<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended May 2, 1998
Commission file number 001-13143
BJ'S WHOLESALE CLUB, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 04-3360747
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Mercer Road
Natick, Massachusetts 01760
(Address of principal executive offices) (Zip Code)
(508) 651-7400
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No .
--- ---
The number of shares of the Registrant's common stock outstanding as of May
30, 1998: 37,670,640
<PAGE>
<TABLE>
PART I FINANCIAL INFORMATION
BJ'S WHOLESALE CLUB, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
Thirteen Weeks Ended
-----------------------
May 2, April 26,
1998 1997
----------- ----------
(Dollars in Thousands
except Per Share Amounts)
<S> <C> <C>
Net sales $754,752 $664,258
Membership fees and other 18,636 14,689
-------- --------
Total revenues 773,388 678,947
-------- --------
Cost of sales, including buying and occupancy costs 693,579 612,199
Selling, general and administrative expenses 61,464 51,374
Pension termination costs 1,521 -
-------- --------
Operating income 16,824 15,374
Interest on debt and capital leases (net) 132 3,882
-------- --------
Income before income taxes 16,692 11,492
Provision for income taxes 6,510 4,435
-------- --------
Net income $ 10,182 $ 7,057
======== ========
Net income per common share:
Basic and diluted $ 0.27 $ 0.19
======== ========
Number of common shares for earnings per share
computations:
Basic 37,577,777 37,484,937
Diluted 38,232,036 37,484,937
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
BJ'S WHOLESALE CLUB, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<CAPTION>
May 2, January 31, April 26,
1998 1998 1997
----------- ----------- -----------
(Dollars in Thousands)
<S> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 8,227 $ 12,713 $ -
Marketable securities 95 - -
Accounts receivable 28,274 38,322 22,320
Merchandise inventories 343,434 332,274 317,056
Current deferred income taxes 7,048 6,826 6,186
Prepaid expenses 12,070 14,050 5,312
--------- --------- ---------
Total current assets 399,148 404,185 350,874
--------- --------- ---------
Property at cost:
Land and buildings 290,594 282,619 270,265
Leasehold costs and improvements 42,859 42,541 34,831
Furniture, fixtures and equipment 211,146 207,127 188,243
--------- --------- ---------
544,599 532,287 493,339
Less accumulated depreciation
and amortization 147,265 140,216 114,822
--------- --------- ---------
397,334 392,071 378,517
--------- --------- ---------
Property under capital leases 6,219 6,219 6,219
Less accumulated amortization 1,825 1,784 1,659
--------- --------- ---------
4,394 4,435 4,560
--------- --------- ---------
Other assets 10,379 10,945 10,385
--------- --------- ---------
Total assets $ 811,255 $ 811,636 $ 744,336
========= ========= =========
LIABILITIES
Current liabilities:
Accounts payable $ 206,598 $ 200,386 $ 187,158
Accrued expenses and other
current liabilities 58,870 71,648 58,736
Accrued federal and state
income taxes 3,604 7,009 9,508
Obligations under capital leases
due within one year 189 185 174
--------- --------- ---------
Total current liabilities 269,261 279,228 255,576
--------- --------- ---------
Long-term debt 37,000 42,500 -
Obligations under capital leases,
less portion due within one year 2,387 2,430 2,553
Other noncurrent liabilities 36,099 36,396 28,269
Deferred income taxes 5,067 4,825 3,485
Loans and advances from Waban Inc. - - 171,789
STOCKHOLDERS' EQUITY
Common stock, par value $.01,
authorized 180,000,000 shares,
issued and outstanding 37,665,432,
37,504,214 and 37,484,937 shares 377 375 375
Additional paid-in capital 107,408 102,408 -
Retained earnings 353,656 343,474 282,289
--------- --------- ---------
Total stockholders' equity 461,441 446,257 282,664
--------- --------- ---------
Total liabilities and
stockholders' equity $ 811,255 $ 811,636 $ 744,336
========= ========= =========
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
BJ'S WHOLESALE CLUB, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Thirteen Weeks Ended
--------------------
May 2, April 26,
1998 1997
--------- ---------
(Dollars in Thousands)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $10,182 $ 7,057
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization of property 9,913 9,092
Loss on property disposals 34 128
Other noncash items (net) 40 -
Deferred income taxes 20 303
Increase (decrease) in cash
due to changes in:
Accounts receivable 10,048 11,686
Merchandise inventories (11,160) (21,840)
Prepaid expenses 1,980 779
Other assets 554 (247)
Accounts payable 6,212 (12,866)
Accrued expenses (7,575) (4,393)
Accrued income taxes (3,405) (2,923)
Other noncurrent liabilities (297) (197)
------- -------
Net cash provided by (used in) operating
activities 16,546 (13,421)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of marketable securities (95) -
Property additions (20,521) (10,293)
Property disposals 149 34
------- -------
Net cash used in investing activities (20,467) (10,259)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of capital lease obligations (39) (28)
Repayment of long-term debt (5,500) -
Proceeds from sale and issuance of common stock 3,786 -
Contribution to capital by Waban Inc. 1,188 -
Increase in loans and advances from Waban Inc. - 23,708
------- -------
Net cash provided by (used in) financing
activities (565) 23,680
------- -------
Net decrease in cash and cash equivalents (4,486) -
Cash and cash equivalents at beginning of year 12,713 -
------- -------
Cash and cash equivalents at end of period $ 8,227 $ -
======= =======
Supplemental cash flow information:
Interest paid $ 230 $ 3,891
Income taxes paid 9,895 7,055
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
BJ'S WHOLESALE CLUB, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited)
<CAPTION>
(Dollars in Thousands except Per Share Amounts)
----------------------------------------------
Common
Stock Additional Total
Par Value Paid-In Retained Stockholders'
$.01 Capital Earnings Equity
---------- ---------- --------- ------------
<S> <C> <C> <C> <C>
Balance, January 25, 1997 $ 375 $ - $275,232 $275,607
Net income - - 7,057 7,057
---- ------- ------- -------
Balance, April 26, 1997 $ 375 $ - $282,289 $282,664
==== ======= ======= =======
Balance, January 31, 1998 $ 375 $102,408 $343,474 $446,257
Net income - - 10,182 10,182
Sale and issuance of common
stock 2 3,812 - 3,814
Contribution to capital by
Waban Inc. - 1,188 - 1,188
---- ------- ------- -------
Balance, May 2, 1998 $ 377 $107,408 $353,656 $461,441
==== ======= ======= =======
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BJ's Wholesale Club, Inc. ("BJ's" or the "Company"), which previously had
been a wholly owned subsidiary of Waban Inc. ("Waban"), became a separate and
independent public entity on July 28, 1997, when Waban distributed to its
stockholders on a pro rata basis all of the Company's outstanding common
stock (the "spin-off"). The financial statements of the Company include the
financial statements of those subsidiaries of Waban which, prior to the spin-
off, operated Waban's BJ's Wholesale Club Division.
