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
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:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
( ) Fee paid previously with preliminary materials.
( ) Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
GALEY & LORD, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD FEBRUARY 8, 2000
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 the Company's executive offices, 980 Avenue of the Americas, New
York, New York 10018, on Tuesday, February 8, 2000 at 10:30 A.M., Local Time,
to consider and act upon the following:
1. To elect seven 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 2000 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 30, 1999 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 30,
1999 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 10, 2000
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>
<PAGE>
GALEY & LORD, INC.
980 Avenue of the Americas
New York, New York 10018
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
FEBRUARY 8, 2000
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 the Company's executive
offices, 980 Avenue of the Americas, New York, New York 10018, on Tuesday,
February 8, 2000 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 10, 2000.
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 2000 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 30, 1999
(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
11,902,915 shares of the Company's Common Stock, $.01 par value (the "Common
Stock"), which figure does not include an additional 389,206 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, seven directors are to be elected to serve as the Board of
Directors of the Company 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 seven nominees of the Board of Directors named below as
directors of the Company. All of the seven 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.
NOMINEES FOR DIRECTOR
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 62 Chairman of the Board,
President and Chief
Executive Officer
Michael T. Bradley 33 Director
Paul G. Gillease 67 Director
William deR. Holt 71 Director
Howard S. Jacobs 56 Director
William M.R. Mapel 68 Director
Stephen C. Sherrill 46 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"), a manufacturer of textile products, 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. Bradley has been a director of the Company since November 1998. Mr.
Bradley has been employed by Citicorp Venture Capital, Ltd. ("CVC"), a venture
capital and leveraged buyout company, which is a subsidiary of Citibank, N.A.,
a wholly-owned subsidiary of Citicorp, which is a wholly-owned subsidiary of
Citigroup Inc., since April 1996, and has served as a Vice President since
1998. Mr. Bradley received an MBA from Columbia Business School in 1996 and a
JD from the University of Virginia Law School in 1991. Between 1989 and 1991,
he was an analyst at Select Equity Group, Inc. in New York, an equity research
firm. From August 1988 to September 1989, Mr. Bradley was an assistant
financial consultant at Merrill Lynch in Paris, France.
Mr. Gillease has been a director of the Company 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., a manufacturer of knitted textiles.
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 Vice
President
2
<PAGE>
and Chairman of the Policy Committee of the North American Finance Group from
1986 to September 1988. Mr. Mapel is a director of Brundage, Story & Rose
Investment Trust, a registered investment company; and Churchill Capital
Partners, a registered investment company.
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 CVC. Mr. Sherrill is a director of Jitney Jungle Stores of America
Inc., a regional chain of grocery stores; Doane Pet Care Enterprises, a
manufacturer and distributor of pet food products; B&G Foods Inc., a
manufacturer, marketer and distributor of food products; Mediq, Inc., a
hospital equipment rental company; and Alliance Laundry Systems LLC, a
manufacturer of commercial laundry equipment.
DIRECTORS SERVING UNTIL THE MEETING
The following table sets forth the name of the director whose term expires
at the date of the Meeting and who is not a candidate for election, his age and
current position with the Company:
<TABLE>
<CAPTION>
NAME AGE TITLE
- ------------------- ----- ---------
<S> <C> <C>
David F. Thomas 50 Director
</TABLE>
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 Lifestyle Furnishings International
Ltd., Anvil Knitwear, Inc. American Commercial Lines, LLC, Neenah Foundry Co.,
Plainwell Holding Co., and Sleepmaster, LLC.
Lee Abraham, a director of the Company since 1993, retired as a director
in November 1999.
During the last fiscal year, there were five meetings of the Board of
Directors of the Company and action was taken by the directors by unanimous
written consent in lieu of a meeting on one occasion. 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.
The Board of Directors has designated from among its members an Audit
Committee, which currently consists of Messrs. Jacobs and Mapel. Mr. Thomas
served on the Audit Committee during the 1999 fiscal year until his resignation
from the Audit Committee in May 1999. The Audit Committee, which reviews the
Company's financial and accounting practices and controls, held two meetings
during the 1999 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 currently consists of Messrs. Gillease and
Holt. Lee Abraham, a former director of the Company, served on the Compensation
Committee until his retirement as a director in November 1999. The Compensation
Committee held four meetings during the 1999 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 one 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. Although
such agreement provides for one designee of CVC to be nominated as a director
of the Company, both Mr. Thomas and Mr. Bradley are serving as designees of CVC
and Mr. Wiener has agreed to vote all shares of Common Stock owned by him for
the election of Mr. Bradley as a director of the Company at the Meeting.
