<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
Genesco Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
[GENESCO LOGO]
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 23, 1999, at 10:00 a.m. The agenda will include the following
items:
1. electing nine directors;
2. approving an amendment to the 1996 Stock Incentive Plan; and
3. transacting any other business that properly comes before the meeting.
Shareholders of record at the close of business on April 28, 1999, will be
entitled to vote at the meeting.
By order of the board of directors,
[/s/ ROGER G. SISSON]
Roger G. Sisson
Secretary
May 18, 1999
IMPORTANT
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING. PLEASE SIGN,
DATE AND RETURN THE ENCLOSED PROXY PROMPTLY SO 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> 3
[GENESCO LOGO]
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
WEDNESDAY, JUNE 23, 1999
The board of directors of Genesco Inc. ("Genesco" or the "Company") is
furnishing this proxy statement in connection with its request for proxies to be
voted at the annual meeting of shareholders. The meeting will be held at the
Company's offices at 10:00 a.m. on Wednesday, June 23, 1999. The notice that
accompanies this statement describes the items on the meeting agenda. This proxy
material was first mailed to shareholders on or about May 18, 1999.
The Company will pay the cost of the proxy solicitation. In addition to this
request, officers, directors and regular employees of the Company may solicit
proxies personally and by mail, facsimile or telephone. They will receive no
extra compensation for any solicitation activities. The Company has retained
Georgeson & Co. Inc. to assist in the proxy solicitation. It will pay Georgeson
a fee of $8,500 and reimburse its expenses. The Company will request brokers,
nominees, fiduciaries and other custodians to forward soliciting material to the
beneficial owners of shares and will reimburse the expenses they incur in doing
so.
All valid proxies will be voted as the board of directors recommends, unless the
proxy card specifies otherwise. 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 in person the shares the proxy
represents.
The board of directors does not know of any matter that will be considered at
the annual meeting other than those the accompanying notice describes. If any
other matter properly comes before the meeting, persons named as proxies will
use their best judgment to decide how to vote on it.
The Company's executive offices are located at Genesco Park, 1415 Murfreesboro
Road, Nashville, Tennessee 37217.
<PAGE> 4
VOTING SECURITIES
The various classes of voting preferred stock and the common stock will vote
together as a single group at the annual meeting.
April 28, 1999 was the record date for determining who is entitled to receive
notice of and to vote at the annual meeting. On that date, 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 37,116 1 37,116
$4.75 Series 3 19,369 2 38,738
$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 76,859 1 76,859
Common Stock 22,810,672 1 22,810,672
- ----------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------
</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 the meeting, it is
considered present for quorum purposes for the rest of the meeting. Assuming
enough shares for a quorum, a director will be elected if more votes are cast
for than against election. Abstentions and shares represented at the meeting but
not voted on a particular matter due to a broker's lack of discretionary voting
power ("broker non-votes") will be counted for quorum purposes but not as votes
cast for or against the election of directors. The proposed 1996 Stock Incentive
Plan amendment requires approval by a majority of the Company's issued and
outstanding common stock, because of a provision in the Plan. Consequently,
abstentions and broker non-votes will effectively count as votes against
approval. All the matters on the agenda for the meeting 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.
ELECTION OF DIRECTORS
Nine directors are to be elected at the meeting. They will hold office until the
next annual meeting of shareholders and until their successors are elected and
qualify.
3
<PAGE> 5
All the nominees except Dr. Berry are presently serving as directors and all
have agreed to serve if elected. The shares represented by valid proxies will be
voted FOR the election of the following nominees, unless the proxies specify
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 names, ages and principal occupations of the nominees and certain
information regarding their business experience are set forth below:
LEONARD L. BERRY, Ph.D., 56, Distinguished Professor of Marketing, Texas A&M
University. Dr. Berry has been a professor of marketing at Texas A&M University
since 1982. He is currently Distinguished Professor of Marketing and Director of
the Center for Retailing Studies and holds the J.C. Penney Chair in Retailing
Studies at Texas A&M. He is a director of CompUSA, Inc., Lowe's Companies, Inc.,
Hastings Entertainment, Inc. and the Council of Better Business Bureaus.
DAVID M. CHAMBERLAIN, 55, Chairman of Genesco. Mr. Chamberlain was elected
chairman as of February 1, 1995. Mr. Chamberlain served as president of the
Company from October 1994 until October 1996 and as chief executive officer from
October 1994 until January 1997. In March 1998, he became president, chief
executive officer and a director of L. Kee & Co., a California based textile
importer, and in 1999 became vice chairman of that company. Mr. Chamberlain
joined Shaklee Corporation, a manufacturer and marketer of consumer products, in
1983 as president and chief operating officer, and served as chief executive
officer from 1985 until 1993. He was chairman of Shaklee Corporation from 1989
until May 1994, when he became a partner in Consumer Focus Partners, a
California venture capital firm. He has been a director of Genesco since 1989.
Mr. Chamberlain is also vice chairman of Wild Oats Markets, Inc. and a director
of Picture People, Inc. and Payless Cashways, Inc.
W. LIPSCOMB DAVIS, JR., 67, 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., SunTrust Bank Nashville, N.A.
and Thomas Nelson, Inc.
4
<PAGE> 6
JOEL C. GORDON, 70, Chairman, Cardiology Partners of America. Mr. Gordon was
named chairman of Cardiology Partners of America, a physician practice
management company specializing in cardiology practices on a national basis, in
February 1997. He was chairman of the board of Surgical Care Affiliates from its
founding in 1982 until 1996 and served as its chief executive officer from 1987
until 1996. 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 its sale to Hospital Corporation of America in 1980.
