EXHIBIT 99.2
------------
WESTPOINT STEVENS INC.
507 West Tenth Street
West Point, Georgia 31833
May 21, 2001
To Our Stockholders:
On May 9, 2001, your Board of Directors adopted a new
Stockholder Rights Plan. As part of the Plan, the Board declared a dividend
distribution of one Common Stock Purchase Right (a "Right") on each outstanding
share of Common Stock of the Company outstanding as of the close of business on
May 21, 2001. A Summary of Rights explaining the terms of the Rights is enclosed
with this letter.
We believe a Stockholder Rights Plan enhances your Board's
ability to represent the interests of stockholders of the Company effectively in
the event of an unsolicited takeover attempt. There are numerous means by which
an acquiror can obtain control of a target company upon terms which are unfair
to its stockholders and by means which significantly weaken the target company.
The Rights issued under the Plan contain provisions designed to protect
stockholders against abusive practices which can unfairly pressure stockholders
to sell their stock at less than full value. Many other U.S. companies have
issued rights similar to those approved by your Board to protect their
stockholders against these tactics. The Board of Directors did not adopt the
Rights Plan in response to any specific takeover threat.
The distribution of these Rights is not intended to prevent a
takeover of the Company on terms beneficial to its stockholders and, in fact,
will not do so. However, it should deter an attempt to acquire the Company in a
manner or on terms that the Board determines not to be in the best interests of
its stockholders. The Rights are designed to deal with the very serious problem
of a takeover attempt that deprives the Company's Board and its stockholders of
any real opportunity to determine the destiny of the Company.
The Rights may be redeemed by the Company at $0.001 per Right
at any time prior to the close of business on the tenth day after there has been
a public announcement that beneficial ownership of 15% or more of the Company's
voting stock has been accumulated by a single acquiror or group, subject to
certain exceptions. Thus, the Rights should not interfere with a negotiated
merger or other business combination approved by the Board.
Issuance of the Rights does not in any way weaken the
financial strength of the Company or interfere with its business plans. The
issuance of the Rights has no present dilutive effect, will not affect reported
earnings per share, is not taxable to the Company or to you under current
federal income tax law, and will not change the way in which the Company's
shares of Common Stock may be traded. If the Rights should become exercisable,
stockholders, depending on then existing circumstances, may recognize taxable
income.
The Board was aware when it acted that some people have
advanced arguments that securities of the sort we are issuing deter legitimate
acquisition proposals. The Board carefully considered those views and concluded
that the arguments are speculative and unconvincing and certainly do not justify
leaving stockholders with less effective protection against unfair treatment by
an acquiror who, after all, would be seeking its own advantage, not yours. The
Board believes that these Rights represent a sound, reasonable and appropriate
means of addressing the complex issues of corporate policy developed as a
response to the threat of coercive takeovers.
In declaring the Rights dividend, we have expressed our
confidence in the Company's future, and we believe we have increased your
ability to participate in that future.
Sincerely,
Holcombe T. Green, Jr.
Chairman of the Board and
Chief Executive Officer
2