authorization for the execution of proxy
cards. Mr. Rainsford will reimburse these record holders for customary mailing
expenses incurred by them in forwarding Mr. Rainsford's materials. Mr.
Rainsford has retained Morrow & Co. to assist Mr. Rainsford in connection with
communications with shareholders and to provide other services in connection
with the solicitation of proxies. The fee of Morrow & Co. is estimated to be
$75,000, plus reasonable out-of-pocket costs and expenses. To date, Mr.
Rainsford has paid Morrow & Co. approximately $_____. Approximately 30
employees of Morrow & Co. are expected to be utilized in connection with the
solicitation of proxies. Neither Mr. Rainsford nor, to the best of Mr.
12
<PAGE> 14
Rainsford's knowledge, any person acting on his behalf has retained any other
person to make solicitations or recommendations to security holders on his
behalf in connection with the solicitation of proxies. Costs related to the
solicitation of proxies with respect to the election of the Rainsford Nominees
include expenditures for attorneys, proxy solicitors, printing, postage, and
related expenses and fees and are expected to aggregate approximately $______.
To date, Mr. Rainsford has spent approximately $_______ of such total estimated
expenditures. Mr. Rainsford intends to seek reimbursement from the Company for
the costs incurred in connection with this proxy solicitation. Such request for
reimbursement will not be submitted to a vote of the Company's shareholders.
PROXY PROCEDURES
Unless contrary instructions are indicated on the proxy, all shares of
Common Stock represented by valid proxies received pursuant to this solicitation
(and not revoked before they are voted) will be voted FOR the election of the
Rainsford Nominees and FOR the Rainsford Proposal. A proxy executed by a holder
of shares may be revoked at any time before its exercise by sending a written
revocation (as provided below), by submitting another properly executed proxy
with a later date prior to the time of the Annual Meeting or by ballot at the
Annual Meeting. The mere presence of any shareholder at the Annual Meeting will
not operate to revoke his or her proxy. The revocation may be delivered to the
Secretary of the Company at the Company's principal executive offices. Although
a revocation or a later dated proxy delivered to the Company but not to Mr.
Rainsford will be effective, Mr. Rainsford requests that if a revocation or a
later dated proxy is delivered only to the Company, a photostatic copy of the
revocation or later dated proxy also be delivered to Mr. Rainsford so that he
will be aware of such revocation or later dated proxy. All revocations received
by Mr. Rainsford will be delivered to the Company immediately prior to the
convening of the Annual Meeting. Shareholders who have executed and returned a
proxy and who then attend the Annual Meeting and desire to vote in person are
requested to so notify Mr. Rainsford prior to the time of the Annual Meeting. IF
YOU WISH TO VOTE FOR THE ELECTION OF THE RAINSFORD NOMINEES TO THE BOARD AND FOR
THE RAINSFORD PROPOSAL, PLEASE SIGN, DATE AND RETURN PROMPTLY THE ENCLOSED BLUE
PROXY CARD IN THE POSTAGE-PAID ENVELOPE PROVIDED OR FAX BOTH SIDES OF THE
ENCLOSED BLUE PROXY CARD TO MR. RAINSFORD AT (803) 637-6066. MR. RAINSFORD
RECOMMENDS THAT YOU VOTE "FOR" THE RAINSFORD NOMINEES AND "FOR" THE RAINSFORD
PROPOSAL.
SHAREHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Pursuant to Section 2.14 of the Company's Bylaws, as amended, for any
shareholder proposal to be eligible for inclusion in the Company's proxy
statement and form of proxy for the next annual meeting, the proposals must be
received at the Company's executive offices not later than 120 calendar days
prior to the first anniversary date of the immediately preceding annual meeting
or not later than 10 days after notice or public disclosure of the date of the
annual
13
<PAGE> 15
meeting shall be given or made to shareholders, whichever date is earlier. Such
proposals should be submitted by certified mail, return receipt requested,
addressed to the Company, 2750 Premiere Parkway, Suite 100, Duluth, Georgia
30097, Attention: Secretary.
