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 DECEMBER 30, 2000
Commission file number: 1-5256
V. F. CORPORATION
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 23-1180120
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
628 GREEN VALLEY ROAD, SUITE 500
GREENSBORO, NORTH CAROLINA 27408
(Address of principal executive offices)
(336) 547-6000
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Name of each exchange
Title of each class on which registered
- ------------------- --------------------
Common Stock, without par value, New York Stock Exchange
stated capital $1 per share and
Preferred Stock Purchase Rights Pacific 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 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]
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As of March 6, 2001, 112,250,496 shares of Common Stock of the registrant were
outstanding, and the aggregate market value of the common shares (based on the
closing price of these shares on the New York Stock Exchange) of the registrant
held by nonaffiliates was approximately $3.1 billion. In addition, 1,570,301
shares of Series B ESOP Convertible Preferred Stock of the registrant were
outstanding and convertible into 2,512,482 shares of Common Stock of the
registrant, subject to adjustment. The trustee of the registrant's Employee
Stock Ownership Plan is the sole holder of such shares, and no trading market
exists for the Series B ESOP Convertible Preferred Stock.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Report to Shareholders for the fiscal year ended December
30, 2000 (Item 1 in Part I and Items 5, 6, 7, 7A and 8 in Part II).
Portions of the Proxy Statement dated March 22, 2001 for the Annual Meeting of
Shareholders to be held on April 24, 2001 (Item 4A in Part I and Items 10, 11,
12 and 13 in Part III).
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PART I
ITEM 1. BUSINESS
VF Corporation, through its operating subsidiaries, designs, manufactures and
markets branded jeanswear, intimate apparel, occupational apparel, knitwear,
outdoor apparel and equipment, children's playwear and other apparel. VF
Corporation, organized in 1899, oversees the operations of its individual
businesses, providing them with financial and administrative resources. Unless
the context indicates otherwise, the term "Company" used herein means VF
Corporation and its subsidiaries.
The Company manages its business through over two dozen consumer-focused
marketing units that support specific brands. Management of the individual
marketing units has the responsibility to build and develop their brands within
guidelines established by Company management. Marketing units with generally
similar products have been grouped together into three reportable business
segments - Consumer Apparel, Occupational Apparel and All Other.
Certain financial information regarding the Company's three reportable segments,
as well as geographic information and sales by product category, is included in
Note O of the Company's consolidated financial statements in the Company's
Annual Report to Shareholders for the fiscal year ended December 30, 2000 ("2000
Annual Report"), which is incorporated herein by reference.
CONSUMER APPAREL SEGMENT
JEANSWEAR AND RELATED PRODUCTS
Jeanswear and related casual products are manufactured and marketed in the
United States and in many international markets. In the United States, jeanswear
products are manufactured and marketed under the LEE(R), WRANGLER(R),
RUSTLER(R), RIDERS(R) and BRITTANIA(R) brands. During 2000, the Company acquired
the CHIC(R) and GITANO(R) brands. The Company also offers cotton casual pants
and shirts under the LEE CASUALS(R) and TIMBER CREEK BY WRANGLER(R) brands.
In domestic markets, LEE branded products are sold through department and
specialty stores. WRANGLER westernwear is marketed through western specialty
stores, and other WRANGLER brand products are sold primarily through the mass
merchant and discount store channels. The RUSTLER and RIDERS brands are marketed
to national and regional discount chains. Sales for all brands are generally
made directly to retailers through full-time salespersons.
According to industry data, approximately 697 million pairs of jeans made of
denim, twill, corduroy and other fabrics were sold in the United States in 2000,
representing a 5.0% increase over 1999. This same data indicates that the
Company currently has the largest combined unit market share at approximately
27%, with the WRANGLER, LEE and RUSTLER brands having the first, third and
fourth largest unit shares of the jeans market in the United States,
respectively.
In international markets, the Company's largest jeanswear operation is in
Western Europe, where the Company manufactures and markets LEE, WRANGLER,
MAVERICK(R) and OLD AXE(R) jeanswear and related products. In late 2000, the
Company acquired 85% of the common stock of H.I.S. sportswear AG, which
manufactures and markets H.I.S(R) brand jeanswear products primarily for women.
LEE, WRANGLER and H.I.S jeanswear products are sold through department stores
and specialty shops,
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while the MAVERICK and OLD AXE brands are sold to discount stores. Jeanswear in
Europe and in most international markets is fashion-driven and has a higher
relative price than similar products in the United States. Jeanswear products
are sold to retailers through the Company's sales forces and independent sales
agents.
