UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 28, 1996
Commission file number 1-10984
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BURLINGTON INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 56-1584586
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(State of incorporation) ( I.R.S. Employer
Identification No.)
3330 West Friendly Avenue
Greensboro, N.C. 27410
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (910) 379-2000
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Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
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Common Stock, New York Stock Exchange
par value $.01 per share Pacific 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 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. [ X ]
As of December 3, 1996, the aggregate market value of Registrant's voting stock
held of record by nonaffiliates of Registrant was approximately $642,916,730
(based upon the closing composite price on the New York Stock Exchange on that
date), excluding Treasury shares and, without acknowledging affiliate status,
856,903 shares held beneficially by Directors and executive officers as a group.
As of December 3, 1996, there were outstanding 56,161,568 shares of Registrant's
Common Stock, par value $.01 per share, and 6,909,008 shares of Registrant's
Nonvoting Common Stock, par value $.01 per share.
Documents Incorporated by Reference
Portions of Registrant's 1996 Annual Report to Shareholders are incorporated by
reference into Parts I, II and IV hereof.
Portions of Registrant's Proxy Statement dated December 16, 1996 in connection
with its Annual Meeting of Stockholders to be held on February 6, 1997 are
incorporated by reference into Part III hereof.
PART I
Item 1. Business
General
The Corporation is one of the world's largest and most diversified
manufacturers of textile products. It is a leading developer, marketer and
manufacturer of fabrics and other textile products used in a wide variety of
apparel and interior furnishings end uses. The Corporation operates in two
principal industry segments, products for apparel markets and products for
interior furnishings markets. Each of its divisions and subsidiaries essentially
functions as a stand-alone merchandising and manufacturing operation.
As of September 28, 1996, the Corporation operated 39 U.S.
manufacturing plants in eight states and three manufacturing plants in Mexico
and employed approximately 21,000 persons.
References herein to the "Corporation" mean Burlington Industries,
Inc. ("Burlington") and its subsidiaries.
Products for Apparel Markets
The Corporation serves the apparel market through five divisions,
each of which manufactures a distinct product line in terms of end uses.
Wool worsted and worsted blend fabrics. The Corporation's Menswear
division is the leading domestic manufacturer of woven wool worsted and worsted
blend fabrics supplied to manufacturers of men's and women's apparel as well as
to major clothing retailers. The division's line of innovative fashion fabrics
has been expanded in recent years to also include high value-added nonwool
fabrics. Products made with the division's fabrics are sold to the better,
moderate, and designer segments of men's and women's apparel. The division also
sells fabrics to manufacturers of better career and public service apparel and
military dress uniforms.
The division's sales are directed by five business units. Men's
Suiting constitutes the majority of sales and is focused on the moderate, better
and designer suit customers, both at the manufacturer and retail level. Men's
Sportswear has been repositioned during the past year to take advantage of the
consumer casualization trend. Coordinate sportswear and innovative products for
slacks, blazers and sportscoats are the focus of this unit. Womenswear provides
innovative worsted wool, wool blends and high value-added nonwool fabrics in
customized colors to the makers of branded womenswear. Private Label markets the
division's fabrics to retailers in both menswear and womenswear. These retailer
and store labels encompass all division products and market categories. The
division's Raeford group markets wool worsted and worsted blend fabrics to
manufacturers of a variety of career and uniform apparel, including apparel for
airlines, banks, school bands, governmental agencies and military and law
enforcement personnel.
Woven synthetic fabrics. The Corporation's Burlington Klopman
Fabrics division is a leading manufacturer of woven synthetic fabrics made with
100% polyester, 100% nylon and polyester blended with wool, rayon or other
fibers that are supplied to manufacturers of a wide variety of apparel,
activewear, interior furnishings, medical and industrial products.
The division produces lightweight polyester and polyester blend
fabrics and 100% nylon fabrics for men's, women's and children's wear sold in a
variety of price ranges, for high performance sportswear and activewear and for
a variety of other apparel, medical, interior furnishings and industrial uses.
The division also produces heavyweight polyester fabrics for use in the
manufacture of slacks, suits, skirts and sport coats as well as in the
manufacture of military and law enforcement uniforms.
The division is a leading manufacturer of waterproof, water
repellent, breathable and other coated synthetic fabrics used by makers of
outerwear and high performance sportswear and activewear. A number of its
products, including its Ultrex(R) line of breathable, water repellent fabrics,
are used in leading brands of skiwear and other activewear and by suppliers to
leading activewear retailers. The division recently introduced a new family of
composite fabrics for the outdoor activewear market.
The division's fabrics for the interior furnishings markets are
used by makers of upholstered furniture, bedspreads, draperies and other window
coverings and wallcoverings. The division's fabrics include flame retardant
fabrics used in commercial and residential furnishings.
The division also markets lightweight, reusable, protective
barrier fabrics under the Maxima(R) brand name to makers of, among other things,
clothing worn by hospital personnel and by industrial workers who are required
to work in clean and static-free environments.
The division is a leader in developing new applications and end
uses for synthetic fibers. In addition to its Ultrex(R) fabrics, the division
has continued to develop a number of fabrics made with microdenier filament
yarn, a yarn made from fiber that is thinner than silk. These products combine a
natural appearance and touch with the performance characteristics of synthetic
fibers. The Corporation's microdenier fabrics are currently being used in men's
and women's apparel fabrics, activewear, protective medical clothing and in home
furnishings. The Corporation is the leading domestic producer of microdenier
fabrics made from 100% polyester and polyester blended with wool or rayon.
Denim fabrics. The Denim division is the leading manufacturer of
fashion, value-added, specialty denim fabrics in the United States. It produces
innovative denim in a wide range of styles reflecting a variety of textures,
colors and fabric constructions. The division also produces a diversified line
of basic heavyweight, indigo-dyed denim fabrics for the jean market.
The division is a major supplier to all segments of the branded,
designer and private label jean markets. It also supplies specialty products to
sportswear and jean related manufacturers. The division also produces denim
garments made from the division's fabric for its denim customers.
The Corporation has entered into a joint venture with Mafatlal
Industries Limited to manufacture denim in India for Asian, Middle Eastern and
European markets. Production is scheduled to begin in mid-1997.
Cotton fabrics. In 1996, the Corporation formed a new business
unit, Burlington Sportswear, to produce 100% cotton and cotton/polyester blend
woven and knitted fabrics. Burlington Sportswear's products will serve the
better men's sportswear and uniform markets. The division will also arrange for
production of finished garments for its customers using the Corporation's
fabrics.
In 1996, the Corporation closed its Knitted Fabrics division,
which had experienced difficulties for a number of years. (Reference is made to
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and Note B to the Notes to Consolidated Financial Statements in the
Corporation's 1996 Annual Report to Shareholders, which is incorporated herein
by reference, for information concerning the closing of the Knitted Fabrics
division.) Certain assets of this division have been transferred to the
Burlington Sportswear division to provide the manufacturing capabilities of that
division.