COMPANY INFORMATION
Except as otherwise noted herein, the information concerning the
Company contained in this Proxy Statement has been taken from or is based upon
documents and records on file with the SEC and other publicly available
information. Although Mr. Rainsford does not have any knowledge that would
indicate that any statement contained herein based upon such documents and
records is untrue, Mr. Rainsford does not take any responsibility for the
accuracy or completeness of the information contained in such documents and
records, or for any failure by the Company to disclose events that may affect
the significance or accuracy of any such information.
OTHER MATTERS
Except as otherwise noted herein, Mr. Rainsford knows of no other
matters that are likely to be brought before the Annual Meeting, but if other
matters do properly come before the meeting, the persons named in the enclosed
proxy, or their substitutes, will vote the proxy in accordance with their best
judgment.
**********
It is important that your BLUE proxy card be returned promptly. If
you do not plan to attend the Annual Meeting, we urge you to fill out, date and
mail the enclosed BLUE proxy card in the enclosed envelope, which requires no
postage if mailed in the United States.
Dated: October __, 2000
Bettis C. Rainsford
14
<PAGE> 16
ANNEX I
Within the past two years, Mr. Rainsford and the Rainsford Nominees
have engaged in the following transactions in securities of the Company:
<TABLE>
<CAPTION>
TRADE QUANTITY
PARTICIPANT DATE (SHARES)
----------- ---- --------
<S> <C> <C>
Bettis C. Rainsford 6/30/00 14,880*
</TABLE>
*Mr. Rainsford received these shares pursuant to Delta Woodside's Long
Term Incentive Plan.
Except as set forth in this Proxy Statement, none of the Rainsford
Nominees or any associate or any other participant of the foregoing, directly
or indirectly owns any securities of the Company or any subsidiary of the
Company beneficially or of record, has the right to acquire beneficial
ownership within 60 days or has purchased or sold such securities within the
past two years.
To the knowledge of the Rainsford Nominees, except as set forth in
this Proxy Statement, none of the Rainsford Nominees or any other participant
has any substantial interest, direct or any indirect, by securities holdings or
otherwise, in any matter to be acted upon at the Annual Meeting, except for the
election of directors.
No part of the purchase price of the shares of Common Stock
beneficially owned by any the Rainsford Nominees, or any other participant is
represented by funds borrowed or otherwise obtained for the purpose of
acquiring or holding securities.
Except as set forth in this Proxy Statement, none of the Rainsford
Nominees, or any other participant is, or within the past year has been a party
to any contract, arrangement, or understanding with any person with respect to
any securities of the Company.
Except as set forth in this Proxy Statement, none of the Rainsford
Nominees or any other participant, or any associate of the foregoing, has any
arrangement or understanding with any person (A) with respect to any future
employment by the Company or its affiliates or (B) with respect to its future
transactions to which the Company or any affiliates will or may be a party.
There are no pending legal proceedings in which any Rainsford Nominees
or any other Participant, or any of their respective associates, is a party
adverse to the Company or any of its affiliates or in which any Rainsford
Nominees, or any other Participant, or any of their respective associates has
an interest adverse to the Company or its affiliates.
Except as set forth in this Proxy Statement, there are no
transactions, or series of transactions, since the beginning of the Company's
last fiscal year, or any currently proposed
15
<PAGE> 17
transactions, in which the Company or any of its subsidiaries was a party, in
an amount which exceeds $60,000 and in which any Rainsford Nominee has a
material interest.
16
<PAGE> 18
2000 ANNUAL MEETING OF THE SHAREHOLDERS OF
DELTA APPAREL, INC.