The LEE and WRANGLER brands are also marketed in Canada and Mexico.
Additionally, over the last three years, the Company has converted several
licensed operations in South America into owned operations. Currently, the
Company manufactures and markets the WRANGLER and LEE brands in several South
American countries through operations based in Brazil, Argentina and Chile.
These products are sold through department and specialty stores. Also, in late
1999, the Company acquired a business that manufactures and markets the licensed
UFO brand, a leading local jeans brand in Argentina and other countries.
The Company also manufactures and markets LEE products in China and participates
in a joint venture in Spain and Portugal. Near the end of 2000, the Company
transferred its WRANGLER business in Japan to a licensee. In foreign markets
where the Company does not have owned operations, LEE and WRANGLER jeanswear and
related products are marketed through distributors, agents or licensees.
INTIMATE APPAREL
The Company manufactures and markets women's intimate apparel under the VANITY
FAIR(R), LILY OF FRANCE(R) and the licensed Tommy Hilfiger(R) and Natori(R)
labels for sales to domestic department and specialty stores. Products include
bras, panties, daywear, shapewear, robes and sleepwear.Women's intimate apparel
is also manufactured and marketed under the VASSARETTE(R), BESTFORM(R) and
EXQUISITE FORM(R) brands for sale to the discount store channel of distribution.
The Company also has a significant private label lingerie business with various
national chain and specialty stores in the United States. Products are sold
through the Company's sales force.
In international markets, women's intimate apparel is also manufactured and
marketed to department and specialty stores under the LOU(R), BOLERO(R),
GEMMA(R), INTIMA CHERRY(R) and BELCOR(R) brands primarily in France and Spain.
Intimate apparel is marketed in discount stores in France under the VARIANCE(R)
brand. The Company also markets the VANITY FAIR, VASSARETTE, BESTFORM and
EXQUISITE FORM brands in Europe.
CHILDREN'S PLAYWEAR
Infant and children's apparel is manufactured and marketed in the United States
under the HEALTHTEX(R) and LEE brands and under the licensed NIKE(R) brand.
Products are sold primarily to department and specialty stores. Beginning in
1999, the HEALTHTEX brand was made available over the internet through its
website, www.healthtex.com, as the Company's first e-commerce initiative selling
directly to consumers.
SWIMWEAR
The Company designs, manufactures and markets an extensive line of women's
swimwear under the JANTZEN(R) trademark and the licensed NIKE label. Products
are sold primarily to department and specialty stores in the United States and
Canada through the Company's sales force. The JANTZEN trademark is licensed to
other companies in several foreign countries. Swimwear is also manufactured and
marketed under various labels in Spain and France.
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OCCUPATIONAL APPAREL SEGMENT
The Company produces occupational and career apparel sold under the RED KAP(R)
label in the United States. Over one-half of these sales are to industrial
laundries that in turn supply work clothes to employers, primarily on a rental
basis, for on-the-job wear by production, service and white-collar personnel.
Products include work pants, slacks, work and dress shirts, overalls, jackets
and smocks. Since industrial laundries maintain minimal inventories of work
clothes, a supplier's ability to offer rapid delivery is an important factor in
this market. The Company's commitment to customer service, supported by an
automated central distribution center with several satellite locations, has
enabled customer orders to be filled within 24 hours of receipt and has helped
the RED KAP brand obtain a significant share of the industrial laundry rental
business.
Through several acquisitions in recent years, the Company has expanded its
product offerings to include restaurant apparel under the PENN STATE TEXTILE(R)
brand, "clean room" apparel under the FIBROTEK(R) brand and safety apparel
under the BULWARK(R) brand. In addition, the Company offers corporate image
uniforms and casual apparel. The Company operates a number of catalog web sites
for major business and governmental organizations, giving more than 300,000 of
their employees the convenience of shopping and paying for their work and career
apparel via the internet.
ALL OTHER SEGMENT
OUTDOOR CLOTHING AND EQUIPMENT
The Company manufactures and markets JANSPORT(R) brand daypacks sold through
department and sports specialty stores and college bookstores in the United
States and through department and specialty stores in Europe. JANSPORT daypacks
and bookbags have a leading brand share in the United States. The EASTPAK(R)
brand of daypacks was acquired in 2000 and integrated into the JanSport
business. The EASTPAK brand is sold primarily through discount stores in the
United States and through department and specialty stores in Europe. A more
technical line of JANSPORT backpacks are sold through outdoor and sporting goods
stores. In addition, JANSPORT branded fleece casualwear and T-shirts imprinted
with college logos are sold through college bookstores.
