def14a
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY
STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities
Exchange Act of 1934 (Amendment
No. )
Filed by the Registrant x
Filed by a Party other than the
Registrant o
Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to Section
240.14a-11(c) or Section 240.14a-12
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VF CORPORATION
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement if
other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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No fee required. |
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Fee computed on table below per Exchange Act
Rules 14a-6(i)(1) and 0-11
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transaction computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and state how it was
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Check box if any part of the fee is offset as
provided by Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the previous filing
by registration statement number, or the Form or Schedule and the date of
its filing.
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Form Schedule or
Registration Statement No.: |
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VF CORPORATION
March 24, 2005
Dear Shareholder:
The Annual Meeting of Shareholders of VF Corporation will be
held on Tuesday, April 26, 2005, at the O.Henry Hotel,
Caldwell Room, 624 Green Valley Road, Greensboro, North
Carolina, commencing at 10:30 a.m. Your Board of Directors
and management look forward to greeting personally those
shareholders able to attend.
At the meeting, shareholders will be asked to (i) elect
four directors; (ii) ratify the selection of
PricewaterhouseCoopers LLP as VFs independent auditors for
fiscal 2005; and (iii) consider such other matters as may
properly come before the meeting.
Your Board of Directors recommends a vote FOR the election of
the persons nominated to serve as directors and FOR the
ratification of the selection of PricewaterhouseCoopers LLP as
VFs independent auditors. Regardless of the number of
shares you own or whether you plan to attend, it is important
that your shares be represented and voted at the meeting.
You may vote in person at the Annual Meeting or you may vote
your shares via the Internet, via a toll-free telephone number,
or by signing, dating and mailing the enclosed proxy card in the
postage-paid envelope provided, as explained on page 1 of
the attached proxy statement.
Your interest and participation in the affairs of VF are most
appreciated.
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Sincerely, |
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Mackey J. McDonald |
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Chairman, President and |
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Chief Executive Officer |
VF CORPORATION
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held April 26, 2005
March 24, 2005
To the Shareholders of VF CORPORATION:
The Annual Meeting of Shareholders of VF Corporation will be
held at the O.Henry Hotel, Caldwell Room, 624 Green Valley
Road, Greensboro, North Carolina, on Tuesday, April 26,
2005, at 10:30 a.m., for the following purposes:
(1) to elect four directors to hold office until the 2008
Annual Meeting of Shareholders;
(2) to ratify the selection of PricewaterhouseCoopers LLP
as VFs independent auditors for fiscal 2005; and
(3) to transact such other business as may properly come
before the meeting and any adjournments thereof.
A copy of VFs Annual Report for 2004 is enclosed for your
information.
Only shareholders of record as of the close of business on
March 8, 2005 are entitled to notice of and to vote at the
meeting.
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By Order of the Board of Directors |
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Candace S. Cummings |
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Vice President Administration, |
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General Counsel and Secretary |
YOUR VOTE IS IMPORTANT
You are urged to vote your shares via the Internet,
through
our toll-free telephone number or by signing, dating and
promptly returning your proxy in the enclosed envelope.
TABLE OF CONTENTS
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ABOUT THE MEETING
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What is the purpose of the Meeting?
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Who is entitled to vote at the Meeting?
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What are the voting rights of shareholders?
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How do shareholders vote?
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What constitutes a quorum?
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What are the Boards recommendations?
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What vote is required to approve each item?
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Other Information
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ITEM NO. 1 ELECTION OF DIRECTORS
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CORPORATE GOVERNANCE AT VF
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Corporate Governance
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Board of Directors
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Board Committees and Their Responsibilities
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Directors Compensation
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EXECUTIVE COMPENSATION
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COMPENSATION COMMITTEE REPORT
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SUMMARY COMPENSATION TABLE
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LONG-TERM INCENTIVE AWARDS
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EQUITY COMPENSATION PLAN INFORMATION TABLE
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FUTURE REMUNERATION
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PERFORMANCE GRAPH
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
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ITEM NO. 2 RATIFICATION OF THE SELECTION OF
INDEPENDENT AUDITORS
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OTHER INFORMATION
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APPENDIX A AUDIT COMMITTEE CHARTER
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APPENDIX B INDEPENDENCE STANDARDS OF THE BOARD OF
DIRECTORS
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VF CORPORATION
PROXY STATEMENT
For the 2005 Annual Meeting of Shareholders
This proxy statement is furnished in connection with the
solicitation of proxies by the Board of Directors of VF
Corporation to be voted at VFs Annual Meeting of
Shareholders on April 26, 2005 and any adjournments of the
meeting (the Meeting).
ABOUT THE MEETING
What is the purpose of the Meeting?
At the Meeting, holders of VF Common Stock and Series B
ESOP Convertible Preferred Stock (Series B ESOP
Stock) will act upon the matters described in the notice
of the Meeting on the front page of this proxy statement,
including the election of four directors, ratification of the
selection of PricewaterhouseCoopers LLP as VFs independent
auditors for fiscal 2005, and transaction of such other business
as may properly come before the Meeting.
Who is entitled to vote at the Meeting?
Only shareholders of record on March 8, 2005, the record
date for the Meeting, are entitled to receive notice of and vote
at the Meeting.
What are the voting rights of shareholders?
Each share of Common Stock is entitled to one vote and each
share of Series B ESOP Stock is entitled to two votes on
each matter considered at the Meeting.
How do shareholders vote?
Shareholders may vote at the Meeting in person or by proxy.
Proxies validly delivered by shareholders (by Internet,
telephone or mail as described below) and received by VF prior
to the Meeting will be voted in accordance with the instructions
contained therein. If a shareholders proxy card gives no
instructions, it will be voted in accordance with the
recommendation of the Board of Directors. A shareholder may
change any vote by proxy before the proxy is exercised by filing
with the Secretary of VF either a notice of revocation or a duly
executed proxy bearing a later date or by attending the Meeting
and voting in person. Shareholders who vote by telephone or the
Internet may also change their votes by re-voting by telephone
or the Internet within the time periods listed below. A
shareholders latest vote, including via the Internet or
telephone, is the one that is counted.
There are three ways to vote by proxy:
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1) BY INTERNET: Visit the web site
http://www.eproxyvote.com/vfc. To vote your shares, you must
have your proxy/voting instruction card in hand. The web site is
available 24 hours a day, seven days a week, and will be
accessible UNTIL 11:59 p.m., Eastern Daylight Time, on
April 25, 2005; |
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2) BY TELEPHONE: Call toll-free 1-877-PRXVOTE
(1-877-779-8683). Shareholders outside of the U.S. and Canada
should call 1-201-536-8073. To vote your shares, you must have
your proxy/voting instruction card in hand. Telephone voting is
accessible 24 hours a day, seven days a week, UNTIL
11:59 p.m., Eastern Daylight Time, on April 25,
2005; or |
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3) BY MAIL: Mark your proxy/voting instruction card,
date and sign it, and return it in the postage-paid
(U.S. only) envelope provided. If the envelope is missing,
please address your completed proxy/ voting instruction card to
VF Corporation, c/o EquiServe Trust Company, N.A.,
P.O. Box 8099, Edison, New Jersey 08818-8099. |
IF YOU VOTE BY INTERNET OR TELEPHONE, YOU NEED
NOT RETURN YOUR PROXY/VOTING INSTRUCTION CARD.
If you are a beneficial owner, please refer to your proxy card
or other information forwarded by your bank, broker or other
holder of record to see which of the above choices are available
to you.
What constitutes a quorum?
Shareholders entitled to cast at least a majority of the votes
that all shareholders are entitled to cast must be present at
the Meeting in person or by proxy to constitute a quorum for the
transaction of business. At the close of business on
March 8, 2005, there were 113,445,236 outstanding
shares consisting of 112,632,510 shares of Common Stock and
812,726 shares of Series B ESOP Stock. Holders of
these outstanding shares are entitled to cast
114,257,962 votes at the Meeting.
What are the Boards recommendations?
The Board recommends a vote FOR the election of the four
nominees proposed for election as directors and FOR ratification
of the selection of PricewaterhouseCoopers LLP as VFs
independent auditors for fiscal 2005. If any other matters are
brought before the Meeting, the proxy holders will vote as
recommended by the Board of Directors. If no recommendation is
given, the proxy holders will vote in their discretion. At the
date of this proxy statement, we do not know of any other matter
to come before the Meeting. Persons named as proxy holders on
the accompanying form of proxy/voting instruction card are
Mackey J. McDonald, Chairman, President and Chief Executive
Officer of VF, and Candace S. Cummings, Vice
President-Administration, General Counsel and Secretary of VF.
What vote is required to approve each item?
The four nominees for election as directors who receive the
greatest number of votes will be elected directors. Ratification
of the selection of PricewaterhouseCoopers LLP as VFs
independent auditors for fiscal 2005 requires the affirmative
vote of a majority of the votes cast on such matter at the
Meeting. Shares of Common Stock and shares of Series B ESOP
Stock will vote together as a single class. Withheld votes,
abstentions and broker non-votes will not be taken into account
in determining the outcome of the election of directors or
ratification of the selection of PricewaterhouseCoopers LLP as
VFs independent auditors for fiscal 2005.
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Other Information
A copy of VFs Annual Report for the fiscal year ended
January 1, 2005 accompanies this proxy statement. No
material contained in the Annual Report is to be considered a
part of the proxy solicitation material.
VFs mailing address is P.O. Box 21488, Greensboro,
North Carolina 27420. This proxy statement and the form of
proxy/ voting instruction card were first mailed or given to
security holders on approximately March 24, 2005.
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ITEM NO. 1
ELECTION OF DIRECTORS
VFs Board of Directors has nominated the four persons
named below to serve as directors until the 2008 Annual Meeting.
The persons named in the accompanying form of proxy/voting
instruction card intend to vote such proxy for the election as
directors of the following nominees. If any nominee becomes
unable or unwilling to serve as a director, the proxy holders
will vote for such other person or persons as may be nominated
by the Board of Directors. The nominees named below have
indicated that they are willing to serve if reelected to the VF
Board. The Board of Directors may fill vacancies in the Board,
and any director chosen to fill a vacancy would hold office
until the next election of the class for which such director had
been chosen. It is the policy of VF that a substantial majority
of the members of its Board of Directors should be independent.
Currently, 11 of VFs 12 directors have been
determined by the Board to be independent in accordance with
standards adopted by the Board, as set forth in the Boards
Corporate Governance Principles and as attached hereto as
Appendix B, and the Listing Standards of the New York Stock
Exchange, the principal securities exchange on which VFs
Common Stock is traded.
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Year in Which | |
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Principal Occupation |
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To Serve Until the
2008 Annual Meeting |
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Juan Ernesto de Bedout, 60
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Group President Latin American Operations, Kimberly-Clark
Corporation |
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2000 |
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Ursula O. Fairbairn, 62
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Executive Vice President Human Resources &
Quality, American Express Company |
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1994 |
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Barbara S. Feigin, 67
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Consultant |
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1987 |
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Mackey J. McDonald, 58
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Chairman of the Board, President, and Chief Executive Officer of
VF |
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1993 |
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Mr. de Bedout has served as Group President of Latin
American Operations for Kimberly-Clark Corporation, a global
personal care products and tissue company, responsible for
business units in Central and South America as well as the
Caribbean, since 1999. He is a member of the Audit and Finance
Committees of the Board of Directors.
Mrs. Fairbairn has served as Executive Vice
President Human Resources & Quality of
American Express Company, a financial services company, since
1996. Mrs. Fairbairn also serves as a director of Air
Products and Chemicals, Inc. and Sunoco, Inc. She is a member of
the Executive and Compensation Committees of the Board of
Directors. (Also see Security Ownership of Certain
Beneficial Owners and Management.)
Mrs. Feigin has been a Consultant specializing in strategic
marketing and branding since 1999. She served as Executive Vice
President and Worldwide Director of Strategic Services of Grey
Advertising Inc. from 1983 until her retirement from that
position in 1999.
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Mrs. Feigin also serves as a director of Circuit City
Stores, Inc. She is a member of the Audit and Nominating and
Governance Committees of the Board of Directors.
Mr. McDonald joined VFs Lee division in 1983. He
served in various managerial positions with VFs
subsidiaries until 1991 when he was named a VF Group Vice
President. Mr. McDonald was elected President and a
director of VF in 1993 and Chief Executive Officer in 1996. He
has served as Chairman, President, and Chief Executive Officer
of VF since 1998. He is a director of Wachovia Corporation,
Hershey Foods Corporation, and, since November 2002, Tyco
International Ltd. Mr. McDonald is Chairman of the
Executive Committee and serves as an ex officio member of
all other committees of the Board, except the Audit, Nominating
and Governance and Compensation Committees.
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Directors Whose Terms
Expire at the 2007
Annual Meeting |
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Edward E. Crutchfield, 63
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Retired; Former Chairman and Chief Executive Officer, First
Union Corporation |
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1992 |
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George Fellows, 62
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Consultant to Investcorp International, Inc. |
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1997 |
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Daniel R. Hesse, 51
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Former Chairman, President and Chief Executive Officer, Terabeam
Corporation |
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1999 |
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Clarence Otis, Jr., 48
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Chief Executive Officer of Darden Restaurants, Inc. |
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2004 |
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Mr. Crutchfield served as the Chairman and Chief Executive
Officer of First Union Corporation (now known as Wachovia
Corporation), a banking and financial services company, from
1985 until his retirement in 2000. Mr. Crutchfield serves
as a director of The Liberty Corp., a television broadcasting
company. He is a member of the Executive, Compensation and
Finance Committees of the Board of Directors.
