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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO [ ] TRANSITION REPORT PURSUANT
SECTION13 OR 15(d) OF THE TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT SECURITIES EXCHANGE ACT OF
OF 1934 1934
(Fee Required) (No Fee Required)
For the fiscal year ended For the transition period
October 2, 1994 from ______ to _______
Commission File No. 1-6922
_________
GUILFORD MILLS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 13-1995928
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4925 West Market Street
Greensboro, North Carolina 27407
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (910) 316-4000
_________
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on which
Registered
Common Stock, $.02 par value New York Stock Exchange
6% Convertible Subordinated New York Stock Exchange
Debentures due 2012
Preferred Stock Purchase Rights New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding twelve (12)
months (or for such shorter period that the Registrant was required
to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of Registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendment to this Form 10-K.[ ]
Aggregate market value of the voting stock (which consists solely
of shares of common stock) held by non-affiliates of the Registrant
at December 19, 1994 (a total of 11,409,794 shares of common
stock), computed by reference to the last reported sale price
($20.75) of the Registrant's common stock on the New York Stock
Exchange on such date: $236,753,226.
Number of shares of the Registrant's common stock outstanding as of
December 19, 1994: 14,011,412
DOCUMENTS INCORPORATED BY REFERENCE
Certain portions of the Annual Report to Stockholders for the
fiscal year ended October 2, 1994 are incorporated by reference
into Parts I and II of this report.
Certain portions of the Registrant's definitive proxy statement
pursuant to Regulation 14A of the Securities Exchange Act of 1934,
as amended, which will be filed with the Commission subsequent to
the date hereof, are incorporated by reference into Part III of
this report.
GUILFORD MILLS, INC.
PART I
Item 1. Business
General
Guilford Mills, Inc. (the "Company") is engaged primarily in
the business of producing, processing and selling warp knit
fabrics. The Company knits synthetic yarn, primarily nylon,
acetate and polyester, on warp knitting machinery into warp knit
fabrics, which it then dyes and finishes. The Company sells its
finished fabrics for use in a broad range of apparel, automotive
and home furnishings products. The Company also designs, knits,
dyes, prints and finishes elastomeric and circular knit fabrics for
sale principally to swimwear, dress and sportswear manufacturers.
Additionally, the Company has introduced woven velour fabric
capabilities in its expanding automotive business.
On August 18, 1994, the Company purchased 55% of the
outstanding capital stock of Grupo Ambar, S.A. de C.V. and
subsidiaries ("Grupo Ambar"). The acquisition increased the
Company's ownership in Grupo Ambar to 75%. Grupo Ambar is a
leading manufacturer of knit textile fabrics in Mexico.
In 1993, the Company changed its fiscal year for financial
reporting purposes from a fiscal year ending on the Sunday nearest
to June 30 to the Sunday nearest to September 30. Accordingly,
presentation of a transition quarter beginning June 28, 1993 and
ending September 26, 1993 is made.
The Company was incorporated under the laws of Delaware in
August 1971, and is the successor by merger to businesses
previously conducted since 1946. Guilford Mills, Inc. and its
predecessors and subsidiaries are referred to as the "Company",
unless the context indicates otherwise.
Product Development
Working closely with the Company's customers, the Company's
research and development departments, consisting of 83 full-time
U.S. employees, six employees of Guilford Europe Limited, a United
Kingdom corporation and an indirect wholly-owned subsidiary of the
Company ("Guilford Europe"), and one employee of Grupo Ambar, are
primarily responsible for the creation of new fabrics and styles.
Sample warping and knitting machines are used to develop new
fabrics which can be placed into production after customer
acceptance. Total expenditures for research and development for
fiscal year 1994, the transition quarter ended September 26, 1993,
and the fiscal years 1993 and 1992 were approximately $14.7
million, $3.1 million $15.8 million, and $14.1 million,
respectively.
The Company has numerous trademarks, trade names and certain
licensing agreements which it uses in connection with the
advertising and promotion of its products. Management believes
that the loss or expiration of such trademarks, trade names and
licensing agreements would not have a material adverse effect on
the Company's operations.
Working Capital Practices
The Company primarily produces inventory based on customer
orders and significant amounts of inventory are not required to
meet rapid delivery or to assure a continuous allotment of goods
from suppliers. Customers are allowed to return goods for valid
reasons and customer accommodations are not significant.
Approximately 37% of domestic accounts receivable are factored
in order to avoid the credit risk on such accounts and to obtain
larger credit lines for many customers. The Company has the
ability to borrow against such receivables, although it has
traditionally not done so as the related borrowing terms are less
favorable than other available sources of financing. The Company
generally takes advantage of discounts offered by vendors.
Marketing
The Company sells its warp knit and circular knit fabrics for
use in a broad range of apparel, automotive and home furnishings
products. For the fiscal years ended October 2, 1994, June 27,
1993 and June 28, 1992, the approximate percentage of the Company's
worldwide sales attributable to each category was as follows:
Oct. 2, June 27, June 28,
1994 1993 1992
Apparel 51% 54% 58%
Automotive 38 33 28
Home Furnishings 8 10 12
Other 3 3 2
Total 100% 100% 100%
The Company experiences seasonal fluctuations in its sales of
apparel fabrics, with the highest sales historically occurring in
the period from January to June; however, recent trends indicating
the natural movement of the sales, based upon the needs of the
Company's customers, to the period from April to September. Sales
of fabrics for use in automotive and home furnishings products
experience insignificant seasonal fluctuations.
Reference is made to Note 11 of the Consolidated Financial
Statements in the Company's Annual Report to Stockholders for the
fiscal year ended October 2, 1994 (the "Annual Report"), which note
is incorporated herein by reference, for financial information
relating to sales, income and assets of Guilford Europe and Grupo
Ambar for the last three fiscal years and the transition quarter.
The backlog of orders believed to be firm as of the end of the
current and preceding fiscal years is not deemed to be material for
an understanding of the Company's business as most orders are
deliverable within a few months.
