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
[ ] 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 Section 240.14a-11(c) or
Section 240.14a-12
Collins & Aikman Corporation
...............................................................................
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
...............................................................................
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or Item 22(a)(2) of Schedule 14A.
[ ] $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:
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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:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
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the offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form on Schedule and
the date of its filing.
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<PAGE>
May 31, 1995
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders of Collins & Aikman Corporation to be held on Thursday,
June 29, 1995 at The New York Palace Hotel, 455 Madison Avenue at 50th
Street, New York, New York, at 11:00 a.m., Eastern Daylight Savings
Time.
The formal notice of the meeting and the Proxy Statement follow,
which you are urged to read carefully. After reading them, please sign
and mail the enclosed proxy card so that your shares will be represented
at the meeting. A prepaid return envelope is provided for this purpose.
We look forward to seeing you at the meeting.
Sincerely,
/s/ Thomas E. Hannah
Thomas E. Hannah
Chief Executive Officer
<PAGE>
COLLINS & AIKMAN CORPORATION
701 McCullough Drive
Charlotte, North Carolina 28262
__________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held June 29, 1995
___________________
To the Stockholders of
COLLINS & AIKMAN CORPORATION:
NOTICE IS HEREBY GIVEN that the Annual Meeting (the "Meeting")
of the holders of Common Stock, par value $0.01 per share (the
"Common Stock"), of COLLINS & AIKMAN CORPORATION, a Delaware
corporation (the "Company"), will be held on Thursday, June 29, 1995,
at The New York Palace Hotel, 455 Madison Avenue at 50th Street, New
York, New York, commencing at 11:00 a.m., Eastern Daylight Savings
Time, for the purpose of considering and voting upon the following
matters:
(I) the election of three directors to hold office until the 1998
Annual Meeting and thereafter until their successors are elected and
qualified;
(II) the approval and ratification of the 1994 Directors Stock
Option Plan; and
(III) such other matters as may properly come before the Meeting
or any adjournment or postponement thereof.
The Board of Directors has fixed the close of business on May 26,
1995, as the record date for the determination of stockholders
entitled to notice of and to vote at the Meeting. Therefore, only
holders of record of Common Stock at the close of business on such
date will be entitled to notice of and to vote at the Meeting.
A complete list of stockholders entitled to notice of and to vote
at the Meeting will be available at the Company's offices at 210
Madison Avenue, 6th Floor, New York, New York, at least ten days prior
to the Meeting. The list will also be available for inspection by
stockholders at the Meeting on the day thereof.
Stockholders are requested to sign and date the enclosed proxy and
return it promptly in the enclosed pre-addressed reply envelope,
whether or not they plan to attend the Meeting, so that their shares
may be represented. Any proxy may be revoked by filing with the
Secretary of the Company in care of the First Union National Bank of
North Carolina at the address set forth in the accompanying proxy
statement either a written notice of revocation bearing a later date
than the proxy or a subsequent proxy relating to the same shares at any
time prior to the time the proxy is voted. Further, any person who has
executed a proxy and is present at the Meeting may vote in person
instead of by proxy, thereby canceling any proxy previously given.
By Order of the Board of Directors,
/s/ Elizabeth R. Philipp
Elizabeth R. Philipp
Secretary
PLEASE EXECUTE AND RETURN THE ENCLOSED PROXY CARD WHETHER OR NOT YOU
INTEND TO BE PRESENT AT THE ANNUAL MEETING.
May 31, 1995
<PAGE>
PROXY STATEMENT
__________
COLLINS & AIKMAN CORPORATION
701 McCullough Drive
Charlotte, North Carolina 28262
___________
ANNUAL MEETING OF STOCKHOLDERS
To Be Held June 29, 1995
General Information
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Collins & Aikman
Corporation, a Delaware corporation (the "Company"), of proxies for
use at the Annual Meeting of Stockholders of the Company to be held on
Thursday, June 29, 1995, at The New York Palace Hotel, 455 Madison
Avenue at 50th Street, New York, New York, commencing at 11:00
a.m., Eastern Daylight Savings Time, and at any adjournment or
postponement thereof (the "Meeting").
The presence, in person or by proxy, of stockholders holding a
majority of the shares entitled to vote at the Meeting is necessary to
constitute a quorum at the Meeting.
All shares of the Common Stock, par value $0.01 per share (the
"Common Stock"), of the Company which are entitled to vote and are
represented at the Meeting by properly executed proxies received
prior to or at the Meeting, and not revoked, will be voted at the
Meeting in accordance with the instructions indicated on such proxies.
If no instructions are indicated, such proxies will be voted to elect
the three nominees for director named below, in favor of approval and
ratification of the 1994 Directors Stock Option Plan (the "Directors
Plan") and in accordance with the Board of Directors' recommendations
with respect to any other matter that may properly come before the
Meeting.
The Board of Directors has fixed the close of business on May 26,
1995, as the record date (the "Record Date") for the determination of
stockholders entitled to notice of and to vote at the Meeting.
Therefore, only holders of record of Common Stock at the close of
business on the Record Date will be entitled to notice of and to vote at
the Meeting.
Any proxy may be revoked by the person giving it at any time before
it is voted. A proxy may be revoked by filing, with the Secretary of
the Company (in care of the First Union National Bank of North
Carolina, 230 South Tryon Street, Charlotte, North Carolina,
28288-1153, Attention: Tom Konetzny) at any time prior to the time the
proxy is voted, either a written notice of revocation bearing a later
date than the proxy or a subsequent proxy relating to the same
shares, or by attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute
revocation of a proxy).
All expenses of this solicitation, including the cost of preparing
and mailing this Proxy Statement, will be borne by the Company. In
addition to solicitation by use of the mails, proxies may be solicited
by directors, officers and employees of the Company in person or by
telephone, telegram or other means of communication. Such directors,
officers and employees will not be additionally compensated, but may
be reimbursed for out-of-pocket expenses in connection with such
solicitation. Arrangements will also be made with custodians,
nominees and fiduciaries for forwarding of proxy solicitation
materials to beneficial owners of shares of Common Stock held of record
by such custodians, nominees and fiduciaries, and the Company may
reimburse such custodians, nominees and fiduciaries for reasonable
expenses incurred in connection therewith. In addition, the Company
has retained Georgeson & Company Inc. to distribute proxy soliciting
materials to brokers, banks and institutional holders for a fee of
approximately $1,000, plus reasonable expenses.
This Proxy Statement and the accompanying proxy are being mailed to
stockholders commencing on or about May 31, 1995.
1
<PAGE>
Voting Securities and Principal Stockholders
On the Record Date, 70,520,900 shares of Common Stock were
outstanding. Only holders of Common Stock of record on the close of
business on the Record Date are entitled to notice of and to vote at
the Meeting. Each stockholder of record is entitled to one vote for
each share of Common Stock held on all matters to come before the
Meeting.
Set forth in the table below is certain information as of May 5,
1995, regarding the beneficial ownership of voting securities of the
Company by persons who are known to the Company to own beneficially
more than 5% of the Company's voting stock.
<TABLE>
<CAPTION>
Amount and
Nature of Percent
Name and Address Beneficial of
Title of Class of Beneficial Owner Ownership Class
<S> <C> <C> <C>
Common Stock Blackstone Capital Partners L.P. 26,131,107 (1) 37.1%
118 North Bedford Road, Suite 300
Mount Kisco, New York 10549
Wasserstein/C & A 27,629,573 (2) 39.2%
Holdings, L.L.C.
31 West 52nd Street
New York, New York 10019
</TABLE>
(1) Of these shares (i) 20,571,403 shares are held directly by
Blackstone Capital Partners L.P., a Delaware limited
partnership ("Blackstone Partners"), the sole general
partner of which is Blackstone Management Associates L.P.
("Blackstone Associates"), (ii) 1,061,413 shares are held
directly by Blackstone Family Investment Partnership II
L.P., a Delaware limited partnership ("BFIP"), the sole
general partner of which is Blackstone Associates, (iii)
93,291 shares are held directly by Blackstone Advisory
Directors Partnership L.P., a Delaware limited partnership
("BADP"), the sole general partner of which is Blackstone
Associates, and (iv) 4,405,000 shares are held directly by
Blackstone Capital Company II, L.L.C., a Delaware limited
liability company, all the ownership interest of which is
owned directly and indirectly by Blackstone Partners, BFIP
and BADP.
(2) These shares are held directly by Wasserstein/C & A
Holdings, L.L.C. (the "Wasserstein L.L.C."), which is
controlled by Wasserstein Perella Partners, L.P. ("WP
Partners"), the sole general partner of which is Wasserstein
Perella Management Partners, Inc. ("WP Management").
Executive officers and directors of the Company as a group
(13 persons) beneficially own 735,789 shares of Common Stock. For
further information regarding the securities ownership of the directors
of the Company, see "Directors' Ownership of Securities" below.
2
<PAGE>
The executive officers and former executive officers of the Company
named in the Summary Compensation Table set forth in this Proxy
Statement (and referred to herein as the "Named Executive Officers")
beneficially own the following securities of the Company as of May 5,
1995:
<TABLE>
<CAPTION>
Amount and Nature of
Title of Class Name of Beneficial Owner Beneficial Ownership Percent of Class
<S> <C> <C> <C>
Common Stock Thomas E. Hannah 491,718 (1) *
William J. Brucchieri 56,576 (2) *
John D. Moose 79,152 (3) *
Harry F. Schoen, III 65,602 (4) *
Elizabeth R. Philipp 37,741 (5) *
David J. McKittrick 0
Mark O. Remissong 0
David A. Stockman (6)
Bruce Wasserstein (6)
Stephen A. Schwarzman (6)
</TABLE>
* Less than one percent of shares of Common Stock outstanding.
(1) 490,718 represent shares underlying options granted under
the Company's 1993 Employee Stock Option Plan (the "1993
Plan") which vest June 1, 1995. 1000 shares are held
directly.
(2) 55,576 represent shares underlying options granted under the
1993 Plan which vest June 1, 1995. 1000 shares are held
directly.
(3) 78,652 represent shares underlying options granted under the
1993 Plan which vest June 1, 1995. 500 represent shares
held in a trust for the benefit of Mr. Moose's spouse. Mr.
Moose is not the trustee and does not exercise or share
investment control over the trust.
(4) Represent shares underlying options granted under the 1993
Plan which vest June 1, 1995.
(5) 36,741 represent shares underlying options granted under the
1993 Plan which vest June 1, 1995. 1000 shares are held
directly.
(6) See "Directors' Ownership of Securities".
3
<PAGE>
Voting. Blackstone Partners and its affiliates and the
Wasserstein L.L.C., which is controlled by WP Partners (collectively,
the "Partners") beneficially own or have the right to vote in the
aggregate approximately 76% of the outstanding Common Stock. See
"Certain Relationships". The Partners have advised the Company that
they intend to vote all such shares in favor of PROPOSAL I and
PROPOSAL II. Accordingly, the presence of a quorum at the Meeting and
the approval and adoption of PROPOSAL I and PROPOSAL II are assured.
PROPOSAL I
ELECTION OF DIRECTORS
The Restated Certificate of Incorporation provides that the Board
of Directors of the Company is divided into three classes serving
staggered three-year terms. Three directors will be elected at the
Meeting, each to hold office until his term expires at the 1998
Annual Meeting and until his successor is elected and qualified,
subject, however, to prior death, resignation, retirement,
disqualification or removal from office. All of the nominees
are presently directors of the Company. Proxies will be voted for
the election of the nominees listed below and identified as
Nominees for Election at the Meeting, unless contrary instructions
are set forth on the proxy card. If any nominee shall be
unavailable to serve as a director, proxies will be voted for the
election of such other person or persons as the Nominating Committee
of the Board of Directors or the Company may select. The Company is
not aware of any circumstances likely to render any nominee
unavailable. According to the By-laws of the Company, directors shall
be elected by a plurality of the votes cast. Therefore, the three
persons receiving the greatest number of votes cast at the Meeting
for the election of directors shall be elected as directors and
abstentions and broker non-votes will not affect the outcome of the
election.
Information as to Nominees and Other Directors
Set forth below, as of May 5, 1995, are the name, age and
principal occupation or employment during the last five years of each
nominee for election to the Board of Directors and all other
directors whose terms have not expired. None of the nominees or
other directors is related to any executive officer or other director
of the Company by blood, marriage or adoption. The affiliations
between the Company and WP Management, WP Group, WP & Co., Blackstone
and Blackstone Group (as such terms are defined below) are set forth
below under "Certain Relationships".
Management recommends that stockholders vote FOR the election of each
of Messrs. Hannah, Schwarzman and Wasserstein.
Nominees for Election at the Meeting - Class I Directors
Thomas E. Hannah, 56, has been a director of the Company and
Chief Executive Officer of the Company since July 1994. Mr.
Hannah was President and Chief Executive Officer of Collins & Aikman
Textile and Wallcoverings Group, a division of a wholly owned
subsidiary of the Company, from November 1991 until July 1994 and was
named an executive officer of the Company for purposes hereof in
April 1993. Mr. Hannah was President and Chief Executive Officer
of the Collins & Aikman Textile Group from February 1989 to
November 1991 and President of Milliken & Company's Finished Apparel
Division prior to that.
Stephen A. Schwarzman, 48, has been a director of the Company since
October 1988 and was President of the Company from October 1988 to
July 1994. Mr. Schwarzman has been Co-Founding Partner of Blackstone
Group Holdings L.P. (the "Blackstone Group"), which is under common
control with Blackstone Partners, and President and Chief Executive
Officer of The Blackstone Group L.P. ("Blackstone") since 1985. Mr.
Schwarzman is also a director of Great Lakes Dredge & Dock
Corporation and Transtar, Inc.
