SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(X ) Filed by the Registrant
( ) Filed by a Party other than the Registrant
Check the appropriate box:
( ) Preliminary Proxy Statement
(X ) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to (section mark)240.14a-11(c) or
(section mark)240.14a-12
Genesco Inc.
(Name of Registrant as Specified In Its Charter)
Genesco Inc.
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (Check the appropriate box):
(X ) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
( ) $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
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: (1)
4) Proposed maximum aggregate value of transaction:
(1) Set forth the amount on which the filing fee is calculated and state how
it was determined.
( ) 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:
<PAGE>
(GENESCO logo appears here)
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
The annual meeting of shareholders of Genesco Inc. will be held at the Company's
executive offices, Genesco Park, 1415 Murfreesboro Road, Nashville, Tennessee,
on Wednesday, June 28, 1995 at 10:00 a.m. for the purposes of:
1. electing seven directors;
2. approving the Genesco Employee Stock Purchase Plan;
3. approving the appointment of Price Waterhouse as independent accountants
for the Company for the fiscal year ending January 31, 1996;
4. if presented at the meeting, acting upon a shareholder proposal
regarding cumulative voting;
5. if presented at the meeting, acting upon a shareholder proposal
regarding confidential voting;
6. if presented at the meeting, acting upon a shareholder proposal
regarding the Shareholder Rights Plan; and
7. transacting such other business as may properly come before the meeting.
Shareholders of record at the close of business on May 18, 1995 will be entitled
to vote at the meeting.
By order of the board of directors.
Roger G. Sisson
Secretary
May 22, 1995
IMPORTANT
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. PLEASE SIGN,
DATE AND RETURN THE ENCLOSED PROXY PROMPTLY IN ORDER THAT YOUR SHARES WILL BE
VOTED. A RETURN ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES IS ENCLOSED FOR YOUR CONVENIENCE.
<PAGE>
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(GENESCO logo appears here)
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
WEDNESDAY, JUNE 28, 1995
This proxy statement is furnished in connection with the solicitation of proxies
by the board of directors of Genesco Inc. ("Genesco" or the "Company") to be
voted at the annual meeting of shareholders to be held at the offices of the
Company, beginning at 10:00 a.m. on Wednesday, June 28, 1995, and at any
adjournments thereof, for the purposes set forth in the accompanying notice.
This proxy material was first mailed to shareholders on or about May 22, 1995.
The Company will pay the cost of solicitation. In addition to this solicitation
by mail, proxies may be solicited by officers, directors and regular employees
of the Company, without extra compensation, personally and by mail, telephone or
telegraph. The Company has retained the firm of Georgeson & Co. Inc. to aid in
the solicitation of proxies, for which the Company will pay a fee of $12,500.
Brokers, nominees, fiduciaries and other custodians will be requested to forward
soliciting material to the beneficial owners of shares and will be reimbursed
for their expenses.
All valid proxies which are received will be voted in accordance with the
recommendations of the board of directors, unless otherwise specified thereon. A
shareholder may revoke a proxy before the proxy is voted at the annual meeting
by giving written notice of revocation to the secretary of the Company, by
executing and delivering a later-dated proxy or by attending the annual meeting
and voting his or her shares in person.
The board of directors is not aware of any matter to be submitted for
consideration at the annual meeting other than those set forth in the
accompanying notice. If any other matter properly comes before the meeting for
action, proxies will be
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voted on such matter in accordance with the best judgment of the persons named
as proxies.
The Company's executive offices are located at Genesco Park, 1415 Murfreesboro
Road, Nashville, Tennessee 37217.
VOTING SECURITIES
The various classes of voting preferred stock and the common stock will vote
together as a single group at the annual meeting.
As of May 18, 1995, the record date for determination of shareholders entitled
to notice of and to vote at the annual meeting, the number of voting shares
outstanding and the number of votes entitled to be cast were as follows:
<TABLE>
<CAPTION>
CLASS OF NO. OF VOTES PER TOTAL
STOCK SHARES SHARE VOTES
<S> <C> <C> <C>
Subordinated Serial Preferred Stock:
$2.30 Series 1 37,233 1 37,233
$4.75 Series 3 19,632 2 39,264
$4.75 Series 4 16,412 1 16,412
$1.50 Subordinated Cumulative
Preferred Stock 30,017 1 30,017
Employees' Subordinated Convertible Preferred
Stock 80,313 1 80,313
Common Stock 24,343,663 1 24,343,663
</TABLE>
A majority of the votes entitled to be cast on a matter constitutes a quorum for
action on that matter. Once a share is represented at a meeting, it is deemed
present for quorum purposes for the remainder of the meeting. A plurality of the
votes cast is necessary for the election of directors. The affirmative vote of a
majority of the total votes cast either for or in opposition to any other
proposal is necessary to approve it. Abstentions and shares represented at the
meeting but not voted on a particular matter due to a broker's lack of
discretionary voting power are counted for quorum purposes but are not counted
as votes cast for or against a particular matter and thus will not affect the
outcome of the vote on any matter. The election of directors and the approval of
the Employee Stock Purchase Plan are routine matters as to which, under
applicable New York Stock Exchange rules, a broker will have discretionary
authority to vote if instructions are not received from the client at least 10
days prior to the annual meeting. The
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shareholder proposals, if presented, are not routine matters and a broker will
not have discretionary authority to vote on these matters in the absence of
instructions from the client at least 10 days prior to the annual meeting.
ELECTION OF DIRECTORS
Seven directors are to be elected by shareholders to hold office until the next
annual meeting of shareholders and until their successors are elected and
qualify. All nominees are presently serving as directors, and all have consented
to serve if re-elected. The shares represented by the proxies which are received
will be voted FOR the election of the following seven nominees, unless specified
otherwise. If any nominee becomes unable or unwilling to serve prior to the
annual meeting, the board of directors will reduce the number of directors
comprising the board, pursuant to the Company's bylaws, or the proxies will be
voted for a substitute nominee recommended by the board of directors.
INFORMATION CONCERNING NOMINEES
The name, age and principal occupation of each of the nominees and certain
information regarding his business experience are set forth below:
DAVID M. CHAMBERLAIN, 51, CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER OF
GENESCO. Mr. Chamberlain became president and chief executive officer of the
Company in October 1994 and was named chairman in February 1995. He has been a
partner in Consumer Focus Partners, a San Francisco venture capital firm, since
June 1994 and worked there full-time from that date until he assumed the
presidency of Genesco. He was employed by Shaklee Corporation, a manufacturer
and marketer of consumer products, in 1983 as president and chief operating
officer, was elected a director in 1983 and served as chief executive officer
from 1985 until 1993 and chairman from 1989 until May 1994. Prior to 1983 he was
senior vice president and group executive of Nabisco Brands Ltd., Canada. He has
been a director of Genesco since 1989 and is a director of Mrs. Fields Cookie
Company, Inc., Wild Oats Markets, Inc. and Custom Collection Inc. He also serves
as the Chairman of the Board of Trustees of the University of California at San
Francisco and vice chairman of the San Francisco Opera.
W. LIPSCOMB DAVIS, JR., 63, PARTNER, HILLSBORO ENTERPRISES. Mr. Davis has been a
principal of Hillsboro Enterprises, an investment partnership, and of its
corporate predecessor since 1960. He has been a director of Genesco since 1988.
He is also a director of American General Corp., Third National Bank in
Nashville and Thomas Nelson, Inc.
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JOHN DIEBOLD, 68, CHAIRMAN, THE JD CONSULTING GROUP, INC. Mr. Diebold is
chairman of The JD Consulting Group, Inc., a management consulting firm which he
founded in 1954. He has been a director of Genesco since 1969. He is also
chairman of The Diebold Institute for Public Policy Studies, Inc., a foundation,
as well as trustee of a number of universities, public policy groups and
scientific institutions.
HARRY D. GARBER, 66, DIRECTOR. Mr. Garber served as chairman of Genesco from
February 1994 through January 1995, having been a director of the Company since
1976. He was employed by The Equitable Life Assurance Society of the United
States, a major provider of life insurance, health insurance and annuities, from
1950 until June 1993 and served as its vice chairman from 1984 until his
retirement. He also serves on the board of directors of the MBL Life Assurance
Corporation and Howard University.
JOEL C. GORDON, 66, CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER,
SURGICAL CARE AFFILIATES, INC. Mr. Gordon has been chairman of the board of
Surgical Care Affiliates, Inc., an owner and operator of freestanding outpatient
surgical centers, since its founding in 1982 and has served as its chief
executive officer since 1987. Mr. Gordon was a founder and served as president
and vice-chairman of the board of General Care Corp., an owner and operator of
general acute care hospitals, from 1969 until it was sold to Hospital
Corporation of America in 1980. He has been a director of Genesco since June
1992. Mr. Gordon is also a director of Third National Bank in Nashville and
Healthwise of America, Inc.
WILLIAM A. WILLIAMSON, JR., 59, PRIVATE INVESTOR. Mr. Williamson was employed
from 1958 to 1992 by Durr-Fillauer Medical, Inc., a distributor of
pharmaceuticals, drug store sundries and medical, surgical and veterinary
products, and was elected chief executive officer of that company in 1974 and
named as its chairman in 1981. He has been a director of Genesco since 1989. Mr.
Williamson is also a director of AmSouth Bancorporation.
WILLIAM S. WIRE II, 63, RETIRED CHAIRMAN AND CHIEF EXECUTIVE OFFICER OF GENESCO.
Mr. Wire joined the Company in 1962, was elected a vice president in 1971,
senior vice president-finance in 1984 and vice chairman and a director in 1985.
He was elected president and chairman in 1986, served as chief executive officer
from 1986 until January 31, 1993 and retired as chairman on January 31, 1994.
Mr. Wire is also a director of First American Corporation, First American
National Bank and Dollar General Corporation.
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BOARD COMMITTEES AND MEETINGS
The board of directors met twelve times during the fiscal year ended January 31,
1995 ("Fiscal 1995"). No director was present at fewer than 75% of the total
number of meetings of the board of directors and the committees of the board on
which he served during Fiscal 1995. A description of each board committee and
its membership follows.
AUDIT COMMITTEE
Members: Joel C. Gordon (chairman), W. Lipscomb Davis, Jr., Harry D. Garber
(since February 20, 1995) and William A. Williamson, Jr.
The audit committee met four times in Fiscal 1995. The functions of the audit
committee are (i) to serve as the primary means of communication between the
board of directors and both the independent accountants and the corporate
auditor, (ii) to assist and make recommendations to the board of directors in
fulfilling its responsibilities relating to the Company's accounting, financial
reporting and internal accounting control policies and practices, (iii) to
review with the independent accountants and the corporate auditor the scope of
the annual audit plan, the results of the annual audit and the adequacy of the
Company's internal accounting controls, (iv) to make recommendations to the
board of directors with respect to the selection of independent accountants, (v)
to approve the fees payable to the independent accountants, (vi) to review any
non-audit services rendered by the independent accountants, (vii) to monitor
compliance with the Company's business ethics policies and (viii) to engage
independent accountants and other professional advisors to conduct such special
reviews or studies as the committee deems appropriate in fulfilling its
responsibilities.
NOMINATING COMMITTEE
Members: W. Lipscomb Davis, Jr. (chairman), David M. Chamberlain, John
Diebold, Harry D. Garber and William S. Wire II
The nominating committee met three times in Fiscal 1995. The function of the
nominating committee is to make recommendations to the board of directors with
respect to (i) the size of the board of directors, (ii) candidates for election
to the board of directors, (iii) the designation of committees of the board of
directors, their functions and members and (iv) the succession of the executive
officers of the Company. The nominating committee will consider for nomination
as directors qualified nominees recommended by shareholders, who may submit
recommendations to the committee in care of the secretary of the Company, giving
in detail the qualifications and experience of the persons so recommended.