He has been a director of Genesco since 1992. Mr. Gordon is also a director of
Sun-Trust Bank Nashville, N.A., HealthSouth Corporation, Cardiology Partners of
America and Medsynergies Inc.
BEN T. HARRIS, 55, President and Chief Executive Officer of Genesco. Mr. Harris
joined the Company in 1967 and was named manager of the leased department
division of Genesco's Jarman Shoe Company in 1980. In November 1991, he became
president of the Jarman Shoe Company and in December 1994, president of the
Company's retail division. In February 1996, he was named executive vice
president -- operations of the Company. He became president and chief operating
officer in October 1996 and assumed his present position in February 1997.
KATHLEEN MASON, 50, President of the HomeGoods division of The TJX Companies,
Inc. Ms. Mason, who joined Genesco's board in 1996, was named president of the
HomeGoods division of The TJX Companies, Inc., an apparel and home fashion
retailer, in 1997. She was employed by Cherry & Webb, a women's apparel
specialty chain, from 1987 until 1992, as executive vice president, then until
1997 as chairman, president and chief executive officer. Her previous business
experience includes senior management positions with retailers May Company, The
Limited Inc. and the Mervyn's Stores division of Dayton-Hudson Corp.
WILLIAM A. WILLIAMSON, JR., 63, 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 became chief executive officer of that company in 1974 and
chairman in 1981. He has been a director of Genesco since 1989. Mr. Williamson
is also a director of Dunn Investment Company.
WILLIAM S. WIRE II, 67, 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 1993 and retired as chairman in 1994. Mr. Wire
is also a
5
<PAGE> 7
director of First American Corporation, First American National Bank, Dollar
General Corporation and American Endoscopy Service, Inc.
GARY M. WITKIN, 50, Director. Mr. Witkin served as president and chief executive
officer of Service Merchandise Co., Inc., a retailer of jewelry and brand-name
home products from March 1997 until January 1999. Previously, he had been
president and chief operating officer of that company since November 1994. He
was a director and vice chairman of Sak's Fifth Avenue from 1992 until 1994. Mr.
Witkin was elected to Genesco's board in December 1996.
BOARD COMMITTEES AND MEETINGS
The board of directors met seven times during the fiscal year ended January 30,
1999 ("Fiscal 1999"). 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 or she served during Fiscal 1999. A description of each board committee
and its membership follows.
AUDIT COMMITTEE
Members: Joel C. Gordon (chairman), W. Lipscomb Davis, Jr. and Kathleen
Mason
The audit committee met four times in Fiscal 1999. 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 internal audit
function, (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 internal audit function 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 review any non-audit services rendered by the independent accountants,
(vi) to approve the fees payable to the independent accountants, (vii) to
monitor compliance with the Company's legal compliance 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.
6
<PAGE> 8
NOMINATING COMMITTEE
Members: W. Lipscomb Davis, Jr. (chairman), David M. Chamberlain, Ben T.
Harris and William S. Wire II
The nominating committee met two times in Fiscal 1999. 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, (iv) the succession of the executive
officers of the Company and (v) board policies and procedures and other matters
of corporate governance. 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.
COMPENSATION COMMITTEE
Members: William A. Williamson, Jr. (chairman), Joel C. Gordon and Gary M.
Witkin
The compensation committee met four times in Fiscal 1999. 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 1996 Stock Incentive Plan, the
1987 Stock Option Plan and the Employee Stock Purchase Plan.
FINANCE COMMITTEE
Members: David M. Chamberlain (chairman), Ben T. Harris, Kathleen Mason,
William A. Williamson, Jr. and William S. Wire II
The finance committee met four times in Fiscal 1999. The functions of the
finance committee are (i) to review and make recommendations to the board with
respect
7
<PAGE> 9
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 chief financial officer of the Company regarding the activities of such
committee, trustees and officers with respect to certain of the Company's
employee benefit plans (as that term is defined in the Employee Retirement
Income Security Act of 1974) 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 per
year and a fee of $750 for each board or committee meeting they attend in person
and $500 for each meeting they attend by telephone. The chairman of the board
receives an additional monthly retainer of $5,000. Each committee chairman
receives an additional $2,000 a year. The Company also pays the premiums for
non-employee directors on $50,000 of coverage under the Company's group term
life insurance policy plus additional cash compensation to offset taxes on their
imputed income from such premiums. Directors who are full-time Company employees
do not receive any extra compensation for serving as directors.
The 1996 Stock Incentive Plan (the "Plan") provides for the issuance to
directors who are not employees of the Company of up to 100,000 shares of common
stock, subject to adjustment in certain circumstances. The Plan provides for the
automatic issuance of shares of common stock valued at $15,000 to a newly
elected non-employee director on the date of the first annual meeting at which
he or she is elected a director. The Plan also currently provides for common
stock valued at $15,000 to be issued to each non-employee director at three-year
intervals. The shares are subject to restrictions on transfer and, with certain
exceptions, to forfeiture if the director's service terminates during the three
years following the date of grant. The proposed amendment to the Plan would
replace the triennial grant of restricted stock with an annual grant of options
to purchase 4,000 shares of common stock at the stock's closing price on the New
York Stock Exchange on the grant date. See "Approval of Amendment to 1996 Stock
Incentive Plan." The Plan also permits non-employee directors to elect to
exchange all or part of their annual retainers for shares of restricted stock at
75% of fair market
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<PAGE> 10
value. Such shares are subject to restrictions on transfer for five years and to
forfeiture if the director's service terminates before the retainer represented
by such shares is earned. As of April 30, 1999, 27,335 shares of common stock
had been issued to non-employee directors pursuant to the Plan, of which 4,473
had been forfeited, leaving 77,138 shares available for future grants.