Mr. Fellows has served as a Consultant to Investcorp
International, Inc. and other private equity firms since 2000.
Previously, Mr. Fellows served as President and Chief
Executive Officer of Revlon, Inc. and of Revlon Consumer
Products Corporation from 1997 through 1999. He is a member of
the Audit and Nominating and Governance Committees of the Board
of Directors.
Mr. Hesse served as the Chairman, President and Chief
Executive Officer of Terabeam Corporation, a telecommunications
company, from 2000 until 2004. Previously, Mr. Hesse was
President and Chief Executive Officer of AT&T Wireless
Services. He also served as an Executive Vice President of
AT&T. He is a member of the Finance and Compensation
Committees of the Board of Directors.
Mr. Otis has been the Chief Executive Officer of Darden
Restaurants, Inc. since December 2004. Previously, he served as
the Executive Vice President of Darden Restau-
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rants, Inc., and President of its Smokey Bones Restaurants
division, from December 2002 until December 2004. He served as
Executive Vice President and Chief Financial Officer of Darden
Restaurants from April 2002 to December 2002, Senior Vice
President and Chief Financial Officer from 1999 to 2002 and
Senior Vice President, Finance and Treasurer from 1997 to 1999.
Mr. Otis is a director of Darden Restaurants, Inc. and St.
Pauls Travelers Property Casualty Corp., a property
casualty insurance company. He is a member of the Audit and
Nominating and Governance Committees of the Board of Directors.
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Directors Whose Terms Expire at the 2006 Annual Meeting |
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Robert J. Hurst, 59
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Senior Advisor, Crestview Partners LLC |
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1994 |
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W. Alan McCollough, 55
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Chairman and Chief Executive Officer, Circuit City Stores, Inc |
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2000 |
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M. Rust Sharp, 64
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Of Counsel to Heckscher, Teillon, Terrill & Sager
(Attorneys) |
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1984 |
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Raymond G. Viault, 60
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Retired Vice Chairman, General Mills, Inc |
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2002 |
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Mr. Hurst has been Senior Advisor to Crestview Partners
LLC, a private equity firm, since 2004. Previously, he was Vice
Chairman of The Goldman Sachs Group, Inc., an international
investment banking and securities firm. Mr. Hurst is a
member of the Executive and Finance Committees of the Board of
Directors.
Mr. McCollough has served as Chairman and Chief Executive
Officer of Circuit City Stores, Inc. since 2002. He also served
as President of the company from 2002 until 2005. In 2000, he
was elected to the companys board of directors and added
the title of Chief Executive Officer. From 1997 to June 2000, he
was President and Chief Operating Officer of Circuit City.
Mr. McCollough is a member of the Compensation and
Nominating and Governance Committees of the Board of Directors.
Mr. Sharp has been Of Counsel to Heckscher, Teillon,
Terrill & Sager, a law firm located in West
Conshohocken, Pennsylvania, since 1999. He was Of Counsel to
Pepper Hamilton LLP, a national law firm headquartered in
Philadelphia, Pennsylvania, from 1996 to 1999. Mr. Sharp is
a member of the Executive and Compensation Committees of the
Board of Directors. (Also see Security Ownership of
Certain Beneficial Owners and Management.)
Mr. Viault was Vice Chairman of General Mills, Inc. with
responsibility for General Mills Meals, Baking Products,
Pillsbury USA and Bakeries and Foodservice businesses until his
retirement in January 2005. Mr. Viault joined General Mills
as Vice Chairman in 1996. Mr. Viault also serves as a
director of Safeway Inc., a food and drug retailer in North
America, and of Newell Rubbermaid Inc., a consumer products
company. He is a member of the Audit and Nominating and
Governance Committees of the Board of Directors.
6
CORPORATE GOVERNANCE AT VF
As provided by the Pennsylvania Business Corporation Law and
VFs By-Laws, VFs business is managed under the
direction of its Board of Directors. Members of the Board are
kept informed of VFs business through discussions with the
Chairman, President and CEO and other officers, by reviewing
VFs annual business plan and other materials provided to
them and by participating in meetings of the Board and its
committees. In addition, to promote open discussion among the
independent directors, those directors meet in regularly
scheduled executive sessions without management present. The
chairs of the Nominating and Governance, Audit and Compensation
Committees of the Board preside at meetings or executive
sessions of non-management directors on a rotating basis.
Corporate Governance
VFs Board of Directors has a long-standing commitment to
sound and effective corporate governance practices. A foundation
of VFs corporate governance is the Boards policy
that a substantial majority of the members of the Board should
be independent. This policy is included in the Boards
written Corporate Governance Principles, which, in addition to
director independence, address a number of other important
governance issues such as qualifications for Board membership;
mandatory retirement for Board members at age 70; a
requirement that directors submit their resignation for
consideration upon a substantial change in principal occupation
or business affiliation; Board leadership; committee
responsibilities; authority of the Board to engage outside
independent advisors as they deem appropriate; succession
planning for the chief executive officer; and annual Board
self-evaluation. In addition, the Board of Directors has for
many years had in place formal charters setting forth the powers
and responsibilities of each of its committees. The Boards
Corporate Governance Principles, the Audit, Nominating and
Governance, Compensation and Finance Committee charters, code of
business conduct and ethics applicable to the principal
executive officer, the principal financial officer, and the
principal accounting officer as well as other employees and all
directors of VF, and other corporate governance information are
available on VFs web site (www.vfc.com) and will be
provided to any shareholder upon request directed to the
Secretary of VF at P.O. Box 21488, Greensboro, North
Carolina 27420. In addition, the Audit Committee charter is
attached hereto as Appendix A. Anyone wishing to
communicate directly with the non-management members of the
Board of Directors (including the directors who preside at
meetings or executive sessions of non-management directors) may
contact the Chairman of the Nominating and Governance Committee,
c/o the Secretary of VF at the address set forth in the
preceding sentence, or call the VF Ethics Helpline at
1-877-285-4152 or send an email message to www.corpgov@vfc.com.
Management has reviewed internally and with the Board of
Directors the provisions of the Sarbanes-Oxley Act of 2002, the
related rules of the Securities and Exchange Commission and the
New York Stock Exchange Listing Standards regarding corporate
governance policies and procedures. We believe that the
Boards Corporate Governance Principles and committee
charters meet these requirements.
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Board of Directors
In accordance with VFs By-Laws, the Board of Directors has
set the number of directors at 12. Eleven of VFs directors
are non-employee directors. The Board considered transactions
and relationships between each director and members of his or
her immediate family and VF and determined that 11 of VFs
12 directors are free of any material relationship with VF,
other than their service as directors, and are
independent directors under the New York Stock
Exchange Listing Standards and the categorical standards adopted
by the Board which are part of the Corporate Governance
Principles and which are attached hereto as Appendix B.
During 2004, VFs Board of Directors held seven meetings.
Under VFs Corporate Governance Principles, directors are
expected to attend all meetings of the Board, all meetings of
committees of which they are members and the annual meetings of
shareholders. Every member of the Board attended at least 75% of
the total number of meetings of the Board and all committees on
which he or she served, and every member of the Board attended
the annual meeting of shareholders in 2004.
Board Committees and Their Responsibilities
The Board has Executive, Audit, Finance, Nominating and
Governance, and Compensation Committees. The Board has
determined that each of the members of the Audit, Nominating and
Governance and Compensation Committees is independent. Each of
these committees is governed by a written charter approved by
the Board of Directors. Each is required to perform an annual
self-evaluation and each committee may engage outside
independent advisors as the committee deems appropriate.
Following is a brief description of the responsibilities of the
Audit, Finance, Nominating and Governance and Compensation
Committees.
Audit Committee: The Audit Committee monitors and makes
recommendations to the Board concerning the financial policies
and procedures to be observed in the conduct of VFs
affairs. Its duties include (1) selecting the independent
auditors for VF, (2) reviewing the scope of the audit to be
conducted by the independent auditors, (3) meeting with the
independent auditors concerning the results of their audit and
VFs selection and disclosure of critical accounting
policies, (4) reviewing with management and the independent
auditors our annual and quarterly statements prior to filing
them with the Securities and Exchange Commission,
(5) overseeing the scope and adequacy of VFs system
of internal accounting controls and (6) preparing a report
to shareholders annually for inclusion in the proxy statement.
The Audit Committee is the principal liaison between the Board
of Directors and the independent auditors for VF.
As of the date of this proxy statement, the members of the
committee are Messrs. Fellows (Chairman), de Bedout, Otis
and Viault and Ms. Feigin. The committee held ten meetings
during 2004. The Board of Directors has determined that all of
the members of the Committee are independent as independence for
audit committee members is defined in the New York Stock
Exchange Listing Standards and are financially literate and that
Messrs. Fellows, Otis and Viault qualify as audit
committee financial experts in accordance with the
definition of audit committee financial expert set
forth in the
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Securities and Exchange Commission regulations and have
accounting and related financial management expertise within the
meaning of the Listing Standards of the New York Stock Exchange.
Messrs. Fellows, Otis and Viault acquired those attributes
through acting as or actively overseeing a principal financial
officer or principal accounting officer of a public company.
Each of them has experience overseeing or assessing the
performance of companies with respect to the evaluation of
financial statements in their roles as chairman and chief
executive officer, vice chairman or president of a public
company. In addition to his service as vice chairman of General
Mills, Mr. Viault acted as chief financial officer of
General Mills for two years and currently serves on the audit
committee of another public company.
Finance Committee: The Finance Committee monitors and
makes recommendations to the Board concerning the financial
policies and procedures of VF. The responsibilities of the
committee include reviewing and recommending to the Board
actions concerning (1) dividend policy, (2) changes in
capital structure, including debt or equity issuances,
(3) the financial aspects of proposed acquisitions or
divestitures, and (4) VFs annual capital expenditure
budgets and certain capital projects. As of the date of this
proxy statement, the members of the committee are
Messrs. Crutchfield (Chairman), de Bedout, Hesse and Hurst.
The committee held five meetings during 2004.
Nominating and Governance Committee: The responsibilities
of the Nominating and Governance Committee include
(1) screening potential candidates for director and
recommending candidates to the Board of Directors,
(2) recommending to the Board a succession plan for the
Chairman of the Board and Chief Executive Officer, and
(3) reviewing and recommending to the Board governance
policies and principles for VF. The committee generally
identifies nominees for director by engaging a third party
search firm whose function is to assist in the identification of
potential nominees. The search firm is paid a fee for its
services. Candidates are selected for their character, judgment,
business experience and acumen. The committee will consider
suggestions received from shareholders regarding nominees for
election as directors, which should be submitted to the
Secretary of VF. If the committee does not recommend a nominee
proposed by a shareholder for election as a director, then the
shareholder seeking to propose the nominee would have to follow
the formal nomination procedures set forth in VFs By-Laws.
VFs By-Laws provide that a shareholder may nominate a
person for election as a director if written notice of the
shareholders intent to nominate a person for election as a
director is received by the Secretary of VF (1) in the case
of an annual meeting, not less than 150 days prior to the
date of the annual meeting or (2) in the case of a special
meeting at which directors are to be elected, not later than
seven days following the day on which notice of the meeting was
first mailed to shareholders. The notice must contain specified
information about the shareholder and the nominee, including
such information as would be required to be included in a proxy
statement pursuant to the rules and regulations established by
the Securities and Exchange Commission under the Securities
Exchange Act of 1934 (the 1934 Act). The
committees policy with regard to consideration of any
potential director is the same for candidates recommended by
shareholders and candidates identified by other means. As of the
date of this proxy statement, the members of the committee are
Mrs. Feigin (Chairman) and Messrs. Fellows,
McCollough, Otis and Viault. The committee held four meetings
during 2004.
9
Compensation Committee: The Compensation Committee
reviews VFs compensation and benefits programs to target
such compensation and benefits to be competitive with
compensation and benefits paid to executives in comparable
positions within a comparison group of companies based on
targeted performance goals established by the Committee,
considers VFs organizational structure, including
management development and succession, except for the Chairman
of the Board and Chief Executive Officer, and makes
recommendations to the Board regarding such programs and
structure. This committee also has responsibility for
(1) reviewing and recommending to the Board salary and
incentive compensation for VFs Chief Executive Officer and
other executive officers, (2) setting performance goals
under VFs incentive compensation programs and
(3) preparing a report to shareholders annually for
inclusion in the proxy statement. The members of the committee
are Mrs. Fairbairn (Chairman) and Messrs. Crutchfield,
Hesse, McCollough and Sharp. The committee held four meetings
during 2004.