Synthetic yarn. The Burlington Madison Yarn Company division is
the only major manufacturer and marketer of both filament and spun synthetic
yarns in the United States. The division believes that its ability to produce
both types of synthetic yarn is an important competitive advantage because a
significant number of its customers require the different end-product
characteristics offered by these two types of synthetic yarns. While a portion
of the division's products are used by other divisions of the Corporation, the
majority is marketed to more than 300 unaffiliated customers in the apparel,
technical, medical products and home furnishings markets.
Mexican operations. In Mexico, the Corporation manufactures woven
fabrics for apparel which are marketed principally in the local market. The
Company recently announced that it will begin construction of facilities in
Mexico for its Menswear and Denim divisions.
Products for Interior Furnishings Markets
In the interior furnishings market, the Corporation operates four
businesses, one of which focuses on interior furnishings products and decorative
fabrics and three of which serve distinct segments of the carpet and rug
markets.
Interior furnishings fabrics and products. The Burlington House
division is a leading manufacturer of ready-made and made-to-measure draperies,
window coverings and coordinating bedroom ensembles, mattress ticking,
upholstery fabrics, and decorative fabrics for use by makers of bedroom
ensembles, draperies and window coverings.
The Burlington House division's product lines consist of:
o ready-made and made-to-measure draperies, window coverings,
vertical blinds, coordinating bedroom ensembles, table linens
and throws. These finished products are sold under the
Burlington House(R) name to department and specialty stores,
under the Burlington House American Lifestyle(TM) name to
discount stores and on a private label basis to several major
retailers.
o woven jacquard mattress ticking (primarily damasks).
Burlington House is the leading manufacturer of jacquard
mattress ticking supplied to domestic manufacturers of
mattresses. Mattress ticking is the exterior fabric surface of
a finished mattress. The Corporation believes that it produces
the widest variety of ticking patterns of any domestic
manufacturer. Burlington House sells mattress ticking to all
major domestic manufacturers of mattresses for both the
residential and institutional markets.
o woven jacquard and textured fabrics for residential
upholstered furniture. Upholstery fabrics are marketed to a
broad range of furniture manufacturers.
o woven jacquard and other decorative fabrics used by
manufacturers of bedroom ensembles, comforters, draperies and
window coverings.
Carpets. The Lees division is a leading domestic manufacturer of
tufted synthetic carpet and carpet tiles for commercial uses and a manufacturer
of tufted synthetic carpet for residential use.
The division markets and sells a wide variety of standard and
custom commercial carpet products under the Corporation's Lees(R) brand name
primarily for use in offices, institutions, airports, hotels, schools, and
health care facilities. The Corporation's commercial carpet products are sold in
the middle to high priced segments of the commercial carpet market, and are
marketed through dealers primarily to architects, designers and commercial
builders, as well as directly to end users.
The division also manufactures tufted synthetic carpet for
residential use. The division markets its residential carpet products primarily
under the Lees(R) brand name and competes with a large number of domestic and
Canadian manufacturers in the middle to upper middle price ranges of the
residential carpet market. The division is also a supplier of private label
carpets to major retail chains.
The division developed and patented a yarn dyeing process that
permits it to produce carpeting that resists staining and fading on a permanent
basis. Products incorporating this dyeing technology, which are marketed under
the Duracolor(R) name in the commercial market and the Lees For Life(R) name in
the residential market, represent a major portion of the current carpet sales of
the division. The division also has developed and markets a proprietary
thermoplastic carpet backing process for commercial carpets, known as
Unibond(R), which enhances the carpet's durability.
The division's yarn dyeing capability allows it to offer carpeting
in a wide range of colors. Through its Colorfax(R) program, the division offers
customers the ability to order sample yardage manufactured to their exact color
specifications. Such samples are generally deliverable within 72 hours after the
division's receipt of specifications.
Area rugs. The Burlington House Area Rugs division is the leading
producer in the United States of tufted area and bath rugs for home use
primarily under the Burlington House American Lifestyle(TM) label. The
division's customers are major retail chains.
Accent rugs. Burlington acquired The Bacova Guild, Ltd., a leading
producer of printed accent rugs and welcome mats, in fiscal year 1995. Bacova
markets these products, in addition to fully coordinated bath ensembles, to
diverse market segments that include the leading U.S. department stores, mail
order catalogs, mass merchants, specialty stores and international customers.
Mexican operations. The Corporation manufactures residential and
commercial carpeting and fabrics for home furnishings in Mexico.
Financial Information Concerning Industry Segments and Other Matters
Reference is made to Note P to the Notes to Consolidated Financial
Statements in the Corporation's 1996 Annual Report to Shareholders, which is
incorporated herein by reference, for information concerning industry segments
for the Corporation's 1996, 1995 and 1994 fiscal years.
As part of the Corporation's strategy to divest non-core assets,
during fiscal year 1996 the Corporation disposed of J. G. Furniture, an office
furniture business, as well as interests in certain real estate and furniture
intermediary product businesses. In addition, in November 1996 the Corporation
sold its subsidiary, Advanced Textiles, Inc. ("ATI"), for $7,896,500, payable
$600,000 in cash and the balance by a seven-year convertible, promissory note
bearing interest at 9.5% per annum, the maturity of which is subject to
acceleration if certain events occur. ATI engages in the business of
manufacturing fiber glass products.
Exports
The Corporation's exports have increased to 9.8% of revenues in
fiscal year 1996, with export sales of $213 million. The Corporation's export
sales were $161 million in fiscal year 1995 and $131 million in fiscal year
1994.
Operations
The Corporation's domestic operations are organized primarily by
product category and, except in the case of the Corporation's yarn operations,
interdivisional sales are minimal. Each is essentially a stand-alone
merchandising and manufacturing operation. Products are distributed through
direct sales by divisional personnel, except in a few cases, mainly export
sales, where products are sold through independent agents or distributors.
The Corporation's corporate headquarters, principal sales and
merchandising offices and principal staff operations are located in Greensboro,
North Carolina. The Corporation maintains a major domestic sales and
merchandising office in New York City and sales offices in other major cities in
the United States.
Internationally, the Corporation has manufactured woven fabrics
for apparel, fabrics for home furnishings and carpet in Mexico for over 50 years
through wholly owned subsidiaries. The products of the Mexican operations are
sold in Mexico, either by subsidiary personnel or by agents or distributors, and
are also exported to the United States and other countries.
Manufacturing
The Corporation is a vertically integrated manufacturer.
Generally, raw fibers are purchased and spun into yarn, or filament yarns are
purchased and processed. Yarns, after dyeing in some cases, are woven, knitted
or tufted into fabric. Fabric is then sold either in dyed and finished form, as
greige (unfinished) goods or processed into finished apparel products.