Bruce Wasserstein, 47, has been a director of the Company and
Co-Chairman of the Board of the Company since June 1992. Mr.
Wasserstein has been Chairman of WP Management since June 1992 and
Chairman or President, Wasserstein Perella Group, Inc. ("WP Group")
since 1988. Mr. Wasserstein is also Chairman of the Board of
Maybelline, Inc.
4
<PAGE>
Directors Whose Terms Expire at the 1996 Annual Meeting - Class II Directors
Dean Robert C. Clark, 51, has been a director of the Company since
October 1994. Mr. Clark is Dean of the Harvard Law School and Royall
Professor of Law. Mr. Clark joined Harvard Law School in 1979 after
four years at Yale Law School where he was a tenured professor, and
became Dean in 1989. Mr. Clark is a corporate law specialist
and author of numerous texts and legal articles. Prior to his
association with academia, he was in private practice with Ropes and
Gray, Boston. Dean Clark is also a director of Maybelline, Inc.
James J. Mossman, 36, has been a director of the Company since
January 1995. Mr. Mossman has been a general partner of Blackstone
Partners since 1990. Mr. Mossman is also a director of Chicago and
North Western Transportation Company, Great Lakes Dredge & Dock
Corporation and Transtar, Inc.
W. Townsend Ziebold, Jr., 33, has been a director of the Company
since December 1992. Mr. Ziebold has been a Managing Director of
Wasserstein Perella & Co., Inc. ("WP & Co.") since December 1994 and
was a Director of WP & Co. from December 1993 to December 1994. Mr.
Ziebold was Vice-President of WP & Co. from December 1991 to December
1993 and an Associate of WP & Co. from 1988 to December 1991. Mr.
Ziebold is also a director of Maybelline, Inc.
Directors Whose Terms Expire at the 1997 Annual Meeting - Class III Directors
David A. Stockman, 48, has been a director of the Company since
October 1988 and has been Co-Chairman of the Board of the Company since
July 1993. Mr. Stockman has been a General Partner of the Blackstone
Group since 1988. Prior to joining the Blackstone Group, Mr.
Stockman was a Managing Director of Salomon Brothers Inc. Mr.
Stockman served as the Director of the Office of Management and
Budget in the Reagan Administration from 1981 to 1985. Prior to that,
Mr. Stockman represented Southern Michigan in the U.S. House of
Representatives. Mr. Stockman is also a director of Edward J.
DeBartolo Corporation.
Randall J. Weisenburger, 36, has been a director of the Company
since August 1989 and has been Vice Chairman of the Company since
April 1994. Mr. Weisenburger was Deputy Chairman of the Company from
July 1992 to April 1994 and Vice President from August 1989 to July
1992. Mr. Weisenburger has been Managing Director of WP & Co. since
December 1993. Mr. Weisenburger was a Director of WP & Co. from
December 1992 to December 1993 and Vice President of WP & Co. from
December 1989 to December 1992. Mr. Weisenburger is also Vice
Chairman of the Board of Maybelline, Inc. and Chairman of the Yardley
Lentheric Group.
Certain Relationships. Blackstone Partners is a Delaware limited
partnership formed in 1987 for the purpose of, among other things,
(i) committing capital to facilitate corporate restructurings,
leveraged buyouts, bridge financings and other investments and (ii)
capitalizing affiliates that will engage in investment and merchant
banking activities. The sole general partner of Blackstone Partners
is Blackstone Associates, a Delaware limited partnership, whose
general partners include Messrs. Mossman, Schwarzman and Stockman.
At present, the business of Blackstone Associates consists of
performing the function of, and serving as, the general partner of
certain limited partnerships, including Blackstone Partners. Messrs.
Mossman, Schwarzman and Stockman are also general partners of
Blackstone Management Partners L.P. ("Blackstone Management").
WP Partners is a Delaware limited partnership, the general partner
of which is WP Management. Mr. Wasserstein is Chairman of WP
Management and Chairman of WP Group. WP Partners was formed by WP
Group for the purpose of participating in merchant banking activities,
including committing capital to the organization and consummation of
leveraged buyout transactions. WP Management and WP Group are both
Delaware corporations. WP Management is engaged in managing WP
Partners. WP Group is an international private advisory and
merchant banking firm. The principal subsidiary of WP Group is WP &
Co., an international investment banking firm.
Blackstone Partners and its affiliates and the Wasserstein
L.L.C., which is controlled by WP Partners, as of May 5, 1995
beneficially own 37.1% and 39.2%, respectively, of the outstanding
Common Stock and are in a position to control the Company.
Directors' Ownership of Securities. No director of the Company
beneficially owns any shares of Common Stock other than 491,718
shares owned by Mr. Hannah, 2,000 shares owned by Mr. Weisenburger,
3,000 shares owned by Mr. Ziebold
5
<PAGE>
and 10,000 shares underlying options granted to Mr. Clark pursuant to
the Directors Plan, if such plan is approved by the stockholders at
the Meeting. See "Voting Securities and Principal Stockholders"
and "PROPOSAL II". Messrs. Mossman, Schwarzman and Stockman, in
their capacities as general partners of Blackstone Associates,
collectively share with all general partners of Blackstone Associates
the power to vote and to dispose of 26,131,107 shares of Common
Stock which are held directly by partnerships, including Blackstone
Partners, of which Blackstone Associates is the sole general partner,
and a limited liability company, all the limited liability company
interest of which is owned directly and indirectly by partnerships
of which Blackstone Associates is the sole general partner. See
"Voting Securities and Principal Stockholders". Similarly, Mr.
Wasserstein, in his capacity as Chairman of WP Management, which is the
general partner of WP Partners, which controls the Wasserstein L.L.C.,
may be deemed to have the power to vote and to dispose of 27,629,573
shares of Common Stock held directly by the Wasserstein L.L.C.. See
"Voting Securities and Principal Stockholders". Mr. Weisenburger and
Mr. Ziebold are also officers of WP Management, although they do
not share the power to vote or dispose of the shares of Common
Stock held directly by the Wasserstein L.L.C. For purposes of this
filing under the Securities Exchange Act of 1934, as amended, Messrs.
Mossman, Schwarzman and Stockman, on the one hand, and Mr.
Wasserstein, on the other hand, may be deemed to be beneficial
owners, respectively, of such securities; however, each of Messrs.
Mossman, Schwarzman, Stockman and Wasserstein expressly disclaims
such beneficial ownership of any equity securities of the Company.
Certain Agreements. Blackstone Partners, WP Partners and the
Company have entered into an Amended and Restated Stockholders
Agreement (the "Stockholders Agreement") relating to the governance
and management of the Company and WP Partners and Blackstone
Partners have entered into a Voting Agreement (the "Voting Agreement")
relating to voting for nominees affiliated with each other. Pursuant
to the Voting Agreement, each Partner will be obligated to vote for
nominees to the Board of Directors that are affiliated with the
other Partner (and in certain circumstances, a transferee of the
other Partner). Pursuant to the Stockholders Agreement, each of WP
Partners, Blackstone Partners and the Company has a right of first
refusal with regard to sales of Common Stock by each Partner (with
certain exceptions). Each Partner also has the right to sell along
with the other (with certain exceptions). Under certain
circumstances, such as resignation of a director, the Company is
required to replace the director with an individual affiliated with
the same Partner as the former director.
The shares of Common Stock beneficially owned by Blackstone
Partners and their affiliates and the Wasserstein L.L.C. have, in each
case, been pledged to Chemical Bank in connection with the financing of
the purchase of a portion of those shares under a credit facility
with Chemical Bank and to secure the obligations of the pledgors
under such credit facility. Each credit facility with Chemical
Bank contains events of default typical for facilities of this type
(with customary qualifications and exceptions), including nonpayment
of principal or interest; violation of covenants; material
breaches of representations and warranties; bankruptcy; material
undischarged judgments; invalidity of security documents; Change in
Control (as defined therein); and insufficiency of Collateral Value
of the Stock Collateral (as defined therein).
Meetings and Committees of the Board of Directors.
Meetings and Attendance. In fiscal 1994, the Board of Directors held
a total of three meetings. All incumbent directors attended at least
75% of the aggregate of the total number of meetings held by the
Board and the total number of meetings held by the Committees on which
he served during the period for which he has been a director.
Committees of the Board. The Board of Directors has
designated the Audit Committee, which presently consists of Mr.
Clark, and the Compensation Committee, which consists of Messrs.
Stockman and Weisenburger. In addition, the Company's Restated
Certificate of Incorporation provides for the Nominating Committee,
which consists of Messrs. Clark, Mossman, Schwarzman, Stockman,
Wasserstein, Weisenburger and Ziebold.
The Audit Committee held one meeting in fiscal 1994. The Audit
Committee's function is to meet with the Company's independent
public accountants and with management to make inquiries regarding the
manner in which responsibilities of each are being discharged. The
Audit Committee reviews the scope of audit and non-audit assignments
and related fees, the Company's accounting principles, and the adequacy
of internal controls.
The Compensation Committee held one formal meeting in fiscal
1994. The Compensation Committee's function is to determine
compensation for executive officers of the Company other than
members of the Compensation Committee (who do not receive
compensation for serving as executive officers of the Company) and
deciding matters
6
<PAGE>
and policies with respect to the compensation of such executive
officers, including entering into employment agreements and granting
awards under and administering the option plans. The Compensation
Committee is not entitled to award or authorize any compensation to
be paid to any executive officer of the Company who is also a
partner or employee of Blackstone Partners, WP Partners or their
affiliates. See "COMPENSATION COMMITTEE REPORT ON EXECUTIVE
COMPENSATION".
The Nominating Committee held no meetings in fiscal 1994. The
Nominating Committee's function is to nominate, by a majority vote
thereof, persons for election to the Board of Directors at any annual
meeting of stockholders or at any special meeting of stockholders
called for the purpose of electing directors. Stockholders wishing
to recommend director candidates for consideration by the
Nominating Committee may do so by writing to the Secretary of the
Company, giving the recommended candidate's name, biographical data
and qualifications, not later than the date by which stockholder
proposals for action must be submitted. See "STOCKHOLDER PROPOSALS".
Pursuant to the Restated Certificate of Incorporation of the Company,
the Nominating Committee consists of all directors serving on the
Board of Directors, excluding directors that are salaried employees of
the Company.
PROPOSAL II
1994 DIRECTORS STOCK OPTION PLAN
The Board of Directors has adopted, effective as of November 1,
1994 (the "Effective Date"), subject to approval by the
stockholders of the Company, the Collins & Aikman Corporation 1994
Directors Stock Option Plan. The purposes of the Directors Plan are to
enable the Company to attract, retain and motivate outside directors
who are important to the success and growth of the business of
the Company and to create a long-term mutuality of interest
between the outside directors and the stockholders of the Company by
granting such directors options to purchase Common Stock. The
Directors Plan is only for non-management directors and directors not
affiliated with a major stockholder and provides for an automatic
grant every year as described more fully below. The full text of
the Directors Plan recommended by the Board of Directors is included
in this proxy statement as Annex A, and reference is made thereto
for a full statement of its terms and provisions.
The vote required for approval of PROPOSAL II is the affirmative
votes of the holders of a majority of the Common Stock present,
or represented by proxy, and entitled to vote. Accordingly, with
respect to PROPOSAL II, abstentions will have the effect of a
negative vote and broker non-votes will have no effect.
The Board of Directors believes that approval of the Directors
Plan is in the best interest of the Company and its stockholders and
therefore recommends a vote for this PROPOSAL II.
General
The Directors Plan authorizes the issuance of up to 600,000
shares of Common Stock upon the exercise of stock options
("Options") granted annually to each director of the Company who
is not an active employee of the Company or any subsidiary and
who is not an officer, director or employee of any entity which
directly or indirectly beneficially owns or controls 5% or more of the
total voting stock of the Company (or any subsidiary) or any entity
controlling, controlled by or under common control with such entity
(an "Eligible Director"). Of all the directors and nominees for
director, only Mr. Clark is an Eligible Director. The Directors Plan
provides for an automatic grant on February 23, 1995 (the date the
Directors Plan was approved by the Board of Directors) and on each
anniversary of the Effective Date thereafter of Options for 10,000
shares of Common Stock to each Eligible Director. The first such
grant, effective as of February 23, 1995, is conditioned on and
subject to the approval of the Directors Plan by the
stockholders of the Company. If the Directors Plan is not so approved,
any Options granted will be null and void. The Directors Plan
terminates on the seventh anniversary of the Effective Date and no
Options may be granted on or after that date.
Options issued under the Directors Plan will be exercisable at
the purchase price per share of 100% of the Fair Market Value of such
share at the time of the grant of the Option, or the par value of
the share, whichever is greater. Each Option is exercisable on or
after the later of (a) six months and one day after the date of grant
or (b) approval of the Directors Plan by the stockholders. Shares
purchased pursuant to the exercise of Options shall be paid for at
the time of exercise in cash or by delivery of unencumbered shares of
Common Stock owned by the director for at least six months (or such
longer period as required by applicable accounting standards to avoid a
charge to earnings) or a
7
<PAGE>
combination thereof.
Options granted under the Directors Plan are subject to restrictions
on transfer and exercise. No options may be exercised prior to
approval of the Directors Plan by the stockholders. No option may be
exercised after the expiration of ten years from the date of its
grant. Options that were exercisable prior to a termination of
directorship for any reason (including on account of disability,
death, resignation, failure to stand for reelection or failure to
be reelected or otherwise), shall remain exercisable by the
participant (or, in the case of death, by the participant's estate or
other authorized person) until the expiration of the Option in
accordance with the terms of the Directors Plan and its grant.