Directors Compensation
Directors compensation increased for 2005. Effective
January 1, 2005, each director other than Mr. McDonald
receives an annual stipend of $45,000 (up from $35,000 in 2004),
payable in quarterly installments, plus a fee of $1,250 for each
Board meeting attended (up from $1,000 in 2004). Each director
who serves on a committee is paid $1,250 for each meeting
attended (up from $1,000 in 2004). Each director serving as
chairman of a committee also receives an additional stipend of
$5,000 per year (unchanged from 2004). Each director is
paid $1,000 per day (unchanged from 2004) for special
assignments in connection with Board or committee activity as
designated by the Chairman of the Board. Travel and lodging
expenses are reimbursed. Mr. McDonald, the only director
who is also an employee of VF, does not receive any compensation
in addition to his regular compensation for attendance at
meetings of the Board or any of its committees. Each director
may elect to defer all or part of his or her stipend and fees
into equivalent units of VF Common Stock under the VF Deferred
Savings Plan for Non-Employee Directors. All Common Stock
equivalent units receive dividend equivalents. Deferred sums,
including Common Stock equivalent units, are payable in cash to
the participant upon termination of service or such later date
specified in advance by the participant. Eight directors elected
to defer compensation in 2004. VF does not provide pension,
medical or life insurance benefits to its non-employee
directors. Directors traveling on VF business are covered by
VFs business travel accident insurance policy which
generally covers all VF employees and directors.
In order to link compensation of directors to VFs stock
performance, each director is eligible to receive grants of
non-qualified stock options to purchase shares of Common Stock
and restricted awards (restricted stock or restricted stock
units) under VFs 1996 Stock Compensation Plan. Currently,
stock options are granted to non-employee directors at a rate of
5,400 per year (up from 4,800 in 2004). Such options have
an exercise price equal to fair market value at the date of
grant, have a stated term of ten years and become exercisable
one year after the date of grant. Options are exercisable only
so long as the optionee remains a director of VF except that,
subject to earlier expiration of the option term, options remain
exercisable for 36 months after the directors
retirement or death and not less than 12 months after
termination due to disability. It is VFs policy to
strongly encourage stock ownership by VF directors to closely
align the interests of management and shareholders. Accordingly,
directors are required to accumulate, over a specific period
10
of time, and then retain, shares having a fair market value
equal to three times their annual retainer.
Each director is eligible to participate in VFs matching
gift program for institutions of higher learning and National
Public Television and Radio up to an aggregate of
$10,000 per year.
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE REPORT
The Compensation Committee (the Committee) reports
as follows with respect to compensation of executive officers
for the fiscal year ended January 1, 2005:
Principles of Executive Compensation Program
The goals of VFs Executive Compensation Program (the
Program) are to attract and retain highly competent
executives, to provide incentives for achieving and exceeding
VFs short-term and long-term financial goals and to align
the financial objectives of VFs executives with those of
its shareholders, both in the short and long term.
The Program incorporates three compensation objectives. First,
the Program seeks to offer total compensation that is
competitive with other large U.S.-based companies with which VF
may compete for executive talent. Second, the Program aims to
provide annual incentives to executives based on corporate and
individual performance and to reward superior performance with
superior levels of compensation. Third, the Program seeks to
maximize long-term total shareholder return by providing
executives with incentives tied to stock ownership and value,
thus aligning interests of shareholders and executives. VF
balances each of the Programs objectives by establishing
target compensation levels for executive pay that are achieved
through a combination of base salary, annual cash incentives and
long-term incentives consisting of performance-contingent Common
Stock units and stock options.
VFs philosophy is that a significant portion of each
executives total compensation should be at-risk based on
VFs financial performance. The at-risk components of total
compensation are progressively greater for higher level
positions. For 2004, the at-risk components of the targeted cash
compensation and performance-contingent Common Stock unit
packages ranged from 75% for the Chief Executive Officer to
between 64% and 68% for the other executive officers named in
this proxy statement. Stock options, which are not included in
these at-risk calculations, are completely at risk because they
have no value to recipients unless the stock price appreciates
above the exercise price during the period in which the option
is exercisable.
Competitive Compensation Targets
Total compensation targets, consisting of base salary, annual
incentive awards and long-term incentive awards, are set
annually for designated management positions. The Committee used
information provided by Towers Perrin, its outside compensation
consultant, regarding its executive compensation database, which
includes executive compensa-
11
tion data for over 500 large U.S.-based companies (the
Comparison Group), as well as information about
companies within the S&P 1500 Apparel,
Accessories & Luxury Goods Index to establish
compensation targets for 2004. In general, VF targets total
direct compensation for each VF executive officer to be
competitive with compensation paid to executives in comparable
positions within VFs Comparison Group based on targeted
performance goals established by the Committee. Benefits and
indirect compensation are set at levels intended to be
competitive but are not included in the Committees
evaluation of total direct compensation.
Base Salary: Salary ranges and individual salaries for
senior executives are reviewed annually by the Committee. In
determining individual salaries, the Committee considers the
scope of job responsibilities, individual contribution,
VFs salary budget, labor market conditions and current
compensation, as compared to market practice, based on guidance
provided by the Committees outside compensation consultant.
Annual Incentives: Under the VF Executive Incentive
Compensation Plan (EIC Plan), performance goals are
set each year by the Committee. In 2004, performance goals were
based on VFs reported earnings per share (excluding the
effects of extraordinary and non-recurring items) and net sales.
The Committee establishes a fixed percentage of the mid-point of
each executives salary grade as the executives
targeted annual incentive opportunity under the EIC Plan.
Depending upon the level of achievement of the performance goal,
annual cash awards could range from 0% to 200% of the targeted
incentive opportunity for each EIC Plan participant. For the
years 2002, 2003 and 2004, awards under the EIC Plan have ranged
between 98% and 180% of the targeted incentive opportunity. The
maximum individual award is $3,000,000 plus the amount of the
participants unused annual limit as of the close of the
previous year. The Committee may exercise discretion to reduce
awards under the EIC Plan generally or for any individual
participant. While it is the policy of the Committee to provide
opportunities for annual incentive compensation for achievement
of pre-established performance goals based primarily on
financial measures, the Committee also retains discretion to pay
bonuses apart from the EIC Plan reflecting its subjective
assessment of the valuable accomplishments of VFs
executive officers which, in the Committees view, cannot
always be anticipated in advance or reflected in such
pre-established goals.
Long-Term Incentives: Long-term incentives consist of
performance-contingent Common Stock units and stock options.
Under VFs Mid-Term Incentive Plan (implemented under the
VF 1996 Stock Compensation Plan) as in effect for the three-year
performance cycle 2002-2004, performance-contingent Common Stock
units could be awarded by the Committee if VFs average
total shareholder return (Common Stock price change plus
dividend yield) for the three-year performance period compared
favorably to that of a performance peer group, or alternatively,
if a specified increase in earnings per share was achieved in
the last year of the performance period. For the three-year
performance period ended December 31, 2004, the performance
peer group consisted of 15 companies significantly engaged
in the apparel industry. Depending on the level of achievement
of the performance goal, each participant may earn from 0% to
200% of the number of performance-contingent Common Stock units,
plus dividend equivalents, targeted by the Committee. For the
years 2002, 2003 and 2004,
12
pay-outs have ranged from 50% to 95% of the targeted number of
performance-contingent Common Stock units. Awards are paid in
shares of VF Common Stock. At the election of a participant,
receipt of awards may be deferred until retirement or until
dates specified by the participant.
For three-year performance cycles beginning in 2004 and
thereafter, awards under the 2004 Mid-Term Incentive Plan will
depend on the level of achievement of performance goals set by
the Committee at the beginning of each performance cycle.
Stock options are typically granted annually under the VF 1996
Stock Compensation Plan. Non-qualified stock options have a
stated term of ten years and become exercisable not less than
one year after the date of grant. Options are exercisable only
so long as the option holder remains an employee of VF or its
subsidiaries, except that, subject to earlier expiration of the
option term, and to the specific terms and definitions contained
in the Stock Compensation Plan, options generally remain
exercisable during the period severance payments (if any) are
made in the case of involuntary termination of employment, for
36 months after death or retirement under the VF Pension
Plan, or not less than 12 months after termination of
employment due to disability. The Committee determines a value
of options granted to executive officers as a component of the
total targeted compensation. This value is based on an accepted
valuation methodology.
The size of individual grants of performance-contingent Common
Stock units and options generally increase with the level of
responsibility of the executive officer. The grants to each
executive officer named in this proxy statement also depend upon
the Committees assessment of the individuals
performance. The Committee does not assign specific weighting to
these factors.
Stock Ownership Commitment. It is VFs policy to
strongly encourage stock ownership by VF senior management. This
policy closely aligns the interests of management with those of
the shareholders. Senior executives are subject to share
ownership guidelines that require that they accumulate, over a
specific period of time, and then retain, shares of VF Common
Stock having a market value ranging from one to five times
annual base salary, depending upon the position. The Chief
Executive Officer is required to accumulate VF Common Stock
having a market value equal to five times his annual base salary
and the other named executive officers equal to three times
their annual base salary. Until the targeted ownership level is
met, each senior executive is expected to hold shares equal to
50% of the notional after-tax value of each option exercised.
Summary of Actions Taken by the Compensation Committee
2004 Base Salary Increases
At its February 2004 meeting, the Committee approved salary
increases to be effective as of January 1, 2004. The base
salary increase for each executive officer was based on
(i) the Committees adjustment of the executives
salary grade range, if appropriate, based on market guidance
provided by the Committees outside compensation
consultant, (ii) the Committees assessment of the
individuals salary within his or her salary grade based on
the individuals performance and (iii) VFs
overall merit increase budget for 2004 of approximately 3% for
salaries of senior employees after adjustment for salary range
13
changes. During 2004, Mr. Lay, Mr. Shearer and
Mr. Wiseman received interim salary adjustments
commensurate with changes in their job responsibilities.
Annual Incentive Awards
At its February 2004 meeting, the Committee established the 2004
EIC Plan performance target and the targeted annual incentive
awards for each participating executive as described above. At
its February 2005 meeting, the Committee granted EIC Plan awards
to the named executive officers based on the level of
achievement of the EIC Plan performance target for 2004,
resulting in pay-outs of up to 180% of the targeted awards.
Long-Term Incentive Awards
At its February 2004 meeting, the Committee reviewed VFs
philosophy with respect to stock option grants. In order to
instill an entrepreneurial spirit among its employees, it is
VFs practice to grant options to a significant number of
management-level employees. In 2004, stock options were granted
to 503 management-level employees. The stock options awarded to
the named executive officers were based on the Committees
assessment of the individuals total compensation from a
competitive perspective, within the guidelines established by
the Committee, and the executives performance.
At the February 2004 meeting, the Committee established target
awards for the 87 participants in the Mid-Term Incentive Plan
for the 2004-2006 performance cycle. At the February 2005
meeting, the Committee approved awards to the 29 participants in
the Mid-Term Incentive Plan for the three-year performance
period 2002-2004. These awards were based on the level of
achievement of the total shareholder return over the performance
period. Executive officer participants were awarded 50% of the
target number of Common Stock units potentially earnable under
the Plan for the 2002-2004 performance period.
Compensation of the Chief Executive Officer
The fiscal year 2004 compensation for Mr. McDonald,
VFs Chief Executive Officer, consisted of base salary, an
annual incentive award and long-term incentive awards. The
Committee determined the level for each of these elements using
methods consistent with those used for other senior executives.
Mr. McDonalds base salary remained $990,000 in 2004.
In determining Mr. McDonalds 2004 annual incentive
award the Committee evaluated his performance by considering
VFs strong financial and operating performance for fiscal
2004. The Committee noted, among other things, that from 2003 to
2004 VFs sales increased 16% to $6,054.5 million, net
income rose 19% to $474.7 million and earnings per share
rose 17% to $4.21, all well above performance targets for the
year. The Committee also considered Mr. McDonalds
personal performance against pre-established objectives in a
number of areas, including building lifestyle brands, sales
growth, stretching brands and customers to new geographies,
leveraging VFs supply chain capabilities and leadership
development. The Committee reported on this evaluation to the
other members of the Board of Directors.
14
Based on the foregoing evaluation and the level of achievement
of the EIC Plan performance target for 2004, Mr. McDonald
received an annual incentive award of $1,985,000 for 2004.
Mr. McDonald was granted options for 213,400 shares of
VF Common Stock in 2004 based on the Committees assessment
of competitor compensation data, together with the projection of
total targeted compensation within the guidelines described
above, and the Committees assessment of
Mr. McDonalds performance.
Mr. McDonald was awarded 3,629 shares of Common Stock
for the 2002-2004 performance period under the Mid-Term
Incentive Plan. The basis for this pay-out is described above.
Mr. McDonalds target award under the Mid-Term
Incentive Plan for the 2004-2006 performance cycle was set at
67,800 shares. As in the case of other long-term incentive
awards, this grant level was determined based on the
Committees projection of total targeted compensation
within the guidelines described above and the Committees
assessment of Mr. McDonalds performance.
At their February 2005 meetings, the Board of Directors
increased Mr. McDonalds salary to $1,100,000, and the
Committee granted him options to purchase 250,000 shares of
VF Common Stock, set his target award under the Mid-Term
Incentive Plan for the 2005-2007 performance cycle at 50,100
shares, and awarded him 10,000 restricted stock units.
The Committee has reviewed all components of
Mr. McDonalds compensation, including salary, bonus,
equity and long-term incentive compensation, stock option gains,
the value of all perquisites and other personal benefits,
pay-out obligations under VFs pension plan, pay-out
obligations under VFs Supplemental Executive Retirement
Plan (SERP), and pay-out obligations under VFs
deferred compensation plan. A tally sheet setting forth all the
above components was reviewed by the Committee. Based on this
review, the Committee finds Mr. McDonalds total
compensation to be consistent with the overall compensation
philosophy of VF, appropriate in relationship to his peers, and
reflective of the Committees assessment of his performance
as Chief Executive Officer.
