<PAGE> 1
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:
/ / Preliminary Proxy Statement
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Angelica Corporation
----------------------------------------------------
(Name of Registrant as Specified In Its Charter)
Angelica Corporation
----------------------------------------------------
(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:_/
---------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------
_/ 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.:
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3) Filing Party:
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4) Date Filed:
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<PAGE> 2
A N G E L I C A
C O R P O R A T I O N
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 24, 1994
The Annual Meeting of Shareholders of Angelica Corporation will be
held at the Saint Louis Club, 14th Floor, 7701 Forsyth Boulevard,
Clayton, Missouri, on Tuesday, May 24, 1994 at 10:00 a.m. local time,
for the following purposes:
1. To elect three Directors for terms expiring at the 1997 Annual
Meeting, and one Director for a term expiring in 1996, or until
their successors have been duly elected and qualified.
2. To adopt and approve the Angelica Corporation 1994 Performance
Plan.
3. To approve the material terms of the criteria to be used in the
grant of performance awards and performance-based restricted stock
awards under the Angelica Corporation 1994 Performance Plan.
4. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The record date for determining shareholders entitled to notice of
and to vote at the meeting is April 4, 1994.
By Order of the Board of Directors
JILL WITTER, Secretary
April 15, 1994
424 South Woods Mill Road
Chesterfield, Missouri 63017-3406
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING IN PERSON, PLEASE SIGN
AND DATE THE ACCOMPANYING PROXY AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE.
<PAGE> 3
A N G E L I C A
C O R P O R A T I O N
PROXY STATEMENT
Angelica Corporation (the "Company") has furnished this Proxy
Statement to its shareholders in connection with a solicitation of
proxies by the Company's Board of Directors. The proxies solicited are
to be used at the Company's Annual Meeting of Shareholders on May 24,
1994, for the purposes described in the accompanying Notice of Annual
Meeting of Shareholders.
Shares represented by a properly completed and returned proxy will be
voted in accordance with the shareholder's directions on the proxy. If
no directions are given on the proxy, the shares will be voted as
recommended by the Board of Directors. A proxy may be revoked at any
time before it is voted by giving written notice to the Company's
Secretary, by executing a later dated proxy or by appearing in person
at the meeting and so advising the inspectors of the voting.
This Proxy Statement and the accompanying proxy were mailed to
shareholders on or about April 15, 1994.
GENERAL INFORMATION
The only securities entitled to vote at the meeting are the
outstanding shares of the Company's Common Stock (the "Common Stock")
and the Series 1 Class A Preferred Stock. As of April 4, 1994, the
record date for the Annual Meeting, there were 9,099,457 shares of
Common Stock and 128 shares of Series 1 Class A Preferred Stock
outstanding, which shares vote as a single class on the matters to be
considered.
Each shareholder is entitled to one vote per share on each matter to
be considered at the meeting. Shares subject to abstentions will be
treated as shares that are represented at the 1994 Annual Meeting for
purposes of determining the presence of a quorum and as voted for
purposes of determining the approval of the shareholders on a
particular proposal unless otherwise stated in the disclosure regarding
such proposal. Shares for which a broker indicates it has no
discretionary authority to vote and which are not otherwise voted by
such broker on a routine matter or matters requiring no prior
authorization or direction of the beneficial owner will not be
considered represented at the 1994 Annual Meeting for purposes of
determining the presence of a quorum or the approval of the
shareholders on a particular proposal. Shares that are voted by a
broker on a routine matter but for which such broker has no
authorization or direction to vote on a nonroutine matter will be
considered as represented at the meeting for the determination of a
quorum but as not represented or voting for purposes of determining
shareholder approval on such nonroutine matter.
1. ELECTION OF DIRECTORS
The Company's Board of Directors consists of eight members classified
into two groups of three members each and one group of two members.
Three Directors will be elected to serve three-year terms expiring in
1997, or until their successors are elected and qualified. James E.
Stefoff retired from the Board, effective as of January 31, 1994 and
Martin Sneider was elected a Director to fill the vacancy created. The
Company's By-Laws provide that a vacancy may be filled until the
successor or successors are elected at the next shareholders meeting
for the purpose of serving the remainder of the unexpired term. The
Nominating Committee has recommended, and the Board has nominated,
Martin Sneider for election to serve the remainder of the unexpired
term of James E. Stefoff which will expire in 1996, or until his
successor is elected and qualified. On February 22, 1994, Robert L.
Virgil submitted his resignation from the Board of Directors, citing
personal reasons. The Board voted to amend the Company's By-Laws to
reduce the number of Directors from nine to eight. Unless authority to
vote is withheld, proxies will be voted for the election of all of the
nominees listed below, each of whom is presently a member of the Board.
The three nominees to the terms expiring in 1997 who receive the
highest total number of votes cast will be elected as Directors.
Likewise, the nominee to the term expiring in 1996 who receives the
highest total number of votes cast will be elected as a Director to
serve such term. Should any nominee become unavailable for any reason
before the meeting, proxies will be voted for a substitute person to be
selected by the Board of Directors unless the Board elects to reduce
the number of Directors.
2
<PAGE> 4
INFORMATION ABOUT NOMINEES FOR DIRECTORS
THREE-YEAR TERMS EXPIRING IN 1997
LESLIE F. LOEWE* - Chairman Emeritus since November 1, 1990, Chairman
of the Board from 1984 to November 1, 1990 and Chief Executive Officer
of the Company from 1980 until November 1, 1989. Director: Medicine
Shoppe International, Inc.; Director of the Company since 1980; Age 72.
ELLIOT H. STEIN* - Chairman Emeritus of Stifel Financial Corp.
(financial holding company) since 1988 and Chairman of the Board from
1986 to 1988. Director: D & K Wholesale Drug, Inc., GenCare Health
Systems, Inc., General Dynamics Corp., and West Indies Sugar Company;
Director of the Company since 1958; Age 75.
WILLIAM P. STIRITZ - President, Chief Executive Officer and Chairman of
the Board of Ralston Purina Company (producer of pet foods, fresh baked
products and batteries, as well as other consumer food products).
Director: Ball Corporation, Boatmen's Bancshares, Inc., The May
Department Stores Company and Reinsurance Group of America; Director of
the Company since 1983; Age 59.
TERM EXPIRING IN 1996
MARTIN SNEIDER - President of Edison Brothers Stores, Inc. since 1987
and a member of its Board of Directors since 1978. Director of the
Company since January, 1994; Age 51.
INFORMATION ABOUT DIRECTORS CONTINUING IN OFFICE
THREE-YEAR TERMS EXPIRING IN 1996
EARLE H. HARBISON, JR. - Chairman of Harbison Walker, Inc.
(manufacturer of molded plastic containers) since October, 1993. Mr.
Harbison retired from Monsanto Company where he had been a member of
the Board of Directors since 1986, Chairman of the Executive Committee
from January to September, 1993, and President and Chief Operating
Officer from 1986 to January, 1993. Director: Merrill Lynch and Co.;
Director of the Company since 1986; Age 65.
LEE M. LIBERMAN* - Chairman Emeritus of Laclede Gas Company (gas public
utility) since February, 1994. Mr. Liberman also served as Chairman of
the Board of Laclede from 1976 through January, 1994 and as Chief
Executive Officer from 1976 to July, 1991. Director: Boatmen's
Bancshares, Inc., CPI Corp., Falcon Products, Inc., Insituform Mid-
America, Inc., and Interco Incorporated; Director of the Company since
1978; Age 72.
THREE-YEAR TERMS EXPIRING IN 1995
H. EDWIN TRUSHEIM - Chairman of the Board of General American Life
Insurance Company since 1986. Mr. Trusheim also served as Chairman of
the Board and Chief Executive Officer of General American Life
Insurance Company from 1986 to May, 1992. Director: GenCare Health
Systems, Inc., Laclede Gas Company, RehabCare Corporation, Reinsurance
Group of America, and Venture Stores, Inc.; Director of the Company
since 1980; Age 66.
LAWRENCE J. YOUNG - Chairman of the Board, President and Chief
Executive Officer of the Company. Mr. Young has served as Chairman of
the Board since November 1, 1990, Chief Executive Officer since
November 1, 1989, and President since 1988. He was Chief Operating
Officer from 1988 to November 1, 1989. Director: Venture Stores, Inc.
and Boatmen's National Bank of St. Louis; Director of the Company since
1988; Age 49.
[FN]
- -----
*The Company's By-Laws provide that a nominee may not stand for
election as a Director if he is age 72 or older and that if a Director
attains his 72nd birthday prior to the expiration of his term, he
shall serve until the next Annual Meeting at which time his office as
Director shall automatically become vacant, except that a majority of
the Directors may vote to waive the age requirement. Such action has
been taken with respect to Mr. Loewe, Mr. Liberman and Mr. Stein.