The Company promotes its fabrics primarily by advertising in
trade publications, in conjunction with yarn producers, and to a
lesser extent by participating in trade shows.
In the United States, the Company has sales offices in New York
City, Los Angeles, Greensboro, Detroit and Chicago. Guilford
Europe services the United Kingdom market with its own marketing
group from its Alfreton administrative offices. Export markets are
serviced by in-house personnel based in the United Kingdom, Belgium
and Germany and by commission agents in most continental European
Economic Community countries. Grupo Ambar services its Mexican
market from its administrative office.
The Company has a large number of customers. No customer
accounted for 10% or more of total net sales during fiscal 1994,
the transition quarter, or fiscal 1992. One customer, Ford Motor
Company, accounted for 13% of the total net sales of the Company
for fiscal 1993.
Export Sales
U.S. export sales, as a percentage of total worldwide sales of
the Company, constituted approximately 4% of total sales in fiscal
1994, the transition quarter, and fiscal 1993 and 5% in fiscal
1992.
Raw Materials
In the United States, the Company's warp knit fabrics are
constructed primarily of synthetic yarns: acetate, nylon,
polyester and spandex. In fiscal 1994, the Company purchased
approximately 75% of such yarns and internally produced the balance
of nylon and polyester monofilament yarns. The Company purchases
substantially all of its nylon yarn from three domestic fiber
producers and purchases substantially all of its polyester yarn
from three domestic fiber producers and one domestic texturizer.
One domestic fiber producer supplied substantially all of the
acetate yarn. The Company also uses cotton as well as synthetic
yarns in its circular knit operations. In fiscal 1994, all such
yarns were readily available and were purchased from numerous
sources.
Fabrics manufactured by Guilford Europe are made from nylon,
acetate and polyester synthetic yarns and cotton. The majority of
its polyester yarn is purchased from ten European suppliers, the
majority of its nylon and acetate yarn is purchased from five
European suppliers and its cotton yarn is purchased from one
European supplier.
Fabrics manufactured by Grupo Ambar in Mexico are made from
nylon, lycra and polyester synthetic yarn. The majority of its
polyester yarn is purchased from one Mexican, two Japanese and one
American supplier. The majority of nylon and lycra yarn is
purchased from two Mexican suppliers.
Except for certain specialty yarns, management believes that an
adequate supply of yarns is available to meet the Company's
requirements. The chemicals and dyes used in the dyeing and
finishing processes are available in large quantities from various
suppliers.
Environmental Matters
The production processes, particularly dyeing and finishing
operations, involve the use and discharge of certain chemicals and
dyes into the air and sewage disposal systems. The Company
installs pollution control devices as necessary to meet existing
and anticipated Federal, state and local pollution control
regulations. The Company, including Guilford Europe and Grupo
Ambar, does not anticipate that compliance with Federal, state,
local and other provisions which have been enacted or adopted
regulating the discharge of materials into the environment, or
otherwise relating to the protection of the environment, will have
a material adverse effect upon its capital expenditures, earnings
or competitive position.
Reference is made to Note 10 of the Consolidated Financial
Statements in the Annual Report, which note is incorporated herein
by reference, for information regarding certain other environmental
matters.
Competition
Historically, the textile industry has been both highly
competitive and cyclical in nature. The textile industry has also
been characterized by periods of
strong demand, resulting in over-expansion of production facilities, followed
by periods of over-supply. For a number of years, the domestic textile
industry has been adversely affected by imports of garments comprised of
fabrics manufactured abroad. The principal methods of competition in the
textile industry are pricing, styling and design, customer service and
quality. The weight of each competitive factor varies with the product line
involved.
In the United States, the Company's apparel business unit has
three major warp knit competitors and as many as 12 other smaller
competitors. The Company also competes with some apparel
manufacturers that have warp knit equipment to manufacture their
own fabrics. Some of these companies are divisions of large,
well-capitalized companies while others are small manufacturers.
In circular knits, the Company has three major competitors and
numerous smaller competitors. The automotive business unit has
four major competitors and several smaller competitors. Guilford
Europe competes with two warp knitters in the United Kingdom and
several in France and Italy. It also competes with many producers
of circular knit and woven fabrics. Grupo Ambar competes with four
warp knitters in Mexico.
Employees
As of December 19, 1994, the Company employed 5,410 full-time
employees worldwide. Approximately 1,425 employees (including 580
in Guilford Europe and 450 in Mexico) are represented by a
collective bargaining agreement.
Item 2. Properties
The Company currently maintains a total of twelve manufacturing
and warehousing facilities in North Carolina (four of which are
leased, including one with an option to purchase, and one of which
is subleased to an unrelated entity), one manufacturing facility in
Georgia, two manufacturing facilities in Pennsylvania and one
warehousing facility in Virginia (leased). The Company's foreign
operations based in England include two manufacturing and
warehousing facilities, one in Alfreton in Derbyshire and one in
Sudbury in Suffolk, each owned by the Company, and those based in
Mexico include one manufacturing facility and one warehouse
(leased) in Xalostoc, and four stores (leased) in the Federal
District. Management believes the facilities and manufacturing
equipment are in good condition, well maintained, suitable and
adequate for present production. Utilization of the facilities
fluctuates from time to time due to the seasonal nature of
operations and market conditions.
Item 3. Legal Proceedings
Reference is made to Note 10 of the Consolidated Financial
Statements in the Annual Report, which note is incorporated herein
by reference, for information regarding certain environmental
matters.
On or about August 10, 1993, Skylon Corporation commenced an
action in the United States District Court for the Southern
District of New York against the Company and George Greenberg, the
former president and a current director of the Company. Plaintiff
alleged that it was fraudulently induced into entering into various
agreements with the Company. Plaintiff sought an aggregate of
$31.75 million in compensatory and punitive damages. In the fourth
quarter of the 1994 fiscal year, the District Court in this action
granted the Company's summary judgment motion dismissing all of the
plaintiff's claims against the Company. The court denied such
motion with respect to Mr. Greenberg, but Mr. Greenberg has moved
to reargue such motion which the court has under consideration. As
a matter of law, in appropriate circumstances, the Company has an
obligation to indemnify Mr. Greenberg as to any liability he may
have in this matter.