3
<PAGE>
EXECUTIVE OFFICERS
Set forth below is certain information regarding the executive officers
and certain other officers of the Company:
<TABLE>
<CAPTION>
NAME AGE CURRENT POSITION
- -------------------- ----- -------------------------------------------------------------
<S> <C> <C>
Arthur C. Wiener 62 Chairman of the Board, President and Chief Executive Officer
Robert McCormack 50 Executive Vice President and President -- Woven Division,
Apparel Marketing Group
Charles A. Blalock 52 Executive Vice President of Manufacturing
Michael R. Harmon 52 Executive Vice President, Chief Financial Officer, Treasurer
and Secretary
John J. Heldrich 47 Executive Vice President and President -- Swift Denim Group
Giuseppe Rodino 60 President -- Klopman International Group
</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."
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.
Mr. Heldrich has been Executive Vice President of the Company since
February 1998 and President of the Company's Swift Denim Group since the
Company's acquisition of the divisions and subsidiaries comprising the Swift
Denim Group on January 29, 1998. Prior to the Company's acquisition of Swift
Denim, Mr. Heldrich had been President of Swift Denim since August 1994. He was
President of Swift Marketing Worldwide from July 1991 to August 1994. Mr.
Heldrich was President of the Fashion Apparel Division of Milliken & Company
Inc. in New York from 1987 through 1991. From 1974 to 1987, Mr. Heldrich held
various marketing and manufacturing positions at Milliken & Company Inc. in New
York, South Carolina, and the United Kingdom.
Mr. Rodino has been President of the Company's Klopman International Group
since the Company's acquisition of the divisions and subsidiaries comprising
the Klopman Group on January 29, 1998. Mr. Rodino was President of Klopman
International from January 1993 to the Company's acquisition of Klopman
International. From April 1991 to January 1993, Mr. Rodino was General Manager
of C.D.I. for Ring Denim Fabrics and M.C.M. for cotton fabrics for Leisurewear
at the Imatessile Group. From June 1989 to April 1991, Mr. Rodino was Managing
Director of Faema S.p.A. Between 1966 and 1989, Mr. Rodino held various sales
and managerial positions at Klopman Mills and Klopman International in New
York, Rome and London.
4
<PAGE>
SECURITY OWNERSHIP
The following table sets forth certain information as of December 30, 1999
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 5,616,102(1) 47.2%
399 Park Avenue
New York, New York 10043
Dimensional Fund Advisors, Inc. None 1,044,300(2) 8.8%
1099 Ocean Avenue, 11th Floor
Santa Monica, California 90401
Arthur C. Wiener Chairman of the Board, 1,149,700(3) 9.2%
980 Avenue of the Americas President and Chief
New York, New York 10018 Executive Officer
Michael T. Bradley Director 6,850(4) *
Paul G. Gillease Director 19,057(5) *
William deR. Holt Director 26,400(6) *
Howard S. Jacobs Director 27,600(7) *
William M. R. Mapel Director 28,000(8) *
Stephen C. Sherrill Director 131,712(9) 1.1%
David F. Thomas Director 60,208(10) *
102,025(11) *
Charles A. Blalock Executive Vice President
of Manufacturing
Michael R. Harmon Executive Vice President, 136,830(12) 1.1%
Chief Financial Officer,
Treasurer and Secretary
John J. Heldrich Executive Vice President 23,000(13) *
and President -- Swift
Denim Group
Robert McCormack Executive Vice President 95,000(14) *
and President -- Woven
Division, Apparel
Marketing Group
All directors and executive officers 1,806,382(15) 14.2%
as a group (12 persons)
</TABLE>
- ---------
* Less than one percent (1%).
(1) Based upon information contained in a Statement of Changes in Beneficial
Ownership on Form 4 (the "Form 4") filed by Citigroup Inc. with the
Securities and Exchange Commission (the "SEC") on October 8, 1999.