9
<PAGE> 11
SECURITY OWNERSHIP OF OFFICERS,
DIRECTORS AND PRINCIPAL SHAREHOLDERS
PRINCIPAL SHAREHOLDERS
The following table sets forth the ownership of the entities which, according to
the most recent filings of Schedule 13G and amendments thereto, as applicable,
by the beneficial owners as of the record date for this meeting, own
beneficially more than 5% of the various classes of voting securities described
on page 3 taken as a single voting group. Percentage data is calculated on
outstanding shares at April 28, 1999.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------
NAME AND ADDRESS CLASS OF NO. OF PERCENT OF
OF BENEFICIAL OWNER STOCK SHARES CLASS
- -----------------------------------------------------------------------------
<S> <C> <C> <C>
EnTrust Capital Inc.(1) Common 2,370,591 10.4%
Eagle Asset Management, Inc.(2) Common 2,353,315 10.3%
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
</TABLE>
(1) Address: 650 Madison Avenue, New York, New York 10022. Number of shares from
Schedule 13G amendment filed on February 9, 1999.
(2) Address: 880 Carillon Parkway, St. Petersburg, Florida 33776. Number of
shares from a Schedule 13G amendment filed on January 29, 1999.
10
<PAGE> 12
SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth information as of April 30, 1999, regarding the
beneficial ownership of the Company's common stock by each of the Company's
current directors, the additional nominee for election as a director, 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.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------
NAME NO. OF SHARES(1)
- -----------------------------------------------------------------------------------
<S> <C>
Leonard L. Berry 1,500
David M. Chamberlain 1,201,498(2)
W. Lipscomb Davis, Jr. 74,384(3)
Joel C. Gordon 53,500(4)
Ben T. Harris 316,149(5)(6)
Kathleen Mason 11,541
William A. Williamson, Jr. 112,813
William S. Wire II 22,532
Gary M. Witkin 3,616
James S. Gulmi 237,541(5)
Fowler H. Low 98,100(5)
Craig E. Michael 25,250(5)
Hal N. Pennington 81,085(5)
Current Directors and Executive Officers as a Group (15
Persons) 2,281,840(5)(7)
- -----------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------
</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 5.3% of such
shares.
(2) Includes 406,167 shares held by Mr. Chamberlain jointly with his wife, as
trustees of a family trust, and 30,000 shares held by their daughters. Also
includes 642,100 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 and under the Company's 1987 Stock Option Plan and
1996 Stock Incentive Plan, and 66,666 restricted shares granted to Mr.
Chamberlain under the 1996 Stock Incentive Plan, which are subject to
transfer restrictions and to forfeiture under certain circumstances, but
which Mr. Chamberlain is entitled to vote.
(3) Includes 16,000 shares of common stock owned by Mr. Davis' mother, for whom
he holds power of attorney and 10,000 shares held by a partnership in which
Mr. Davis exercises investment authority. Mr. Davis disclaims beneficial
ownership of his mother's shares.
11
<PAGE> 13
(4) Includes 10,750 shares owned by Mr. Gordon's wife.
(5) Includes (i) with respect to Messrs. Harris, Gulmi, Low and Pennington,
262,920, 228,156, 78,750, and 50,235 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 654,310 shares which may be purchased within 60 days
upon exercise of options under such plans.
(6) Includes 13,585 shares owned by Mr. Harris jointly with his wife and 1,000
shares held by his daughter, for which Mr. Harris disclaims beneficial
ownership.
(7) Constitutes approximately 10.0% of the outstanding shares of the Company's
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
officers and directors, all persons subject to the reporting requirements of
Section 16(a) filed the required reports on a timely basis.
12
<PAGE> 14
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning compensation earned by or
awarded or paid to the chief executive officer and each of the other four most
highly compensated executive officers employed by the Company at January 31,
1999 (together, the "named executive officers") for each of fiscal 1997, 1998,
and 1999.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION AT FISCAL SALARY BONUS COMPENSATION AWARDS OPTIONS PAYOUTS COMPENSATION
JANUARY 30, 1999 YEAR ($) ($) ($) ($) (#) ($) ($)
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Ben T. Harris 1999 327,246 193,362 -- -- -- 255,451(1) --
President and Chief 1998 325,456 126,140 -- -- 64,420 -- --
Executive Officer 1997 251,477 176,615 -- -- 196,000 -- --
James S. Gulmi 1999 239,500 78,177 -- -- 12,000 -- --
Senior Vice 1998 231,202 52,450 -- -- 36,035 -- --
President -- Finance 1997 221,969 68,745 -- -- 87,071 -- --
and Chief Financial Officer
Fowler H. Low 1999 160,831 489,298 -- -- -- -- --
Employee -- Consultant (Senior 1998 252,257 148,635 -- -- -- -- 75,418(2)
Vice President 1997 251,969 116,500 -- -- 78,250 -- 78,000(2)
until July 31, 1998)
Craig E. Michael 1999 256,872 226,800 -- -- 12,000 -- --
Senior Vice President 1998 200,000 158,940 -- -- 10,000 -- --
1997 181,003 140,715 -- -- 30,000 -- --
Hal N. Pennington 1999 210,872 210,551 -- -- 15,000 -- --
Senior Vice President 1998 195,187 120,243 -- -- 20,650 -- --
1997 141,987 76,318 -- -- 59,585 -- --
- ---------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The value, based on the closing price of the Company's common stock on the
grant date, of a grant of 34,344 shares of stock under a three-year
incentive program. See "Compensation Committee Report on Executive
Compensation -- Chief Executive Officer Compensation."