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COMPENSATION COMMITTEE
Members: David M. Chamberlain (chairman and committee member until October 12,
1994), William A. Williamson, Jr. (chairman since October 12, 1994),
Joel C. Gordon and John Diebold
The compensation committee met eight times in Fiscal 1995. The functions of the
compensation committee are (i) to approve the compensation of the officers of
the Company, (ii) to review the salary ranges applicable to other employees of
the Company whose base annual salary is at the rate of $125,000 or more, (iii)
to make recommendations to the board of directors with respect to the
compensation of directors, (iv) to review and provide assistance and
recommendations to the board of directors with respect to (a) management
incentive compensation plans and (b) the establishment, modification or
amendment of any employee benefit plan (as that term is defined in the Employee
Retirement Income Security Act of 1974) to the extent that action by the board
of directors is required, (v) to serve as the primary means of communication
between the administrator of the Company's employee benefit plans and the board
of directors and (vi) to administer the Company's Key Executives Stock Option
Plan, the 1987 Stock Option Plan, the Stock Savings Plan (which, subject to
shareholder approval, will be replaced by the Genesco Employee Stock Purchase
Plan -- see "Approval of Employee Stock Purchase Plan"), and the Restricted
Stock Plan for Directors.
FINANCE COMMITTEE
Members: Harry D. Garber (chairman), Joel C. Gordon, William A. Williamson, Jr.
and William S. Wire II
The finance committee met three times in Fiscal 1995. The functions of the
finance committee are (i) to review and make recommendations to the board with
respect to (a) the establishment of bank lines of credit and other short-term
borrowing arrangements, (b) the investment of excess working capital funds on a
short-term basis, (c) significant changes in the capital structure of the
Company, including the incurrence of long-term indebtedness and the issuance of
equity securities, (d) the declaration/omission of dividends and (e) the annual
capital expenditure and charitable contribution budgets; (ii) to serve as the
primary means of communication between the board of directors and the investment
committee, the trustees of the Genesco Restricted Investments Pension Trust and
the vice president-finance of the Company regarding the activities of such
committee, trustees and officer in respect of certain of the Company's employee
benefit plans (as that term is defined in the Employee Retirement Income
Security Act of 1974)
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and (iii) to appoint, remove and approve the compensation of the trustees under
any employee benefit plan.
DIRECTOR COMPENSATION
Directors who are not employees of the Company receive a retainer of $15,000 a
year and a fee of $750 for each board or committee meeting attended in person or
$500 for each meeting by telephone. Each committee chairman receives an
additional $2,000 a year. Directors who are full-time Company employees do not
receive any compensation for serving as directors. The Company will defer the
payment of all or any portion of a director's fees. Amounts deferred accrue
interest at the prime rate. No director is currently deferring payment of
director's fees. The Company also pays the premiums for directors who are not
employees on $50,000 of coverage under the Company's group term life insurance
policy plus additional cash compensation to offset income taxes imputed to
directors for such premiums.
The Restricted Stock Plan for Directors was approved by shareholders on June 21,
1988. The plan, which provides for issuance of a maximum of 100,000 shares of
common stock, subject to adjustment under certain circumstances, provides for
the issuance to each non-employee director at three-year intervals of shares of
common stock valued at $15,000 (not to exceed 5,000 shares). The shares are
subject to restrictions on transfer and, with certain exceptions, are subject to
forfeiture if the director's service terminates during the three-year period
following the date of issuance. As of April 30, 1995, 87,475 shares of common
stock had been issued pursuant to the plan, of which 9,902 shares had been
forfeited, leaving 22,427 shares available for future grants.
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SECURITY OWNERSHIP OF OFFICERS,
DIRECTORS AND PRINCIPAL SHAREHOLDERS
PRINCIPAL SHAREHOLDERS
The following table sets forth the ownership of persons known to own
beneficially more than 5% of the various classes of voting securities described
on page 3 taken as a single voting group. This information is based upon the
most recent filings of Schedules 13D and 13G and amendments thereto, as
applicable, by the beneficial owners.
<TABLE>
<CAPTION>
CLASS
OF NAME AND ADDRESS NO. OF PERCENT
STOCK OF BENEFICIAL OWNER SHARES OF CLASS
<S> <C> <C> <C>
Common Richard C. Blum & Associates, Inc. (1) 1,358,300 5.6%
Richard C. Blum & Associates, L.P. (1)
The Carpenters Pension Trust for Southern
California (1)
909 Montgomery Street
Suite 400
San Francisco, CA 94133
Common Fisher Investments, Inc. (2) 1,449,900 6.0%
13100 Skyline Boulevard
Woodside, CA 94062
</TABLE>
(1) Shared voting and dispositive power.
(2) Sole voting and dispositive power.
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SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of April 30, 1995 regarding the
beneficial ownership of the Company's common stock by each of the Company's
current directors, the persons required to be named in the Company's summary
compensation table appearing elsewhere in the proxy statement and the current
directors and executive officers as a group. None of such persons owns any
equity securities of the Company other than common stock, except that one
current executive officer not named in the summary compensation table owns 74
shares of Subordinated Preferred Stock.
<TABLE>
<CAPTION>
NO. OF
NAME SHARES(1)
<S> <C>
David M. Chamberlain 357,998 (2)
W. Lipscomb Davis, Jr. 57,326 (3)
John Diebold 15,832
Harry D. Garber 12,326
Joel C. Gordon 151,875 (4)
William A. Williamson, Jr. 59,076
William S. Wire II 197,724 (5)
James S. Gulmi 18,425 (5)(6)
Ben T. Harris 4,835 (5)(7)
Fowler H. Low 15,000 (5)
E. Douglas Grindstaff 274,000
Robert E. Brosky 4,263 (5)(8)
Thomas B. Clark 0
Henry D. Siegal 0
Current Directors and Executive Officers as a Group
(13 Persons) 892,917 (5)(9)
</TABLE>
(1) Each director and officer owns less than 1% of the outstanding shares of the
Company's common stock, except for Mr. Chamberlain, who owns 1.5% of such
shares.
(2) Includes 245,000 shares held by Mr. Chamberlain jointly with his wife, as
trustees of a family trust, and 4,000 shares held by their daughters. Also
includes 100,000 shares which may be purchased within 60 days upon exercise
of options granted in connection with Mr. Chamberlain's election as
president of the Company.
(3) Includes 10,000 shares of common stock owned by Mr. Davis' mother, for whom
he holds power of attorney. Mr. Davis disclaims beneficial ownership of such
shares.
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(4) Includes 10,750 shares owned by Mr. Gordon jointly with his wife and by a
partnership of which Mr. Gordon's children are the general partners and a
total of 105,000 shares held by two trusts for which Mr. Gordon exercises
voting and investment control.
(5) Includes (i) with respect to Messrs. Gulmi, Harris, Low, Wire and Brosky,
10,000, 1,250, 5,000, 181,250 and 4,000 shares, respectively, which may be
purchased within 60 days upon exercise of options granted to them under the
Company's stock option plans and (ii) with respect to all current executive
officers, a total of 18,750 shares which may be purchased within 60 days
upon exercise of options under such plans.
(6) Includes 40 shares held for the benefit of Mr. Gulmi's children by their
mother, of which Mr. Gulmi disclaims beneficial ownership.
(7) Includes 3,500 shares held by Mr. Harris jointly with his wife.
(8) Includes 110 shares held by Mr. Brosky's daughters, of which he disclaims
beneficial ownership.
(9) Constitutes approximately 3.6% of the Company's outstanding common stock.
COMPLIANCE WITH BENEFICIAL OWNERSHIP REPORTING RULES
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors and persons who own more than 10% of a registered class
of the Company's equity securities to file reports of ownership and changes in
ownership with the Securities and Exchange Commission ("SEC"). Such officers,
directors and shareholders are required by SEC regulations to furnish the
Company with copies of all such reports that they file. Based solely on a review
of copies of reports filed with the SEC and of written representations by
certain officers and directors, all persons subject to the reporting
requirements of Section 16(a) filed the required reports on a timely basis.
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EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning compensation from the
Company earned by or awarded or paid to the chief executive officer, the former
chief executive officer and each of the other four most highly compensated
executive officers employed by the Company at January 31, 1995 and two
additional individuals who would have fit the latter category but for the fact
that they were not executive officers of the Company at January 31, 1995
(together, the "named executive officers"), for each of the fiscal years ended
January 31, 1993, 1994 and 1995.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION AWARDS OPTIONS COMPENSATION(1)
POSITION YEAR ($) ($) ($) ($) (#) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
David M. Chamberlain 1995 103,629 0 71,117(2) 15,000(3) 200,000 24,635
Chairman, President 1994 N/A N/A N/A N/A N/A N/A
Chief Executive 1993 N/A N/A N/A N/A N/A N/A
Officer
E. Douglas 1995 349,463 0 0 0 171,84
Grindstaff(4)
President and Chief 1994 500,000 0 0 0 12,067
Executive Officer 1993 333,333 500,000 0 300,000 12,067
James S. Gulmi 1995 206,000 0 0 121,800(5) 0
Vice President- 1994 197,000 0 0 10,000 1,402
Finance 1993 185,750 137,455 0 10,000 1,676
Fowler H. Low 1995 229,500 0 0 101,500(6) 0
President and Chief 1994 218,500 131,100 0 7,000 5,609
Executive Officer, 1993 216,000 148,114 0 7,000 5,609
Johnston & Murphy,
a division of
Genesco
Ben T. Harris 1995 173,750 104,250 0 59,250(7) 0
President, Genesco 1994 161,250 0 0 7,000 1,890
Retail, a division 1993 156,250 93,750 0 7,000 798
of Genesco
Robert E. Brosky(8) 1995 123,000 0 0 46,100(9) 3,575
Controller and 1994 118,556 0 0 3,000 2,288
Chief
Accounting Officer 1993 112,894 56,447 0 3,000 2,288
Thomas B. Clark(10) 1995 174,731 0 0 0 280,825
Executive Vice 1994 20,833 0 0 75,000 N/A
President- 1993 N/A N/A N/A N/A N/A
Administration
Henry D. Siegal(11) 1995 246,458 0 25,526(12) 0 0 165,747
President, The 1994 55,972 0 N/A 0 40,000 N/A
Greif
Companies, a 1993 N/A N/A N/A N/A N/A N/A
division
of Genesco
</TABLE>
(1) The amounts shown in this column reflect the value of amounts paid by the
Company with respect to life insurance policies, except that the amount
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shown for Mr. Chamberlain includes fees paid to him prior to October 12,
1994 as a non-employee director of $24,500 and reimbursement of federal
income taxes on imputed income from director life insurance policy of $135.
$159,109 of the amount shown for Mr. Grindstaff in 1995, and all of the
amounts shown for Mr. Clark and Mr. Siegal, were cash payments made in
connection with the termination of their employment.
(2) Includes reimbursement for personal commuting and Nashville housing
expenses after Mr. Chamberlain became president and chief executive officer
of $35,878 and housing in Nashville of $8,505 and reimbursement of federal
and state taxes on the imputed income from such reimbursements of $35,239.