Residential and commercial interior furnishings products are further processed
and packaged for sale by retailers.
"Just-in-time" manufacturing techniques, which reduce in-process
inventories, floor space requirements and the time required to process a
particular order, are used in most facilities. Programs to link customers and
suppliers of the Corporation by means of electronic data transmission are also
in place in most divisions. These programs improve efficiency and reduce lead
times by improving communication, planning and processing times at the various
stages of production. They also assist the Corporation in working effectively
with manufacturers to coordinate their operations with the demands of retailers
and, as such, are an important part of the domestic textile industry's "Quick
Response" program designed to improve its competitive position vis-a-vis
imports. Raw Materials
The Corporation uses many types of fiber, both natural (wool,
cotton, rayon and Tencel(R)) and man-made (polyester, nylon, polypropylene,
acrylic and acetate), in the manufacture of its textile products. Total raw
material costs were 33.8% of net sales in the 1996 fiscal year, 34.1% of net
sales in the 1995 fiscal year and 30.2% of net sales in the 1994 fiscal year.
(Reference is made to "Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations" for information concerning the impact of
price increases of the Corporation's key raw materials in fiscal year 1995.) The
Corporation believes that future price levels for all fibers will depend
primarily upon supply and demand conditions, general inflation, U. S. and
foreign government fiscal policies and agricultural programs and prices of
underlying raw materials such as petroleum.
Generally, the Corporation has had no difficulty in obtaining raw
materials. Wool and man-made fibers are available from a wide variety of sources
both domestically and abroad. Cotton is available from a wide variety of
domestic sources. Other materials, such as dyes and chemicals, are generally
available, but, as in the case of raw materials, continued availability is
dependent to varying degrees upon the adequacy of petroleum supplies. The
Corporation purchases essentially all its raw materials and dyes.
Research and Development
Textile manufacturers generally focus their research and
development efforts on product development rather than basic research. Major
innovations in the textile industry have come primarily from fiber producers
(microdenier fiber, for example) or machinery manufacturers (shuttleless looms).
While breakthroughs by textile manufacturers in fabric development have occurred
(for example, the Corporation's Duracolor(R) carpets using stain-resistant
technology), generally, textile makers have enhanced their competitiveness
through continual development and refinement of products to meet or create new
consumer needs (for example, the Corporation's use of microdenier fibers in a
wide range of apparel and other applications). Accordingly, with few exceptions,
basic research and development expenditures have not been as significant a
component of textile manufacturing success as expenditures on design innovation
or capability and on capital equipment that increase the range of end products
and enhance productivity.
Basic research and development responsibility for particular
product areas is located in the divisions, where process and product development
efforts focus on the specific needs of that division. Total expenditures for
research, product development, productivity enhancements, enhanced styling and
market samples aggregated $62.3 million in the 1996 fiscal year, $67.4 million
in the 1995 fiscal year and $68.3 million in the 1994 fiscal year. Included in
these amounts are research and development expenditures, which totaled $13.5
million in the 1996 fiscal year ($10.0 million in the apparel products segment
and $3.5 million in the interior furnishings products segment), compared with
$17.1 million and $18.9 million in the 1995 and 1994 fiscal years, respectively.
Trademarks and Patents
The Corporation owns all trademarks and tradenames that it
believes are material to the operation of its business. The Corporation markets
its products under a variety of trademarks and tradenames, principally utilizing
variations of the Burlington(R) name. Certain products are marketed under
nationally-recognized names such as Lees(R) for carpets and Klopman(R) for
fabrics.
From time to time, the Corporation's product development efforts
have resulted in new processes or products, some of which have been patented.
Examples of Burlington-developed technology include the patented Ultrex(R)
waterproof breathable woven fabric used in activewear and barrier fabrics and
Duracolor(R) and Lees For Life(R) carpets, manufactured using stain-resistant
technology with respect to which the Corporation has obtained patents. Because
the Corporation's business is not dependent to any significant degree upon
patents and licenses (with the possible exception of the patented stain
resistant carpet technology in the case of the interior furnishings segment),
the loss of any patents or licenses now held by the Corporation would not have a
material adverse effect upon its business or results of operations.
The Corporation derives licensing income (approximately $3.3
million in the 1996 fiscal year) from licenses of the Corporation's technology
and from licenses of the Burlington(R) name, principally to manufacturers of
socks and hosiery products in the United States and Europe.
Competition
The domestic textile industry is highly competitive. No one firm
dominates the United States market and many companies compete only in limited
segments of the textile market. Certain of the Corporation's products also
compete with nontextile products. Textile competition is based in varying
degrees on price, product styling and differentiation, quality and customer
service. The importance of each of these factors depends upon the needs of
particular customers and the degree of fashion risk inherent in the product.
Imports of foreign-made textile and apparel products are a
significant source of competition for many sectors of the domestic textile
industry. The U.S. Government has attempted to regulate the growth of certain
textile and apparel imports through tariffs and bilateral agreements which
establish quotas on imports from lesser developed countries that historically
account for significant shares of U.S. imports. Despite these efforts, imported
apparel and apparel textile fabrics, which represent the area of heaviest import
penetration, represent in excess of 60% of the U.S. market, up from less than
approximately 24% in 1975.
U.S. retailers' and apparel manufacturers' sourcing decisions are
affected by factors often beyond their control, such as changing relative labor
and raw material costs, lead times, political instability and infrastructure
deficiencies of newly industrializing countries, fluctuating currency exchange
rates, individual government policies and international agreements regarding
textile and apparel trade. As evidence of the impact of these factors, sourcing
of textile and apparel imports for goods shipped into the United States -- once
dominated primarily by Hong Kong, Taiwan and Korea -- has been shifting to other
lower-cost producer countries such as The People's Republic of China, Thailand,
Malaysia, the Philippines, Mexico and countries in the Caribbean Basin. The
Corporation believes that changing cost structures, delivery lead times,
political uncertainty and infrastructure deficiencies associated with many of
these producers have caused importers to reassess the degree of reliance placed
upon certain of these sources, and to reconsider the importance of the
reliability of domestic manufacturing sources. In addition to these factors, the
U.S. Government's policies designed to benefit Mexico and the Caribbean Basin,
through favored quota and tariff treatment, have accelerated the shift in
production of garments away from Far East sources, indirectly benefiting U.S.
textile producers. The U.S. "807" tariff program, in particular, has grown
significantly in the last five years, benefiting U.S. textile producers whose
fabrics are incorporated into garments assembled in Caribbean countries before
returning to U.S. markets, where duty is charged upon only the value added in
assembling the garments.
Under the North American Free Trade Agreement ("NAFTA") with
Mexico and Canada, there are no textile/apparel quotas between the United States
and either Mexico or Canada for products which meet certain origin criteria.