As of July 26, 1997, Waban transferred all of the assets and liabilities of
its BJ's Wholesale Club Division to the Company and contributed all of the
Company's intercompany debt of $101.3 million to the Company's equity.
The historical capitalization of the Company was retroactively restated to
reflect the issuance of 37,484,937 shares of common stock, the number of
shares of the Company's common stock distributed to Waban's stockholders on
July 28, 1997.
2. The results for the first three months are not necessarily indicative of
the results for the full fiscal year because, among other things, the
Company's business, in common with the business of retailers generally, is
subject to seasonal influences. The Company's sales and operating income
have typically been strongest in the Christmas holiday season and lowest in
the first quarter of each fiscal year.
3. The interim financial statements are unaudited and reflect all normal
recurring adjustments considered necessary by the Company for a fair
presentation of its financial statements in accordance with generally
accepted accounting principles.
4. These interim financial statements should be read in conjunction with the
consolidated financial statements and related notes contained in the
Company's Annual Report on Form 10-K for the fiscal year ended January 31,
1998.
5. Interest on debt and capital leases (net) included interest on
intercompany indebtedness to Waban of $3.9 million in the three months ended
April 26, 1997.
Selling, general and administrative expenses included certain
allocations of overhead incurred by Waban that supported the Company's
business prior to the spin-off. These allocated expenses totaled $1.2
million in the three months ended April 26, 1997.
6. Under Waban's cash management system, checks issued by its divisions but
not yet presented to banks resulted in overdraft balances for accounting
purposes in certain periods. The Company had an overdraft balance of $8.5
million as of April 26, 1997, which is included in accrued expenses and other
current liabilities on the balance sheet.
7. Effective July 26, 1997, Waban's Board of Directors approved the
termination of the Waban Inc. Retirement Plan, in which certain of the
Company's employees participated. In accordance with generally accepted
accounting principles, the costs to terminate the Plan were not recognized
until the Plan was settled, which occurred in this year's first quarter.
Accordingly, during the quarter ended May 2, 1998, the Company recorded a
pre-tax charge of $1.5 million in connection with the settlement of the Plan.
On a post-tax basis, this charge amounted to $.9 million, or $.02 per share.
8. The following details the calculation of earnings per share for the
periods presented below:
<TABLE>
<CAPTION>
Thirteen Weeks Ended
-----------------------------
May 2, April 26,
1998 1997
----- --------
<S> <C> <C>
Net income $10,182,000 $ 7,057,000
=========== ===========
Weighted-average number of common
shares outstanding, used for basic
computation 37,577,777 37,484,937
Plus: Incremental shares from assumed
conversion of stock options 654,259 -
----------- -----------
Weighted-average number of common
and dilutive potential common
shares outstanding 38,232,036 37,484,937
=========== ===========
Basic and diluted net income per
common share $0.27 $0.19
===== =====
</TABLE>
9. The Company operated 87 clubs on May 2, 1998 versus 80 clubs on April 26,
1997.
10. Certain amounts in the prior year's financial statements have been
reclassified for comparative purposes.
<PAGE>
Management's Discussion and Analysis
of Financial Condition and Results of Operations
Thirteen Weeks (First Quarter) Ended May 2, 1998 versus Thirteen Weeks Ended
April 26, 1997.
Results of Operations
- ---------------------
Net sales for the first quarter ended May 2, 1998 rose 13.6% to $755 million
from $664 million reported in last year's first quarter. This increase was
due to the opening of new stores and to a comparable store sales increase of
6.0%. This year's first quarter sales benefited from a mild winter and
warmer-than-normal early spring weather, which generated strong seasonal
sales.
Total revenues in the first quarter included membership fees of $16.6 million
versus $13.0 million in last year's first quarter, an increase of 27.1%.
This year's results benefited from an increase in the membership fee for
"Inner Circle" members from $30.00 to $35.00, effective February 1, 1998.
Business membership fees were not changed.
Cost of sales (including buying and occupancy costs) was 91.9% of net sales
in this year's first quarter versus 92.2% in the comparable period last year.
This improvement reflected the leveraging of certain fixed buying and
occupancy costs on strong comparable store sales and slightly higher
merchandise gross margins.
Selling, general and administrative ("SG&A") expenses were 8.1% of net sales
in the first quarter versus 7.7% in last year's comparable period. This
increase was attributable mainly to higher credit, marketing and preopening
costs, as well as increased expenses incurred as a result of the Company
operating as a separate, publicly owned entity. Higher credit expenses were
due both to the strong acceptance of VISA by BJ's members and to increased
costs for the Company's co-branded MasterCard. Increased marketing costs
were incurred to support the Company's entry into the Cleveland, Ohio, market
and higher preopening expenses resulted from opening three new clubs during
the first quarter of this year compared with no new clubs in the same period
last year.
Effective July 26, 1997, Waban Inc.'s Board of Directors approved the
termination of the Waban Inc. Retirement Plan, in which certain of the
Company's employees participated. In accordance with generally accepted
accounting principles, the costs to terminate the Plan were not recognized
until the Plan was settled, which occurred in this year's first quarter.
Accordingly, during the quarter ended May 2, 1998, the Company recorded a
pre-tax charge of $1.5 million in connection with the settlement of the Plan.
On a post-tax basis, this charge amounted to $.9 million, or $.02 per share.
The components of net interest expense were as follows (in thousands):
<TABLE>
<CAPTION>
Thirteen Weeks Ended
---------------------
May 2, April 26,
1998 1997
---- ----
<S> <C> <C>
Interest expense on debt $ 197 $3,820
Interest income (133) (9)
------ ------
Interest on debt (net) 64 3,811
Interest on capital leases 68 71
------ ------
Interest on debt and capital leases (net) $ 132 $3,882
====== ======
</TABLE>
Interest expense on debt was net of capitalized interest of $133,000 in this
year's first quarter and $80,000 in last year's first quarter. As described
in more detail below, the decrease in interest expense in this year's first
quarter as compared to last year's first quarter is due to significantly
lower borrowing levels and interest rates applied to those borrowings.
The Company's first quarter provision for income taxes was 39.0% of pre-tax
income this year versus 38.6% in last year's first quarter.
Net income for the first quarter rose to $10.2 million, or $.27 per share,
from $7.1 million, or $.19 per share, in last year's first quarter.