(2) Lump sum premium payments made pursuant to a 1989 agreement, plus an
additional payment to reimburse federal income taxes payable with respect to
the premiums.
13
<PAGE> 15
OPTION GRANTS IN FISCAL 1999
The following table sets forth information regarding stock options granted to
the named executive officers in Fiscal 1999. All the grants will become
exercisable in four equal annual installments beginning on the first anniversary
of the grant date. They expire on the tenth anniversary of the grant date,
except that they are subject to earlier termination upon termination of the
grantee's employment. No stock appreciation rights were granted by the Company
in Fiscal 1999. 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 RATES OF
NUMBER OF % OF TOTAL STOCK PRICE
SECURITIES OPTIONS APPRECIATION FOR
UNDERLYING GRANTED TO OPTION TERM
OPTIONS EMPLOYEES IN EXERCISE PRICE EXPIRATION 10 YEARS
NAME GRANTED(#) FISCAL YEAR ($ PER SHARE) DATE 5%($) 10%($)
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Ben T. Harris -- -- N/A N/A -- --
James S. Gulmi 12,000 4.5 6.06 8/25/08 45,733 115,897
Fowler H. Low -- -- N/A N/A -- --
Craig E. Michael 12,000 4.5 6.06 8/25/08 45,733 115,897
Hal N. Pennington 15,000 5.6 6.06 8/25/08 57,167 144,871
- -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------
</TABLE>
The stock option grants were made under the Company's 1996 Stock Incentive 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. All the
options will vest and become exercisable upon a change of control as described
under "Employment Contracts, Change of Control Arrangements and Severance
Agreement" below.
AGGREGATED OPTION EXERCISES IN FISCAL 1999 AND YEAR END OPTION VALUES
The following table sets forth information concerning (i) stock options
exercised during Fiscal 1999 by the named executive officers, (ii) the number of
shares subject to unexercised options held by such persons at January 30, 1999,
indicat-
14
<PAGE> 16
ing those currently exercisable and those not yet exercisable and (iii) the
value of such unexercised options on January 30, 1999. The values of unexercised
options are calculated by subtracting the exercise price from the closing market
price of the common stock on the New York Stock Exchange on January 29, 1999
($7.438). In-the-money options are those whose exercise price is below market
value.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF SHARES VALUE OF UNEXERCISED
SHARES UNDERLYING OPTIONS AT IN-THE-MONEY OPTIONS AT
ACQUIRED ON VALUE FISCAL YEAR-END(#) FISCAL YEAR-END($)
NAME EXERCISE(#) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Ben T. Harris -- -- 186,000 134,920 530,012 104,454
James S. Gulmi -- -- 195,871 71,035 775,075 90,515
Fowler H. Low -- -- 82,750 21,500 287,526 79,417
Craig E. Michael 10,250 108,844 6,250 37,500 -- 51,135
Hal N. Pennington 3,000 42,000 50,835 51,150 121,338 55,269
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
PENSION PLAN
The Genesco Retirement Plan is a noncontributory, qualified pension plan. Prior
to December 31, 1995, it provided retirement benefits to eligible participants
based on a formula taking into consideration the average of the 10 highest
consecutive years' earnings of the participant, years of benefit service and
other factors.
Effective January 1, 1996, the Retirement Plan was amended to establish a cash
balance formula. Benefits earned prior to that date under the 10-year average
formula were preserved as of that date. Under the new formula, each eligible
participant's account is credited with an amount equal to 4% of his or her
annual compensation plus an additional 4% of such compensation in excess of the
Social Security taxable wage base ($68,400 in 1998). The Internal Revenue Code
limits to $160,000 the amount of salary which may be taken into account in
calculating Retirement Plan benefits in 1998. Taking into account the preserved
benefit under the Retirement Plan prior to amendment and the projected total
benefit under the amended Retirement Plan, and assuming that the participant's
accrued benefits at normal retirement are taken in the form of a single life
annuity, the estimated annual benefit payable for each named executive officer
at retirement is as follows: Ben T. Harris -- $54,538; James S.
Gulmi -- $72,859, Fowler H. Low -- $73,976, Craig E. Michael -- $21,953 and Hal
N. Pennington -- $59,272.
The years of benefit service of the persons named in the Summary Compensation
Table are: Ben T. Harris -- 31 years; James S. Gulmi -- 27 years, Fowler H.
15
<PAGE> 17
Low -- 36 years, Craig E. Michael -- 22 years and Hal N. Pennington -- 37 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
$160,000 the amount of a person's annual earnings which may be taken into
account in calculating benefits under the Retirement Plan during the calendar
year 1998. A participant has no vested benefits under the Retirement Plan until
he or she has five years' service with the Company.
EMPLOYMENT CONTRACTS, CHANGE OF CONTROL ARRANGEMENTS AND SEVERANCE AGREEMENT
Messrs. Harris, Gulmi and Pennington are parties to employment protection
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 20% 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 a
term of three years following a change of control. 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 actually or constructively terminated by the
Company without cause during the term of the agreement, the executive will be
entitled to receive a lump-sum severance allowance equal in Mr. Harris' case to
three times and in the case of the other named executive officers to twice the
compensation and benefits he would otherwise receive under the agreement for the
remainder of the term, plus reimbursement for any excise tax owed thereon and
for taxes payable by reason of the reimbursement.