Tariffs among the three countries are either already zero or are being phased
out over a finite time period. There are provisions in NAFTA that give Mexican
apparel makers incentives to use fabric made in the United States. Because the
Corporation is a major U.S. apparel fabrics manufacturer and a resident,
diversified textile manufacturer in Mexico, the Corporation believes that NAFTA
is advantageous to the Corporation. Legislation has been introduced to grant
some NAFTA-like benefits to the Caribbean countries. The status of that
legislation is uncertain at this time.
It is possible that the combined benefits of NAFTA, coupled with
the significant growth of the use of U.S. produced textile products in Caribbean
Basin garment production under the "807" tariff program and the possibility of
enhanced trade with the Caribbean, could counterbalance some of the
disadvantages that will arise out of the changes contemplated in the Uruguay
Round (referred to below). The impact of the economic factors and
legislative/treaty provisions described above are apparent in the rapid growth
of U.S. apparel imports from the Caribbean Basin and Mexico, primarily due to
the advantages of quota/tariff provisions described above. Apparel imports from
the Caribbean Basin and Mexico have grown from 6.5% of total apparel imports in
1984 to 32.5% in 1995. Mexico has now become the largest exporter of apparel to
the U.S., surpassing China, which had been the largest since 1989.
Also of significance to domestic textile and apparel companies is
the ultimate impact of the Uruguay Round of multilateral trade negotiations held
under the auspices of GATT (General Agreement on Tariffs and Trade). The World
Trade Organization ("WTO") established under GATT in January, 1995 has
responsibility for overseeing international trade in manufactured goods,
agriculture, intellectual property and services. The WTO will oversee the
phaseout of textile and apparel quotas over a ten-year period. In addition,
tariffs on textile/apparel products will be reduced (but not eliminated) over
the same ten-year period. After the end of the ten years, textile/apparel trade
would revert to regular GATT rules which would prohibit quotas and most other
non-tariff barriers.
Over the years, the Corporation has attempted to offset the
negative impact of increased imports by focusing on product lines and markets
that are less vulnerable to import penetration. Capital expenditures and systems
improvements have centered on strengthening value-added product and market
diversification strategies and on increasing productivity, lowering costs and
improving quality. The Corporation has also introduced manufacturing techniques
such as "just-in-time" and "Quick Response" and created electronic data links
with customers and suppliers, thereby shortening lead times and improving
service.
The long-run success of the Corporation's efforts will be
influenced in varying degrees by the phaseout of bilateral agreements with
textile and apparel exporting countries, NAFTA, the adoption of legislation or
administrative actions restricting or liberalizing trade among world textile
producing and consuming countries such as the enactment of the GATT/Uruguay
Round implementing legislation, the effectiveness of anti-dumping and
countervailing duty remedies and of enforcement activities by the U.S.
Government, the value of the United States dollar in relation to other
currencies and world economic developments generally. The Corporation's success
will also be affected by the ability of certain of the Corporation's apparel
fabrics customers to remain competitive, the success of the Corporation's
modernization and cost-reduction efforts and, most importantly, the ongoing
ability of the Corporation to produce innovative, quality products to satisfy
specific customer needs at competitive costs.
Employees
The number of persons employed by the Corporation in both its
domestic and foreign operations as of September 28, 1996, was approximately
21,000. The Corporation's workforce in the United States is not represented by
labor unions. All wage employees in the Corporation's Mexican operations
(approximately 800 persons) are represented by labor unions.
Customers
The Corporation markets its products to approximately 13,800
customers in the United States as well as to customers in Canada, Mexico, Latin
America, Europe and the Pacific Rim countries. For the 1996 fiscal year, no
single customer represented more than 10% of the Corporation's net sales, and
the Corporation's 10 largest customers accounted for approximately 27% of net
sales.
Backlog
Several of the Corporation's divisions operate in businesses that
are characterized by very short forward order positions. The businesses of other
operations have more extended positions. In the aggregate, however, the backlog
of orders at any time is not material, since most orders are deliverable within
a few months. The backlog of forward orders, after eliminating sales within the
Corporation, was approximately 13.3% of annual net sales at the end of the 1996
fiscal year, compared with approximately 14.8% of annual net sales at the end of
the 1995 fiscal year, virtually all of which was expected to be shipped within
less than a year. Backlog at the end of the 1996 fiscal year for the apparel
products segment was 15.3% of annual net sales of the segment and for the
interior furnishings products segment was 10.3% of annual net sales of the
segment.
Governmental Regulation
The Corporation is subject to various Federal, state and local
laws and regulations limiting the production, discharge, storage, handling and
disposal of a variety of substances, particularly the Federal Clean Water Act,
the Federal Clean Air Act (as amended in 1990), the Resource Conservation and
Recovery Act (including amendments relating to underground tanks) and the
Federal Comprehensive Environmental Response, Compensation and Liability Act as
amended by the Superfund Amendment and Reauthorization Act of 1986, and other
Federal, state and local laws and regulations for the protection of public
health and the environment. The Corporation is presently engaged in a number of
environmental remediation plans and has reported dispositions of waste which
could result in future remediation obligations. The Corporation cannot with
certainty assess at this time the impact of future emission standards and
enforcement practices under the 1990 Clean Air Act upon its operations or
capital expenditure requirements. Reference is also made to the discussion of
"Legal and Environmental Contingencies" under "Management's Discussion and
Analysis of Financial Condition and Results of Operations" in the Corporation's
1996 Annual Report to Shareholders, which is incorporated herein by reference.
The Corporation's operations also are governed by laws and
regulations relating to workplace safety and worker health, principally the
Occupational Safety and Health Act and regulations thereunder which, among other
things, establish cotton dust, formaldehyde, asbestos and noise standards, and
regulate the use of hazardous chemicals in the workplace. The Corporation uses
numerous chemicals, including resins containing formaldehyde, in processing some
of its products. Although the Corporation does not use asbestos in the
manufacture of its products, some of its facilities contain some structural
asbestos.
The Corporation believes that it has complied in all material
respects with the foregoing environmental or health and safety laws or
regulations and does not believe that future compliance with such laws or
regulations will have a material adverse effect on its results of operations or
financial condition.
Item 2. Properties
As of September 28, 1996, the Corporation operated 39
manufacturing plants in the United States, of which 22 were located in North
Carolina, 8 were in Virginia, 3 were in Arkansas, 2 were in Mississippi and 1
each was in Georgia, South Carolina, Tennessee and Texas. All but three of these
plants are owned in fee. The aggregate floor area of these manufacturing plants
in the United States is approximately 14.3 million square feet. The
Corporation's international operations include 3 manufacturing plants in Mexico.
Of the Corporation's manufacturing plants, 23 are used principally
in the apparel products segment and 19 are used in the interior furnishings
products segment. In addition, the Corporation has 4 manufacturing plants not
currently in operation. The Corporation's plants generally operate on a
three-shift basis for five-, six- or seven-day weeks during 49 weeks per year,
or fewer weeks per year during curtailments. The Corporation considers its
plants and equipment to be in excellent condition.
