SCHEDULE 14A
(Rule 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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 Rule 14a-11(c) or Rule 14a-12
GALEY & LORD, INC.
(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) No fee required
( ) 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: N/A
(2) Aggregate number of securities to which transaction applies: N/A
(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): N/A
(4) Proposed maximum aggregate value of transaction: N/A
(5) Total fee paid: $0
( ) Fee paid previously with preliminary materials: N/A
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
GALEY & LORD, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD FEBRUARY 10, 1998
TO THE STOCKHOLDERS OF
GALEY & LORD, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of
Stockholders (the "Meeting") of Galey & Lord, Inc., a Delaware
corporation (the "Company"), will be held at Club 101, 101 Park
Avenue, New York, New York 10178, on Tuesday, February 10, 1998 at
10:30 A.M., Local Time, to consider and act upon the following:
1. To elect eight directors of the Company to serve as
the Board of Directors until the next annual meeting
of stockholders and until their successors have been
duly elected and qualified;
2. To ratify the selection of Ernst & Young LLP as
independent auditors of the Company for the 1998
fiscal year; and
3. To consider and act upon such other matters as may
properly come before the Meeting or any adjournment
thereof.
Only stockholders of record of the Company's Common Stock at
the close of business on December 22, 1997 shall be entitled to
receive notice of, and to vote at, the Meeting, and at any
adjournment or adjournments thereof. A list of the stockholders of
the Company as of the close of business on December 22, 1997 will
be available for inspection during business hours for ten days
prior to the Meeting at the Company's principal executive offices
located at 980 Avenue of the Americas, New York, New York 10018. A
Proxy and a Proxy Statement for the Meeting are enclosed herewith.
All stockholders are cordially invited to attend the Meeting.
Whether or not you plan to attend the Meeting, please complete,
date and sign the enclosed Proxy, which is solicited by the Board
of Directors of the Company, and mail it promptly in the enclosed
envelope to make sure that your shares are represented at the
Meeting. In the event you decide to attend the Meeting in person,
you may, if you desire, revoke your Proxy and vote your shares in
person.
By Order of the Board of
Directors
/s/ Michael R. Harmon
MICHAEL R. HARMON
SECRETARY
Dated: January 9, 1998
IMPORTANT
THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE
OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A QUORUM. A
SELF-ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO
POSTAGE IS REQUIRED IF MAILED WITHIN THE UNITED STATES.
<PAGE>
GALEY & LORD, INC.
980 Avenue of the Americas
New York, New York 10018
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 10, 1998
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Galey & Lord, Inc., a Delaware corporation
(the "Company"), to be voted at the Annual Meeting of Stockholders (the
"Meeting") of the Company which will be held at Club 101, 101 Park Avenue, New
York, New York 10178, on Tuesday, February 10, 1998 at 10:30 A.M., Local Time,
and any adjournment or adjournments thereof for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders and in this Proxy
Statement.
The principal executive offices of the Company are located at 980 Avenue of
the Americas, New York, New York 10018. The approximate date on which this Proxy
Statement and accompanying Proxy will first be sent or given to stockholders is
January 9, 1998.
A Proxy, in the accompanying form, which is properly executed, duly
returned to the Company and not revoked, will be voted in accordance with the
instructions contained therein and, in the absence of specific instructions,
will be voted (i) FOR the election as directors of persons who have been
nominated by the Board of Directors, (ii) FOR the ratification of the selection
of Ernst & Young LLP as independent auditors to audit and report upon the
consolidated financial statements of the Company for the 1998 fiscal year, and
(iii) in accordance with the judgment of the person or persons voting the
proxies on any other matter that may be properly brought before the Meeting.
Each such Proxy granted may be revoked at any time thereafter by writing to the
Secretary of the Company prior to the Meeting, or by execution and delivery of a
subsequent Proxy or by attendance and voting in person at the Meeting, except as
to any matter or matters upon which, prior to such revocation, a vote shall have
been cast pursuant to the authority conferred by such Proxy.
VOTING SECURITIES
Stockholders of record as of the close of business on December 22, 1997
(the "Record Date") will be entitled to notice of, and to vote at, the Meeting
or any adjournments thereof. On the Record Date there were outstanding
11,664,490 shares of the Company's Common Stock, $.01 par value (the "Common
Stock"), which figure does not include an additional 389,204 treasury shares
held by the Company. There was no other class of voting securities outstanding
at the Record Date. Each holder of Common Stock is entitled to one vote for each
share held by such holder. The presence, in person or by proxy, of the holders
of a majority of the outstanding shares of Common Stock is necessary to
constitute a quorum at the Meeting.
<PAGE>
PROPOSAL 1 -- ELECTION OF DIRECTORS
At the Meeting, eight directors are to be elected to serve until the next
annual meeting of stockholders and until their successors shall be duly elected
and shall qualify. Unless otherwise specified, all proxies received will be
voted in favor of the election of the eight nominees of the Board of Directors
named below as directors of the Company. All of the eight nominees are presently
directors of the Company. The term of the current directors expires at the
Meeting. Should any of the nominees not remain a candidate for election at the
date of the Meeting (which contingency is not now contemplated or foreseen by
the Board of Directors), proxies solicited thereunder will be voted in favor of
those nominees who do remain candidates and may be voted for substitute nominees
selected by the Board of Directors.
Assuming a quorum is present, a vote of a majority of the votes cast at the
Meeting, in person or by proxy, is required to elect each of the nominees as a
director. Abstentions and broker non-votes are not counted as votes cast.
The following table sets forth the names of the nominees, their ages, and
their current positions with the Company:
<TABLE>
<CAPTION>
NAME AGE TITLE
- ------------------- --- -----------------------
<S> <C> <C>
Arthur C. Wiener 60 Chairman of the Board,
President and Chief
Executive Officer
Lee Abraham 70 Director
Paul G. Gillease 65 Director
William deR. Holt 69 Director
Howard S. Jacobs 54 Director
William M.R. Mapel 66 Director
Stephen C. Sherrill 44 Director
David F. Thomas 48 Director
</TABLE>
Mr. Wiener has been Chairman of the Board of the Company since February
1992 and President and Chief Executive Officer of the Company since February
1988. He was Group Vice President of Burlington Industries, Inc. ("Burlington")
and President of Burlington's Blended Division, the Company's predecessor, from
October 1984 to February 1988. Mr. Wiener was President of the Apparel Fabrics
Marketing Division of Dan River Inc., a textile manufacturer, from 1975 to
October 1984. He was employed by the Menswear Division of Burlington in various
capacities from 1966 to October 1975, including as President from 1973 to
October 1975.