BJ's Wholesale Club, Inc. commenced operations as a separate entity
immediately following its July 28, 1997 spin-off from Waban Inc. Therefore,
reported financial results through the first half of 1997 reflect BJ's
historical position as a division of Waban Inc. and, as such, may not be
indicative of performance after the spin-off. As a separate, publicly owned
company, BJ's is incurring corporate overhead costs approximately $.5 million
per quarter higher than the amounts included in the historical financial
statements for periods preceding the spin-off. However, interest on
intercompany borrowings at an annual rate of 10% prior to the spin-off has
been replaced by interest on bank borrowings at an assumed rate of
approximately 6.5% per year, and the level of debt has been reduced
substantially by the contribution to capital of $101.3 million of BJ's
intercompany debt in connection with the spin-off. Restating last year's
historical results for these changes, and reflecting common stock equivalents
expected to be included in earnings per share calculations after the spin-off,
and excluding this year's pension termination charge, first quarter net
income rose 34.7% to $11.1 million from $8.2 million in the first quarter of
1997; diluted earnings per share rose 31.8% to $.29 compared with $.22 in the
first quarter of 1997; and operating income rose 23.3% to $18.3 million from
$14.9 million in the first quarter of 1997.
Over the remainder of the year, the Company expects to continue to benefit
from the increase in Inner Circle membership fees, but this benefit is
expected to be largely offset by the same factors that affected the first
quarter, namely higher preopening costs (resulting from a significant
increase over last year in the number of planned new club openings),
increased credit expenses and a higher-than-usual level of marketing expenses
to support the Company's entry into the Cleveland market. The impact of
these factors will vary from quarter to quarter due to, among other things,
timing issues associated with membership fee revenue, new club openings and
the cycling of the Company's acceptance of VISA. Additionally, the Company
will not benefit from the impact of the 53-week fiscal year, as it did in
1997.
The Company has worked for several years to prepare its financial,
merchandising and other computer-based systems for the Year 2000. The
Company estimates that its Year 2000 implementation effort was approximately
80% complete at the end of 1997 and will be substantially complete by the end
of 1998 without any material adverse effect on its results of operations,
financial position or cash flows. Additionally, the Company is working with
key vendors and other third parties with whom it does business to minimize
the potential adverse impact on the Company if they fail to address the Year
2000 issue successfully. There can be no assurance that the third parties
with whom the Company does business will be successful in addressing the Year
2000 issue or that any such failure to successfully address the issue will
not have an adverse effect on the Company's financial condition and results
of operations.
Seasonality
- -----------
The Company's business, in common with the business of retailers generally,
is subject to seasonal influences. The Company's sales and operating income
have typically been strongest in the Christmas holiday season and lowest in
the first quarter of each fiscal year.
Recent Accounting Standards
- ---------------------------
The Accounting Standards Executive Committee of the American Institute of
Certified Public Accountants issued Statement of Position ("SOP") 98-1,
"Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use," in March 1998 and SOP 98-5, "Reporting on the Costs of Start-Up
Activities," in April 1998.
SOP 98-1 provides guidance as to whether certain internal-use software costs
should be capitalized as a long-lived asset or expensed when incurred and
becomes effective in the Company's fiscal year ending January 29, 2000, but
may be adopted earlier. The Company is in the process of evaluating the
requirements of SOP 98-1, but does not expect that it will materially affect
its results of operations, financial position or cash flows. The Company has
not yet decided whether it will adopt this standard in 1998.
SOP 98-5 provides guidance on the financial reporting of start-up costs and
organization costs and also becomes effective in the Company's fiscal year
ending January 29, 2000, but may be adopted earlier. This pronouncement will
change the way the Company accounts for preopening costs incurred in
connection with opening a facility. The Company currently charges preopening
costs to operations within the fiscal year that a new facility opens,
amortizing such costs between the date the facility opens and the end of the
fiscal year. SOP 98-5 will require all preopening costs to be expensed when
incurred. The general effect of SOP 98-5 on the Company will be to
accelerate the recognition of preopening expenses. The initial application
of SOP 98-5 must be reported as a cumulative effect of a change in accounting
principle. The Company has not yet decided whether it will adopt this
standard in 1998.
Since June 1997, Statement of Financial Accounting Standards ("SFAS") No.
130, "Reporting Comprehensive Income," SFAS No. 131, "Disclosures about
Segments of an Enterprise and Related Information," and SFAS No. 132,
"Employers' Disclosure about Pensions and Other Postretirement Benefits,"
were issued. These statements become effective in the Company's current
fiscal year ending January 30, 1999. The adoption of these statements is
expected to have no material impact on the Company's results of operations,
financial position or cash flows and to produce no major changes in current
disclosures.
Liquidity and Capital Resources
- -------------------------------
Net cash provided by operating activities was $16.5 million in the first
quarter of 1998. A total of $13.4 million was used in operating activities
in last year's comparable period. The increase in cash provided by operating
activities was attributable primarily to a lower accounts payable-to-inventory
ratio at the beginning of this year, as compared to the beginning
of last year.
Cash expended for property additions was $20.5 million in the first quarter
of 1998 versus $10.3 million in the first quarter of 1997. The Company
opened three new clubs in this year's first quarter, including the Company's
first club in the Cleveland market. No new clubs were opened in last year's
first quarter.
The Company's capital expenditures are expected to total approximately $100
million in 1998, based on opening a total of twelve to thirteen new clubs,
including the expected opening of approximately three new clubs in the
Cleveland market. The timing of actual club openings and the amount of
related expenditures could vary from these estimates due, among other things,
to the complexity of the real estate development process.
Prior to the spin-off, the Company's operations and expansion were financed
through loans advanced by Waban as needed. In July 1997, the Company entered
into a $200 million unsecured credit agreement with a group of banks which
expires July 9, 2002. The agreement, which was amended in December 1997,
includes a $50 million sub-facility for letters of credit, of which $13.8
million was outstanding at May 2, 1998. The Company is required to pay an
annual facility fee which is currently 0.125% of the total commitment.
Interest on borrowings is payable at the Company's option either at (a) the
Eurodollar rate plus a margin which is currently 0.275%, (b) the agent bank's
prime rate or (c) a rate determined by competitive bidding. The facility fee
and Eurodollar margin are both subject to change based upon the Company's
fixed charge coverage ratio. The agreement contains covenants which, among
other things, include minimum net worth and fixed charge coverage
requirements and a maximum funded debt-to-capital limitation, and which
prohibit the payment of cash dividends on the Company's common stock.
The Company also maintains a separate line in the amount of $30 million for
letters of credit, primarily to support the purchase of inventories, of which
$8.5 million was outstanding at May 2, 1998, and an additional $20 million
uncommitted credit line for short-term borrowings.
Cash and cash equivalents totaled $8.2 million as of May 2, 1998. Borrowings
as of May 2, 1998 consisted of $18 million under the Company's bank credit
agreement and $19 million under its uncommitted credit line. The Company
expects that its current resources, together with anticipated cash flow from
operations, will be sufficient to finance its operations through January 30,
1999. However, the Company may from time to time seek to obtain additional
financing.