Tax Deductibility Considerations
Section 162(m) of the Internal Revenue Code of 1986, as
amended, limits the deductibility of compensation in excess of
$1 million paid to the executive officers named in this
proxy statement, unless certain requirements are met. Stock
options and certain performance-based awards under the 1996
Stock Compensation Plan are designed to meet these requirements
as are annual bonuses under VFs EIC Plan. It is the
present intention of the Compensation Committee to preserve the
deductibility of compensation under Section 162(m) to the
extent the Committee believes that to do so is consistent with
the best interests of shareholders; however, tax deductibility
is only one consideration in determining the type and amount of
compensation. The Board of Directors maintains discretion to set
salaries and grant awards based on the Boards assessment
of individual performance and other relevant factors. Such
salaries and awards may not meet the requirements for full
15
deductibility of Section 162(m). In making compensation
decisions the Board takes into consideration any potential loss
of deductibility.
Ursula O. Fairbairn, Chairman
Edward E. Crutchfield
Daniel R. Hesse
W. Alan McCollough
M. Rust Sharp
The following table sets forth a summary of the compensation
paid or accrued for the years 2002 through 2004 by VF to or for
the benefit of the named executive officers.
SUMMARY COMPENSATION TABLE
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Long-Term | |
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Compensation | |
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Annual Compensation | |
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Awards1 | |
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Securities | |
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Other | |
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Underlying | |
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Annual | |
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Options/ | |
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LTIP | |
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All Other | |
Name and |
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Compen- | |
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SARs | |
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Pay-outs | |
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Compen- | |
Principal Position |
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Year | |
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Salary($) | |
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Bonus($) | |
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sation($)2 | |
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(#) | |
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($) | |
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sation($)3 | |
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Mackey J. McDonald
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2004 |
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$ |
990,000 |
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$ |
1,985,000 |
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213,400 |
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$ |
198,869 |
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$ |
12,500 |
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Chairman, President and |
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2003 |
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990,000 |
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1,039,500 |
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350,000 |
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169,733 |
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12,500 |
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Chief Executive Officer |
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2002 |
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990,000 |
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1,455,000 |
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350,000 |
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310,800 |
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12,500 |
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Terry L. Lay
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2004 |
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577,700 |
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614,000 |
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54,300 |
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72,994 |
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12,500 |
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Vice President and Chairman |
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2003 |
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525,300 |
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390,000 |
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100,000 |
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62,251 |
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12,500 |
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Jeanswear Coalition |
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2002 |
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510,000 |
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522,700 |
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100,000 |
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114,100 |
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12,500 |
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John P. Schamberger
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2004 |
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541,100 |
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614,000 |
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54,300 |
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72,994 |
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12,500 |
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Vice President and Chairman |
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2003 |
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525,300 |
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355,000 |
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100,000 |
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62,251 |
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12,500 |
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Cross Coalition Management |
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2002 |
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510,000 |
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522,700 |
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100,000 |
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114,100 |
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12,500 |
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Robert K. Shearer
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2004 |
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481,700 |
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579,200 |
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43,600 |
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60,609 |
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12,500 |
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Vice President Finance and |
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2003 |
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440,000 |
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325,000 |
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80,000 |
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51,710 |
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12,500 |
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Global Processes and Chief Financial Officer |
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2002 |
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392,500 |
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433,600 |
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80,000 |
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94,700 |
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12,500 |
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Eric C. Wiseman
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2004 |
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485,600 |
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698,700 |
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54,300 |
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72,994 |
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12,500 |
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Vice President and Chairman |
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2003 |
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423,300 |
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315,000 |
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80,000 |
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62,251 |
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12,500 |
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Outdoor and Sportswear Coalitions |
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2002 |
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370,000 |
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433,400 |
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80,000 |
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94,700 |
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12,500 |
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1 |
The target number and aggregate value of performance-contingent
Common Stock units earnable by the named executive officers at
January 1, 2005 were as follows:
Mr. McDonald 75,146, $4,161,586;
Mr. Lay 19,434, $1,076,255;
Mr. Schamberger 19,434, $1,076,255;
Mr. Shearer 15,669, $867,749; and
Mr. Wiseman 19,434, $1,076,255. If designated
performance levels corresponding to a maximum earning of
performance-contingent Common Stock units are achieved, the
number of units that may be earned and the related dollar values
for each executive officer in the preceding sentence would
double. Also, at fiscal year-end, Mr. McDonald held
48,374 shares of restricted stock, having an aggregate
value of $2,678,952, and Mr. Schamberger held 14,237
restricted shares, having an aggregate value of $788,445, based
on the closing price of VF Common Stock on January 1, 2005.
Holders of shares of restricted stock have the right to receive
dividends on such shares. |
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2 |
The incremental cost to VF of perquisites and other personal
benefits provided to each named executive officer did not exceed
the lesser of $50,000 or 10% of the executives Salary plus
Bonus. |
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3 |
The amount in this column for 2004 represents VFs matching
contribution under the Executive Deferred Savings Plan. |
16
LONG-TERM INCENTIVE AWARDS
Stock Options
This table sets forth for the named executive officers
information regarding the grant of stock options by VF in the
2004 fiscal year and their potential realizable values. No stock
appreciation rights have been granted to employees other than
limited stock appreciation rights, which become exercisable only
upon a Change in Control. All stock options were granted under
VFs 1996 Stock Compensation Plan, as amended, which is a
shareholder-approved plan. This Plan is VFs only plan
under which stock options and other equity awards are granted.
Options Granted in the Last Fiscal Year
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Potential Realizable Value | |
|
|
|
|
|
|
|
|
|
|
|
|
at Assumed Annual Rates | |
|
|
|
|
of Stock Price Appreciation | |
|
|
Individual Grants1 | |
|
for Option Term2 | |
|
|
|
|
|
No. of | |
|
% of Total | |
|
|
|
|
Securities | |
|
Options | |
|
Exercise | |
|
|
|
|
Underlying | |
|
Granted to | |
|
or Base | |
|
|
|
|
Options | |
|
Employees in | |
|
Price | |
|
Expiration | |
|
|
Name |
|
Granted(#) | |
|
Fiscal Year | |
|
($/Sh) | |
|
Date | |
|
5% | |
|
10% | |
|
|
|
M.J. McDonald
|
|
|
213,400 |
|
|
|
12.1% |
|
|
$ |
44.80 |
|
|
|
2/12/2014 |
|
|
|
$6,011,000 |
|
|
|
$15,237,000 |
|
|
|
T.L. Lay
|
|
|
54,300 |
|
|
|
3.1% |
|
|
$ |
44.80 |
|
|
|
2/12/2014 |
|
|
|
1,530,000 |
|
|
|
3,877,000 |
|
|
|
J.P. Schamberger
|
|
|
54,300 |
|
|
|
3.1% |
|
|
$ |
44.80 |
|
|
|
2/12/2014 |
|
|
|
1,530,000 |
|
|
|
3,877,000 |
|
|
|
R.K. Shearer
|
|
|
43,600 |
|
|
|
2.5% |
|
|
$ |
44.80 |
|
|
|
2/12/2014 |
|
|
|
1,228,000 |
|
|
|
3,113,000 |
|
|
|
E.C. Wiseman
|
|
|
54,300 |
|
|
|
3.1% |
|
|
$ |
44.80 |
|
|
|
2/12/2014 |
|
|
|
1,530,000 |
|
|
|
3,877,000 |
|
|
|
|
|
1 |
All of the options were non-qualified stock options granted in
February 2004. Each option becomes exercisable in thirds on the
first, second and third anniversaries of the date of grant,
respectively. Options generally become fully exercisable upon a
Change in Control. All options have a ten-year term but, in the
event of certain terminations of the optionees employment,
the option will expire on an accelerated basis, as follows:
36 months after retirement or death; 12 months after
termination due to disability; at the end of the period
severance payments are made (if any) in the case of involuntary
termination; and at the time of any voluntary termination. |
|
2 |
The dollar gains under these columns result from calculations
assuming 5% and 10% growth rates as set by the Securities and
Exchange Commission and are not intended to forecast future
price appreciation of VF Common Stock. It is important to note
that options will result in receipt of no value to recipients,
including the named executive officers, unless the stock price
appreciates above the exercise price shown in the table during
the period in which the option is exercisable. |
17
The following table sets forth for the named executive officers
information regarding stock options exercised by them during the
2004 fiscal year, together with the number and value of stock
options held at 2004 fiscal year end, each on an aggregate basis.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aggregated Option Exercises in the 2004 Fiscal Year and Fiscal Year-End Option Value |
|
|
|
Value of | |
|
|
|
|
Number of | |
|
Unexercised | |
|
|
|
|
Unexercised | |
|
In-the-Money | |
|
|
|
|
Options at | |
|
Options at | |
|
|
|
|
Fiscal Year-End | |
|
Fiscal Year-End1 | |
|
|
|
|
| |
|
| |
|
|
|
|
Number of | |
|
|
|
(#) | |
|
($) | |
|
|
|
|
Shares Acquired | |
|
Value | |
|
Exercisable/ | |
|
Exercisable/ | |
|
|
Name |
|
on Exercise(#) | |
|
Realized($) | |
|
Unexercisable | |
|
Unexercisable | |
|
|
|
M.J. McDonald
|
|
|
|
|
|
$ |
|
|
|
|
964,063/563,399 |
|
|
|
$17,316,346/ |
$8,795,755 |
|
|
T.L. Lay
|
|
|
700 |
|
|
|
10,745 |
|
|
|
288,801/184,299 |
|
|
|
5,567,763/ |
3,041,875 |
|
|
J.P. Schamberger
|
|
|
162,000 |
|
|
|
2,355,521 |
|
|
|
100,001/184,299 |
|
|
|
1,658,019/ |
3,041,875 |
|
|
R.K. Shearer
|
|
|
13,000 |
|
|
|
257,959 |
|
|
|
245,001/123,599 |
|
|
|
4,568,017/ |
1,955,671 |
|
|
E.C. Wiseman
|
|
|
|
|
|
|
|
|
|
|
202,001/134,299 |
|
|
|
3,687,377/ |
2,068,877 |
|
|
|
|
|
|
|
|
1 |
Market value of underlying shares at fiscal year-end based on
the fiscal year-end market price of $55.38 per share, minus
the exercise price. |
|
Performance-Contingent Common Stock Units
This table gives information concerning the awards to the named
executive officers made in 2004 for the three-year performance
period of 2004 through 2006 under the Mid-Term Incentive Plan, a
subplan under the VF 1996 Stock Compensation Plan. Under this
Plan, the executives were awarded performance-contingent Common
Stock units, which gave them the opportunity to earn shares of
VF Common Stock. Actual pay-out of these shares is determined
based on the level of achievement of the performance goals under
the EIC Plan during the three years of the performance period.