Mr. Abraham has been a director of the Company since February 1993. Mr.
Abraham served as Chairman and Chief Executive Officer of Associated
Merchandising Corporation, a retail merchandising and sourcing company, from
1977 until his retirement in January 1993. Mr. Abraham is a director of Liz
Claiborne, Inc., a sportswear apparel company; Salomon Smith Barney Income &
Equity Funds, a registered investment company; R.G. Barry Corporation, a
manufacturer of slippers; and Signet Group, plc, an owner and operator of retail
jewelry stores in the United States and the United Kingdom.
Mr. Gillease has been a director of the Company since November 1993. He has
been a consultant for Guilford Mills, Inc., a manufacturer of knitted textiles,
since November 1993. Mr. Gillease was employed by E.I. Du Pont de Nemours &
Company Incorporated in various executive capacities from 1961 to his retirement
in October 1993, including most recently as Vice President and General Manager
responsible for textile fiber operations from October 1990 to October 1993. Mr.
Gillease is a director of Pillowtex, Inc., a home furnishings manufacturer, and
Guilford Mills, Inc.
Mr. Holt has been a director of the Company since April 1988. He was
employed for 37 years by Burlington in various capacities, including most
recently as a Group Vice President until his retirement in March 1988.
Mr. Jacobs has been a director of the Company since February 1989. He has
been a member of the law firm of Rosenman & Colin LLP, New York, New York,
counsel to the Company, since March 1994. For more than five years prior to
March 1994, Mr. Jacobs was a member of two other law firms located in New York
City, each of which was former counsel to the Company.
Mr. Mapel has been a director of the Company since February 1989. Mr. Mapel
was employed by Citibank, N.A. in various executive capacities from 1969 to his
retirement in October 1988, including most recently as a Senior
2
<PAGE>
Vice President and Chairman of the Policy Committee of the North American
Finance Group from 1986 to September 1988. He has been the Chairman of the Board
of Mercantile & General Reinsurance Company of America, a reinsurance company,
and a director of Mercantile & General Life Reassurance Company of America, a
reinsurance company, since 1982. Mr. Mapel is a director of NSC Corporation, an
environmental service company; Brundage, Story & Rose Investment Trust, a
registered investment company; Churchill Capital Partners, a registered
investment company; and USLIFE Income Fund, Inc., a closed-end mutual fund.
Mr. Sherrill has been a director of the Company since May 1993. Mr.
Sherrill was formerly a director of the Company from February 1988 to February
1992. Mr. Sherrill has been a principal of Bruckman, Rosser, Sherrill & Co.,
Inc., a private equity investment firm, since February 1995. For more than five
years prior to February 1995, Mr. Sherrill was a Managing Director or Vice
President of Citicorp Venture Capital, Ltd. ("CVC"), a venture capital and
leveraged buyout company which is a subsidiary of Citibank N.A. Mr. Sherrill is
a director of Jitney Jungle Stores of America Inc., a regional chain of grocery
stores; Windy Hill Pet Food Company, Inc., a manufacturer of pet food products;
and B&G Foods Inc., a manufacturer, marketer and distributer of food products.
Mr. Thomas has been a director of the Company since March 1996. Mr. Thomas
has been a Managing Director of CVC for more than five years and has been the
President of 399 Venture Partners, Inc., a venture capital and leveraged buyout
company which is a subsidiary of Citibank N.A. and an affiliate of CVC, since
December 1994. Mr. Thomas is a director of Furnishings International Inc., a
manufacturer of residential furniture and decorative home furnishings fabrics.
There were six meetings of the Board of Directors of the Company during the
last fiscal year and action was taken by the directors by unanimous written
consent in lieu of a meeting on one occasion during the last fiscal year. All
directors attended 75% or more of the aggregate of the total number of meetings
of the Board and the total number of meetings of all committees of the Board on
which he served, except for Mr. Sherrill. The Board of Directors has designated
from among its members an Audit Committee, which consists of Messrs. Jacobs,
Mapel and Thomas. The Audit Committee, which reviews the Company's financial and
accounting practices and controls, held two meetings during the 1997 fiscal
year. The Company has a Compensation Committee of the Board of Directors, which
reviews the compensation of the Company's executive officers. The Compensation
Committee consists of Messrs. Abraham, Gillease and Holt. The Compensation
Committee held five meetings during the 1997 fiscal year. The Company does not
have a standing nominating committee. There are no family relationships between
any of the directors or executive officers of the Company.
In May 1992, the Company, CVC and Mr. Wiener entered into an agreement,
under which, if requested by CVC, the Company will use its best efforts to cause
a designee of CVC to be nominated as a director of the Company. Mr. Wiener has
agreed to vote all shares owned by him in favor of CVC's designee. Such
agreement will terminate on the earlier of its tenth anniversary or the date on
which CVC beneficially owns fewer than 20% of the outstanding shares of Common
Stock and nonvoting common stock of the Company. Pursuant to the agreement, CVC
also has the right to appoint an observer who will be permitted to attend all
meetings of the Board of Directors and its committees. Mr. Thomas is serving as
the designee of CVC under such agreement and Mr. Wiener will vote all shares of
Common Stock owned by him for the election of Mr. Thomas as a director.
EXECUTIVE OFFICERS
Set forth below is certain information regarding the executive officers of
the Company:
<TABLE>
<CAPTION>
NAME AGE CURRENT POSITION
- ------------------ --- ------------------------------------------------------------------------------------
<S> <C> <C>
Arthur C. Wiener 60 Chairman of the Board, President and Chief Executive Officer
Robert McCormack 48 Executive Vice President and President -- Woven Division, Apparel Marketing Group
Charles A. Blalock 50 Executive Vice President of Manufacturing
Michael R. Harmon 50 Executive Vice President, Chief Financial Officer, Treasurer and Secretary
</TABLE>
Officers serve at the discretion of the Board of Directors.
Information regarding Mr. Wiener is included herein in the section entitled
"PROPOSAL 1 -- ELECTION OF DIRECTORS."