3
<PAGE> 5
COMPENSATION OF DIRECTORS AND OTHER INFORMATION CONCERNING THE BOARD
AND ITS COMMITTEES
Employee Directors receive no additional compensation for service on
the Board of Directors or its committees. Directors who are not
employees of the Company were paid during the fiscal year ended January
29, 1994, an annual fee of $14,000 plus $900 for each Board meeting
attended, $400 for each telephonic Board meeting and $600 for each
Committee meeting in which he participated. Fees were increased
effective March 16, 1994 as follows: Annual fee, $16,000; Board meeting
fee, $1,000; Telephone meeting fee, $450; and Committee meeting fee,
$700.
Pursuant to the Non-Employee Directors Stock Plan, each non-employee
Director receives 100 shares of Common Stock of the Company each year.
In addition, new non-employee Directors will receive, upon their
election, 400 shares of Common Stock. Directors have full dividend and
voting rights with respect to stock granted pursuant to the plan;
however, stock granted under the plan is forfeitable until earned out
pursuant to a schedule based upon years of participation in the plan
and the Director's age at the time of entering the plan. The plan
terminates on July 24, 1994, unless extended by the Board. All non-
employee Directors participate, except for Mr. Loewe.
All Directors participate in either the Deferred Compensation Option
Plan for Directors or the Deferred Compensation Option Plan for
Selected Management Employees. Directors may defer $5,000 to $10,000 of
fees annually for a period of years, not to exceed four, after becoming
a participant. In consideration of the compensation deferred, and
subject to certain conditions, participants are entitled to receive
supplemental retirement or survivor benefit payments over a 15-year
period. The amount of such benefit is related to the amount of
compensation deferred and certain actuarial factors.
The Board of Directors has standing Audit, Compensation and
Organization, and Nominating Committees. All members of the Audit, the
Compensation and Organization and the Nominating Committees are non-
employee Directors.
The Audit Committee consists of three Directors: Lee M. Liberman
(Chairman), Earle H. Harbison, Jr., and H. Edwin Trusheim. During the
last fiscal year the Committee held four meetings. The Committee's
principal functions are: to recommend to the Board the employment of
the Company's independent auditors; to approve the scope of the
auditors' work and to review the results of that work; to review with
management and the auditors the Company's quarterly and annual results;
to review and approve the auditors' fees; to review the Company's
internal auditing procedures and accounting controls; to approve any
non-audit service rendered by the auditors to the Company; and to
monitor compliance with the Company's Code of Conduct.
The Compensation and Organization Committee consists of four
Directors: H. Edwin Trusheim (Chairman), Lee M. Liberman, Elliot H.
Stein, and William P. Stiritz. During the last fiscal year the
Committee held two meetings. The Committee's principal functions are:
to determine the compensation of the Chief Executive Officer and
certain other executive officers; to review and approve management's
recommendations as to the compensation of other officers and managerial
employees; to recommend contracts for officers and certain managerial
employees; to evaluate the Company's senior management and recommend
changes as appropriate; and to review and approve certain of the
Company's major employee compensation and benefit plans.
The Nominating Committee consists of three Directors: Elliot H. Stein
(Chairman), Leslie F. Loewe, and William P. Stiritz. During the last
fiscal year the Committee held two meetings. The Committee's principal
functions are: to recommend nominees for election as Directors of the
Company; to recommend nominees for Board committee appointment; and to
recommend candidates for appointment as corporate officers. The
Committee will consider any nominee for Director recommended by a
shareholder who submits a notice of nomination to the Company at least
30 days but not more than 60 days prior to the Annual Meeting of
Shareholders. Such notice shall contain appropriate data with respect
to the suggested candidate as required pursuant to the Company's
By-Laws.
4
<PAGE> 6
The Board of Directors met a total of 11 times during the fiscal year
ended January 29, 1994, including one telephonic meeting. All of the
Directors attended at least 75% of the total meetings held by the Board
and its respective committees, and which each respective Director was
eligible to attend, during the fiscal year.
BENEFICIAL OWNERSHIP OF THE COMPANY'S SECURITIES
<TABLE>
The following table shows the shares of Common Stock beneficially
owned by persons known by the Company to own 5% or more of the
outstanding shares of Common Stock.
<CAPTION>
BENEFICIALLY OWNED DIRECTLY
OR INDIRECTLY
---------------------------------
NAME AND ADDRESS PERCENT
OF BENEFICIAL OWNER COMMON STOCK OF CLASS
------------------- ------------ --------
<S> <C> <C>
Ariel Capital Management, Inc.(1)............................. 1,593,465 17.5%
307 N. Michigan Avenue
Chicago, Illinois 60601
First Pacific Advisors, Inc.(2)............................... 631,300 7.0%
11400 W. Olympic Boulevard
Los Angeles, CA 90064
NBD Bancorp, Inc.(3).......................................... 482,205 5.3%
611 Woodward
Detroit, MI 48226
Systematic Financial Management, Inc.(4)...................... 707,882 7.8%
Two Executive Drive
Fort Lee, NJ 07024
<FN>
- -----
(1) Stated information is based on a Schedule 13G, dated January 21,
1994, filed with the Securities and Exchange Commission. Ariel
Capital Management, Inc., an investment advisor, has sole voting
power as to 1,013,250 shares, shared voting power as to 202,490
shares, and sole dispositive power as to 1,593,465 shares.
(2) Stated information is based on a Schedule 13G, dated February 9,
1994, filed with the Securities and Exchange Commission. First
Pacific Advisors, Inc., an investment advisor, has shared voting
power as to 167,400 shares and shared dispositive power as to
631,300 shares.
(3) Stated information is based on a Schedule 13G, dated February 11,
1994, filed with the Securities and Exchange Commission. NBD
Bancorp, Inc., a parent holding company, has sole voting power as
to 460,535 shares, sole dispositive power as to 481,050 shares, and
shared dispositive power as to 155 shares.
(4) Stated information is based on a Schedule 13G, dated February 11,
1994, filed with the Securities and Exchange Commission. Systematic
Financial Management, Inc. ("Systematic") beneficially owns 704,082
shares; Cash Flow Investors, Inc. ("CFI") beneficially owns 3,800
shares. Kenneth S. Hackel is a parent Holding Company of these
Investment Advisors and disclaims beneficial ownership of the
shares owned by Systematic and CFI. Systematic has shared voting
power as to 65,300 shares and sole dispositive power as to 704,082
shares. CFI has shared voting power and sole dispositive power as
to 3,800 shares.
</TABLE>
5
<PAGE> 7
<TABLE>
The following table shows, as of April 4, 1994, the shares of Common
Stock beneficially owned by each person who is a Director or a named
executive officer and all persons as a group who were Directors or
executive officers as of that date. Except as otherwise noted, each
such person has sole voting and investment power as to his or her
shares. Each Director and named executive officer owns less than 1%,
and all executive officers and Directors as a group own 2.3% of the
outstanding shares of Common Stock plus options that are exercisable
within 60 days after April 4, 1994. No Director or executive officer
owns any shares of Series 1 Class A Preferred Stock.
<CAPTION>
NUMBER OF SHARES BENEFICIALLY
OWNED DIRECTLY OR INDIRECTLY
AS OF APRIL 4, 1994
---------------------------------------------
OBTAINABLE
THROUGH
STOCK OPTION
OWNED(1)(2) EXERCISE(3) TOTAL
----------- ------------ -----
<S> <C> <C> <C>
Theodore M. Armstrong.................................. 6,470(4) 17,000 23,470
Michael E. Burnham..................................... 1,289 6,600 7,889
Gene P. Byrd........................................... 2,663 15,000 17,663
Earle H. Harbison, Jr.................................. 1,050 - 1,050
Lee M. Liberman........................................ 1,950 - 1,950
Leslie F. Loewe........................................ 36,695(5) - 36,695
Martin Sneider......................................... 400 - 400
James E. Stefoff....................................... 13,831(6) 9,000 22,831
Elliot H. Stein........................................ 21,460(7) - 21,460
William P. Stiritz..................................... 1,200 - 1,200
H. Edwin Trusheim...................................... 1,400 - 1,400
Lawrence J. Young...................................... 20,215 29,000 49,230
All Executive Officers and Directors as a group
(16 persons).......................................... 113,004 97,800 210,804
<FN>
- -----
(1) Includes 14 whole shares for Mr. Burnham, 15 whole shares for Mr.
Byrd, 9 whole shares for Mr. Stefoff, 15 whole shares for Mr. Young
and 84 whole shares for all executive officers and Directors as a
group, all held under the employee stock ownership portion of the
Company's Retirement Savings Plan. Mr. Armstrong does not hold any
shares under the employee stock ownership portion of the Plan. With
respect to such shares, employee Directors and executive officers
have sole voting power and no current investment power.
