-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, ELvqyazgYDXnCi8yLASCwvK0YZ1MhYgDUuBBR0MN4pP5eo7XO6V4fS9tNsJ0xVtP hSdsWU9RxTii1bcCpDE51w== 0001047469-03-032942.txt : 20031008 0001047469-03-032942.hdr.sgml : 20031008 20031008163337 ACCESSION NUMBER: 0001047469-03-032942 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20031008 GROUP MEMBERS: CHARLES BARRY GROUP MEMBERS: CHARMEL ENTERPRISES, INC. GROUP MEMBERS: CHARMEL LIMITED PARTNERSHIP GROUP MEMBERS: JESS M. RAVICH GROUP MEMBERS: MELANIE BARRY GROUP MEMBERS: OAK RIDGE CAPITAL GROUP, INC. GROUP MEMBERS: RICHARD FITZGERALD GROUP MEMBERS: ROBERT C. KLAS, SR. GROUP MEMBERS: THE TEMPLE COMPANY, L.L.P. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CONE MILLS CORP CENTRAL INDEX KEY: 0000023304 STANDARD INDUSTRIAL CLASSIFICATION: BROADWOVEN FABRIC MILLS, COTTON [2211] IRS NUMBER: 560367025 STATE OF INCORPORATION: NC FISCAL YEAR END: 1229 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-33752 FILM NUMBER: 03933599 BUSINESS ADDRESS: STREET 1: SUITE 300 STREET 2: 804 GREEN VALLEY ROAD CITY: GREENSBORO STATE: NC ZIP: 27408 BUSINESS PHONE: 3363796220 MAIL ADDRESS: STREET 1: 804 GREEN VALLEY RD, STE 300 STREET 2: PO BOX 26540 CITY: GREENSBORO STATE: NC ZIP: 27415-6540 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: KOZBERG MARC H CENTRAL INDEX KEY: 0001072668 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 90 SOUTH SEVENTH STREET STREET 2: SUITE 4400 CITY: MINNEAPOLIS STATE: MN ZIP: 55402-4115 BUSINESS PHONE: 6123767035 MAIL ADDRESS: STREET 1: 90 SOUTH SEVENTH STREET STREET 2: SUITE 4400 CITY: MINNEAPOLIS STATE: MN ZIP: 55402-4115 SC 13D/A 1 a2120019zsc13da.htm SCHEDULE 13D/A
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D
(Amendment No. 25)

Under the Securities Exchange Act of 1934

CONE MILLS CORPORATION
(Name of Issuer)

Common Stock, $.10 par value
(Title of Class of Securities)

206814 10 5
(CUSIP Number)

Albert A. Woodward, Esq.
Leonard, Street And Deinard, P.A.
150 South Fifth Street
Suite 2300
Minneapolis, Minnesota 55402
(612) 335-1500
(Name, Address and Telephone Number
of Person Authorized to Receive
Notices and Communications)

October 8, 2003
(Date of Event which Requires Filing
of this Statement)

        If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box o.

(Cover page continued on next 0 pages)

INTRODUCTION

        The Holders originally filed a Schedule 13D relating to Cone Mills Corporation (the "Issuer") on December 28, 1998. The original filing was amended on January 19, 1999, February 16, 1999, March 9, 1999, June 15, 1999, September 30, 1999, November 4, 1999, March 9, 2000, July 14, 2000, December 22, 2000, March 28, 2001, April 26, 2001, June 6, 2001, November 13, 2001, February 7, 2002, June 7, 2002, November 26, 2002, February 5, 2003, March 3, 2003, March 5, 2003, March 24, 2003, July 15, 2003, August 7, 2003, August 20, 2003 and October 1, 2003. This filing is the twenty-fifth amendment to the original Schedule 13D filing.

        The Holders' responses to Items 1 and 3 remain unchanged, and the Holders hereby restate the information contained in the original filing and subsequent amendments thereto for those items.


