<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
/X/ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For Quarter Ended June 30, 1995
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________________ to _____________________
Commission file number 1-5325
Huffy Corporation
(Exact name of registrant as specified in its charter)
Ohio 31-0326270
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
225 Byers Road, Miamisburg, Ohio 45342
(Address of principal executive offices) (Zip Code)
(513) 866-6251
(Registrant's telephone number, including area code)
No Change
(Former name, former address and former fiscal year, if changed since last
report)
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
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Outstanding Shares: 13,431,319 as of July 31, 1995
"Index of Exhibits" is page 10 herein Page 1 of 10
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED). COMPANY FOR WHICH REPORT IS FILED:
HUFFY CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollar Amounts in Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
----------------------------- -----------------------------
1995 1994 1995 1994
----------------------------- -----------------------------
<S> <C> <C> <C> <C>
Net sales $ 200,401 $ 214,898 $ 401,054 $ 404,118
Cost of sales 170,545 173,835 334,772 327,069
----------- ----------- ----------- -----------
Gross profit 29,856 41,063 66,282 77,049
Selling, general and
administrative expenses 24,818 26,587 51,824 52,968
Restructuring costs 2,115 -- 2,115 --
----------- ----------- ----------- -----------
Operating profit 2,923 14,476 12,343 24,081
Other expense (income)
Interest expense 2,232 1,362 4,541 3,058
Interest income (23) (53) (66) (80)
Other 53 (21) -- (246)
----------- ----------- ----------- -----------
Earnings before income taxes 661 13,188 7,868 21,349
Income taxes 312 5,227 3,104 8,543
----------- ----------- ----------- -----------
Net earnings 349 7,961 4,764 12,806
=========== =========== =========== ===========
Earnings per common share:
Weighted average
number of common
shares 13,419,071 14,949,562 13,414,229 14,924,480
=========== =========== =========== ===========
Net earnings per
common share $ 0.03 $ 0.53 $ 0.36 $ 0.86
=========== =========== =========== ===========
</TABLE>
See accompanying notes to interim consolidated financial statements.
Page 2 of 10
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HUFFY CORPORATION
CONSOLIDATED BALANCE SHEETS
(Dollar Amounts In Thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1995 1994
------------ --------------
<S> <C> <C>
ASSETS
------
Current assets:
Cash and cash equivalents $ 2,466 $ 1,604
Accounts and notes receivable, net 124,870 105,802
Inventories 70,513 67,954
Prepaid expenses and federal income taxes 13,056 13,938
--------- ---------
Total current assets 210,905 189,298
--------- ---------
Property, plant and equipment, at cost 207,878 192,856
Less accumulated depreciation and amortization (113,462) (103,256)
--------- ---------
Net property, plant and equipment 94,416 89,600
Excess of cost over net assets acquired, net 25,354 25,755
Deferred federal income taxes 8,719 8,719
Other assets 8,553 8,596
--------- ---------
$ 347,947 $ 321,968
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current liabilities:
Notes payable 17,890 --
Current installments of long-term obligations 5,333 5,300
Accounts payable 55,354 43,853
Accrued expenses and other current liabilities 45,390 49,820
--------- ---------
Total current liabilities 123,967 98,973
--------- ---------
Long-term obligations, less current installments 58,567 58,611
Other long-term liabilities 31,585 30,981
--------- ---------
Total liabilities 214,119 188,565
--------- ---------
Shareholders' equity:
Preferred stock -- --
Common stock 16,200 16,166
Additional paid-in capital 60,429 60,155
Retained earnings 93,653 91,089
Less: cost of treasury shares (36,454) (34,007)
--------- ---------
Total shareholders' equity 133,828 133,403
--------- ---------
$ 347,947 $ 321,968
========= =========
</TABLE>
See accompanying notes to interim consolidated financial statements.