(2) Includes 950 shares for Mr. Harbison, 1,350 shares for Mr.
Liberman, 400 shares for Mr. Sneider, 2,350 shares for Mr. Stein,
1,100 shares for Mr. Stiritz, and 1,250 shares for Mr. Trusheim all
held under the Company's Non-Employee Directors Stock Plan. With
respect to such shares, non-employee Directors have sole voting
power and no current investment power, except for the 1,350 shares
held by Mr. Liberman, and the 2,350 shares held by Mr. Stein which
are nonforfeitable.
(3) Stock options exercisable within 60 days after April 4, 1994.
(4) Mr. Armstrong disclaims beneficial ownership of 200 shares included
above which are held by a trust for his father of which he is
co-trustee.
(5) Mr. Loewe disclaims beneficial ownership of 6,945 shares included
above which are owned by his wife.
(6) Mr. Stefoff disclaims beneficial ownership of 4,000 shares included
above which are owned by his wife.
(7) This total includes 18,429 shares included above held by Mr. Stein
as a co-trustee of various trusts for beneficiaries who are
unrelated to him, as to which shares he has shared voting power and
investment power with the co-trustee. Mr. Stein disclaims
beneficial ownership of all the shares referred to in this note.
</TABLE>
6
<PAGE> 8
EXECUTIVE COMPENSATION
During the last three fiscal years the amounts shown in the table
below were paid to each of the Company's five most highly compensated
executive officers for services rendered during the applicable fiscal
year.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG TERM COMPENSATION
-------------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
--------------------------------------------------------------------------
BONUS RESTRICTED ALL OTHER
FISCAL ---------------- STOCK COMPEN-
NAME AND YEAR NONCASH AWARD(S) LTIP SATION
PRINCIPAL POSITION ENDING SALARY(1) CASH (2)(3) ($)(2)(3) OPTIONS (#) PAYOUTS(3)(4) ($)(5)
------------------ ------ --------- ---- ------- ---------- ----------- ------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Lawrence J. Young, 1/29/94 $240,000 $ 51,903 $51,903 $25,951 10,000 $ - $600
Chairman, President 1/30/93 217,923 44,062 44,062 22,032 20,000 - 600
& CEO 2/1/92 226,515 157,691 - - 20,000 - 600
James E. Stefoff,(4) 1/29/94 217,876 88,434 - - - 135,725 600
Executive Vice President 1/30/93 201,607 29,227 29,227 14,613 6,000 - 600
Also President, Angelica 2/1/92 202,268 114,026 - - 6,000 - 600
Healthcare Services
Group
Theodore M. Armstrong, 1/29/94 150,583 26,167 8,723 4,361 5,000 - 600
Senior Vice President- 1/30/93 147,115 18,000 12,000 6,000 10,000 - 600
Finance & Administration 2/1/92 149,552 55,749 - - 10,000 - 600
and Chief Financial Officer
Gene P. Byrd, Vice 1/29/94 154,750 17,250 17,250 8,625 4,000 - 600
President. Also President, 1/30/93 135,692 25,875 8,625 4,312 10,000 - 600
Angelica Uniform Group 2/1/92 141,242 31,896 - - 10,000 - 600
Michael E. Burnham, Vice 1/29/94 78,000 16,795 9,044 4,522 3,500 - 600
President. Also President, 1/30/93 70,673 26,669 6,667 3,333 6,000 - 600
Life Uniform and Shoe 2/1/92 67,027 23,122 - - 6,000 - 600
Shops
<FN>
- -----
(1) Includes participant deferrals under the Retirement Savings Plan.
(2) Participants in the Stock Bonus and Incentive Plan may elect to
receive up to 50% of their Incentive Compensation in restricted
shares of Company's Common Stock, ("elected shares") in lieu of
cash. Additionally, participants receive restricted shares in the
Company's Common Stock ("matching shares") with a fair market value
equal to 1/2 of that portion of the Incentive Compensation which
participants elected to take in Common Stock. Restricted shares of
Common Stock (both "elected shares" and "matching shares") were
issued to participants based upon the fair market value (the
average of the high/low transaction prices) of the Common Stock on
March 15, 1994. Elected shares are reported under the "Noncash"
column, while matching shares are reported under the "Restricted
Stock Awards" column. The named executive officers received elected
shares, which become transferable in three years as follows:
Mr. Young 2,060 shares; Mr. Armstrong 346 shares; Mr. Byrd 684
shares; and Mr. Burnham 359 shares. Mr. Stefoff elected not to
participate during the last fiscal year. Participants receive
dividends on all restricted shares.
(3) At the end of the last fiscal year, the named executive officers
held the following number of shares of restricted stock: Mr. Young,
2,760 shares; Mr. Stefoff, 1,831 shares; Mr. Armstrong, 751 shares;
Mr. Byrd, 540 shares; and Mr. Burnham, 417 shares.
(4) On March 17, 1993, Mr. Stefoff was granted 5,670 shares in
restricted shares of Company's Common Stock pursuant to the
Performance Shares Plan. The value was based on the fair market
value of the Common Stock on the award date. The award was based on
the performance of Angelica Healthcare Services Group, of which Mr.
Stefoff was President until his retirement from the Company on
January 31, 1994, over a period of four years and the attainment of
certain long range goals. 1,890 shares were released on March 16,
1994, with the remaining 3,780 shares to be released equally on
each of March 16, 1995 and 1996. Mr. Stefoff receives dividends on
all restricted shares.
(5) Company contributions to the Retirement Savings Plan on behalf of
each of the named executive officers to match 1993 participant
deferrals (included under Salary) made by each to such Plan.
</TABLE>
7
<PAGE> 9
STOCK OPTIONS
<TABLE>
The following table contains information concerning the grant of
Stock Options under the Company's Stock Option Plan to the named
executive officers of the Company during the last fiscal year.
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL
RATES OF STOCK PRICE
INDIVIDUAL GRANTS APPRECIATION FOR OPTION TERM
-------------------------------------------------- -------------------------------------
% OF
TOTAL
OPTIONS
GRANTED TO EXERCISE
OPTIONS EMPLOYEES OR BASE
GRANTED IN FISCAL PRICE EXPIRATION
NAME (#)(1) YEAR ($/SH) DATE 0% ($) 5% ($)(2) 10% ($)(2)
---- ------- ---------- -------- ---------- ------ --------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Lawrence J. Young............. 10,000 13.36% $26.625 11/30/2002 $0 $ 146,791 $ 361,554
James E. Stefoff.............. - - - - - - -
Theodore M. Armstrong......... 5,000 6.68 26.625 11/30/2002 0 73,396 180,777
Gene P. Byrd.................. 4,000 5.35 26.625 11/30/2002 0 58,716 144,621
Michael E. Burnham............ 3,500 4.68 26.625 11/30/2002 0 51,377 126,544
All Shareholders(3)........... N/A N/A N/A N/A 0 133,535,000 328,991,000
<FN>
- -----
(1) All options become exercisable ratably over five years and are
subject to continued employment. In the event of a "Non-Approved
Takeover," all options become immediately exercisable for a period
of 90 days, provided, however, SEC "Reporting Persons" are subject
to certain qualifications. The named executive officers received
only one grant of options during the last fiscal year.
(2) The dollar amounts shown in these columns are the result of
calculations at the 5% and 10% rates prescribed by the Securities
and Exchange Commission and are not intended to forecast possible
future appreciation of the Company's stock. There can be no
assurance that the Company's stock will perform at the assumed
annual rates shown in the table, and the Company neither makes nor
endorses any predictions as to future market performance of its
stock.
(3) All shareholders are shown in the table to demonstrate that no gain
to the optionees is possible without an increase in stock price.
The Potential Realizable Value to all shareholders is the aggregate
net gain for all shareholders based upon a fair market value of
$26.625 per share on November 30, 1993 assuming 9,099,457 shares of
the Company's stock remain outstanding until November 30, 2002 and
their value increases at the annual rates shown in the table.
</TABLE>
8
<PAGE> 10
OPTION EXERCISES AND HOLDINGS
<TABLE>
The following table sets forth information with respect to the named
executive officers concerning the exercise of options during the last
fiscal year and unexercised options held as of the end of the last
fiscal year.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<CAPTION>
VALUE OF
NUMBER OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
NUMBER OF OPTIONS AT OPTIONS AT
SECURITIES FY-END (#) FY-END ($)
UNDERLYING OPTIONS EXERCISABLE/ EXERCISABLE/
NAME EXERCISED (#) VALUE REALIZED ($) UNEXERCISABLE UNEXERCISABLE(1)
---- ------------------ ------------------ ------------- ----------------
<S> <C> <C> <C> <C>
Lawrence J. Young...................... 2,000 $5,125 18,000/41,000 $27,000/$20,375
James E. Stefoff....................... - - 9,000/ 3,000 0/ 0
Theodore M. Armstrong.................. 5,000 9,687 11,400/20,600 24,300/ 10,637
Gene P. Byrd........................... - - 12,000/19,000 19,375/ 7,250
Michael E. Burnham..................... - - 4,000/12,100 1,800/ 3,306
<FN>
- -----
(1) Based upon the average of the high/low transaction prices as
reported on New York Stock Exchange composite tape on January 28,
1994.