ITEM 2. IDENTITY AND BACKGROUND

        This statement is filed jointly by the individuals and entities identified below (collectively the "Holders"). There have been no changes in the identity, background, occupations, or addresses of the Holders since the filing of the last Schedule 13D Amendment to which this filing is an amendment. However, Oak Ridge Capital Group, Inc. has resigned from the Section 13(d) group

    1.
    Marc H. Kozberg

    2.
    The Temple Company, L.L.P.

    3.
    Charmel Limited Partnership

    4.
    Charmel Enterprises, Inc.

    5.
    Richard Fitzgerald

    6.
    Charles Barry

    7.
    Melanie Barry

    8.
    Robert C. Klas, Sr.

    9.
    Oak Ridge Capital Group, Inc.

    10.
    Jess M. Ravich

        During the last five years, none of the Holders has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors), nor has any Holder been a party to a civil proceeding where, as a result of such proceeding, a Holder became subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.


ITEM 4. PURPOSE OF TRANSACTION.

        The Holders' disclosures under Item 4 in their twenty-fourth amendment to Schedule 13D are incorporated hereby. Reference is also made to the letter from certain Holders, in their capacity as directors of the Issuer, to other directors of the issuer, attached hereto as Exhibit 99.1.

2



ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.

        Information with respect to the aggregate number, and percentage, of all outstanding Common Stock beneficially owned as of October 8, 2003 by each of the Holders is set forth below:

Name
   Number of Shares
of Common Stock
   Percentage of
Outstanding Shares
  
Marc H. Kozberg(4)   252,500   1.0 %
The Temple Company, L.L.P.   242,160   0.9 %
Charmel Limited Partnership   977,200   3.8 %
Charmel Enterprises, Inc.(2)   977,200   3.8 %
Richard Fitzgerald(1)   242,160   0.9 %
Charles Barry(1)(2)(3)   1,444,360   5.6 %
Melanie Barry(2)   977,200   3.8 %
Robert C. Klas, Sr.   550,000   2.1 %
Jess M. Ravich(5)   464,400   1.8 %
(1)
Includes 242,160 shares of Common Stock owned by The Temple Company, L.L.P.

(2)
Includes 977,200 shares of Common Stock owned by Charmel Limited Partnership.

(3)
Includes 225,000 shares of Common Stock held by Wells Fargo Bank, as Trustee of the Twin Cities Fan & Blower Co. Profit Sharing Plan FBO Charles Barry.

(4)
Includes 2,000 shares of Common Stock purchasable under currently exercisable options and 50,500 shares owned directly by Oak Ridge Capital Group, Inc., of which Mr. Kozberg is Chief Executive Officer. The terms of the options are described in Item 6 hereto.

(5)
Includes 464,400 shares held by Ravich Revocable Trust of 1989, a revocable trust of which Mr. Ravich is a trustee.

        The Holders' responses to Items 7 through 13 of the cover pages of the statement are incorporated herein by reference. Cover pages have been included in this filing only to the extent a Holder's beneficial ownership in the securities of the Issuer has changed since the most recent filing of a Schedule 13D amendment to which this statement is an amendment.

        According to the Issuer's most recent Form 10-Q filing with the SEC, the Issuer had 25,941,475 shares of Common Stock outstanding as of July 23, 2003. The Holders, as of October 8, 2003, collectively beneficially own 2,709,260 shares of the Issuer's Common Stock and options to purchase 2,000 shares of the Issuer's Common Stock, constituting, in the aggregate, approximately 10.5% of the Issuer's outstanding voting Common Stock.

        The Holders have previously disclosed all of their transactions in Issuer equity securities.


ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO THE ISSUER.

        See prior amendments to Schedule 13D.


ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.

        Exhibit A—Agreement as to joint filing pursuant to Regulation Section 240.13d-1(k)(1)(iii).

        Exhibit B—Sharing and Consent Agreement *

        Exhibit C—Power of Attorney (Richard Fitzgerald) *

        Exhibit D—Power of Attorney (Melanie Barry) *

3


        Exhibit E—Form of Option Agreement **

        Exhibit 99.1 Letter from Sub-committee of Independent Directors to Other Directors, dated October 8, 2003.

*
Attached as exhibits to Amendment No. 17 to this Schedule 13D, filed February 5, 2003.