Factors Which Could Affect Future Operating Results
- ---------------------------------------------------
This report contains a number of "forward-looking statements," including
statements regarding expenses expected to be incurred by BJ's as a stand-alone
entity, planned capital expenditures, planned store openings and other
information with respect to the Company's plans and strategies. Any
statements contained herein that are not statements of historical fact may be
deemed to be forward-looking statements. Without limiting the foregoing, the
words "believes," "anticipates," "plans," "expects" and similar expressions
are intended to identify forward-looking statements. There are a number of
important factors that could cause actual events or the Company's actual
results to differ materially from those indicated by such forward-looking
statements, including, without limitation, economic and weather conditions
and state and local regulation in the Company's markets; competitive
conditions; the ability of the Company to continue its transition to being a
stand-alone entity; contingent liabilities under the Company's
indemnification agreement with The TJX Companies, Inc.; and events which
might cause the Company's spin-off from Waban not to qualify for tax-free
treatment. Each of these factors is discussed in more detail in the
Company's Annual Report on Form 10-K for the fiscal year ended January 31,
1998.
Other factors which could affect future operating results of the Company
include, without limitation, the successful implementation of the Company's
Year 2000 remediation plans and new club opening plans discussed above.
Quantitative and Qualitative Disclosures About Market Risk
- ----------------------------------------------------------
Not applicable.
<PAGE>
PART II. OTHER INFORMATION
Item 2 - Changes in Securities
---------------------
On May 28, 1998, the Board of Directors amended the By-Laws of the
Company to allow a stockholder to vote at all stockholder meetings
by written proxy executed in writing by the stockholder or his or
her attorney-in-fact or in such other manner permitted by the
General Corporation Law of the State of Delaware. Previously,
every proxy was required to be signed by the stockholder or by
his or her attorney-in-fact.
Item 4 - Submission of Matters to a Vote of Security Holders
---------------------------------------------------
At the 1998 Annual Meeting of Stockholders of the Company (the
"Annual Meeting") held on May 28, 1998, the re-election of S. James
Coppersmith, Thomas J. Shields and Herbert J. Zarkin was acted
upon by the stockholders of the Company.
The number of shares of common stock outstanding and entitled to
vote at the Annual Meeting was 37,643,962. The other directors
of the Company, whose terms of office as directors continued
after the Annual Meeting, are Kerry L. Hamilton, Allyn L. Levy,
John J. Nugent, Lorne R. Waxlax and Edward J. Weisberger.
Subsequent to the Annual Meeting, Bert N. Mitchell was elected as
a new director of the Company by the Board of Directors to fill a
vacancy created by the expansion of the size of the Board on May
28, 1998. The results of the voting on the re-election of direct-
ors are set forth below:
<TABLE>
<CAPTION>
Votes Votes Votes Absten- Broker
For Withheld Against tions Non-Votes
----- -------- ------- ------- ---------
<S> <C> <C> <C> <C> <C>
Election of Directors:
S. James Coppersmith 31,706,074 444,532 N/A N/A N/A
Thomas J. Shields 31,708,609 441,997 N/A N/A N/A
Herbert J. Zarkin 31,687,618 462,988 N/A N/A N/A
</TABLE>
Item 6 - Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
3.2 Amended and Restated By-Laws
27.0 Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K with the
Securities and Exchange Commission during the quarter ended
May 2, 1998.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BJ'S WHOLESALE CLUB, INC.
-------------------------
(Registrant)
Date: June 11, 1998 /S/ JOHN J. NUGENT
------------- -------------------------
John J. Nugent
President and Chief Executive Officer
(Principal Executive Officer)
Date: June 11, 1998 /S/ FRANK D. FORWARD
------------- -------------------------
Frank D. Forward
Executive Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the BJ's
Wholesale Club, Inc. consolidated statements of income and consolidated
balance sheets filed with the Form 10-Q for the quarter ended May 2, 1998
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-30-1999
<PERIOD-END> MAY-2-1998
<CASH> 8,227
<SECURITIES> 95
<RECEIVABLES> 28,274
<ALLOWANCES> 0
<INVENTORY> 343,434
<CURRENT-ASSETS> 399,148
<PP&E> 550,818
<DEPRECIATION> 149,090
<TOTAL-ASSETS> 811,255
<CURRENT-LIABILITIES> 269,261
<BONDS> 39,387
<COMMON> 377
0
0
<OTHER-SE> 461,064
<TOTAL-LIABILITY-AND-EQUITY> 811,255
<SALES> 754,752
<TOTAL-REVENUES> 773,388
<CGS> 693,579
<TOTAL-COSTS> 693,579
<OTHER-EXPENSES> 62,985
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 132
<INCOME-PRETAX> 16,692
<INCOME-TAX> 6,510
<INCOME-CONTINUING> 10,182
<DISCONTINUED> 0
<EXTRAORDINARY> 0
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<PAGE>
APPROVED MAY 28, 1998
BY-LAWS
OF
BJ'S WHOLESALE CLUB, INC.
SECTION 1. LAW, CERTIFICATE OF INCORPORATION AND BY-LAWS
1.1. These by-laws are subject to the Certificate of
Incorporation of the Corporation. In these by-laws, references
to law, the Certificate of Incorporation and by-laws mean the
law, the provisions of the Certificate of Incorporation of the
Corporation and these by-laws as from time to time in effect.
SECTION 2. STOCKHOLDERS
2.1. Annual Meeting. The annual meeting of stockholders
--------------
shall be held at such date and time as shall be designated by the
Board of Directors and stated in the notice of the meeting, at
which meeting the stockholders shall elect directors and transact
such other business as may be required by law or these by-laws or
as may properly come before the meeting.
At any annual meeting of stockholders, only such business
shall be conducted as shall have been brought before the annual
meeting (i) by or at the direction of the Board of Directors or
(ii) by any stockholder who complies with the procedures set
forth below in this paragraph. For business properly to be
brought by a stockholder before an annual meeting, the
stockholder must have given timely notice thereof in proper
written form to the secretary. To be timely, a stockholder's
notice must be delivered to, or mailed and received by, the
secretary at the principal executive offices of the Corporation
not less than 70 days nor more than 90 days prior to the first
anniversary of the preceding year's annual meeting; provided,
however, that in the event that the date of the annual meeting is
advanced by more than 20 days, or delayed by more than 70 days,
from such anniversary date, notice by the stockholder to be
timely must be so delivered or received not earlier than the
ninetieth day prior to such annual meeting and not later than the
close of business on the later of the seventieth day prior to
such annual meeting or the tenth day following the day on which
public announcement of the date of such meeting is first made.
To be in proper written form, a stockholder's notice shall set
forth in writing as to each matter the stockholder proposes to
bring before the annual meeting: (i) a brief description of the
business desired be brought before the annual meeting and the
reasons for conducting such business at the annual meeting; (ii)
the name and address, as they appear on the Corporation's books,
of the stockholder proposing such business; (iii) the person or
persons who are the beneficial owner of such shares, if different
in any respect from the record owner; (iv) the class and number
of shares of the Corporation which are beneficially owned by the
stockholder and any other persons referred to in the preceding
clause (iii); and (v) any material interest of the stockholder or
such other persons in such business. The chairman of the annual
meeting shall, if the facts warrant, determine that business was
not properly brought before the annual meeting in accordance with
the provisions of this Section 2.1 and, if he should so
determine, he shall so declare to the annual meeting and any such
business not properly brought before the annual meeting shall not
be transacted.