Except as indicated above, the Company is not a party to any
material pending legal proceedings, other than ordinary routine
litigation incidental to its business. Although the final outcome
of these legal matters cannot be determined, based on the facts
presently known, it is management's opinion that the final
resolution of these matters will not have a material adverse effect
on the Company's financial position or future results of
operations.
Item 4A. Submission of Matters to a Vote of Security Holders
No matter was submitted to a vote of security holders during
the Company's fourth quarter.
Item 4B. Executive Officers of the Registrant (as of December 19,
1994)
Name Age Office or Business Experience
Charles A. Hayes 60 Chairman of the Board and Chief
Executive Officer (since 1976);
President and Chief Operating
Officer (since 1991); formerly
President (from 1968 to 1976) and
Executive Vice President (from
1961 to 1968).
Alfred A. Greenblatt 45 Senior Vice President (since 1989)
and President/Apparel and Home
Fashions Business Unit (since
1991); formerly President/Fashion
Apparel Fabrics Business Unit (from
1989 to 1991) and holder of various
executive positions (from 1984 to
1989).
John A. Emrich 50 Senior Vice President and President/
Automotive Business Unit (since
1993); formerly Vice President/
Planning and Vice President/
Operations for the Apparel and Home
Fashions Business Unit (from 1991 to
1993); Director of Operations with
Fab Industries, Inc. (from 1990 to
1991) and holder of various executive
positions with the Company (from 1985
to 1990).
Richard S. Roberts 65 Senior Vice President and President/
Fibers Business Unit (since 1989);
formerly Vice President/Manufacturing
(from 1987 to 1989) and Director of
Industrial Fabrics (from 1986 to
1987).
Terrence E. Geremski 47 Member of the Board of Directors
(since 1993); Vice President, Chief
Financial Officer and Treasurer
(since 1992); formerly Vice President
and Controller with Varity
Corporation (from 1989 to 1991) and
Vice President, Chief Financial
Officer, Treasurer and holder of
other executive positions with Dayton
Walther Corp. (from 1979 to 1989).
John N. Goldsworthy 46 Vice President (since 1991) and Chief
Executive Officer of Guilford Europe
(since 1990); formerly Financial
Director of Guilford Europe (from
1981 to 1990).
Phillip D. McCartney 52 Vice President/Technical Operations
(since 1989); formerly holder of
various executive positions with FAB
Industries, Inc. (from 1984 to 1989).
William R. Houser 51 Vice President/Human Resources (since
1994); formerly Vice President/Human
Resources of Baxter Diagnostics (from
1991 to 1994) and holder of other
executive positions with Baxter
Healthcare, Inc. (from 1977 to 1991).
No family relationships exist between any executive officers of the
Company.
PART II
Item 5. Market for the Registrant's Common Equity and Related
Stockholder Matters
Reference is made to the information set forth on page 21 in
the section entitled "Common Stock Market Prices and Dividends" in
the Annual Report, filed as Exhibit 13 to this report, which page
is incorporated herein by reference.
Item 6. Selected Financial Data
Reference is made to the information set forth on page 13 in
the section entitled "Selected Financial Data" in the Annual
Report, which page is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Reference is made to the information set forth on pages 14
through 20 in the section entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the
Annual Report, which pages are incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data
Reference is made to information set forth on pages 22 through
34 of the Annual Report, which pages are incorporated herein by
reference.
Item 9. Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure
None.
PART III
Item 10. Directors and Executive Officers of the Registrant
The information to be included under the captions "Directors
and Nominees" and "Additional Information" contained in the section
entitled "ELECTION OF DIRECTORS" in the Company's definitive proxy
statement, which will be filed with the Commission subsequent to
the date hereof pursuant to Regulation 14A under the Securities
Exchange Act of 1934 (the "Proxy Statement"), is incorporated
herein by reference.
Item 11. Executive Compensation
The information to be included in the section "EXECUTIVE
COMPENSATION" in the Proxy Statement is incorporated herein by
reference.
Item 12. Security Ownership of Certain Beneficial Owners and
Management
The information to be included in the section "SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT" in the Proxy
Statement is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
The information to be included in the section "CERTAIN
TRANSACTIONS" in the Proxy Statement is incorporated herein by
reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 8-K
(a) Documents filed as a part of this report:
1. Financial Statements (reference is made to pages 22 through
34 of the Annual Report, which pages are incorporated herein
by reference):
Consolidated Balance Sheets as of October 2, 1994, September
26, 1993 and June 27, 1993
Consolidated Statements of Income for the Year Ended October
2, 1994, the Transition Quarter from June 28, 1993 to
September 26, 1993, and the Years Ended June 27, 1993 and
June 28, 1992
Consolidated Statements of Stockholders' Investment for the
Year Ended October 2, 1994, the Transition Quarter from June
28, 1993 to September 26, 1993, and the Years Ended June 27,
1993 and June 28, 1992
Consolidated Statements of Cash Flows for the Year Ended
October 2, 1994, the Transition Quarter from June 28, 1993
to September 26, 1993, and the Years Ended June 27, 1993 and
June 28, 1992
Notes to Consolidated Financial Statements
Statement of Management Responsibility
Report of Independent Public Accountants
2. Financial Statement Schedules:
Schedule II - Amounts Receivable From Related Parties and
Underwriters, Promoters and Employees Other Than Related
Parties for the Year Ended October 2, 1994, the Transition
Quarter from June 28, 1993 to September 26, 1993, and the
Years Ended June 27, 1993 and June 28, 1992
Schedule V - Analysis of Property, Plant and Equipment for
the Year Ended October 2, 1994, the Transition Quarter from
June 28, 1993 to September 26, 1993, and the Years Ended
June 27, 1993 and June 28, 1992
Schedule VI - Analysis of Accumulated Depreciation for the
Year Ended October 2, 1994, the Transition Quarter from June
28, 1993 to September 26, 1993, and the Years Ended June 27,
1993 and June 28, 1992
Schedule VIII - Analysis of Valuation and Qualifying
Accounts for the Year Ended October 2, 1994, the Transition
Quarter from June 28, 1993 to September 26, 1993, and the
Years Ended June 27, 1993 and June 28, 1992
Schedule X - Supplementary Income Statement Information for
the Year Ended October 2, 1994, the Transition Quarter from
June 28, 1993 to September 26, 1993, and the Years Ended
June 27, 1993 and June 28, 1992
3. Exhibits:
Exhibit No. Description of Exhibit
(3) (a) Restated Certificate of Incorporation of the
Company, as amended through January 14, 1988
(incorporated by reference to Exhibit 3 (a) (1) to
the Company's Annual Report on Form 10-K for the
fiscal year ended July 3, 1988 (the "1988 Annual
Report")).