**
Filed as Exhibit 10.10 to the Issuer's annual report on Form 10-K for the year ended January 2, 1994.

4


SIGNATURES

        After reasonable inquiry, and to the best of each of the undersigned's knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

        Dated: October 8, 2003

            Oak Ridge Capital Group, Inc.

/s/  MARC H. KOZBERG      
Marc H. Kozberg
 
By:
 
/s/  MARC H. KOZBERG      
Marc H. Kozberg,
 Chief Executive Officer

THE TEMPLE COMPANY, L.L.P.
 
 
 
 

By:
 
*
Charles Barry, a partner
 
*
Jess M. Ravich

CHARMEL LIMITED PARTNERSHIP
 
 
 
 

By:
 
Charmel Enterprises, Inc.
 
*By
 
Marc H. Kozberg, Attorney-in-Fact

 
 
By:
 
*
Charles Barry, President
 
 
 
 

CHARMEL ENTERPRISES, INC.
 
 
 
 

By:
 
*
Charles Barry, President
 
 
 
 

 
 
*
Richard Fitzgerald
 
 
 
 

 
 
*
Charles Barry
 
 
 
 

 
 
*
Melanie Barry
 
 
 
 

 
 
*
Robert C. Klas, Sr.
 
 
 
 


EXHIBIT A


AGREEMENT AS TO JOINT FILING

        Pursuant to Regulation Section 240.13d-1(k)(1)(iii), the undersigned acknowledge and agree that the attached Schedule 13D Amendment relating to Cone Mills Corporation is being filed on behalf of each of the undersigned.


/s/  MARC H. KOZBERG      
Marc H. Kozberg
 
By:
 
/s/  MARC H. KOZBERG      
Marc H. Kozberg,
 Chief Executive Officer

THE TEMPLE COMPANY, L.L.P.
 
 
 
 

By:
 
*
Charles Barry, a partner
 
*
Jess M. Ravich

CHARMEL LIMITED PARTNERSHIP
 
 
 
 

By:
 
Charmel Enterprises, Inc.
 
*By
 
Marc H. Kozberg, Attorney-in-Fact

 
 
By:
 
*
Charles Barry, President
 
 
 
 

CHARMEL ENTERPRISES, INC.
 
 
 
 

By:
 
*
Charles Barry, President
 
 
 
 

 
 
*
Richard Fitzgerald
 
 
 
 

 
 
*
Charles Barry
 
 
 
 

 
 
*
Melanie Barry
 
 
 
 

 
 
*
Robert C. Klas, Sr.
 
 
 
 


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SIGNATURES
AGREEMENT AS TO JOINT FILING
 EX-99.1 3 a2120019zex-99_1.htm EXHIBIT 99.1
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Exhibit 99.1

Sub-Committee of
Independent Directors
of Cone Mills Corporation
701 Xenia Avenue South
Golden Valley, MN 55416

Via Facsimile

October 8, 2003

The Board of Directors of
Cone Mills Corporation
804 Green Valley Road, Suite 300
P.O. Box 26540
Greensboro, North Carolina 27415-6540

To The Board of Directors:

        As you know, at the recent annual shareholders meeting of Cone Mills Corporation (the "Company") held on September 25, 2003, Messrs. Charles Barry, Randall Kominsky and Jess Ravich were elected to the Board of Directors of the Company (the "Board"). Together we comprise a majority of the Company's seven independent directors.

        The Company has recently taken a number of actions that raise serious issues regarding (i) the Company's compliance with applicable laws (including both North Carolina law and the federal securities laws), (ii) management's self-interest in crucial corporate transactions and (iii) the Board's compliance with its fiduciary duties. Specifically, in connection with the recent annual shareholders meeting, the Company:

    •
    Improperly postponed the date of the meeting in violation of Section 3-2 of the Company's bylaws.

    •
    Adopted lucrative "golden parachute" packages for the Chairman of the Board and 23 members of his management team without providing the Board with adequate information or time and without adequate disclosure of these golden parachutes in the Company's proxy materials.

    •
    Created a Special Committee of the Board that has effectively supplanted the entire Board for the purpose of disenfranchising the shareholders who elected Messrs. Barry, Kominsky and Ravich to the Board, again with no disclosure whatsoever in the Company's proxy materials.