(3) At January 31, 1995, Mr. Chamberlain held 4,000 shares of common stock
subject to forfeiture if he ceases to be a director of the Company prior to
June 22, 1997, on which date the risk of forfeiture lapses. Based upon the
reported closing price of shares of the Company's common stock on the New
York Stock Exchange on January 31, 1995, the market value of the restricted
shares at year end was $8,500. The shares were granted pursuant to the
Restricted Stock Plan for Directors prior to Mr. Chamberlain's election as
president and chief executive officer.
(4) Mr. Grindstaff resigned effective October 12, 1994.
(5) Includes 81,800 options granted in exchange for an equal number of options
relinquished in the Company's November 1994 option exchange. See "Report on
Repricing of Options/SARs," below.
(6) Includes 56,500 options granted in exchange for an equal number of options
relinquished in the Company's November 1994 option exchange. See "Report on
Repricing of Options/SARs," below.
(7) Includes 19,250 options granted in exchange for an equal number of options
relinquished in the Company's November 1994 option exchange. See "Report on
Repricing of Options/SARs," below.
(8) Mr. Brosky resigned as Controller and Chief Accounting Officer effective
April 30, 1995.
(9) Includes 36,100 options granted in exchange for an equal number of options
relinquished in the Company's November 1994 option exchange. See "Report on
Repricing of Options/SARs," below.
(10) Mr. Clark resigned effective October 12, 1994.
(11) Mr. Siegal resigned effective November 3, 1994.
(12) Includes $23,060 of reimbursements for personal commuting expenses.
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OPTION GRANTS IN FISCAL 1995
The following table sets forth information regarding stock options granted to
the named executive officers in Fiscal 1995 and the potential realizable value
of those options assuming the market price of the Company's common stock
increases at annual rates of 5% and 10%, compounded annually, until they expire
ten years after the date of grant. The potential realizable values shown in the
table are hypothetical, have not been discounted to reflect their present value
and are not intended as a forecast of future stock price appreciation. Any gains
which may be realized upon exercise of such options will depend upon the actual
market price of the Company's common stock on the date the option is actually
exercised.
<TABLE>
<CAPTION>
POTENTIAL
REALIZABLE VALUE
AT ASSUMED ANNUAL
NUMBER OF RATES OF STOCK
SECURITIES % OF TOTAL PRICE
UNDERLYING OPTIONS APPRECIATION FOR
OPTIONS GRANTED TO EXERCISE OPTION TERM
GRANTED EMPLOYEES PRICE EXPIRATION (10 YEARS)
NAME (#) IN FISCAL YEAR ($ PER SHARE) DATE 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C>
David M. Chamberlain 100,000 8.4 2.375 10/12/2004 108,700 314,500
100,000 8.4 1.875 12/21/1999 158,700 364,500
E. Douglas Grindstaff 0 0 N/A N/A N/A N/A
James S. Gulmi 81,800 6.9 2.75 11/3/2004 58,242 226,586
40,000 3.4 2.00 12/7/2004 58,480 140,800
Fowler H. Low 56,500 4.7 2.75 11/3/2004 40,228 156,505
45,000 3.8 2.00 12/7/2004 65,790 158,400
Ben T. Harris 19,250 1.6 2.75 11/3/2004 13,706 53,322
40,000 3.4 2.00 12/7/2004 58,480 140,800
Robert E. Brosky 36,100 3.0 2.75 11/3/2004 25,703 99,997
10,000 .8 2.00 12/7/2004 14,620 35,200
Thomas B. Clark 0 0 N/A N/A N/A N/A
Henry D. Siegal 0 0 N/A N/A N/A N/A
</TABLE>
All stock option grants, other than Mr. Chamberlain's, were made under the
Company's 1987 Stock Option Plan (the "Plan"). The option price per share under
the Plan may not be less than the fair market value of the Company's common
stock (the closing price of the stock on the New York Stock Exchange) on the
date the option is granted or the most recent previous trading date. Plan
options may not be exercised during the first twelve months after the date of
grant. Thereafter, options may be exercised as determined by the compensation
committee of the board of directors. The options listed in the table above which
expire on November 3, 2004 were issued in exchange for options previously issued
under the Plan. See "Report on Repricing of Options/SARs," below. Those
replacing presently exercisable options on the date of the exchange and those
which would have
14
<PAGE>
<PAGE>
become exercisable during the following year will become exercisable on the
first anniversary of the exchange; those replacing other options will become
exercisable on the subsequent anniversary of the exchange next following the
date the replaced options would have become exercisable. The options listed in
the table above which expire on December 7, 2004 will become exercisable in five
equal annual installments beginning on December 7, 1995. Subject to certain
qualifications set forth in the Plan, all options granted under the Plan become
exercisable immediately upon a change in control of the Company of a nature
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934. The term of options
granted under the Plan may not exceed 10 years. All options granted under the
Plan during Fiscal 1995 expire 10 years after the date of grant, subject to
earlier expiration upon termination of employment. A 100,000 share option
granted to Mr. Chamberlain in October 1994 became exercisable April 12, 1995. A
100,000 share option granted in December 1994 will become exercisable on
December 21, 1995 if Mr. Chamberlain remains employed by the Company at that
date.
AGGREGATED OPTION EXERCISES IN FISCAL 1995 AND YEAR-END OPTION VALUES
The following table sets forth information concerning (i) stock options
exercised during Fiscal 1995 by the named executive officers, (ii) the number of
shares subject to unexercised options held by such persons at January 31, 1995,
indicating those currently exercisable and those not yet exercisable and (iii)
the value of such unexercised options on January 31, 1995. The values of
unexercised options are calculated by subtracting the exercise price from the
closing market price of the common stock as quoted on the New York Stock
Exchange on January 31, 1995 ($2.125). In-the-money options are those whose
exercise price is below market value.
<TABLE>
<CAPTION>
SHARES NUMBER OF SHARES VALUE OF UNEXERCISED IN-
ACQUIRED ON UNDERLYING OPTIONS AT THE-MONEY OPTIONS AT
EXERCISE VALUE FISCAL YEAR-END (#) FISCAL YEAR-END ($)
NAME (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C> <C> <C>
David M. Chamberlain 0 0 0 200,000 0 25,000
E. Douglas Grindstaff 0 0 0 0 0 0
James S. Gulmi 0 0 10,000 121,800 0 5,000
Fowler H. Low 0 0 5,000 101,500 0 5,625
Ben T. Harris 0 0 1,250 59,250 0 5,000
Robert E. Brosky 0 0 4,000 46,100 0 1,250
Thomas B. Clark 0 0 0 0 0 0
Henry D. Siegal 0 0 0 0 0 0
</TABLE>
15
<PAGE>
<PAGE>
REPORT ON REPRICING OF OPTIONS/SARS
On November 3, 1994, the compensation committee of the board of directors (the
"Committee") approved the exchange of certain options held by certain executive
officers and other management employees of the Company for new options to become
exercisable over a four-year period while the holder remains employed by the
Company. The following table sets forth certain information concerning the
exchange, which has been the only repricing of options or SARs held by any
executive officer of the Company during the last ten completed fiscal years:
<TABLE>
<CAPTION>
TEN YEAR OPTION/SAR REPRICINGS
MARKET PRICE LENGTH OF
NUMBER OF OF EXERCISE ORIGINAL
SECURITIES STOCK AT PRICE AT OPTIONAL TERM
UNDERLYING TIME OF TIME OF NEW REMAINING
OPTIONS/SARS REPRICING OR REPRICING OR EXERCISE AT DATE OF
REPRICED OR AMENDMENT AMENDMENT PRICE REPRICING OR
NAME DATE AMENDED (#) ($) ($) ($) AMENDMENT
<S> <C> <C> <C> <C> <C> <C>
James S. Gulmi 11/3/94 10,000 2.125 5.50 2.75 9 years
10,000 2.125 9.00 2.75 8 years
10,000 2.125 6.00 2.75 7 years
10,000 2.125 4.75 2.75 6 1/3 years
10,000 2.125 7.75 2.75 4 3/4 years
10,000 2.125 5.375 2.75 4 years
21,800 2.125 5.625 2.75 2 3/4 years
Robert E. Brosky 11/3/94 3,000 2.125 5.50 2.75 9 years
3,000 2.125 9.00 2.75 8 years
4,000 2.125 6.00 2.75 7 years
4,000 2.125 4.75 2.75 6 1/3 years
7,000 2.125 7.75 2.75 4 3/4 years
3,400 2.125 5.375 2.75 4 years
11,700 2.125 5.625 2.75 2 3/4 years
Fowler H. Low 11/3/94 7,000 2.125 5.50 2.75 9 years
7,000 2.125 9.00 2.75 8 years
7,500 2.125 6.00 2.75 7 years
5,000 2.125 4.75 2.75 6 1/3 years
20,000 2.125 7.75 2.75 4 3/4 years
10,000 2.125 5.625 2.75 2 3/4 years
Ben T. Harris 11/3/94 7,000 2.125 5.50 2.75 9 years
7,000 2.125 9.00 2.75 8 years
3,000 2.125 6.00 2.75 7 years
2,250 2.125 7.75 2.75 4 3/4 years
Roger G. Sisson 11/3/94 10,000 2.125 4.625 2.75 9 1/4 years
</TABLE>
The Committee believed that the exchange of options was in the best interests of
the Company and its shareholders. In the view of the Committee, the decline of
16
<PAGE>
<PAGE>
the market price of the Company's common stock to approximately one-third of its
level 12 months earlier, due in part to factors beyond the control of any
individual option holder, and the effect of the erosion of the Company's net
worth as a consequence of a restructuring plan adopted by the board of directors
on November 3, 1994, had substantially impaired the effectiveness of the
existing options as incentives to management's performance. The Committee
further believed that the prospects of significant operating and corporate staff
reductions, coupled with the necessity of concentrated effort to achieve a
successful implementation of the restructuring plan and of strategies to
strengthen the Company's remaining business units, made an enhancement of
incentives for performance by key managers particularly important. The Committee
set the exercise price of the new options at $2.75 per share, approximately 29%
above the closing price of the Company's stock on the New York Stock Exchange on
the effective date of the exchange. The new options will become exercisable in
annual increments: those replacing options exercisable on the effective date of
the exchange and options which would have become exercisable prior to the first
anniversary of the exchange will become exercisable on that anniversary date;
those replacing other options will become exercisable on the anniversary next
following each date on which any of the replaced options would have become
exercisable. The new options expire on the tenth anniversary of their grant date
and otherwise are identical in all material respects to the options they
replaced.
BY THE COMMITTEE:
William A. Williamson, Jr.,
CHAIRMAN
John Diebold
Joel C. Gordon
17
<PAGE>
<PAGE>
PENSION PLAN
The following table shows the estimated annual benefits calculated under the
Genesco Retirement Plan formula at normal retirement (age 65) as a straight life
annuity, disregarding the Internal Revenue Code limitations on annual benefit
payments under the Plan (currently $120,000). The pension benefits shown are not
subject to any deduction for social security or other offset amounts.
<TABLE>
<CAPTION>
10 YEAR AVERAGE 15 20 25 30 35
<S> <C> <C> <C> <C> <C>
$ 125,000 $ 23,722 $ 31,630 $ 39,539 $ 47,446 $ 55,353
150,000 28,973 38,630 48,288 57,946 67,603
175,000 34,224 45,630 57,038 68,446 79,853
200,000 39,475 52,630 65,788 78,946 92,103
225,000 44,725 59,630 74,538 89,446 104,353
250,000 49,977 66,630 83,288 99,946 116,603
300,000 60,479 80,630 100,788 120,946 141,103
350,000 70,981 94,630 118,288 141,946 165,603
400,000 81,483 108,630 135,788 162,946 190,103
450,000 91,985 122,630 153,288 183,946 214,603
500,000 102,487 136,630 170,788 204,946 239,103
</TABLE>
The Genesco Retirement Plan is a noncontributory, qualified pension plan
providing retirement benefits to eligible participants based on a formula which
takes into consideration the average of the 10 highest consecutive years'
earnings of the participant, years of benefit service and other factors. A
participant has no vested rights under the Plan until he has 5 years of service
with the Company.