In 2000, the Company acquired The North Face, Inc., makers of high performance
outdoor apparel and equipment sold under THE NORTH FACE(R) brand. THE NORTH FACE
apparel products consist of outerwear, snowsports gear and functional
sportswear. Equipment consists of tents, sleeping bags, backpacks, daypacks and
accessories. THE NORTH FACE products are designed for extreme applications, such
as high altitude mountaineering and ice and rock climbing, although many
consumers who purchase those products use them for less extreme activities. THE
NORTH FACE products are sold through specialty outdoor and premium sporting
goods stores.
KNITWEAR
The Company manufactures and markets knitted fleecewear and T-shirts for the
United States market. Approximately 40% of the Company's knitwear sales are to
private label accounts, including NIKE, Inc. and various national chain,
department and discount stores. Blank fleece and T-shirt products are also
marketed under the LEE brand to wholesalers and garment screen-print operators.
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The Company also designs, manufactures and markets imprinted sports apparel
under licenses granted by the four major American professional sports leagues,
NASCAR and other parties. These sports apparel products for adults are
distributed through department, sporting goods and athletic specialty stores
under the LEE SPORT(R), NUTMEG(R) and the licensed CHASE AUTHENTICS(R) brands.
CSA(R) branded products are distributed through mass merchandisers and discount
stores.
RAW MATERIALS AND MANUFACTURING
Raw materials include fabrics made from cotton, synthetics and blends of cotton
and synthetic yarn. The Company also purchases thread and trim (buttons,
zippers, snaps and lace) from numerous suppliers.
For most domestic operations, the Company purchases fabric, primarily from
several domestic suppliers, against scheduled production. Purchased fabric is
cut and sewn into finished garments in domestic and offshore manufacturing
facilities in Mexico and the Caribbean Basin. In addition, the Company contracts
the sewing of products from independent contractors, primarily in Mexico, the
Caribbean Basin and Southeast Asia. To achieve a balanced sourcing mix, an
increasing percentage of production is in lower cost offshore plants. By the end
of 2000, approximately 67% of domestic sales were derived from products sewn
outside the United States.
In the Company's domestic knitwear and a portion of its domestic intimate
apparel businesses, operations are vertically integrated and include the entire
process of converting yarn into finished garments. The Company knits purchased
yarn into fabric in its facilities. The knit fabric is then dyed, finished and
cut in domestic facilities before it is sewn into finished garments. For the
knitwear operations, cotton yarn and cotton and synthetic blend yarn are
purchased from a major textile company under a long-term supply agreement. Yarn
is also available from numerous other sources.
For the Company's international businesses, fabric, thread and trim are
purchased from several international suppliers. In the European jeanswear
operations, fabric is cut and sewn into finished garments in owned plants in
Malta, Poland and Turkey, with the balance (mostly tops) sourced from
independent contractors. In the international intimate apparel businesses,
fabric is sewn into finished garments in owned plants in France, Spain and
Tunisia, with the remainder manufactured by independent contractors. To obtain a
more balanced sourcing mix, international jeanswear and intimate apparel
sourcing has been shifted from owned plants in Western Europe to lower cost
owned and contracted production outside of Western Europe. At the end of 2000,
approximately 50% of international sales were derived from Company-owned plants.
The Company did not experience difficulty in obtaining fabric and other raw
materials to meet production needs during 2000 and does not anticipate
difficulties in 2001. The loss of any one supplier would not have a significant
adverse effect on the Company's business.
SEASONALITY
The apparel industry in the United States has four primary retail selling
seasons -- Spring, Summer, Back-to-School and Holiday, while international
markets typically have Spring and Fall selling seasons. Sales to retailers
generally precede the retail selling seasons, although demand peaks have been
reduced in recent years as more products are being sold on a replenishment
basis.
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Overall, with its diversified product offerings, the Company's operating results
are not highly seasonal. On a quarterly basis, consolidated net sales range from
a low of approximately 23% of full year sales to a high of 27% in the third
quarter. Sales of knitwear products and outdoor clothing and equipment, however,
are more seasonal in nature, with approximately 30% of knitwear sales and 35% of
outdoor apparel and equipment sales in the third quarter.
Working capital requirements vary throughout the year. Working capital increases
during the first half of the year as inventory builds to support peak shipping
periods, and accordingly decreases during the second half. Cash provided by
operations is substantially higher in the second half of the year due to higher
net income and reduced working capital requirements during that period.
ADVERTISING
The Company supports its brands through extensive advertising and promotional
programs and through sponsorship of special events. The Company advertises on
national and local radio and television and in consumer and trade publications.