(3) (b) By-Laws of the Company, as amended through August
19, 1993 (incorporated by reference to Exhibit (3)
(b) to the Company's Annual Report on Form 10-K for
the fiscal year ended June 27, 1993 (the "1993
Annual Report")).
(4) (a) Promissory Note, dated September 4, 1986, issued by
the Company to The Chase Manhattan Bank (National
Association) (incorporated by reference to Exhibit
4(i) to the Company's Annual Report on Form 10-K
for the fiscal year ended June 29, 1986 (the "1986
Annual Report").
(4) (b) Indenture, dated as of March 15, 1987, between the
Company and First Union National Bank of North
Carolina, as Trustee (incorporated by reference to
Exhibit 4(a) to the Company's Registration
Statement on Form S-3 (Registration No. 33-12612)
filed with the SEC on March 13, 1987).
(4) (c) The Note Agreement, dated January 29, 1993, by and
among the Company and the purchasers named in the
purchasers' schedule attached thereto (incorporated
by reference to Exhibit 4 to the Company's Quarterly
Report on Form 10-Q for the fiscal quarter ended
December 27, 1992).
(4) (d) Rights Agreement dated as of August 23, 1990 between
the Company and The First National Bank of Boston,
as Rights Agent (incorporated by reference to
Exhibit 1 to the Company's Current Report on Form
8-K filed with the SEC on September 7, 1990).
(4) (e) The Company has an additional long-term debt
instrument which, pursuant to Item 601 (b)(4)(iii)
of Regulation S-K, will be furnished to the
Securities and Exchange Commission upon request.
(10) (a)* Guilford Mills, Inc. Non-Qualified Profit Sharing
Plan for Certain of its Executive Officers and Key
Employees, effective July 1, 1989 (incorporated by
reference to Exhibit 10 (a) (7) to the Company's
Annual Report on Form 10-K for the fiscal year
ended July 1, 1990 (the "1990 Annual Report")).
(10) (b)* Amended and Restated Incentive Stock Option
Plan-1981 (incorporated by reference to Exhibit (10)
(d) to the Company's Annual Report on Form 10-K for
the fiscal year ended June 28, 1987 (the "1987
Annual Report")).
(10) (c)* Guilford Mills, Inc. 1991 Stock Option Plan
(incorporated by reference to Exhibit 28 (a) to the
Company's Registration statement on Form S-8
(Registration No. 33-47109) filed with the SEC on
April 10, 1992 (the "Form S-8")).
(10) (d)* Form of Stock Option Contract for key employees in
the 1991 Stock Option Plan (relating to incentive
stock options) (incorporated by reference to Exhibit
28 (b) to the Form S-8).
(10) (e)* Form of Stock Option Contract for Director
participants in the 1991 Stock Option Plan
(incorporated by reference to Exhibit 28 (d) to the
Form S-8).
(10) (f)* Guilford Mills, Inc. 1989 Restricted Stock Plan
(incorporated by reference to Exhibit 10 (b) (2) to
the 1990 Annual Report).
(10) (g)* Amendment to 1989 Restricted Stock Plan.
(10) (h)* Form of Restricted Stock Agreement between the
Company and certain of its officers and key
employees pursuant to the 1989 Restricted Stock Plan
(incorporated by reference to Exhibit 10 (j) to the
Company's Annual Report on Form 10-K for the fiscal
year ended June 28, 1992 (the "1992 Annual
Report")).
(10) (i)* Form of Amendment to Restricted Stock Agreement
between the Company and certain of its officers and
key employees pursuant to the 1989 Restricted Stock
Plan (incorporated by reference to Exhibit (10) (k)
to the 1992 Annual Report).
(10) (j)* Form of Second Amendment to Restricted Stock
Agreement between the Company and certain of its
officers and key employees pursuant to the 1989
Restricted Stock Plan.
(10) (k)* Form of Third Amendment to Restricted Stock
Agreement between the Company and certain of its
officers and key employees pursuant to the 1989
Restricted Stock Plan.
(10) (l)* Form of Fourth Amendment to Restricted Stock
Agreement between the Company and certain of its
officers and key employees pursuant to the 1989
Restricted Stock Plan.
(10) (m)* Amended and Restated Phantom Stock Agreement between
the Company and Charles A. Hayes dated September 21,
1994.
(10) (n)* Retirement Agreement between the Company and Richard
S. Roberts, dated April 2, 1992 (incorporated by
reference to Exhibit (10) (n) to the 1992 Annual
Report).
(10) (o)* Form of Executive Retirement and Death Benefit
Agreements between the Company and certain of its
executive officers and key employees (incorporated
by reference to Exhibit 10 (d) (1) to the 1990
Annual Report).
(10) (p)* Form of Pension and Death Benefit Agreement between
the Company and certain of its executive officers
and key employees (incorporated by reference to
Exhibit 10 (d) (2) to the 1990 Annual Report).