2.2. Special Meetings. Subject to the provisions of any
----------------
series of preferred stock or any other securities of the
Corporation with respect to the voting of such series or such
other securities, a special meeting of the stockholders may be
called only by notice given by the chairman, the president or a
majority of the Board of Directors. Only such business as is
specified in the notice of a special meeting of stockholders
shall come before such meeting. Any such notice shall state the
place, date, hour and purposes of the meeting.
2.3. Place of Meeting. All meetings of the stockholders
----------------
shall be held at such place within or without the State of
Delaware as may be determined from time to time by the chairman,
the president or the Board of Directors. Any adjourned session
of any meeting of the stockholders shall be held at the place
designated in the vote of adjournment.
2.4. Notice of Meetings. Except as otherwise provided by
------------------
law, a written notice of each meeting of stockholders stating the
place, day and hour thereof and, in the case of a special
meeting, the purposes for which the meeting is called, shall be
given not less then ten nor more than 60 days before the meeting,
to each stockholder entitled to vote thereat, and to each
stockholder who, by law, by the Certificate of Incorporation or
by these by-laws, is entitled to notice, by leaving such notice
with him or at his residence or usual place of business, or by
depositing it in the United States mail, postage prepaid, and
addressed to such stockholder at his address as it appears in the
records of the Corporation. Such notice shall be given by the
secretary, or by an officer or person designated by the Board of
Directors, or in the case of a special meeting by the officer
calling the meeting or by the Board of Directors, as the case may
be. As to any adjourned session of any meeting of stockholders,
notice of the adjourned meeting need not be given if the time and
place thereof are announced at the meeting at which the
adjournment was taken except that if the adjournment is for more
than 30 days or if after the adjournment a new record date is set
for the adjourned session, notice of any such adjourned session
of the meeting shall be given in the manner heretofore described.
No notice of any meeting of stockholders or any adjourned session
thereof need be given to a stockholder if a written waiver of
notice, executed before or after the meeting or such adjourned
session by such stockholder, is filed with the records of the
meeting or if the stockholder attends such meeting without
objecting at the beginning of the meeting to the transaction of
any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the
purpose of, any meeting of the stockholders or any adjourned
session thereof need be specified in any written waiver of
notice.
2.5. Quorum of Stockholders. At any meeting of the
----------------------
stockholders a quorum as to any matter shall consist of a
majority of the votes entitled to be cast on the matter, except
where a larger quorum is required by law, by the Certificate of
Incorporation or by these by-laws. Any meeting may be adjourned
from time to time by a majority of the votes properly cast upon
the question, whether or not a quorum is present. If a quorum is
present at an original meeting, a quorum need not be present at
an adjourned session of that meeting. Shares of its own stock
belonging to the Corporation or to another corporation, if a
majority of the shares entitled to vote in the election of
directors of such other corporation is held, directly or
indirectly, by the Corporation, shall neither be entitled to vote
nor be counted for quorum purposes; provided, however, that the
foregoing shall not limit the right of any such corporation to
vote stock held by it in a fiduciary capacity.
2.6. Action by Vote. When a quorum is present at any
--------------
meeting, a plurality of the votes properly cast for election to
any office shall elect to such office and a majority of the votes
properly cast upon any question other than an election to an
office shall decide the question, except when a larger vote is
required by law, by the Certificate of Incorporation or by these
by-laws. No ballot shall be required for any election unless
requested by a stockholder present or represented at the meeting
and entitled to vote in the election.
2.7. Proxy Representation. Every stockholder may authorize
--------------------
another person or persons to act for him by proxy in all matters
in which a stockholder is entitled to participate, whether by
waiving notice of any meeting, objecting to or voting or
participating at a meeting or expressing consent or dissent
without a meeting. At all meetings of stockholders, a
stockholder may vote by proxy executed in writing (or in such
other manner permitted by the General Corporation Law of the
State of Delaware) by the stockholder, or by such person's duly
authorized attorney-in-fact. No proxy shall be voted or acted
upon after three years from its date unless such proxy provides
for a longer period. A duly executed proxy shall be irrevocable
if it states that it is irrevocable and, if, and only as long as,
it is coupled with an interest sufficient in law to support an
irrevocable power. A proxy may be made irrevocable regardless of
whether the interest with which it is coupled is an interest in
the stock itself or an interest in the Corporation generally.
The authorization of a proxy may but need not be limited to
specified action; provided, however, that if a proxy limits its
authorization to a meeting or meetings of stockholders, unless
otherwise specifically provided such proxy shall entitle the
holder thereof to vote at any adjourned session but shall not be
valid after the final adjournment thereof.
2.8. Inspectors. The Board of Directors or the chairman of
----------
the meeting shall appoint one or more inspectors of election and
any substitute inspectors to act at the meeting or any
adjournment thereof. Each inspector, before entering upon the
discharge of his duties, shall take and sign an oath faithfully
to execute the duties of inspector at such meeting with strict
impartiality and according to the best of his ability. The
inspectors shall determine the number of shares of stock
outstanding and the voting power of each, the shares of stock
represented at the meeting, the existence of a quorum, the
validity and effect of proxies, and shall receive votes, ballots
or consents, hear and determine all challenges and questions
arising in connection with the right to vote, count and tabulate
all votes, ballots or consents, determine the result, and do such
acts as are proper to conduct the election or vote with fairness
to all stockholders. On request of the chairman of the meeting,
the inspectors shall make a report in writing of any challenge,
question or matter determined by them and execute a certificate
of any fact found by them.
2.9. List of Stockholders. The secretary shall prepare and
--------------------
make available, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to
vote at such meeting, arranged in alphabetical order and showing
the address of each stockholder and the number of shares
registered in his name. The stock ledger shall be the only
evidence as to who are stockholders entitled to examine such list
or to vote in person or by proxy at such meeting.
SECTION 3. BOARD OF DIRECTORS
3.1. Number. Except as otherwise fixed by or pursuant to
------
the Certificate of Incorporation, the number of directors which
shall constitute the whole board shall be determined from time to
time by vote of a majority of the Board of Directors, provided
that the number thereof may not be less than three.