The years of benefit service of the persons named in the Summary Compensation
Table, other than Messrs. Grindstaff and Siegal who had less than 5 years'
service on their respective termination dates, and Mr. Chamberlain, who has no
years of benefit service, are: James S. Gulmi -- 23 years; Ben T. Harris -- 27
years; Fowler H. Low -- 33 years; Robert E. Brosky -- 32 years and Thomas B.
Clark -- 10 years. The earnings of such persons for purposes of computing
benefits under the Plan are substantially the same as set forth in the Summary
Compensation Table in the salary and annual bonus columns, except that the
Internal Revenue Code limits to $150,000 the amount of a person's annual
earnings which may be taken into account in calculating benefits under the Plan
during the calendar year 1995.
18
<PAGE>
<PAGE>
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
Mr. Grindstaff was employed by the Company under an agreement dated April 22,
1992, as amended December 8, 1993. It provided for a base salary of $500,000 a
year, subject to annual increase at the discretion of the board of directors,
and annual cash incentive bonuses of up to 100% of his annual base salary at the
discretion of the board of directors. Mr. Grindstaff received no bonus with
respect to Fiscal 1995. Under an agreement dated October 12, 1994, entered into
in connection with Mr. Grindstaff's resignation as president and chief executive
officer, the Company agreed to continue his base salary at the then-current
rate, his medical and life insurance coverage and automobile allowance through
April 30, 1996, and to provide certain relocation and outplacement benefits.
Mr. Clark was employed under a three-year agreement, dated December 8, 1993,
which provided for an annual salary of $250,000, subject to annual increase at
the discretion of the compensation committee, and a cash bonus of not less than
$100,000 in each of Fiscal 1995 and 1996. Under an agreement dated October 12,
1994, entered into in connection with Mr. Clark's resignation as executive vice
president-administration, the Company agreed to pay him $22,000 per month and to
continue his medical insurance coverage through July 31, 1996, and to make a
lump-sum severance payment of $200,000. Mr. Clark relinquished his right to
bonus payments and other amounts payable under his employment agreement.
Under an agreement dated April 28, 1995, entered into in connection with Robert
E. Brosky's resignation as controller and chief accounting officer and the
termination of his full-time employment by the Company as of April 30, 1995, the
Company retained Mr. Brosky as a consultant through December 31, 1995, at his
then-current salary and level of benefits, and agreed thereafter to continue his
base salary, subject to offset for earnings from other employment, through April
30, 1996. The Company also agreed to provide outplacement services and to bear
certain transitional costs.
At various times from 1981 to 1994 the Company entered into change of control
agreements with its executive officers and certain other key executives. Among
the named executive officers, Messrs. Gulmi, Low and Harris are currently
parties to such agreements. The agreements become effective only in the event of
a change of control, which will be deemed to have occurred if a person or group
acquires securities representing 25% or more of the voting power of the
Company's outstanding securities or if there is a change in the majority of
directors in a contested election. Each agreement provides for employment by the
Company for
19
<PAGE>
<PAGE>
a term of three years. The executive is to exercise authority and perform duties
commensurate with his authority and duties immediately prior to the effective
date of the agreement. He is also to receive compensation (including incentive
compensation) during the term in an amount not less than that which he was
receiving immediately prior to the effective date. If the executive's employment
is terminated by the Company during the term of the agreement, the executive
will be entitled (i) to continue to receive the compensation provided for under
the agreement, subject to reduction for compensation received in any other
employment during the remainder of the term, or (ii) to elect to receive a
lump-sum severance allowance equal to the present value of the compensation he
would otherwise receive under the agreement for the remainder of the term, but
not to exceed two years.
All stock options granted by the Company become immediately vested and
exercisable upon a change of control as defined in the stock option agreements
entered into with each optionee, provided that at least one year has elapsed
since the date the option was granted. The definition of change of control in
the stock option agreements is substantially the same as in the change of
control agreements described above.
Messrs. Gulmi, Low and Harris and certain other key managers are also parties to
agreements dated as of November 3, 1994, pursuant to which if any of them is
terminated other than for cause prior to January 31, 1996, he will be entitled
to a one-year continuation of his base salary at the termination date, subject
to offset by any earnings from other employment, and to continued coverage under
the Company's health insurance plan through the period mandated by COBRA.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
GENERAL
The compensation committee (the "Committee") of Genesco's board of directors has
general oversight responsibility for the compensation of the Company's executive
officers. See "Election of Directors -- Compensation Committee" for a detailed
description of the functions of the Committee. The Committee is currently
composed of the three directors named at the end of this report, none of whom
are employees of the Company. David M. Chamberlain was a member of the Committee
until he was elected president and chief executive officer of the Company in
October 1994; he did not participate in decisions concerning his own
compensation.
20
<PAGE>
<PAGE>
The compensation policies of the Company are designed to attract and retain
qualified key management personnel and to provide motivation and reward for
achievement of the operating and strategic goals and objectives of the Company.
It is the Company's policy to provide executive officers with the opportunity,
through annual cash incentive compensation, to earn above-average total cash
compensation based on the achievement of outstanding results. The principal
components of Genesco's executive compensation program currently are base
salary, annual cash incentive compensation and stock options.
BASE SALARY
It is the Company's general policy to pay competitive base salaries to its
executive officers. Salary ranges are established for each executive officer's
position, the mid-points of which approximate the median base salary ranges for
positions of similar scope, complexity and responsibility in companies with
comparable sales volume. The Committee annually reviews and, if appropriate,
adjusts executive officers' salary ranges after considering the results of
broad-based salary surveys conducted by nationally-recognized, independent
compensation consultants. The principal survey data upon which the Committee
relies in determining executive officer base salaries and total cash
compensation potential is limited neither to companies in the specific
industries in which the Company competes nor to the companies included in the
S&P weighted average industry index included in the stock performance graph. The
Committee believes that the Company competes with employers outside the specific
industries in which it does business to hire and retain qualified executives. In
making individual base salary decisions, the Committee considers, in addition to
relevant market survey data, (i) the executive's experience, management and
leadership ability and technical skills; (ii) the executive's compensation
history; (iii) corporate or, if appropriate, operating unit performance and (iv)
individual performance.
ANNUAL INCENTIVE COMPENSATION
Executive officers participate in Genesco's annual management incentive
compensation plan, which is designed to retain, motivate and focus the attention
of management on the achievement of the Company's annual operating plan and
identified, strategic objectives. The Committee reviews and makes
recommendations to the board of directors with respect to the adoption of each
year's plan. The board approves the plan annually.
Plan participants are selected by the chief executive officer, who is not
eligible to participate in the plan. All other executive officers and
approximately 65 other management employees participated in the plan for Fiscal
1995; all executive
21
<PAGE>
<PAGE>
officers and approximately 40 other management employees are participants in
Fiscal 1996.
Under the Fiscal 1995 plan, executive officers were eligible to receive bonuses
equal to 30% to 80% of their base salaries. Under the Fiscal 1995 plan, the
amounts of awards payable to participants were based in part (75% for executives
with operating responsibilities and 50% for executives with staff
responsibilities) on the achievement of pre-tax earnings goals of the Company
and, with respect to executives with operating responsibilities, of the business
units in which they were employed. These goals were determined by the chief
executive officer, in his subjective judgment, at the beginning of the year with
reference to the Company's annual operating plan approved by the board of
directors. The remaining portion of the award (25% for executives who have
operating responsibilities and 50% for executives who have staff
responsibilities) was to be based on an assessment, made by the chief executive
officer, of more qualitative or subjective factors such as achievement of
departmental or individual goals and objectives and individual contributions to
the success of the Company, without any weighting of the particular factors.
Achievement of the applicable corporate or business unit goal was a prerequisite
for consideration for this portion of the award, however. Only one of the named
executive officers received a bonus under the Fiscal 1995 plan.
Under the Fiscal 1996 plan, participants who are heads of the Company's
operating divisions are eligible to earn cash awards in amounts to be determined
50% on the basis of earnings and asset utilization goals for their respective
divisions set by the chief executive officer during the first quarter of the
fiscal year, 25% on the basis of earnings and asset utilization goals for the
entire Company and 25% on the basis of individual strategic goals agreed upon by
the participant and the chief executive officer during the first quarter. Other
participants' awards are to be determined 75% on the basis of corporate earnings
and asset utilization goals and 25% on the basis of individual strategic goals
similarly agreed with the chief executive officer. As discussed below,
participants' achievement of earnings and asset utilization goals is objectively
measurable. Specific goals are established by the chief executive officer,
subject to the Committee's approval, based primarily upon the Company's annual
operating plan. Achievement of individual strategic goals is to be determined by
the chief executive officer based upon a year-end review of the participant's
performance.
Applicable earnings and asset utilization goals for each participant are
specified as a range. If the applicable minimum earnings and asset utilization
goals are achieved, the amount of the award earned by the participant is to be
at least 60% of a predetermined target award payable for a specified level of
results within the
22
<PAGE>
<PAGE>
range. The target award does not exceed in any case 35% of the participant's
base salary. Multiples of the award, up to a maximum of six times the target,
are payable for operating results above the target level. No portion of the
award for achievement of individual strategic goals is ordinarily to be paid
unless some portion of the applicable award for operating results is earned,
although the plan authorizes the Committee to make exceptions for extraordinary
strategic successes upon the recommendation of the chief executive officer. An
operating division president may not earn a greater percentage of the maximum
award for corporate earnings and asset utilization goals than he earns for his
business unit's operating results. The Committee may adjust the operating goals
of an individual operating division during the course of the year to reflect
unusual or nonrecurring charges or credits to earnings, changes in accounting
principles and other factors not considered in establishing the goals in
question.
STOCK OPTIONS
The Committee believes that granting stock options to selected key executives of
the Company provides them with a strong incentive to make decisions which are in
the long-term best interests of the Company and, as such, serves to balance the
short-term annual cash incentive component of executive compensation. The
Committee further believes that options tend to align the financial interests of
management with those of the Company's shareholders, since the value of an
option is dependent upon improvement in the Company's performance and in the
recognition of that improved performance in the market for the Company's common
stock. Options are granted with an exercise price equal to or greater than the
fair market value of the stock on the date of grant. Options are typically
granted to executive officers and other key employees on an annual basis and
typically become exercisable in installments of 25% of the total number of
shares subject to the options.
In Fiscal 1995, the Committee granted options to the executive officers and 49
other key management employees in exchange for previously granted options with
exercise prices substantially above the present market price of the stock. The
replacement options have exercise prices at a premium of approximately 29% over
the closing market price at the grant date and will become exercisable over a
four-year period beginning one year from the grant date, in increments
approximating the vesting schedule of the options which they replaced. See
"Report on Repricing of Options/SARs," above.