No Option shall be transferable otherwise than by will or under
applicable laws of descent and distribution or under a "qualified
domestic relations order" as defined in the Directors Plan.
All Options granted and not previously exercisable shall
become fully exercisable immediately upon a Change of Control (as
defined in the Directors Plan), provided the Directors Plan has been
approved by the stockholders prior to the time of the Change of
Control.
The Directors Plan provides for proportionate adjustments in the
number and kind of securities receivable upon the exercise of
Options in the event of a subdivision, recapitalization,
consolidation of the shares of Common Stock or the payment of a stock
dividend on shares without receipt of consideration or a merger or
consolidation in which the Company is the surviving corporation. Upon
a merger or consolidation in which the Company is not the surviving
corporation, of if the Company dissolves or is liquidated, then,
unless the surviving corporation assumes the Options or substitutes
new Options that are determined by the Board of Directors in its
sole discretion to be substantially similar and equivalent to the then
- - existing Options, upon the effective date of such merger,
consolidation, liquidation or dissolution, any unexercised Options
shall expire subject to the right of participants to exercise all
outstanding Options prior to such effective date (and the right of
participants subject to Section 16(b) of the Securities Exchange
Act of 1934 (the "Exchange Act") to exercise for a limited
period thereafter in the event their Options would not have vested
except for a Change of Control, provided such right is only to
receive whatever they would have received if they had exercised prior
to the effective date of the event).
As of the date hereof, Options for an aggregate of 10,000
shares have been granted to one director, subject to the approval
of the Directors Plan by the stockholders. The Directors Plan is
not qualified under Section 401(a) of the Internal Revenue Code and
is not subject to the Employee Retirement Income Security Act of 1974,
as amended.
On May 5, 1995, the Common Stock closed at $7.00 on the New York
Stock Exchange.
Federal Income Tax Consequences
The statutory provisions concerning the federal income tax
consequences with respect to the Options are subject to change, as
are their interpretations and applications. Therefore, the
following discussion of federal income tax consequences is
designed to provide a general understanding as of the date hereof. In
addition, the following discussion does not set forth any state or
local tax consequences that may be applicable.
The Options that may be granted pursuant to the Directors Plan are
nonqualified stock options ("NQSOs"). Because the NQSOs do not have
a readily ascertainable fair market value (as determined under
applicable tax law) at the time of grant, a director will realize no
taxable income upon the grant of a NQSO and the Company will not
receive a deduction at the time of such grant. Subject to the
discussion below, upon exercise of a NQSO the director generally will
realize ordinary income in an amount equal to the excess of the fair
market value of the Common Stock on the date of exercise over the
exercise price. Upon a subsequent sale of the Common Stock by a
director, the director will recognize short-term or long-term capital
gain or loss depending upon his or her holding period for the Common
Stock. The Company will generally be allowed a deduction equal to the
amount recognized by the director as ordinary income.
Directors who are granted Options pursuant to the Directors Plan
may be subject to special tax rules regarding the income tax
consequences concerning their NQSOs as a result of Section 16(b) of
the Exchange Act. As a result of Section 16(b) of the Exchange Act
and Section 83 of the Internal Revenue Code and the regulations
thereunder, the timing of income recognition may under certain
circumstances be deferred for any period following the exercise of
an Option (e.g., the six month period following such exercise) (the
"Deferral Period"). If there is a Deferral Period, absent
8
<PAGE>
a written election (under Section 83(b) of the Internal Revenue
Code) filed with the Internal Revenue Service within 30 days after
the date of transfer of the shares of Common Stock pursuant to the
exercise of the Option to include in income, as of the transfer date,
the excess (on such date) of the fair market value of such shares
over the exercise price, recognition of income by the director could,
in certain instances, be deferred until the expiration of the
Deferral Period.
New Plan Benefits
The table below shows Options that have been granted under the
Directors Plan, subject to the approval of the stockholders, to (i)
the Named Executive Officers, (ii) all current executive officers as a
group, (iii) all current directors who are not executive officers as
a group and (iv) all employees, including all current officers who
are not executive officers, as a group.
Stock Option Grants Under the Directors Plan
<TABLE>
<CAPTION>
Number of
Per Share Shares
Exercise Underlying Expiration
Name and Position Price Options Date
<S> <C> <C> <C>
Thomas E. Hannah........................ -0-
Chief Executive Officer
William J. Brucchieri..................... -0-
President of Imperial Wallcoverings
John D. Moose............................... -0-
President of Automotive Fabrics Division
Harry F. Schoen III........................ -0-
President of Mastercraft Division
Elizabeth R. Philipp....................... -0-
Executive Vice President, General Counsel and
Secretary
David J. McKittrick........................ -0-
Former Vice Chairman and Chief Operating Officer
Mark O. Remissong....................... -0-
Former Senior Vice President and
Chief Financial Officer
David A. Stockman........................ -0-
Co-Chairman of the Board and Former Co-CEO of
Collins & Aikman Group, Inc.
Bruce Wasserstein.......................... -0-
Co-Chairman of the Board and Former Co-CEO of
Collins & Aikman Group, Inc.
Stephen A. Schwarzman................ -0-
Former President
Current Executive Officers
as a Group.................................... -0-
Directors Who Are Not
Executive Officers as a Group... $7.625 10,000 February 23, 2005
Non-Executive Officer
Employee Group.......................... -0-
</TABLE>
Management recommends that stockholders vote FOR PROPOSAL II, the
approval and ratification of the Directors Plan.
9
<PAGE>
COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
The Company's executive compensation program is administered by the
Compensation Committee of the Board of Directors. The Committee is
responsible for the design, administration and oversight of all
senior management compensation and benefit policies, plans, programs
and agreements.
EXECUTIVE OFFICER COMPENSATION
The Company's compensation programs for its executive officers are
intended to recognize individual performance in conjunction with
overall corporate performance and to link a significant portion of
the compensation paid to executives with the Company's current and
long-term performance. The Compensation Committee believes that this
goal is best implemented by providing a compensation package
consisting of three major components: base salary, short-term incentive
compensation and long- term incentive compensation.
The Compensation Committee is not empowered to award or authorize any
compensation to be paid to any executive officer of the Company
who is also a partner or employee of Blackstone Partners, WP
Partners, Blackstone Group, WP Management or WP & Co.
BASE SALARY
When determining base salaries for the executive officers, the
Compensation Committee considers the Company's retention needs,
individual experience, performance and responsibilities. No relative
weights are assigned to any factor. In addition, the Compensation
Committee considers survey-based compensation data for companies of
similar size with jobs similar to those of the Company in
magnitude, complexity and scope of responsibility. While some of
the companies identified in the peer group performance graph
participate in these surveys, the Compensation Committee believes its
competitors for executive talent are broader than this group due to
the varied businesses in which its divisions compete for executive
talent. As a matter of policy, base salaries are generally targeted
at the 50th percentile of this broader group of textile and
general industry companies.
Salaries of executive officers are reviewed periodically by the
Compensation Committee, generally on a 12 to 18 month cycle. Salary
adjustments are determined by evaluating performance of the executive
and performance of the Company.
In the opinion of the Compensation Committee, competitive base salaries
contribute to the Company's overall performance by attracting and
retaining high quality management.
SHORT-TERM INCENTIVE COMPENSATION
The second major component of the executive compensation program is
the Company's Executive Incentive Compensation Plan (the "Bonus
Plan") adopted each year. The objectives of this plan are to:
(bullet) Motivate key employees to achieve and exceed the Company's
financial goals
(bullet) Maintain management's focus on the importance of earnings
(bullet) Encourage management to balance the longer-term needs of
the business with shorter-term requirements
(bullet) Attract and retain the quality of key employees required to
successfully manage the Company's businesses.
10
<PAGE>
Under the Bonus Plan, the Company's executive officers and other key
employees who are in a position to have an impact on the attainment
of the goals of the Company and its operating divisions have the
opportunity to earn annual performance bonuses. While the number of
persons participating in the Bonus Plan varies from year to year,
approximately 300 persons have participated each year. The bonuses
are based primarily on Earnings Before Interest and Taxes (EBIT). At
the beginning of the year, EBIT goals are established for Threshold
(lowest), Target (expected) and Maximum performance for each
operating division; such EBIT goals correspond generally with
Threshold, Target and Maximum bonus levels established for each
participant. The amount of bonus actually paid to participants is
based primarily on the extent to which unit performance meets or
exceeds the predetermined goals, thereby linking pay and unit
performance and can range from 50% (for Threshold) to 225% (for
Maximum) of the target award.
Four of the Named Executive Officers, as well as Mr. Hannah
(whose bonus is discussed separately below), received bonuses for
fiscal 1994 under the Bonus Plan. For such four Named Executive
Officers, the target bonuses assigned equalled 40% of base salary and
bonuses actually awarded ranged from approximately 11% of base
salary to approximately 94% of base salary. Imperial Wallcoverings,
Inc. did not meet its financial targets in fiscal 1994 under the
Bonus Plan, although every other operating division of the Company
met and exceeded such targets. The Chief Executive Officer used his
discretion under the Bonus Plan to award a fiscal 1994 bonus to the
Named Executive Officer responsible for Wallcoverings in recognition
of his achievements in revitalizing this business unit.
The bonus awarded to the former Vice Chairman and Chief Operating
Officer last year was not pursuant to the Bonus Plan, but pursuant to
his employment agreement, which guaranteed his bonus under certain
circumstances because, at the time his employment agreement was
negotiated, such guarantee was deemed necessary to retain the services
of such individual through his scheduled date of termination. See
"Employment Agreements".
LONG-TERM INCENTIVE
The third major component of the Company's executive compensation
program is its long-term incentive compensation plans. Through the
1993 Employee Stock Option Plan and the 1994 Employee Stock Option
Plan, the Company seeks to align the interests of key employees more
closely with those of the Company's shareholders, and to motivate
and reward actions which lead to long-term value creation for
shareholders. Stock option grants provide a direct link between
any rewards executives may receive and the results achieved for
shareholders. Stock options are intended to serve as compensation
over a period of several years and are therefore generally not
granted every year.
The Chief Executive Officer and the other four current executive
officers named in the Summary Compensation Table received grants in
fiscal 1993 under the 1993 Employee Stock Option Plan, which will
vest 50% in each of June 1995 and June 1996 for the Chief Executive
Officer and 40% in June 1995 with the remainder in June 1996 for
such other four executive officers. In light of these grants in
1993, there were no stock option grants in 1994 to the Chief
Executive Officer and the other four current executive officers named
in the Summary Compensation Table.
Stock option grants are made based on an evaluation of the
duties and responsibilities of the individual and his or her
present and potential contributions to the long-term growth and
success of the Company. Stock options granted to the Named Executive
Officers during the last fiscal year and year-end option values are
reflected in the tables provided below.
Prior to the implementation of the Company's option plans, the former
Vice Chairman and Chief Operating Officer became entitled under his
employment agreement to a phantom equity arrangement which, like the
option plans, was intended to create an incentive to achieve long
term goals of the Company. Upon such individual's termination of
employment, a payout was made under such arrangement pursuant to its
terms. See "Employment Agreements".
TERMINATION BENEFITS
The Company generally determines termination benefits of executive
officers based on the executive officer's employment agreement (if
applicable), the Company's general severance policies for "exempt
employees" (if applicable) or agreement with the departing executive
officer at the time of separation. During the last fiscal year,
amounts were paid to the former Vice Chairman and Chief Operating
Officer relating to his phantom equity and other benefits pursuant
to his employment agreement and certain termination benefits were
paid the former Chief Financial Officer pursuant to a
11
<PAGE>
severance agreement. See "Employment Agreements".
CHIEF EXECUTIVE OFFICER COMPENSATION
The compensation of the Company's Chief Executive Officer is
consistent with the compensation philosophy of the Company described
above. In July 1992, a subsidiary of the Company entered into an
employment agreement with Mr. Hannah. The agreement was amended in
February 1994 to increase his base salary to $525,000. This
increase was based on Mr. Hannah's increased level of responsibility in
the Company and his individual performance. These factors were
considered relative to comparable base salaries of the chief
executive officers in industries in which the Company competes. The
terms of Mr. Hannah's employment agreement are described under
"Employment Agreements" elsewhere in this Proxy Statement.
In addition to his base salary, Mr. Hannah is eligible to receive
annual incentive compensation under the Bonus Plan. Mr. Hannah's
target bonus opportunity equals 75 percent of current annual base
salary, with a maximum opportunity of 150 percent of current annual
base salary which the Compensation Committee exercised its
discretion to waive with respect to fiscal 1994 in view of the
Company's record performance. EBIT goals are established by the
Compensation Committee at the beginning of each fiscal year; award
calculations are based on the same factors as are bonuses for all
executive officers. In 1994, the Company's financial performance
exceeded the targets set by the Compensation Committee and resulted in
an above average incentive payout to Mr. Hannah. Mr. Hannah's annual
bonus award for the most recent fiscal year was $807,188.
The Compensation Committee, at its sole discretion, determines the
amount of any stock options to be granted to Mr. Hannah. During the
most recent fiscal year, no stock options were granted to Mr. Hannah in
view of grants made the previous year under the 1993 Employee Stock
Option Plan.
The Compensation Committee believes the total compensation program
for Mr. Hannah is competitive with that provided by comparable
companies, matches the responsibilities of his office and reflects
his personal contributions to the Company's performance.
DEDUCTIBILITY OF COMPENSATION IN EXCESS OF $1 MILLION A YEAR
In 1993, Congress enacted Section 162(m) of the U.S. Internal Revenue
Code of 1986, effective for tax years beginning in 1994. This
legislation precludes a public corporation from taking a federal
income tax deduction for compensation in excess of $1 million per
year for its chief executive officer and any of its four other
highest paid executive officers (with exceptions for certain
performance based compensation), although "grandfather" provisions may
apply to certain compensation arrangements that were entered into by a
corporation before it was publicly held. In view of the grandfather
provisions, the Company expects that this legislation will not limit
the Company's tax deductions for executive compensation for fiscal
1994 or under the Company's current compensation plans.