It also participates in cooperative advertising on a shared cost basis with
major retailers in radio, television and various print media. In addition,
point-of-sale fixtures and signage are used to promote products at the retail
level. During 2000, the Company spent $252 million advertising and promoting its
products.
OTHER MATTERS
COMPETITIVE FACTORS
The apparel industry is highly competitive and consists of a number of domestic
and foreign companies. Management believes that there is only one competitor in
the United States that has sales and assets in the apparel industry greater than
those of the Company. However, in certain product categories in which the
Company operates, there are several competitors that have more sales and assets
than the Company in those categories.
TRADEMARKS AND LICENSES
Trademarks are of material importance to all of the Company's marketing efforts.
Company-owned brands are protected by registration or otherwise in the United
States and most other markets where the Company's brands are sold. These
trademark rights are enforced and protected by litigation against infringement
as necessary. The Company has granted licenses to other parties to manufacture
and sell products under the Company's trademarks in product categories and in
geographic areas in which the Company does not operate.
In some instances, the Company pays a royalty to use the trademarks of others.
Apparel is manufactured and marketed under licenses granted by Major League
Baseball, the National Basketball Association, the National Football League, the
National Hockey League, NASCAR, NIKE, Inc., Tommy Hilfiger Corporation and
others. Some of these license arrangements are for a short term and may not
contain specific renewal options. Management believes that the loss of any
license would not have a material adverse effect on the Company.
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CUSTOMERS
The Company's customers are primarily department, chain, specialty and discount
stores in the United States and in international markets, primarily in Europe.
Sales to Wal-Mart Stores, Inc. totaled 13.9% of total sales in 2000 and 13.0% in
1999. Sales to the Company's ten largest customers amounted to 40% of total
sales in both 2000 and 1999.
EMPLOYEES
The Company employs approximately 75,000 men and women. Approximately 4,000
employees are covered by various collective bargaining agreements. Employee
relations are considered to be good.
BACKLOG
The dollar amount of backlog of orders believed to be firm as of any fiscal
year-end is not material for an understanding of the business of the Company
taken as a whole.
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
Information concerning forward-looking statements, as reported under the
caption "Cautionary Statement on Forward-looking Statements" on page 20 of the
2000 Annual Report, is incorporated herein by reference.
ITEM 2. PROPERTIES.
The Company owns most of its facilities used in manufacturing, distribution and
administrative activities. Certain other facilities are leased under operating
leases that generally contain renewal options. Management believes all
facilities and machinery and equipment are in good condition and are suitable
for the Company's needs. Manufacturing and distribution facilities being
utilized at the end of 2000 are summarized below by reportable segment:
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Square
Footage
----------
Consumer Apparel 14,100,000
Occupational Apparel 2,500,000
All Other 4,400,000
----------
21,000,000
==========
In addition, the Company also owns or leases various administrative and office
space having 1,700,000 square feet of space and owns or leases facilities having
3,500,000 square feet that are used for factory outlet operations. Approximately
76% of the factory outlet space is used for selling and warehousing the
Company's products, with the balance consisting of space leased to tenants and
common areas. Finally, the Company owns facilities having 200,000 square feet of
space formerly used in its operations but now held for sale.
ITEM 3. LEGAL PROCEEDINGS.
The Company is a party to litigation arising in the ordinary course of its
business. In addition, the Company, its subsidiary, The North Face, Inc., and
certain of The North Face's former and current officers and directors have been
named in various purported shareholder actions in California, Colorado and
Delaware, including Eng v. Cason, et al., Civil Action No. 810726-0 (California
Superior Court, Alameda County), Markus, et al. v. The North Face, Inc., Civil
Action No. 99-Z-473 (United States District Court for the District of Colorado),
and Polacheck v. VF Corporation, et al. (Court of Chancery, Delaware). The
actions alleged, among other things, self-dealing, breach of fiduciary duties
and violations of federal and state laws. In the Eng action, defendants' motion
to dismiss was granted with leave to amend. A settlement of the Markus
consolidated actions has received preliminary approval from the U.S. District
Court in Colorado. The Polacheck action has been settled. In management's
opinion, there are no pending claims or litigation, the outcome of which would
have a material adverse effect on the Company's consolidated financial position,
results of operations or cash flows.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 4A. EXECUTIVE OFFICERS OF THE COMPANY.
The following are the executive officers of VF Corporation as of March 6, 2001.
The term of office of each of the executive officers continues to the next
annual meeting of the Board of Directors to be held April 24, 2001. There is no
family relationship among any of the VF Corporation executive officers.