Additionally, the Committee determined during the latter part of Fiscal 1995
that the Company's interests would be better served by granting a larger number
of options to a smaller number of employees than in the past, thus increasing
the
23
<PAGE>
<PAGE>
significance of the incentive represented by stock options to the group of
employees, identified by the Committee in consultation with the chief executive
officer with input from the heads of the Company's operating divisions, as being
those who in the Committee's subjective judgment are positioned to make the most
direct contribution to the Company's operating results and therefore the
greatest potential impact on the value of its stock. Consistent with this
determination, in December 1994, the Committee approved option grants totaling
532,500 shares to 38 employees (compared to 116,200 shares to 66 employees in
December 1993). To enhance the incentive effect of the awards and to hasten the
implementation of the new strategy, the Committee made individual grants of
larger numbers of options than has been its practice in the past and than it
expects will ordinarily be its practice in the future, and lengthened their
vesting schedule to five years rather than the usual four. Because of the larger
individual awards in Fiscal 1995, the Committee expects to grant options only in
exceptional cases (e.g., new hires and promotions) during Fiscal 1996.
Options granted under the plan expire ten years after the date of grant.
Staggering the vesting of exercise rights requires the executive to remain
employed by the Company for the entire vesting period to realize fully the gain
on the total number of shares covered by the option. A total of 65 employees of
the Company held options to purchase shares of the Company's common stock as of
April 30, 1995.
SEVERANCE ARRANGEMENTS
During last fiscal year and the present one, the Company has entered into
severance arrangements with certain executive officers, including those
arrangements described above under the heading "Employment Contracts,
Termination of Employment and Change in Control Arrangements." The terms of
these arrangements have been influenced by the existing contractual rights of
the executives and management's judgment in individual cases with respect to the
value to the Company of the executive's transitional assistance and cooperation.
CHIEF EXECUTIVE OFFICER COMPENSATION
David M. Chamberlain was elected interim president and chief executive officer
of the Company upon the resignation of E. Douglas Grindstaff from that position
in October 1994. The Committee approved a compensation package for Mr.
Chamberlain including a monthly base salary of $25,000 and reimbursement for
temporary housing in Nashville, reasonable travel expenses to and from his
principal residence in San Francisco and additional federal and state income tax
liability attributable to the housing and travel reimbursements. The Committee
also granted Mr. Chamberlain an option to purchase 100,000 shares of the
Company's
24
<PAGE>
<PAGE>
common stock at $1.875 per share, to become exercisable in April 1995. Mr.
Chamberlain initially agreed to serve for a period of six to nine months during
the search for a permanent chief executive officer. The board of directors later
determined that the implementation of a restructuring plan adopted in November
1994, including the discontinuation of the Company's men's apparel business and
the divestiture of two footwear divisions, as well as significant corporate and
operating staff reductions, required continuity of senior management, and Mr.
Chamberlain agreed to make himself available to the Company as chairman,
president and chief executive officer for at least a year, at the pleasure of
the board. In connection with Mr. Chamberlain's assumption of additional duties
and the agreement to extend his tenure, the Committee raised his monthly salary
to $31,250 and granted an additional 100,000 share option at $2.375 per share,
to become exercisable on December 20, 1995, if Mr. Chamberlain is then employed
by the Company. The Committee believes that Mr. Chamberlain's compensation level
is reasonable in view of the operational and strategic challenges he accepted,
and that the stock options provide him with a meaningful incentive for
performance.
E. Douglas Grindstaff was employed by the Company as president under an
agreement dated April 22, 1992. The agreement, which would have expired on April
30, 1995, provided for a base salary of $500,000 a year, annual cash incentive
bonuses at the discretion of the board of directors, based upon the Company's
operating results during, and its financial condition at the end of, each fiscal
year and on Mr. Grindstaff's individual performance as assessed by the board of
directors in its subjective judgment. Mr. Grindstaff received no bonus with
respect to Fiscal 1995. As described above under the heading "Employment
Contracts, Termination of Employment and Change of Control Arrangements," the
Company entered into a severance agreement with Mr. Grindstaff upon his
resignation in October 1994. The Committee believes that the provisions of the
agreement were in the Company's best interests in view of Mr. Grindstaff's
existing contractual entitlements and the need for the Company to ensure his
assistance and cooperation during the transition to new management.
TAX DEDUCTIBILITY LIMIT
Section 162(m) of the Internal Revenue Code generally provides that certain
compensation in excess of $1 million per year paid to a company's chief
executive officer and any of its four other highest paid executive officers is
not deductible by a company unless the compensation qualifies for an exception.
This deduction limit generally applies only to compensation that could otherwise
be deducted by a company in a taxable year. The Committee has reviewed the
Company's executive compensation plans and believes that no executive officer of
the Company is
25
<PAGE>
<PAGE>
likely to be paid compensation exceeding $1 million in Fiscal 1996. The
Committee will consider the requirements of Section 162(m) in authorizing or
recommending future executive compensation arrangements.
BY THE COMMITTEE:
William A. Williamson, Jr.,
CHAIRMAN
John Diebold
Joel C. Gordon
David M. Chamberlain joins in this Compensation Committee Report with respect to
matters considered by the Committee while he was a member.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
David M. Chamberlain served as a member of the Compensation Committee prior to
his election as president and chief executive officer of the Company in October
1994.
26
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<PAGE>
STOCK PERFORMANCE GRAPH
The graph below compares the cumulative total stockholder return on the
Company's common stock for the last five fiscal years with the cumulative total
return of (i) the S&P 500 Index and (ii) a composite of the S&P Shoes Index and
the S&P Textiles (Apparel Manufacturers) Index. The composite index is weighted
80% shoes and 20% textiles to reflect the approximate division in the Company's
Fiscal 1995 revenues between (i) its footwear businesses and (ii) its tailored
clothing business. The graph assumes the investment of $100 in the Company's
common stock, the S&P 500 Index and the composite index at the market close on
January 31, 1990 and the reinvestment monthly of all dividends.
(GCO Proxy Statement Graph: FY 1995 with plot points appears below)
0
50
100
150
200
250
Jan-90 Jan-91 Jan-92 Jan-93 Jan-94 Jan-95
GCO 100 65 90 165 60 40
S&P 100 110 135 145 160 170
80% Shoe/ 100 140 225 240 170 210
20% Textile
<TABLE>
<CAPTION>
Jan. 90 Jan. 91 Jan. 92 Jan. 93 Jan. 94 Jan. 95
<S> <C> <C> <C> <C> <C> <C>
Genesco Inc. 100.0 64.71 88.24 170.59 64.72 33.33
S & P 500 100.0 108.39 132.99 147.06 166.00 166.88
Composite Index 100.0 134.28 222.79 234.91 175.49 208.11
</TABLE>
27
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<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
William S. Wire II was employed by the Company under an agreement dated January
9, 1993 pursuant to which he served as chairman of the Company at a base salary
of $525,000 a year through January 31, 1994 and agreed to serve thereafter as a
consultant to the Company at the same base annual salary until January 31, 1997.
The Company also agreed to make supplementary retirement benefit payments from
the general funds of the Company to Mr. Wire pursuant to agreements dated
October 18, 1988 and January 9, 1993 in amounts equal to the difference between
the retirement benefits payable under the Genesco Retirement Plan and the
benefits which would have been payable if the Internal Revenue Code limitations
on eligible earnings and maximum payments described above had not been imposed.
The agreements with Mr. Wire further provide that his total annual benefits
under the Plan and his supplementary retirement agreements will not be less than
$260,000. By an agreement dated February 27, 1991, the Company established a
trust for Mr. Wire to be funded in the event of a change of control of the
Company (as defined in the change of control agreements described under the
heading "Agreements with Management" below) through a cash payment by the
Company in actuarially determined amounts required to provide that portion of
the supplementary benefit payments as of the date of the change of control.
Harry D. Garber served as chairman of the Company's board of directors during
Fiscal 1995 under a consulting arrangement pursuant to which he received $12,500
per month (or a total of $150,000 in Fiscal 1995) in addition to the standard
directors' fees and retainer.
APPROVAL OF INDEPENDENT ACCOUNTANTS
The board of directors, upon recommendation of its audit committee, has
appointed Price Waterhouse as independent accountants to examine the financial
statements of the Company and its subsidiaries for the Company's fiscal year
ending January 31, 1996. A representative of Price Waterhouse is expected to be
present at the annual meeting and will be given an opportunity to make a
statement if he so desires and to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS APPOINTMENT AND
YOUR PROXY WILL BE SO VOTED UNLESS YOU SPECIFY OTHERWISE.
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APPROVAL OF EMPLOYEE STOCK PURCHASE PLAN
The board of directors believes that broad-based employee stock purchase plans
advance the interests of the Company and its shareholders by attracting and
retaining qualified employees and by encouraging them to identify with
shareholder interests through the acquisition of shares of the Company's common
stock. The Genesco Employee Stock Purchase Plan (the "Plan") was adopted by the
board of directors on February 20, 1995, subject to the approval of
shareholders. If approved by shareholders, the Plan will replace the Genesco
Stock Savings Plan (the "Existing Plan") approved at the 1990 Annual Meeting of
Shareholders. The following table sets forth certain information regarding the
allocation of benefits from the proposed Plan among the named individuals and
categories of employees:
<TABLE>
<CAPTION>
NEW PLAN BENEFITS
GENESCO EMPLOYEE STOCK PURCHASE
PLAN
NAME AND POSITION DOLLAR VALUE($) NUMBER OF UNITS
<S> <C> <C>
David M. Chamberlain,
Chairman, President and
Chief Executive Officer 0 0
James S. Gulmi,
Vice President-Finance,
Treasurer and Chief Financial
Officer 0 0
Fowler H. Low,
President and Chief Executive
Officer of Johnston & Murphy,
a division of Genesco 0 0
Ben T. Harris,
President and Chief Executive
Officer of Genesco Retail,
a division of Genesco 0 0
Robert E. Brosky,
Controller and Chief
Accounting Officer 0 0
Executive Group 0 0
Non-Executive Director Group 0 0
Non-Executive Officer
Employee Group $ 356,250(1) 1,000,000(1)
</TABLE>
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(1) Not determinable for current year. The information shown assumes the
issuance of the total number of shares issuable under the Plan at September
30, 1994. The dollar value shown is the closing price of the shares on that
date ($2.375) less the amount that would have been required to be paid for
them by Plan participants.
DESCRIPTION OF THE PLAN
Under the proposed Plan, options are to be granted as of October 1, 1995 and
October 1 of every year thereafter, through and including October 1, 2004.
An option enables the participant to purchase shares of the Company's common
stock on the anniversary of the date the option is granted at 85% of the fair
market value of a share of common stock on the date the option is granted or the
date the option is exercised, whichever is lower. The Existing Plan allows for
purchases at the end of a two-year option period at the lower of fair market
value on the grant date or the exercise date. If a participant retires, dies or
becomes disabled, he or his legal representative may withdraw the balance of his
contribution account or receive shares of stock at the exercise date.
A participant enrolling in the Plan specifies the amount of each installment to
be withheld through payroll deductions beginning as soon as practicable after
enrollment. The amount of each installment may not exceed 15% of the
participant's monthly base pay. Amounts withheld under the proposed Plan would
bear no interest. Amounts withheld under the Existing Plan bear interest at the
prime rate.
The number of shares to be purchased is not to exceed the lower of (i) 2,000
shares of common stock or (ii) that number of shares equal to $10,000 divided by
the closing market price of the common stock on the grant date.
The Plan is to be administered by the compensation committee of the board of
directors or another designee of the board of directors.
The board of directors will amend the Plan if necessary to qualify the Plan as
an employee stock purchase plan under Section 423 of the Internal Revenue Code
of 1986, as amended (the "Code"). The board in its discretion may amend the Plan
in other respects, but may not, without shareholder approval, adopt any
amendment which would extend the term of the Plan, materially modify the
employee eligibility requirements or increase the total number of shares of
common stock issuable under the Plan.