The Compensation Committee's policy is to qualify compensation
paid to its executive officers for deductibility for federal income
tax purposes to the extent feasible. However, to retain highly skilled
managers and remain competitive with other employers, the
Compensation Committee retains the authority to authorize other
payments, including salary and bonuses, that would not be deductible.
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF COLLINS & AIKMAN
CORPORATION:
DAVID A. STOCKMAN
RANDALL J. WEISENBURGER
12
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain information concerning the
compensation for services rendered to the Company and its
subsidiaries by (i) the Company's Chief Executive Officer, (ii) the
Company's four most highly compensated executive officers (other than
the Chief Executive Officer) whose total annual salary and bonus
exceeded $100,000 and who were serving as executive officers at the
end of the fiscal year ended January 28, 1995, (iii) two former
executive officers who would have been among the Company's four most
highly compensated executive officers but for the fact that they were
not serving as executive officers on January 28, 1995 and (iv) the
former President of the Company and the former Co-Chief Executive
Officers of Collins & Aikman Group, Inc. (the individuals named in
clauses (i) through (iv) being referred to in this Proxy Statement
as the "Named Executive Officers"). All compensation shown has been
paid by Collins & Aikman Products Co., a wholly owned subsidiary of
the Company ("Products"), or by a subsidiary of Products (although
the options shown as awarded are for Common Stock of the
Company). The Company does not separately compensate its executive
officers for their duties as officers of the Company (except for any
such options).
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
Other Awards Payouts
Name and Annual Securities All Other
Principal Year Salary Bonus Compensation Underlying LTIP Compensation
Position (1) ($) ($) ($) Options (#) Payouts ($) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
Thomas E. Hannah 1994 515,833 807,188 4,030 (2) 0 0 34,190 (3)
Chief Executive Officer 1993 415,000 783,960 (2) 981,435 2,319,907 (4) 17,153
1992 407,500 630,800 (2) 0 0 22,014
William J. Brucchieri 1994 233,333 25,000 (2) 0 0 1,125 (5)
President, Imperial 1993 225,000 25,000 14,342 (2) 138,941 85,829 (4) 1,309
Wallcoverings, Inc. 1992 171,250 52,500 25,546 (6) 0 0 2,916
John D. Moose 1994 295,417 279,000 83,200 (7) 0 0 11,215 (8)
President, Automotive 1993 262,500 119,900 (2) 196,629 417,122 (4) 9,568
Fabrics Division 1992 253,750 122,720 (2) 0 0 9,775
Harry F. Schoen, III 1994 266,667 247,500 (2) 0 0 10,385 (9)
President, Mastercraft 1993 250,000 112,000 (2) 164,005 192,582 (4) 8,536
Division 1992 174,167 83,490 (2) 0 0 1,269
Elizabeth R. Philipp 1994 270,000 241,400 (2) 0 0 10,647 (10)
Executive Vice President, 1993 256,250 120,000 (2) 91,853 77,433 (4) 9,364
General Counsel, 1992 246,667 100,000 (2) 0 0 19,566
and Secretary
David J. McKittrick 1994 199,834 87,500 16,900 (2) 0 470,137 (11) 60,295 (12)
Former Vice Chairman 1993 350,000 175,000 (13) 244,667 (14) 0 0 11,236
of the Company and Chief 1992 271,923 (15) 175,000 (2) 0 0 914
Operating Officer (16)
Mark O. Remissong 1994 230,000 0 54,370 (17) 0 (18) 0 106,894 (19)
Former Senior Vice 1993 31,254 0 0 0 0 0
President and Chief 1992 0 0 0 0 0 0
Financial Officer (20)
David A. Stockman 1994 27,500 (21) 0 0 0 0 0
Co-Chairman of the Board 1993 15,000 (21) 0 0 0 0 0
and Former Co-Chief 1992 15,000 (21) 0 0 0 0 0
Executive Officer of
Collins & Aikman Group, Inc.
Bruce Wasserstein 1994 27,500 (21) 0 0 0 0 0
Co-Chairman of the Board 1993 15,000 (21) 0 0 0 0 0
and Former Co-Chief 1992 7,500 (21)(22) 0 0 0 0 0
Executive Officer of
Collins & Aikman Group, Inc.
Stephen A. Schwarzman 1994 27,500 (21) 0 0 0 0 0
Former President 1993 15,000 (21) 0 0 0 0 0
of the Company 1992 15,000 (21) 0 0 0 0 0
</TABLE>
13
<PAGE>
(1) The information given in this table is for the fiscal years
indicated, not calendar years. 1994 indicates the fiscal year
ended January 28, 1995. 1993 indicates the fiscal year ended
January 29, 1994. 1992 indicates the fiscal year ended January
30, 1993.
(2) Total perquisites for executive officer were less than the
lesser of $50,000 or 10% of annual salary and bonus and
accordingly the dollar value of such perquisites is not shown.
Perquisites for an executive officer may, but do not
necessarily, include reimbursement for any of the following
expenses: car; financial planning; executive fitness;
executive physicals and medical; luncheon club; and relocation.
(3) Amount for fiscal 1994 for Mr. Hannah consists of (i)
contributions to the Collins & Aikman Corporation Profit Sharing
Plan, a defined contribution plan (the "PSP"), in the amount of
approximately $3,000, (ii) contributions to the non- qualified
supplement to the PSP (the "SPSP") in the amount of
approximately $22,812, (iii) premiums in the amount of $2,484
and $1,359 paid for basic term life insurance and Accidental
Death & Dismemberment insurance ("AD&D insurance"), respectively,
under group life insurance policies and (iv) $4,535 for medicare
tax withholding on accrued non-qualified retirement benefits.
(4) The amounts represent payouts in November 1993 under the Equity
Share Plan, which was terminated in October 1993. In connection
with such termination, certain conditions as to the vesting of
awards were modified as follows: Mr. Hannah (approximately
$464,000 of the amount shown as a payout was attributable
to such modification); Mr. Brucchieri (approximately $18,400
was attributable to such modification); Mr. Schoen
(approximately $41,300 was attributable to such modification);
Mr. Moose (approximately $89,400 was attributable to such
modification); and Ms. Philipp ($12,000 of the amount shown as
a payout was due to a supplemental payout and approximately
$24,500 was attributable to such modification).
(5) Amount for fiscal 1994 for Mr. Brucchieri consists of premiums in
the amount of $960 and $165 paid for basic term life insurance
and AD&D insurance, respectively, under group life insurance
policies.
(6) Reimbursement of relocation expenses for Mr. Brucchieri's move to
Cleveland, Ohio.
(7) Includes $31,254 for reimbursement of relocation for costs for
Mr. Moose's move to Roxboro, North Carolina, and $17,165 for
gross-ups of relocation reimbursements to compensate the
executive for incremental federal and state income taxes and
$25,833 (an amount equal to one month's salary) for miscellaneous
additional moving expenses.
(8) Amount for fiscal 1994 for Mr. Moose consists of (i)
contributions to the PSP in the amount of $3,000, (ii)
contributions to the SPSP in the amount of $5,248 and (iii)
premiums in the amount of $2,484 and $483 paid for basic term
life insurance and AD&D insurance, respectively, under group life
insurance policies.
(9) Amount for fiscal 1994 for Mr. Schoen consists of (i)
contributions to the PSP in the amount of $3,000, (ii)
contributions to the SPSP in the amount of $4,532 and (iii)
premiums in the amount of $2,484 and $369 paid for basic term
life insurance and AD&D insurance, respectively, under group life
insurance policies.
(10) Amount for fiscal 1994 for Ms. Philipp consists of (i)
contributions to the PSP in the amount of approximately $3,000,
(ii) contributions to the SPSP in the amount of approximately
$4,800 and (iii) premiums in the amount of $2,484 and $363 paid
for basic term life insurance and AD&D insurance, respectively,
under group life insurance policies.
(11) Represents payout upon termination of employment of the vested
portion of the phantom equity awarded pursuant to Mr.
McKittrick's employment agreement. See "Employment Agreements".
(12) Amount for fiscal 1994 for Mr. McKittrick consists of (i)
premiums in the amount of $1,242 and $322 paid for basis term
life insurance and AD&D insurance, respectively, under group
life insurance policies, (ii) a severance payment of $17,000
and (iii) reimbursement upon termination of employment for
unused vacation pay in the amount of $41,731. See "Employment
Agreements".
(13) Mr. McKittrick's bonus for fiscal 1993 was $175,000. An
additional $200,000, representing the portion of Mr.
McKittrick's phantom equity award vested during fiscal 1993, was
reported under the bonus column in last year's Summary
Compensation Table. Since such amount was actually paid in
fiscal 1994, it has been included instead in the amount set forth
under LTIP payouts for fiscal 1994 in lieu of being included in
the bonus column for fiscal 1993.
(14) Includes $228,204 reimbursement for relocation costs in
connection with Mr. McKittrick's move to Charlotte, North
Carolina, including gross-ups of relocation reimbursements to
compensate the executive for incremental federal and state income
taxes.
(15) Includes salary for the period from March 23, 1992 through
January 30, 1993, the portion of fiscal year 1992 during which
Mr. McKittrick was an executive officer of the Company.
(16) Mr. McKittrick was appointed Vice Chairman of the Company and
Vice Chairman and Chief Operating Officer of Collins & Aikman
Group, Inc., a predecessor of Products on March 23, 1992. Prior
to that date, Mr. McKittrick held no positions with the Company
or its subsidiaries. Mr. McKittrick resigned as an executive
officer of the Company and any of its subsidiaries on April 4,
1994, and his employment with the Company and any of its
subsidiaries terminated on July 30, 1994. See "Employment
Agreements".
14
<PAGE>
(17) Includes $29,207 for reimbursement of relocation costs in
connection with Mr. Remissong's move to Charlotte, North
Carolina, and $20,295 for gross-ups of relocation reimbursements
to compensate the executive for incremental federal and state
income tax and $2,133 in imputed interest (assuming a market
rate).
(18) Options were awarded to Mr. Remissong pursuant to the 1994
Employee Stock Option Plan but were canceled pursuant to the
terms of such plan upon Mr. Remissong's termination of
employment since none of the such options had vested prior to
termination. See "Option Grants in Last Fiscal Year".
(19) Amount for fiscal 1994 for Mr. Remissong consists of (i)
contributions to the PSP in the amount of $3,000, (ii)
contributions to the SPSP in the amount of $1,600, (iii) premiums
in the amount of $2,095 and $199 for basic term life insurance
and AD&D insurance, respectively, under group life insurance
policies and (iv) $100,000 supplemental severance payment under
Mr. Remissong's severance agreement paid in March 1995. See
"Employment Agreements".
(20) Mr. Remissong was appointed Senior Vice President and Chief
Financial Officer of a wholly owned subsidiary of the Company
on December 13, 1993 and held no positions with the Company
or it subsidiaries prior to that date. Mr. Remissong's
employment with the Company and its subsidiaries terminated
on October 14, 1994. See "Employment Agreements".
(21) Represents compensation for serving on the Board of Directors of
the Company. Mr. Stockman, Mr. Wasserstein and Mr. Schwarzman
received no other compensation during the years shown for serving
on the Board of Directors of the Company or for serving as
executive officers of the Company or any of its subsidiaries,
including Products.
(22) Mr. Wasserstein was elected as director and appointed
Co-Chairman of the Board of Directors of the Company effective
June 15, 1992 and Co-Chairman of the Board of Directors and
Co-Chief Executive Officer of Collins & Aikman Group, Inc.,
effective June 19, 1992.
Option Grants In Last Fiscal Year
Shown below is further information on grants of stock options
for the fiscal year ended January 28, 1995, to the Named Executive
Officers. No grants of stock options were made during the fiscal year
ended January 28, 1995, to the Named Executive Officers, other than
options awarded to Mr. Remissong pursuant to the 1994 Employee Stock
Option Plan, which were canceled pursuant to the terms of such plan upon
Mr. Remissong's termination of employment because none of such options
had vested prior to termination.
<TABLE>
<CAPTION>
Number of
Securities % of Total
Underlying Options Granted Exercise
Options to Employees Price Expiration Grant Date
Name Granted (#) in Fiscal 1994 ($/sh)(2) Date Present Value ($)(3)
<S> <C> <C> <C> <C> <C>
Thomas E. Hannah 0 0 N/A N/A N/A
William J. Brucchieri 0 0 N/A N/A N/A
John D. Moose 0 0 N/A N/A N/A
Harry F. Schoen, III 0 0 N/A N/A N/A
Elizabeth R. Philipp 0 0 N/A N/A N/A
David J. McKittrick 0 0 N/A N/A N/A
Mark O. Remissong 44,735(1) 23.97 4.43 April 15, 2004 579,086
33,267(1) 17.82 8.26 April 15, 2004 377,243
David A. Stockman 0 0 N/A N/A N/A
Bruce Wasserstein 0 0 N/A N/A N/A
Stephen A. Schwarzman 0 0 N/A N/A N/A
</TABLE>
(1) All such options were canceled on October 14, 1994 pursuant to
the terms of the 1994 Employee Stock Option Plan as they were
unvested at the date of Mr. Remissong's termination of
employment.
(2) "N/A" appearing in the table denotes not applicable since no
options were granted to the Named Executive Officer.
(3) Option values reflect Black-Scholes model output for
options. The assumptions used in the model were expected
volatility of 30%, risk-free rate of return of 7.52%,
dividend yield of 0% and time to exercise of ten years.