3
<PAGE>
Mr. McCormack has been Executive Vice President of the Company since May
1992 and President of the Apparel Marketing Group of the Company's Woven
Division since April 1994. Mr. McCormack was Executive Vice President of the
Apparel Marketing Group of the Company's Woven Division from February 1988 to
April 1994. He was employed by Burlington as a merchandise manager from April
1986 to February 1988 and as a sales manager for finished goods from January
1985 to April 1986.
Mr. Blalock has been Executive Vice President of Manufacturing of the
Company since March 1990. He was Plant Manager of the Company's dyeing and
finishing plant located in Society Hill, South Carolina from February 1988 to
March 1990. Mr. Blalock was employed by Burlington in various line and staff
positions from September 1972 to February 1988, including most recently as Plant
Manager of the dyeing and finishing plant located in Society Hill from February
1987 to February 1988.
Mr. Harmon has been Executive Vice President and Chief Financial Officer of
the Company since March 1991 and Secretary and Treasurer of the Company since
February 1988. He was Vice President of Finance of the Company from February
1988 to March 1991. Mr. Harmon was employed by Burlington in various accounting
and financial capacities from May 1970 to February 1988, most recently as
Administrative Vice President and Controller from November 1987 to February
1988.
SECURITY OWNERSHIP
The following table sets forth certain information as of December 22, 1997
regarding the ownership of Common Stock of the Company by (i) each person who is
known to the management of the Company to have been the beneficial owner of more
than 5% of the outstanding shares of the Company's Common Stock, (ii) each
director and nominee for director, (iii) each executive officer named in the
Summary Compensation Table contained herein, and (iv) all directors and
executive officers of the Company as a group.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF POSITION WITH AMOUNT AND NATURE OF % OF
BENEFICIAL OWNER THE COMPANY BENEFICIAL OWNERSHIP CLASS
---------------------- ------------------------------- -------------------- -----
<S> <C> <C> <C>
Citicorp Venture Capital, Ltd. None 4,629,500(1) 39.7 %
399 Park Avenue
New York, New York 10043
FMR Corp. None 1,284,100(2) 11.0 %
82 Devonshire Street
Boston, Massachusetts 02109
Dimensional Fund Advisors, Inc. None 647,000(3) 5.5 %
1099 Ocean Avenue, 11th Floor
Santa Monica, California 90401
Arthur C. Wiener Chairman of the Board, 976,700(4)(5) 8.1 %
980 Avenue of the Americas President and Chief
New York, New York 10018 Executive Officer
Lee Abraham Director 9,900(5)(6) *
106 Barnes Road
Stamford, Connecticut 06902
Paul G. Gillease Director 10,749(5)(6)(7) *
15 McMullen Farm Lane
West Chester, Pennsylvania 19382
William deR. Holt Director 20,400(5)(6) *
206 Meadowbrook Terrace
Greensboro, North Carolina 27408
Howard S. Jacobs Director 22,400(5)(6) *
575 Madison Avenue
New York, New York 10022
William M. R. Mapel Director 22,930(5)(6) *
18 Stephanie Lane
Darien, Connecticut 06820
Stephen C. Sherrill Director 174,504(5)(6) 1.5 %
126 East 56th Street
New York, New York 10022
David F. Thomas Director 52,208(5) *
399 Park Avenue
New York, New York 10043
Charles A. Blalock Executive Vice President 68,925(8) *
7736 McCloud Road, Suite 300 of Manufacturing
Greensboro, North Carolina 27409
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
NAME AND ADDRESS OF POSITION WITH AMOUNT AND NATURE OF % OF
BENEFICIAL OWNER THE COMPANY BENEFICIAL OWNERSHIP CLASS
---------------------- ------------------------------- -------------------- -----
<S> <C> <C> <C>
Michael R. Harmon Executive Vice President, 112,430(9) 1.0 %
7736 McCloud Road, Suite 300 Chief Financial Officer,
Greensboro, North Carolina 27409 Treasurer and Secretary
Robert McCormack Executive Vice President 108,600(10) *
980 Avenue of the Americas and President -- Woven
New York, New York 10018 Division, Apparel
Marketing Group
All directors and executive officers 1,579,746(5) 12.9 %
as a group (11 persons)
</TABLE>
- ---------------
* Less than one percent (1%).
(1) Based upon information contained in a Schedule 13G filed with the Securities
and Exchange Commission (the "SEC") on February 18, 1997 (the "Schedule
13G") by Citicorp. CVC is a wholly-owned subsidiary of Citibank, N.A.;
Citibank, N.A. is a wholly-owned subsidiary of Citicorp. The Schedule 13G
indicates that neither Citicorp nor Citibank, N.A. have any dispositive
power or voting power with respect to any of the shares except through CVC.
Excludes shares of Common Stock owned by employees of CVC, as to which CVC
disclaims beneficial ownership.
(2) Based upon information contained in a Schedule 13G filed by FMR Corp.
("FMR"), a holding company, with the SEC on February 11, 1997, as amended on
September 9, 1997 (the "Schedule 13G"). Fidelity Management & Research
Company ("Fidelity"), a wholly-owned subsidiary of FMR and an investment
adviser registered under the Investment Advisors Act of 1940 is the
beneficial owner of these shares as a result of acting as investment adviser
to various investment companies including Fidelity Low-Priced Stock Fund, an
investment company registered under the Investment Company Act of 1940,
which holds 884,000 of the shares. Members of the Edward C. Johnson, 3d
family and trusts for their benefit own approximately 40% of the voting
power of FMR. Through such ownership and the execution of a certain
shareholders' voting agreement, members of the Johnson family, including
Abigail Johnson, may be deemed to form a controlling group with respect to
FMR. Edward C. Johnson, 3d, Chairman of FMR, and FMR through its control of
Fidelity, each has sole power to dispose of the 1,284,100 shares. Neither
FMR nor Edward C. Johnson, 3d has sole power to vote or direct the vote of
any of the shares owned directly by the Fidelity Funds, which power resides
with the Funds' Boards of Trustees.
(3) Based upon information contained in a Schedule 13G filed with the SEC on
February 12, 1997 (the "Schedule 13G") by Dimensional Fund Advisors Inc.
("Dimensional"). The Schedule 13G indicates that Dimensional has sole
dispositive power with respect to all of the shares, sole voting authority
with respect to 441,800 of the shares, and no voting authority with respect
to 205,200 of the shares.
(4) Includes 8,000 shares held by the Wiener Foundation, a not-for-profit
corporation controlled by Mr. Wiener and his immediate family members.