The corporate headquarters building in Greensboro, North Carolina,
containing approximately 430,000 square feet, was completed and occupied in
1971. The building is located on property occupied under a 99-year ground lease
that began in 1969. The Corporation has a major sales and merchandising office
in New York City, New York under a lease expiring in 2009.
Item 3. Legal Proceedings
In June 1992, an action was commenced in the United States
District Court for the Eastern District of Arkansas by two employees of the
Corporation, purporting to represent as a class all participants in the
Company's Employee Stock Ownership Plan ("ESOP"), which was created in 1989. In
that year, the Corporation's then-parent sold shares of common stock to the ESOP
for an aggregate purchase price of $112.5 million (the "ESOP Purchase"). The
defendants included the Corporation and certain of its officers, directors and
employees, Morgan Stanley & Co. and two of its employees, and NationsBank of
Georgia, N.A. ("NationsBank of Georgia"), the independent trustee of the ESOP.
The complaint, as amended, alleged certain breaches of duty by defendants,
acting as fiduciaries, the entry into certain "prohibited transactions", and
violation of Section 10b-5 of the Securities Exchange Act of 1934, in each case
under federal law, and certain breaches of fiduciary duty under Delaware law, in
connection with the ESOP Purchase and certain other corporate transactions
entered into by the Corporation between 1987 and 1992. The complaint sought an
award of damages to the ESOP trust, payment of attorneys' fees and costs, and
demanded rescission of the 1989 sale of common stock to the ESOP trust and
removal of the defendants as ESOP fiduciaries. In November, 1992, the Court
granted the motion of the Corporation to transfer venue to the Middle District
of North Carolina.
The Federal Court in North Carolina certified the case as a class
action. After discovery was completed, the defendants moved for summary
judgment. The motion was pending at the time the parties entered into a
"Stipulation of Settlement" to settle the case for the amount of $26,500,000,
with each of the corporate defendants agreeing to pay approximately $9,056,085
(which included accrued interest). The Stipulation of Settlement was given
provisional approval by the Court on July 19, 1996, and on September 20, 1996,
the Court entered an order of final approval of the settlement. On October 28,
1996, the sum of $9,056,085 was paid by or on behalf of the Corporation to the
Settlement Administrator. The settlement fund, less amounts paid towards
attorney fees and other expenses as ordered by the Court, was paid to
NationsBank N.A. (South), successor in interest to NationsBank (Georgia) as the
ESOP trustee, on October 29, 1996, for administration pursuant to the terms of
the ESOP trust.
The Corporation and its subsidiaries also have sundry claims and
other lawsuits pending against them and also have made certain guarantees in the
ordinary course of business. It is not possible to determine with certainty the
ultimate liability, if any, of the Corporation in any of the matters referred to
in this item, but in the opinion of management, their outcome should have no
material adverse effect upon the financial condition or results of operations of
the Corporation.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Executive Officers of the Corporation
The Corporation's executive officers are listed below.
Name Age Position
---- --- --------
George W. Henderson, III......... 48 Director, President and Chief
Executive Officer
Bernard A. Leventhal............. 63 Director and Vice Chairman
Abraham B. Stenberg.............. 61 Director, Executive Vice President
and President and Chief Operating
Officer of the Burlington Interior
Furnishings Group
Gary P. Welchman................. 53 Executive Vice President
John D. Englar................... 49 Director, Senior Vice President,
Corporate Development and Law
Charles E. Peters, Jr. .......... 45 Senior Vice President and Chief
Financial Officer
James H. Clippard, Jr. .......... 59 Vice President, Investor Relations
Agustin J. Diodati............... 58 Vice President and Controller
Barbara K. Eisenberg............. 51 Vice President, Corporate Secretary
and Associate General Counsel
James M. Guin.................... 53 Vice President, Human Resources and
Public Relations
Lynn L. Lane..................... 45 Vice President and Treasurer
George C. Waldrep, Jr. .......... 57 Group Vice President
Robert A. Wicker................. 52 Vice President and General Counsel
Mr. Henderson has been Chief Executive Officer of the Corporation
since 1995 and President and Chief Operating Officer of the Corporation since
1993. He was a Group Vice President of the Corporation for more than five years
prior to 1993.
Mr. Leventhal has been Vice Chairman of the Corporation since
1995. Prior thereto, he was an Executive Vice President of the Corporation (from
1993) and President of the Corporation's Menswear division for more than five
years. Mr. Leventhal was a Group Vice President of the Corporation for more than
five years prior to 1993.
Mr. Stenberg has been an Executive Vice President of the
Corporation since 1993 and President and Chief Operating Officer of the
Burlington Interior Furnishings Group since 1995, in which capacity he has
senior management responsibility for the Corporation's interior furnishings
segment's four businesses--Burlington House, Burlington House Area Rugs, Lees
and The Bacova Guild, Ltd.--as well as the Corporation's operations in Mexico.
Prior thereto, he was a Group Vice President of the Corporation for more than
five years prior to 1993.
Mr. Welchman has been Executive Vice President of the Corporation
since 1993. Prior thereto, he was a Group Vice President of the Corporation
(from 1991). He has served as President of the Klopman Fabrics division for more
than five years.
Mr. Englar has been Senior Vice President, Corporate Development
and Law of the Corporation since 1995. Prior thereto, he was a Senior Vice
President, Finance and Law (from 1993) and Chief Financial Officer of the
Corporation (from 1994). He was Vice President and General Counsel of the
Corporation for more than five years prior to 1994 and Secretary for more than
five years prior to 1993.
Mr. Peters has been Senior Vice President and Chief Financial
Officer of the Corporation since 1995. He was Senior Vice President-Finance of
Boston Edison Company from 1991 until joining Burlington and Senior Vice
President and Chief Financial Officer of GenRad, Inc., a multi-national
manufacturer of automatic test equipment, prior to 1991.
Mr. Clippard has been Vice President, Investor Relations since
August, 1996. Prior thereto, he was Vice President, Finance and Investor
Relations (from 1994). For more than five years prior thereto he was Director of
Investor Relations for IBM Corporation.
Mr. Diodati has been a Vice President and Controller of the
Corporation for more than five years.
Ms. Eisenberg has been Vice President of the Corporation since
1995. She has been Secretary of the Corporation since 1993 and Associate General
Counsel of the Corporation for more than five years.
Mr. Guin has been Vice President, Human Resources and Public
Relations, since January, 1996. He was Director of Human Resources for the
Corporation from 1993 through 1995 and prior thereto he was a divisional
personnel manager for various divisions of the Corporation.
Ms. Lane was elected Vice President and Treasurer of the
Corporation in August, 1996. She was Vice President and Treasurer of R.J.