    •
    Delegated to this Special Committee expansive powers in connection with the Company's restructuring and consideration of strategic alternatives in a manner inconsistent with the purpose, if not the terms, of Section 55-8-25 of the North Carolina Business Corporation Act (the "Corporation Act") and Section 6-2 of the Company's bylaws.

    •
    Rushed to file a Chapter 11 bankruptcy petition before the new directors joined the Board, again in order to disenfranchise the shareholders who voted for these new directors and again with no disclosure whatsoever in the Company's proxy materials.

    •
    We note that if the Company's financial condition was so dire as to make a bankruptcy filing necessary, this fact should have been disclosed in the Company's SEC filings. However, as late as the filing of the Company's second quarter Form 10-Q with the SEC on August 13, 2003, the Company failed to disclose that bankruptcy or insolvency was a possibility.

    •
    Has continually withheld material information from the new directors despite a written request for the information and despite an obligation to provide information to these directors to permit them to satisfy their obligations as directors.
    •
    Entered into a letter of intent with WL Ross & Co. LLC (together with its affiliates "WL Ross"), which contemplates a sale of substantially all of the Company's assets to WL Ross, without fully exploring all strategic alternatives available to the Company to maximize recoveries by the Company's creditors and shareholders and without permitting the independent directors to satisfy their duty of due care by:

    •
    Exploring all available restructuring and strategic options.

    •
    Receiving advice from objective, independent advisors selected by these directors.

    •
    Evaluating management's self-interest in the transaction.

        We note that the agenda for this Thursday's Board meeting, which we received only yesterday, indicates that the Board will consider and be asked to approve a "W.L. Ross stalking horse purchase agreement" at the meeting, despite the fact that neither the agreement nor a summary will be provided to the directors in advance and the directors will obviously not have the time or the information to fully understand the agreement's terms.

        The Company seems intent on pressing ahead with a deal with WL Ross when we have offered a restructuring proposal that offers greater recoveries for the Company's creditors and possibly its stockholders. Our plan has the following elements:

    •
    Dispose of the Company's unprofitable Cone Jacquards and Cone Finishing businesses and its unproductive real estate holdings.

    •
    Use the proceeds from these sales to pay down debt and refinance the remaining debt on more favorable terms.

    •
    Explore the sale of the Company's interest in the Parras Cone joint venture while retaining the associated profitable marketing and management agreement.

    •
    Our restructuring plan would increase the likelihood of a recovery by the Company's ESOP, which holds a substantial amount of the Company's preferred stock.

        The foregoing actions by the Company and the incumbent Board evidence a course of conduct that is inconsistent with the current focus on proper corporate governance and disclosure. This course of conduct is the type of corporate behavior that has been heavily criticized by government agencies, prosecutors, courts, academics and journalists, and which poses serious liability risks for the Company and its directors and officers.

        Accordingly, we hereby request that the Board take the following actions as soon as possible:

    •
    Appoint a special committee of the Board comprised of the independent directors (Messrs. Barry, Griffin, Kominsky, Kozberg, Ravich, Reid and Wilson) and authorize the committee, to the extent permitted by the Corporation Act and the Company's bylaws, to assume control of the Company's restructuring process and review of strategic alternatives;

    •
    Authorize this committee to retain its own legal, financial, accounting and other advisors; and

    •
    Grant the members of this committee full access to the Company's books, records, personnel, accountants and other advisors so they can fully inform themselves of all relevant information regarding the Company, its financial condition and all restructuring and strategic alternatives.

        We would appreciate your response to this letter as soon as possible and in no event later than 12:00 noon, New York time, on Thursday, October 9, 2003. If you have any questions regarding the foregoing, please do not hesitate to contact any of us. We look forward to hearing from you.

    Sincerely,

 
 
/s/  CHARLES L. BARRY      
Charles L. Barry

 
 
/s/  RANDALL G. KOMINSKY      
Randall G. Kominsky

 
 
/s/  MARC H. KOZBERG      
Marc H. Kozberg

 
 
/s/  JESS M. RAVICH      
Jess M. Ravich
cc:
Stephen Fraidin—Kirkland & Ellis LLP
Richard L. Wynne—Kirkland & Ellis LLP


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