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Period Served
Name Position Age In Such Office(s)
- ---- -------- --- -----------------
Mackey J. McDonald Chairman of the Board 54 October 1998 to date
President October 1993 to date
Chief Executive Officer January 1996 to date
Director October 1993 to date
Robert A. Cordaro Vice President - Controller 47 February 2001 to date
Candace S. Cummings Vice President - Administration 53 March 1996 to date
and General Counsel
Secretary October 1997 to date
George N. Derhofer Vice President and Chairman - 47 October 2000 to date
Imagewear Coalition
Terry L. Lay Vice President and Chairman - 53 October 2000 to date
International Jeanswear Coalition
Vice President - Global Processes October 2000 to date
Frank C. Pickard III Vice President - Treasurer 56 April 1994 to date
John P. Schamberger Chairman - North & South 52 October 2000 to date
America Jeanswear and
Playwear Coalitions
Vice President April 1995 to date
Robert K. Shearer Vice President - Finance and 49 July 1998 to date
Chief Financial Officer
Eric C. Wiseman Vice President and Chairman- 45 October 2000 to date
Global Intimate Apparel Coalition
Mr. McDonald joined the Company's Lee division in 1983, serving in various
management positions until his election as Executive Vice President of the
Wrangler division in 1986 and President of Wrangler in 1988. He was named Group
Vice President of the Company in 1991, President of the Company in 1993, Chief
Executive Officer in January 1996 and Chairman of the Board in October 1998.
Additional information is included on page 2 of the Company's definitive proxy
statement dated March 22, 2001 for the Annual Meeting of Shareholders to be held
on April 24, 2001 ("2001 Proxy Statement").
Mr. Cordaro joined the Company in 1985, serving in various positions until being
appointed Assistant Treasurer in 1990. In 1992 he was named Chief Financial
Officer of Wrangler Europe and from 1994 to December 1996 held the position of
Chief Financial Officer of VF Europe. He was named President of VF Asia Pacific
in January 1997 and was elected Vice President - Controller of the Company in
February 2001.
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Mrs. Cummings joined the Company as Vice President - General Counsel in 1995 and
became Vice President - Administration and General Counsel in March 1996 and
Secretary in October 1997.
Mr. Derhofer joined Nutmeg Industries, Inc. in 1989 as Senior Vice President,
Chief Financial Officer and Treasurer. When Nutmeg was acquired by the Company
in 1994, he was named Executive Vice President and Chief Financial Officer of
the Nutmeg division. From October 1996 to September 2000, he was President of
the Knitwear division and was elected Vice President of the Company and Chairman
- - Imagewear Coalition in October 2000.
Mr. Lay joined the Company's Lee division in 1971 and held various positions at
both the Lee and Jantzen divisions, including Vice President - Product
Development at the Lee division from 1992 to 1994. In 1994, he was appointed
President - Wrangler Europe and later that year President - VF Europe. He served
as President of the Company's Lee division from August 1996 until he was elected
Vice President of the Company and Chairman - International Coalition in February
1999. He became the Chairman - International Jeanswear Coalition and was elected
Vice President - Global Processes in October 2000.
Mr. Pickard joined the Company in 1976 and was elected Assistant Controller in
1982, Assistant Treasurer in 1985, Treasurer in 1987 and Vice President -
Treasurer in 1994.
Mr. Schamberger joined the Company's Wrangler division in 1972 and held various
positions until his election as President of Wrangler in 1992. He was elected as
the Company's Chairman - North & South America Jeanswear and Workwear Coalitions
in 1995 and Vice President of the Company in 1995. Since October 2000, he has
been Chairman - North & South America Jeanswear Coalition and Chairman -
Playwear Coalition.
Mr. Shearer joined the Company in 1986 as Assistant Controller and was elected
Controller in 1989, Vice President - Controller in 1994 and Vice President -
Finance and Chief Financial Officer in July 1998.
Mr. Wiseman joined the Company in 1995 as Executive Vice President of Finance,
Operations and Manufacturing at the JanSport division. In January 1998 he became
President of the Bestform division and was elected Vice President of the
Company and Chairman - Global Intimate Apparel Coalition in October 2000.
PART II
ITEM 5. MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Information concerning the market and price history of the Company's Common
Stock, plus dividend information, as reported under the caption "Quarterly
Results of Operations" on page 22 and under the captions "Investor Information -
Common Stock, Shareholders of Record, Dividend Policy, Dividend Reinvestment
Plan, Dividend Direct Deposit and Quarterly Common Stock Price Information" on
page 37 of the 2000 Annual Report, is incorporated herein by reference.