(5) Includes shares subject to currently exercisable stock options as follows:
Mr. Wiener -- 378,700; Mr. Abraham -- 6,000; Mr. Gillease -- 6,000; Mr.
Holt -- 18,000; Mr. Jacobs -- 20,000; Mr. Mapel -- 8,000; Mr.
Sherrill -- 11,000; Mr. Thomas -- 9,000; and all directors and executive
officers of the Company as a group -- 608,700.
(6) Includes shares issued under and subject to the Company's 1996 Restricted
Stock Plan (the "Restricted Stock Plan") as follows: Mr. Abraham -- 2,400;
Mr. Gillease -- 3,392; Mr. Holt -- 2,400; Mr. Jacobs -- 2,400; Mr.
Mapel -- 2,400; and Mr. Sherrill -- 3,392.
(7) Includes 500 shares held by Mr. Gillease's wife.
(8) Includes (i) 12,025 shares held by Mr. Blalock's wife, (ii) 100 shares held
by Mr. Blalock's daughter, and (iii) 56,800 shares subject to currently
exercisable stock options.
(9) Includes (i) 21,919 shares held by Mr. Harmon's wife, (ii) 17,000 shares
held in a self-directed individual retirement account, (iii) 500 shares held
in trust for the benefit of Mr. Harmon's daughter, with Mr. Blalock as
trustee, and (iv) 59,600 shares subject to currently exercisable stock
options.
5
<PAGE>
(10) Includes 35,600 shares subject to currently exercisable stock options.
Excludes 5,866 shares subject to currently exercisable stock options held
by Mr. McCormack's wife, as to which Mr. McCormack disclaims beneficial
ownership.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's executive officers, directors and persons who beneficially own
greater than 10% of a registered class of the Company's equity securities to
file certain reports ("Section 16 Reports") with the Securities and Exchange
Commission with respect to ownership and changes in ownership of the Common
Stock and other equity securities of the Company. Based solely on the Company's
review of the Section 16 Reports furnished to the Company and written
representations from certain reporting persons, all Section 16(a) requirements
applicable to its officers, directors and greater than 10% beneficial owners
were complied with, except that (i) Mr. Gillease failed to file a Form 4 for the
month of January 1996 to report the open market purchase of 357 shares during
such month, but such transaction was reported on a Form 5 for fiscal 1997, and
(ii) Mr. Blalock did not timely file a Form 4 in March 1997 to report his open
market sale of 10,000 shares during February 1997 and the open market sale of
2,000 shares by his wife during February 1997.
EXECUTIVE COMPENSATION
The following table summarizes compensation paid by the Company during
fiscal 1995, 1996 and 1997 to the Company's Chairman of the Board, President and
Chief Executive Officer and its other executive officers.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
AWARDS PAYOUTS
ANNUAL COMPENSATION RESTRICTED SECURITIES
OTHER ANNUAL STOCK UNDERLYING LTIP
FISCAL COMPENSATION AWARD(S) OPTIONS/ PAYOUTS
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($)(1) ($)(2) ($) SARS(#) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
Arthur C. Wiener 1997 $ 550,000 $ 377,000 $113,100 -- -- --
Chairman of the Board, 1996 500,000 233,789 70,137 -- 250,000(4) --
President and Chief 1995 500,000 -- -- -- 15,000(5) --
Executive Officer
Robert McCormack 1997 $ 245,004 $ 90,060 $ 27,018 -- -- --
Executive Vice President 1996 232,502 63,480 19,044 -- 75,000(4) --
and President -- Woven 1995 215,000 -- -- -- 8,500(5) --
Division, Apparel
Marketing Group
Charles A. Blalock 1997 $ 193,340 $ 90,060 $ 27,018 -- -- --
Executive Vice President 1996 181,671 63,480 19,044 -- 75,000(4) --
of Manufacturing 1995 161,667 -- -- -- 7,000(5) --
Michael R. Harmon 1997 $ 193,340 $ 90,060 $ 27,018 -- -- --
Executive Vice President, 1996 181,671 63,480 19,044 -- 75,000(4)
Chief Financial Officer, 1995 158,333 -- -- -- 7,000(5)
Treasurer and Secretary
<CAPTION>
ALL OTHER
COMPENSATION
NAME AND PRINCIPAL POSITION ($)(3)
<S> <C>
- ---------------------------
Arthur C. Wiener $3,654
Chairman of the Board, 2,977
President and Chief 624
Executive Officer
Robert McCormack $3,414
Executive Vice President 3,529
and President -- Woven 337
Division, Apparel
Marketing Group
Charles A. Blalock $2,208
Executive Vice President 2,325
of Manufacturing 253
Michael R. Harmon $3,333
Executive Vice President, 3,450
Chief Financial Officer, 248
Treasurer and Secretary
</TABLE>
- ---------------
(1) Reflects cash bonuses accrued under the Company's Incentive Bonus Plan.
(2) Reflects deferred compensation incentive awards granted for fiscal 1997 and
1996 under the Company's Deferred Compensation Program, a non-qualified,
unfunded plan established in fiscal 1994 by the Company under which certain
key executives are awarded deferred compensation. The plan participants will
only be vested in the current year award upon the completion of five years
of service after the date of the award, upon
6
<PAGE>
normal retirement, upon involuntary termination for reasons other than
violations of Company policies, theft or misappropriation of the Company's
assets or performance of any act which harms the Company, or upon permanent
and total disability or death, whichever occurs first. In the event of
retirement, involuntary termination for reasons other than as described
above, or disability, any unpaid deferred awards will be vested and paid
upon the completion of five years after the date of the award. Upon the
death of a participant, the Company has the option to either immediately pay
the award to the participant's estate or pay the award upon the completion
of five years after the date of the award.
(3) Includes the Company's contributions to its Savings and Profit Sharing Plan,
a qualified defined contribution plan which covers all full time employees
who have completed a certain minimum amount of service, and life insurance
premiums paid by the Company with respect to term life insurance on the life
of the named persons. Contributions to the Savings and Profit Sharing Plan
for fiscal 1997 were as follows: Mr. Wiener -- $3,030; Mr.
McCormack -- $3,030; Mr. Blalock -- $1,905; and Mr. Harmon -- $3,030; and
for fiscal 1996, such contributions were as follows: Mr. Wiener -- $2,353;
Mr. McCormack -- $3,165; Mr. Blalock -- $2,040; and Mr. Harmon -- $3,165.