Page 3 of 10
<PAGE> 4
HUFFY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar Amounts in Thousands)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
------------------------
1995 1994
------ ------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 4,764 $ 12,806
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Provision for restructuring 2,115 --
Depreciation and amortization 11,682 10,835
(Gain) loss on sale of property, plant and equipment 7 (20)
Changes in assets and liabilities:
Accounts and notes receivable, net (19,068) (40,771)
Inventories (2,559) 20,473
Prepaid expenses and federal income taxes 882 1,532
Other assets (596) (644)
Accounts payable 11,501 18,147
Accrued expenses and other current liabilities (6,564) 4,107
Other long-term liabilities 604 (781)
Other 109 4
-------- --------
Net cash provided by operating activities 2,877 25,688
=========================================================================================================
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (15,477) (12,015)
Proceeds from sale of property, plant and equipment 12 1,625
-------- --------
Net cash used in investing activities (15,465) (10,390)
=========================================================================================================
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in short-term borrowings 17,890 (3,500)
Issuance of long-term obligations 38 39
Reduction of long-term debt (49) (2,514)
Issuance of common shares 308 1,556
Purchase of treasury shares (2,447) (240)
Dividends paid (2,290) (2,504)
-------- --------
Net cash provided by (used in) financing activities 13,450 (7,163)
=========================================================================================================
Net change in cash and cash equivalents 862 8,135
Cash and cash equivalents:
Beginning of period 1,604 4,140
-------- --------
End of period $ 2,466 $ 12,275
=========================================================================================================
</TABLE>
See accompanying notes to interim consolidated financial statements.
Page 4 of 10
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NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(Dollar Amounts in Thousands)
Note 1: Footnote disclosure which would substantially duplicate the
disclosure contained in the Annual Report to Shareholders for the
year ended December 31, 1994 has not been included. The unaudited
interim consolidated financial statements reflect all adjustments
which are, in the opinion of management, necessary to a fair
statement of the results for the periods presented and to present
fairly the consolidated financial position of Huffy Corporation (the
"Company") as of June 30, 1995. All such adjustments are of a normal
recurring nature.
Note 2: Inventories of Huffy Bicycle Company and Huffy Sports Company are
valued using the dollar value LIFO method and, as a result, it is
impractical to separate inventory values between raw materials,
work-in-process and finished products on an interim basis.
Note 3: During the second quarter of 1995, the Company recorded a pre-tax
restructure charge of $2,115, or $.10 per common share. The
restructure plan includes a 25% reduction in the fixed cost
employment structure of Huffy Bicycle Company as well as a 30%
reduction in the Company's corporate staff. The restructure charge
is comprised of severance and outplacement services for approximately
75 employees. As of June 30, 1995, 30 employees had been terminated
and $76 of severance and outplacement had been charged against the
reserve.
Page 5 of 10
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1995
COMPARED TO THE
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1994
(Dollar Amounts in Thousands, Except Per Share Data)
NET EARNINGS
Net earnings for Huffy Corporation ("Huffy" or "Company") for the quarter ended
June 30, 1995 were $349, compared to $7,961 for the same period last year. Net
earnings per share for the second quarter of 1995 were $.03 per common share
compared to $.53 for the second quarter of 1994. Earnings for the second
quarter of 1995 include a charge of $2,115, or $.10 per common share, to
reflect the cost to reduce the fixed cost employment structure at Huffy Bicycle
Company and to reengineer and reduce the Company's corporate office staff. The
remaining decrease in net earnings is due primarily to continued margin
deterioration in the bicycle industry, a continued shift to lower priced
products at retail, and reduced sales margins in all product companies
resulting from soft retail sales.
Net earnings for the six months ended June 30, 1995 were $4,764, compared to
$12,806 for the same period last year. Net earnings per common share for the
six months ended June 30, 1995 were $.36 per common share, compared to $.86 per
common share for the same period last year.
NET SALES
Net sales for the quarter ended June 30, 1995 were $200,401, down 6.7% from
the net sales level of $214,898 for the same quarter in 1994. Net sales
decreased in the Recreation and Leisure Time segment due primarily to the
recent softness at retail and a continued shift to lower specification and
promotionally priced products. The Juvenile Products segment sales decreased
as a result of intensified price and product competition. In the Services for
Retail segment, Huffy Service First sales increased primarily as a result of
continued growth in the consumer product assembly and supplier services
markets.