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ITEM 6. SELECTED FINANCIAL DATA.
Selected financial data for the Company for each of its last five fiscal years
under the caption "Financial Summary" on pages 34 and 35 of the 2000 Annual
Report is incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
A discussion of the Company's financial condition and results of operations is
incorporated herein by reference to pages 17 to 20 of the 2000 Annual Report.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
A discussion of the Company's market risks is included in the section "Risk
Management" incorporated herein by reference to page 20 of the 2000 Annual
Report.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Financial statements of the Company, together with the report thereon of
PricewaterhouseCoopers LLP dated February 1, 2001, and specific supplementary
financial information are incorporated herein by reference to pages 21 through
33 of the 2000 Annual Report.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY.
Information under the caption "Election of Directors" on pages 3 through 6 of
the 2001 Proxy Statement is incorporated herein by reference. See Item 4A with
regard to Executive Officers.
Information under the caption "Section 16(a) Beneficial Ownership Reporting
Compliance" on page 31 of the 2001 Proxy Statement is incorporated herein by
reference.
ITEM 11. EXECUTIVE COMPENSATION.
Information on pages 13 through 19 of the 2001 Proxy Statement is incorporated
herein by reference.
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
Information under the caption "Certain Beneficial Owners" on page 21 and "Common
Stock Ownership of Management" on page 22 of the 2001 Proxy Statement is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Information under the caption "Election of Directors" with respect to Mr.
Crutchfield on page 3 and with respect to Mr. Hurst on page 4 the 2001 Proxy
Statement is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) The following documents are filed as a part of this report:
1. Financial statements - Included on pages 21 and 23 through 33 of the
2000 Annual Report (Exhibit 13) and incorporated by reference in Item
8:
Consolidated statements of income - - Fiscal years ended December 30,
2000, January 1, 2000 and January 2, 1999
Consolidated statements of comprehensive income - - Fiscal years ended
December 30, 2000, January 1, 2000 and January 2, 1999
Consolidated balance sheets - - December 30, 2000 and January 1, 2000
Consolidated statements of cash flows - - Fiscal years ended December
30, 2000, January 1, 2000 and January 2, 1999
Consolidated statements of common shareholders' equity - - Fiscal years
ended December 30, 2000, January 1, 2000 and January 2, 1999
Notes to consolidated financial statements
Report of independent accountants
2. Financial statement schedules - The following consolidated financial
statement schedule is included herein:
Schedule II - - Valuation and qualifying accounts
All other schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission are
not required under the related instructions or are inapplicable and
therefore have been omitted.
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3. Exhibits
Number Description
------ -----------
3 Articles of incorporation and bylaws:
(A) Articles of Incorporation, as amended and restated as of
April 18, 1986 (Incorporated by reference to Exhibit 3(A) to
Form 10-K for the year ended January 4, 1992)
(B) Articles of Amendment amending Article Fifth of the Amended
and Restated Articles of Incorporation (Incorporated by
reference to Exhibit 3(B) to Form 10-Q for the quarter ended
March 4, 1998)
(C) Statement with Respect to Shares of Series B ESOP
Convertible Preferred Stock (Incorporated by reference to
Exhibit 4.2 to Form 8-K dated January 22, 1990)
(D) Articles of Amendment with Respect to Designation of Series
A Participating Cumulative Preferred Stock (Incorporated by
reference to Exhibit 3(C) to Form 10-K for the year ended
January 3, 1998)
(E) Bylaws, as amended through April 20, 1999 and as presently
in effect (Incorporated by reference to Exhibit 3(E) to Form
10-K for the year ended January 1, 2000)
4 Instruments defining the rights of security holders, including
indentures:
(A) A specimen of the Company's Common Stock certificate
(Incorporated by reference to Exhibit 3(C) to Form 10-K for
the year ended January 3, 1998)
(B) A specimen of the Company's Series B ESOP Convertible
Preferred Stock certificate (Incorporated by reference to
Exhibit 4(B) to Form 10-K for the year ended December 29,
1990)
(C) Indenture between the Company and Morgan Guaranty Trust
Company of New York, dated January 1, 1987 (Incorporated by
reference to Exhibit 4.1 to Form S-3 Registration No.
33-10939)
(D) First Supplemental Indenture between the Company, Morgan
Guaranty Trust Company of New York and United States Trust
Company of New York, dated September 1, 1989 (Incorporated
by reference to Exhibit 4.3 to Form S-3 Registration No.