Reynolds Tobacco Company from 1995 until joining Burlington and was Vice
President and Assistant Treasurer, Capital Markets of RJR Nabisco, Inc. from
1991 to 1995.
Mr. Waldrep has been a Group Vice President of the Corporation for
more than five years.
Mr. Wicker has been Vice President and General Counsel of the
Corporation since 1995. He was Associate General Counsel of the Corporation
since 1993, and was a partner at the law firm of Smith, Helms, Mulliss & Moore
for more than five years prior thereto.
Executive officers of the Corporation are elected by, and serve at
the discretion of, its Board of Directors. None of the executive officers or
Directors of the Corporation is related by blood, marriage or adoption to any
other executive officer or Director of the Corporation.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters
Reference is made to Note R to the Notes to Consolidated Financial
Statements in the Corporation's 1996 Annual Report to Shareholders, which is
incorporated herein by reference, for information concerning the composite high
and low sales prices for the Corporation's Common Stock for each fiscal quarter
of fiscal years 1996 and 1995. The Corporation's common stock is traded on the
New York Stock Exchange and the Pacific Stock Exchange.
As of November 18, 1996, there were approximately 1,652 holders of
record of the Corporation's common stock and four holders of record of the
Corporation's nonvoting common stock.
The Corporation has not paid any cash dividends on its common
stock during fiscal years 1996 and 1995. The Corporation's bank credit agreement
places annual limitations on the payment of dividends on the Corporation's
common stock. Under such agreement, the Corporation may not pay dividends in an
aggregate amount in any fiscal year, on a cumulative basis since the beginning
of such fiscal year through such time, in an amount exceeding 50% of
Consolidated Net Income (as defined in such bank credit agreement) for the
preceding fiscal year.
Item 6. Selected Financial Data
The information required by this Item is set forth in the table
entitled "Statistical Review" in the Corporation's 1996 Annual Report to
Shareholders, and is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The information required by this Item is set forth under the
caption "Management's Discussion and Analysis of Results of Operations and
Financial Condition" in the Corporation's 1996 Annual Report to Shareholders,
and the material referenced therein in Notes B and O to the Notes to
Consolidated Financial Statements in the Corporation's 1996 Annual Report to
Shareholders and is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data
The financial statements, including the Report of the
Corporation's Independent Auditors, required by this Item are incorporated
herein by reference to the Corporation's 1996 Annual Report to Shareholders. See
Item 14 for a list of those financial statements and the pages of the
Corporation's 1996 Annual Report to Shareholders from which they are
incorporated.
INDEX TO FINANCIAL STATEMENT SCHEDULE
Page No.
---------
Burlington Industries, Inc. and Subsidiary Companies:
II. Valuation and Qualifying Accounts. S-1
All other schedules have been omitted because they are not
applicable, not required or because the required information is included in the
consolidated financial statements or notes thereto.
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 required by this Item is set forth under the
caption "Information about Nominees and Directors" in the Corporation's Proxy
Statement dated December 16, 1996 and is incorporated herein by reference.
Information with respect to the Corporation's executive officers
is included in Part I of this Report.
Item 11. Executive Compensation
The information required by this Item is set forth under the
captions "Compensation of Directors"; "Report of the Compensation and Benefits
Committee on Executive Compensation"; "Executive Compensation"; and "Stock
Performance Graph" in the Corporation's Proxy Statement dated December 16, 1996
and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The information required by this Item is set forth under the
caption "Security Ownership of Certain Beneficial Owners and Management" in the
Corporation's Proxy Statement dated December 16, 1996 and is incorporated herein
by reference.
Item 13. Certain Relationships and Related Transactions
The information required by this Item is set forth in the
paragraph immediately following the notes to the Summary Compensation Table in
the Corporation's Proxy Statement dated December 16, 1996 and is incorporated
herein by reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) 1. Financial Statements
The information contained in the Corporation's 1996 Annual
Report to Shareholders under the captions and on the pages
indicated below is incorporated herein by reference:
Report of Ernst & Young LLP,
Independent Auditors (page 40)
Consolidated Statements of Operations -
for the fiscal years ended September 28, 1996,
September 30, 1995 and October 1, 1994 (page 24)
Consolidated Balance Sheets -
as of September 28, 1996 and September 30, 1995
(page 25)
Consolidated Statements of Cash Flows -
for the fiscal years ended September 28, 1996,
September 30, 1995 and October 1, 1994 (page 26)
Notes to Consolidated Financial Statements (pages 27
to 38)
2. Financial Statement Schedules
The financial statement schedule listed under Item 8 is
filed as a part of this Report.
3. Exhibits
The exhibits listed on the accompanying Index to Exhibits
are filed as a part of this Report.
(b) The Corporation has not filed any reports on Form 8-K
during the last quarter of fiscal year 1996.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Corporation has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
BURLINGTON INDUSTRIES, INC.
Date: December 12, 1996
By /s/ George W. Henderson, III
--------------------------------
George W. Henderson, III
President and Chief
Executive Officer
(Principal Executive Officer)
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
Corporation and in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ George W. Henderson, III Director, President and December 12, 1996
- ---------------------------- Chief Executive Officer
George W. Henderson, III (Principal Executive Officer)
/s/ Charles E. Peters, Jr. Senior Vice President and December 12, 1996
- ---------------------------- Chief Financial Officer
Charles E. Peters, Jr. (Principal Financial Officer)
/s/ Agustin J. Diodati Vice President and Controller December 12, 1996
- ---------------------------- (Principal Accounting
Agustin J. Diodati Officer)
/s/ Joseph F. Abely, Jr. Director December 12, 1996
- ----------------------------
Joseph F. Abely, Jr.
/s/ John D. Englar Director December 12, 1996
- ----------------------------
John D. Englar
/s/ Frank S. Greenberg Director December 12, 1996
- ----------------------------
Frank S. Greenberg
/s/ Bernard A. Leventhal Director December 12, 1996
- ----------------------------
Bernard A. Leventhal
/s/ David I. Margolis Director December 12, 1996
- ----------------------------
David I. Margolis
/s/ John G. Medlin, Jr. Director December 12, 1996
- ----------------------------
John G. Medlin, Jr.
/s/ Nelson Schwab III Director December 12, 1996
- ----------------------------
Nelson Schwab III
/s/ Abraham B. Stenberg Director December 12, 1996
- ----------------------------
Abraham B. Stenberg
Index to Exhibits
-----------------
(Item 14(a)(3))
Exhibit
No. Description
---------- -----------
3.1 Restated Certificate of Incorporation of the Corporation
(incorporated by reference from the Corporation's Registration
Statement on Form 8-B, filed on June 3, 1994.)
3.2 Bylaws of the Corporation (incorporated by reference from the
Corporation's Form 10-K Annual Report for the fiscal year
ended October 1, 1994.)