Citibank Venture Capital, Ltd. ("CVC") is a wholly-owned subsidiary of
Citibank, N.A.; Citibank, N.A. is a wholly-owned subsidiary of Citicorp
which is a wholly-owned subsidiary of Citigroup Inc. 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 with the SEC on
February 11, 1999 (the "Schedule 13G") and a Schedule 13F filed with the
SEC on September 30, 1999 by Dimensional Fund Advisors Inc.
("Dimensional"), an investment advisor registered under the Investment Act
of 1940 (the "Advisors Act"). Dimensional furnishes investment advice to
four investment companies registered under the Investment Company Act of
1940 and serves as investment manager to certain other investment
vehicles, including commingled trust groups. (such investments companies
and investment vehicles are collectively referred to herein as the
"Portfolios"). Dimensional possesses both voting and investment power over
the shares that are owned by the Portfolios. All the shares are owned by
the Portfolios and Dimensional disclaims beneficial ownership of the
shares.
5
<PAGE>
(3) Includes (i) 8,000 shares held by the Wiener Foundation, a not-for-profit
corporation controlled by Mr. Wiener and his immediate family members, and
(ii) 531,700 shares subject to currently exercisable stock options.
(4) Includes 6,850 shares subject to currently exercisable stock options.
(5) Includes (i) 6,000 shares subject to currently exercisable stock options,
(ii) 11,200 shares issued under and subject to the Restricted Stock Plan,
and (iii) 500 shares held by Mr. Gillease's wife.
(6) Includes (i) 10,000 shares subject to currently exercisable stock options,
and (ii) 6,400 shares issued under and subject to the Restricted Stock
Plan.
(7) Includes (i) 8,000 shares subject to currently exercisable stock options,
and (ii) 7,600 shares issued under and subject to the Restricted Stock
Plan.
(8) Includes (i) 8,000 shares subject to currently exercisable stock options,
and (ii) 7,600 shares issued under and subject to the Restricted Stock
Plan.
(9) Includes (i) 11,000 shares subject to currently exercisable stock options,
and (ii) 11,200 shares issued under and subject to the Restricted Stock
Plan.
(10) Includes 18,000 shares subject to currently exercisable stock options.
(11) Includes (i) 53,100 shares subject to currently exercisable stock options,
and (ii) 23,225 shares held by Mr. Blalock's wife.
(12) Includes (i) 70,500 shares subject to currently exercisable stock options,
(ii) 17,000 shares held in a self-directed individual retirement account,
and (iii) 11,919 shares held by Mr. Harmon's wife.
(13) Includes 18,000 shares subject to currently exercisable stock options.
(14) Includes 62,000 shares subject to currently exercisable stock options.
Excludes 5,400 shares subject to currently exercisable stock options held
by Mr. McCormack's wife, as to which Mr. McCormack disclaims beneficial
ownership.
(15) Includes (i) 803,150 shares subject to currently exercisable stock
options, and (ii) 44,000 shares issued under and subject to the Restricted
Stock Plan. Excludes 5,400 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.
6
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes compensation paid by the Company during
fiscal 1997, 1998 and 1999 to the Company's Chairman of the Board, President
and Chief Executive Officer and its four other most highly compensated
executive officers (together, the "Named Executive Officers") for services
rendered in all capacities to the Company and its subsidiaries.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
-------------------------------------------------
OTHER ANNUAL
FISCAL COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($)(1) ($)(2)
- ----------------------------- -------- ----------- ------------- --------------
<S> <C> <C> <C> <C>
Arthur C. Wiener 1999 $ 600,000 $ -- $ --
Chairman of the Board, 1998 600,000 320,000 96,000
President and Chief 1997 550,000 377,000 113,100
Executive Officer
John J. Heldrich (4) 1999 $ 443,751 $ -- --
Executive Vice President, 1998 275,228 25,000 --
President -- Swift Denim
Group
Robert McCormack 1999 $ 345,837 $ -- $ --
Executive Vice President 1998 267,919 90,000 27,000
and President -- Woven 1997 245,004 90,060 27,018
Division, Apparel
Marketing Group
Charles A. Blalock 1999 $ 240,000 $ -- $ --