There were no such contributions made in fiscal 1995. Life insurance
premiums paid by the Company with respect to term life insurance on the life
of the named persons for fiscal 1997 were as follows: Mr. Wiener -- $624;
Mr. McCormack -- $384; Mr. Blalock -- $303; and Mr. Harmon -- $303; for
fiscal 1996 such premiums were as follows: Mr. Wiener -- $624; Mr.
McCormack -- $364; Mr. Blalock -- $285; and Mr. Harmon -- $285; and for
fiscal 1995 such premiums were as follows: Mr. Wiener -- $624; Mr.
McCormack -- $337; Mr. Blalock -- $253; and Mr. Harmon -- $248.
(4) Reflects options to purchase shares of Common Stock granted to such persons
under the Company's Amended and Restated 1989 Stock Option Plan (the "Stock
Option Plan") in July 1996 at an exercise price of $10.375 per share. Such
options vest at the rate of 20% of such options when the market price per
share of the Common Stock equals or exceeds $15.00, $17.50, $20.00, $22.50
and $25.00.
(5) Reflects options to purchase shares of Common Stock granted to such persons
under the Company's Stock Option Plan in November 1994 at an exercise price
of $15.00 per share. Such options vest over a five-year period beginning
November 2, 1995 at the rate of 20% per year. All of such options were
cancelled and terminated in July 1996.
The following table sets forth information for each of the persons named in
the Summary Compensation Table with respect to the aggregate stock options
exercised during the fiscal year ended September 27, 1997, and stock options
held as of September 27, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FY-END(#) FY-END(#)(1)
SHARES --------------- ---------------------
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABLE
- -------------------------- ------------ ----------- --------------- ---------------------
<S> <C> <C> <C> <C>
Arthur C. Wiener -- $ -- 375,700/156,000 $4,115,388/$1,436,250
Robert McCormack -- -- 34,200/47,800 311,625/439,000
Charles A. Blalock 10,000 149,450 55,400/47,800 707,959/439,000
Michael R. Harmon -- -- 58,200/47,800 760,305/439,000
</TABLE>
- ---------------
(1) Based upon the closing price of the Common Stock of $19.625 on September 27,
1997, less the exercise price.
7
<PAGE>
RETIREMENT PLAN
The Company's Retirement Plan (the "Retirement Plan") covers all full-time
employees who have completed at least 1,000 hours of service during a period of
12 consecutive months beginning on such employees' employment commencement date
(or the anniversary thereof). The Retirement Plan recognizes credited service
with Burlington for membership eligibility and vesting purposes only. Under the
terms of the Retirement Plan (prior to its amendment effective April 1, 1992),
employees contributed at the rate of 1.5% of the first $6,600 of compensation in
a plan year and 3% of compensation in excess of $6,600, up to a compensation
limit which was adjusted annually. The Company's contributions, if any, were
determined annually on an actuarial basis. An employee's annual pension benefit
payable at normal retirement date (the first day of the month following the
month in which the employee's 65th birthday occurs) was equal to one-half of the
employee's total contribution while a member of the Retirement Plan. Such
benefit is payable in equal monthly installments for the life of the employee.
A reduced pension benefit is payable upon (i) early retirement at or after
age 55, (ii) death, (iii) disability, (iv) termination of employment after
completing five years of vesting service, or (v) termination due to lack of
work. Employees are always vested in their contributions. The normal form of
benefit payment is a straight life annuity for unmarried employees and a
(reduced) joint and survivor annuity for those who are married. Benefits may
also be received at the employee's election in the form of a lump sum payment
which is the present value of the employee's accrued benefit.
Effective as of April 1, 1992, the Retirement Plan was amended to provide
that employee contributions are neither required nor permitted. Under the
revised plan, the amount of a participant's annual retirement benefits (to be
paid in monthly installments) equals the sum of (i) the accrued benefit
determined under the formula described above as of March 31, 1992, and (ii) (a)
1% of a participant's average annual compensation paid on and after April 1,
1992, plus (b) 0.5% of a participant's average annual compensation in excess of
his or her social security covered compensation, multiplied by his or her years
of service completed after March 31, 1992 (not in excess of 35 years). The
compensation described in (ii) above was limited to $150,000 in fiscal 1997.
The estimated annual benefits payable upon retirement at normal retirement
age (assuming no increase in present salary levels) to the persons named in the
Summary Compensation Table are as follows: Arthur C. Wiener -- $40,215; Robert
McCormack -- $55,533; Charles A. Blalock -- $48,086 and Michael R.
Harmon -- $47,331.
8
<PAGE>
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Effective for fiscal 1994, the Company established a non-qualified,
unfunded supplementary retirement plan under which the Company will pay
supplemental pension benefits to key executives. The plan is intended to
supplement retirement benefits received under the Retirement Plan and from
Social Security. The amounts set forth in the table below represent total annual
pension benefits received under the Supplemental Executive Retirement Plan, the
Retirement Plan and Social Security which are payable monthly upon retirement at
age 65 or older for the participant's lifetime. The pension benefits payable
under the Supplemental Executive Retirement Plan are based on a straight life
annuity and are reduced for both Social Security benefits and the annual benefit
payable from the Retirement Plan. A discount of five percent per year is applied
for retirement before age 65.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
AVERAGE OF FINAL FIVE CONSECUTIVE ------------------------------------------------------------------------
YEARS OF COMPENSATION 5 10 15 20 25 30
- --------------------------------- ------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
$ 200,000 $17,500 $ 35,000 $ 52,500 $ 70,000 $ 87,500 $105,000
250,000 21,875 43,750 65,625 87,500 109,375 131,250
300,000 26,250 52,500 78,750 105,000 131,250 157,500
350,000 30,625 61,250 91,875 122,500 153,125 183,750
400,000 35,000 70,000 105,000 140,000 175,000 210,000
450,000 39,375 78,750 118,125 157,500 196,875 236,250
500,000 43,750 87,500 131,250 175,000 218,750 262,500
550,000 48,125 96,250 144,375 192,500 240,625 288,750
600,000 52,500 105,000 157,500 210,000 262,500 315,000
650,000 56,875 113,750 170,625 227,500 284,375 341,250
700,000 61,250 122,500 183,750 245,000 306,250 367,500
750,000 65,625 131,250 196,875 262,500 328,125 393,750
800,000 70,000 140,000 210,000 280,000 350,000 420,000
850,000 74,375 148,750 223,125 297,500 371,875 446,250
900,000 78,750 157,500 236,250 315,000 393,750 472,500
950,000 83,125 166,250 249,375 332,500 415,625 498,750
</TABLE>
The average of the final five consecutive years of compensation includes
the participant's salary and bonus. The persons named in the Summary
Compensation Table have each been credited with approximately ten years of
service. The net pension cost for fiscal 1997 was $241,025 for approximately
thirty employees currently participating in the Supplemental Executive
Retirement Plan.