All employees of the Company or of any subsidiary of the Company participating
in the Plan, other than employees subject to Section 16(a) of the Securities
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Exchange Act of 1934, including all the executive officers of the Company, will
be eligible to receive options under the Plan, except such an employee (i) who
has been continuously employed for less than 6 full months, (ii) whose eligible
compensation (as defined) exceeded $100,000 in the most recent calendar year,
(iii) whose customary employment is 20 hours or less per week or (iv) whose
customary employment is for not more than 5 months in any calendar year.
Directors are not eligible to participate in the Plan. Eligible employees,
currently approximately 3,350 employees, may enroll as participants in the Plan
annually prior to the date of grant. Executive officers with base salaries of
$100,000 per year or less are eligible to participate in the Existing Plan.
A maximum of 1,000,000 shares of common stock of the Company are available for
grant under the Plan, subject to adjustment resulting from a stock dividend,
split or combination, a recapitalization or reclassification, or a
reorganization, merger or consolidation in which the Company is the surviving
corporation, or other similar change affecting the common stock of the Company.
Any shares as to which an unexercised option expires or is terminated, in whole
or in part, may be subject to a new option.
A participant may withdraw his election to purchase the shares of common stock
issuable under an option up to 30 days prior to the date the option is to be
exercised and receive in cash his entire account balance as of the date of
withdrawal. Thereafter, the participant's payroll deductions will cease.
A participant may discontinue making payroll deductions without withdrawing his
account balance but may not resume making payroll deductions. If the election to
purchase is not subsequently withdrawn, the account balance will be applied to
the purchase of shares on the exercise date.
Each outstanding option is automatically exercised on the last trading date of
the plan year on the New York Stock Exchange, and the balance of the
participant's account is applied to the option price for the purchase of that
number of shares of common stock, rounded to the nearest whole share, equal to
the account balance divided by the option price, not to exceed the maximum
number of shares issuable under the option as provided above. Any remaining
account balance not applied to the purchase of shares may be left in the
participant's account for the purchase of shares in the next plan year or paid
in cash to the participant or the participant's legal representative.
If a participant's employment is terminated for any reason other than his
retirement, death or disability, his participation in the Plan and any
unexercised options automatically terminate, and he will receive in cash the
balance of his account.
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The foregoing description of the principal features of the Plan is qualified by
reference to the full text of the Plan attached as Appendix A to this Proxy
Statement.
FEDERAL INCOME TAX CONSEQUENCES
The Plan is intended to qualify as an employee stock purchase plan under Section
423 of the Code. If a participant makes no disposition of the shares purchased
within two years after the date of the grant or within one year after the date
of exercise of the option, the participant will realize no taxable income upon
the grant of the option or the exercise thereof. If a participant sells or
otherwise disposes of the shares acquired upon the exercise of an option, the
difference between the sales proceeds and the participant's basis in the stock
(i.e., the option price) will be taxed as a long-term capital gain or loss. The
Company is not entitled to a deduction with respect to the granting of an
option, the issuance of shares upon exercise of the option, or upon any
subsequent disposition of the shares by the participant.
If the participant disposes of the shares within two years after the date of
grant or within one year after the date of exercise of the option, the
participant will realize ordinary income in the year of the disqualifying
disposition equal to the difference between the fair market value of the shares
on the date of exercise and the option price. Any balance of the participant's
gain upon disposition will be capital gain. The Company may deduct an amount
equal to the ordinary income recognized by the participant in the year the
participant recognized ordinary income.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE GENESCO EMPLOYEE
STOCK PURCHASE PLAN.
SHAREHOLDER PROPOSALS
CUMULATIVE VOTING
Mr. Joseph Bussetti, 52 South Lilburn Drive, Garnerville, New York, who owns
2,000 shares of Series 1 subordinated serial preferred stock and claims
beneficial ownership of 28,000 shares of common stock, has given notice that he
intends to present the following proposal at the annual meeting:
RESOLVED: That the stockholders of Genesco Inc., at a duly convened annual
meeting, at which a quorum was present in person or by proxy,
hereby request and recommend to the Board of Directors, as a
means of promoting increased shareholder
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democracy, to take the steps necessary to provide for cumulative
voting in the election of directors, which means each stockholder
shall be entitled to as many votes as shall equal the number of
shares he or she owns multiplied by the number of directors to be
elected, and he or she may cast all of such votes for a single
candidate, or any two or more of them as he or she may see fit.
The proponent makes the following statement in support of his proposal:
The proposal relating to cumulative voting for directors should be adopted
by the shareholders for the following reasons:
A major problem in today's corporate world is to make directors and
management of a company more responsive to its shareholders. A recent
example of this was the Paramount-Viacom-QVC battle, where the incumbent
directors of Paramount, until compelled to do so by a court, opposed a
higher offer for Paramount. Cumulative voting for directors is a means of
empowerment for shareholders, giving them greater influence in the
selection of directors, and through the directors, in the management of the
affairs of the company. An editorial in the Corporate Examiner stated:
"Shareholders interested in promoting the democratic process should
encourage corporate management by supporting resolutions which call for the
adoption of cumulative voting."
As explained in the proposed resolution, cumulative voting will have the
effect of enabling shareholders to "cumulate" their votes for one or more
directors rather than having those votes spread among all directors to be
elected.
Making it easier for shareholders to elect as directors someone other than
the slate chosen by management and the incumbent directors can only help
make the Board more responsive to the best interests of all shareholders,
not just those on the inside. It is no coincidence that management will
oppose this resolution on the false argument that each director should
represent all shareholders. The reality is, without cumulative voting, it
is difficult, if not impossible, for outside shareholders to have a voice
on the board.
It is the opinion of the board of directors that each director should represent
the interests of the Company and all of its shareholders. The board opposes
cumulative voting for directors, because in the election of a slate of seven
directors it would make it possible for a shareholder or a group of shareholders
having only a small percentage of the Company's outstanding voting power to
elect a director who might regard himself or herself as representing only the
special interests of those responsible for his or her election. The board
believes that the election of
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directors who view themselves as representing or answerable to a limited group
of shareholders could result in factionalism and discord among directors and
thus impede the effective functioning of the board to the disadvantage of the
Company and its shareholders generally.
The board supports the present method of electing directors by a plurality of
the votes cast, which it believes encourages directors to manage the affairs of
the Company for the benefit of all shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE SHAREHOLDER PROPOSAL, AND
YOUR PROXY WILL BE SO VOTED UNLESS YOU SPECIFY OTHERWISE.
REPEAL OF SHAREHOLDER RIGHTS PLAN
Mr. Ronald R. Bussetti, 12 Carteret Drive, Pomona, New York, who owns 270 shares
of Series 3 preferred stock, 2,000 shares of $2.30 Series 1 preferred stock, 100
shares of employee's convertible preferred stock and 2,900 shares of common
stock and claims beneficial ownership of 515 shares of $2.30 Series 1 preferred
stock and 52,300 shares of common stock, has given notice that he intends to
present the following proposal at the annual meeting:
RESOLVED: That the stockholders of Genesco Inc., at a duly convened annual
meeting, at which a quorum was present in person or by proxy,
hereby request and recommend to the Board of Directors, as a
means of promoting increased shareholder rights and enhancing the
value of the company's stock, to take the steps necessary to
repeal the Shareholders Rights Plan adopted in 1990 or to redeem
such rights.
The proponent makes the following statement in support of his proposal:
The proposal relating to repeal of the Rights Plan should be adopted by the
shareholders for the following reasons:
The Rights Plan has the effect of deterring takeover bids that the Board of
Directors does not consider in the best interest of the company or the
shareholders. The board should focus on making the company profitable and
not on what it might think is in the best interests of shareholders. There
is not any indication that the Rights Plan or other so-called defensive
measures have done anything to protect the shareholders or increase
shareholder value since they were adopted.
The Rights Plan has the effect of artificially deterring a bidder for the
company's stock. It also has the effect of aiding management and the
current
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directors in maintaining their position and control of the company by
requiring a bidder to reach some accommodation with them if the bidder
wants to acquire more than 10% of the company. The Rights Plan also is
based on the false and paternalistic premise that the board and management
are better able to decide what is best for the shareholders rather than the
shareholders themselves.
The Company's Shareholder Rights Plan was adopted by the board of directors to
protect the interests of all the Company's shareholders and to give the board
the flexibility to maximize the value of the shareholders' investment in Genesco
in the event an unsolicited attempt is made to acquire Genesco. Unsolicited
takeover attempts could include a gradual accumulation of shares in the open
market, a partial or two-tier tender offer that does not treat all shareholders
equally, a squeeze-out merger or other abusive takeover tactics. The board
believes these tactics are not in the best interests of shareholders because
they unfairly pressure shareholders, squeeze them out of the investment and
potentially deprive them of the full value of their shares. The Rights Plan
provides a strong incentive for anyone interested in acquiring the Company to
negotiate directly with the board of directors, which is in the best position to
assess the adequacy and fairness of the offer and, if a sale is indicated, to
negotiate the highest possible price for shareholders.
The Rights Plan is not intended to deter and, in the view of the board, will not
deter fair takeover bids for Genesco. It is intended to deter any attempt to
acquire Genesco in a manner or on terms that are not in the best interests of
all shareholders. The board of directors believes that the Rights Plan
represents a sound and reasonable means of addressing the complex issues of
corporate policy that would be presented by a takeover attempt.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE SHAREHOLDER PROPOSAL, AND
YOUR PROXY WILL BE SO VOTED UNLESS YOU SPECIFY OTHERWISE.
CONFIDENTIAL VOTING
The New York City Employees' Retirement System, which claims beneficial
ownership of 66,300 shares of common stock, has given notice that it intends to
present the following proposal at the annual meeting:
RESOLVED: That the shareholders of the corporation request that the board
of directors adopt and implement a policy requiring all proxies,
ballots and voting tabulations that identify how shareholders
voted be kept confidential, except when disclosure is mandated
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by law, such disclosure is expressly requested by a shareholder
or during a contested election for the board of directors, and
that the tabulators and the inspectors of election be independent
and not the employees of the corporation.
The proponent makes the following statement in support of its proposal:
The confidential ballot is fundamental to the American political system.
The reason for this protection is to ensure that voters are not subjected
to actual or perceived coercive pressure. We believe that it is time that
this fundamental principle of the confidential ballot be applied to public
corporations.
Many excellent companies use confidential voting. None have reported any
difficulty reaching quorums or meeting supermajority vote requirements and
those surveyed reported that the added cost of implementing confidentiality
was negligible.
It is our belief that all shareholders need the protection of a
confidential ballot no less than voters in political elections. While we
make no imputation that our company's management has acted coercively, the
existence of this possibility is sufficient to justify confidentiality.
This resolution would permit shareholders to voluntarily disclose their
vote to management by expressly requesting such disclosure on their proxy
cards. Additionally, shareholders may disclose their vote to any other
person they choose. This resolution would merely restrict the ability of
the corporation to have access to the vote of its shareholders without
their specific consent.
Many shareholders believe confidentiality of ownership is ensured when
shares are held in street or nominee name. This is not always the case.
Management has various means of determining actual (beneficial) ownership.
For instance, proxy solicitors have elaborate databases that can match
account numbers with the identity of some owners. Moreover, why should
shareholders have to transfer their shares to nominees in an attempt to
maintain confidentiality? In our opinion, this resolution is the only way
to ensure a secret ballot for all shareholders irrespective of how they
choose to hold their shares.