The EIC Plan performance goals for 2004 were, and those set for
2005 are, based on earnings per share (excluding the effects of
extraordinary and non-recurring items) and net sales. The
Compensation Committee will set new EIC Plan performance goals
in 2006, although the Committee retains discretion to set
performance goals under this Plan that differ from those under
the EIC Plan. In order for the CEO and certain other highly
compensated executives to earn Common Stock units under this
Plan, in addition to meeting the other goals under the Plan, the
Company must have positive earnings per share throughout the
performance period. These awards are forfeitable upon an
executives termination of employment, except (i) a
pro rata portion of the award will be deemed earned in the event
of death, disability, or retirement, (ii) a pro rata
portion of the award will be deemed earned in the event of a
termination by the Company without cause prior to a change in
control, with pro ration based on the part of the performance
period in which the executive remained employed plus any period
during which severance payments will be made, and (iii) the
full award at the higher of target performance or actual
performance achieved through the date of termina-
18
tion will be deemed earned in the event of a termination by the
Company without cause or by the executive for good reason after
a change in control.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Long-Term Incentive Plans Awards in Last Fiscal Year | |
| |
|
|
Estimated Future Pay-out Under | |
|
|
Non-Stock Price-Based Plans1 | |
| |
Name |
|
Threshold(#) | |
|
Target(#) | |
|
Maximum(#) | |
| |
M.J. McDonald
|
|
|
0 |
|
|
|
67,800 |
|
|
|
135,600 |
|
T.L. Lay
|
|
|
0 |
|
|
|
16,739 |
|
|
|
33,478 |
|
J.P. Schamberger
|
|
|
0 |
|
|
|
16,739 |
|
|
|
33,478 |
|
R.K. Shearer
|
|
|
0 |
|
|
|
13,431 |
|
|
|
26,862 |
|
E.C. Wiseman
|
|
|
0 |
|
|
|
16,739 |
|
|
|
33,478 |
|
|
|
|
|
|
|
1 |
The actual number of shares, if any, that will be paid out at
the end of the applicable period cannot be determined because
the shares earned by the named executive officers will be based
on VFs performance over the 2004-2006 performance period. |
|
EQUITY COMPENSATION PLAN INFORMATION TABLE
The following table provides information as of January 1,
2005 regarding the number of shares of VF Common Stock that
may be issued under VFs equity compensation plans.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) | |
|
(b) | |
|
(c) | |
|
|
| |
|
| |
|
| |
|
|
|
|
|
|
Number of securities | |
|
|
Number of | |
|
|
|
remaining available | |
|
|
securities to be | |
|
|
|
for future issuance | |
|
|
issued upon | |
|
Weighted-average | |
|
under equity | |
|
|
exercise of | |
|
exercise price of | |
|
compensation plans | |
|
|
outstanding | |
|
outstanding | |
|
(excluding securities | |
|
|
options, warrants | |
|
options, warrants | |
|
reflected in | |
Plan Category1 |
|
and rights2 | |
|
and rights2 | |
|
column (a))3 | |
| |
Equity compensation plans approved by shareholders
|
|
|
10,269,417 |
|
|
$ |
37.98 |
|
|
|
9,186,248 |
|
Equity compensation plans not approved by shareholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
10,269,417 |
|
|
$ |
37.98 |
|
|
|
9,186,248 |
|
|
|
|
1 |
The table does not include information regarding the following
VF plans: |
|
|
|
|
|
Employee Stock Ownership Plan. As of January 1, 2005, there
were 843,814 shares of Series B ESOP Stock
outstanding, all of which were allocated to the accounts of
participants in this Plan. Each share of Series B ESOP
Stock is convertible into 1.6 shares of VF Common Stock. |
|
|
|
Executive Deferred Savings Plan and Deferred Savings Plan for
Non-Employee Directors. These plans permit the deferral of
salary, bonus and director compensation into, among other
things, stock equivalent accounts. Deferrals in a stock
equivalent account are valued as if deferrals were invested in
VF Common Stock as of the deferral date, and are paid out only
in cash. VF maintains a rabbi trust that holds shares that
approximately correspond in number to the stock equivalents, and
provides pass-through voting rights with respect to those stock
equivalents. Stock equivalents are credited with dividend
equivalents. As of January 1, 2005, there were 256,088
stock equivalents outstanding in the stock equivalent accounts
under these plans. |
|
|
2 |
Includes 524,548 restricted stock units that were outstanding on
January 1, 2005 under VFs Mid-term Incentive Plan, a
subplan under the 1996 Stock Compensation Plan. Under this Plan,
participants are awarded performance-contingent Common Stock
units, which gives them the opportunity to earn shares of VF
Common Stock. The number of restricted stock units included in
the table assumes a maximum pay-out of shares. Actual pay-out of
these shares is determined based on the level of achievement of
the performance goals under the Executive Incentive Compensation
Plan. The Executive Incentive Compensation Plan performance
goals for 2004 were, and those set for 2005 are, based on
earnings per share (excluding the effects of extraordinary and
non-recurring |
19
|
|
|
items) and net sales. Also includes
102,113 restricted stock units that have been awarded to
participants but that participants have elected to defer.
Restricted stock unit awards do not have an exercise price
because their value is dependent upon the achievement of the
specified performance criteria and may be settled only for
shares of Common Stock on a one-for-one basis. Accordingly, the
restricted stock units have been disregarded for purposes of
computing the weighted-average exercise price. Had these
restricted stock units been included in the calculation, the
weighted-average exercise price reflected in column
(b) would have been $35.66.
|
|
3 |
Of the shares remaining available
for future issuance, a total of 2,450,950 shares (assuming
a maximum pay-out of shares) may be issued as restricted stock
and restricted stock units under VFs 1996 Stock
Compensation Plan, VFs only plan under which restricted
stock/unit awards may be granted. This Plan also authorizes the
grant of options and other types of equity awards, so that
shares will not necessarily be issued as restricted stock/unit
awards.
|
FUTURE REMUNERATION
Pension Plan and Supplemental Executive Retirement Plan
VF maintains and contributes to the VF Corporation Pension Plan
(the Pension Plan), a defined benefit plan that
covers all of VFs domestic employees who where employed by
VF on December 31, 2004, including the named executive
officers. Benefits under the Pension Plan are determined based
on average annual salary and bonus compensation from
January 1, 2004, with no less than five years immediately
preceding retirement included in the average. If an employee
does not have five years of compensation commencing immediately
prior to January 1, 2004, such employees compensation
for a sufficient number of years immediately prior to 2004 shall
be included to produce a minimum five compensation years.
The Supplemental Executive Retirement Plan (SERP) is
an unfunded, non-qualified plan for eligible participants
primarily designed (i) to restore benefits lost under the
Pension Plan due to (a) the maximum legal limit of pension
benefits imposed under the Employee Retirement Income Security
Act of 1974 (ERISA) and the Internal Revenue Code
(the Code) and (b) an election to defer
compensation under VFs Deferred Compensation Plan and/or
Executive Deferred Savings Plan and (ii) to supplement the
Pension Plan benefits of those senior executives whose tenure
may be relatively short by virtue of having joined VF in
mid-career or who lost pension benefits with former employers as
a result of an early separation from service. The combined
retirement income from the Pension Plan and the SERP for each of
the named executive officers, upon retirement at age 65,
would be an amount equal to his Pension Plan benefit calculated
(i) without regard to any limitation imposed by the Code or
ERISA, (ii) without regard to his participation in the
Deferred Compensation Plan or the Executive Deferred Savings
Plan, (iii) on the basis of the average of the highest
three years of his salary and bonus compensation during the
ten-year period immediately preceding retirement, and
(iv) without deduction or offset of amounts of Social
Security benefits.
20
The following table reflects estimated annual benefits that
would be payable under the Pension Plan and the SERP upon
retirement at age 65 of individuals in the specified
remuneration and years of service classifications.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Assumed Average | |
|
|
Remuneration | |
|
Years of Service: | |
| |
|
|
10 years | |
|
15 years | |
|
20 years | |
|
25 years or more | |
| |
$ |
600,000 |
|
|
$ |
105,000 |
|
|
$ |
157,000 |
|
|
$ |
210,000 |
|
|
$ |
262,000 |
|
|
800,000 |
|
|
|
141,000 |
|
|
|
211,000 |
|
|
|
282,000 |
|
|
|
352,000 |
|
|
1,100,000 |
|
|
|
195,000 |
|
|
|
292,000 |
|
|
|
390,000 |
|
|
|
487,000 |
|
|
1,250,000 |
|
|
|
222,000 |
|
|
|
333,000 |
|
|
|
444,000 |
|
|
|
555,000 |
|
|
1,500,000 |
|
|
|
267,000 |
|
|
|
400,000 |
|
|
|
534,000 |
|
|
|
667,000 |
|
|
2,000,000 |
|
|
|
357,000 |
|
|
|
535,000 |
|
|
|
714,000 |
|
|
|
892,000 |
|
|
2,250,000 |
|
|
|
402,000 |
|
|
|
603,000 |
|
|
|
804,000 |
|
|
|
1,005,000 |
|
|
2,500,000 |
|
|
|
447,000 |
|
|
|
670,000 |
|
|
|
894,000 |
|
|
|
1,117,000 |
|
|
2,750,000 |
|
|
|
492,000 |
|
|
|
738,000 |
|
|
|
984,000 |
|
|
|
1,230,000 |
|
|
3,000,000 |
|
|
|
537,000 |
|
|
|
805,000 |
|
|
|
1,074,000 |
|
|
|
1,342,000 |
|
|
The amounts in the table have been computed on a straight-life
annuity basis. Final Average Compensation is based on salary and
bonus as such amounts are computed and reflected in the Summary
Compensation Table. Each of the named executive officers has
credited years of service under the Pension Plan as follows:
Mr. McDonald 22 years;
Mr. Lay 31 years;
Mr. Schamberger 33 years;
Mr. Shearer 18 years; and
Mr. Wiseman 9 years.
The Pension Plan provides that if it is Overfunded
upon the occurrence of a Change in Control of VF (as
those terms are defined in the Pension Plan), certain Pension
Plan assets in excess of those needed to meet expected benefit
entitlements are to be used fully and irrevocably to vest each
participants accrued benefit and provide increases in
accrued benefits for active participants, retired participants,
surviving spouses and beneficiaries and terminated vested
participants. The Pension Plan is considered
Overfunded to the extent that the fair market value
of Pension Plan assets exceeds Pension Plan liabilities
(primarily the actuarial present value of Pension Plan benefit
entitlements). As of the end of VFs most recent fiscal
year, the Pension Plan was not Overfunded. SERP benefits will
become funded upon a Change in Control of VF, as
defined in the Change in Control Agreements described below. In
this regard, VF has established a trust with Wachovia
Corporation, as Trustee (the SERP Trust). VF may
fund the SERP Trust at any time to secure payment of certain
SERP benefits not otherwise paid by VF. Upon a Change in
Control, VF is required to fund the SERP Trust, which becomes
irrevocable.
Had there been a Change in Control as of March 8, 2005, the
combined estimated annual benefits vested under the Pension Plan
and the SERP and payable beginning at age 65 for each of
the named executive officers would have been as follows:
Mr. McDonald $1,308,528;
Mr. Lay $528,132;
Mr. Schamberger $505,836;
Mr. Shearer $265,764; and
Mr. Wiseman $169,980.
21
Change in Control and Other Arrangements
VF has entered into Change in Control Agreements with certain of
its executives. These Agreements provide severance benefits to
the designated executives in the event their employment is
terminated within a specified period after a Change in
Control of VF, as such term is defined in the Agreements.
The Agreements generally have a term of three years with
automatic annual extensions. The Agreements may be terminated,
subject to the limitations outlined below, by VF upon notice to
the executive and are automatically terminated if the
executives employment with VF ceases. VF may not terminate
the Agreements (i) if it has knowledge that any third
person has taken steps or has announced an intention to take
steps reasonably calculated to effect a Change in Control or
(ii) within a specified period of time after a Change in
Control occurs. Severance benefits payable to the named
executive officers include the lump sum payment of an amount
equal to 2.99 times the sum of the executives current
annual salary plus the highest amount of bonus awarded to the
executive during the five fiscal years ending prior to the date
on which the executives employment is terminated following
a Change in Control of VF.
There are no limitations on the total payments to be made to an
executive in the event of termination of employment upon a
Change in Control to prevent such payments from constituting
excess parachute payments (as that term is defined
in the Code). Executives also receive additional payments under
the Agreements to reimburse them for any increased golden
parachute excise taxes, other increased taxes, penalties and
interest resulting from severance payments under the Agreements
by reason of such payments being treated as excess parachute
payments.
Had there been a Change in Control as of March 8, 2005
approximate payments under the Agreements upon severance of the
named executive officers would have been as follows (excluding
applicable reimbursements for increased taxes, penalties and
interest, if any): Mr. McDonald $9,224,150;
Mr. Lay $3,635,840;
Mr. Schamberger $3,502,187;
Mr. Shearer $3,225,612; and
Mr. Wiseman $3,605,641.
Under the terms of the Agreements, the executives also would be
entitled to supplemental benefits, such as accelerated rights to
exercise stock options, accelerated lapse of restrictions on
restricted stock and restricted stock units, lump sum payments
under the VF SERP, continued life and medical insurance for
specified periods after termination, entitlements under
retirement plans and a lump sum payment upon attaining
retirement age. Upon a Change in Control, VF also will pay all
reasonable legal fees and related expenses incurred by the
executives as a result of the termination of their employment or
in obtaining or enforcing any right or benefit provided by the
Agreements.
VF maintains an Executive Deferred Savings Plan (the EDS
Plan), which is an unfunded, non-qualified deferred
compensation arrangement for a select group of management and
highly compensated employees of VF and certain of its
subsidiaries. The EDS Plan permits an eligible employee to defer
the receipt of a specified portion of his or her compensation
until the date of retirement, disability, death or termination
of employment. In 2004, VF matched 50% of the first $25,000
deferred by each participant. Upon a Change in
22
Control of VF, matching contributions become fully vested and VF
is required to fully fund the amount accrued for each employee.
As of March 8, 2005, all matching contributions made for
the benefit of the named executive officers were fully vested
based on their years of service with VF.
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder
return on VF Common Stock with that of the
Standard & Poors (S&P)
500 Stock Index and the S&P 1500 Apparel,
Accessories & Luxury Goods Index (S&P Apparel
Index) for the five years ended December 31, 2004.
The graph assumes that $100 was invested on January 1,
2000, in each of VF Common Stock, the S&P 500
Stock Index and the S&P Apparel Index, and that all
dividends were reinvested. The graph plots the respective values
on the five single days that are the last trading days of
calendar years 1999 through 2004. Past performance is not
necessarily indicative of future performance.
Comparison of Five-Year Total Return of
VF Common Stock, S&P 500 Index, and S&P
Apparel Index
VF Common Stock closing price on December 31, 2004
was $55.38
TOTAL SHAREHOLDER RETURNS
23
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Certain Beneficial Owners
Shown below are persons known by VF to have voting power and/or
dispositive power over more than 5% of its Common Stock or
Series B ESOP Stock, as well as certain other information,
all as of March 8, 2005, except that information regarding
the number of shares beneficially owned by certain of the
shareholders (but not the calculation of the percentage of the
outstanding class) is as of December 31, 2004, as indicated
in the footnotes below.
|
|
|
|
|
|
|
|
|
|
| |
Beneficial Owner |
|
Amount of | |
|
Percent | |
and Nature of Ownership |
|
Beneficial Ownership1 | |
|
of Class | |
| |
Common Stock |
Ursula O. Fairbairn, M. Rust Sharp and PNC Bank, N.A.,
P.O. Box 7648,
Philadelphia, PA 19101,
as Trustees under Deeds of Trust dated August 21, 1951
2,3,4 |
|
|
8,977,952 shares |
|
|
|
8.0 |
% |
Ursula O. Fairbairn, M. Rust Sharp and PNC Bank, N.A.,
P.O. Box 7648,
Philadelphia, PA 19101,
as Trustees under the Will of John E. Barbey, deceased
2,3,4 |
|
|
12,933,926 shares |
|
|
|
11.5 |
% |
|
|
|
|
|
|
|
|
Total
|
|
|
21,911,878 shares |
|
|
|
19.5 |
% |
AXA Financial, Inc.