All stock options granted by the Company under the Company's stock option plans
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 employment protection agreements described above.
Mr. Michael and the Company are parties to an agreement whereby he resigned as
senior vice president of the Company on January 31, 1999 and left employment by
the Company on March 31, 1999. Under the agreement, he will serve as
16
<PAGE> 18
an exclusive consultant to the Company through April 2000 for a monthly fee
equal to his final monthly salary.
Mr. Low retired from full-time employment with the Company in July 1998. Since
the beginning of Fiscal 1999 he had been assigned to manage the divestiture of
the Company's western boot operations. He was not a participant in the
Management Incentive Compensation Plan for Fiscal 1999, but he received a bonus
of 15% of the amount by which the proceeds of the divestiture and the operating
results of the boot division pending divestiture were better than the
assumptions reflected in the Company's budget for those items. The bonus totaled
$489,298. Mr. Low also assisted the Company in the discontinuation of its leased
men's shoe departments' operations in the former Mercantile Stores Company's
department store chains as a consultant to the Company. Under his current
arrangement with the Company, he is paid a retainer of $50,000 per year.
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.
The compensation policies of the Committee 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.
The Committee also seeks to increase key management's ownership of the Company's
common stock, with the goal of better aligning management's interests with those
of the Company's shareholders. It is the Committee's policy to pay competitive
base salaries and 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 Committee's general policy to approve competitive base salaries for
its executive officers. Salary ranges are established for each executive
officer's posi-
17
<PAGE> 19
tion, 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 advice of senior
management and independent compensation consultants. The principal comparative
data underlying the consultants' advice to the Committee are 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 may consider, in addition to relevant market survey data, a mix of
factors, including (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. While the Committee typically gives greater weight to the
objective, market survey data, the weight to be given to the more subjective
factors in particular cases is within the Committee's discretion.
Incentive Compensation
Executive officers participate in Genesco's management incentive compensation
plan, which is designed to retain and motivate management and to focus its
attention on the achievement of the Company's annual operating plan and
identified, strategic objectives. The Committee reviews and adopts the plan
after consultation with senior management.
Plan participants are selected by the chief executive officer, who is not
eligible to participate in the plan. Approximately 265 management employees
including all executive officers except the chief executive officer participated
in the plan for Fiscal 1999; 309 management employees are participants in Fiscal
2000.
Under the Fiscal 1999 plan, executive officers were eligible to receive a
fraction or multiple of a target award equal to as much as 50% of their base
salaries. Participants who were presidents of the Company's operating divisions
were eligible to earn cash awards in amounts 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 of the fiscal year. Other
participants' awards were deter-
18
<PAGE> 20
mined 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 were
established by the chief executive officer, based primarily upon the Company's
annual operating plan. Achievement of individual strategic goals was 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 were
specified as a range. If the applicable minimum earnings and asset utilization
goals were achieved, the amount of the award earned by the participant was at
least 80% of a predetermined target award payable for a specified level of
results within the range. Multiples of the award were payable for operating
results above the target level. No portion of the award for achievement of
individual strategic goals was ordinarily to be paid unless some portion of the
applicable award for operating results was earned, although the plan authorized
the Committee to consider exceptions for extraordinary strategic successes upon
the recommendation of the chief executive officer. No exceptions of this nature
were made under the Fiscal 1999 plan. An operating division president could not
earn a greater percentage of the maximum award for corporate earnings and asset
utilization goals than for his business unit's operating results. Awards
totaling $1,800,000 and averaging approximately 1.48 times the target were paid
out under the Fiscal 1999 plan.
The plan permitted the Committee to 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. The
Committee determined to exclude the financial results of the Company's leased
men's shoe department operations from the calculation of earnings and asset
utilization achieved by the Company as a whole during Fiscal 1999. During the
second quarter of Fiscal 1999, Dillard's Inc. announced plans to acquire
Mercantile Stores Company, whose men's shoe departments the Company had operated
under a lease arrangement for approximately 40 years. Dillard's Inc. advised the
Company that it would seek to end the lease arrangement after its completion of
the acquisition, and the Company phased down its operations in the leased
departments for the rest of the fiscal year. In deciding to exclude the leased
departments' financial results from the incentive plan calculation, the
Committee took into consideration the fact that the Mercantile acquisition and
the termination of the lease arrangement were beyond management's control. The
Committee also considered management's performance in negotiating withdrawal
arrangements and in operating the leased departments during the transition in a
manner that avoided large
19
<PAGE> 21
operating losses and writedowns of assets. The exclusion of the departments'
financial results made the total bonus payment under the Fiscal 1999 plan
approximately 15% higher than it would otherwise have been.
The Fiscal 2000 plan approved by the Committee refines the prior year plan's
focus on earnings and asset usage by adopting an Economic Value Added (EVA*)
approach to incentive compensation. The Fiscal 2000 plan, like the Fiscal 1999
plan, makes executive officers and other management employees eligible to
receive a fraction or multiple of a predetermined target. The same combinations
of divisional and corporate results and personal performance objectives that
determined individual participants' awards under the prior plan apply to the
Fiscal 2000 plan.