3.2. Tenure. Except as otherwise provided by law, by the
------
Certificate of Incorporation or by these by-laws, the directors,
other than those who may be elected upon specified circumstances
by the holders of shares of any series of Preferred Stock or any
other securities of the Corporation, shall be classified, with
respect to the time for which they severally hold office, into
three classes as nearly equal in number as possible: one class
whose term expires at the annual meeting of stockholders to be
held in calendar 1998, another class whose term expires at the
annual meeting of stockholders to be held in calendar 1999 and
another class whose term expires at the annual meeting of
stockholders to be held in calendar 2000, with each class to hold
office until its successors are elected and qualified. The
classes (and the membership of each class) shall be initially
comprised as provided in the Certificate of Incorporation. If
the number of directors is changed by the Board of Directors, any
newly created directorships or any decrease in directorships
shall be so apportioned among the classes as to make all classes
as nearly equal as possible; provided, however, that no decrease
in the number of directors shall shorten the term of any
incumbent director. At each annual meeting of stockholders,
subject to the aforesaid rights of the holders of any Preferred
Stock or any other securities of the Corporation, the successors
of the class of directors whose term expires at that meeting
shall be elected to hold office for a term expiring at the annual
meeting of stockholders held in the third year following the year
of their election, with such class to hold office until its
successors are elected and qualified. Directors need not be
stockholders.
3.3. Notification of Nominations. Subject to the rights of
---------------------------
the holders of any shares of any series of Preferred Stock or any
other securities of the Corporation to elect directors upon
specified circumstances, nominations for the election of
directors may be made by the Board of Directors or by any
stockholder entitled to vote for the election of directors. Any
stockholder entitled to vote for the election of directors at a
meeting may nominate persons for election as directors by giving
timely notice thereof in proper written form to the secretary.
To be timely, a stockholder's notice must be delivered to, or
mailed and received by, the secretary at the principal executive
offices of the Corporation not less than 70 days nor more than 90
days prior to the first anniversary of the preceding year's
annual meeting; provided, however, that in the event that the
date of the annual meeting is advanced by more than 20 days, or
delayed by more than 70 days, from such anniversary date, notice
by the stockholder to be timely must be so delivered or received
not earlier than the ninetieth day prior to such annual meeting
and not later than the close of business on the later of the
seventieth day prior to such annual meeting or the tenth day
following the day on which public announcement of the date of
such meeting is first made. To be timely, a stockholder's notice
of nominations of persons for election to the Board of Directors
at a special meeting of stockholders at which a vacant newly
created directorship is to be filled must be delivered to the
secretary at the principal executive offices of the Corporation
not earlier than the ninetieth day prior to such special meeting
and not later than the close of business on the later of the
seventieth day prior to such special meeting or the tenth day
following the day on which public announcement is first made of
the date of the special meeting and of the nominees proposed by
the Board of Directors to be elected at such meeting. To be in
proper written form, a stockholder's notice shall set forth in
writing: (a) as to each nominee proposed by such stockholder (i)
the name and address of each nominee, (ii) such other information
regarding each nominee as would have been required to be included
in a proxy statement filed pursuant to Regulation 14A under the
Securities Exchange Act of 1934, as amended (or any successor
provisions of law) had each nominee been nominated, or intended
to be nominated, by the Board of Directors, and (iii) the consent
of each nominee to be named as a nominee and to serve as a
director if so elected; and (b) as to the stockholder giving the
notice (i) the name and address of, and the class and number of
shares of the Corporation held by, the stockholder who intends to
make the nomination and the beneficial owner, if any, on whose
behalf the nomination is being made, (ii) a representation that
the stockholder is a holder of record of stock of the Corporation
entitled to vote at such meeting and intends to appear in person
or by proxy at the meeting to nominate the person or persons
specified in the notice, (iii) a description of all arrangements
or understandings between the stockholder and each nominee and
any other person or persons (naming such person or persons)
pursuant to which the nomination or nominations are to be made by
the stockholder. At the request of the Board of Directors, any
person nominated by the Board of Directors for election as a
director shall furnish to the secretary the information required
to be set forth in a stockholder's notice of nomination which
pertains to the nominee. The Corporation may require any
proposed nominee to furnish such other information as may
reasonably be required by the Corporation to determine the
eligibility of such proposed nominee to serve as a director of
the Corporation. In the event that a stockholder seeks to
nominate one or more directors, the secretary shall appoint one
or more inspectors to determine whether a stockholder has
complied with this Section 3.3. If the inspectors shall determine
that a stockholder has not complied with this Section 3.3, the
inspectors shall direct the chairman of the meeting to declare
to the meeting that a nomination was not made in accordance with
the procedures prescribed by the by-laws, and the chairman shall
so declare to the meeting and the defective nomination shall be
disregarded.
3.4. Powers. The business and affairs of the Corporation
------
shall be managed by or under the direction of the Board of
Directors who shall have and may exercise all the powers of the
Corporation and do all such lawful acts and things as are not by
law, the Certificate of Incorporation or these by-laws directed
or required to be exercised or done by the stockholders.
3.5. Vacancies. Subject to the rights of the holders of any
---------
shares of any series of Preferred Stock or any other securities
of the Corporation to elect directors upon specified
circumstances, any vacancies on the Board of Directors resulting
from death, resignation or removal shall only be filled by the
affirmative vote of a majority of the remaining directors then in
office, even though less than a quorum of the Board of Directors,
or by a sole remaining director, and newly created directorships
resulting from any increase in the number of directors shall be
filled by the Board of Directors, or if not so filled, by the
stockholders at the next annual meeting thereof or at a special
meeting called for that purpose in accordance with these by-laws.
Any director elected in accordance with the preceding sentence
shall hold office for the remainder of the full term of the class
of directors in which the new directorship was created or the
vacancy occurred and until such director's successor shall have
been elected and qualified. The Board of Directors shall have
and may exercise all their powers notwithstanding the existence
of one or more vacancies in their number, subject to any
requirements of law or of the Certificate of Incorporation or of
these by-laws as to the number of directors required for a quorum
or for any vote or other actions.
3.6. Committees. The Board of Directors may (a) designate,
----------
change the membership of or terminate the existence of any
committee or committees, each committee to consist of one or more
of the directors; (b) designate one or more directors as
alternate members of any such committee who may replace any
absent or disqualified member at any meeting of the committee;
and (c) determine the extent to which each such committee shall
have and may exercise the powers of the Board of Directors in the
management of the business and affairs of the Corporation,
including the power to authorize the seal of the Corporation to
be affixed to all papers which require it and the power and
authority to declare dividends or to authorize the issuance of
stock; excepting, however, such powers which by law, by the
Certificate of Incorporation or by these by-laws the Board of
Directors is prohibited from so delegating. In the absence or
disqualification of any member of such committee and his
alternate, if any, the member or members thereof present at any
meeting and not disqualified from voting, whether or not
constituting a quorum, may unanimously appoint another member of
the Board of Directors to act at the meeting in the place of any
such absent or disqualified member. Except as the Board of
Directors may otherwise determine, any committee may make rules
for the conduct of its business, but unless otherwise provided by
the Board or such rules, its business shall be conducted as
nearly as may be in the same manner as is provided by these by-laws
for the conduct of business by the Board of Directors. Each
Committee shall keep regular minutes of its meetings and report
the same to the Board of Directors upon request.