Additionally, no liquidity discount or forfeiture discount was
applied.
15
<PAGE>
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option
Values
Shown below is information with respect to the year-end value of
unexercised options to purchase Common Stock granted to the Named
Executive Officers and held by them as of January 28, 1995. The
value of in-the-money options is based on the difference between the
exercise price of such options and the closing price of the Common
Stock on the New York Stock Exchange on January 27, 1995 (the last
trading day of the fiscal year ended January 28, 1995), which was
$8.50.
<TABLE>
<CAPTION>
Number of Securities Underlying
Unexercised Options at Value of Unexercised
FY-End (#) In-The-Money-Options at FY-End ($)
Shares Acquired Value
Name On Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Thomas E. Hannah 0 0 0 841,230 0 3,793,947
140,205 33,649
William J. Brucchieri 0 0 0 77,184 0 348,100
61,757 14,822
John D. Moose 0 0 0 146,555 0 660,963
50,074 12,018
Harry F. Schoen, III 0 0 0 97,998 0 441,971
66,007 15,842
Elizabeth R. Philipp 0 0 0 83,508 0 376,621
8,345 2,003
David J. McKittrick 0 0 0 0 0 0
Mark O. Remissong 0 0 0 0 0 0
David A. Stockman 0 0 0 0 0 0
Bruce Wasserstein 0 0 0 0 0 0
Stephen A. Schwarzman 0 0 0 0 0 0
Defined Benefit or Actuarial Plan Disclosure
Messrs. Stockman, Wasserstein and Schwarzman have never
participated in and have not received and will not receive any
benefits under the C&A Co. Plan, the C&A Co. Excess Benefit Plan or
the C&A Co. SRIP Plan described below. See "Summary Compensation
Table", footnote 21.
C&A Co. Plan. Provided certain eligibility requirements are met,
at the end of each calendar month, pay credits are applied to a
participant's account under the Collins & Aikman Corporation
Employees' Pension Account Plan (the "C&A Co. Plan") based on the
participant's length of credited service and compensation (as defined)
during that month. For participants aged 50 or older, the monthly pay
credit is based on either credited service and compensation or age and
compensation, whichever results in the higher amount.
The following chart sets forth how pay credits are determined under the
C&A Co. Plan:
</TABLE>
<TABLE>
<CAPTION>
Percentage of
Compensation Used to
Determine Pay Credits
Eligibility Requirements Up to 1/3 Over 1/3
Years Of of the S.S. of the S.S.
Credited Service or Age Wage Base Wage Base
<S> <C> <C> <C>
less than 10 less than 50 2.5% 4.5%
10 - 14 50 - 54 3.0% 5.5%
15 - 19 55 - 59 4.0% 6.5%
20 - 24 60 - 64 5.0% 8.0%
25 or more 65 or more 6.0% 10.0%
</TABLE>
The dollar amounts that result from these percentages are added
together and the total is the pay credit for the month.
16
<PAGE>
In addition, interest credits are applied each month to
the account balance. Participants make no contributions to the C&A
Co. Plan. Employer contributions are 100% vested after five years of
service or at age 65, whichever is earlier, and may vest under certain
other circumstances as set forth in the C&A Co. Plan. The
estimated annual benefits payable upon retirement at normal retirement
age under the C&A Co. Plan for Messrs. Hannah, Brucchieri, Moose,
Schoen and McKittrick and Ms. Philipp are $20,185, $12,741,
$49,889, $6,391, $4,803 and $20,225, respectively. Participants in the
C&A Co. Plan have the option, however, of receiving the value of their
vested account in a lump sum following termination of employment. Mr.
McKittrick has not yet elected to receive his benefit payment. Mr.
Remissong's account under the C&A Co. Plan was not vested at
termination of his employment and he will receive no benefit under the
C&A Co. Plan.
C&A Co. Excess Plan. The Excess Benefit Plan of Collins &
Aikman Corporation (the "C&A Co. Excess Plan") works in conjunction
with the C&A Co. Plan (which is described above) and provides to the
employee any benefit which the C&A Co. Plan would have provided but for
certain legal limitations under the Employee Retirement Income
Security Act of 1974 and Internal Revenue Service regulations. The
pay credits and interest credits are determined as described with
respect to the C&A Co. Plan as if no legal limitations existed, and
then this plan provides any benefit which is in excess of the
benefit provided under the C&A Co. Plan. The estimated annual benefits
payable upon retirement at normal retirement age under the C&A Co.
Excess Plan for Messrs. Hannah, Brucchieri, Moose and Schoen and Ms.
Philipp are $35,066, $1,296, $14,967, $2,247, and $7,389, respectively.
In lieu of annual benefits at retirement, Mr. McKittrick elected to
receive a lump sum benefit under the C&A Co. Excess Plan following his
termination of employment and received the amount of approximately
$19,630 in payment thereof. Mr. Remissong's account under the C&A Co.
Excess Plan was not vested at termination of his employment and he will
receive no benefit under the C&A Co. Excess Plan.
C&A Co. SRIP. Participation in the Collins & Aikman Corporation
Supplemental Retirement Income Plan (the "C&A Co. SRIP") is solely at the
discretion of the Board of Directors of Products and is extended to a
select group of key executives. The plan provides a participating
employee with a retirement benefit at or after age 62. A target
benefit is first calculated for each employee based on Total Annual
Compensation (final base salary plus the average of the bonuses paid
for the last three fiscal years) and years of service at retirement.
The benefit payable from the C&A Co. SRIP is determined as the excess
of the target benefit over any pension benefits payable from Social
Security and any other retirement plans sponsored by the Company.
An employee does not become vested in a benefit until reaching age 62.
The following table shows, for specified
compensation/years of service classifications, the hypothetical
annual target benefits under the C&A Co. SRIP for employees
retiring at age 65, assuming that the retiring participant elects a
single life annuity.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
Total Annual Years of Service
Compensation 10 15 20 25 30 35 41
<S> <C> <C> <C> <C> <C> <C> <C>
$ 200,000 $ 84,000 $102,000 $120,000 $120,000 $120,000 $120,000 $120,000
225,000 94,500 114,750 135,000 135,000 135,000 135,000 135,000
250,000 105,000 127,500 150,000 150,000 150,000 150,000 150,000
275,000 115,500 140,250 165,000 165,000 165,000 165,000 165,000
300,000 126,000 153,000 180,000 180,000 180,000 180,000 180,000
350,000 147,000 178,500 210,000 210,000 210,000 210,000 210,000
400,000 168,000 204,000 240,000 240,000 240,000 240,000 240,000
450,000 189,000 229,500 270,000 270,000 270,000 270,000 270,000
500,000 210,000 255,000 300,000 300,000 300,000 300,000 300,000
600,000 252,000 306,000 360,000 360,000 360,000 360,000 360,000
700,000 294,000 357,000 420,000 420,000 420,000 420,000 420,000
800,000 336,000 408,000 480,000 480,000 480,000 480,000 480,000
900,000 378,000 459,000 540,000 540,000 540,000 540,000 540,000
1,000,000 420,000 510,000 600,000 600,000 600,000 600,000 600,000
1,100,000 462,000 561,000 660,000 660,000 660,000 660,000 660,000
1,200,000 504,000 612,000 720,000 720,000 720,000 720,000 720,000
1,300,000 546,000 663,000 780,000 780,000 780,000 780,000 780,000
1,400,000 588,000 714,000 840,000 840,000 840,000 840,000 840,000
1,500,000 630,000 765,000 900,000 900,000 900,000 900,000 900,000
</TABLE>
17
<PAGE>
Messrs. Hannah, Brucchieri, Moose and Schoen are the only
named executive officers participating in the C&A Co. SRIP. Mr. Hannah
currently has six years of plan service, and at age 65, he will have
an estimated 14 years, 5 months of plan service. Mr. Brucchieri
currently has 7 years, 1 month of plan service and at age 65 will
have an estimated 19 years, 6 months of plan service. Mr. Moose
currently has 34 years, 7 months of plan service and at age 65 will
have an estimated 41 years, 4 months of plan service. Mr. Schoen
currently has 2 years, 9 months of plan service and at age 65 will
have an estimated 8 years, 7 months of plan service.
Employment Agreements
In July 1992, Products entered into an employment agreement with
Mr. Hannah, which was amended as of February 1994. The agreement, as
amended, provides for an initial base salary of $525,000 and
participation in any executive bonus plan, with a target bonus of 75%
of the base salary then in effect up to a maximum of 150% of base
salary. The agreement expires January 31, 1997, with automatic one
year renewals thereafter unless Products notifies Mr. Hannah prior
to that time of its intention to terminate the agreement. In the
event of involuntary termination for reasons other than cause and other
than a change of control, the agreement provides for severance
benefits equal to Mr. Hannah's base salary then in effect for a period
of one year from the termination date plus any unpaid cash bonus for
the prior fiscal year and a pro rata portion of any bonus he would have
received had he been employed for the entire fiscal year. Products
also entered into a letter agreement with Mr. Hannah in May 1991
pursuant to which Mr. Hannah is entitled to receive an amount equal to
two times his base salary then in effect in the event his employment is
terminated by Products within three months prior to or one year
following a change of control (as defined) of Products.
In May 1991, Products entered into a letter agreement with Mr. Moose
which provides that if his employment is terminated by Products or any
successor company other than for cause at any time within three months prior to
or one year following a change of control (as defined) of Products,
then in lieu of any severance available under policies or practices
of Products he shall receive an amount equal to two times his base
salary as in effect at the time of termination.
In July 1990, Products entered into an employment agreement with
Ms. Philipp at an initial base salary of $225,000 per year. The
agreement is automatically renewed each year. In the event of
involuntary termination for reasons other than cause, including
failure to renew the agreement, any requirement that Ms. Philipp's
office be relocated or any change in control (as defined), the agreement
provides for severance benefits equal to Ms. Philipp's base salary then
in effect for a period of one year from the termination date plus the
pro rata portion of any cash bonuses she would have received had she
been employed for the entire fiscal year.
In March 1992, the Company entered into an employment agreement
with Mr. McKittrick, which was amended as of April 1994. The
agreement, as amended, provided for an initial base salary of $350,000
per year and a cash bonus of not less than $87,500 for the six months
ending July 30, 1994. Pursuant to the agreement, as amended, Mr.
McKittrick ceased to be Vice Chairman on April 4, 1994 and became
principal financial and accounting officer with limited responsibilities
for a transitional period. The term of the agreement, as amended,
ended July 30, 1994. In the event of termination for reasons other
than cause (including for this purpose the expiration of the term of
employment), the agreement, as amended, also provided for payment of
(i) the amount of $17,000 as a retirement severance benefit in addition
to the value of Mr. McKittrick's vested accounts under the PSP and C&A
Co. Plan plus (ii) any amount payable with respect to Mr.
McKittrick's phantom equity award. Mr. McKittrick's award, which was
made pursuant to his employment agreement, represented phantom equity
in the Company in the amount of $1,000,000 and vested at the rate of
$200,000 per year, with cliff vesting for the first two years and
continuous vesting thereafter. Mr. McKittrick's employment terminated
on July 30, 1994. Mr. McKittrick received the vested portion of
his phantom equity in the amount of $470,137 following his termination
of employment.
In October 1994, Products entered into an agreement (the
"Severance Agreement") with Mr. Remissong pursuant to which its
earlier employment agreement with Mr. Remissong and all respective
rights and obligations were terminated. Pursuant to the
Severance Agreement, Mr. Remissong receives as severance on a
periodic basis his base salary of $230,000 per year for the period
through October 31, 1995 and also received a supplemental payment of
$100,000 in March 1995.
18
<PAGE>
PERFORMANCE GRAPH
The following graph compares the cumulative total stockholder
return from July 7, 1994 (the date the Common Stock was first
registered under Section 12 of the Exchange Act and traded on the New
York Stock Exchange) through January 28, 1995 of the Company, the S&P
500 and a peer group of companies selected by the Company for
purposes of the comparison and more fully described below (the "Peer
Group"). Dividend reinvestment has been assumed and, with respect to
the companies in the Peer Group, the returns of each such company
have been weighted to reflect relative stock market capitalization.
The graph assumes an investment of $100 on July 7, 1994 in each of
the Common Stock, the stocks comprising the S&P 500 and the stocks
comprising the Peer Group.
Line graph depicting the change in a $100 investment made on July 7, 1994
through January 28, 1995 in (1) the Common Stock of the Company,
(2) the S&P 500 and (3) a peer group of companies. Dollar values at
January 28, 1995 are indicated in the chart below.
July 7, January 28,
1994 1995
Collins & Aikman Corporation $ 100.00 $ 80.95
S&P 500 $ 100.00 $ 107.02
Peer Group* $ 100.00 $ 87.16
* The Company does not believe that there is a single published
industry or line of business index that is appropriate for comparing
stockholder return. The Peer Group selected by the Company is made
up of companies which supply similar customers in the Automotive
Products, Interior Furnishings and Wallcoverings markets as well as
companies with which the Company believes it competes for managers.
The Peer Group consists of Masland Corporation, Lear Seating
Corporation, Burlington Industries, Inc., Quaker Fabric Corporation,
Culp, Inc., Norwall Group Inc., Fieldcrest Cannon, Inc. and Cone
Mills Corporation.
19
<PAGE>
COMPENSATION OF DIRECTORS
Each director of the Company and Products who is not a full-time
employee thereof (or the Partner who designates such director to the
Board of Directors) receives a fee of $40,000 per year, payable
quarterly. Such fee commenced in the third quarter of fiscal 1994.