(10) (q)* Form of Deferred Compensation Agreement between the
Company and certain of its officers and key
employees (incorporated by reference to Exhibit 10
(d) (3) to the 1990 Annual Report).
(10) (r)* Guilford Mills, Inc. Senior Managers' Life Insurance
Plan and related Plan Agreement (incorporated by
reference to Exhibit (10) (r) to the 1992 Annual
Report).
(10) (s)* Guilford Mills, Inc. Senior Managers' Pre-Retirement
Life Insurance Agreement (incorporated by reference
to Exhibit (10) (s) to the 1992 Annual Report).
(10) (t)* Guilford Mills, Inc. Senior Managers' Supplemental
Retirement Plan and related Plan Agreement
(incorporated by reference to Exhibit (10) (t) to
the 1992 Annual Report).
(10) (u)* Form of Severance Agreement between the Company and
certain of its officers and employees (incorporated
by reference to Exhibit (10) (u) to the 1992 Annual
Report).
(10) (v)* Form of Amendment to Severance Agreement between the
Company and certain of its officers and employees.
(10) (w)* Form of Second Amendment to Severance Agreement
between the Company and certain of its officers and
employees.
(10) (x) Stockholders' Agreement, dated as of April 30, 1991
by and among the Company, Maurice Fishman and
Charles A. Hayes (incorporated by reference to
Exhibit (10) (e) to the Company's Annual Report on
Form 10-K for the fiscal year ended June 30, 1991).
(10) (y) Amendment, dated June 29, 1994, to Stockholders'
Agreement, dated as of April 30, 1991, by and among
the Company, Maurice Fishman and Charles A. Hayes.
(10) (z) Stockholders' Agreement, dated as of June 22, 1990,
by and among the Company, Charles A. Hayes, George
Greenberg and Maurice Fishman (incorporated by
reference to Exhibit 10 (f) to the 1990 Annual
Report).
(10) (a) (a)* Short Term Incentive Compensation Plan for Key
Managers (incorporated by reference to Exhibit (10)
(x) to the 1992 Annual Report).
(10) (b) (b)* Management Compensation Trust Agreement between
the Company and North Carolina Trust Company dated
July 1, 1991 (incorporated by reference to Exhibit
(10) (y) to the 1992 Annual Report).
(10) (c) (c)* Amendment to the Management Compensation Trust
Agreement between the Company and North Carolina
Trust Company dated April 1, 1992 (incorporated by
reference to Exhibit (10) (z) to the 1992 Annual
Report).
(10) (d) (d)* Second Amendment to the Management Compensation
Trust Agreement between the Company and North
Carolina Trust Company dated July 1, 1992
(incorporated by reference to Exhibit (10) (a) (a)
to the 1992 Annual Report).
(10) (e) (e) Credit Agreement dated as of May 14, 1993 between
the Company and Wachovia Bank of North Carolina,
N.A. (incorporated by reference to Exhibit (10) (y)
to the 1993 Annual Report).
(13) Annual Report to Stockholders of the Company for the
fiscal year ended October 2, 1994 (only those portions
of such report incorporated by reference to the Annual
Report on Form 10-K are filed herewith).
(21) Subsidiaries of the Registrant.
(23) Consent of Independent Public Accountants.
(27) Financial Data Schedule
*Items denoted with an asterisk represent management contracts or
compensatory plans or arrangements.
(b) Reports on Form 8-K
Not Applicable.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
GUILFORD MILLS, INC.
By:/s/ Terrence E. Geremski
Terrence E. Geremski
Vice President, Chief Financial
Officer and Treasurer
Dated: December 30, 1994
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates
indicated.
Signature Title Date
Chairman of the
Charles A. Hayes Board of Directors
and Chief Executive
Officer (Principal
Executive Officer)
and President and
Chief Operating
Officer
/s/ Maurice Fishman Vice Chairman of the December 30, 1994
Maurice Fishman Board of Directors
Vice Chairman of the
George Greenberg Board of Directors
/s/ Terrence E. Geremski Director, Vice December 30, 1994
Terrence E. Geremski President, Chief
Financial Officer
and Treasurer
(Principal Financial
and Accounting
Officer)
/s/ Paul R. McGarr Director December 30, 1994
Paul R. McGarr
/s/ Tomokazu Adachi Director December 30, 1994
Tomokazu Adachi
/s/ Donald B. Dixon Director December 30, 1994
Donald B. Dixon
/s/ Stephen C. Hassenfelt Director December 30, 1994
Stephen C. Hassenfelt
/s/ Sherry R. Jacobs Director December 30, 1994
Sherry R. Jacobs
Director
Stig A. Kry
Director
Paul G. Gillease
INDEX TO FORM 10-K SCHEDULES
Report of Independent Public Accountants. . . . . . . . . F-1
Schedule II - Amounts Receivable From Related
Parties and Underwriters, Promoters and Employees
Other Than Related Parties for the Year Ended
October 2, 1994, the Transition Quarter from
June 28, 1993 to September 26, 1993, and the
Years Ended June 27, 1993 and June 28, 1992 . . . . . . . F-2
Schedule V - Analysis of Property, Plant and
Equipment for the Year Ended October 2, 1994,
the Transition Quarter from June 28, 1993 to
September 26, 1993, and the Years Ended
June 27, 1993 and June 28, 1992 . . . . . . . . . . . . . F-3
Schedule VI - Analysis of Accumulated Depreciation
for the Year Ended October 2, 1994, the Transition
Quarter from June 28, 1993 to September 26, 1993,
and the Years Ended June 27, 1993 and June 28, 1992 . . . F-4
Schedule VIII - Analysis of Valuation and
Qualifying Accounts for the Year Ended October 2,
1994, the Transition Quarter from June 28, 1993
to September 26, 1993, and the Years Ended
June 27, 1993 and June 28, 1992 . . . . . . . . . . . . . F-5
Schedule X - Supplementary Income Statement
Information for the Year Ended October 2, 1994,
the Transition Quarter from June 28, 1993 to
September 26, 1993, and the Years Ended
June 27, 1993 and June 28, 1992 . . . . . . . . . . . . . F-6
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Stockholders and Board of Directors of Guilford Mills, Inc.:
We have audited in accordance with generally accepted
auditing standards, the financial statements included in the
Guilford Mills, Inc. Annual Report to the Stockholders incorporated
by reference in this Form 10-K, and have issued our report thereon
dated November 16, 1994. Our audit was made for the purpose of
forming an opinion on those statements taken as a whole. The
schedules on pages F-2 through F-6 are the responsibility of the
Company's management and are presented for purposes of complying
with the Securities and Exchange Commission's rules and are not
part of the basic financial statements. These schedules have been
subjected to the auditing procedures applied in the audits of the
basic financial statements and, in our opinion, fairly state in all
material respects the financial data required to be set forth
therein in relation to the basic financial statements taken as a
whole.