4.1 Credit Agreement dated as of September 30, 1988, as amended
and restated as of November 8, 1995, among the Corporation,
the Lenders listed therein, Chemical Bank ("Chemical"), Bank
of America Illinois, The Bank of Nova Scotia ("Scotiabank"),
The Chase Manhattan Bank, N.A., First Union National Bank of
North Carolina, NationsBank, N.A. and Wachovia Bank of North
Carolina, N.A., as Managing Agents, Chemical, as
Administrative Agent, and Scotiabank, as Fronting Bank
(incorporated by reference from the Corporation's Form 8-K
Report dated November 9, 1995).
4.2 Indenture dated as of September 1, 1995, between the
Corporation and Wachovia Bank of North Carolina, N.A., as
Trustee, relating to the 7.25% Notes of the Corporation due
2005 (incorporated by reference from the Corporation's
Registration Statement on Form S-3, filed on August 2, 1995.)
NOTE: Pursuant to the provisions of Item 601 (b)(4)(iii) of
Regulation S-K, the Corporation hereby undertakes to furnish
to the Commission upon request copies of other instruments
pursuant to which various entities hold long-term debt of the
Corporation or its consolidated or unconsolidated
subsidiaries, none of which instruments governs indebtedness
exceeding 10% of the total assets of the Corporation and its
subsidiaries on a consolidated basis.
10.1 Lease dated as of May 1, 1994, between the Corporation and The
Fisher-Sixth Avenue Company and Hawaiian Sixth Ave. Corp.
(incorporated by reference from the Corporation's Registration
Statement on Form 8-B, filed on June 3, 1994.)
10.2 Indenture of Lease dated February 26, 1969, between Blanche S.
Benjamin and Edward B. Benjamin, and a predecessor to the
Corporation, including the amendment thereto (incorporated by
reference from Holdings' Registration Statement on Form S-1,
File No. 33-16437, filed on August 12, 1987.)
10.3 Agreement dated as of February 1, 1996, between the
Corporation and George W. Henderson, III (incorporated by
reference from the Corporation's Form 10-Q Quarterly Report
for the fiscal quarter ended March 30, 1996). (Management
contract or compensatory plan, contract or arrangement).
10.4 Agreement dated as of November 8, 1994, between the
Corporation and Bernard A. Leventhal (incorporated by
reference from the Corporation's Form 10-K Annual Report for
the fiscal year ended October 1, 1994). (Management contract
or compensatory plan, contract or arrangement).
10.5 Agreement dated as of November 8, 1994, between the
Corporation and Abraham B. Stenberg (incorporated by reference
from the Corporation's Form 10-K Annual Report for the fiscal
year ended October 1, 1994). (Management contract or
compensatory plan, contract or arrangement).
10.6 Agreement dated as of February 1, 1996, between the
Corporation and John D. Englar (incorporated by reference from
the Corporation's Form 10-Q Quarterly Report for the fiscal
quarter ended March 30, 1996). (Management contract or
compensatory plan, contract or arrangement).
10.7 Agreement dated as of February 1, 1996, between the
Corporation and James M. Guin (incorporated by reference from
the Corporation's Form 10-Q Quarterly Report for the fiscal
quarter ended March 30, 1996). (Management contract or
compensatory plan, contract or arrangement).
10.8 Agreement dated as of February 1, 1996, between the
Corporation and Gary P. Welchman (incorporated by reference
from the Corporation's Form 10-Q Quarterly Report for the
fiscal quarter ended March 30, 1996). (Management contract or
compensatory plan, contract or arrangement).
10.9 Agreement dated as of June 1, 1995, between the Corporation
and Agustin J. Diodati (incorporated by reference from the
Corporation's Form 10-K Annual Report for the fiscal year
ended September 30, 1995). (Management contract or
compensatory plan, contract or arrangement).
10.10 Agreement dated as of May 1, 1996, between the Corporation and
George C. Waldrep, Jr. (incorporated by reference from the
Corporation's Form 10-Q Quarterly Report for the fiscal
quarter ended June 29, 1996). (Management contract or
compensatory plan, contract or arrangement).
10.11 Agreement dated as of November 13, 1995, between the
Corporation and Charles E. Peters, Jr. (incorporated by
reference from the Corporation's Form 10-K Annual Report for
the fiscal year ended September 30, 1995). (Management
contract or compensatory plan, contract or arrangement).
10.12 Agreement dated as of July 5, 1996, between the Corporation
and Lynn L. Lane. (Management contract or compensatory plan,
contract or arrangement).
10.13 1994 Deferred Compensation Plan (incorporated by reference
from the Form 10-K Annual Report for Burlington Equity for the
fiscal year ended October 2, 1993). (Management contract or
compensatory plan, contract or arrangement).
10.14 Form of Stock Purchase Agreement dated as of March 19, 1992,
between Burlington Industries Equity Inc. (predecessor to the
Corporation, "Burlington Equity") and The Equitable Life
Assurance Society of the United States and its affiliates (the
"Equitable Investors") (incorporated by reference from
Amendment No. 6 to Burlington Equity's Registration Statement
on Form S-1, File No. 33-45149, filed on March 19, 1992).
(Management contract or compensatory plan, contract or
arrangement).
10.15 Description of Supplemental Pre-Retirement and Post-Retirement
Benefits Plan, as amended, and form of participant agreement
(incorporated by reference from the Form 10-K Annual Report
for Burlington Equity for the fiscal year ended October 2,
1993). (Management contract or compensatory plan, contract or
arrangement).
10.16 Benefits Equalization Plan, as amended and restated on July
28, 1994 (incorporated by reference from the Corporation's
Form 10-K Annual Report for the 1994). (Management contract or
compensatory plan, contract or arrangement).
10.17 Stock Plan for Non-Employee Directors, as amended
(incorporated by reference from the Corporation's Registration
Statement on Form 8-B, filed on June 3, 1994). (Management
contract or compensatory plan, contract or arrangement).
10.18(a) Burlington Industries Equity Inc. 1992 Equity Incentive Plan
("1992 Incentive Plan") (incorporated by reference from
Amendment No. 3 to Burlington Equity's Registration Statement
on Form S-1, File No. 33-45149, filed on March 5, 1992).
(Management contract or compensatory plan, contract or
arrangement).
10.18(b) Amendments to the 1992 Incentive Plan, effective as of July
22, 1992 (incorporated by reference from the Form 10-K Annual
Report for Burlington Equity for the fiscal year ended October
3, 1992). (Management contract or compensatory plan, contract
or arrangement).
10.18(c) Forms of agreements under 1992 Incentive Plan (incorporated by
reference from the Form 10-K Annual Report for Burlington
Equity for the fiscal year ended October 3, 1992). (Management
contract or compensatory plan, contract or arrangement).