1290 Avenue of the Americas
New York, New York
101045 |
|
|
10,141,595 shares |
|
|
|
9.0 |
% |
Capital Research Management Company
333 South Hope Street
Los Angeles, CA
900716 |
|
|
5,750,000 shares |
|
|
|
5.1 |
% |
Dodge & Cox
One Sansome St., 35th Floor
San Francisco, CA
941047 |
|
|
6,970,032 shares |
|
|
|
6.2 |
% |
Series B ESOP Convertible Preferred Stock |
Fidelity Management Trust Company,
82 Devonshire Street, H11D,
Boston, MA 02109-3614,
as Trustee of VFs Tax-Advantaged Savings Plan for
Salaried Employees |
|
|
812,726 shares |
|
|
|
100 |
% |
|
|
|
1 |
None of the shares in this column is known to be a share with
respect to which any of the listed owners has the right to
acquire beneficial ownership, as specified in
Rule 13d-3(d)(1) under the 1934 Act. |
|
2 |
Mrs. Fairbairn and Mr. Sharp are directors of VF. |
|
3 |
Present life tenants and remaindermen under the Will are
various. All present life tenants and all or most future life
tenants and/or remaindermen under the Deeds of Trust are, or
will be, descendants of John E. Barbey. No individual life
tenant or remainderman may, within 60 days, attain
beneficial ownership, as specified in Rule 13d-3(d)(1)
under the 1934 Act, which exceeds 5% of the outstanding
shares. |
|
4 |
Including shares in the above table, PNC Bank, N.A. and its
affiliates held a total of 22,161,642 shares (19.7% of the
class outstanding) of the VF Common Stock in various trust
and agency accounts on December 31, 2004, according to a
Schedule 13 G/ A filed by the Bank with the Securities
and Exchange Commission on February 10, 2005. As to all
such shares, the Bank and its affiliates had sole voting power
over 242,014 shares, shared voting power over
21,919,628 shares, sole dispositive power over
178,903 shares and shared dispositive power over
21,958,228 shares. |
|
5 |
AXA Assurances I.A.R.D. Mutuelle (IARD),
AXA Assurances Vie Mutuelle (Vie) and
AXA Courtage Assurance Mutuelle (Courtage), as
a group (collectively, the Mutuelles AXA),
together with AXA and with AXA Financial, Inc.
(AXA Financial), filed a joint Amendment
No. 5 to Schedule 13G with the SEC on
February 14, 2005. That Schedule 13G/ A shows that, at
December 31, 2004, Mutuelles AXA, AXA, and |
24
|
|
|
AXA Financial as a group may
be deemed to beneficially own the number of shares reported in
the table above, including sole power to
vote 5,288,340 shares, shared power to
vote 1,378,331 shares, sole power to dispose of
10,141,595 shares, and shared power to dispose of
-0- shares. Of these shares, 10,031,487 are beneficially
owned through Alliance Capital Management, L.P., a subsidiary of
AXA Financial that operates independently from AXA
Financial. AXA owns AXA Financial, and Mutuelles AXA
as a group controls AXA. Addresses of these entities are as
follows: IARD, Vie, and Courtage, 26, rue Louis
le Grand, 75009 Paris, France; and AXA, 25 avenue
Matignon, 75008 Paris, France.
|
|
6 |
The information in the above table
concerning Capital Research Management Company
(Capital) was obtained from a
Schedule 13 G/ A filed with the Securities and
Exchange Commission on February 14, 2005, reporting
beneficial ownership at December 31, 2004. Capital reported
that it had sole dispositive power over all of such shares and
sole voting power and shared voting power over none of such
shares.
|
|
7 |
The information in the above table
concerning Dodge & Cox was obtained from a
Schedule 13 G/ A filed with the Securities and
Exchange Commission on February 10, 2005, reporting
beneficial ownership at December 31, 2004. Dodge &
Cox reported that it had sole voting power over
6,539,432 shares, shared voting power over
106,400 shares and sole dispositive power over all of such
shares.
|
25
Common Stock Ownership of Management
The following table reflects, as of March 8, 2005, the
total beneficial ownership of VF Common Stock by each
director and nominee for director, and each named executive
officer, and by all directors and executive officers as a group.
Each named individual and all members of the group exercise sole
voting and dispositive power, except as indicated in the
footnotes. Share ownership of Mrs. Fairbairn and
Mr. Sharp includes 21,911,878 shares reported above
under Certain Beneficial Owners, as to which they share voting
and dispositive power with PNC Bank, N.A., as Trustees as
of December 31, 2004.
|
|
|
|
|
|
| |
|
|
Total Shares | |
Name of Beneficial Owner |
|
Beneficially Owned1,2,3,4 | |
| |
Directors:
|
|
|
|
|
|
Edward E. Crutchfield
|
|
|
24,595 |
|
|
Juan Ernesto de Bedout
|
|
|
26,023 |
|
|
Ursula O. Fairbairn
|
|
|
21,966,524 |
|
|
Barbara S. Feigin
|
|
|
52,278 |
|
|
George Fellows
|
|
|
34,600 |
|
|
Daniel R. Hesse
|
|
|
30,523 |
|
|
Robert J. Hurst
|
|
|
62,551 |
|
|
W. Alan McCollough
|
|
|
24,346 |
|
|
Clarence Otis, Jr.
|
|
|
5,761 |
|
|
M. Rust Sharp
|
|
|
21,961,144 |
|
|
Raymond G. Viault
|
|
|
15,476 |
|
Named Executive Officers:
|
|
|
|
|
|
Mackey J. McDonald
|
|
|
1,392,134 |
5 |
|
Terry L. Lay
|
|
|
203,262 |
|
|
John P. Schamberger
|
|
|
159,363 |
6 |
|
Robert K. Shearer
|
|
|
337,731 |
|
|
Eric C. Wiseman
|
|
|
284,456 |
|
All Directors and Executive Officers as a Group (20 persons)
|
|
|
25,232,997 |
|
|
|
|
1 |
Shares owned include shares held in trusts as of
December 31, 2004 in connection with employee benefit
plans, as to which the following participants share voting power
but have no present dispositive power:
Mr. McDonald 21,382 shares;
Mr. Lay 1,406 shares;
Mr. Wiseman 3,630 shares; and all
directors and executive officers as a group
53,202 shares. Does not include shares of Series B
ESOP Stock held in trust in connection with an employee benefit
plan, as to which participants also share voting power but have
no present dispositive power and no power to direct conversion
into Common Stock, as follows: Mr. McDonald
119 shares; Mr. Lay 346 shares;
Mr. Schamberger 372 shares;
Mr. Shearer 413 shares; and all directors
and executive officers as a group 1,784 shares.
Shares owned also include shares held as of December 31,
2004 in trust in connection with employee benefit plans, as to
which the following participants have no dispositive power and
shared voting power: Mr. McDonald
690 shares; Mr. Lay 1,224 shares;
Mr. Shearer 440 shares;
Mr. Schamberger 48 shares; and all
directors and executive officers as a group
4,641 shares. Shares owned also include shares held in a
trust in connection with the VF Deferred Savings Plan for
Non-Employee Directors as to which the following directors have
shared voting power but do not have dispositive power:
Mr. de Bedout 4,822 shares;
Mrs. Fairbairn 10,068 shares;
Mrs. Feigin 5,878 shares;
Mr. Hesse 6,522 shares;
Mr. Hurst 13,150 shares;
Mr. McCollough 5,145 shares;
Mr. Otis 960 shares; |
26
|
|
|
Mr. Sharp
4,665 shares; Mr. Viault
3,076 shares; and all directors and executive officers as a
group 54,286.
|
|
2 |
Shares owned also include the
following number of stock options that are exercisable as of
March 8, 2005, or within 60 days thereafter:
Mr. McDonald 1,268,530;
Mr. Lay 184,767;
Mr. Schamberger 118,100;
Mr. Shearer 312,868;
Mr. Wiseman 273,434;
Mr. Crutchfield 4,800; Mr. de
Bedout 19,200; Mrs. Fairbairn
42,600; Mrs. Feigin 42,600;
Mr. Fellows 33,600; Mr. Hesse
24,000; Mr. Hurst 42,600;
Mr. McCollough 19,200;
Mr. Otis 4,800; Mr. Sharp
42,600; Mr. Viault 9,600; and all directors and
executive officers as a group 2,954,634.
|
|
3 |
Other than Mrs. Fairbairn and
Mr. Sharp, who are deemed to beneficially own 19.5% of the
Common Stock outstanding, and Mr. McDonald, who
beneficially owns 1.24% of the Common Stock outstanding, the
percentage of shares owned beneficially by each named person
does not exceed 1% of the Common Stock outstanding. The
percentage of shares owned beneficially by all directors and
executive officers as a group was 22.4% of the Common Stock
outstanding.
|
|
4 |
Shares owned include units of
VF Common Stock equivalents that are deferred under the
VF Stock Compensation Plan, as follows:
Mr. McDonald 31,254; Mr. Lay
10,447; Mr. Schamberger 11,892;
Mr. Shearer 9,861; Mr. Wiseman
2,773; and all directors and executive officers as a
group 82,831 shares. These units are fully
vested and will be paid out in shares of Common Stock upon
expiration of the deferral period, including upon certain types
of termination of service. Holders of these units do not have
current voting or dispositive power with respect to the shares
deliverable in settlement of these units.
|
|
5 |
Mr. McDonald is also a
director. Shares owned include 48,374 shares of restricted
stock over which Mr. McDonald holds voting power but not
dispositive power.
|
|
6 |
Includes 14,237 shares of
restricted stock over which Mr. Schamberger holds voting
power but not dispositive power.
|
ITEM NO. 2
RATIFICATION OF THE SELECTION
OF INDEPENDENT AUDITORS
Selection of Independent Auditors. The Audit Committee
has retained PricewaterhouseCoopers LLP as VFs
independent auditors for the fiscal year ending
December 31, 2005. PricewaterhouseCoopers LLP served
as VFs independent auditors for the fiscal year ended
January 1, 2005. In connection with its decision to retain
PricewaterhouseCoopers LLP as VFs independent
auditors, the Audit Committee considered whether the provision
of non-audit services by PricewaterhouseCoopers LLP was
compatible with maintaining
PricewaterhouseCoopers LLPs independence and
concluded that it was. A representative of
PricewaterhouseCoopers LLP will be present at the Meeting.
The representative will be given an opportunity to make a
statement if he or she desires to do so and to respond to
appropriate questions. Although we are not required to do so, we
believe it is appropriate to ask shareholders to ratify the
appointment of PricewaterhouseCoopers LLP as VFs
independent auditors. If shareholders do not ratify the
selection of PricewaterhouseCoopers LLP, the Audit
Committee will reconsider the selection of independent auditors.
The VF Board of Directors recommends a
vote FOR ratification of the
selection of PricewaterhouseCoopers LLP.
Professional Fees of PricewaterhouseCoopers LLP. The
following summarizes the estimated fees of
PricewaterhouseCoopers LLP for services rendered to VF
during the fiscal year ended January 3, 2004 and the fiscal
year ended January 1, 2005.
Audit Fees: The aggregate audit fees billed or to be
billed for professional services rendered were $1,582,000 for
the fiscal year ended January 3, 2004 and $3,500,000 for
the fiscal year ended January 1, 2005. In accordance with
the SECs definitions and rules, audit fees are
fees that VF paid to PricewaterhouseCoopers LLP for the
audit of VFs consoli-
27
dated financial statements included in VFs annual report
on Form 10-K and review of financial statements included in
the quarterly reports on Form 10-Q, and for services that
are normally provided by the auditor in connection with
statutory and regulatory filings or engagements; and in
addition, beginning in 2004, for the audit of VFs internal
control over financial reporting with the objective of obtaining
reasonable assurance about whether effective internal control
over financial reporting was maintained in all material
respects; and for the attestation of managements report on
the effectiveness of internal control over financial reporting.
Audit-Related Fees: The aggregate fees billed for
assurance and related services that are reasonably related to
the performance of the audit or review of VFs financial
statements and are not reported above under the caption
Audit Fees were $265,000 for 2003 and $954,000 for
2004. The foregoing services in 2004 consisted primarily of due
diligence on certain acquisition efforts and employee benefit
plan audits. The foregoing services in 2003 consisted primarily
of services related to Sarbanes-Oxley compliance matters,
employee benefit plan audits and employee benefit audits in
Mexico.
