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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:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[x] 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.
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(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): ............
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
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fee was paid previously. Identify the previous filing by registration
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(4) Date Filed: ...........................................................
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CONTACTS:
BETTIS RAINSFORD MORROW & CO., INC.
(803) 637-5304 Thomas Ball / Ronald Knox
(212) 754-8000
PROXY MONITOR RECOMMENDS INVESTORS SUPPORT THE RAINSFORD
NOMINEES AND VOTE AGAINST MANAGEMENT RECOMMENDATIONS
AT DELTA APPAREL ANNUAL MEETING
PROXY MONITOR RECOMMENDS ELECTION OF RAINSFORD DIRECTOR NOMINEES AND
APPROVAL OF PROPOSAL TO LIMIT TOTAL BONUSES TO 5% OF OPERATING EARNINGS
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EDGEFIELD, SC NOVEMBER 2, 2000 - Bettis Rainsford said today that Proxy
Monitor, a leading provider of proxy advisory services, has recommended to
investors that they support the Rainsford director nominees and shareholder
proposal contained in the Rainsford proxy statement for the Delta Apparel annual
meeting scheduled for November 7, 2000.
Mr. Rainsford is one of the largest shareholders of Delta Apparel and
is leading a solicitation effort in opposition to the current board of Delta
Apparel. He was a co-founder and the long-time CFO of Delta Woodside Industries,
Inc., the company from which Delta Apparel was spun off earlier this year.
Proxy Monitor has recommended a vote FOR the election of the Rainsford
director nominees and FOR the approval of the Rainsford shareholder proposal to
limit total bonuses to all employees to 5% of operating earnings. Proxy Monitor
recommended that investors execute their votes on the Rainsford BLUE proxy card.
"We are pleased that Proxy Monitor, a reputable and independent proxy
advisor, supports our nominees and shareholder proposal," said Mr. Rainsford.
In their report, Proxy Monitor recommended a vote against the incumbent
management directors, stating: "The board's spin-off strategy, adoption of a
"dead hand" poison pill and the excessive compensation awards lead us to the
conclusion that the board has forgotten that its first duty is to shareholders."
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Proxy Monitor went on to state: "Clearly, executing a spin-off, knowing
that the shares might be deeply discounted as a result, with the intent of
repurchasing the issued shares at that low price, is fundamentally unfair to
shareholders. Although the board may not have initiated the spin-off for the
purpose of taking advantage of shareholders, the result of this strategy is, in
our judgement, contrary to shareholders' best interests."
With regard to compensation issues, Proxy Monitor stated: "As for the
compensation issues, not only are the bonuses excessive, the stock plans are
excessively dilutive."
Rainsford also acknowledged, as the Company had announced yesterday,
that a competing advisory service, ISS, had recommended the current directors.
"Frankly, I was astounded by this action. How can a service supposedly dedicated
to serving the best interests of institutional shareholders support directors
who have given out management bonuses equating to $.50 per share, or 27% of the
Company's net income? Imagine what the total Company bonuses paid must have
been. How much value can the Company take from the shareholders and give to only
a few executives?"
Mr. Rainsford went on to say: "As a result of my Proxy Solicitation
effort, Delta Apparel's directors appear to now be professing to embrace the
concept of `maximizing shareholder value'. They announced yesterday that the
Company intends to institute a share repurchase program for up to $3 million of
its outstanding shares and that they are redeeming for cash all rights issued
under the Company's shareholder rights plan or `poison pill.' They have also
announced a forecast for the current fiscal year which shows a continuation of
the good performance the Company has shown in recent quarters.
"For these current directors to now be saying that they are going to
focus on shareholder value is not a credible statement to me. I firmly believe
that the current directors who have been calling the shots have no intention of
focusing on shareholder value in the long-run. They have taken these actions
solely because they were afraid that they would lose the vote at the Annual
Meeting if they did not take some action.
"Furthermore, their announcement that they are going to repurchase
shares, while a good move to support shareholder value, is a clear indication
that they are following through on their pre-conceived plan to take advantage of
shareholders by buying in shares at the discounted values resulting from their
own ill-advised spin-off.
"Based upon my knowledge of Delta Apparel, I believe that their
forecast is indeed an accurate reflection of the prospects for this year. As I
have previously noted, this proxy
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solicitation is not about operating performance, but about the hostile actions
which these directors have taken towards shareholders. I am confident that Delta
Apparel will continue to prosper. All that it needs is to have directors who are
truly committed to maximizing shareholder value. My nominees will do that."
Rainsford also noted that the directors who approved this announcement
are the same directors who have taken the following actions:
- Adopting a `Dead Hand' Poison Pill at Duck Head,
- Adopting a `Dead Head' Poison Pill at Delta Apparel,
- Adopting a Poison Pill at Delta Woodside,
- Adopting the Stock Option and Incentive Stock Award Plans at
the Company, representing 22.5% of the equity, and denying
shareholders the opportunity to vote on it.
- Paying the Company's CEO, during the fiscal year 2000, total
compensation equal to $1,348,286, or about 28% of the net
income of the company.
- Amending Mr. Rockey's million share purchase option at Duck
Head, thus allowing him to purchase nearly 30% of the equity
of that company for 13% of tangible book value.
- Adopting Stock Option and Incentive Stock Award Plans at Duck
Head amounting to 22.5% of the equity, a majority of these
shares being already awarded at approximately 13% of tangible
book value.
- Between the Rockey share purchase option and the Plans at Duck
Head, optioning away over 41% of the shareholders' equity at
that company!!
- Denying Duck Head shareholders the traditional opportunity to
vote on the Plans and actually passing a resolution stating:
`That it is not in the best of the Company and its
shareholders to submit the Plans to the Company's shareholders
at the 2000 Annual Meeting.'
- Approving a Severance Plan for Employees of Duck Head, which,
if implemented, would cost shareholders up to 40% of the
market capitalization of that company at the time the Plan was
approved.
- Increasing their own compensation as Directors from $30,000
annually before the spin-off as Delta Woodside directors to
$60,000 annually for combined service in the three companies
in five years.
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The fact is that none of the above actions, by themselves, would have
been sufficient to cause me to initiate this costly, time-consuming and
emotionally-draining proxy solicitation. However, when all of the actions of
these directors are considered - the whole litany of them - all devoted to
serving the management and directors with practically nothing done to serve the
former Delta Woodside shareholders who have seen their shareholder value shrink
horribly in recent years, I decided that it was critical to lay the issues
before you and provide you with an opportunity to vote. This is the one time in
the life of a corporation that you get your say.
As you consider which proxy card you will send in, ask yourself:
- DO I REALLY OWE THE CURRENT DIRECTORS ANY LOYALTY GIVEN THE
ACTIONS, WHICH THEY HAVE TAKEN?
- IF I VOTE FOR THESE DIRECTORS AND THEREBY SANCTION THEIR
ACTIONS, WHAT MESSAGE WILL THAT SEND TO THE DIRECTORS OF OTHER
CORPORATIONS IN WHICH I AM AN INVESTOR?
Vote for your own interest: Vote the BLUE proxy. Send it in TODAY as
the meeting is next Tuesday.