Prior to that time, each such director received a fee of $15,000 per
year.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee is currently comprised of Mr. Stockman,
Co-Chairman of the Board of the Company, and Mr. Weisenburger, Vice
Chairman of the Company. Neither Mr. Stockman nor Mr. Weisenburger
is separately compensated for serving as an executive officer of
the Company or any of its subsidiaries, including Products. See
"COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION". Mr.
Stockman and Mr. Weisenburger participated in deliberations during
the last completed fiscal year concerning compensation of
executive officers who are separately compensated for serving as
executive officers. None of the executive officers who are
separately compensated for serving as
executive officers (or who received options) serve on the Compensation
Committee.
Mr. Stockman is a general partner of Blackstone Group,
Blackstone Management and Blackstone Associates. Mr. Weisenburger is
a Managing Director of WP & Co., which is a subsidiary of WP Group.
WP Group formed WP Partners. See "Certain Relationships" and
"Directors' Ownership of Securities".
Under the Stockholders Agreement prior to its amendment in
connection with the Company's public offering of common stock in July
1994, the Company had agreed to pay to each of Blackstone Management
and WP & Co. or their affiliates an annual operating management
fee of $1 million, payable annually, and an annual management and
retainer services fee of $1.5 million, payable quarterly in advance.
The Company also reimbursed Blackstone Management and WP & Co. or
their affiliates for out-of-pocket expenses in connection with their
management. Since the beginning of fiscal 1994, $1,750,000 was paid to
each of Blackstone Management and WP & Co. or their affiliates
pursuant to the Stockholders Agreement prior to its amendment.
Pursuant to the Stockholders Agreement as it was amended, each of
Blackstone Partners and WP Partners or their affiliates receive a $1
million annual monitoring fee and the reimbursement of expenses from
the Company. Since the beginning of fiscal 1994, $500,000 was paid to
each of Blackstone Partners and WP Partners or their affiliates pursuant
to the Stockholders Agreement as it was amended.
The Board of Directors of the Company has authorized the investment
by Products from time to time of amounts not to exceed $5 million in a
short-term investment fund to which Blackrock Financial Management L.P.
serves as investment advisor. Blackrock Financial Management L.P.,
an affiliate of Blackstone Group, charges annual management fees equal
to .3% of the amount invested, plus nominal out of pocket expenses.
Since the beginning of fiscal 1994, the Company has paid Blackrock
Financial Management L.P. fees in the amount of approximately $6,000.
Since the beginning of fiscal 1994, Products has paid $1,394,000 to
each of Blackstone Partners and WP Partners or their affiliates for
services rendered in connection with the divestiture of Kayser-Roth
Corporation.
In September 1993, Blackstone entered into an agreement with
Products to provide advisory services and assistance in connection with
the sale or disposition by Products of its Builders Emporium Division.
The Agreement provides for reimbursement of out-of-pocket expenses plus
payment of fees to be paid by Products to Blackstone of (i) $100,000
per fiscal month, commencing with the fiscal month ending September 25,
1993 and ending with the fiscal month ending January 29, 1994 and
(ii) $100,000 for the fiscal quarter commencing January 30, 1994
and ending April 30, 1994. Since the beginning of fiscal 1994, the
Company has paid $200,000 under this agreement ($100,000 of which was
for the fiscal month ending January 29, 1994 and was accrued in fiscal
1993).
In addition, in September 1993, an affiliate of Blackstone
Partners negotiated with Arkaid Incorporated, a real estate consultant
("Arkaid"), to receive 20% of the incentive fees payable to Arkaid by
Products in connection with the resolution of lease liabilities of
Builders Emporium. An affiliate of Blackstone Partners received
$461,375 in fees during 1994 pursuant to this arrangement.
During the first quarter of 1994, the Company incurred expenses of
$2.5 million for services performed by affiliates of Blackstone
Partners and WP Partners in connection with a comprehensive review of
the Company's liabilities associated with discontinued operations,
including surplus real estate, postretirement and workers
compensation liabilities. During the first quarter of 1994, the
Company incurred expenses of $3.25 million for services performed by
an affiliate of Blackstone Partners and $2.75 million for services
performed by an affiliate of WP Partners in connection the Company's
review of refinancing and strategic alternatives as well as certain
other advisory services.
On July 13, 1994, the Company completed an initial public offering of
15 million shares of Common Stock. In addition, the
20
<PAGE>
Company at that time sold to its principal stockholders Blackstone
Partners and WP Partners or their affiliates an additional 8.81 million
shares of Common Stock for $87 million. In a noncash transaction,
approximately 18.5 million shares of Common Stock were also issued to
such principal stockholders for indebtedness with an outstanding face
amount of $194.7 million. For additional information concerning the
beneficial ownership of shares of Common Stock by Blackstone Partners
and WP Partners or their affiliates, see "Voting Securities and
Principal Stockholders".
Wasserstein Perella Securities, Inc. ("WP Securities"), a wholly
owned subsidiary of WP Group, participated as a lead underwriter in the
Company's public offering of Common Stock in July 1994 and was paid
fees of approximately $1 million by the Company in connection
therewith.
For a description of the relationships of the Company's
directors with any of Blackstone Group, Blackstone Partners,
Blackstone Management, WP Partners, WP & Co. or WP Management, see
"Information as to Nominees and Other Directors" and "Certain
Relationships" above.
RELATIONSHIPS WITH INDEPENDENT ACCOUNTANTS
Arthur Andersen L.L.P. served as independent auditors of the
Company for the fiscal year ended January 28, 1995, and has served as
independent auditors of the Company since the Company's inception in
1988. The Board of Directors has selected Arthur Andersen L.L.P. to
serve as independent auditors of the Company for the fiscal year ending
January 27, 1996. A representative of Arthur Anderson L.L.P. is
expected to be present at the Meeting with the opportunity to make a
statement if he or she desires to do so and to respond to appropriate
questions from stockholders.
STOCKHOLDER PROPOSALS
Any stockholder who wishes to submit a proposal for action to be
included in the proxy materials for the Company's 1996 Annual Meeting
must submit such proposal so that it is received by the Secretary of
the Company not later than February 1, 1996. Proposals must be in
writing and sent via registered, certified or express mail.
Facsimile or other forms of electronic submissions will not be
accepted.
ANNUAL REPORT
The Company's Annual Report for the fiscal year ended January 28,
1995, is being sent to the stockholders of the Company. The Company
will furnish without charge to any stockholder who so requests in
writing a copy of the Company's Annual Report on Form 10-K for the
fiscal year ended January 28, 1995, including financial statements and
financial statement schedules. The Company will furnish a copy of any
of the exhibits referenced in the Annual Report on Form 10-K upon the
request in writing of a stockholder for a fee of not more than $.50
per page to cover the cost of reproduction and mailing. Requests may
be directed to: Collins & Aikman Corporation, 701 McCullough
Drive, P.O. Box 32665, Charlotte, NC 28232-2665, Attention:
Director-Investor Relations.
Neither the Annual Report nor any of the financial statements
contained therein are to be considered filed as part of this Proxy
Statement or deemed soliciting material.
OTHER MATTERS
It is not expected that any other matters will be brought before the
Meeting. If any matter not described in this Proxy Statement should
properly come before the Meeting, the persons named in the
accompanying proxy will vote the proxy in accordance with their best
judgment unless a stockholder, by striking out the appropriate
provision of the proxy, chooses to withhold authority to vote on such
matters.
By Order of the Board of Directors,
/s/ Elizabeth R. Philipp
ELIZABETH R. PHILIPP
Secretary
PLEASE MARK, SIGN AND DATE THE ENCLOSED PROXY CARD AND MAIL IT PROMPTLY.
NO POSTAGE STAMP IS NECESSARY IF MAILED IN THE UNITED STATES.
21
<PAGE>
____________________________________________________________________________
Annex A
Collins & Aikman Corporation
1994 Directors Stock Option Plan
I. Purposes of the Plan
The purposes of this 1994 Directors Stock Option Plan (the "Plan") are
to enable Collins & Aikman Corporation (the "Company") to attract,
retain and motivate the directors who are important to the success and
growth of the business of the Company and to create a long-term
mutuality of interest between the directors and the stockholders of
the Company by granting the directors options to purchase Common Stock
(as defined herein). This document shall supersede all other material
describing this Plan, including, but not limited to, prior drafts
hereof and any documents incorporating the terms and provisions of any
such prior drafts.
II. Definitions
In addition to the terms defined elsewhere herein, for purposes of this
Plan, the following terms will have the following meanings when
used herein with initial capital letters:
A. "Act" means the Securities Exchange Act of 1934, as amended,
and all rules and regulations promulgated thereunder.
B. "Board" means the Board of Directors of the Company.
C. "Code" means the Internal Revenue Code of 1986, as amended
(or any successor statute).
D. "Committee" means the Board or a duly appointed committee of
the Board to which the Board has delegated its power and functions hereunder.
E. "Common Stock" means the common stock of the Company, par value
$.01 per share, any Common Stock into which the Common Stock may be
converted and any Common Stock resulting from any reclassification
of the Common Stock.
F. "Company" means Collins & Aikman Corporation, a Delaware
corporation.
G. "Eligible Director" means a director of the Company who is not
an active employee of the Company or any subsidiary and who is not
an officer, director or employee of (i) any entity which, directly or
indirectly, beneficially owns or controls 5% or more of the combined
voting power of the then outstanding voting securities of the Company
(or any subsidiary) entitled to vote generally in the election of
directors or (ii) any entity controlling, controlled by or under
common control (within the meaning of Rule 405 of the Securities
Act) with any such entity.
H. "Fair Market Value" shall mean, for purposes of this Plan,
unless otherwise required by any applicable provision of the Code
or any regulations issued thereunder, as of any date,
A-1
<PAGE>
the last sales prices reported for the Common Stock on the applicable
date, (i) as reported by the principal national securities exchange in
the United States on which it is then traded, or (ii) if not traded on
any such national securities exchange, as quoted on an automated quotation
system sponsored by the National Association of Securities Dealers, or
if the sale of the Common Stock shall not have been reported or quoted
on such date, on the first day prior thereto on which the Common Stock
was reported or quoted.
I. "Option" means the right to purchase one Share at a
prescribed purchase price on the terms specified in the Plan.
J. "Participant" means an Eligible Director who is granted
Options under the Plan which Options have not expired.
K. "Person" means any individual or entity, and the heirs,
executors, administrators, legal representatives, successors and
assigns of such Person as the context may require.
L. "Related Person" means (a) any corporation that is defined as a
subsidiary corporation in Section 424(f) of the Code or (b) any
corporation that is defined as a parent corporation in Section 424(e)
of the Code. An entity shall be deemed a Related Person only for such
periods as the requisite ownership relationship is maintained.
M. "Securities Act" means the Securities Act of 1933, as
amended, and all rules and regulations promulgated thereunder.
N. "Share" means a share of Common Stock.
O. "Termination of Directorship" with respect to an individual
means that individual is no longer acting as a director of the Company.
III. Effective Date
The Plan shall become effective as of November 1, 1994 (the
"Effective Date"), subject to its approval by the majority of the Common
Stock (at the time of approval) within one year after the Plan is
adopted by the Board. Grants of Options under the Plan will be made
after the Effective Date of the Plan pursuant to Article VI(B) of this
Plan, provided that, if the Plan is not approved by the majority of the
Common Stock (at the time of approval), all Options which have been
granted pursuant to the terms of the Plan shall be null and void. No
Options may be exercised prior to the approval of the Plan by the
majority of the Common Stock (at the time of approval).
IV. Administration
A. Duties of the Committee. The Plan shall be administered by the
Committee. The Committee shall have full authority to interpret the
Plan and to decide any questions and settle all controversies and
disputes that may arise in connection with the Plan; to establish,
amend and rescind rules for carrying out the Plan; to administer the
Plan, subject to its provisions; to prescribe the form or forms of
instruments evidencing Options and any other instruments required
under the Plan and to change such forms from time to time; and to
make all other determinations and to take all such steps in
connection with the Plan and the Options as the Committee, in its
sole discretion, deems necessary or desirable. The Committee shall not
be bound to any standards of uniformity or similarity of action,
interpretation or conduct in the discharge of its duties
hereunder, regardless of the apparent similarity of
A-2
<PAGE>
the matters coming before it. Any determination, action or conclusion
of the Committee shall be final, conclusive and binding on all parties.
B. Advisors. The Committee may employ such legal counsel,
consultants and agents as it may deem desirable for the administration
of the Plan, and may rely upon any advice or opinion received from any
such counsel or consultant and any computation received from any such
consultant or agent. Expenses incurred by the Committee in the
engagement of such counsel, consultant or agent shall be paid by the
Company.
C. Indemnification. To the maximum extent permitted by
applicable law, no officer of the Company or member or former member
of the Committee or of the Board shall be liable for any action or
determination made in good faith with respect to the Plan or any Option
granted under it. To the maximum extent permitted by applicable law
and the Restated Certificate of Incorporation or By-Laws of the
Company, each officer and member or former member of the Committee or
of the Board shall be indemnified and held harmless by the Company
against any cost or expense (including reasonable fees of counsel
reasonably acceptable to the Company) or liability (including any sum
paid in settlement of a claim with the approval of the Company), and
advanced amounts necessary to pay the foregoing at the earliest time and
to the fullest extent permitted, arising out of any act or omission to
act in connection with the Plan, except to the extent arising out of
such officer's, member's or former member's own fraud or bad faith.
Such indemnification shall be in addition to any rights of
indemnification the officers, members or former members may have as
directors or officers under applicable law or under the Restated
Certificate of Incorporation or By-Laws of the Company.