3.7. Regular Meetings. Regular meetings of the Board of
----------------
Directors may be held without call or notice at such places
within or without the State of Delaware and at such times as the
Board of Directors may from time to time determine; provided,
however, that notice of the first regular meeting following any
such determination shall be given to absent directors. In
addition, regular meetings of the Board of Directors may be held
without call or notice immediately after and at the same place as
the annual meeting of stockholders.
3.8. Special Meetings. Special meetings of the Board of
----------------
Directors may be held at any time and at any place within or
without the State of Delaware designated in the notice of the
meeting, when called by the chairman, the president or by a
majority of the directors, reasonable notice thereof being given
to each director by the secretary, the chairman, the president or
any one of the directors calling the meeting.
3.9. Notice. It shall be reasonable and sufficient notice
------
to a director to send notice by mail at least 48 hours or by
telegram at least 24 hours before the meeting addressed to him at
his usual or last known business or residence address or to give
notice to him in person or by telephone at least 24 hours before
the meeting. Notice of a meeting need not be given to any
director if a written waiver of notice, executed by him before or
after the meeting, is filed with the records of the meeting, or
to any director who attends the meeting without protesting prior
thereto or at its commencement the lack of notice to him.
Neither notice of a meeting nor a waiver of a notice need specify
the purposes of the meeting.
3.10. Quorum. Except as may be otherwise provided by law,
------
by the Certificate of Incorporation or by these by-laws, at any
meeting of the Board of Directors a majority of the directors
then in office shall constitute a quorum; a quorum shall not in
any case be less than one-third of the total number of directors
constituting the whole Board of Directors. Any meeting may be
adjourned from time to time by a majority of the votes cast upon
the question, whether or not a quorum is present, and the meeting
may be held as adjourned without further notice.
3.11. Action by Vote. Except as may be otherwise provided
--------------
by law, by the Certificate of Incorporation or by these by-laws,
when a quorum is present at any meeting the vote of a majority of
the directors present shall be the act of the Board of Directors.
3.12. Action Without a Meeting. Any action required or
------------------------
permitted to be taken at any meeting of the Board of Directors or
a committee thereof may be taken without a meeting if all the
members of the Board of Directors or of such committee, as the
case may be, consent thereto in writing, and such writing or
writings are filed with the records of the meetings of the Board
of Directors or of such committee. Such consent shall be treated
for all purposes as the act of the Board of Directors or of such
committee, as the case may be.
3.13. Participation in Meetings by Conference Telephone.
-------------------------------------------------
Members of the Board of Directors, or any committee designated by
the Board of Directors, may participate in a meeting of the Board
of Directors or such committee by means of conference telephone
or similar communications equipment by means of which all persons
participating in the meeting can hear each other or by any other
means permitted by law. Such participation shall constitute
presence in person at such meeting.
3.14. Compensation. In the discretion of the Board of
------------
Directors, each director may be paid such fees for his services
as director and be reimbursed for his reasonable expenses
incurred in the performance of his duties as director as the
Board of Directors from time to time may determine. Nothing
contained in this Section 3.14 shall be construed to preclude any
director from serving the Corporation in any other capacity and
receiving reasonable compensation therefor.
SECTION 4. OFFICERS AND AGENTS
4.1. Enumeration; Qualification. The officers of the
--------------------------
Corporation shall be a chairman, a president, a treasurer, a
secretary and such other officers, if any, as the Board of
Directors from time to time may in its discretion elect or
appoint including without limitation one or more vice presidents
and a controller. The Corporation may also have such agents, if
any, as the Board of Directors from time to time may in its
discretion choose. Any officer may be but none need be a
director or stockholder. Any two or more offices may be held by
the same person. Any officer may be required by the Board of
Directors to secure the faithful performance of his duties to the
Corporation by giving bond in such amount and with sureties or
otherwise as the Board of Directors may determine.
4.2. Powers. Subject to law, to the Certificate of
------
Incorporation and to the other provisions of these by-laws, each
officer shall have, in addition to the duties and powers herein
set forth, such duties and powers as are commonly incident to his
office and such additional duties and powers as the Board of
Directors may from time to time designate.
4.3. Election. The officers may be elected by the Board of
--------
Directors at their first meeting following the annual meeting of
the stockholders or at any other time. At any time or from time
to time the directors may delegate to any officer their power to
elect or appoint any other officer or any agents.
4.4. Tenure. Each officer shall hold office until the first
------
meeting of the Board of Directors following the next annual
meeting of the stockholders and until his respective successor is
chosen and qualified unless a shorter period shall have been
specified by the terms of his election or appointment, or in each
case until he sooner dies, resigns, is removed or becomes
disqualified. Each agent shall retain his authority at the
pleasure of the Board of Directors, or the officer by whom he was
appointed or by the officer who then holds agent-appointive
power.
4.5. Chairman of the Board of Directors; President and Vice
------------------------------------------------------
President. The chairman of the board shall participate in
- ---------
matters of planning and policy, both financial and operational.
The chairman shall preside at all meetings of the stockholders
and of the Board of Directors at which he is present, except that
in the absence of the chairman, or at the request of the
chairman, the president shall preside. The chairman shall have
such other duties and powers as may be designated from time to
time by the Board of Directors.
Each vice chairman, if any, shall have such duties and
powers as shall be designated from time to time by the Board of
Directors.
Unless the Board of Directors otherwise specifies, the
president shall be the chief executive officer and shall have
direct charge of all business operations of the Corporation and,
subject to the control of the Board of Directors, shall have
general charge and supervision of the business of the
Corporation.
Any vice presidents shall have such duties and powers as
shall be set forth in these by-laws or as shall be designated
from time to time by the Board of Directors or by the president.
4.6. Chief Financial Officer; Treasurer and Assistant
------------------------------------------------
Treasurers. The chief financial officer shall be responsible for
- ----------
execution of all financial policies, plans, procedures and
controls of the Company, and the maintenance of books and records
with respect thereto, including accounting and treasury
functions, internal audit, budgets, borrowings, securities
offerings, investments, tax reporting and financial reporting,
all subject to the control of the Board of Directors, the
president and the chairman. The chief financial officer shall
have such other duties and powers as may be designated from time
to time by the Board of Directors, the president or the chairman.
The treasurer shall be in charge of the funds and valuable
papers of the Company and shall have such other duties and powers
as may be designated from time to time by the Board of Directors,
by the president or by the chief financial officer. If no
controller is elected, the treasurer shall, unless the Board of
Directors otherwise specifies, also have the duties and powers of
the controller.
Any assistant treasurers shall have such duties and powers
as shall be designated from time to time by the Board of
Directors, the president or the treasurer.
4.7. Controller and Assistant Controllers. If a controller
------------------------------------
is elected, he or she shall, unless the Board of Directors
otherwise specifies, be the chief accounting officer of the
Corporation and be in charge of its books of account and
accounting records, and of its accounting procedures. The
Controller shall have such other duties and powers as may be
designated from time to time by the Board of Directors, the
president or the treasurer.