SEVERANCE PLAN
Under the Company's Severance Plan, the Company makes payroll severance
payments and vacation severance payments to eligible full-time salaried
employees who are involuntarily terminated from the Company. The right to
receive payroll severance benefits does not vest until termination of
employment, as determined by eligibility and benefit schedules in effect on the
date of termination, which may be changed by the Company at any time. Vacation
severance payments are based upon a person's length of continuous employment
with the Company, less vacation taken during the calendar year. If a Company
facility is sold as an ongoing business, an employee of such facility remaining
employed by the Company until the effective date of such sale is eligible for
severance benefits if such employee (i) is not offered employment by the
purchaser or successor employer or (ii) refuses an offer of employment in a less
than comparable position or for less than a substantially equivalent base
salary. Employees who continue to be employed by the successor entity are not
eligible for severance benefits.
As of September 27, 1997, the persons named in the Summary Compensation
Table were eligible to receive the following amounts in the event of involuntary
termination: Arthur C. Wiener -- $250,000; Robert McCormack -- $81,668; Charles
A. Blalock -- $140,000; and Michael R. Harmon -- $140,000.
9
<PAGE>
COMPENSATION OF DIRECTORS
Pursuant to the Company's Restricted Stock Plan and Stock Option Plan, each
of the Company's directors who is not an employee of the Company makes an
irrevocable election (i) to receive annually and at the time such person becomes
a director either (a) options to purchase up to 2,000 shares of Common Stock
granted under the Company's Stock Option Plan or (b) 1,200 shares of Common
Stock issued pursuant to the Company's Restricted Stock Plan, and (ii) on or
prior to December 1 of each calendar year or at the time such person becomes a
director, to receive all of his or her annual director's fee, beginning for the
1997 calendar year, (a) in cash in the amount of $20,000, or (b) in the form of
a grant of stock options to purchase up to 2,500 shares of Common Stock under
the Company's Stock Option Plan, or (c) in the form of a combination of $10,000
in cash plus an amount of shares of Common Stock issued under the Restricted
Stock Plan having an aggregate fair market value on the date of issuance equal
to $15,000; PROVIDED, HOWEVER, that in the event any person makes such election
at the time he or she becomes a director, such non-employee director shall
receive a PRO RATA portion of his or her annual director's fee (whether in cash,
stock options granted under the Stock Option Plan or a combination of cash and
shares of Common Stock issued under the Restricted Stock Plan) based upon the
remaining portion of the calendar year in which such person becomes a director.
In addition, each non-employee director receives $1,000 for each Board committee
meeting attended (other than for a Board committee meeting held on the same date
as a meeting of the Board of Directors). During fiscal 1997, each of Messrs.
Abraham, Gillease, Holt, Jacobs, Mapel and Sherrill were issued 2,400 shares of
Common Stock under the Restricted Stock Plan. In addition, the Company paid to
each of Messrs. Abraham, Gillease, Holt, Jacobs, Mapel and Sherrill $18,717 in
payment of a portion of their income tax liability as a result of receiving such
shares under the Restricted Stock Plan. In February 1997, Mr. Thomas was granted
options under the Stock Option Plan to purchase 2,000 shares of Common Stock at
an exercise price of $18.375 per share. Messrs. Abraham, Holt, Jacobs and Mapel
each received an annual director's fee of $20,000 and, in lieu of such annual
cash director's fee, (i) Mr. Thomas was granted options in January 1997 to
purchase up to 2,500 shares of Common Stock under the Company's Stock Option
Plan and Messrs. Gillease and Sherrill each received, in January 1997, a
combination of $10,000 in cash and 992 shares of Common Stock issued under the
Restricted Stock Plan.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee") is
composed of three non-employee directors and has general oversight, review and
approval responsibilities with respect to the compensation of the Company's
executive officers. The Committee has on occasion engaged an independent
consultant to assist it in carrying out its duties, particularly as such duties
relate to the structure and competitive positioning of the Company's
compensation program.
The Company's executive compensation program is designed to attract and
retain qualified executives with competitive levels of compensation that are
related to performance goals and which recognize individual initiative and
accomplishments. The principal components of the Company's executive
compensation program are fixed compensation in the form of base salary, variable
compensation in the form of annual cash incentive bonuses, stock options and
awards under the Company's Deferred Compensation Program. The Company does not
have employment agreements with any of its executive officers or other
employees.
BASE SALARY. Mr. Wiener, the Company's Chairman of the Board, President and
Chief Executive Officer, makes recommendations to the Committee regarding the
base salaries of all executive officers. Following the Committee's discussion,
review and, if necessary, modification of such recommendations, the base
salaries of all executive officers are approved by the Committee. The Committee
considers various factors in its review, including the executive officer's job
responsibilities and performance, experience and years of service with the
Company, the business outlook for the Company and a comparison of base salaries
for comparable positions at other textile manufacturing and general industrial
companies of approximately the same size based on revenues. The Committee
believes that base salaries of executive officers are competitive with respect
to such group of companies. Salary adjustments are based on an annual evaluation
of the performance of the Company and each executive officer, and take into
account any new responsibilities of the executive.
ANNUAL INCENTIVE BONUS. The Company has an Incentive Bonus Plan (the
"Incentive Plan"), pursuant to which incentive cash bonuses are payable annually
to executive officers and certain other key employees based upon the amount by
which the Company's earnings before interest, taxes, depreciation and
amortization ("EBITDA") for
10
<PAGE>
each fiscal year exceed established targets and, in some cases, certain specific
performance criteria for individual participants. The performance criteria are
based upon the Company achieving measurable performance goals in a participant's
principal area of responsibility, such as marketing and manufacturing goals.
Under the Incentive Plan, a significant portion of each participant's total
compensation is at risk and is dependent upon the Company's overall financial
performance and such participant's individual accomplishments.