Tax Fees: The aggregate fees billed for professional
services for tax compliance, tax advice, and tax planning were
$1,171,000 for 2003 and $1,360,000 for 2004. The foregoing
services in 2004 consisted primarily of expatriate tax support,
tax compliance, tax audit assistance, VAT services,
transfer pricing and customs and duties matters. The foregoing
services in 2003 consisted primarily of services related to
expatriate tax support, tax compliance, VAT services,
Caribbean tax matters, tax audit assistance and customs and
duties matters.
All Other Fees: All other fees paid or payable by VF for
services other than the services reported under Audit
Fees, Audit-Related Fees and Tax
Fees rendered by PricewaterhouseCoopers LLP were
$6,000 in 2003 and $-0- in 2004. The foregoing services in 2003
consisted primarily of services related to setting up a sourcing
office in India.
All audit related services and all other permissible non-audit
services provided by PricewaterhouseCoopers LLP were
pre-approved by the Audit Committee. The pre-approval policies
adopted by the Audit Committee provide that annual, recurring
services that will be provided by VFs independent auditors
and related fees are presented to the Audit Committee for its
consideration and advance approval at each February Audit
Committee meeting. At each February Audit Committee meeting,
criteria are established by the Audit Committee for its advance
approval of specified categories of services and payment of fees
to VFs independent auditors for changes in scope of
recurring services or additional non-recurring services during
the current year. On a quarterly basis, the Audit Committee is
informed of each previously approved service performed by
VFs independent auditors and the related fees.
Report of the Audit Committee. The Audit Committee
reports as follows with respect to the audit of VFs
consolidated financial statements for the fiscal year ended
January 1, 2005 (the 2004 Financial
Statements). At the meeting of the Audit Committee held in
February 2005, the Audit Committee (i) reviewed and
discussed with management the 2004 Financial Statements;
(ii) discussed with PricewaterhouseCoopers LLP the matters
required to be discussed by the Statement of Auditing Standards
No. 61 (Communication with Audit Committees) which include,
among other items, matters related to the conduct of the
28
audit of the 2004 Financial Statements; and (iii) received
from PricewaterhouseCoopers LLP written disclosures
regarding their independence required by Independence Standards
Board Standard No. 1 (Independence Discussions with Audit
Committees) and discussed with PricewaterhouseCoopers LLP
their independence from VF. Based on the foregoing review and
discussions, the Audit Committee recommended to the Board of
Directors that the 2004 Financial Statements as audited by
PricewaterhouseCoopers LLP be included in
VFs Annual Report on Form 10-K for the fiscal
year ended January 1, 2005 to be filed with the Securities
and Exchange Commission.
George Fellows, Chairman
Juan Ernesto de Bedout
Barbara S. Feigin
Clarence Otis, Jr.
Raymond G. Viault
OTHER INFORMATION
Other Matters
The Board of Directors does not know of any other matter that is
intended to be brought before the Meeting, but if any other
matter is presented, the persons named in the enclosed proxy
will be authorized to vote on behalf of the shareholders in
their discretion and intend to vote the same according to their
best judgment. At February 8, 2005, VF had not received
notice of any matter to be presented at the Meeting other than
as described in this proxy statement.
Section 16(a) Beneficial Ownership Reporting
Compliance
Section 16(a) of the Securities Exchange Act of 1934
requires directors and certain officers of VF, as well as
persons who own more than 10% of a registered class of VFs
equity securities (Reporting Persons), to file
reports of ownership and changes in ownership on Forms 3, 4
and 5 with the Securities and Exchange Commission and the New
York Stock Exchange. VF believes that during the preceding year
all Reporting Persons timely complied with all filing
requirements applicable to them, except that Mr. Bradley
Batten, Vice President-Controller, filed a late Form 4
reporting the acquisition of 290 shares of VF Common Stock
through the VF Executive Deferred Savings Plan.
Expenses of Solicitation
VF will bear the cost of this proxy solicitation. In addition to
the use of mail, proxies may be solicited in person or by
telephone by VF employees without additional compensation. VF
has engaged D.F. King & Co., Inc. to solicit proxies in
connection with the proxy statement, and employees of that
company are expected to solicit proxies in person, by telephone
and by mail. The anticipated cost to VF of such solicitation is
approximately $10,000, plus expenses. VF will reimburse brokers
and other persons holding stock in their names or in
29
the names of nominees for their expenses incurred in sending
proxy material to principals and obtaining their proxies.
2005 Shareholder Proposals
In order for shareholder proposals for the 2006 Annual Meeting
of Shareholders to be eligible for inclusion in VFs proxy
statement, VF must receive them at its principal office in
Greensboro, North Carolina on or before November 24, 2005.
In order for shareholder proposals that are not intended to be
included in VFs proxy statement but which are to be
presented at the 2006 Annual Meeting of Shareholders to be
timely, VF must receive notice of such at its principal office
in Greensboro, North Carolina on or before February 7, 2006.
|
|
|
By Order of the Board of Directors |
|
|
Candace S. Cummings |
|
Vice President Administration, |
|
General Counsel and Secretary |
Dated: March 24, 2005
30
APPENDIX A
V.F. CORPORATION
AUDIT COMMITTEE CHARTER
(As Amended April 27, 2004)
The purpose of the Audit Committee (the Committee)
of the Board of Directors (the Board) of V.F.
Corporation (VF) is to assist the Board in its
responsibility to oversee managements conduct of VFs
financial reporting process including (A) overseeing
(1) the integrity of VFs financial statements,
(2) VFs compliance with legal and regulatory
requirements, (3) VFs independent auditors
qualifications and independence, (4) the performance of
VFs internal audit function and independent auditors, and
(5) the effectiveness of VFs internal control process
and (B) preparing the report that is required by the rules
of the Securities and Exchange Commission (SEC) to
be prepared by the audit committee and included in VFs
annual proxy statement. The Audit Committee also functions as
the Qualified Legal Compliance Committee (QLCC) to
review any reports by attorneys employed or retained by VF of a
material violation of U.S. federal or state securities law,
a material breach of fiduciary duty or material violation of any
other U.S. federal or state law.
The Board shall annually designate the members of the Committee
and its Chairman. The Committee shall be composed of not less
than three nor more than six members of the Board. The Board may
fill any vacancies on the Committee. All members of the
Committee shall, in the judgment of the Board, be independent in
accordance with the rules and regulations of the SEC and the New
York Stock Exchange Listing Standards. Each member shall in the
judgment of the Board be financially literate or shall at the
time of appointment undertake training for that purpose. At
least one member of the Audit Committee shall in the judgment of
the Board meet the requirements of audit committee
financial expert in accordance with the rules and
regulations of the SEC and at least one member (who may also
serve as the audit committee financial expert) shall in the
judgment of the Board have accounting or related financial
management expertise in accordance with the New York Stock
Exchange Listing Standards. No action of the Committee shall be
invalid or deemed beyond the authority of the Committee because
of a failure of any member to meet the requirements of this
paragraph. The Secretary of VF or the Secretarys designee
will serve as the Secretary of the Committee.
The Committee shall meet at least four times a year, or more
frequently as circumstances dictate, and at such times and
places as determined by the Committee. The Committee shall meet
regularly in executive session without management present. The
Committee shall meet at least quarterly in separate executive
sessions with management and the General Auditor and at least
annually in a separate executive session with the independent
auditor to discuss any matters that any of them believe should
be discussed
A-1
privately. The Committee shall review with the independent
auditor any problems or difficulties and managements
response.
A meeting of the Committee may be called by any member of the
Committee. A majority of the members of the Committee shall
constitute a quorum at any meeting. In the absence of its
Chairman, the Committee may appoint any other member of the
Committee to preside at its meetings. The members of the
Committee shall not have the authority to appoint another
director to act in the place of an absent or disqualified member
of the Committee.
A written agenda shall be prepared, when possible, for each
meeting and distributed to Committee members before the meeting,
together with any relevant background materials. Minutes of each
meeting shall be prepared and distributed to the Committee. The
Committee shall report on each of its proceedings to the Board
at the next regular meeting of the Board.
|
|
IV. |
Responsibilities and Duties |
The Committee shall have the following basic duties and such
other duties as shall be specifically assigned to the Committee
by the Board and assumed by the Committee:
|
|
A. |
Review of Financial Reports and Press Releases |
1. The Committee shall discuss with management and the
independent auditor the audited financial statements to be
included in VFs Annual Report on Form 10-K (or the
Annual Report to Shareholders if distributed prior to the filing
of Form 10-K), including VFs disclosures under
Managements Discussion and Analysis of Financial
Condition and Results of Operations (MD&A)
and review and consider with the independent auditor the matters
required to be discussed by Statement of Auditing Standards
(SAS) No. 61 (as it may be modified or
supplemented).
2. The Committee, or at least its chairman, shall review
with management and the independent auditor interim financial
results to be included in VFs quarterly reports to be
filed with the Securities and Exchange Commission, MD&A and
the matters required to be discussed by SAS No. 71 (as it
may be modified or supplemented); this review will occur prior
to VFs filing of any Form 10-Q.
3. The Committee shall discuss earnings press releases, as
well as financial information and earnings guidance provided to
analysts and rating agencies. The Committee need not discuss
these items in advance of each earnings release or in each
instance in which VF may provide earnings guidance.
4. The Committee shall discuss policies with respect to
risk assessment and risk management.
1. The Committee shall have the sole authority to retain
(subject, if applicable, to shareholder ratification) and
terminate VFs independent auditor and set its fees.
A-2
2. The Committee shall review with the independent auditor
the scope of the prospective audit, the estimated fees therefor
and such other matters pertaining to such audit as the Audit
Committee may deem appropriate.
3. The Committee shall pre-approve all audit and permitted
non-audit services to be performed by the independent auditor;
or delegate the authority to pre-approve such services to one or
more members of the Audit Committee, who shall report any
decision to pre-approve any services to the full Audit Committee
at its regularly scheduled meetings.
4. The Committee shall, at least annually, receive and
review a report by VFs independent auditor describing:
(a) the firms internal quality-control procedures;
(b) any material issues raised by the most recent internal
quality-control review, or peer review, of the firm, or by any
inquiry or investigation by governmental or professional
authorities, within the preceding five years, respecting one or
more independent audits carried out by the firm, and any steps
taken to deal with any such issues; and (c) (to assess the
auditors independence) all relationships between the
independent auditor and VF.
5. The Committee shall obtain the independent
auditors assurance that the audit was conducted in a
manner consistent with the Securities Exchange Act of 1934, as
amended, and other provisions of applicable law.
6. The Committee shall set clear hiring policies for
employees or former employees of the independent auditor.
C. Internal Audit
1. The Committee shall review the appointment and
replacement of VFs General Auditor; and review any issues
that arise regarding the performance of VFs internal audit
function.
2. The Committee shall receive and review a report, at
least annually, from the General Auditor on VFs internal
controls based on the internal auditing performed and any
matters significant to VF contained in these reports.
3. The Committee shall review the Internal Audit
Departments annual plan, interim activities, and
organizational structure, as needed.
|
|
D. |
Financial Reporting, Accounting Principles and Internal
Control Matters |
1. The Committee shall advise management, including the
Internal Audit Department, and the independent auditor that they
are expected to provide the Committee with a timely analysis of
significant financial reporting, accounting, or internal control
matters.
2. The Committee shall make or cause to be made, from time
to time, such other examinations or reviews as the Audit
Committee may deem advisable with respect to the adequacy of the
systems of internal controls and accounting practices of VF and
its subsidiaries and with respect to current accounting trends
and developments, and take such action with respect thereto as
may be deemed appropriate.
3. The Committee shall review the status of compliance with
laws, regulations, and internal procedures, contingent
liabilities and risks that may be material to VF, the scope and
A-3
status of systems designed to assure VF compliance with laws,
regulations and internal procedures, through receiving reports
from management, legal counsel and other third parties as
determined by the Audit Committee on such matters, as well as
major legislative and regulatory developments which could
materially impact VFs contingent liabilities and risks.
4. The Committee shall establish and maintain procedures
for the confidential and anonymous receipt, retention and
treatment of complaints regarding VFs accounting, internal
controls or auditing matters.
E. Qualified Legal Compliance
Committee
1. In its capacity as VFs qualified legal compliance
committee (QLCC), the Committee shall review any
report made directly, or otherwise made known, to it by
attorneys employed or retained by VF or its subsidiaries of a
material violation of U.S. federal or state securities law,
a material breach of fiduciary duty arising under
U.S. federal or state law or a similar material violation
of any U.S. federal or state law (a material
violation), all in accordance with the provisions of
17 CFR Part 205, as amended from time to time
(Part 205). The Committee shall also review and
consider reports made in accordance with VFs Professional
Conduct Policy.
2. When any member of the Committee receives a report of
evidence of a material violation or any report under VFs
Professional Conduct Policy of a possible violation of law (a
report), such member shall bring such matter to the
Chairman. The Chairman shall document the receipt and substance
of the report in a log and maintain a copy of any written report
received. The Chairman shall then promptly bring the report to
the attention of the full Committee.
3. Upon receipt of a report, the Committee shall
(a) inform VFs chief legal officer (CLO)
and chief executive officer (CEO) (or the
equivalents thereof) of such report unless such notification
would be futile; and (b) determine whether an investigation
is necessary regarding any report of evidence of a material
violation by VF, its subsidiaries or any of their officers,
directors, employees or agents.