</TABLE>
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT
AND CHANGE-IN-CONTROL ARRANGEMENTS
James E. Stefoff retired from the Company effective January 31, 1994.
He has entered into a one-year consulting agreement with the Company
for a $12,000 per year retainer plus expenses.
Under a Management Retention and Incentive Plan, the Board has
authorized agreements with each of the current executive officers named
in the Summary Compensation Table. Under these agreements, the Company
will make an additional cash payment if, within two years following a
change in control of the Company (as defined in those agreements), the
individual's employment is terminated (other than for cause) or he
resigns for good reason such as a change in his responsibilities,
compensation or conditions of continued employment. Each of these
individuals will receive an amount up to 2.99 times his average annual
compensation during the five years prior to the change in control as
well as outplacement counselling and certain medical benefits.
Additionally, an individual will be relieved of all non-compete
obligations with respect to the Company.
Two separate trusts have been established with Boatmen's Trust
Company to fund certain benefits payable to key management personnel,
pursuant to certain employee benefit plans, in the event of their
termination of employment after a change in control of the Company (as
defined in the respective plans). One trust relates to the benefits
payable under the Management Retention and Incentive Plan, and the
other trust relates to the benefits payable under the Deferred
Compensation Option Plan for Selected Management Employees and the
Supplemental Plan. In the event of a change in control or potential
change in control of the Company, the Company is required to make a
deposit to each trust in an amount equal to the excess of the maximum
amount potentially payable under the plan or plans to all participants
over the current value of the trust assets. Each trust is revocable by
the Company at any time prior to a potential change in control or a
change in control of the Company, and will terminate automatically on
the date which is three years after a change in control. All remaining
trust assets will be returned to the Company upon the revocation or
termination of a trust. If the Company makes a deposit to a trust in
connection with a potential change in control, an actual change in
control does not occur within 90 days thereafter, and the Board adopts
a resolution that a change in control is not imminent, then the deposit
made by the Company will be returned. The assets of the trust
established to fund benefits under the Deferred Compensation Option
Plan for Selected Management Employees and the Supplemental Plan are
subject to the claims of the general creditors of the Company in the
event of the Company's insolvency.
9
<PAGE> 11
Notwithstanding anything to the contrary set forth in any of the
Company's previous filings under the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934 that might incorporate
future filings, including this Proxy Statement, in whole or in part,
the following Compensation and Organization Committee Report Regarding
Executive Compensation and the Performance Graph on page 13 shall not
be incorporated by reference, into any such filings.
COMPENSATION AND ORGANIZATION COMMITTEE REPORT
REGARDING EXECUTIVE COMPENSATION
The Compensation and Organization Committee of the Board of Directors
(the "Committee"), which consists entirely of outside directors, has
overall responsibility to review and recommend broad-based compensation
plans to the Board of Directors. The Committee also reviews and
approves participation in stock-related and long-term incentive plans
and executive benefits. The Committee and the management of the Company
are committed to the principle that a significant portion of total
compensation should be commensurate with performance and attainment of
predetermined financial and strategic objectives.
There are two elements in the Company's executive cash compensation
program, base salary and target incentive compensation. The Company's
cash compensation program is structured such that the total of an
executive's base salary and target incentive compensation is
competitive with other companies that are considered to be the
Company's competitors for executive talent. In setting compensation
levels for executives of the Company's various operating divisions, the
Committee considers the compensation packages offered by companies in
competitive markets, such as uniform manufacturing companies, textile
rental companies and specialty retail companies. Since there are no
companies with substantially similar lines of business as the Company,
taken as a whole, the compensation packages for the officers employed
at the Company's executive offices are compared to the compensation
packages of comparable officers of companies of similar size and
complexity as the Company. Companies used for comparative purposes in
analyzing the Company's compensation policies are not necessarily the
same companies included in the performance graph peer group. While the
performance of these comparative companies is not a primary factor, it
may be taken into consideration if the Committee deems appropriate.
The Company has established guidelines that the Committee uses in
determining on an ongoing basis the desired split between base salary
and target incentive compensation for executives of the Company. Under
these guidelines, executive positions are assigned grade levels, and
officers in the higher paid grade levels will generally have a smaller
percentage of their total compensation payable as base salary and a
greater percentage of their compensation payable upon the achievement
of performance targets established by the Committee. Under these
guidelines, an individual executive's target incentive compensation
ranges from 10% to 65% of base salary compensation based upon the
particular grade level. From time to time, the Committee may establish
target incentive levels for certain senior management executives in
excess of the established guidelines for the particular grade level.
The target incentive portion of the total compensation package is
consistent with the Committee's strong commitment to a pay-for-
performance policy with respect to executive compensation. With the
exception of Mr. Young, all of the named executive officers currently
have target incentive compensation percentages within the established
guidelines for their grade levels for their respective executive
positions, which percentages range from 36% to 52%. Mr. Young's target
incentive percentage is in excess of the established guidelines and is
discussed later in this report. To the extent that the split between
base salary and target incentive compensation in a newly-hired
executive's initial compensation package deviates from these
guidelines, the Committee will make adjustments in future years in such
a manner that the split between the executive's base salary and target
incentive compensation comes within the executive's applicable grade
level guidelines as soon as practicable after the initial year of
employment.
The actual amount of incentive compensation paid is based upon
performance in comparison to a targeted pre-tax earnings level achieved
by the Company or relevant operating group. Factors such as economic or
market conditions are taken into account in setting the Company's
targeted pre-tax earnings level. Actual incentive compensation earned
during the last fiscal year demonstrates the Board's philosophy. As the
Company did not achieve all of its financial objectives in fiscal 1994,
executive officers received less than their
10
<PAGE> 12
targeted incentive compensation. Those listed in the Summary
Compensation Table received the following percentage of their targeted
incentive compensation: Mr. Young 58%; Mr. Stefoff 96%; Mr. Armstrong
58%; Mr. Byrd 50%; and Mr. Burnham 96%.
The Company's executive officers are encouraged to maintain a
significant long-term stock ownership position in the Company's Common
Stock in order to align their interests with those of the Company's
shareholders. The Committee believes that executives who hold such
positions will be more motivated to generate performance gains by
working steadily to increase shareholder value over the long term. The
Stock Bonus and Incentive Plan encourages employees to invest in the
Company's Common Stock by providing a matching incentive, yet requires
that the stock investment be held for set periods after issuance in
order to retain the stock purchased with the Company's match,
encouraging employees to work to increase the price of Common Stock.
All eligible executive officers, except one who has recently retired,
have elected to participate.
In addition, as indicated in the foregoing tables, the Committee
awarded stock options under the Company's Stock Option Plan to various
executives. The option price is the fair market value on the date of
grant, and options become exercisable ratably over the next five years
if the executive remains employed by the Company. The Stock Option Plan
gives employees the opportunity to buy Common Stock at option prices
which, at the time of exercise, may be below the then market value.
This also encourages employees to work towards the growth of
shareholder value. Grants are viewed as an opportunity for employees to
invest in the Company's Common Stock in such a manner as will result in
a long-term increase in the employee's net worth and a supplement to
retirement savings, while at the same time meeting the Board's goal of
employee ownership of Common Stock. The amount of grants vary, based on
the employee's grade level and performance. While the value realizable
from exercisable options is dependent upon the extent to which the
Company's performance is reflected in the market price of the Company's
Common Stock at a particular point in time, the decision as to whether
to exercise an option and thus realize the value in any particular year
is determined by each individual executive.
MR. YOUNG'S COMPENSATION FOR THE LAST FISCAL YEAR
The Committee's general approach in setting Mr. Young's annual cash
compensation is to seek to be competitive with other companies of
comparable size and business scope, while at the same time having a
large percentage of his total cash compensation based upon performance
criteria. While this may result in a fluctuation in the actual level of
Mr. Young's compensation from year to year, the Committee believes that
its objective appropriately incentivizes the Company's chief executive
officer toward clearly defined goals, while maintaining some certainty
in the level of compensation through the non-performance-based base
salary portion of total compensation. In keeping with this philosophy,
Mr. Young's target incentive compensation is equal to 75% of his base
salary compensation. For the reported fiscal year, Mr. Young received
58% of his target incentive compensation. Mr. Young's compensation
increase in the fiscal year ending January 29, 1994, as reflected in
the Summary Compensation Table, is principally a result of his
voluntary decision to reduce his salary by 10% for the period July 1,
1992 to February 1, 1993, due to poor operating results.