Any assistant controller shall have such duties and powers
as shall be designated from time to time by the Board of
Directors, the president, the treasurer or the controller.
4.8. Secretary and Assistant Secretaries. The secretary
-----------------------------------
shall record all proceedings of the stockholders, of the Board of
Directors and of committees of the Board of Directors in a book
or series of books to be kept therefor and shall file therein all
actions by written consent of stockholders or directors. In the
absence of the secretary from any meeting, an assistant
secretary, or if there be none or he is absent, a temporary
secretary chosen at the meeting, shall record the proceedings
thereof. Unless a transfer agent has been appointed, the
secretary shall keep or cause to be kept the stock and transfer
records of the Corporation, which shall contain the names and
record addresses of all stockholders and the number of shares
registered in the name of each stockholder. He shall have such
other duties and powers as may from time to time be designated by
the Board of Directors or the president.
Any assistant secretaries shall have such duties and powers
as shall be designated from time to time by the Board of
Directors, the president or the secretary.
SECTION 5. RESIGNATIONS AND REMOVALS
5.1. Any director or officer may resign at any time by
delivering his resignation in writing to the chairman, the
president, the secretary or to a meeting of the Board of
Directors. Such resignation shall be effective upon receipt
unless specified to be effective at some other time, and without
in either case the necessity of its being accepted unless the
resignation shall so state. Members of the Board of Directors
may be removed only as provided in the Certificate of
Incorporation. The Board of Directors may at any time remove any
officer either with or without cause. The Board of Directors may
at any time terminate or modify the authority of any agent.
SECTION 6. VACANCIES
6.1. If the office of the chairman, the president, the
treasurer or the secretary becomes vacant, the Board of Directors
may elect a successor by vote of a majority of the directors then
in office. If the office of any other officer becomes vacant,
any person or body empowered to elect or appoint that officer may
choose a successor. Each such successor shall hold office for
the unexpired term, and in the case of the president, the
treasurer and the secretary, until a successor is chosen and
qualified or in each case until he or she sooner dies, resigns,
is removed or becomes disqualified. Any vacancy of a
directorship shall be filled as specified in Section 3.5 of these
by-laws.
SECTION 7. CAPITAL STOCK
7.1. Stock Certificates. Each stockholder shall be entitled
------------------
to a certificate stating the number and the class and the
designation of the series, if any, of the shares held by him, in
such form as shall, in conformity to law, the Certificate of
Incorporation and the by-laws, be prescribed from time to time by
the Board of Directors. Such certificate shall be signed by (i)
the chairman or vice chairman, if any, or the president or a vice
president and (ii) the treasurer or an assistant treasurer or the
secretary or an assistant secretary. Any or all of the
signatures on the certificate may be a facsimile. In case an
officer, transfer agent or registrar who has signed or whose
facsimile signature has been placed on such certificate shall
have ceased to be such officer, transfer agent or registrar
before such certificate is issued, it may be issued by the
Corporation with the same effect as if he were such officer,
transfer agent or registrar at the time of its issue.
7.2. Loss of Certificate. In the case of the alleged theft,
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loss, destruction or mutilation of a certificate of stock, a
duplicate certificate may be issued in place thereof, upon such
terms, including receipt of a bond sufficient to indemnify the
Corporation against any claim on account thereof, as the Board of
Directors may prescribe.
SECTION 8. TRANSFER OF SHARES OF STOCK
8.1. Transfer on Books. Subject to the restrictions, if
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any, stated or noted on the stock certificate, shares of stock
may be transferred on the books of the Corporation by the
surrender to the Corporation or its transfer agent of the
certificate therefor properly endorsed or accompanied by a
written assignment and power of attorney properly executed, with
necessary transfer stamps affixed, and with such proof of the
authenticity of signature as the Board of Directors or the
transfer agent of the Corporation may reasonably require. Except
as may be otherwise required by law, by the Certificate of
Incorporation or by these by-laws, the Corporation shall be
entitled to treat the record holder of stock as shown on its
books as the owner of such stock for all purposes, including the
payment of dividends and the right to receive notice and to vote
or to give any consent with respect thereto and to be held liable
for such calls and assessments, if any, as may lawfully be made
thereon, regardless of any transfer, pledge or other disposition
of such stock until the shares have been properly transferred on
the books of the Corporation.
It shall be the duty of each stockholder to notify the
Corporation of his post office address.
8.2. Record Date. In order that the Corporation may
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determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, the Board
of Directors may fix a record date, which record date shall not
precede the date upon which the resolution fixing the record date
is adopted by the Board of Directors, and which record date shall
not be more than 60 nor less than ten days before the date of
such meeting. If no such record date is fixed by the Board of
Directors, the record date for determining the stockholders
entitled to notice of or to vote at a meeting of stockholders
shall be at the close of business on the day next preceding the
day on which notice is given, or, if notice is waived, at the
close of business on the day next preceding the day on which the
meeting is held. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders
shall apply to any adjournment of the meeting; provided, however,
that the Board of Directors may fix a new record date for the
adjourned meeting.
In order that the Corporation may determine the stockholders
entitled to receive payment of any dividend or other distribution
or allotment of any rights or to exercise any rights in respect
of any change, conversion or exchange of stock, or for the
purpose of any other lawful action, the Board of Directors may
fix a record date, which record date shall not precede the date
upon which the resolution fixing the record date is adopted, and
which record date shall be not more than 60 days prior to such
payment, exercise or other action. If no such record date is
fixed, the record date for determining stockholders for any such
purpose shall be at the close of business on the day on which the
Board of Directors adopts the resolution relating thereto.
SECTION 9. CORPORATE SEAL
9.1. Subject to alteration by the Board of Directors, the
seal of the Corporation shall consist of a flat-faced circular
die with the word "Delaware" and the name of the Corporation cut
or engraved thereon, together with such other words, dates or
images as may be approved from time to time by the Board of
Directors.
SECTION 10. EXECUTION OF PAPERS
10.1. Except as the Board of Directors may generally or in
particular cases authorize the execution thereof in some other
manner, all deeds, leases, transfers, contracts, bonds, notes,
checks, drafts or other obligations made, accepted or endorsed by
the Corporation shall be signed by the chairman, the president, a
vice president or the treasurer.
SECTION 11. FISCAL YEAR
11.1. The fiscal year of the Corporation shall end on the
last Saturday of January of each year.
SECTION 12. AMENDMENTS
12.1. Subject to any special voting requirements contained
in the Certificate of Incorporation, these by-laws may be
adopted, amended or repealed by vote of a majority of the entire
Board of Directors at any meeting thereof. The stockholders
shall have the power to amend, alter or repeal any provision of
these by-laws only to the extent and in the manner provided in
the Certificate of Incorporation.