The Fiscal 2000 plan uses EVA as the measure of financial performance of the
Company and its divisions. EVA is determined by subtracting a charge for the
capital used to generate profit from a business unit's net operating profit
after taxes. Each business unit's expected year-to-year change in EVA is
determined in advance, as is the relationship between the magnitude of changes
in EVA relative to expected levels and the bonus award. A significant change in
the Fiscal 2000 plan from prior years is the following described "bonus bank"
feature: Awards for better than expected EVA are uncapped and a "negative award"
for worse than expected results is possible. Any award in excess of three times
the target bonus and any negative award is credited to the participant's account
in the bonus bank. Each year, a participant will receive a payout equal to (i)
the current year's award, up to three times the target plus (ii) one third of
the positive balance, if any, in the participant's account. Any positive balance
is forfeited if the participant voluntarily resigns from employment by the
Company or is terminated for cause. The Committee believes that the "bonus bank"
feature of the plan offers improved incentives for management to focus on
building long-term value in the Company, and that the forfeiture provisions will
aid the retention of key employees.
- ---------------
* EVA is a trademark of Stern Stewart & Co.
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 thus 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
20
<PAGE> 22
option is dependent upon improvement in the Company's performance and 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 1999, the Committee granted a total of 268,000 options to 60
employees. 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 60
employees of the Company held options to purchase shares of the Company's common
stock as of April 28, 1999.
Chief Executive Officer Compensation
Mr. Harris received a base salary of $325,000 and a bonus of $193,362 for Fiscal
1999. The bonus award approved by the Committee was based upon considerations
similar to those underlying the Management Incentive Compensation Plan for the
fiscal year.
In February 1998, the Committee adopted a three-year, stock-based incentive
compensation plan for Mr. Harris pursuant to which Mr. Harris agreed to forego
salary increases and stock option grants during Fiscal 1999, 2000 and 2001. The
resulting gap between his compensation level under the three-year plan and
competitive base salaries and incentive compensation for chief executive
officers of competitive companies for the three-year period -- approximately
$2.4 million, according to the Company's independent compensation
consultants -- will be bridged with annual awards of common stock, contingent on
the achievement of certain defined levels of growth in the Company's revenues
and in its ratio of earnings before interest and taxes to sales. Each year's
award will be multiplied by a factor between .75 and 1.25, based on the
achievement of certain predetermined goals with respect to the Company's ratio
of assets to sales. Mr. Harris may earn a maximum of 300,000 shares,
representing a total of approximately 150% of the gap between competitive
compensation levels and his non-contingent compensation, over the three-year
period. Mr. Harris received a grant of 34,344 shares for Fiscal 1999. For the
reasons discussed above under "Annual Incentive Compensation," the Committee
adjusted the award to exclude the financial results of the Company's leased
men's shoe department operations. The Committee believes that Mr. Harris's
compensation plan reflects a strong commitment on its
21
<PAGE> 23
part and his to the philosophy of pay for performance and that, by focusing on
sales growth, return on sales and efficient asset utilization, the plan should
reward Mr. Harris for achieving goals of real long-term significance to the
Company and its shareholders.
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 likely to be paid compensation not exempt from Section 162(m)
limits exceeding $1 million in Fiscal 2000. 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
Joel C. Gordon
Gary M. Witkin
22
<PAGE> 24
STOCK PERFORMANCE GRAPH
The graph below compares the cumulative total shareholder 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) the S&P Footwear-500. The graph assumes
the investment of $100 in the Company's common stock, the S&P 500 Index and the
S&P Footwear-500 at the market close on January 31, 1994 and the reinvestment
monthly of all dividends.
<TABLE>
<CAPTION>
Measurement Period Footwear- S&P 500
(Fiscal Year Covered) Genesco Inc. 500 Index
<S> <C> <C> <C>
Jan. 94 100 100 100
Jan. 95 51.52 123.16 100.53
Jan. 96 93.94 173.47 139.40
Jan. 97 212.12 329.10 176.12
Jan. 98 293.94 196.81 223.51
Jan. 99 180.32 213.70 296.13
</TABLE>
APPROVAL OF AMENDMENT TO 1996 STOCK INCENTIVE PLAN
Subject to shareholder approval, the board of directors has approved an
amendment to the provisions of the 1996 Stock Incentive Plan covering
stock-based compensation to non-employee directors. The amendment would provide
for an annual grant to each non-employee director of options (the "Director
Options") to purchase 4,000 shares of common stock. It would remove a provision
for the grant at every third annual meeting of shares of restricted stock valued
at $15,000, based on the stock's closing price on the New York Stock Exchange on
the grant date.
23
<PAGE> 25
The Director Options would be granted annually on the date of the annual
meeting, would become exercisable six months after the grant date and would
expire on the earlier of the tenth anniversary of their grant or three months
after the director leaves the board except by reason of death. If a director
died, his or her Director Options would expire on the earlier of the first
anniversary of the date of death or the tenth anniversary of the grant. The
exercise price of the Director Options would be the New York Stock Exchange
closing price on the grant date. On April 28, 1999, that closing price was
$11.25.
The grant of Director Options would have no federal income tax consequences for
the Company or the grantee. Upon exercise, the non-employee director would
realize ordinary income and the Company a deduction equal to the difference
between the market value of the stock underlying the Director Option on the
exercise date and the exercise price of the Director Option.