Mr. Young's participation in the Stock Option Plan and the Stock
Bonus and Incentive Plan is also in accordance with the Committee's
philosophy that the chief executive officer be encouraged to maintain a
significant stock ownership position in order to align his interests
with those of the Company's shareholders.
Although no executive officer currently receives in excess of
$1,000,000 compensation, the Committee's policy is to maximize the tax
deductibility of executive compensation without compromising the
essential framework of the existing total compensation program. The
Committee may elect to forego deductibility for federal income tax
purposes if such action is, in the opinion of the Committee, necessary
or appropriate to further the goals of the Company's executive
compensation program, or otherwise is in the Company's best interests.
11
<PAGE> 13
Although the foregoing describes the Committee's current compensation
policies applicable to the Company's executive officers, the Committee
reserves the right to change these policies at such time in the future
and in such manner as the Committee deems necessary or appropriate.
SUBMITTED BY THE COMPENSATION AND ORGANIZATION COMMITTEE OF THE
COMPANY'S BOARD OF DIRECTORS
H. E. Trusheim, Chairman L. M. Liberman
E. H. Stein W. P. Stiritz
PENSION PLAN
The Company has maintained a defined benefit Pension Plan since
April 1, 1980. An employee earns benefits in any year equal to 0.25% of
total compensation plus an additional 0.25% of that part of
compensation which is in excess of one-half of the Social Security
Taxable Wage Base, plus, for each year of employment in excess of 15
years, an additional 0.05% of total compensation. Reduced benefits are
payable at early retirement. Estimated annual benefits under the
Pension Plan payable upon normal retirement to the named executive
officers are as follows: Mr. Young, $45,645; Mr. Armstrong, $15,653;
Mr. Byrd, $26,691; and Mr. Burnham, $27,001. These figures assume that
participants will remain with the Company until their normal retirement
dates and will receive reasonable increases to their current
compensation. Mr. Stefoff's actual annual benefit, having retired
January 31, 1994, will be $16,726.
The Company also maintains the Supplemental Plan, a supplemental
retirement benefit plan for a limited number of highly compensated
officers and management personnel selected by the Compensation and
Organization Committee. All of the named executive officers participate
in the Supplemental Plan.
The "formula amount" of supplemental retirement benefit payable under
this Supplemental Plan is determined by the Committee when the
participant is invited to join the Plan and is subject to increase at
the Committee's discretion. Additionally, the Committee may, at its
discretion, reduce the formula amount or "freeze" the then vested
benefit of certain participants. A full benefit is the participant's
final average compensation multiplied by the formula amount (between
30% and 50%). A participant who has less than 30 years of service at
retirement will receive a reduced amount of the otherwise fully vested
formula amount, based on actual years of service. For the purposes of
this Supplemental Plan, final average compensation means the average
compensation paid during the three most highly compensated years of the
participant's last five years of employment.
Benefits are generally payable over 120 months beginning at age 65,
but may extend for a period of up to 15 years. Any benefit payable
under the Supplemental Plan will be reduced by benefits paid under the
Pension Plan.
Estimated annual benefits under the Supplemental Plan payable upon
normal retirement over a ten-year period to the named executive
officers are as follows: Mr. Young, $336,000; Mr. Armstrong, $50,000;
Mr. Byrd, $106,000; and Mr. Burnham, $103,000. These figures reflect a
reduction for the benefit payable under the Pension Plan (or
predecessor plan), and assume that participants will remain with the
Company until their normal retirement dates and will receive reasonable
increases to their current compensation. Mr. Stefoff's actual annual
benefit, having retired January 31, 1994, will be $20,335.
12
<PAGE> 14
PERFORMANCE GRAPH
The following is a line-graph presentation comparing five-year
cumulative total returns among the Company's Common Stock*, the
Standard & Poors 500 Index and the Value Line Industrial/Business
Services Index for the five years ended January 31, 1994.
[PERFORMANCE GRAPH]
(ASSUMES $100 INVESTED ON JANUARY 31, 1989 AND THAT DIVIDENDS ARE REINVESTED.)
[FN]
- -----
*The Company, in its Proxy Statement issued for the previous fiscal
year, utilized a performance graph comparing cumulative total returns
among the Company's Common Stock, the Standard & Poors 500 Index and
Bridge Information Systems' Business Services and Suppliers Index (the
"Bridge Index"). The Bridge Index included companies having one or
more of the following Standard Industrial Classification Codes: 5734,
7320, 7330, 7340, 7350, 7359, 7361, 7363, 7377, 7380, 7381, 7389,
8111, 8200, 8351, 8600, 8700, 8711, 8741, 8742, 8744 and listed on
either the New York Stock Exchange or the American Stock Exchange. The
Bridge Index is no longer published. The Value Line
Industrial/Business Services Index,utilized in lieu of the Bridge
Index, is a published index.
2. PROPOSAL TO ADOPT AND APPROVE THE ANGELICA CORPORATION
1994 PERFORMANCE PLAN
The Board of Directors has approved, subject to adoption by the
Company's shareholders, the Angelica Corporation 1994 Performance Plan.
GENERAL
The Plan provides for the grant of Incentive Stock Options,
Nonqualified Stock Options, Restricted Stock and Performance Awards to
employees of the Company. The purpose of the Plan is to advance the
interests of the Company and its shareholders by encouraging the
success of the Company by providing for the acquisition of an equity
interest by key employees, by providing additional incentives and
motivation toward superior Company performance, and by enabling the
Company to attract and retain the services of key employees upon whose
judgment, talents, and special effort the successful conduct of its
operations is largely dependent.
13
<PAGE> 15
Incentive Stock Options and Nonqualified Stock Options consist of
options to purchase shares of Common Stock at purchase prices not less
than 100% of the fair market value of the shares on the date the option
is granted. Options are exercisable not less than six months and not
more than ten years after the date of grant. No individual participant
shall be granted Stock Options with respect to more than 200,000 shares
of the Company's Common Stock during the term of the Plan.
The aggregate fair market value (determined as of the time an option
is granted) of the stock with respect to which an Incentive Stock
Option is exercisable for the first time during any calendar year
(under all option plans of the Company) shall not exceed $100,000.
Restricted Stock consists of Common Stock of the Company issued at
any purchase price less than the fair market value thereof on the date
of issuance. The Restricted Stock may be subject to certain
restrictions set by the Compensation and Organization Committee (the
"Committee"). Participants will be entitled to all dividends with
respect to Restricted Stock during the period of restriction and shall
be entitled to vote the Restricted Stock.
Performance Awards consist of Common Stock of the Company, monetary
units or some combination thereof, to be issued without any payment
therefor, in the event that certain performance goals established by
the Committee are achieved over a period of time not more than five
years.
The Plan will be administered by the Committee, consisting of three
or more outside Directors of the Company.
TOTAL NUMBER OF SHARES SUBJECT TO THE PLAN
The Plan authorizes the issuance of up to 500,000 shares of the
Common Stock of the Company, which may be authorized but unissued or
treasury shares.
ELIGIBILITY
Officers and Key Employees of the Company and its subsidiaries and
divisions are eligible to participate at the sole discretion of the
Committee. Designation of a participant in any year does not require
the Committee to designate such person to receive a benefit in any
other year. The Committee will consider such factors as it deems
pertinent in selecting participants and in determining the type and
amount of their respective benefits.
FEDERAL INCOME TAX CONSEQUENCES
A participant realizes taxable income in the case of Incentive Stock
Options at the time that shares purchased pursuant to the exercise of
an option are sold. In the case of a Nonqualified Stock Option,
participants realize taxable income at the time of exercise of the
Option. With respect to Restricted Stock, a participant will not
recognize taxable income until such time as any restrictions involving
a risk of forfeiture by the participant are terminated. Performance
Awards could result in taxable income to a participant at various
times, depending on the nature of the award, vesting schedule, or
restrictions imposed by the Committee. The Company has the power to
withhold or require a Participant to remit to the Company, an amount
sufficient to satisfy Federal, state, and local withholding tax
requirements. If the Company permits, a Participant may elect to
satisfy the tax withholding requirement by directing the Company to
apply shares of stock to which the Participant will be entitled as a
result of the exercise of options, the grant of an award of shares or
the lapse of restrictions, to satisfy such tax requirement.
Assuming compliance with Section 162(m) of the Internal Revenue Code
of 1986 as amended (the Code), the Company is entitled to a tax
deduction at such time as the participant realizes taxable income.