ARTHUR ANDERSEN LLP
Greensboro, North Carolina,
November 16, 1994.
Guilford Mills, Inc.
SCHEDULE II
Amounts Receivable From Related Parties and Underwriters,
Promoters and Employees Other Than Related Parties
For the Year Ended October 2, 1994, the Transition Quarter
from June 28, 1993 to September 26, 1993 and the Years Ended
June 27, 1993 and June 28, 1992
(In Thousands)
Balance Balance
Beginning End of
Name of Debtor of Period Additions Deductions Period
For the Year Ended
June 28, 1992: $ - $ - $ - $ -
For the Year Ended
June 27, 1993:
Joseph M. Amdur (1) $ - $ 164 $ - $ 164
John A. Emrich (2) $ - $ 100 $ - $ 100
For the Transition
Quarter Ended
September 26, 1993:
Joseph M. Amdur (1) $ 164 $ - $ - $ 164
John A. Emrich (2) $ 100 $ - $ - $ 100
For the Year Ended
October 2, 1994:
Joseph M. Amdur (1) $ 164 $ - $ 164 $ -
John A. Emrich (2) $ 100 $ - $ - $ 100
(1) In fiscal 1993, in connection with the Company's request that
Joseph M. Amdur, presently an employee of the Company, relocate
to Greensboro, N.C., the Company loaned Mr. Amdur $164 to
purchase a residence. The loan, secured by a first Deed of
Trust on the residence purchased by Mr. Amdur, was repaid on
October 21, 1993.
(2) In fiscal 1993, in connection with the Company's request that
John A. Emrich, presently an officer of the Company, relocate
to Wilmington, N.C., the Company loaned Mr. Emrich $100 to
purchase a residence. The loan is payable on demand and is
secured by a second Deed of Trust on the residence purchased by
Mr. Emrich.
(3) See Notes to Consolidated Financial Statements.
Guilford Mills, Inc
SCHEDULE V
Analysis of Property, Plant and Equipment
For the Year Ended October 2, 1994, the Transition Quarter
from June 28, 1993 to September 26, 1993, and the Years Ended
June 27, 1993 and June 28, 1992
(In Thousands)
Balance Balance
Beginning Additions End of
of Period at Cost Retirements Other Period
(1)
For the Year Ended
June 28, 1992:
Land and improvements $ 5,763 $ 197 $ --- $ 136 $ 6,096
Buildings and improvements 49,521 1,516 (4,493) 529 47,073
Machinery and equipment 248,578 40,997 (10,788) 4,872 283,659
Construction in progress 12,820 (6,947) --- --- 5,873
$316,682 $ 35,763 $(15,281) $ 5,537 $342,701
For the Year Ended
June 27, 1993:
Land and improvements $ 6,096 $ 789 $ (574) $ (181) $ 6,130
Buildings and improvements 47,073 12,522 (1,145) (1,388) 57,062
Machinery and equipment 283,659 51,038 (14,949) (8,810) 310,938
Construction in progress 5,873 37,825 --- --- 43,698
$342,701 $102,174 $(16,668) $(10,379) $417,828
For the Transition Quarter
Ended September 26, 1993:
Land and improvements $ 6,130 $ 1,601 $ --- $ 10 $ 7,741
Buildings and improvements 57,062 6,152 (692) 185 62,707
Machinery and equipment 310,938 18,008 (568) 282 328,660
Construction in progress 43,698 (1,943) --- --- 41,755
$417,828 $ 23,818 $ (1,260) $ 477 $440,863
For the Year Ended
October 2, 1994:
Land and improvements $ 7,741 $ 409 $ --- $ 3,433 $ 11,583
Buildings and improvements 62,707 14,036 (1,335) 10,394 85,802
Machinery and equipment 328,660 70,467 (6,415) 22,952 415,664
Construction in progress 41,755 (37,201) --- 3 4,557
$440,863 $ 47,711 $ (7,750) $ 36,782 $517,606
(1) Other amounts represent the effect of exchange rate
fluctuations and the property, plant and equipment
balances of acquired subsidiaries as of the date of
acquisition.
(2) Maintenance and repairs are charged to income; renewals and
betterments are capitalized. Upon disposition of an item, the
cost and accumulated depreciation are removed from the accounts
and the resulting gain or loss is included in income.
(3) See Notes to Consolidated Financial Statements.
Guilford Mills, Inc.