The Incentive Plan is reviewed annually by the Committee and is thereafter
presented, with the Committee's recommendations, to the Company's Board of
Directors for its approval. The initial recommendation of targeted EBITDA levels
is made at the beginning of each fiscal year by the Chairman of the Board,
President and Chief Executive Officer of the Company and, following discussion,
review and, at times, modification, is approved by the Committee and the Board
of Directors. In addition, the aggregate amount available to be paid under the
Incentive Plan is approved by the Committee and the Board of Directors and is
increased by specified percentages as the amount the Company's actual EBITDA
exceeds the established target level up to a certain prescribed maximum. The
Chairman of the Board, President and Chief Executive Officer designates, at the
beginning of each fiscal year, the maximum percentage (the "incentive
percentage") of the bonus that each participant may receive if the Company's
EBITDA equals or exceeds the established target level. In addition, with respect
to certain participants, their right to receive a portion of such incentive
percentage is dependent upon achieving the performance criteria established for
such participants, as described above. Such incentive percentages are reviewed
and approved by the Committee. In the event the Company does not achieve the
threshold level of EBITDA for the fiscal year, the executive officers of the
Company and the other participants in the Incentive Plan, with the exception of
the Chairman of the Board, President and Chief Executive Officer, may be awarded
a cash amount based on specific performance criteria, as recommended by the
Chairman of the Board, President and Chief Executive Officer and approved by the
Committee.
In addition, the Company has a Deferred Compensation Program (the "Deferred
Plan"), a non-qualified, unfunded plan under which executive officers and other
key executives receive annually a deferred compensation award. Under the
Deferred Plan, which was approved by the Company's Board of Directors upon the
Committee's recommendations, an aggregate amount available to be awarded
annually under the Deferred Plan was established (the "deferred pool"). Each
executive is entitled to receive an annual deferred compensation award in an
amount equal to 30% of the amount of such executive's incentive cash bonus award
under the Incentive Plan for such year. In the event that the aggregate amount
of all deferred compensation awards as calculated in accordance with such
formula exceeds the amount of the deferred pool, the amount of each executive's
deferred compensation award will be reduced pro rata so that all such awards do
not exceed the amount of the deferred pool. Participants in the Deferred Plan
will only be vested in the current year award upon the completion of five years
of service after the date of the award, upon normal retirement, upon involuntary
termination for reasons other than violations of Company policies, theft or
misappropriation of the Company's assets or performance of any act which harms
the Company, or upon permanent and total disability or death, whichever occurs
first. In the event of retirement, involuntary termination for reasons other
than as described above, or disability, any unpaid deferred awards will be
vested and paid upon the completion of five years after the date of the award.
Upon the death of a participant, the Company has the option to either
immediately pay the award to the participant's estate or pay the award upon the
completion of five years after the date of the award.
STOCK OPTIONS. The Committee believes that the significant equity interests
in the Company held by the Company's executive officers have served to link the
interests of the executives with those of the stockholders. Under the Company's
Stock Option Plan, options to purchase shares of Common Stock may be granted to
the executive officers of the Company. The Committee believes that the grant of
stock options will continue as an important component of the Company's executive
compensation program.
In July 1996, the Committee approved a new stock option program designed to
focus the efforts of the Company's management team and other key employees
towards enhancing stockholder value. The intent of this special program is to
signal to the Company's executive officers, other members of the management team
and other key employees that, while they had performed exceptionally well in the
past, the benefits to be derived from the receipt of stock options in the future
should be tied to the market price of the Company's Common Stock in order to
promote the creation of stockholder value. As a result, the decision was made to
grant stock options under the Stock Option Plan to the executive officers and
other members of the Company's management team and its key employees which would
vest upon the market price per share of the Company's Common Stock achieving
certain levels; the
11
<PAGE>
Company's option grants in the past provided for vesting over time. During
fiscal 1997, no stock options were granted to any of the executive officers
named in the Summary Compensation Table.
CHIEF EXECUTIVE OFFICER COMPENSATION. Compensation for Mr. Wiener, the
Company's Chairman of the Board, President and Chief Executive Officer, is
generally established in accordance with the principles described above. The
Committee reviews Mr. Wiener's performance and establishes his base salary
considering the various factors described above for executive officers. The
amount of Mr. Wiener's annual incentive cash bonus under the Incentive Plan is
based upon whether the Company's overall performance meets or exceeds targets
established in the Company's business plan which is approved by the Board of
Directors at the beginning of each fiscal year. Mr. Wiener's base salary
increased by $50,000 for fiscal 1997 as compared to fiscal 1996 and fiscal 1995.
The amount of his annual incentive cash bonus has fluctuated depending upon the
EBITDA levels achieved by the Company.
The Compensation Committee of the Board of
Directors
Lee Abraham
Paul G. Gillease
William deR. Holt
12
<PAGE>
PERFORMANCE COMPARISON
The following graph compares, from October 2, 1992, the cumulative total
stockholder return on the Common Stock with the cumulative total returns of the
S&P 500 Index and a peer group. The graph assumes that the value of the
investment in the Common Stock and each index was $100 on October 2, 1992 and
that all dividends were reinvested.
The peer group is comprised of the following domestic textile
manufacturers: Burlington Industries, Inc.; Cone Mills Corporation, Inc.; Delta
Woodside Industries, Inc.; Dyersburg Corporation; Forstmann & Company, Inc.;
Guilford Mills, Inc.; Lida Inc. (which is included in the peer group until
August 31, 1995, the date the securities of Lida Inc. ceased trading); Springs
Industries, Inc.; and Texfi Industries, Inc. The return of each Company in the
peer group has been weighted according to its respective stock market
capitalization. Data for the graph were provided by Standard & Poor's Compustat
Services, Inc.
[GRAPH APPEARS BELOW WITH THE FOLLOWING PLOT POINTS:]
COMPARISON OF CUMULATIVE TOTAL RETURN
GALEY & LORD, INC., S&P 500 & PEER GROUP
<TABLE>
<CAPTION>
BASE PERIOD
SEPT. 1992 SEPT. 1993 SEPT. 1994 SEPT. 1995 SEPT. 1996 SEPT. 1997
<S> <C> <C> <C> <C> <C> <C>
GALEY & LORD $100.00 $96.74 $176.26 $119.57 $111.96 $164.13
S & P 500 $100.00 $113.00 $117.17 $152.02 $182.93 $256.92
PEER GROUP $100.00 $97.58 $87.54 $92.44 $83.33 $113.89
</TABLE>
RELATED TRANSACTIONS
The law firm of Rosenman & Colin LLP, New York, New York, of which Howard
S. Jacobs, a director of the Company, is a member, has acted as counsel to the
Company since March 1994. Legal fees for services rendered by Rosenman & Colin
LLP to the Company during the fiscal year ended September 27, 1997 did not
exceed 5% of the revenues of such firm for its most recent fiscal year.