Net sales for the six months ended June 30, 1995 were $401,054, a 0.8% decrease
from net sales of $404,118 for the same period last year. The decrease in net
sales occurred predominately in
Page 6 of 10
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the Recreation and Leisure Time Products and Juvenile Products segments. Huffy
Bicycle Company net sales were lower than last year due to a soft retail sales
environment, significant pricing competition at the retail level, and continued
dumping of bicycles by the Peoples' Republic of China. Juvenile product sales
were below last year primarily as a result of soft retail during the period.
In the Services for Retail segment, Huffy Service First had record sales due
primarily to growth in the consumer product assembly market segment.
GROSS PROFIT
Gross profit for the quarter ended June 30, 1995 was $29,856, down 27.3% from
the $41,063 achieved in the second quarter of 1994. Expressed as a percentage
of net sales, gross profit for the second quarter of 1995 was 14.9% compared to
19.1% for the second quarter of 1994. Gross profit as a percentage of net
sales decreased for all reportable segments. Within the Recreational and
Leisure Time Products segment, Huffy Bicycle Company continued to experience
declining profit margins caused by a highly competitive retail environment, a
consumer preference for promotional product, and pricing pressure caused by
the continued dumping of bicycles in the USA by the Peoples' Republic of China.
Gross margins declined at Huffy Sports Company as a result of a shift in mix to
lower margin product and increases in material costs. As in the other
segments, soft retail sales and intense price competition caused the gross
profit percentage to decline for the Juvenile Products segment.
Gross profit for the six months ended June 30, 1995 was $66,282, or 16.5% of
net sales, versus $77,049, or 19.1% of net sales, for the same period in 1994.
In the Recreation and Leisure Time Products segment, declining gross margin
percentages at Huffy Bicycle Company and Huffy Sports Company were offset by
continued improvement at True Temper Hardware Company. True Temper Hardware
Company benefited from additional improvements in operating efficiency and
market share gains in the long-handled garden tools segment, as well as a
$1,587 reduction in environmental reserves resulting from the favorable
resolution of certain contractual issues related to the Company's purchase of
True Temper Hardware Company in 1990. In the Juvenile Products segment,
intense competition and a strong commitment to maintain market share caused the
gross profit margin percentage to decline.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses were $24,818 for the second
quarter of 1995, compared to $26,587 for the same period of 1994. Expressed as
a percentage of net sales, selling, general and administrative expenses were
12.4% for the second quarter of both 1995 and
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<PAGE> 8
1994. The decrease in current year selling, general and administrative
expenses is primarily due to reduced accruals for incentive compensation.
Selling, general and administrative expenses for the six months ended June 30,
1995 were $51,824 or 12.9% of net sales, versus $52,968, or 13.1% of net sales
for the same period in 1994. The decrease in selling, general and
administrative expense is primarily due to reduced accruals for incentive
compensation.
RESTRUCTURING COSTS
During the second quarter of 1995, the Company recorded a pre-tax restructure
charge of $2,115, or $.10 per common share. The restructure plan includes a
25% reduction in the fixed cost employment structure of Huffy Bicycle Company
as well as a 30% reduction in the Company's corporate staff. Reductions in the
Company's corporate staff occurred as the result of a desire to reduce fixed
costs, and further decentralize certain functions. Reductions in fixed costs
at Huffy Bicycle Company were made to bring overhead expense in line with
reduced sales levels and to help recover profitability. The restructure charge
is comprised of severance and outplacement services for approximately 75
employees. As of June 30, 1995, 30 employees had been terminated and $76 of
severance and outplacement had been charged against the reserve.
LIQUIDITY AND CAPITAL RESOURCES
There have been no other significant changes in the Company's liquidity and
capital resources as of June 30, 1995 from those discussed in the Company's
Annual Report on Form 10-K for the year ended December 31, 1994. The Company's
balance sheet reflects fluctuations in both current assets and current
liabilities attributable to seasonal changes in the operation of its
businesses.