SCHEDULE VI
Analysis of Accumulated Depreciation
For the Year Ended October 2, 1994, the Transition Quarter
from June 28, 1993 to September 26, 1993, and the Years
Ended June 27, 1993 and June 28, 1992
(In Thousands)
Additions
Balance Charged to Balance
Beginning Cost and End of
of Period Expenses Retirements Other Period
(2)
For the Year Ended
June 28, 1992:
Land improvements $ 506 $ 50 $ -- $ -- $ 556
Buildings and improvements 19,458 2,653 (301) 200 22,010
Machinery and equipment 162,876 23,994 (6,478) 2,777 183,169
$182,840 $26,697 $ (6,779) $ 2,977 $205,735
For the Year Ended
June 27, 1993:
Land improvements $ 556 $ 44 $ (9) $ -- $ 591
Buildings and improvements 22,010 2,308 (150) (406) 23,762
Machinery and equipment 183,169 25,021 (15,065) (4,598) 188,527
$205,735 $27,373 $(15,224) $(5,004) $212,880
For the Transition Quarter
Ended September 26, 1993:
Land improvements $ 591 $ -- $ -- $ -- $ 591
Buildings and improvements 23,762 691 -- 31 24,484
Machinery and equipment 188,527 7,814 (962) 445 195,824
$212,880 $ 8,505 $ (962) $ 476 $220,899
For the Year Ended
October 2, 1994:
Land improvements $ 591 $ 76 $ -- $ 8 $ 675
Buildings and improvements 24,484 3,024 -- 4,112 31,620
Machinery and equipment 195,824 36,249 (3,238) 13,966 242,801
$220,899 $39,349 $ (3,238) $18,086 $275,096
(1) Depreciable lives range from 5 to 20 years for land
improvements, 10 to 35 years for buildings and 5 to 8
years for machinery and equipment.
(2) Other amounts represent the effect of exchange rate
fluctuations and the property, plant and equipment
balances of acquired subsidiaries as of the date of
acquisition.
(3) See Notes to Consolidated Financial Statements.
Guilford Mills, Inc.
SCHEDULE VIII
Analysis of Valuation and Qualifying Accounts
For the Year Ended October 2, 1994, the Transition Quarter
from June 28, 1993 to September 26, 1993, and the Years
Ended June 27, 1993 and June 28, 1992
(In Thousands)
Additions
Balance Charged to Balance
Beginning Cost and End of
of Period Expenses Deductions Other Period
(1) (2)
For the Year Ended
June 28, 1992:
Reserve deducted from assets
to which it applies -
Allowance for doubtful
accounts $5,995 $1,566 $(2,081) $ 284 $5,764
For the Year Ended
June 27, 1993:
Reserve deducted from assets
to which it applies -
Allowance for doubtful
accounts $5,764 $2,994 $ (21) $ (159) $8,578
For the Transition Quarter
Ended September 26, 1993:
Reserve deducted from assets
to which it applies -
Allowance for doubtful
accounts $8,578 $ - $ (1) $ (171) $8,748
For the Year Ended
October 2, 1994:
Reserve deducted from assets
to which it applies -
Allowance for doubtful
accounts $8,748 $1,334 $(1,719) $ 182 $8,545
(1) Deductions are for the purpose for which the reserve was
created.
(2) Other amounts represent the effect of exchange rate
fluctuations.
(3) See Notes to Consolidated Financial Statements.
Guilford Mills, Inc.
SCHEDULE X
Supplementary Income Statement Information
For the Year Ended October 2, 1994, the Transition Quarter
from June 28, 1993 to September 26, 1993, and the Years
Ended June 27, 1993 and June 28, 1992
(In Thousands)
October 2, September 26, June 27, June 28,
1994 1993 1993 1992
Maintenance and repairs $24,618 $5,981 $20,769 $20,182
(1) Royalties, advertising costs, taxes (other than payroll and
income taxes) and amortization of intangible assets are not
material, as defined by Regulation S-X.
(2) See Notes to Consolidated Financial Statements.
Exhibit Index
Exhibit No. Description of Exhibit
(3) (a) Restated Certificate of Incorporation of the
Company, as amended through January 14, 1988
(incorporated by reference to Exhibit 3 (a) (1) to
the Company's Annual Report on Form 10-K for the
fiscal year ended July 3, 1988 (the "1988 Annual
Report")).
(3) (b) By-Laws of the Company, as amended through August
19, 1993 (incorporated by reference to Exhibit (3)
(b) to the Company's Annual Report on Form 10-K for
the fiscal year ended June 27, 1993 (the "1993
Annual Report")).
(4) (a) Promissory Note, dated September 4, 1986, issued by
the Company to The Chase Manhattan Bank (National
Association) (incorporated by reference to Exhibit
4(i) to the Company's Annual Report on Form 10-K
for the fiscal year ended June 29, 1986 (the "1986
Annual Report").
(4) (b) Indenture, dated as of March 15, 1987, between the
Company and First Union National Bank of North
Carolina, as Trustee (incorporated by reference to
Exhibit 4(a) to the Company's Registration
Statement on Form S-3 (Registration No. 33-12612)
filed with the SEC on March 13, 1987).
(4) (c) The Note Agreement, dated January 29, 1993, by and
among the Company and the purchasers named in the
purchasers' schedule attached thereto (incorporated
by reference to Exhibit 4 to the Company's Quarterly
Report on Form 10-Q for the fiscal quarter ended
December 27, 1992).
(4) (d) Rights Agreement dated as of August 23, 1990 between
the Company and The First National Bank of Boston,
as Rights Agent (incorporated by reference to
Exhibit 1 to the Company's Current Report on Form
8-K filed with the SEC on September 7, 1990).
(4) (e) The Company has an additional long-term debt
instrument which, pursuant to Item 601 (b)(4)(iii)
of Regulation S-K, will be furnished to the
Securities and Exchange Commission upon request.
(10) (a)* Guilford Mills, Inc. Non-Qualified Profit Sharing
Plan for Certain of its Executive Officers and Key
Employees, effective July 1, 1989 (incorporated by
reference to Exhibit 10 (a) (7) to the Company's
Annual Report on Form 10-K for the fiscal year
ended July 1, 1990 (the "1990 Annual Report")).
(10) (b)* Amended and Restated Incentive Stock Option
Plan-1981 (incorporated by reference to Exhibit (10)
(d) to the Company's Annual Report on Form 10-K for
the fiscal year ended June 28, 1987 (the "1987
Annual Report")).