We believe that confidential voting is one of the most basic reforms needed
in the proxy voting system and that the system must be free of the
possibility of pressure and the appearance of retaliation. We hope that you
would agree and vote FOR this proposal. The General Board of Pension and
Health Benefits of The United Methodist Church, which claims beneficial
ownership of
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2,600 shares of common stock, has notified the Company that it supports and
wishes to be considered a co-filer and co-sponsor of the proposal.
The board of directors believes the Company's present procedure for collecting
and tabulating proxies does not subject the shareholder to coercive pressure and
allows the Company to tabulate votes in an efficient manner. In addition, the
board believes that a secret ballot policy would provide no demonstrable benefit
to the Company or its shareholders and could be a hindrance in situations where
voting information is important.
The proxy solicitation process and the form of proxy itself are governed by the
rules of the Securities and Exchange Commission, and the Company complies with
those rules. Shareholders often utilize their proxy cards to communicate issues
of concern to the Company, and this serves as a valuable source of information
to management. Shareholders desiring to remain anonymous have the freedom of
choice to keep their vote secret by holding their shares in nominee or "street"
name through a broker, bank or depository.
The proponents themselves have acknowledged that there is no imputation of
management coercion and they only speculate that employees or institutional
holders may perceive possible voting pressure. Mere speculation as to the
"existence of this possibility" does not justify the expense of overhauling a
system of voting that has served both the Company and its shareholders well in
the past.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THE SHAREHOLDER PROPOSAL, AND
YOUR PROXY WILL BE SO VOTED UNLESS YOU SPECIFY OTHERWISE.
PROPOSALS FOR THE 1996 ANNUAL MEETING
Proposals of shareholders intended for inclusion in the proxy material for the
1996 annual meeting of shareholders must be received at the Company's offices at
Genesco Park, P.O. Box 731, Nashville, Tennessee 37202-0731, attention of the
Secretary, no later than January 26, 1996.
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APPENDIX A
GENESCO EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I
INTRODUCTION
1.1 ESTABLISHMENT OF PLAN
Genesco Inc., a Tennessee corporation ("Genesco") with principal offices located
in Nashville, Tennessee, adopts the following employee stock purchase plan for
its eligible employees, effective on October 1, 1995, subject to Section 3.1.
This Plan shall be known as the Genesco Employee Stock Purchase Plan.
1.2 PURPOSE
The purpose of this Plan is to provide an opportunity for eligible employees of
the Employer to become shareholders in Genesco. It is believed that broad-based
employee participation in the ownership of the business will help to achieve the
unity of purpose conducive to the continued growth of the Employer and to the
mutual benefit of its employees and shareholders.
1.3 QUALIFICATION
This Plan is intended to be an employee stock purchase plan which qualifies for
favorable Federal income tax treatment under Section 423 of the Code.
ARTICLE II
DEFINITIONS
As used herein, the following words and phrases shall have the meanings
specified below:
2.1 CLOSING MARKET PRICE
The last sale price of the Stock as reported on the New York Stock Exchange on
the date specified or, if no sales occurred on such day, on the most recent day
when sales occurred; but if there should be any material alteration in the
present system of reporting sales prices of such Stock, or if such Stock should
no longer be listed on the New York Stock Exchange, the market value of the
Stock as of a particular date shall be determined in such a method as shall be
specified by the Plan Administrator.
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2.2 CODE
The Internal Revenue Code of 1986, as amended from time to time.
2.3 CONTRIBUTION ACCOUNT
The account established on behalf of a Participant to which shall be credited
the amount of the Participant's contribution, pursuant to Article V.
2.4 EMPLOYEE
Each employee of an Employer (a) whose total annual base salary is less than
$100,000, (b) who is not a Statutory Insider, and (c) whose customary employment
by the Employer is greater than 20 hours per week and greater than five months
per year.
2.5 EMPLOYER
Genesco or any corporation (i) which is a Subsidiary of Genesco, (ii) which is
authorized by the Board of Directors to adopt this Plan with respect to its
Employees, and (iii) which adopts this Plan. The term "Employer" shall include
any corporation into which an Employer may be merged or consolidated or to which
all or substantially all of its assets may be transferred, provided such
corporation does not affirmatively disavow this Plan.
2.6 EXERCISE DATE
The last trading date of the Plan Year on the New York Stock Exchange.
2.7 EXERCISE PRICE
The price per share of the Stock to be charged to Participants at the Exercise
Date, as determined in Section 6.3.
2.8 FIVE-PERCENT SHAREHOLDER
An Employee who owns five percent or more of the total combined voting power or
value of all classes of stock of Genesco or any Subsidiary thereof. In
determining this five percent test, shares of stock which the Employee may
purchase under outstanding options, as well as stock attributed to the Employee
under Section 424(d) of the Code, shall be treated as stock owned by the
Employee in the numerator, but shares of stock which may be issued under options
shall not be counted in the total of outstanding shares in the denominator.
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2.9 GRANT DATE
The first trading date of the Plan Year on the New York Stock Exchange.
2.10 PARTICIPANT
Any Employee of an Employer who has met the conditions for eligibility as
provided in Article IV and who has elected to participate in the Plan.
2.11 PLAN
The Genesco Employee Stock Purchase Plan.
2.12 PLAN ADMINISTRATOR
The committee composed of one or more individuals to whom authority is delegated
by Genesco's board of directors to administer the Plan. The Plan Administrator
shall initially be the Compensation Committee of Genesco's board of directors.
2.13 PLAN YEAR
A 12 month period beginning on the first day of October and ending on the last
day of September in the following calendar year. The initial Plan Year shall
commence on October 1, 1995 and end on September 30, 1996.
2.14 SHARES
Those shares of common stock of Genesco which are reserved pursuant to Section
6.1 for issuance upon the exercise of options granted under this Plan.
2.15 STATUTORY INSIDER
Any individual subject to Section 16(a) of the Securities Exchange Act of 1934,
as amended, and any other person so designated by resolution of the board of
directors.
2.16 SUBSIDIARY
Any corporation in an unbroken chain of corporations beginning with Genesco each
of which (other than the last corporation in the chain) owns stock possessing
50% or more of the combined voting power of all classes of stock in one of the
other corporations in such chain.
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ARTICLE III
SHAREHOLDER APPROVAL
3.1 SHAREHOLDER APPROVAL OF PLAN
If the Plan is not approved by the shareholders of Genesco before October 1,
1995, it shall not take effect.
3.2 SHAREHOLDER APPROVAL FOR CERTAIN AMENDMENTS
Without the approval of the shareholders of Genesco, no amendment to this Plan
shall
(i) increase the number of Shares reserved under the Plan, other than as
provided in Section 10.3;
(ii) make participation in the Plan available to any person who is not an
Employee; or
(iii) make participation in the Plan available to employees or any corporation
other than Genesco or any Subsidiary which adopts the Plan.
Approval by shareholders must comply with applicable provisions of the corporate
charter and bylaws of Genesco, and with Tennessee law prescribing the method and
degree of shareholder approval required for issuance of corporate stock or
options.
ARTICLE IV
ELIGIBILITY AND PARTICIPATION
4.1 CONDITIONS
Each Employee shall become eligible to become a Participant on October 1, 1995
or any October 1 thereafter if such Employee has been employed by the Employer
for a continuous period of at least six months prior to such date. No Employee
who is a Five-Percent Shareholder shall be eligible to participate in the Plan.
Notwithstanding anything to the contrary contained herein, no individual who is
not an Employee shall be granted an option to purchase Shares under the Plan.
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4.2 APPLICATION FOR PARTICIPATION
Each Employee who becomes eligible to participate shall be furnished a summary
of the Plan and an enrollment form. If such Employee elects to participate
hereunder, he shall complete such form and file it with his Employer no later
than the next September 15. The completed enrollment form shall indicate the
amount of Employee contribution authorized by the Employee. If no new enrollment
form is filed by a Participant in advance of any Plan Year after the initial
Plan Year, that Participant shall be deemed to have elected to continue to
participate with the same contribution previously elected (subject to the limit
of 15% of base pay).
4.3 DATE OF PARTICIPATION
All Employees who elect to participate shall be enrolled in the Plan commencing
with the first paydate after the October 1 following their submission of the
enrollment form. Upon becoming a Participant, the Participant shall be bound by
the terms of this Plan, including any amendments whenever made.
ARTICLE V
CONTRIBUTION ACCOUNT
5.1 EMPLOYEE CONTRIBUTIONS
The enrollment form signed by each Participant shall authorize the Employer to
deduct from the Participant's compensation an after-tax amount in an exact
number of dollars during each payroll period which may not be less than five
dollars ($5.00) nor more than 15% of the Participant's base pay on the October 1
on which his enrollment is effective. The term "base pay" shall be determined
before subtracting any of the Employee's contributions to the Genesco 401(k)
plan and the Flexible Spending Accounts Plan. The dollar amount deducted on each
paydate shall be credited to the Participant's Contribution Account. No interest
will accrue on any contributions or on the balance in a Participant's
Contribution Account. The Company's obligations to Participants with respect to
the Contributions under the Plan are unfunded and secured and Participants,
their heirs and Legal Representatives are unsecured general creditors with no
legal rights or claims to any particular assets of the Company.
5.2 MODIFICATION OF CONTRIBUTION RATE
No change shall be permitted in a Participant's amount of withholding except
upon October 1, and then only if the Participant files a new enrollment form
with the Employer at least 15 days in advance of such date designating the
desired
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withholding rate; except that a Participant may notify the Employer at any time
(except during the period from September 15 through September 30) that he wishes
to discontinue his contributions. This notice shall be in writing and on such
forms as provided by the Employer and shall become effective as of a date
provided on the form not more than 30 days following its receipt by the
Employer.
5.3 WITHDRAWAL OF CONTRIBUTIONS
A Participant may elect to withdraw the balance of his Contribution Account at
any time during the Plan Year prior to the Exercise Date (except during the
period from September 15 through September 30). The option granted to a
Participant shall be canceled upon his withdrawal of the balance in his
Contribution Account. The election to withdraw must be in writing on such forms
as may be provided by the Employer. No further contributions may be made with
respect to a Plan Year in which a withdrawal occurs.
ARTICLE VI
ISSUANCE AND EXERCISE OF OPTIONS
6.1 RESERVED SHARES OF STOCK
Genesco shall reserve 1,000,000 Shares for issuance upon exercise of the options
granted under this Plan. Subject to adjustment pursuant to Section 10.3, the
aggregate number of Shares which may be purchased by Participants pursuant to
options granted under the Plan shall not exceed the number of Shares reserved
hereunder. Shares may, however, be originally issued by Genesco or purchased by
Genesco on the open market, in the discretion of the Plan Administrator.
6.2 ISSUANCE OF OPTIONS
On the Grant Date each Participant shall be deemed to receive an option to
purchase a number of Shares at an Exercise Price determined as provided in this
Article VI.
6.3 DETERMINATION OF EXERCISE PRICE
The Exercise Price of the options granted under this Plan for any Plan Year
shall be 85% of the Closing Market Price of the Stock on either the Exercise
Date or the Grant Date, whichever is less.
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6.4 PURCHASE OF STOCK
On an Exercise Date, all of the options which were granted on the previous Grant
Date and which have not subsequently been canceled pursuant to the provisions of
the Plan shall be automatically exercised. The Contribution Account of each
Participant shall be used to purchase the number of whole Shares determined by
dividing the Exercise Price into the balance of the Participant's Contribution
Account. Any money remaining in a Participant's Contribution Account
representing a fractional share shall remain in his Contribution Account to be
used in the next Plan Year along with new contributions in the next Plan Year;
provided, however, that if the Participant does not enroll for the next Plan
Year, the balance remaining shall be returned to him in cash.