4. If the Committee determines an investigation is
necessary or appropriate, the Committee shall (a) notify
the full board of directors; (b) initiate an investigation,
which may be conducted either by the CLO or by outside
attorneys; and (c) retain such expert personnel as the
Committee deems necessary.
5. At the conclusion of any such investigation, the
Committee shall: (a) recommend that VF implement an
appropriate response to the evidence of a material violation;
and (b) inform the CLO, the CEO and the Board of the
results of any such investigation initiated by the Committee and
the appropriate remedial measures to be adopted.
6. The Committee may take all other appropriate action,
including notifying the SEC, if VF fails in any material respect
to implement an appropriate response that the Committee has
recommended for adoption by VF.
7. The Committee, when acting as the QLCC, may act only by
majority vote.
A-4
F. Annual Evaluation
The Committee shall annually evaluate its performance.
|
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V. |
Resources and Authority |
The Committee may authorize or conduct investigations into any
matters within the scope of its responsibilities. The Committee
shall have the authority to call before it management and other
employees of VF involved in financial or internal control
matters. Further, the Committee shall have the power (without
seeking Board approval) to engage such financial and internal
control experts, including independent public accountants other
than VFs independent auditor, counsel, including counsel
other than VFs regular counsel, and other consultants as
it deems reasonably necessary to assist it in carrying out its
responsibilities.
In accordance with the Corporations By-Laws and the
Pennsylvania Business Corporation Law of 1988, as amended, the
Committee shall not have any power or authority as to the
following:
1. The submission to shareholders of any action requiring
approval of shareholders under the Pennsylvania Business
Corporation Law of 1988, as amended;
2. The creation or filling of vacancies in the Board;
3. The adoption, amendment or repeal of the By-Laws;
4. The amendment or repeal of any resolution of the Board
that by its terms is amendable or repealable only by the
Board; or
5. The action on matters committed by the By-Laws or
resolution of the Board to another committee of the Board.
The Committee shall periodically review the provisions of this
Charter and recommend at that time, or at any other time, any
changes to the Board.
A-5
APPENDIX B
V.F. CORPORATION
INDEPENDENCE STANDARDS OF THE BOARD OF DIRECTORS
To be considered independent under the Listing Standards of the
NYSE, the Board must determine that a director does not have any
direct or indirect (as a partner, shareholder or officer of an
organization that has a relationship with VF) material
relationship with VF by broadly considering all relevant facts
and circumstances. Material relationships can include
commercial, industrial, banking, consulting, legal, accounting,
charitable and familial relationships, among others. The
Boards determination of each directors independence
will be disclosed annually in the Companys proxy
statement. The Board has established the following categorical
standards to assist it in determining director independence in
accordance with the NYSE rules:
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No director who is an employee, or whose immediate family member
is an executive officer, of VF can be considered independent
until three (3) years after termination of such employment
relationship. |
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No director who is affiliated with or employed by, or whose
immediate family member is affiliated with or employed in a
professional capacity by, a present or former internal or
external auditor of the company can be considered independent
until three (3) years after the end of the affiliation or
employment or auditing relationship. |
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No director can be considered independent if he or she is
employed, or if his or her immediate family member is employed,
as an executive officer of another company where any of
VFs present executives serve on the other companys
compensation committee until three years after the end of such
service or employment relationship. |
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No director can be considered independent if he or she receives,
or his or her immediate family member receives, more than
$100,000 per year in direct compensation from the Company,
other than director and committee fees and pension or other
forms of deferred compensation for prior service (provided such
compensation is not contingent in any way on continued service)
until three years after he or she or his or her immediate family
member ceases to receive more than $100,000 per year in
such compensation. |
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No director can be considered independent if he or she is an
executive officer or employee of another company not including a
charitable organization (or an immediate family member of the
director is an executive officer of such company) that makes
payments to, or receives payments from, VF for property or
services in an amount which, in any single fiscal year, exceeds
the greater of $1 million or 2% of such other
companys consolidated gross revenues until three years
after falling below such threshold. |
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VF will disclose, in its annual proxy statement, any charitable
contributions made by VF to a charitable organization if the
charitable organization is one in which a VF director serves as
an executive officer and, within the preceding three years,
charitable contributions made by VF in any single fiscal year
exceed the greater of $1 million or 2% of such charitable
organizations consolidated gross revenues. This |
B-1
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disclosure does not automatically result in a determination
against that directors independence; however, the Board
will consider the materiality of this relationship in its
overall affirmative determination of that directors
independence status. |
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The Board, as part of its self-evaluation will review all
commercial, industrial, banking, consulting, legal, accounting,
charitable, and familial relationships between the Company and
its directors. |
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For relationships not qualifying within the above guidelines,
the determination of whether the relationship is material, and
therefore whether the director is independent, shall be made by
the Board. The Company will explain in the next proxy statement
the basis for any Board determination that a relationship was
immaterial despite the fact that it did not meet the categorical
standards of immateriality set forth in the above guidelines. |
In addition, members of the Audit Committee of the Board are
subject to heightened standards of independence under the NYSE
rules and the SEC rules and regulations.
B-2
C/O EQUISERVE TRUST COMPANY N.A.
P.O. BOX 8099
EDISON, NJ 08818-8099
Dear Shareholder:
VF Corporation encourages you to take advantage of one of the convenient ways to vote your shares.
You can vote 24 hours a day, 7 days a week, using either a touch-tone telephone or through the
Internet. To vote your shares by telephone or the Internet, you must have this proxy/voting
instruction card in hand. YOUR INTERNET OR TELEPHONE VOTE MUST BE RECEIVED BY 11:59 P.M., EASTERN
DAYLIGHT TIME, ON APRIL 25, 2005.
Your vote is important. Please vote immediately.
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Vote-by-Internet
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To vote on the Internet, go to the web site
http://www.eproxyvote.com/vfc |
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Vote-by-Telephone
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To vote over the telephone, dial 1-877-PRXVOTE
(1-877-779-8683). Shareholders outside of the U.S.
and Canada should call 1-201-536-8073. |
Your telephone or Internet vote authorizes the proxies named on the above proxy/voting
instruction card in the same manner as if you had marked, signed, dated, and returned the
proxy/voting instruction card. IF YOU CHOOSE TO VOTE TELEPHONICALLY OR THROUGH THE INTERNET, THERE
IS NO NEED TO MAIL BACK YOUR PROXY/VOTING INSTRUCTION CARD.
Your vote is important. Thank you for voting.
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
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Please mark your
votes as in
this example. |
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Shares subject to this proxy/voting instruction card will be voted in the manner indicated
below, when the card is properly executed and returned. If no indication is made, such shares will
be voted FOR the election of all nominees as Directors and FOR ratification of the selection of the
independent auditors. For participants in the VF Corporation employee benefit plans: This card will
be treated as voting instructions to the plan trustees or administrator, as explained on the
detachable portion of the card. |
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The Board of Directors recommends a vote FOR Item No. 1 and Item No. 2. |
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1 Election of Directors.
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FOR
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WITHHELD |
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FOR
ALL
NOMINEES
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WITHHELD
FROM ALL
NOMINEES |
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FOR ALL NOMINEES EXCEPT AS WRITTEN ABOVE |
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FOR
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AGAINST
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ABSTAIN |
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Ratification of the selection of
PricewaterhouseCoopers LLP as VFs
independent auditors for the fiscal year
ending December 31, 2005.
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I will attend the Annual Meeting.
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Change of address/comments
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TO VOTE BY MAIL, Please sign, date and return
your proxy promptly in the enclosed envelope.
No postage required if mailed in the United
States.
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NOTE:
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Please sign name(s) exactly as printed
hereon. Joint owners should each sign.
When signing as attorney, executor,
administrator, trustee or guardian,
please give full title as such. |
Signature:______________________________ Date: _____________ Signature: ______________________________ Date: _____________
Voting Instructions for the VF Corporation Tax-Advantaged Savings Plan
for Salaried Employees (the Salaried 401(k)):
This card constitutes voting instructions to Fidelity Management Trust Company, the Trustee for the
Salaried 401(k), to vote in person or by proxy any shares of Common Stock and Series B ESOP
Convertible Preferred Stock allocated to the undersigned as of March 8, 2005 under the Salaried
401(k), at the Annual Meeting of Shareholders of VF Corporation to be held on April 26, 2005, and
at any adjournments thereof, and also constitutes voting instructions to the Trustee for a
proportionate number of shares of Common Stock and Series B ESOP Convertible Preferred Stock in the
Salaried 401(k) for which no instruction card has been received from other participants. If you do
not return this card, the Trustee will vote any shares allocated to you in the same proportion as
the shares for which instructions were received from other participants in the Salaried 401(k).
Voting Instructions for the VF Corporation Tax-Advantaged Savings Plan
for Hourly Employees (the Hourly 401(k)):
This card also constitutes voting instructions to Fidelity Management Trust Company, the Trustee
for the Hourly 401(k), to vote in person or by proxy any shares of Common Stock allocated to the
undersigned as of March 8, 2005 under the Hourly 401(k), at the Annual Meeting of Shareholders of
VF Corporation to be held on April 26, 2005, and at any adjournments thereof, and also constitutes
voting instructions to the Trustee for a proportionate number of shares of Common Stock in the
Hourly 401(k) for which no instruction card has been received from other participants. If you do
not return this card, the Trustee will vote any shares allocated to you in the same proportion as
the shares for which instructions were received from other participants in the Hourly 401(k).
Voting Request for the VF Executive Deferred Savings Plan (the EDSP):
This card constitutes a voting request to the VF Corporation Pension Plan Committee (the
Committee), Administrator of the EDSP, to vote the VF Corporation shares held by the trustee of
the grantor trust relating to the EDSP and credited to the participants EDSP account as of March
8, 2005, at the Annual Meeting of Shareholders of VF Corporation to be held on April 26, 2005, and
at any adjournments thereof, with the understanding that the Committee, pursuant to its
discretionary powers under the EDSP, may reject this request and direct that the shares be voted in
a contrary manner.
DETACH HERE
PROXY SOLICITATION/VOTING INSTRUCTION CARD
VF CORPORATION
Proxy Solicited on Behalf of the Board of Directors for
Annual Meeting on April 26, 2005
The undersigned hereby appoints M.J. McDonald and C.S. Cummings, and each of them acting
individually, proxies of the undersigned, with full power of substitution, to represent and vote,
as directed on the reverse side of this card, all shares of Common Stock of VF Corporation held of
record by the undersigned on March 8, 2005, at the Annual Meeting of Shareholders of VF Corporation
to be held on April 26, 2005, and at any adjournments thereof, and, in their discretion, upon such
other matters not specified as may come before said meeting. The undersigned hereby revokes any
prior proxies.
Election of Directors, Nominees for a 3-year term:
01 Juan Ernesto de Bedout, 02 Ursula O. Fairbairn, 03 Barbara S. Feigin, 04 Mackey J. McDonald
You are encouraged to specify your choice by marking the appropriate boxes, SEE REVERSE SIDE, but
you need not mark any boxes if you wish to vote in accordance with the Board of Directors
recommendations.
UNLESS YOU VOTE BY TELEPHONE, INTERNET, OR BY SIGNING AND RETURNING THIS CARD, THE PROXIES
CANNOT VOTE YOUR SHARES.
PLEASE VOTE, DATE AND SIGN THIS PROXY ON THE OTHER SIDE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
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HAS YOUR ADDRESS CHANGED?
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DO YOU HAVE ANY COMMENTS? |
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VOTING REQUEST
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To: VF Corporation Pension Plan Committee (the Committee), Administrator
of the VF Deferred Savings Plan for Non-Employee Directors (the Plan) |
As a participant in the Plan with certain Deferrals being credited with gains and losses as if
invested in the VF Corporation Common Stock Fund, and in accordance with the Committees procedures
permitting each such participant the right to request that the VF shares held by the trustee of the
grantor trust relating to the Plan and credited to the participants Plan account at the record
date be voted in a specific manner, I hereby request that my VF shares so credited be voted, in
person or by proxy, in the manner shown below:
ELECTION OF DIRECTORS
The Board of Directors of the Corporation recommends a vote FOR the election of all
nominees as Directors.
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Nominees:
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For a 3-year term: |
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Juan Ernesto de Bedout, Ursula O. Fairbairn,
Barbara S. Feigin and Mackey J. McDonald. |
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VOTE FOR all nominees listed above,
except vote withheld from individual
nominees as follows:
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VOTE WITHHELD
from all nominees |
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RATIFICATION OF THE SELECTION OF PRICEWATERHOUSECOOPERS LLP AS VFS INDEPENDENT AUDITORS FOR THE
FISCAL YEAR ENDING DECEMBER 31, 2005.
The Board of Directors of the Corporation recommends a vote FOR ratification of the
selection of the independent auditors.
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FOR
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AGAINST
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ABSTAIN |
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I understand that if I return this form properly signed but do not otherwise specify my
choices, this will be deemed to be a request to vote FOR the election of all nominees as Directors
and FOR ratification of the selection of the independent auditors.
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Signature of Participant:
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IMPORTANT: Please sign and date
these instructions exactly as your
name appears hereon.
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PLEASE SIGN, DATE AND RETURN
THESE INSTRUCTIONS PROMPTLY
IN THE ENCLOSED ENVELOPE. NO
POSTAGE REQUIRED IF MAILED IN
THE UNITED STATES. |
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