Executive Vice President 1998 222,500 90,000 27,000
of Manufacturing 1997 193,340 90,060 27,018
Michael R. Harmon 1999 $ 240,000 $ -- $ --
Executive Vice President, 1998 222,500 90,000 27,000
Chief Financial Officer, 1997 193,340 90,060 27,018
Treasurer and Secretary
<CAPTION>
AWARDS PAYOUTS
---------------------------- ---------
RESTRICTED SECURITIES
STOCK UNDERLYING LTIP ALL OTHER
AWARD(S) OPTIONS/ PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION ($) SARS(#) ($) ($)(3)
- ----------------------------- ------------ --------------- --------- -------------
<S> <C> <C> <C> <C>
Arthur C. Wiener -- -- -- $4,333
Chairman of the Board, -- -- -- 3,602
President and Chief -- -- -- 3,654
Executive Officer
John J. Heldrich (4) -- -- -- $7,191
Executive Vice President, -- 30,000(5) 5,703
President -- Swift Denim
Group
Robert McCormack -- -- -- $4,618
Executive Vice President -- -- -- 3,397
and President -- Woven -- -- -- 3,414
Division, Apparel
Marketing Group
Charles A. Blalock -- -- -- $4,301
Executive Vice President -- -- -- 3,325
of Manufacturing -- -- -- 2,208
Michael R. Harmon -- -- -- $4,301
Executive Vice President, -- -- -- 3,325
Chief Financial Officer, -- -- -- 3,333
Treasurer and Secretary
</TABLE>
- ---------
(1) Reflects cash bonuses accrued under the Company's Incentive Bonus Plan.
(2) Reflects deferred compensation incentive awards granted under the Company's
Deferred Compensation Program, a non- qualified, unfunded plan established
in fiscal 1994 by the Company under which certain 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 normal retirement, upon involuntary termination for
reasons other than viola tions 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, invol untary 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
(i) for fiscal 1999 were as follows: Mr. Wiener -- $3,564; Mr. McCormack --
$3,600; Mr. Blalock -- $3,600; Mr. Harmon -- $3,600; and Mr. Heldrich --
$4,800; (ii) for fiscal 1998 were as follows Mr. Wiener -- $2,978; Mr.
McCormack -- $2,978; Mr. Blalock -- $2,978; and Mr. Harmon -- $2,978; and
(iii) for fiscal 1997 were as follows; Mr. Wiener -- $3,030; Mr. McCormack
-- $3,030; Mr. Blalock -- $1,905; and Mr. Harmon -- $3,030. Life insurance
premiums paid by the Company with respect to term life insurance on the life
of the named persons (a) for fiscal 1999 were as follows: Mr. Wiener --
$769; Mr. McCormack -- $1,018; Mr. Blalock -- $701; Mr. Harmon -- $701 and
Mr. Heldrich -- $1,139; (b) for fiscal 1998 were as follows: Mr. Wiener --
$624; Mr. McCormack -- $419; Mr. Blalock -- $347; Mr. Harmon -- $347 and Mr.
Heldrich -- $1,664 and (c) for fiscal 1997 were as follows: Mr. Wiener --
$624; Mr. McCormack -- $384; Mr. Blalock -- $303; and Mr. Harmon -- $303.
The premium paid by the Company with respect to split-dollar life insurance
on the life of Mr. Heldrich for fiscal 1999 was $1,139 and for fiscal 1998
was $4,039.
(4) Mr. Heldrich has been employed by the Company since the acquisition by the
Company of Swift Denim on January 29, 1998, and all amounts listed reflect
compensation paid to, or earned by, Mr. Heldrich since such date.
(5) Reflects options to purchase shares of Common Stock granted to Mr. Heldrich
under the 1989 Stock Option Plan in February 1998 at an exercise price of
$15.688 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 $20.00,
$22.50, $25.00, $27.50 and $30.00.
7
<PAGE>
No stock options were granted to the Named Executive Officers during the
fiscal year ended October 2, 1999. The following table sets forth information
for each of the Named Executive Officers with respect to the aggregate stock
options exercised during the fiscal year ended October 2, 1999, and stock
options held as of October 2, 1999.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
FY-END(#) FY-END($)(1)
SHARES ----------------- --------------
ACQUIRED
ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABLE
- ---------------------- ------------- ------------ ----------------- --------------
<S> <C> <C> <C> <C>
Arthur C. Wiener -- -- 531,700/ 0 $66,700/ 0
Robert McCormack -- -- 62,000/ 0 0/ 0
Charles A. Blalock -- -- 53,100/ 0 0/ 0
Michael R. Harmon 12,000 $98,340 58,500/ 0 0/ 0
John J. Heldrich -- -- 18,000/12,000 0/ 0
</TABLE>
- ---------
(1) Based upon the closing price of the Common Stock of $2.75 on October 1,
1999, less the exercise price.