6.5 TERMS OF OPTIONS
Options granted under this Plan shall be subject to such amendment or
modification as the Plan Administrator shall deem necessary to comply with any
applicable law or regulation, including but not limited to Section 423 of the
Code, and shall contain such other provisions as the Plan Administrator shall
from time to time approve and deem necessary.
6.6 LIMITATIONS ON OPTIONS
The options granted hereunder are subject to the following limitations:
(a) The maximum number of Shares which may be purchased by any Participant on an
Exercise Date shall be equal to the lesser of
(i) 2,000 shares, or
(ii) $10,000 divided by the Closing Market Price on the Grant Date in that
Plan Year.
The maximum number of Shares as determined above shall be adjusted upon the
occurrence of an event described in Section 10.3.
(b) No option may be granted to a Participant if immediately after the option is
granted the Participant would be a Five-Percent Shareholder.
(c) No Participant may assign, transfer or otherwise alienate any options
granted to him under this Plan, otherwise than by will or the laws of
descent and distribution, and such options may be exercised during the
Participant's lifetime only by him.
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6.7 PRO-RATA REDUCTION OF OPTIONED SHARES
If the total number of Shares to be purchased under option by all Participants
on an Exercise Date exceeds the number of Shares remaining authorized for
issuance under Section 6.1, a pro-rata allocation of the Shares available for
issuance will be made among the Participants in proportion to their respective
Contribution Account balances on the Exercise Date, and any money remaining in
the Contribution Accounts shall be returned to the Participants.
6.8 STATE SECURITIES LAWS
Notwithstanding anything to the contrary contained herein, the Company shall not
be obligated to issue Shares to any Participant if to do so would violate any
State securities law applicable to the sale of Shares to such Participant. In
the event that the Company refrains from issuing Shares to any Participant in
reliance on this Section, the Company shall return to such Participant the
amount in such Participant's Contribution Account that would otherwise have been
applied to the purchase of Shares.
ARTICLE VII
TERMINATION OF PARTICIPATION
7.1 TERMINATION OF EMPLOYMENT
Any Employee whose employment with the Employer is terminated during the Plan
Year for any reason except death, disability or retirement at or after age 65
shall cease being a Participant immediately. The balance of that Participant's
Contribution Account shall be paid to such Participant as soon as practical
after his termination. The options granted to such Participant shall be canceled
as of the date of termination.
7.2 DEATH
If a Participant should die while employed by the Employer, no further
contributions on behalf of the deceased Participant shall be made. The legal
representative of the deceased Participant may elect to withdraw the balance in
such Participant's Contribution Account by notifying the Employer in writing
prior to the Exercise Date in the Plan Year during which the Participant died
(except during the period from September 15 through September 30). In the event
that no election to withdraw is made on or before the September 15 preceding the
Exercise Date, the balance accumulated in the deceased Participant's
Contribution Account shall be used to purchase Shares in accordance with Section
6.4. Any
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money remaining which is insufficient to purchase a whole Share shall be paid to
the legal representative.
7.3 RETIREMENT
If a Participant should retire from the employment of the Employer at or after
attaining age 55, no further contributions on behalf of the retired Participant
shall be made. The Participant may elect to withdraw the balance in his
Contribution Account by notifying the Employer in writing prior to the Exercise
Date in the Plan Year during which the Participant retired (except during the
period from September 15 through September 30). In the event that no election to
withdraw is made on or before the September 15 preceding the Exercise Date, the
balance accumulated in the retired Participant's Contribution Account shall be
used to purchase Shares in accordance with Section 6.4, and any money remaining
which is insufficient to purchase a whole Share shall be paid to the retired
Participant.
7.4 DISABILITY
If a Participant should terminate employment with the Employer on account of
disability, as determined by reference to the definition of "disability" in the
Employer's long-term disability plan, no further contributions on behalf of the
disabled Participant shall be made. The Participant may elect to withdraw the
balance in his Contribution Account by notifying the Employer in writing prior
to the Exercise Date in the Plan Year during which the Participant became
disabled (except during the period from September 15 through September 30). In
the event no election to withdraw is made on or before the September 15
preceding the Exercise Date, the balance accumulated in the disabled
Participant's Contribution Account shall be used to purchase Shares in
accordance with Section 6.4, and any money remaining which is insufficient to
purchase a whole Share shall be paid to the disabled Participant.
ARTICLE VIII
OWNERSHIP OF STOCK
8.1 SHARE OWNERSHIP; FORM
The Shares purchased by a Participant on an Exercise Date shall, for all
purposes, be deemed to have been issued and/or sold at the close of business on
such Exercise Date. Prior to that time, none of the rights or privileges of a
shareholder of Genesco shall inure to the Participant with respect to such
Shares. All
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the Shares purchased under the Plan shall be delivered by the Company in the
manner determined by the Plan Administrator.
The Plan Administrator, in its sole discretion, may determine that the Shares
shall be delivered by (i) issuing and delivering to the Participant a
certificate for the number of Shares purchased by such Participant on an
Exercise Date, (ii) issuing and delivering a certificate or certificates for the
number of Shares purchased by all Participants on an Exercise Date to a member
firm of the New York Stock Exchange which is also a member of the National
Association of Securities Dealers, as selected by the Plan Administrator from
time to time, which Shares shall be maintained by such member firm in separate
brokerage accounts for each Participant, or (iii) issuing and delivering a
certificate or certificates for the number of Shares purchased by all
Participants on an Exercise Date to a bank or trust company or affiliate
thereof, as selected by the Plan Administrator from time to time, which Shares
shall be maintained by such Bank or trust company or affiliate in separate
accounts for each Participant. Each certificate or account, as the case may be,
may be in the name of the Participant or, if the Participant designates on the
form prescribed by the Plan Administrator, in the Participant's name jointly
with another individual, with the right of survivorship. Such designation may be
changed by filing notice thereof.
8.2 PREMATURE SALE OF STOCK
If a Participant (or former Participant) sells or otherwise disposes of any
Shares obtained under this Plan prior to two years after the Grant Date of the
option under which such shares were obtained, that Participant (or former
Participant) must notify the Employer immediately in writing concerning such
disposition.
ARTICLE IX
ADMINISTRATION AND AMENDMENT
9.1 ADMINISTRATION
The Plan Administrator shall (i) administer the Plan and keep records of the
Contribution Account balance of each Participant, (ii) interpret the Plan, and
(iii) determine all questions arising as to eligibility to participate, amount
of contributions permitted, determination of the Exercise Price, and all other
matters of administration. The Plan Administrator shall have such duties, powers
and discretionary authority as may be necessary to discharge the foregoing
duties, and may delegate any or all of the foregoing duties to any individual or
individuals (including officers of Genesco or other Employees who are
Participants). The Board of
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Directors shall have the right at any time and without notice to remove or
replace any individual or committee of individuals serving as Plan
Administrator. All determinations by the Plan Administrator shall be conclusive
and binding on all persons. Any rules, regulations, or procedures that may be
necessary for the proper administration or functioning of this Plan that are not
covered in this Plan document shall be promulgated and adopted by the Plan
Administrator.
9.2 AMENDMENT
The board of directors of Genesco may at any time amend the Plan in any respect,
including termination of the Plan, without notice to Participants. If the Plan
is terminated, all options outstanding at the time of termination shall be
immediately canceled and the balance in each Participant's Contribution Account
shall be paid to that Participant. Notwithstanding the foregoing, no amendment
of the Plan as described in Article III shall become effective until and unless
such amendment is approved by the shareholders of Genesco.
ARTICLE X
MISCELLANEOUS
10.1 EXPENSES
The Employer will pay all expenses of administering this Plan that may arise in
connection with the Plan.
10.2 NO CONTRACT OF EMPLOYMENT
Nothing in this Plan shall be construed to constitute a contract of employment
between an Employer and any Employee or to be an inducement for the employment
of any Employee. Nothing contained in this Plan shall be deemed to give any
Employee the right to be retained in the service of an Employer or to interfere
with the right of an Employer to discharge any Employee at any time, with or
without cause, regardless of the effect which such discharge may have upon him
as a Participant of the Plan.
10.3 ADJUSTMENT UPON CHANGES IN STOCK
The aggregate number of shares of Stock reserved for purchase under the Plan as
provided in Section 6.1, and the calculation of the Exercise Price as provided
in Section 6.3, shall be adjusted by the Plan Administrator (subject to
direction by the board of directors) in an equitable manner to reflect changes
in the capitalization of Genesco, including, but not limited to, such changes as
result from merger,
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consolidation, reorganization, recapitalization, stock dividend, dividend in
property other than cash, stock split, combination of shares, exchange of shares
and change in corporate structure. If any adjustment under this Section 10.3
would create a fractional share of Stock or a right to acquire a fractional
share of Stock, such fractional share shall be disregarded and the number of
shares available under the Plan and the number of shares covered under any
options granted pursuant to the Plan shall be the next lower number of shares,
rounding all fractions downward.
10.4 EMPLOYER'S RIGHTS
The rights and powers of any Employer shall not be affected in any way by its
participation in this Plan, including but not limited to the right or power of
any Employer to make adjustments, reclassifications, reorganizations or changes
of its capital or business structure or to merge or to consolidate or to
dissolve, liquidate or sell, or transfer all or any part of its business or
assets.
10.5 LIMIT ON LIABILITY
No liability whatever shall attach to or be incurred by any past, present or
future shareholders, officers or directors, as such, or Genesco or any Employer,
under or by reason of any of the terms, conditions or agreements contained in
this Plan or implied therefrom, and any and all liabilities of any and all
rights and claims against Genesco, an Employer, or any shareholder, officer or
director as such, whether arising at common law or in equity or created by
statute or constitution or otherwise, pertaining to this Plan, are hereby
expressly waived and released by every Participant as a part of the
consideration for any benefits under this Plan; provided, however, no waiver
shall occur, solely by reason of this Section 10.5, of any right which is not
susceptible to advance waiver under applicable law.
10.6 GENDER AND NUMBER
For the purposes of the Plan, unless the contrary is clearly indicated, the use
of the masculine gender shall include the feminine, and the singular number
shall include the plural and vice versa.
10.7 GOVERNING LAW
The validity, construction, interpretation, administration and effect of this
Plan, and any rules or regulations promulgated hereunder, including all rights
or privileges of any Participants hereunder, shall be governed exclusively by
and in accordance with the laws of the State of Tennessee, except that the Plan
shall be
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construed to the maximum extent possible to comply with Section 423 of the Code
and the Treasury regulations promulgated thereunder.
10.8 HEADINGS
Any headings or subheadings in this Plan are inserted for convenience of
reference only and are to be ignored in the construction of any provisions
hereof.
10.9 SEVERABILITY
If any provision of this Plan is held by a court to be unenforceable or is
deemed invalid for any reason, then such provision shall be deemed inapplicable
and omitted, but all other provisions of this Plan shall be deemed valid and
enforceable to the full extent possible under applicable law.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Notice............................. 1
Voting Securities.................. 3
Election of Directors.............. 4
Security Ownership of Officers,
Directors and Principal
Shareholders..................... 9
Executive Compensation............. 12
Approval of Independent
Accountants...................... 28
Approval of Employee Stock Purchase
Plan............................. 29
Shareholder Proposals.............. 32
Proposals for the 1996 Annual
Meeting.......................... 37
Appendix A......................... A-1
</TABLE>
(GENESCO logo appears here)
NOTICE OF
ANNUAL MEETING
AND
PROXY STATEMENT
Annual Meeting
of Shareholders
June 28, 1995
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