Section 162(m) of the Code and the regulations promulgated thereunder
limit the deductibility of non-qualifying compensation in excess of
$1,000,000 paid to the chief executive officer and certain other highly
compensated executive officers. The Committee's policy is to maximize
the tax deductibility of executive compensation without compromising
the essential framework of the existing total compensation program. The
Committee may elect to forego deductibility for federal income tax
purposes if such action is, in the opinion of the
14
<PAGE> 16
Committee, necessary or appropriate to further the goals of the
Company's executive compensation program, or otherwise is in the
Company's best interests.
A copy of the Plan is attached hereto as Appendix A.
The affirmative vote of the holders of a majority of the shares
represented at this Annual Meeting is required for adoption of the 1994
Performance Plan.
THE BOARD OF DIRECTORS RECOMMENDS WITHOUT DISSENT A VOTE FOR ADOPTION
---
OF THE 1994 PERFORMANCE PLAN, AND PROXIES SOLICITED BY THE BOARD OF
DIRECTORS WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY A CONTRARY
CHOICE ON THE PROXY.
3. APPROVAL OF THE MATERIAL TERMS OF THE CRITERIA TO BE USED IN
THE GRANT OF PERFORMANCE AWARDS AND PERFORMANCE-BASED RESTRICTED
STOCK AWARDS UNDER THE ANGELICA CORPORATION 1994 PERFORMANCE PLAN
The Board of Directors has approved and recommended the approval by
the Company's shareholders at this Annual Meeting of the Angelica
Corporation 1994 Performance Plan (see Item 2 in this Proxy Statement).
The Plan has been drafted and will be administered so as to assure that
the compensation payable pursuant to Stock Options issued under the
Plan will qualify as "performance based" under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code") and the proposed
regulations thereunder. Section 162(m), which was adopted during 1993
for tax years beginning in 1994, limits the deductibility for federal
income tax purposes of non-qualifying compensation in excess of $1
million paid by the Company to the Chief Executive Officer and certain
other executive officers of the Company.
In order to qualify the compensation payable to such officers
pursuant to the grant of performance awards and performance-based
restricted stock awards under the Plan, the Compensation and
Organization Committee (the "Committee") has established, and the Board
of Directors has ratified and recommended for the approval of the
Company's shareholders, the material terms of the criteria to be
utilized by the Committee in the making of such award grants. Approval
of the material terms of the criteria is necessary for the compensation
payable pursuant to performance awards and performance-based restricted
stock awards to be performance-based under Section 162(m) and the
regulations promulgated thereunder and, thus, fully deductible under
the Code when taxable to the participant.
Pursuant to the Plan and the criteria established by the Committee
pursuant thereto, any officer and any other key employee who the
Committee, in its sole discretion, determines to have an important
impact on the success and future growth and profitability of the
Company may be selected by the Committee to receive a performance award
or a performance-based restricted stock award under the Plan. The Plan
authorizes the Committee to grant periodically both performance awards
and performance-based restricted stock grant awards. The Committee may
also choose to grant non-performance-based restricted stock awards
under the terms of the Plan.
Performance awards are awards that will be payable in shares of
Common Stock of the Company, monetary units based upon the Company's
Common Stock or any combination thereof based upon the achievement of
certain performance goals established by the Committee during a
designated performance period of not more than five years. Performance
awards may be payable in cash or in shares of Common Stock of the
Company, or in a combination of both, as the Committee in its sole
discretion determines.
Performance-based restricted stock awards are awards of the Company's
Common Stock, at a purchase price of less than the then-current fair
market value of such stock or as a bonus upon the achievement of
certain performance goals established by the Committee. The grant of
such restricted stock award will be subject to such restrictions,
conditions and terms as the Committee shall deem appropriate at the
time of the grant of the award. Shares of the Company's Common Stock
will be issued in the name of the participant at the time that the
performance goal is achieved. The participant shall be entitled to
receive dividends from and vote the shares during any subsequent period
of restriction. The shares of restricted stock subject to earned awards
will be released to the participant after the termination of the period
of restriction.
The performance goal categories to be utilized for both the
performance awards and the performance-based restricted stock awards
may be based upon one or more of the following financial
15
<PAGE> 17
performance standards: earnings per share, return on assets, net
income, overhead ratio, expense to asset ratio, total shareholder
return, pre-tax earnings, debt to equity ratio, asset management
criteria, expense reduction goals, expense to sales ratio, working
capital to sales ratio, gross margin performance, current ratio, share
price change, sales and revenues, return on equity, free cash flow per
share and operating earnings per share. The Committee may exclude from
such performance categories such extraordinary and non-recurring items
as the Committee, in consultation, at its discretion, with the
Company's internal and external auditors, may deem appropriate in
determining whether the established performance goals have been
achieved.
The Committee will also establish at the time of the grant of the
particular award, the potential stock or stock unit amounts that can be
earned by the participant upon achievement of the performance goals.
The maximum number of shares or share units of the Company's Common
Stock that may be earned by a single participant under the Plan
pursuant to a performance award or a performance-based restricted stock
award is 200,000. The Committee retains the right to set performance
goals on the basis of any of the performance categories set forth above
or to change the performance categories used to determine whether an
award has been earned or the level of the award so earned (but not in
excess of the maximum number of shares or share units set forth above
for an individual participant). No compensation will be paid under
performance awards or performance-based restricted stock awards granted
pursuant to the Plan in the event that the shareholders do not approve
the material terms of the criteria set forth above. Such material terms
with respect to the grant of performance awards and performance-based
restricted stock awards will remain in full force and effect until
amended by the Committee and approved by the shareholders.
The vote of the shareholders that is required to approve the material
terms of the criteria applicable to the grant of performance awards and
performance-based restricted stock awards pursuant to the Plan is a
majority of the shares of the Company's Common Stock present, in person
or by proxy, and voting on this proposal at the Annual Meeting.
Abstentions and brokers non-votes will not be deemed to be voted shares
for purposes of this vote.
THE BOARD OF DIRECTORS RECOMMENDS WITHOUT DISSENT A VOTE FOR THE
APPROVAL OF THE MATERIAL TERMS OF THE CRITERIA TO BE USED IN THE GRANT
OF PERFORMANCE AWARDS AND PERFORMANCE-BASED RESTRICTED STOCK AWARDS
UNDER THE 1994 PERFORMANCE PLAN, AND PROXIES SOLICITED BY THE BOARD OF
DIRECTORS WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY A CONTRARY
CHOICE ON THE PROXY.
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen & Co. has served as independent public accountants
for the Company since 1954, and the Board of Directors has selected it
to serve in that capacity again. Representatives of Arthur Andersen &
Co. are expected to be present at the Annual Meeting of Shareholders.
Such representatives will have an opportunity to make a statement, if
they so desire, and will be available to respond to appropriate
questions by shareholders.
SHAREHOLDER PROPOSALS
Shareholder proposals must be received by the Company at its
principal executive offices no later than December 19, 1994 to be
included in the Company's proxy materials for its 1995 Annual Meeting
of Shareholders. Shareholder proposals not in full conformity with
applicable rules of the Securities and Exchange Commission may be
excluded from such materials.
16
<PAGE> 18
GENERAL
Proxies will be solicited by mail. They also may be solicited by
officers and regular employees of the Company personally or by
telephone, but such persons will not be specifically compensated for
such services. Corporate Investor Communications, Inc. has been
retained to assist in the solicitation of proxies for a fee of $5,000,
plus expenses. Banks, brokers, nominees, and other custodians and
fiduciaries may be reimbursed for their reasonable out-of-pocket
expenses in forwarding soliciting material to the beneficial owners.
The cost of soliciting proxies will be borne by the Company.
The Board of Directors does not intend to bring any other matters
before the meeting, and, at the date of this Proxy Statement, the Board
of Directors is not informed of any matters that others may bring
before the meeting. However, if any other matters properly come before
the meeting, it is the intention of the proxies named on the proxy card
to vote as proxies on such matters in accordance with their judgment as
to the Company's best interest.
SHAREHOLDERS ARE URGED TO DATE, SIGN, AND PROMPTLY RETURN THE ENCLOSED
PROXY IN THE ACCOMPANYING ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED
IN THE UNITED STATES. YOUR COOPERATION WILL BE APPRECIATED.