RETIREMENT PLANS
The Retirement Plan of Galey & Lord (the "Retirement Plan") covers all
full-time domestic employees (excluding hourly paid employees of Swift Denim
who are covered under separate plans). 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.
Effective as of April 1, 1992, the Retirement Plan was amended to provide
that employee contributions are neither required nor permitted. Under the 1992
Amendment (the "1992 Amendment"), 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
$160,000 in fiscal 1999.
Effective as of January 1, 1999, the Retirement Plan and Swift Denim's
Defined Benefit Retirement Plan merged and the merged plan was amended to
provide that a participant's lump sum retirement benefit is equal to the
participant's average annual compensation for the highest five consecutive
calendar years multiplied by the participant's accumulated pension equity
credits. Total pension equity credits are equal to the sum of (i) initial
pension equity credits based on the actuarial present value of the benefit
accrued as of December 31, 1998 under the plan prior to the amendment, and,
(ii) pension equity credits earned for each year of service subsequent to
January 1, 1999. At retirement, termination of employment, disability, or
death, the participant can elect to receive benefits in a single lump sum or as
an annuity (payable monthly).
8
<PAGE>
The estimated lump sum benefits payable at normal retirement age (assuming
no increase in present salary levels) to the Named Executive Officers are as
follows: Arthur C. Wiener -- $430,897; Robert McCormack -- $314,000; Charles A.
Blalock -- $298,400; Michael R. Harmon -- $303,920; John J. Hendrich --
$288,240. Actuarially equivalent annual annuity benefits will be determined at
normal retirement age based on the actuarial factors in effect at that time as
prescribed in the plan document and the Internal Revenue Code. The maximum
compensation used to calculate benefits under the plan, as permitted by law, is
$160,000 in 1999 and will be $170,000 in 2000.
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
1,000,000 87,500 175,000 262,500 350,000 437,500 525,000
1,050,000 91,875 183,750 275,625 367,500 459,375 551,250
1,100,000 96,250 192,500 288,750 385,000 481,250 577,500
1,150,000 100,625 201,250 301,875 402,500 503,125 603,750
1,200,000 105,000 210,000 315,000 420,000 525,000 630,000
</TABLE>
The average of the final five consecutive years of compensation includes
the participant's salary and bonus. The Named Executive Officers have each been
credited with approximately eleven years of service, except Mr. Heldrich, who
has been credited with approximately eight years of service. The net pension
cost for fiscal 1999 was $525,076 for approximately 38 employees 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
9
<PAGE>
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 October 2, 1999, the Named Executive Officers were eligible to
receive the following amounts in the event of involuntary termination: Arthur
C. Wiener -- $300,000; Robert McCormack -- $116,668; Charles A. Blalock --
$160,000; Michael R. Harmon -- $160,000; and Mr. Heldrich -- $187,500.
COMPENSATION OF DIRECTORS
Pursuant to the Company's Restricted Stock Plan and 1999 Stock Option Plan
each director of the Company 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 or (b) an amount of shares of Common Stock issued pursuant to the
Company's Restricted Stock Plan having an aggregate fair market value on the
date of issuance equal to $18,000, 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 1999 calendar year, (a) in
cash in the amount of $20,000, or (b) in the form of a grant of stock options
to purchase 2,500 shares of Common Stock, 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 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 1999, each of Messrs. Gillease, Holt,
Jacobs, Mapel and Sherrill were issued 4,000 shares of Common Stock under the
Restricted Stock Plan. In addition, the Company paid to each of Messrs.
Gillease, Holt, Jacobs, Mapel and Sherrill $7,160 in payment of a portion of
their income tax liability as a result of receiving such shares under the
Restricted Stock Plan. In February 1999, each of Messrs. Bradley and Thomas was
granted options to purchase 2,000 shares of Common Stock at an exercise price
of $4.50 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) Each of Mr. Bradley and Mr. Thomas was granted options in January 1999
to purchase up to 2,500 shares of Common Stock at an exercise price of $8.50
per share and (ii) Messrs. Gillease and Sherrill each received, in January
1999, a combination of $10,000 in cash and 1,765 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
currently composed of two non-employee directors (due to the retirement of Lee
Abraham as a director in November 1999) 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.