INTEREST EXPENSE
Interest expense for the second quarter of 1995 was $2,232, which is $870, or
63.9% higher than the second quarter of 1994. Interest expense for the six
months ended June 30, 1995 was $4,541 compared to $3,058 for the same period
last year. The increase in interest expense is due to the following: the
issuance of Industrial Development Revenue Bonds used to finance the
acquisition of the Company's Farmington, Missouri bicycle facility in the third
quarter of 1994; higher average short-term borrowings in 1995; and higher
short-term interest rates in the first six months of 1995 compared to the same
period in 1994.
Page 8 of 10
<PAGE> 9
PART II -- OTHER INFORMATION
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits - The Exhibits, as shown in the "Index of Exhibits",
attached hereto as page 10, are filed as a part of this
Report.
b. No reports on Form 8-K have been filed during the quarter for
which this report is filed.
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.
HUFFY CORPORATION, registrant
August 14, 1995 /s/ Timothy G. Howard
-------------------------------- --------------------------------------
Date Timothy G. Howard
Vice President - Corporate Controller
(Principal Accounting Officer)
Page 9 of 10
<PAGE> 10
INDEX OF EXHIBITS
<TABLE>
<CAPTION>
Exhibit
No. Item
------- -------------------------------------------------------
<S> <C>
(2) Not applicable
(3)(i) Amended Articles of Incorporation of Huffy Corporation
(3)(ii) Code of Regulations of Huffy Corporation
(4) Not applicable
(10) Not applicable
(11) Not applicable
(15) Not applicable
(18) Not applicable
(19) Not applicable
(22) Not applicable
(23) Not applicable
(24) Not applicable
(27) Financial Data Schedule
(99) Not applicable
</TABLE>
Page 10 of 10
<PAGE> 1
Exhibit 3(i)
AMENDED ARTICLES OF INCORPORATION
OF
HUFFY CORPORATION
FIRST: The name of the corporation is HUFFY CORPORATION.
SECOND: The principal office of the corporation in Ohio is located at 225
Byers Road, Miamisburg, Ohio 45342.
THIRD: The purpose of the corporation is to engage in any lawful
act or activity for which corporations may be formed under Sections 1701.01 to
1701.98, inclusive, of the Ohio Revised Code.
FOURTH: SECTION 1. NUMBER, CLASSES AND DESIGNATION OF SHARES.
The corporation shall have authority to issue Cumulative Preferred Stock,
with a par value of $1.00 ("Preferred Stock") and Common Stock, with a par value
of $1.00 ("Common Stock"), as follows:
(a) The maximum number of shares of Preferred Stock which the
corporation is authorized to issue is 1,000,000 shares.
(b) The maximum number of shares of Common Stock which the corporation
is authorized to issue is 60,000,000 shares.
SECTION 2. TERMS AND PROVISIONS OF PREFERRED STOCK.
The express terms of Preferred Stock are as follows:
(a) The Preferred Stock may be issued from time to time in one or more
series as determined by the Board of Directors. All shares of Preferred
Stock shall be of equal rank and shall be identical, except in respect of
the particulars that may be fixed and determined by the Board of Directors
as hereinafter provided, and each share of each series shall be identical
in all respects with all other shares of such series, except as to the date
from which dividends are cumulative. Subject to the provisions of clauses
(b) to (1), inclusive, of this Section, which provisions shall apply to all
Preferred Stock, the Board of Directors is hereby empowered to cause the
Preferred Stock to be issued in one or more series and with respect to each
such series prior to the issuance thereof to fix and determine:
i) the designation of the series, which may be by distinguishing
number, letter or title;
ii) the number of shares of the series, which (except as
otherwise provided by the Board of Directors in creating the series)
may be increased or decreased (but not below the num-
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ber of shares thereof outstanding) by like action of the Board of
Directors;
iii) the annual dividend rate of the series;
iv) the dates on which dividends, if declared, shall be payable,
and the dates from which such dividends shall be cumulative;
v) the redemption rights and price or prices, if any, for shares
of the series;
vi) the amounts payable on shares of the series in the event of
any voluntary or involuntary liquidation, dissolution or winding up of
the affairs of the corporation;
vii) the terms and amount of any sinking fund provided for the
purchase or redemption of shares of the series;
viii) whether the shares of the series shall be convertible into
Common Stock or other securities and, if so, the conversion price or
prices and the adjustments thereof, if any, and all other terms and
conditions upon which such conversion may be made;
ix) restrictions (in addition to those set forth in this Section)
on the issuance of shares of the same series or of any other class or
series;
x) voting rights which may be full, limited or denied, except as
otherwise required by law or the provisions of this Section 2.