10.18(d) Forms of amendments to agreements under 1992 Incentive Plan,
effective as of July 28, 1993 (incorporated by reference from
the Form 10-K Annual Report for Burlington Equity for the
fiscal year ended October 2, 1993). (Management contract or
compensatory plan, contract or arrangement).
10.19(a) Burlington Industries, Inc. 1995 Equity Incentive Plan ("1995
Incentive Plan") (incorporated by reference from Exhibit A to
the Corporation's proxy statement dated December 18, 1995).
(Management contract or compensatory plan, contract or
arrangement).
10.19(b) Amendment to 1995 Incentive Plan, effective as of November 1,
1995. (Management contract or compensatory plan, contract or
arrangement).
10.19(c) Form of agreement under 1995 Incentive Plan (incorporated by
reference from the Corporation's Form 10-Q Quarterly Report
for the fiscal quarter ended March 30, 1996). (Management
contract or compensatory plan, contract or arrangement).
10.20(a) Consulting Agreement between the Corporation and Frank S.
Greenberg for calendar year 1996, effective January 1, 1996
(incorporated by reference from the Corporation's Form 10-K
Annual Report for the fiscal year ended September 30, 1995).
(Management contract or compensatory plan, contract or
arrangement).
10.20(b) Consulting Agreement between the Corporation and Frank S.
Greenberg for calendar year 1997, effective January 1, 1997.
(Management contract or compensatory plan, contract or
arrangement).
10.21(a) Stockholder Agreement ("Stockholder Agreement") dated as of
October 23, 1990, among Burlington Equity and the other
parties listed on the signature pages thereof (incorporated by
reference from the Form 10-K Annual Report for Capital for the
fiscal year ended September 29, 1990).
10.21(b) Amendment dated January 17, 1992, to the Stockholder Agreement
(incorporated by reference from Amendment No. 3 to Burlington
Equity's Registration Statement on Form S-1, File No.
33-45149, filed on March 5, 1992).
10.21(c) Letter agreement dated October 25, 1993, with respect to the
Stockholder Agreement (incorporated by reference from the
Corporation's Form 10-K Annual Report for the fiscal year
ended September 30, 1995).
10.22 Receivables Purchase Agreement dated as of March 26, 1992, as
amended and restated as of August 17, 1994, among B.I.
Funding, Inc. ("BIF"), the Corporation, B.I. Transportation,
Inc. ("BIT") and Burlington Fabrics Inc. ("Fabrics")
(incorporated by reference from the Corporation's Form 8-K
Report dated August 18, 1994).
10.23 Amended and Restated Liquidity Agreement dated as of August
17, 1994, among BIF, certain financial institutions as
Liquidity Lenders, and Scotiabank, as the Liquidity Agent for
the Liquidity Lenders (incorporated by reference from the
Corporation's Form 8-K Report dated August 18, 1994).
10.24 Facility Agreement dated as of December 18, 1992, as amended
and restated as of August 17, 1994, among BIF, the
Corporation, as Servicer, and Scotiabank, as Liquidity Agent
and Collateral Agent (incorporated by reference from the
Corporation's Form 8-K Report dated August 18, 1994).
10.25(a) Form of Commercial Paper Dealer Agreement between the
Corporation, BIF and dealers of BIF securities ("Dealer
Agreement") (incorporated by reference from the Form 10-Q
Quarterly Report for Burlington Equity for the fiscal quarter
ended January 2, 1993).
10.25(b) Amendment No. 1 to the Dealer Agreement (incorporated by
reference from the Corporation's Form 8-K Report dated August
18, 1994).
10.26(a) Depositary and Issuing and Paying Agent Agreement dated
December 18, 1992, between Chemical and BIF ("DIPA Agreement")
(incorporated by reference from the Form 10-Q Quarterly Report
for Burlington Equity for the fiscal quarter ended January 2,
1993).
10.26(b) Amendment No. 1 dated as of August 17, 1994, to the DIPA
Agreement (incorporated by reference from the Corporation's
Form 8-K Report dated August 18, 1994).
10.27(a) Amended and Restated Subordination Agreement, Consent and
Acknowledgment, dated as of December 18, 1992, among Fabrics,
the Corporation, BIT, BIF and Scotiabank, as Liquidity and
Collateral Agent ("Subordination Agreement") (incorporated by
reference from the Form 10-Q Quarterly Report for Burlington
Equity for the fiscal quarter ended January 2, 1993).
10.27(b) Amendment No. 1 dated as of August 17, 1994, to the
Subordination Agreement (incorporated by reference from the
Corporation's Form 8-K Report dated August 18, 1994).
12 Computation of Ratio of Earnings to Fixed Charges.
13 Portions of the Corporation's 1996 Annual Report to
Shareholders expressly incorporated by reference.
22 List of subsidiaries of the Corporation.
23 Consent of Ernst & Young LLP.
27 Financial Data Schedule.
Schedule II
BURLINGTON INDUSTRIES INC. AND SUBSIDIARY COMPANIES
Valuation and Qualifying Accounts
(Amounts in Thousands)
Additions
------------------------------
Charged
(Credited)
Balance at to Costs Charged Balance
Beginning and to Other at Close
Description of Period Expenses Accounts Deductions of Period
----------- ---------- --------- -------- ---------- ---------
Fiscal year ended September 28, 1996
- ------------------------------------
Deducted from customer
accounts receivable:
Doubtful accounts.... $ 4,226 $ 6,457 $ - $ 4,487 (2) $ 6,154
42 (3)
Discounts............ 1,022 (113)(1) - - 909
Returns and
allowances.......... 13,974 429 (1) - - 14,403
------- ------- --- ------- -------
$19,222 $ 6,773 $ - $ 4,529 $21,466
======= ======= === ======= =======
Fiscal year ended September 30, 1995
- ------------------------------------
Deducted from customer
accounts receivable:
Doubtful accounts.... $ 4,001 $10,382 $103(4) $10,184 (2) $ 4,226
76 (3)
Discounts............ 995 27 (1) - - 1,022
Returns and
allowances.......... 12,250 1,559 (1) 165(4) - 13,974
------- ------- --- ------- -------
$17,246 $11,968 $268 $10,260 $19,222
======= ======= ==== ======= =======
Fiscal year ended October 1, 1994
- ---------------------------------
Deducted from customer
accounts receivable:
Doubtful accounts.... $ 4,157 $ 1,624 $ - $ 1,719 (2) $ 4,001
61 (3)
Discounts............ 1,009 (14) (1) - - 995
Returns and
allowances.......... 12,546 (296) (1) - - 12,250
------- ------- --- ------- -------
$17,712 $ 1,314 $ - $ 1,780 $17,246
======= ======= ==== ======= =======
(1) Represents net increase (decrease) in required reserves.
(2) Uncollectible accounts receivable written off, net of recoveries.
(3) Represents changes in reserves due to foreign exchange fluctuation.
(4) Represents increase attributable to acquisition.
S-1