The Company is subject to Section 162(m) of the Internal Revenue Code of
1986, as amended, which limits the deductibility of certain compensation
payments to its executive officers. The Company does not have a policy
requiring the Compensation Committee to qualify all compensation for
deductibility under this provision. The Compensation Committee, however,
considers the net cost to the Company in making all compensation decisions and
will continue to evaluate the impact of this provision on its compensation
programs.
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
10
<PAGE>
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 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. 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 may 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, if any, 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 the total of 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 1999 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
11
<PAGE>
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 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 Company's option grants in the past
provided for vesting over time. During fiscal 1999, no stock options were
granted to any of the Named Executive Officers.
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
remained the same for fiscal 1999 and 1998, and increased by $50,000 for fiscal
1998 as compared to fiscal 1997. 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
Paul G. Gillease
William deR. Holt
12
<PAGE>
PERFORMANCE COMPARISON
The following graph compares, from September 30, 1994 (the last trading
day before the commencement of the Company's fifth fiscal year preceding fiscal
1999), 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 September 30, 1994 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.
[Performance chart appears here]
<TABLE>
<CAPTION>
BASE PERIOD
SEPT. 1994 SEPT. 1995 SEPT. 1996 SEPT.1997 SEPT. 1998 SEPT. 1999
<S> <C> <C> <C> <C> <C> <C>
GALEY & LARD $100.00 $67.07 $62.80 $92.07 $58.23 $12.80
S&P 500 $100.00 $129.74 $156.12 $219.27 $239.11 $305.59
PEER GROUP $100.00 $105.60 $95.19 $132.88 $83.55 $58.92
</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 October 2, 1999 did not exceed
5% of the revenues of such firm for its most recent fiscal year.
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 2000 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 1999 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
13
<PAGE>
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 30, 1999 are concurrently being
sent a copy of the Company's Annual Report for the fiscal year ended October 2,
1999 which contains audited financial statements of the Company for the fiscal
years ended September 27, 1997, October 3, 1998 and October 2, 1999.
STOCKHOLDER PROPOSALS
Stockholder proposals must be received by the Company at its principal
executive office no later than September 12, 2000 in order to be considered for
inclusion in proxy materials distributed in connection with the next annual
meeting of stockholders.
The proxy or proxies designated by the Company will have discretionary
authority to vote on any matter properly presented by a stockholder for
consideration at the next annual meeting of stockholders but not submitted for
inclusion in the proxy materials for such meeting unless notice of the matter
is received by the Company at its principal executive office not later than
November 26, 2000 and certain other conditions of the applicable rules of the
Securities and Exchange Commission are satisfied.
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 OCTOBER 2,
1999 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 10, 2000
14
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PROXY
GALEY & LORD, INC.
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON FEBRUARY 8, 2000
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
30, 1999, at the Annual Meeting of Stockholders to be held at the Company's
executive offices, 980 Avenue of the Americas, New York, New York 10018, on
February 8, 2000, 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 seven directors nominated by the Board of Directors:
[ ] FOR all nominees listed below (except as indicated below)
[ ] WITHHOLD AUTHORITY to vote for the nominees listed below
ARTHUR C. WIENER, MICHAEL T. BRADLEY, PAUL G. GILLEASE, WILLIAM DE R. HOLT,
HOWARD S. JACOBS, WILLIAM M.R. MAPEL AND STEPHEN C. SHERRILL
(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 2000 fiscal year.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Upon such other business as may properly come before the Meeting or any
adjournment thereof.
<PAGE>
(This Space Left Blank Intentionally)
- --------------------------------------------------------------------------------
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 seven named
individuals as directors, (ii) FOR the ratification of the selection of Ernst &
Young LLP as independent auditors of the Company for the 2000 fiscal year, and
(iv) 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.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting of
Stockholders to be held on February 8, 2000 and the Proxy Statement, dated
January 10, 2000, prior to the signing of this proxy.
Dated: ,2000
(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.