The following table sets out certain information regarding the benefits or
amounts that would be allocated to certain individuals and groups under the
proposed amendment:
24
<PAGE> 26
NEW PLAN BENEFITS
PROPOSED AMENDMENT TO 1996 STOCK INCENTIVE PLAN
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
NAME AND POSITION DOLLAR VALUE($) NUMBER OF UNITS
- -------------------------------------------------------------------------------
<S> <C> <C>
Ben T. Harris, -0- -0-
President and Chief Executive Officer
James S. Gulmi, -0- -0-
Senior Vice President
Fowler H. Low, -0- -0-
Employee Consultant
Craig E. Michael, -0- -0-
Senior Vice President
Hal N. Pennington, -0- -0-
Senior Vice President
Executive Director Group -0- -0-
Non-Executive Director Group (1) 77,138(2)
Non-Executive Officer -0- -0-
Employee Group
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
</TABLE>
(1) Not presently determinable. Director Options would have an exercise price
equal to the market value of underlying shares at the grant date.
(2) Assuming all remaining shares available for grant to non-employee directors
were granted as Director Options.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE BY THE HOLDERS OF COMMON STOCK FOR THE
PROPOSED AMENDMENT TO THE 1996 STOCK INCENTIVE PLAN, AND YOUR PROXY WILL BE SO
VOTED UNLESS YOU SPECIFY OTHERWISE.
PROPOSALS FOR THE 2000 ANNUAL MEETING
Proposals of shareholders intended for inclusion in the proxy material for the
2000 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 18, 2000.
25
<PAGE> 27
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Notice....................... 1
Voting Securities............ 3
Election of Directors........ 3
Security Ownership of
Officers, Directors and
Principal Shareholders..... 10
Executive Compensation....... 13
Stock Performance Graph...... 23
Approval of Amendment to
1996 Stock Incentive
Plan....................... 23
Proposals for the 2000
Annual Meeting............. 25
</TABLE>
(GENESCO LOGO)
NOTICE OF
ANNUAL MEETING
AND
PROXY STATEMENT
ANNUAL MEETING
OF SHAREHOLDERS
JUNE 23, 1999
<PAGE> 28
APPENDIX
FORM OF PROPOSED AMENDMENT TO 1996 STOCK INCENTIVE PLAN OF GENESCO INC.
Section 9 of the 1996 Stock Incentive Plan of Genesco Inc. is hereby amended to
read in its entirety as follows:
SECTION 9. AWARDS TO OUTSIDE DIRECTORS.
(a) The provisions of this Section 9 shall apply only to awards to
Outside Directors in accordance with this Section 9. The Committee shall have no
authority to determine the timing, terms or conditions of any award under this
Section 9.
(b) On the date of the Annual Meeting of Shareholders at which an
Outside Director is elected as an Outside Director for the first time, such
Outside Director will receive and on the date of the 1997 Annual Meeting of
Shareholders of the Corporation, each Outside Director will receive an automatic
grant of restricted stock pursuant to this Section 9 (the "Outside Directors
Restricted Stock") in a number of shares of stock which will be determined by
dividing:
(i) $15,000 by
(ii) the average of the daily closing prices of the Stock for the first
five (5) trading days of the month in which the Annual Meeting is held
(as reported in The Wall Street Journal), rounding up or down any
fractional share of Stock to the nearest whole share.
(c) The Outside Director Restricted Stock shall vest as follows:
(i) At the first Annual Meeting of Shareholders following the Annual
Meeting at which the Outside Director Restricted Stock was granted, if
the grantee is still serving as a director of the Corporation, the
Outside Director Restricted Stock shall vest with respect to one-third
of the shares of the Outside Director Restricted Stock;
(ii) At the second Annual Meeting of Shareholders following the Annual
Meeting at which the Outside Director Restricted Stock was granted, if
the director is still serving as a director of the Corporation, the
Outside Director Restricted Stock shall vest with respect to one-half
of the remaining shares of the Outside Director Restricted Stock; and
(iii) At the third Annual Meeting of Shareholders following the Annual
Meeting at which the Outside Director Restricted Stock was granted, if
the director is still serving as a director of the Corporation, the
Outside Director Restricted Stock shall vest with respect to the
remaining shares of Outside Director Restricted Stock.
(d) By written notice to the Secretary of the Corporation given at
least six months prior to the end of a fiscal year, an Outside Director may
elect irrevocably to receive all or a specified portion of his annual retainers
for board membership and any committee chairmanship for the following fiscal
year in a number of shares of restricted stock (the "Retainer Stock") determined
by dividing the total amount of retainer specified in the election by 75% of the
1
<PAGE> 29
average of the daily closing prices of the Stock on the New York Stock Exchange
(as reported in The Wall Street Journal) for the last five trading days of the
fiscal year in which the election was made. Shares of the Retainer Stock shall
be granted as of the first business day of the fiscal year as to which the
election is effective, subject to forfeiture to the extent not earned upon the
Outside Director's ceasing to serve as a director or committee chairman during
such fiscal year.
(e) Until the earlier of (i) five years from the date of grant and (ii)
the date on which the Outside Director ceases to serve as a director of the
Corporation (the "Outside Director Period of Restriction"), no Outside Director
Restricted Stock or Retainer Stock may be sold, transferred, pledged, assigned,
or otherwise alienated or hypothecated, otherwise than by will or by the laws of
descent and distribution.
Each certificate representing Outside Director Restricted Stock and
Retainer Stock granted pursuant to this Section 9 shall bear the following
legend:
"The sale or other transfer of the shares represented by
this certificate, whether voluntary, involuntary, or by operation
of law, is subject to certain restrictions on transfer set forth
in the Genesco Inc. 1996 Stock Incentive Plan (the "Plan"), and
rules of administration adopted pursuant to such Plan. A copy of
the Plan and the rules of such Plan may be obtained from the
Secretary of Genesco Inc."