TO BE HELD ON NOVEMBER 7, 2000
THIS PROXY IS SOLICITED BY BETTIS C. RAINSFORD ("MR. RAINSFORD")
AND NOT BY THE COMPANY'S BOARD OF DIRECTORS
The undersigned hereby appoints and , and each of
them, with full power of substitution, as proxy of the undersigned to vote all
of the common stock, par value $0.01 (the "Common Stock"), of Delta Apparel,
Inc. (the "Company") that the undersigned is entitled to vote if personally
present at the Annual Meeting of Shareholders of the Company to be held at:
Gunter Theater
320 South Main Street
Greenville, South Carolina
on Tuesday, November 7, 2000, at 10:30 A.M., eastern time, and at any and all
adjournment(s) or postponement(s) thereof.
ELECTION OF DIRECTORS
MR. RAINSFORD RECOMMENDS A VOTE "FOR" THE FOLLOWING DIRECTOR NOMINEES:
1. Election of Bettis C. Rainsford, Talmadge Knight, Grace G. Young, Donald
P. Howard, Jack J. Jackson and Roger H. Timpson.
<TABLE>
<S> <C> <C> <C>
[ ] FOR ALL NOMINEES LISTED ABOVE [ ] WITHHOLD AUTHORITY TO VOTE FOR ALL NOMINEES LISTED
(EXCEPT AS MARKED TO THE CONTRARY BELOW) ABOVE
</TABLE>
INSTRUCTIONS
To withhold authority to vote for the election of one or more of such
candidate(s), mark FOR above and write the name(s) of the person(s) with whom
you wish to withhold authority in the following space.
--------------------------------------------------------------------------------
MR. RAINSFORD RECOMMENDS A VOTE "FOR" THE FOLLOWING PROPOSALS:
2. To direct the Board to cause the Company to limit any future annual
employee bonuses to five percent (5%) of the operating earnings of the
Company for the fiscal year as to which the bonuses are awarded.
<TABLE>
<S> <C> <C>
[ ] [ ] [ ]
FOR AGAINST ABSTAIN
</TABLE>
(Continued and to be dated and signed on the reverse side)
(Continued from other side)
3. To ratify the selection of KPMG LLP as the independent auditors for the
Company for the 2001 fiscal year.
<TABLE>
<S> <C> <C>
[ ] [ ] [ ]
FOR AGAINST ABSTAIN
</TABLE>
MR. RAINSFORD RECOMMENDS YOU VOTE "FOR" ITEMS 2 AND 3
The above-named proxies of the undersigned are authorized to vote, in their
discretion, upon such other matters as may properly come before the Annual
Meeting and any adjournment(s) or postponement(s) thereof.
WHEN PROPERLY EXECUTED, THIS PROXY WILL BE VOTED IN THE MANNER MARKED HEREIN
BY THE UNDERSIGNED. IF NO MARKING IS MADE, THIS PROXY WILL BE VOTED "FOR" THE
ELECTION OF THE RAINSFORD NOMINEES DESCRIBED ABOVE AND "FOR" PROPOSALS 2 AND 3.
THE UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT OF THE PROXY STATEMENT FROM MR.
RAINSFORD, DATED OCTOBER , 2000, SOLICITING PROXIES FOR THE ANNUAL
MEETING.
ALL PREVIOUS PROXIES GIVEN BY THE UNDERSIGNED TO VOTE AT THE ANNUAL MEETING
OR AT ANY ADJOURNMENT(S) OR POSTPONEMENT(S) THEREOF ARE HEREBY REVOKED.
Dated: , 2000
--------------------------------
----------------------------------------
Signature
----------------------------------------
Signature, if held jointly
----------------------------------------
Title of Authority
Please date this Proxy and sign it
exactly as your name or names appear on
your stock certificates or on a label
affixed hereto. When shares are held
jointly, EACH joint owner should sign.
When signing as attorney, executor,
administrator, trustee, guardian,
corporate officer, etc., give full title
as such. If shares are held by a
corporation, please sign in full the
corporate name by President or other
authorized officer. If shares are held
by a partnership, please sign in the
partnership name by an authorized
person.
IMPORTANT: PLEASE SIGN, DATE AND MAIL YOUR PROXY PROMPTLY IN THE ENCLOSED
ENVELOPE.