33-30889)
(E) Second Supplemental Indenture between the Company and United
States Trust Company of New York as Trustee (Incorporated by
reference to Exhibit 4.1 to Form 8-K dated April 6, 1994)
(F) Indenture between the Company and United States Trust
Company of New York, as Trustee, dated September 29, 2000
(Incorporated by reference to Exhibit 4.1 to Form 10-Q for
the quarter ended September 30, 2000)
(G) Form of 8.10% Note due 2005 (Incorporated by reference to
Exhibit 4.2 to Form 10-Q for the quarter ended September 30,
2000)
14
(H) Form of 8.50% Note due 2010 (Incorporated by reference to
Exhibit 4.3 to Form 10-Q for the quarter ended September 30,
2000)
(I) Rights Agreement, dated as of October 22, 1997, between the
Company and First Chicago Trust Company of New York
(Incorporated by reference to Exhibit 1 to Form 8-A dated
January 23, 1998)
(J) Amendment No. 1 to Rights Agreement dated as of January 28,
2000, between the Company and First Chicago Trust Company of
New York (Incorporated by reference to Exhibit 2 to Form 8-A
(Amendment No. 1) dated January 31, 2000)
10 Material contracts:
*(A) 1991 Stock Option Plan (Incorporated by reference to Exhibit
A to the 1992 Proxy Statement dated March 18, 1992)
*(B) 1995 Key Employee Restricted Stock Plan (Incorporated by
reference to Exhibit 10(U) to Form 10-K for the year ended
December 30, 1995)
*(C) 1996 Stock Compensation Plan, as amended (Incorporated by
reference to Exhibit 10(A) to Form 10-Q for the quarter
ended October 2, 1999)
*(D) Deferred Compensation Plan (Incorporated by reference to
Exhibit 10(F) to Form 10-K for the year ended January 1,
2000)
*(E) Executive Deferred Savings Plan, as amended and restated as
of September 1, 1999 (Incorporated by reference to Exhibit
10(G) to Form 10-K for the year ended January 1, 2000)
*(F) Second Amended Annual Benefit Determination under the
Amended and Restated Supplemental Executive Retirement Plan
for Mid-Career Senior Management (Incorporated by reference
to Exhibit 10(H) to Form 10-K for the year ended December
31, 1994)
*(G) Fourth Amended Annual Benefit Determination under the
Amended and Restated Supplemental Executive Retirement Plan
for Participants in the Company's Deferred Compensation Plan
(Incorporated by reference to Exhibit 10(J) to Form 10-K for
the year ended December 31, 1994)
*(H) Fifth Amended Annual Benefit Determination under the Amended
and Restated Supplemental Executive Retirement Plan which
funds certain benefits upon a Change in Control
(Incorporated by reference to Exhibit 10(K) to Form 10-K for
the year ended December 31, 1994)
*(I) Seventh Amended Annual Benefit Determination under the
Amended and Restated Supplemental Executive Retirement Plan
for Participants in the Company's Executive Deferred Savings
Plan (Incorporated by reference to Exhibit 10(L) to Form
10-K for the year ended December 31, 1994)
*(J) Eighth Amended Annual Benefit Determination under the
Amended and Restated Supplemental Executive Retirement Plan
for Participants whose Pension Plan
15
Benefits are limited by the Internal Revenue Code
(Incorporated by reference to Exhibit 10(M) to Form 10-K
for the year ended December 31, 1994)
*(K) Ninth Supplemental Annual Benefit Determination under the
Amended and Restated Supplemental Executive Retirement Plan
relating to the computation of benefits for Senior
Management (Incorporated by reference to Exhibit 10(O) to
Form 10-K for the year ended January 1, 2000)
*(L) Resolution of the Board of Directors dated December 3, 1996
relating to lump sum payments under the Company's
Supplemental Executive Retirement Plan (Incorporated by
reference to Exhibit 10(N) to Form 10-K for the year ended
January 4, 1997)
*(M) Form of Change in Control Agreement with senior management
of the Company (Incorporated by reference to Exhibit 10(J)
to Form 10-K for the year ended December 29, 1990)
*(N) Form of Change in Control Agreement with other management of
the Company (Incorporated by reference to Exhibit 10(K) to
Form 10-K for the year ended December 29, 1990)
*(O) Form of Change in Control Agreement with management of
subsidiaries of the Company (Incorporated by reference to
Exhibit 10(L) to Form 10-K for the year ended December 29,
1990)
*(P) Form of Amendment to Change of Control Agreements with
senior management and other management of the Company and
with management of subsidiaries of the Company (Incorporated
by reference to Exhibit 10(T) to Form 10-K for the year
ended January 1, 2000)
*(Q) Executive Incentive Compensation Plan (Incorporated by
reference to Exhibit 10(R) to Form 10-K for the year ended
December 31, 1994)
*(R) Restricted Stock Agreement (Incorporated by reference to
Exhibit 10(S) to Form 10-K for the year ended December 31,
1994)
*(S) VF Corporation Deferred Savings Plan for Non-Employee
Directors (Incorporated by reference to Exhibit 10(W) to
Form 10-K for the year ended January 4, 1997)
*(T) Mid-Term Incentive Plan, a subplan under the 1996 Stock
Compensation Plan (Incorporated by reference to Exhibit 10
(X) to Form 10-K for the year ended January 2, 1999)
*(U) Agreement and Release between the Company and Daniel G.
