UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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[_] Definitive Proxy Statement
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Duck Head Apparel Company, Inc.
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<PAGE>
PRESS RELEASE
FOR ADDITIONAL INFORMATION CONTACT:
November 2, 2000 K. Scott Grassmyer
Winder, Georgia 770-307-4254
COUNTRY'S LEADING PROXY ADVISORY FIRM RECOMMENDS IN FAVOR OF
DUCK HEAD MANAGEMENT IN PROXY CONTEST
Duck Head Apparel Company, Inc. (AMEX: DHA) announced today that Institutional
Shareholder Services (ISS), the country's leading proxy advisory firm, has
published an analysis of the Duck Head proxy contest, recommending that
shareholders vote in favor of management's nominees and reject the slate
proposed by dissident former director Bettis C. Rainsford.
ISS's analysis states, "Duck Head's first quarter results refute some of Mr.
Rainsford's more dire predictions, and bear out management's assertions that the
incumbent board is successfully putting the company on a path to profitability.
We are not convinced that shareholders would be well served by replacing the
entire board and putting the company immediately `up for auction' at a time when
Mr. Rainsford concedes Duck Head's stock price is extraordinarily weak. More
beneficial to shareholders, we believe, would be continued pursuit of the
company's turnaround while the company explores sale opportunities in a
measured, reasonable way designed to yield the greatest value rather than the
most immediate exit strategy."
Robert D. Rockey, Chairman and Chief Executive Officer of Duck Head, commented,
"We are gratified to have received the endorsement of ISS, since they provide
shareholders with an independent, third-party perspective on the important
issues in this contest."
With respect to Mr. Rockey's million-share option, the ISS report states, "The
issue of Mr. Rockey's million-share option is also a nonissue, in our judgment.
The original spirit of Mr. Rockey's option appears to have been to grant him the
ability to acquire one million shares at or near Duck Head's projected fair
market value. When subsequent events made it clear that Duck Head would trade at
a price far less than $10.00 per share, it was reasonable for the board to amend
the option to bring the exercise price in line with Duck Head's post-spin off
stock price. To retain a $10.00-per-share exercise price would have put the
option so far underwater as to render it essentially valueless, both as an award
and as an incentive to Mr. Rockey. To preserve the fundamental incentive value
of the option, it was reasonable of the board to make the present amendment."
As previously announced, in an effort to maximize share value, Duck Head has
elected to retain an investment banking firm to study strategic alternatives,
commence a share repurchase program for up to $3 million of its outstanding
shares and terminate its shareholder rights plan by March 31, 2001. With respect
to these developments, the ISS report states, "The actions described . . .
strengthen our belief that the incumbent board is adequately serving the best
interests of shareholders."
Institutional Shareholder Services is the country's leading, independent proxy
consulting firm. It advises several hundred of the largest banks, pension funds,
money management firms and other institutional investors in the U.S. on how to
vote proxies in contested elections.
Duck Head Apparel Company, Inc., which was spun-off as a separate public
reporting company on June 30, 2000 by Delta Woodside Industries, Inc., is
headquartered in Winder, Georgia, and manufactures and sells men's and boys'
apparel under the Duck Head(R) brand. The company, which employs about 500
people, operates a distribution center in Winder, GA, a garment assembly plant
in Costa Rica and 26 retail outlet stores primarily in the southeastern United
States.
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Statements in this press release that are not reported financial results or
other historical information are forward-looking statements. These are based on
Duck Head Apparel's expectations and are necessarily dependent upon assumptions,
estimates and data that the Company believes are reasonable and accurate but may
be incorrect, incomplete or imprecise. Forward-looking statements are also
subject to a number of business risks and uncertainties, any of which could
cause actual results to differ materially from those set forth in or implied by
the forward-looking statements. These risks and uncertainties include, among
others, changes in the retail demand for apparel products, the cost of raw
materials, competitive conditions in the apparel and textile industries, the
relative strength of the United States dollar as against other currencies,
changes in United States trade regulations and the discovery of unknown
conditions (such as with respect to environmental matters and similar items).
Accordingly, any forward-looking statements do not purport to be predictions of
future events or circumstances and may not be realized. The Company does not
undertake to publicly update or revise the forward-looking statements even if it
becomes clear that any projected results will not be realized.
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