The Board of Directors is authorized to adopt from time to time amendments
to the Amended Articles of Incorporation of the corporation fixing and
determining with respect to each such series the matters specified in
subclauses (i) to (x), inclusive, of this clause (a).
(b) The holders of Preferred Stock of each series shall be entitled to
receive, and the corporation shall be bound to pay thereon, but only as and
when declared by the Board of Directors, out of funds legally available for
the payment thereof, cumulative cash dividends at the annual rate fixed by
the Board of Directors for such series as herein authorized, and no more,
payable quarterly on the dates fixed by the Board of Directors for such
series as herein authorized. Such dividends shall be cumulative and shall
be deemed to accrue from day to day regardless of whether or not the
corporation shall have funds legally available for the payment of such
dividends. Such dividends shall be cumulative and shall commence to accrue
on each share of each particular series:
i) from such date, if any, as may be fixed for such series by the
Board of Directors as herein authorized; or
ii) if no such date is fixed and if such share was issued in the
period following a dividend record date fixed for the series of which
it is a part and up to and including the dividend payment date for
which such record was taken, then from such last mentioned date; or
iii) otherwise from the dividend payment date next preceding the
date of issue of such share, or if such share was issued on a dividend
payment date, from such last mentioned date.
Dividends may not be paid on the Preferred Stock of any one series for any
dividend period unless dividends have been paid, or declared and set apart
for payment, on the Preferred Stock of all series for all dividend periods
terminating on the same or an earlier date.
In no event, so long as any Preferred Stock remains outstanding, shall any
dividend, except a dividend payable in Common Stock or other shares ranking
junior to the Preferred Stock, be declared or paid upon, nor shall any
distribution be made or ordered except as aforesaid in respect of, the
Common Stock or any other shares ranking junior to the Preferred Stock, nor
shall any moneys be set aside for or applied to the purchase or redemption
(through a sinking fund or otherwise) of shares of Common Stock or of any
other shares ranking junior to the Preferred Stock, unless (i) all
dividends on the Preferred Stock of all series for all past quar-
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terly dividend periods shall have been paid and the full dividend on all
outstanding shares of Preferred Stock of all series for the then
quarterly dividend period shall have been paid or declared and set
apart for payment, and (ii) the corporation shall have set aside all
amounts, if any, theretofore required to be set aside as and for sinking
funds, if any, for the Preferred Stock of all series for the then current
year, and all defaults, if any, in complying with any such sinking fund
requirement in respect of previous years shall have been made good.