MacFarland
(V) Revolving Credit Agreement, dated July 15, 1999
(Incorporated by reference to Exhibit 10(B) to Form 10-Q for
the quarter ended October 2, 1999)
* Management compensation plans
16
13 Annual report to security holders
21 Subsidiaries of the Corporation
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Report of PricewaterhouseCoopers LLP
24 Power of attorney
All other exhibits for which provision is made in the applicable
regulations of the Securities and Exchange Commission are not required
under the related instructions or are inapplicable and therefore have
been omitted.
(b) Reports on Form 8-K:
A report on Form 8-K dated November 17, 2000 announced a series of
restructuring actions that could result in a pretax charge to fourth
quarter earnings of $120 to $140 million.
17
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Company has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
V.F. CORPORATION
By: /s/ Mackey J. McDonald
-------------------------
Mackey J. McDonald
Chairman of the Board
President
(Chief Executive Officer)
By: /s/ Robert K. Shearer
-------------------------------
March 22, 2001 Robert K. Shearer
Vice President - Finance
(Chief Financial Officer)
By: /s/ Robert A. Cordaro
--------------------------------
Robert A. Cordaro
Vice President - Controller
(Chief Accounting 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 Company and in
the capacities and on the dates indicated:
Erskine B. Bowles Director
Robert D. Buzzell* Director
Edward E. Crutchfield Director
Juan Ernesto de Bedout* Director
Ursula F. Fairbairn* Director
Barbara S. Feigin* Director March 22, 2001
George Fellows* Director
Daniel R. Hesse* Director
Robert J. Hurst* Director
W. Alan McCollough* Director
Mackey J. McDonald* Director
M. Rust Sharp* Director
* By:/s/ C. S. Cummings March 22, 2001
- -------------------------------------
C. S. Cummings, Attorney-in-Fact
18
VF CORPORATION
Schedule II - Valuation and Qualifying Accounts
- ------------------------------------------------------------------------------------------------------------------------
COL. A COL. B COL. C COL. D COL. E
- ------------------------------------------------------------------------------------------------------------------------
ADDITIONS
------------------------
(1) (2)
Charged to
Balance at Charged to Other Balance at
Beginning Costs and Accounts Deductions End of
Description of Period Expenses Describe Describe Period
- ------------------------------------------------------------------------------------------------------------------------
(Dollars in thousands)
Fiscal year ended December 30, 2000
Allowance for doubtful accounts $54,477 $13,497 $13,056 (A) $54,918
======= ======= =========== =======
Valuation allowance for deferred
income tax assets $46,526 $18,307 $7,800 (B) $57,033
======= ======= =========== =======
Fiscal year ended January 1, 2000
Allowance for doubtful accounts $52,011 $15,548 $13,082 (A) $54,477
======= ======= =========== =======
Valuation allowance for deferred
income tax assets $34,249 $22,523 $10,246 (B) $46,526
======= ======= =========== =======
Fiscal year ended January 2, 1999
Allowance for doubtful accounts $39,576 $20,802 $8,367 (A) $52,011
======= ======= =========== =======
Valuation allowance for deferred
income tax assets $32,506 $ 7,984 $6,241 (B) $34,249
======= ======= =========== =======
(A) Deductions include accounts written off, net of recoveries.
(B) Deductions relate to circumstances where it is more likely than not that
deferred tax assets will be realized.
VF CORPORATION
INDEX TO EXHIBITS
Number Description
------ -----------
10 Material Contracts:
(U) Agreement and Release between the Company and Daniel G. MacFarland
13 Annual report to security holders
21 Subsidiaries of the Corporation
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Report of PricewaterhouseCoopers LLP
24 Power of attorney