St. Louis, Missouri
April 15, 1994
17
<PAGE> 19
APPENDIX A
ANGELICA CORPORATION
1994 PERFORMANCE PLAN
<PAGE> 20
ANGELICA CORPORATION
<TABLE>
1994 PERFORMANCE PLAN
<S> <C>
SECTION 1. PURPOSE..................................................................................... A-1
SECTION 2. ADMINISTRATION.............................................................................. A-1
SECTION 3. SHARES RESERVED UNDER THE PLAN.............................................................. A-1
SECTION 4. PARTICIPANTS................................................................................ A-1
SECTION 5. TYPES OF BENEFITS........................................................................... A-1
SECTION 6. INCENTIVE STOCK OPTIONS..................................................................... A-1
SECTION 7. NONQUALIFIED STOCK OPTIONS.................................................................. A-2
SECTION 8. RESTRICTED STOCK............................................................................ A-2
SECTION 9. PERFORMANCE AWARDS.......................................................................... A-3
SECTION 10. ADJUSTMENT PROVISIONS...................................................................... A-3
SECTION 11. NONTRANSFERABILITY......................................................................... A-4
SECTION 12. TAXES...................................................................................... A-4
SECTION 13. TENURE..................................................................................... A-4
SECTION 14. DURATION, INTERPRETATION, AMENDMENT AND TERMINATION........................................ A-4
</TABLE>
<PAGE> 21
ANGELICA CORPORATION
1994 PERFORMANCE PLAN
1. PURPOSE. The purpose of this Plan is to encourage certain
employees of Angelica Corporation, and of such subsidiaries of the
Corporation as the Committee administering the Plan designates, to
acquire Common Stock of the Corporation or to receive monetary payments
based on the value of such stock or based upon achieving certain goals
on a basis mutually advantageous to such employees and the Corporation
and thus provide an incentive for continuation of the efforts of
employees for the success of the Corporation and for continuity of
employment.
2. ADMINISTRATION. The Plan will be administered by the Compensation
and Organization Committee (the "Committee") of the Board of Directors
of the Corporation consisting of three or more Directors as the Board
may designate from time to time, each of whom is an "outside" Director
as that term is defined pursuant to Section 162(m) of the Internal
Revenue Code of 1986 as amended (the Code) and the regulations
promulgated thereunder and none of whom have been eligible to receive a
benefit under this Plan for a period of at least one year prior to
appointment or during the period of appointment. The determinations of
the Committee shall be made in accordance with their judgment as to the
best interests of the Corporation and its stockholders and in
accordance with the purpose of the Plan. A majority of members of the
Committee shall constitute a quorum, and all determinations of the
Committee shall be made by a majority of its members. Any determination
of the Committee under the Plan may be made without notice or meeting
of the Committee, by a writing signed by a majority of the Committee
members.
3. SHARES RESERVED UNDER THE PLAN. There is hereby reserved for
issuance under the Plan an aggregate of Five Hundred Thousand (500,000)
shares of Common Stock of the Corporation, which may be authorized but
unissued or treasury shares. Stock underlying outstanding options or
Performance Awards will be counted against the Plan maximum while such
options, rights or awards are outstanding. Shares underlying expired,
cancelled or forfeited options, rights or awards may be added back to
the Plan. When the exercise price of stock options is paid by delivery
of shares of Common Stock of the Corporation, or if the Committee
approves the withholding of shares from a distribution in payment of
the exercise price, the number of shares available for issuance under
the Plan shall be reduced by the gross (rather than the net) number of
shares which would have been issued pursuant to such exercise,
regardless of the number of shares surrendered or withheld in payment.
Notwithstanding any other provisions of this Plan, no individual
participant shall be granted stock options with respect to more than
200,000 shares of Common Stock of the Corporation during the term of
the Plan. Restricted Stock issued pursuant to the Plan will be counted
against the Plan maximum while outstanding even while subject to
restrictions. Shares of Restricted Stock may not be added back to the
Plan if such Restricted Stock is forfeited.
4. PARTICIPANTS. Participants will consist of such officers and key
employees of the Corporation or any designated subsidiary as the
Committee in its sole discretion determines have an important impact on
the success and future growth and profitability of the Corporation.
Designation of a participant in any year shall not require the
Committee to designate such person to receive a benefit in any other
year or to receive the same type or amount of benefit as granted to the
participant in any other year or as granted to any other participant in
any year. The Committee shall consider such factors as it deems
pertinent in selecting participants and in determining the type and
amount of their respective benefits.
5. TYPES OF BENEFITS. The following benefits may be granted under the
Plan: (a) Incentive Stock Options, (b) Nonqualified Stock Options; (c)
Restricted Stock; and (d) Performance Awards; all as described below.
6. INCENTIVE STOCK OPTIONS: Incentive Stock Options shall consist of
stock options to purchase shares of Common Stock at purchase prices not
less than 100% of the fair market value of the shares on the date the
option is granted. Said purchase price may be paid (i) by check or, in
the discretion of the Committee, either (ii) by the delivery of shares
of Common Stock of the Corporation then owned by the participant or
(iii) by directing the Company to withhold from the number of shares of
Common Stock otherwise issuable upon
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<PAGE> 22
exercise of the option that number of shares of Common Stock having an
aggregate fair market value on the date of exercise equal to the
exercise price for all of the shares of Common Stock subject to such
exercise, or (iv) by a combination of any of the foregoing, in the
manner provided in the option agreement. Incentive Stock Options will
be exercisable not earlier than six months and not later than ten years
after the date they are granted and will terminate not later than three
months after termination of employment for any reason other than death
or disability. In the event termination of employment occurs as a
result of death or disability, such an option will be exercisable for
12 months after such termination. If the optionee dies within 12 months
after termination of employment by disability, then the period of
exercise following death shall be the remainder of the 12-month period,
or three months, whichever is longer. If the optionee dies within three
months after termination of employment for any other reason, then the
period of exercise following death shall be three months. However, in
no event shall any Incentive Stock Option be exercised more than ten
years after its grant. Leaves of absence granted by the Corporation for
military service, illness, and transfers of employment between the
Corporation and any subsidiary thereof shall not constitute termination
of employment. The aggregate fair market value (determined as of the
time an option is granted) of the stock with respect to which an
Incentive Stock Option is exercisable for the first time during any
calendar year (under all option plans of the Corporation and its
subsidiary corporations) shall not exceed $100,000.
7. NONQUALIFIED STOCK OPTIONS. Nonqualified Stock Options shall
consist of nonqualified stock options to purchase shares of Common
Stock at purchase prices not less than 100% of the fair market value of
the shares on the date the option is granted. Said purchase price may
be paid (i) by check or, in the discretion of the Committee, either
(ii) by the delivery of shares of Common Stock of the Corporation then
owned by the participant or (iii) by directing the Company to withhold
from the number of shares of Common Stock otherwise issuable upon
exercise of the option that number of shares of Common Stock having an
aggregate fair market value on the date of exercise equal to the
exercise price for all of the shares of Common Stock subject to such
exercise, or (iv) by a combination of any of the foregoing, in the
manner provided in the option agreement. Nonqualified Stock Options
will be exercisable not earlier than six months and not later than ten
years after the date they are granted and will terminate not later than
three months after termination of employment for any reason other than
death, retirement or disability. In the event termination of employment
occurs as a result of death, retirement or disability, such an option
will be exercisable for 12 months after such termination. If the
optionee dies within 12 months after termination of employment by
retirement or disability, then the period of exercise following death
shall be three months. However, in no event shall any option be
exercised more than ten years after its grant. Leaves of absence
granted by the Corporation for military service, illness, and transfers
of employment between the Corporation and any subsidiary thereof shall
not constitute termination of employment. The Committee shall have the
right to determine at the time the option is granted whether shares
issued upon exercise of a Nonqualified Stock Option shall be subject to
restrictions, and if so, the nature of the restrictions.
8. RESTRICTED STOCK. Restricted Stock shall consist of Common Stock
of the Corporation issued or transferred under the Plan (other than
upon exercise of Stock Options or as Performance Awards) at any
purchase price less than the fair market value thereof on the date of
issuance or transfer, or as a bonus. In the case of any Restricted
Stock:
(a) The purchase price, if any, will be determined by the
Committee.
(b) Restricted Stock may be subject to (i) restrictions on the sale
or other disposition thereof, provided, however, that Restricted
Stock granted to a person who is subject to Section 16 of the
Securities Exchange Act of 1934 (a "Reporting Person") shall, in
addition to any other restrictions thereon, not be sold or disposed
of for six (6) months following the date of grant; (ii) rights of the
Corporation to reacquire such Restricted Stock at the purchase price,
if any, originally paid therefor upon termination of the employee's
employment within specified periods; (iii) representation by the
employee that he or she intends to acquire Restricted Stock for
investment and not for resale; and (iv) such other restrictions,
conditions and terms as the Committee deems appropriate.
(c) The participant shall be entitled to all dividends paid with
respect to Restricted Stock during the period of restriction and
shall not be required to return any such dividends to the Corporation
in the event of the forfeiture of the Restricted Stock.
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<PAGE> 23
(d) The participant shall be entitled to vote the Restricted Stock
during the period of restriction.
(e) The Committee shall determine whether Restricted Stock is to be
delivered to the participant with an appropriate legend imprinted on
the certificate or if the shares are to be deposited in escrow
pending removal of the restrictions.