D. Meetings of the Committee. The Committee shall adopt such rules
and regulations as it shall deem appropriate concerning the holding of
its meetings and the transaction of its business. All determinations
by the Committee shall be made by the affirmative vote of a majority of
its members. Any such determination may be made at a meeting duly
called and held at which a majority of the members of the Committee
are in attendance in person or through telephonic communication. Any
determination set forth in writing and signed by all the members of the
Committee shall be as fully effective as if it had been made by a
majority vote of the members at a meeting duly called and held.
E. Determinations. Each determination, interpretation or other
action made or taken pursuant to the provisions of this Plan by the
Committee shall be final, conclusive and binding for all purposes and
upon all persons, including, without limitation, the Participants,
the Company, directors, officers and other employees of the
Company, and the respective heirs, executors, administrators,
personal representatives and other successors in interest of each of
the foregoing.
F. Disinterested Directors. Notwithstanding the foregoing, the
Committee may not take any action which would cause any Eligible
Director to cease to be a "disinterested person" for purposes of Rule
16b-3 promulgated under the Act, as then in effect or any successor
provisions ("Rule 16b-3"), with regard to any stock option or other
equity plan of the Company.
V. Shares; Adjustment Upon Certain Events
A. Shares to be Delivered; Fractional Shares. Shares to be
issued under the Plan shall be made available, at the sole discretion
of the Board, either from authorized but unissued Shares or from
issued Shares reacquired by Company and held in treasury. No
fractional Shares will be issued or transferred upon the exercise
of any Option nor will any compensation be paid with regard to
fractional shares.
A-3
<PAGE>
B. Number of Shares. Subject to adjustment as provided in this
Article V, the maximum aggregate number of Shares that may be issued
under the Plan shall be 600,000. Where Options are for any reason
cancelled, or expire or terminate unexercised, the Shares covered by
such Options shall again be available for the grant of Options,
within the limits provided by the preceding sentence.
C. Adjustments; Recapitalization, etc. The existence of this Plan
and the Options granted hereunder shall not affect in any way the
right or power of the Board or the stockholders of the Company to make
or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business,
any merger or consolidation of the Company, any issue of bonds,
debentures, preferred or prior preference stocks ahead of or
affecting Common Stock, the dissolution or liquidation of the Company
or any sale or transfer of all or part of its assets or business, or
any other corporate act or proceeding, in which case the provisions of
this Article V(C) shall govern outstanding Options:
1. The Shares with respect to which Options may be granted are
Shares of Common Stock as presently constituted, but, if and
whenever the Company shall effect a subdivision, recapitalization
or consolidation of Shares or the payment of a stock dividend on
Shares without receipt of consideration, the aggregate number and
kind of shares of capital stock issuable under this Plan shall be
proportionately adjusted, and each holder of a then outstanding Option
shall have the right to purchase under such Option, in lieu of the
number of Shares as to which the Option was then exercisable
but on the same terms and conditions of exercise set forth in such
Option, the number and kind of shares of capital stock which he or she
would have owned after such sub-division, recapitalization,
consolidation or dividend if immediately prior thereto he had been
the holder of record of the number of Shares as to which such Option
was then exercisable.
2. If the Company merges or consolidates with one or more
corporations and the Company shall be the surviving corporation,
thereafter upon exercise of an Option theretofore granted, the
Participant shall be entitled to purchase under such Option in lieu of
the number of Shares as to which such Option shall then be
exercisable, but on the same terms and conditions of exercise set
forth in such Option, the number and kind of shares of capital stock or
other property to which the Participant would have been entitled
pursuant to the terms of the agreement of merger or consolidation if,
immediately prior to such merger or consolidation, the Participant
had been the holder of record of the number of Shares as to which such
Option was then exercisable.
3. If the Company shall not be the surviving corporation in any
merger or consolidation, or if the Company is to be dissolved or
liquidated, then, unless the surviving corporation assumes the Options
or substitutes new Options which are determined by the Board in
its sole discretion to be substantially similar in nature and
equivalent in terms and value for Options then outstanding, upon the
effective date of such merger, consolidation, liquidation or
dissolution, any unexercised Options shall expire without additional
compensation to the holder thereof; provided, that, the Committee
shall deliver notice to each Participant at least 20 days prior to the
date of consummation of such merger, consolidation, dissolution or
liquidation which would result in the expiration of the Options and
during the period from the date on which such notice of termination is
delivered to the consummation of the merger, consolidation, dissolution
or liquidation, each Participant shall have the right to exercise in
full effective as of such consummation all the Options that are then
outstanding (without regard to limitations on exercise otherwise
contained in the Options other than the requirements of Article III) but
contingent on occurrence of the merger, consolidation, dissolution
or liquidation, and, provided that, if the contemplated transaction does
not take place within a ninety (90) day period after giving such notice
for
A-4
<PAGE>
any reason whatsoever, the notice, accelerated vesting and exercise
shall be null and void and if and when appropriate new notice shall
be given as aforesaid. Notwithstanding the foregoing, the Options held
by persons subject to Section 16(b) of the Act that would not have vested
under the Plan except pursuant to Article VI(F) prior to the effective
date of such merger, consolidation, liquidation or dissolution shall
not expire on such date but shall expire thirty (30) days after they
would have otherwise vested under the Plan and shall after the effective
date of such merger, consolidation, liquidation or dissolution represent
only the right to receive the number and kind of shares of capital stock
or other property to which the Participant would have been entitled if
immediately prior to the effective date of such merger,
consolidation, liquidation or dissolution the Participant had been the
holder of record of the number of Shares as to which such
Option was then exercisable.
4. If as a result of any adjustment made pursuant to the
preceding paragraphs of this Article V(C), any Participant shall
become entitled upon exercise of an Option to receive any shares of
capital stock other than Common Stock, then the number and kind of
shares of capital stock so receivable thereafter shall be subject to
adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common
Stock set forth in this Article V(C).
5. Except as hereinbefore expressly provided, the issuance by the
Company of shares of stock of any class or securities convertible
into shares of stock of any class, for cash, property, labor or
services, upon direct sale, upon the exercise of rights or warrants to
subscribe therefor, or upon conversion of shares or other securities,
and in any case whether or not for fair value, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the number
of Shares subject to Options theretofore granted or the purchase price
per Share.
VI. Awards and Terms of Options
A. Grant. Without further action by the Board or the
stockholders of the Company, each Eligible Director on each Annual
Date of Grant (as hereinafter defined) shall be automatically
granted options to purchase 10,000 shares, subject to the terms of
the Plan, provided that no such Option shall be granted if on the
date of grant the Company has liquidated, dissolved or merged or
consolidated with another entity in such a manner that it is not the
surviving entity (unless the Plan has been assumed by such surviving
entity with regard to future grants).
B. Date of Grant. Annual Grants shall be made initially on the date
on which this Plan is approved by the Board (the "Initial Grant
Date") and on each anniversary of the Effective Date thereafter (the
Initial Grant Date and each anniversary of the Effective Date
thereafter being referred to as an "Annual Date of Grant"); provided
that if such date in any year is a date on which the New York Stock
Exchange is not open for trading, the grant shall be made on the first
day thereafter on which the New York Stock Exchange is open for
trading. Notwithstanding the foregoing, in the event no Fair Market
Value can be determined pursuant to the provisions hereof, no Annual
Grant shall be made for such fiscal year.
C. Option Agreement. Options shall be evidenced by Option
agreements in substantially the form annexed hereto as Exhibit A as
modified from time to time.
A-5
<PAGE>
D. Option Terms:
1. Exercise Price. The purchase price per share ("Purchase
Price") deliverable upon the exercise of an Option shall be 100%
of the Fair Market Value of such Share as of the date of the
grant of the Option, or the par value of the Share, whichever is
the greater.
2. Period of Exercisability. Except as otherwise provided
herein, each Option granted under this Plan shall be exercisable
on or after the later of (a) six (6) months and one day after
the date of grant or (b) approval of this Plan by the
stockholders in accordance with Article III hereof.
3. Procedure for Exercise. A Participant electing to exercise one
or more Options shall give written notice to the Secretary of
the Company of such election and of the number of Options he
or she has elected to exercise. Shares purchased pursuant to
the exercise of Options shall be paid for at the time of exercise
in cash or by delivery of unencumbered Shares owned by the
Participant for at least six months (or such longer period as
required by applicable accounting standards to avoid a charge to
earnings) or a combination thereof.
E. Expiration. Except as otherwise provided herein, if not
previously exercised each Option shall expire upon the tenth
anniversary of the date of the grant thereof.
F. Acceleration of Exercisability.
All Options granted and not previously exercisable shall become fully
exercisable immediately upon the later of a Change of Control (as
defined herein) or approval of the Plan by the stockholders in
accordance with Article III. Article (V)(C) shall also apply to the
extent, if any, it is applicable. For this purpose, a "Change of
Control" shall be deemed to have occurred upon:
(a) an acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or (14)(d)(1) of the
Act) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Act) of more than 80% of the combined
voting power of the then outstanding voting securities of
Company entitled to vote generally in the election of directors,
including, but not limited to, by merger, consolidation or
similar corporate transaction or by purchase; excluding,
however, the following: (x) any acquisition by the Company, a
Related Person, Wasserstein Perella Partners, L.P., Blackstone
Capital Partners L.P. or an affiliate of any of the
foregoing, or (y) any acquisition by an employee benefit plan
(or related trust) sponsored or maintained by the Company or a
Related Person; or
(b) the approval of the stockholders of the Company of (i) a
complete liquidation or dissolution of the Company or (ii) the
sale or other disposition of more than 80% of the gross assets
of the Company and Related Persons on a consolidated basis
(determined under generally accepted accounting principles
in accordance with prior practice); excluding, however, such a
sale or other disposition to a corporation with respect to which,
following such sale or other disposition, (x) more than 20% of
the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in
the election of directors will be then beneficially owned,
directly or indirectly, by the individuals and entities who
were the beneficial owners of the outstanding Shares
immediately prior to such sale or other disposition, (y) no
Person (other than the Company, Related Persons, and any
employee benefit plan (or related trust) of the Company or
Related Persons or such corporation and any Person
A-6
<PAGE>
beneficially owning, immediately prior to such sale or
other disposition, directly or indirectly, 20% or more of the
outstanding Shares) will beneficially own, directly or
indirectly, 20% or more of the combined voting power of the then
outstanding voting securities of such corporation entitled to
vote generally in the election of directors and (z) individuals
who were members of the incumbent board immediately prior to the
sale or other disposition will constitute at least a majority
of the members of the board of directors of such corporation.
VII. Effect of Termination of Directorship
A. Death, Disability or Otherwise Ceasing to be a Director.
Except as otherwise provided herein, upon Termination of
Directorship, on account of disability, death, resignation, failure to
stand for reelection or failure to be reelected or otherwise, all
outstanding Options then exercisable and not exercised by the
Participant prior to such Termination of Directorship shall remain
exercisable by the Participant or, in the case of death, by the
Participant's estate or by the person given authority to exercise such
Options by his or her will or by operation of law, until the expiration
of the Option in accordance with the terms of the Plan and grant.
B. Cancellation of Options. No Options that were not
exercisable during the period such person serves as a director
shall thereafter become exercisable upon a Termination of
Directorship for any reason or no reason whatsoever, and such
options shall terminate and become null and void upon a Termination of
Directorship.
VIII. Nontransferability of Options
Except as provided in the following sentence, no Option shall be
transferable by the Participant otherwise than by will or under
applicable laws of descent and distribution and during the lifetime of
the Participant may be exercised only by the Participant or his or
her guardian or legal representative. An Option shall also be
transferable under a domestic relations order that is a "qualified
domestic relations order", as defined in section 414(p) of the Code,
but may thereafter not be further transferred except as provided in
the prior sentence (with the alternate payee under such order being
substituted for "Participant"). In addition, except as provided
above, no Option shall be assigned, negotiated, pledged or hypothecated
in any way (whether by operation of law or otherwise), and no Option
shall be subject to execution, attachment or similar process. Upon any
attempt to transfer, assign, negotiate, pledge or hypothecate any
Option, or in the event of any levy upon any Option by reason of any
execution, attachment or similar process contrary to the provisions
hereof, such Option shall immediately terminate and become null and
void.
IX. Rights as a Stockholder
A Participant (or a permitted transferee of an Option) shall have no
rights as a stockholder with respect to any Shares covered by
such Participant's Option until such Participant (or permitted
transferee) shall have become the holder of record of such Shares, and
no adjustments shall be made for dividends in cash or other property or
distributions or other rights in respect to any such Shares, except as
otherwise specifically provided in this Plan.
A-7
<PAGE>
X. Termination, Amendment and Modification
The Plan shall terminate at the close of business on the seventh
anniversary of the Effective Date (the "Termination Date"), unless
terminated sooner as hereinafter provided, and no Option shall be
granted under the Plan on or after that date. The termination of the
Plan shall not terminate any outstanding Options that by their terms
continue beyond the Termination Date. The Committee at any time or from
time to time may amend this Plan to effect (i) amendments necessary or
desirable in order that this Plan and the Options shall conform to all
applicable laws and regulations, and (ii) any other amendments
deemed appropriate, provided that no such amendment may be made if
either the authority to make such amendment or the amendment would
cause the Eligible Directors to cease to be "disinterested persons"
with regard to this Plan or any other stock option or other equity
plan of the Company for purposes of Rule 16b-3 and further provided
that the provisions of the Plan relating to the amount, price and
timing of, and eligibility for, awards shall not be amended more than
once every six (6) months except to comport with changes in the Code
and the Employee Retirement Income Security Act of 1974, as amended,
or the rules thereunder. Notwithstanding the foregoing, the
Committee may not effect any amendment that would require the approval
of the stockholders of the Company under Rule 16b-3 unless such approval
is obtained. In no event, unless no longer required as a condition of
compliance with the requirements of Rule 16b-3, shall the Committee
without the approval of stockholders normally entitled to vote for
the election of directors of the Company:
1. increase the number of Shares available for grants under this Plan;
2. reduce the minimum exercise price at which any option may be
exercised;
3. change the requirements as to eligibility for participation under
this Plan;
4. change the number of Options to be granted or the date on which
such Options are to be granted; or
5. materially increase the benefits accruing to Participants
hereunder.