Once the Outside Director Period of Restriction has lapsed, the grantee shall be
entitled to have the legend required by this Section 9 removed from such stock
certificate(s); provided however, that such certificate shall be subject to any
legend required by applicable state or federal law.
(f) From the date on which the Outside Director Restricted Stock and
Retainer Stock is granted, grantees awarded such Stock may exercise full voting
rights with respect to the Outside Director Restricted Stock and Retainer Stock.
(g) Grantees holding Outside Director Restricted Stock or Retainer
Stock that has vested in accordance with Section 9(c) or (d) hereof shall be
entitled to receive all dividends and other distributions paid with respect to
such shares of Stock while they are so held. If any such dividends, or
distributions are paid in Stock, such shares of Stock shall be subject to the
same restrictions on transferability as the shares of Outside Director
Restricted Stock or Retainer Stock with respect to which they were paid.
(h) Annually on the date of the Annual Meeting of Shareholders of the
Corporation, each Outside Director shall receive the automatic grant of options
(the "Outside Director Stock Options") to purchase 4,000 shares of Common Stock
at an exercise price equal to the Fair Market Value of the Common Stock on the
date of grant. The Outside Director Stock Options shall become exercisable six
months after their respective dates of grant, and shall expire at 11:59 p.m.
Nashville, Tennessee, time on the tenth anniversary of their respective dates of
grant. They may be exercised by giving written notice of exercise, accompanied
by payment in full of the exercise price, either by check or by wire transfer of
funds. The Outside Director Stock
2
<PAGE> 30
Options shall not be transferable except by will or by the laws of descent and
distribution. In the event of the death of an Outside Director holding Outside
Director Stock Options, they may thereafter be exercised, to the extent they
were exercisable at the time of death, by the legal representative of the estate
or by the legatee under the will of the Outside Director, for a period of one
year after the date of death or until their earlier expiration, whichever period
is shorter. If an Outside Director ceases to serve on the Board of Directors for
any reason other than death, the Outside Director's Outside Director Stock
Options may thereafter be exercised, to the extent they were exercisable at the
date on which the holder's service terminated, for a period of three months
after such date or until their earlier expiration, whichever period is shorter.
(i) All restrictions imposed on the Outside Director Restricted Stock
and Retainer Stock shall expire and all Outside Director Stock Options shall
vest automatically upon a Change in Control, but the Outside Director Restricted
Stock, the Retainer Stock and the Outside Director Stock Options shall not
otherwise be subject to Section 10 hereof.
(j) All shares of Outside Director Restricted Stock and Retainer Stock
and all Outside Director Stock Options which have not vested in accordance with
Section 9(c), (d) or (h), as applicable, at the time of a grantee's resignation,
removal or failure to be elected as a member of the Board of Directors shall be
forfeited and such forfeited shares shall again be available for award
hereunder.
(k) The Board may not amend or alter this Section 9, except as provided
in Section 11, without the approval of the holders of a majority of the issued
and outstanding shares of Common Stock, and in no event shall this Section 9 be
amended more than once every six months, other than to comply with changes in
the Code or the Employee Retirement Income Security Act of 1974, as amended, or
the regulations thereunder.
3
<PAGE> 31
PROXY
GENESCO INC.
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
THE COMPANY FOR ANNUAL MEETING JUNE 23, 1999
The undersigned hereby constitutes and appoints David M. Chamberlain, Ben T.
Harris, and W. Lipscomb Davis, Jr., and each of them, his true and lawful agents
and proxies with full power of substitution in each, to represent the
undersigned at the Annual Meeting of Shareholders of GENESCO INC. to be held on
June 23, 1999, and at any adjournments thereof, on all matters coming before
said meeting.
CHANGE OF ADDRESS: (Comments)
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(If you have written in the above space, please mark in the corresponding box on
the reverse side of this card)
You are encouraged to specify your choice by marking the appropriate boxes, SEE
REVERSE SIDE. You need not mark any boxes if you wish to vote in accordance with
the Board of Directors' recommendations, though you must sign and return this
card if you wish your shares to be voted.
[SEE REVERSE SIDE]
<PAGE> 32
Please mark your
[X] votes as in this
example.
<TABLE>
<CAPTION>
This proxy when properly executed will be voted in the manner directed herein. If no direction is made, this proxy
will be voted FOR each of the proposals referred to below.
The Board of Directors recommends a vote FOR all proposals.
<S> <C> <C> <C> <C> <C> <C> <C>
FOR WITHHELD FOR AGAINST ABSTAIN
1. Election of [ ] [ ] Nominees:
Directors L. L. Berry, D.M. Chamberlain, W. L. Davis, Jr., 2. Approval of Amendment to [ ] [ ] [ ]
B. T. Harris, K. Mason, J.C. Gordon, 1996 Stock Incentive Plan
W. A. Williamson, Jr., W.S. Wire II and
G. M. Witkin
For, except vote withheld from the nominee(s) indicated below. Change of
Address/ [ ]
Comments on
Reverse Side
______________________________________________________________
By signing, you revoke all proxies heretofore given.
PLEASE MARK, SIGN, DATE, AND RETURN THIS PROXY
CARD PROMPTLY USING THE ENCLOSED ENVELOPE.
SIGNATURE(S)___________________________________________________________________________ DATE _____________________________
Note: Please sign exactly as name appears hereon. Joint owners should each sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If signer is a corporation, please sign full corporate
name by duly authorized officer.
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