9. PERFORMANCE AWARDS.
(a) Performance Awards shall consist of Common Stock of the
Corporation, monetary units or some combination thereof, to be issued
without any payment therefor, in the event that certain performance
goals established by the Committee are achieved over a period of time
designated by the Committee, but not in any event more than five
years. The goals established by the Committee may include return on
average total capital employed, earnings per share, return on
stockholders' equity and such other goals as may be established by
the Committee. In the event the minimum Corporate goal is not
achieved at the conclusion of the period, no payment shall be made to
the participant. Actual payment of the award earned shall be in cash
or in Common Stock of the Corporation or in a combination of both, as
the Committee in its sole discretion determines. If Common Stock of
the Corporation is used, the participant shall not have the right to
vote and receive dividends until the goals are achieved and the
actual shares are issued. In the event a Reporting Person receives a
Performance Award which includes Common Stock of the Corporation,
such stock shall not be sold or disposed of for six (6) months
following the date of issuance pursuant to such award. In the event
of a cash payment, the number of shares reserved for issuance
hereunder shall be reduced as if shares had been issued.
(b) The Committee is expressly authorized to include under this
Section 9 and to pay under this Plan that portion of any award earned
under any separate management incentive award program (or similar
program) of the Corporation or any subsidiary thereof which is to be
paid or distributed to participants thereunder in Common Stock of the
Corporation. If and to the extent that the Committee exercises its
authority to include and pay such awards under this Plan, the
designation of the incentive award program as covered by this Plan
shall be sufficient to include the participants under such award
program as participants in this Plan, but such participants may not
receive any other benefits or distributions under this Plan unless
they are separately designated as participants hereunder with
specific additional rights to benefits described only in this Plan.
Reporting Persons who receive payment under this Section 9 shall be
subject to the provisions of this Plan applicable to awards to
Reporting Persons.
10. ADJUSTMENT PROVISIONS.
(a) If the Corporation shall at any time change the number of
issued shares of Common Stock without new consideration to the
Corporation (such as by stock dividends or stock splits), the total
number of shares reserved for issuance under this Plan, the maximum
number of shares available to a particular participant, and the
number of shares covered by each outstanding benefit, shall be
adjusted so that the aggregate consideration payable to the
Corporation, if any, and the value of each such benefit shall not be
changed. Benefits may also contain provisions for their continuation
or for other equitable adjustments after changes in the Common Stock
resulting from reorganization, sale, merger, consolidation, issuance
of stock rights or warrants, or similar occurrence.
(b) Notwithstanding any other provision of this Plan, and without
affecting the number of shares reserved or available hereunder, the
Board of Directors may authorize the issuance or assumption of
benefits in connection with any merger, consolidation, acquisition of
property or stock, or reorganization upon such terms and conditions
as it may deem appropriate.
(c) The six month holding periods in Sections 6 and 7 above shall
not apply in the event that more than 20% of the Corporation's Common
Stock, business, or assets are purchased or acquired by any person,
firm, corporation, or group acting in concert and without agreement
of the Corporation's Board of Directors. In such event, any such
option or right shall be deemed exercisable upon grant and with no
waiting period.
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<PAGE> 24
11. NONTRANSFERABILITY. Each benefit granted under the Plan to an
employee shall not be transferable otherwise than by will or the laws
of descent and distribution or pursuant to a Qualified Domestic
Relations Order (as defined in Section 206(d)(3) of the Employee
Retirement Income Security Act of 1974, as amended, and the rules
promulgated thereunder), and shall be exercisable, during the
participant's lifetime, only by the participant. In the event of the
death of a participant, exercise or payment shall be made only:
(a) By or to the executor or administrator of the estate of the
deceased participant or the person or persons to whom the deceased
participant's rights under the benefit shall pass by will or the laws
of descent and distribution; and
(b) To the extent that the deceased participant was entitled
thereto at the date of his death.
12. TAXES. The Corporation shall be entitled to withhold the amount
of any tax attributable to any amounts payable or shares deliverable
under the Plan after giving the person entitled to receive such payment
or delivery notice as far in advance as practicable, and the
Corporation may defer making payment or delivery as to any benefit if
any such tax is payable until indemnified to its satisfaction. The
person entitled to any such delivery may, by notice to the Corporation
at the time the requirement for such delivery is first established,
elect to have such withholding satisfied by a reduction of the number
of shares otherwise so deliverable, such reduction to be calculated
based on a closing market price on the date of such notice.
13. TENURE. A participant's right, if any, to continue to serve the
Corporation and its subsidiaries as an officer, employee, or otherwise,
shall not be enlarged or otherwise affected by his or her designation
as a participant under the Plan.
14. DURATION, INTERPRETATION, AMENDMENT AND TERMINATION. No benefit
shall be granted more than ten years after the date of adoption of this
Plan; provided, however, that the terms and conditions applicable to
any benefit granted within such period may thereafter be amended or
modified by mutual agreement between the Corporation and the
participant or such other person as may then have an interest therein.
Also, by mutual agreement between the Corporation and a participant
hereunder, Stock Options or other benefits may be granted to such
participant in substitution and exchange for, and in cancellation of,
any benefits previously granted such participant under this Plan. To
the extent that any Stock Options or other benefits which may be
granted within the terms of the Plan would qualify under present or
future laws for tax treatment that is beneficial to a recipient, then
any such beneficial treatment shall be considered within the intent,
purpose and operational purview of the Plan and the discretion of the
Committee, and to the extent that any such Stock Options or other
benefits would so qualify within the terms of the Plan, the Committee
shall have full and complete authority to grant Stock Options or other
benefits that so qualify (including the authority to grant,
simultaneously or otherwise, Stock Options or other benefits which do
not so qualify) and to prescribe the terms and conditions (which need
not be identical as among recipients) in respect to the grant or
exercise of any such Stock Option or other benefits under the Plan. The
Board of Directors may amend the Plan from time to time or terminate
the Plan at any time. However, no action authorized by this paragraph
shall reduce the amount of any existing benefit or change the terms and
conditions thereof without the participant's consent. No amendment of
the Plan shall, without approval of the stockholders of the Corporation
(a) increase the total number of shares which may be issued under the
Plan or increase the amount or type of benefits that may be granted
under the Plan; (b) change the minimum purchase price, if any, of
shares of Common Stock which may be made subject to benefits under the
Plan; or (c) modify the requirements as to eligibility for benefits
under the Plan.
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<PAGE> 25
ANGELICA CORPORATION
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 24, 1994
The undersigned hereby appoints Leslie F. Loewe and Lawrence J. Young,
and each of them, the proxy of the undersigned, each with power of
substitution, to vote all shares which the undersigned would be
entitled to vote if personally present at the Annual Meeting of the
Shareholders of Angelica Corporation to be held on May 24, 1994, and at
any adjournment thereof; provided, however, that said shares shall be
voted as specified below:
1. ELECTION OF DIRECTORS:
For terms expiring in 1997: Leslie F. Loewe, Elliot H.
Stein, William P. Stiritz
To fill remainder of unexpired term (expiring in 1996):
Martin Sneider
/ / FOR all nominees listed.
/ / FOR all nominees listed except .................................
/ / WITHHOLD AUTHORITY to vote for all nominees listed.
2. Proposal to adopt and approve the Angelica Corporation 1994
Performance Plan. / / FOR / / AGAINST / / ABSTAIN
3. Approval of the material terms of the criteria to be used in the
grant of performance awards and performance-based restricted stock
awards under the Angelica Corporation 1994 Performance Plan.
/ / FOR / / AGAINST / / ABSTAIN
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS.
UNLESS OTHERWISE INDICATED ABOVE, THIS PROXY WILL BE VOTED FOR THE ELECTION
OF ALL OF THE ABOVE-LISTED NOMINEES; AND, UNLESS THE SHAREHOLDER
GIVES OTHER INSTRUCTIONS, WILL BE VOTED FOR ITEM 2 AND ITEM 3.
(Continued and to be signed on reverse side)
<PAGE> 26
4. In such manner as said proxies may in their discretion determine,
upon such other matters as may properly come before the meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1, 2 AND 3.
PLEASE FILL IN DATE AND SIGN AND RETURN PROXY IN THE ACCOMPANYING
BUSINESS REPLY ENVELOPE WHETHER OR NOT YOU EXPECT TO ATTEND IN PERSON.
DATE: ........................ , 1994
....................................
....................................
(SIGNATURE OF SHAREHOLDER(S))
(Please sign proxy exactly as name
appears hereon. Joint owners should
each sign personally. Corporate
proxies should be signed by
authorized officer. Executors,
administrators, trustees, etc.
should so indicate when signing.)
<PAGE> 27
APPENDIX
1. Page 13 of the printed Proxy contains a performance graph.
Pursuant to Item 304(d)(1) and Item 311(b) of Regulation S-T,
a copy of the performance graph has been filed under cover of Form SE.