13
<PAGE>
PROPOSAL 2 -- RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors, upon the recommendation of its Audit Committee, has
selected Ernst & Young LLP as independent auditors to audit and report upon the
consolidated financial statements of the Company for the 1998 fiscal year and is
submitting this matter to the stockholders for their ratification. Ernst & Young
LLP served as the Company's independent auditors in fiscal 1997 and in prior
years. Assuming a quorum is present, a vote of a majority of the votes cast at
the Meeting, in person or by proxy, is required for the ratification of the
selection of Ernst & Young LLP. Abstentions and broker non-votes are not counted
as votes cast. If stockholders do not ratify the selection of Ernst & Young LLP,
the Board of Directors will consider other independent auditors. Representatives
of the firm of Ernst & Young LLP will be present at the Meeting to make a
statement if they desire to do so and to be available to respond to appropriate
questions that may be asked by stockholders.
ANNUAL REPORT
All stockholders of record as of December 22, 1997 are concurrently being
sent a copy of the Company's Annual Report for the fiscal year ended September
27, 1997 which contains audited financial statements of the Company for the
fiscal years ended September 30, 1995, September 28, 1996, and September 27,
1997.
STOCKHOLDER PROPOSALS
Stockholder proposals must be received by September 11, 1998 in order to be
considered for inclusion in proxy materials distributed in connected with the
next annual meeting of stockholders.
MISCELLANEOUS
As of the date of this Proxy Statement, the Board of Directors of the
Company does not know of any other matter to be brought before the Meeting.
However, if any other matters not mentioned in the Proxy Statement are brought
before the Meeting or any adjournments thereof, the persons named in the
enclosed Proxy or their substitutes will have discretionary authority to vote
proxies given in said form or otherwise act, in respect of such matters, in
accordance with their best judgment.
All of the costs and expenses in connection with the solicitation of
proxies with respect to the matters described herein will be borne by the
Company. In addition to solicitation of proxies by use of the mails, directors,
officers and employees (who will receive no compensation therefor in addition to
their regular remuneration) of the Company may solicit the return of proxies by
telephone, telegram or personal interview. The Company will request banks,
brokerage houses and other custodians, nominees and fiduciaries to forward
copies of the proxy materials to their principals and to request instructions
for voting the proxies. The Company may reimburse such banks, brokerage houses
and other custodians, nominees and fiduciaries for their expenses in connection
therewith.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH BENEFICIAL OWNER OF COMMON
STOCK ON THE RECORD DATE, ON THE WRITTEN REQUEST OF ANY SUCH PERSON, A COPY OF
THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED SEPTEMBER 27,
1997 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. ANY SUCH REQUEST
SHOULD BE MADE IN WRITING TO MICHAEL R. HARMON, SECRETARY, GALEY & LORD, INC.,
P.O. BOX 35528, GREENSBORO, NORTH CAROLINA 27425.
It is important that proxies be returned promptly. Stockholders are,
therefore, urged to fill in, date, sign and return the Proxy immediately. No
postage need be affixed if mailed in the enclosed envelope in the United States.
By order of the Board of Directors
/s/ Michael R. Harmon
MICHAEL R. HARMON
SECRETARY
January 9, 1998
14
<PAGE>
P GALEY & LORD, INC.
R
O ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON FEBRUARY 10, 1998
X
Y THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Arthur C. Wiener and
Michael R. Harmon, or either of them acting singly in the absence of the other,
with the power of substitution in either of them, the proxies of the undersigned
to vote with the same force and effect as the undersigned all shares of Common
Stock of Galey & Lord, Inc. (the "Company") held of record by the undersigned on
December 22, 1997 at the Annual Meeting of Stockholders to be held at Club 101,
101 Park Avenue, New York, New York 10178, on February 10, 1998, at 10:30 A.M.,
Local Time, and at any adjournment or adjournments thereof, hereby revoking any
proxy or proxies heretofore given and ratifying and confirming all that said
proxies may do or cause to be done by virtue thereof with respect to the
following matters:
1. The election of eight directors nominated by the Board of Directors:
<TABLE>
<S> <C>
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote for
(except as indicated below) the nominees listed below
</TABLE>
ARTHUR C. WIENER, LEE ABRAHAM, PAUL G. GILLEASE, WILLIAM deR. HOLT, HOWARD S.
JACOBS, WILLIAM M.R. MAPEL, STEPHEN C. SHERRILL and DAVID F. THOMAS
(INSTRUCTION: To withhold authority to vote for any individual nominee or
nominees write such nominee's or nominees' names in the space provided below.)
- ----------------------------------------------------------------------------
2. The ratification of the selection of Ernst & Young LLP as independent
auditors of the Company for the 1998 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Upon such other business as may properly come before the Meeting or any
adjournment thereof.
<PAGE>
This proxy, when properly executed, will be
voted as directed. If no direction is indicated,
the proxy will be voted (i) FOR the election of
the eight named individuals as directors and
(ii) FOR the ratification of the selection of
Ernst & Young LLP as independent auditors of the
Company for the 1998 fiscal year.
The undersigned hereby acknowledges receipt
of the Notice of Annual Meeting of Stockholders
to be held on February 10, 1998 and the Proxy
Statement, dated January 9, 1998, prior to the
signing of this proxy. Dated: __________________________, 1998
_______________________________ (L.S.)
_______________________________ (L.S.)
_______________________________ (L.S.)
Please sign your name exactly as it
appears hereon. When signing as
attorney, executor, administrator,
trustee or guardian, please give your
full title as it appears hereon. When
signing as joint tenants, all parties
in the joint tenancy must sign. When a
proxy is given by a corporation, it
should be signed by an authorized
officer and the corporate seal affixed.
No postage is required if returned in
the enclosed envelope and mailed in the
United States.
PLEASE SIGN, DATE AND MAIL THIS PROXY
IMMEDIATELY IN THE ENCLOSED ENVELOPE.