This Plan may be amended or terminated at any time by the
stockholders of the Company.
This Plan and any Options granted hereunder shall terminate and be void
if this Plan does not receive the approval of the stockholders of
the Company that may be required under Rule 16b-3, no later than the
next annual meeting of stockholders of the Company. Except as otherwise
required by law, no termination, amendment or modification of this
Plan may, without the consent of the Participant or the permitted
transferee of his Option, alter or impair the rights and obligations
arising under any then outstanding Option.
XI. Use of Proceeds
The proceeds of the sale of Shares subject to Options under the Plan
are to be added to the general funds of the Company and used for
its general corporate purposes as the Board shall determine.
A-8
<PAGE>
XII. General Provisions
A. Right to Terminate Directorship. This Plan shall not impose any
obligations on the Company to retain any Participant as a director
nor shall it impose any obligation on the part of any Participant to
remain as a director of the Company.
B. Trusts, etc. Nothing contained in the Plan and no action taken
pursuant to the Plan (including, without limitation, the grant of any
Option thereunder) shall create or be construed to create a trust of any
kind, or a fiduciary relationship, between the Company and any
Participant or the executor, administrator or other personal
representative or designated beneficiary of such Participant, or any
other persons. Any reserves that may be established by the Company in
connection with the Plan shall continue to be part of the general funds
of the Company, and no individual or entity other than the Company
shall have any interest in such funds until paid to a
Participant. If and to the extent that any Participant or such
Participant's executor, administrator or other personal representative,
as the case may be, acquires a right to receive any payment from the
Company pursuant to the Plan, such right shall be no greater than the
right of an unsecured general creditor of the Company.
C. Notices. Any notice to the Company required by or in
respect of this Plan will be addressed to the Company at 701 McCullough
Drive, Charlotte, North Carolina 28262, Attention: Vice President, Human
Resources, or such other place of business as shall become the
Company's principal executive offices from time to time, or sent to
the Company by facsimile to (704) 548-2081, Attention: Vice President,
Human Resources or to such other facsimile number as the Company
shall notify each Participant. Each Participant shall be
responsible for furnishing the Committee with the current and proper
address for the mailing to such Participant of notices and the
delivery to such Participant of agreements, Shares and payments.
Any such notice to the Participant will, if the Company has received
notice that the Participant is then deceased, be given to the
Participant's personal representative if such representative has
previously informed the Company of his or her status and address (and
has provided such reasonable substantiating information as the Company
may request) by written notice under this Section. Any notice required
by or in respect of this Plan will be deemed to have been duly given
when delivered in person or when dispatched by telegram or, in the case
of notice to the Company, by facsimile as described above, or one
business day after having been dispatched by a nationally recognized
overnight courier service or three business days after having been
mailed by United States registered or certified mail, return
receipt requested, postage prepaid. The Company assumes no
responsibility or obligation to deliver any item mailed to such address
that is returned as undeliverable to the addressee and any further
mailings will be suspended until the Participant furnishes the proper
address.
D. Severability of Provisions. If any provisions of the Plan shall
be held invalid or unenforceable, such invalidity or unenforceability
shall not affect any other provisions of the Plan, and the Plan
shall be construed and enforced as if such provisions had not been
included.
E. Payment to Minors, Etc. Any benefit payable to or for the
benefit of a minor, an incompetent person or other person incapable of
receipt thereof shall be deemed paid when paid to such person's
guardian or to the party providing or reasonably appearing to
provide for the care of such person, and such payment shall fully
discharge the Committee, the Company and their employees, agents and
representatives with respect thereto.
A-9
<PAGE>
F. Headings and Captions. The headings and captions herein are
provided for reference and convenience only. They shall not be
considered part of the Plan and shall not be employed in the
construction of the Plan.
G. Controlling Law. The Plan shall be construed and enforced
according to the laws of the State of Delaware.
H. Section 16(b) of the Act. All elections and transactions under
the Plan by persons subject to Section 16 of the Act involving shares of
Common Stock are intended to comply with all exemptive conditions
under Rule 16b-3. To the extent any provision of the Plan or action
by the Committee fails to so comply, it shall be deemed null and
void. The Committee may establish and adopt written administrative
guidelines, designed to facilitate compliance with Section 16(b) of the
Act, as it may deem necessary or proper for the administration and
operation of the Plan and the transaction of business thereunder.
XIII. Issuance of Stock Certificates;
Legends; Payment of Expenses
A. Stock Certificates. Upon any exercise of an Option and
payment of the exercise price as provided in such Option, a
certificate or certificates for the Shares as to which such Option has
been exercised shall be issued by the Company in the name of the person
or persons exercising such Option and shall be delivered to or upon
the order of such person or persons, subject, however, in the case of
Options exercised pursuant to Section V(C)3 hereof, to the merger,
consolidation, dissolution or liquidation triggering the rights under
that Section.
B. Legends. Certificates for Shares issued upon exercise of an
Option shall bear such legend or legends as the Committee, in its
sole discretion, determines to be necessary or appropriate to prevent
a violation of, or to perfect an exemption from, the registration
requirements of the Securities Act or to implement the provisions of
any agreements between the Company and the Participant with respect to
such Shares.
C. Payment of Expenses. The Company shall pay all issue or
transfer taxes with respect to the issuance or transfer of Shares, as
well as all fees and expenses necessarily incurred by the Company in
connection with such issuance or transfer and with the administration of
the Plan.
XIV. Listing of Shares and Related Matters
If at any time the Board or the Committee shall determine in its sole
discretion that the listing, registration or qualification of the Shares
covered by the Plan upon any national securities exchange or under any
state or federal law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in
connection with, the grant of Options or the award or sale of Shares
under the Plan, no Option grant shall be effective and no Shares will
be delivered, as the case may be, unless and until such listing,
registration, qualification, consent or approval shall have been
effected or obtained, or otherwise provided for, free of any conditions
not acceptable to the Board.
A-10
<PAGE>
XV. Withholding Taxes
The Company shall have the right to require, prior to the issuance or
delivery of any shares of Common Stock, payment by the Participant of
any Federal, state or local taxes required by law to be withheld.
A-11
<PAGE>
Exhibit A
COLLINS & AIKMAN CORPORATION
OPTION AGREEMENT
PURSUANT TO THE
1994 DIRECTORS STOCK OPTION PLAN
[Eligible Director]
Dear:
Preliminary Statement
As a director of Collins & Aikman Corporation (the "Company") on the
Annual Date of Grant and pursuant to the terms of the Collins &
Aikman Corporation 1994 Directors Stock Option Plan, annexed hereto as
Exhibit 1 (the "Plan"), you, as an Eligible Director (as defined in
the Plan), have been automatically granted a nonqualified stock
option (the "Option") to purchase the number of shares of the
Company's common stock, par value $.01 per share (the "Common Stock"),
set forth below.
The terms of the grant are as follows:
1. Tax Matters. No part of the Option granted hereby is
intended to qualify as an "incentive stock option" under Section 422
of the Internal Revenue Code of 1986, as amended (the "Code").
2. Grant of Option. Subject in all respects to the Plan and the
terms and conditions set forth herein and therein including,
without limitation, the provisions requiring shareholder approval,
you are hereby granted an Option to purchase from the Company up to
10,000 Shares (as defined in the Plan), at a price per Share of
$_________ (the "Option Price").
3. Vesting. The Option may be exercised by you, in whole or in part,
at any time or from time to time on or after the later of (a) six (6)
months and one (1) day after the date of grant or (b) approval of the
Plan by the stockholders of the Company and prior to the expiration
of the Option as provided herein and in the Plan. Upon the occurrence
of a Change of Control (as defined in the Plan), the Option shall
immediately become exercisable with respect to all Shares subject
thereto, regardless of whether the Option has vested with respect to
such Shares upon the later of such Change of Control and approval of
the Plan by the stockholders of the Company.
4. Termination. Unless terminated as provided below or
otherwise pursuant to the Plan, the Option shall expire on the
tenth anniversary of this grant.
5. Restriction on Transfer of Option. Except as provided in the
Plan with regard to a "qualified domestic relations order", as defined
in Section 414(p) of the Internal Revenue Code, the Option granted
hereby is not transferable otherwise than by will or under the
applicable laws of descent and distribution and during your lifetime
may be exercised only by you or your guardian or legal representative.
In addition, the Option shall not be assigned, negotiated, pledged
or hypothecated in any way (whether by operation of law or otherwise),
and the Option shall not be subject to execution, attachment or
similar process. Upon any attempt to transfer, assign, negotiate,
pledge or hypothecate
A-12
<PAGE>
the Option, or in the event of any levy upon the Option by reason of any
execution, attachment or similar process contrary to the provisions hereof,
the Option shall immediately become null and void.
6. Rights as a Shareholder. You shall have no rights as a
shareholder with respect to any Shares covered by the Option until you
shall have become the holder of record of the Shares, and no
adjustments shall be made for dividends in cash or other property,
distributions or other rights in respect of any such Shares, except as
otherwise specifically provided for in the Plan.
7. Provisions of Plan Control. This grant is subject to all the
terms, conditions and provisions of the Plan and to such
rules, regulations and interpretations relating to the Plan as may be
adopted by the Committee and as may be in effect from time to time.
Any capitalized term used but not defined herein shall have the
meaning ascribed to such term in the Plan. The annexed copy of the
Plan is incorporated herein by reference. If and to the extent that
this grant conflicts or is inconsistent with the terms, conditions and
provisions of the Plan, the Plan shall control, and this grant shall be
deemed to be modified accordingly.
8. Notices. Any notice or communication given hereunder shall be in
writing and shall be deemed to have been duly given when delivered in
person or, in the case of notice to the Company, by facsimile to the
facsimile number set forth below, or when dispatched by Telegram, or
one business day after having been dispatched by a nationally
recognized courier service or three business days after having been
mailed by United States registered or certified mail, return receipt
requested, postage prepaid, to the appropriate party at the address
(or, in the case of notice to the Company, facsimile number) set
forth below (or such other address as the party shall from time to time
specify in accordance with Article XII(D) of the Plan.):
If to the Company, to:
Collins & Aikman Corporation
701 McCullough Drive
Charlotte, North Carolina 28262
Attention: Vice President, Human Resources
Facsimile number: (704) 548-2081
If to you, to:
the address indicated on the signature page at the end of
this grant.
Sincerely,
COLLINS & AIKMAN CORPORATION
By:__________________________
Authorized Officer
Accepted:
[PARTICIPANT]
Address:
A-13
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APPENDIX
<PAGE>
COLLINS & AIKMAN CORPORATION
P R O X Y
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 29, 1995
AND ANY ADJOURNMENT OR POSTPONEMENT THEREOF
The undersigned hereby appoints Thomas E. Hannah, David A. Stockman, and
Randall J. Weisenburger (the "Agents") as proxies (each with the power to act
alone and to appoint a substitute) and hereby authorizes each of them to
represent and to vote, as designated hereon, all the shares of Common Stock, par
value $0.01 per share, of Collins & Aikman Corporation (the "Company"), held of
record by the undersigned at the close of business on May 26, 1995, at the
Annual Meeting of Stockholders of the Company to be held on June 29, 1995, at
11:00 a.m., Eastern Daylight Savings Time, and at any adjournment or
postponement thereof, on the proposals referred to below and on the reverse
side.
THIS PROXY, WHEN EXECUTED, WILL BE VOTED IN ACCORDANCE WITH THE
SPECIFICATIONS HEREON. IN THE ABSENCE OF SUCH SPECIFICATIONS, THIS PROXY WILL BE
VOTED FOR PROPOSAL (I) AND FOR PROPOSAL (II).
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL (I) AND FOR PROPOSAL
(II).
THE UNDERSIGNED HEREBY REVOKES ANY PROXIES HERETOFORE GIVEN AND DIRECTS THE
AGENTS TO VOTE AS FOLLOWS:
PROPOSAL (I) Election of the following Nominees as Directors: Thomas E.
Hannah, Stephen A. Schwarzman and Bruce Wasserstein.
<TABLE>
<S> <C> <C>
[ ] FOR all Nominees (except as [ ] WITHHOLD AUTHORITY (for all nominees) [ ] If you wish to withhold authority to
indicated) vote for any nominee(s), write his
(their) name(s), on the lines below.
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Continued, and to be signed and dated, on reverse side.
<PAGE>
PROPOSAL (II) Approval and Ratification of the 1994 Directors Stock Option
Plan.
[ ] FOR Proposal (II) [ ] AGAINST Proposal (II) [ ] ABSTAIN
In their discretion, the Agents are authorized to vote on any other matters
as may properly come before the meeting or any adjournment or postponement
thereof.
The undersigned hereby ratifies
and confirms all that these Agents
may do by virtue hereof and hereby
acknowledges receipt of the Notice
of Annual Meeting of Stockholders
and the Proxy Statement.
Dated , 1995
Signature(s)*
*Please sign your name(s) exactly
as it (they) appear(s) opposite.
When shares are held by joint
owners, all should sign. When
signing as attorney, executor,
administrator, trustee or
guardian, please give full title
as such. If a corporation, please
sign in full corporate name by
president or other authorized
officer and indicate title. If a
partnership, please sign in
partnership name by authorized
person and indicate title.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE. VOTES SHOULD BE INDICATED
(X) IN BLACK OR BLUE INK.