(10) (c)* Guilford Mills, Inc. 1991 Stock Option Plan
(incorporated by reference to Exhibit 28 (a) to the
Company's Registration statement on Form S-8
(Registration No. 33-47109) filed with the SEC on
April 10, 1992 (the "Form S-8")).
(10) (d)* Form of Stock Option Contract for key employees in
the 1991 Stock Option Plan (relating to incentive
stock options) (incorporated by reference to Exhibit
28 (b) to the Form S-8).
(10) (e)* Form of Stock Option Contract for Director
participants in the 1991 Stock Option Plan
(incorporated by reference to Exhibit 28 (d) to the
Form S-8).
(10) (f)* Guilford Mills, Inc. 1989 Restricted Stock Plan
(incorporated by reference to Exhibit 10 (b) (2) to
the 1990 Annual Report).
(10) (g)* Amendment to 1989 Restricted Stock Plan.
(10) (h)* Form of Restricted Stock Agreement between the
Company and certain of its officers and key
employees pursuant to the 1989 Restricted Stock Plan
(incorporated by reference to Exhibit 10 (j) to the
Company's Annual Report on Form 10-K for the fiscal
year ended June 28, 1992 (the "1992 Annual
Report")).
(10) (i)* Form of Amendment to Restricted Stock Agreement
between the Company and certain of its officers and
key employees pursuant to the 1989 Restricted Stock
Plan (incorporated by reference to Exhibit (10) (k)
to the 1992 Annual Report).
(10) (j)* Form of Second Amendment to Restricted Stock
Agreement between the Company and certain of its
officers and key employees pursuant to the 1989
Restricted Stock Plan.
(10) (k)* Form of Third Amendment to Restricted Stock
Agreement between the Company and certain of its
officers and key employees pursuant to the 1989
Restricted Stock Plan.
(10) (l)* Form of Fourth Amendment to Restricted Stock
Agreement between the Company and certain of its
officers and key employees pursuant to the 1989
Restricted Stock Plan.
(10) (m)* Amended and Restated Phantom Stock Agreement between
the Company and Charles A. Hayes dated September 21,
1994.
(10) (n)* Retirement Agreement between the Company and Richard
S. Roberts, dated April 2, 1992 (incorporated by
reference to Exhibit (10) (n) to the 1992 Annual
Report).
(10) (o)* Form of Executive Retirement and Death Benefit
Agreements between the Company and certain of its
executive officers and key employees (incorporated
by reference to Exhibit 10 (d) (1) to the 1990
Annual Report).
(10) (p)* Form of Pension and Death Benefit Agreement between
the Company and certain of its executive officers
and key employees (incorporated by reference to
Exhibit 10 (d) (2) to the 1990 Annual Report).
(10) (q)* Form of Deferred Compensation Agreement between the
Company and certain of its officers and key
employees (incorporated by reference to Exhibit 10
(d) (3) to the 1990 Annual Report).
(10) (r)* Guilford Mills, Inc. Senior Managers' Life Insurance
Plan and related Plan Agreement (incorporated by
reference to Exhibit (10) (r) to the 1992 Annual
Report).
(10) (s)* Guilford Mills, Inc. Senior Managers' Pre-Retirement
Life Insurance Agreement (incorporated by reference
to Exhibit (10) (s) to the 1992 Annual Report).
(10) (t)* Guilford Mills, Inc. Senior Managers' Supplemental
Retirement Plan and related Plan Agreement
(incorporated by reference to Exhibit (10) (t) to
the 1992 Annual Report).
(10) (u)* Form of Severance Agreement between the Company and
certain of its officers and employees (incorporated
by reference to Exhibit (10) (u) to the 1992 Annual
Report).
(10) (v)* Form of Amendment to Severance Agreement between the
Company and certain of its officers and employees.
(10) (w)* Form of Second Amendment to Severance Agreement
between the Company and certain of its officers and
employees.
(10) (x) Stockholders' Agreement, dated as of April 30, 1991
by and among the Company, Maurice Fishman and
Charles A. Hayes (incorporated by reference to
Exhibit (10) (e) to the Company's Annual Report on
Form 10-K for the fiscal year ended June 30, 1991).
(10) (y) Amendment, dated June 29, 1994, to Stockholders'
Agreement, dated as of April 30, 1991, by and among
the Company, Maurice Fishman and Charles A. Hayes.
(10) (z) Stockholders' Agreement, dated as of June 22, 1990,
by and among the Company, Charles A. Hayes, George
Greenberg and Maurice Fishman (incorporated by
reference to Exhibit 10 (f) to the 1990 Annual
Report).
(10) (a) (a)* Short Term Incentive Compensation Plan for Key
Managers (incorporated by reference to Exhibit (10)
(x) to the 1992 Annual Report).
(10) (b) (b)* Management Compensation Trust Agreement between
the Company and North Carolina Trust Company dated
July 1, 1991 (incorporated by reference to Exhibit
(10) (y) to the 1992 Annual Report).
(10) (c) (c)* Amendment to the Management Compensation Trust
Agreement between the Company and North Carolina
Trust Company dated April 1, 1992 (incorporated by
reference to Exhibit (10) (z) to the 1992 Annual
Report).
(10) (d) (d)* Second Amendment to the Management Compensation
Trust Agreement between the Company and North
Carolina Trust Company dated July 1, 1992
(incorporated by reference to Exhibit (10) (a) (a)
to the 1992 Annual Report).
(10) (e) (e) Credit Agreement dated as of May 14, 1993 between
the Company and Wachovia Bank of North Carolina,
N.A. (incorporated by reference to Exhibit (10) (y)
to the 1993 Annual Report).
(13) Annual Report to Stockholders of the Company for the
fiscal year ended October 2, 1994 (only those portions
of such report incorporated by reference to the Annual
Report on Form 10-K are filed herewith).
(21) Subsidiaries of the Registrant.
(23) Consent of Independent Public Accountants.
(27) Financial Data Schedule
*Items denoted with an asterisk represent management contracts or
compensatory plans or arrangements.