(c) The corporation, at the option of the Board of Directors, may at
any time redeem the whole, or from time to time may redeem any part, of the
Preferred Stock or any series (one or more) thereof at such time or times,
or within such periods, as may be fixed by the Board of Directors for the
particular series as herein authorized, by paying therefor in cash the
amount fixed by the Board of Directors for such series as herein
authorized, such sum being hereinafter in this clause (c) referred to as
the "redemption price"; provided, however, that less than all of the
Preferred Stock may be redeemed only after full cumulative dividends upon
the Preferred Stock then outstanding shall have been paid for all past
quarterly dividend periods and after or concurrently with making payment
of, or declaring or setting apart for payment, the full dividend on all
outstanding shares of Preferred Stock for the then current quarterly
dividend period. If less than all of the outstanding shares of Preferred
Stock are to be called for redemption, redemption may be made of the whole
or any part of the outstanding shares of any one or more series thereof, in
the discretion of the Board of Directors, and if less than all of the
outstanding shares of any series of the Preferred Stock are to be redeemed,
the shares of such series to be redeemed shall be selected by whichever of
the following methods the Board of Directors shall choose: by lot or pro
rata in such manner as may be prescribed by resolution of the Board of
Directors. Not more than sixty (60) days and not less than thirty (30) days
prior to the redemption date, notice of the proposed redemption shall be
mailed to the holders of record of the Preferred Stock to be redeemed, such
notice to be addressed to each such stockholder at his or her last
known post office address shown on the records of the corporation, and the
time of mailing such notice shall be deemed to be the time of the giving
thereof. On or after the date of redemption stated in such notice
(sometimes referred to in this clause (c) as the "redemption date"), each
holder of Preferred Stock called for redemption shall surrender his or
her certificates for such stock to the corporation at the place
designated in such notice and shall thereupon be entitled to receive
payment of the redemption price. In case less than all the shares
represented by any such surrendered certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares. If such
notice of redemption shall have been given as aforesaid, and if on or
before the redemption date funds necessary for the redemption shall have
been set aside so as to be and continue available therefor, then,
notwithstanding that the certificates representing any shares of
Preferred Stock so called for redemption shall not have been surrendered,
the dividends thereon shall cease to accrue after the redemption date, and
all rights with respect to the shares so called for redemption shall
forthwith after such redemption date cease and determine, except only the
right of the holders to receive the redemption price without interest. If
such notice of redemption of all or any part of the Preferred Stock shall
have been mailed as aforesaid and the corporation shall thereafter deposit
money for the payment of the redemption price pursuant thereto with any
bank or trust company (referred to in this clause (c) as the "depository")
in the Borough of Manhattan, City and State of New York, having a combined
capital and surplus of not less than $5,000,000, selected by the Board of
Directors for that purpose, to be applied to such redemption, then from
and after the making of such deposit, such shares shall not be deemed to
be outstanding for any purpose, and the rights of the holders thereof
shall be
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<PAGE> 4
limited to the right to receive payment of the redemption price
(without interest but including accrued dividends to the redemption date)
from the depository upon endorsement, if required, and surrender of the
certificates thereof, provided, however, that no then existing right of
conversion, if any, with respect to such shares shall be impaired by such
deposit until the redemption date. Any moneys so deposited which shall not
be required for such redemption because of the exercise of any such right
of conversion subsequent to the date of deposit shall be returned to the
corporation forthwith. The corporation shall be entitled to receive, from
time to time, from the depository the interest, if any, allowed on such
moneys deposited with it, and the holders of any shares so redeemed shall
have no claim to any such interest. Any moneys so deposited and remaining
unclaimed at the end of six (6) years from the redemption date shall, if
thereafter requested by resolution of the Board of Directors, be repaid to
the corporation, and in the event of such repayment to the corporation,
such holders of record of the shares so called for redemption as shall not
have made claim against such moneys prior to such repayment to the
corporation shall be deemed to be unsecured creditors of the corporation
for an amount equivalent to the amount deposited as above stated for the
redemption of such shares and so repaid to the corporation, but shall in
no event be entitled to any interest.
Subject to the provisions hereof, the Board of Directors shall have
authority to prescribe from time to time the manner in which Preferred
Stock shall be redeemed.
Nothing herein contained shall limit any legal right of the corporation to
purchase any shares of the Preferred Stock; provided, however, that, except
in accordance with an offer (which may vary with respect to shares of
different series) made to all holders of Preferred Stock, the corporation
shall not purchase or otherwise acquire for a consideration (or permit any
subsidiary to purchase or otherwise acquire for a consideration) any shares
of the Preferred Stock unless full dividends shall have been paid or
declared and set apart for payment on the Preferred Stock for all past
quarterly dividend periods.
Shares of Preferred Stock of any particular series may also be subject to
redemption through operation of any sinking fund created therefor, at the
prices and upon the terms and provisions fixed for such sinking fund by the
Board of Directors as herein authorized.
(d) Upon any liquidation, dissolution or winding up of the
corporation, the holders of Preferred Stock of each series shall be
entitled, before any distribution shall be made to the holders of Common
Stock or of any other class of stock junior to the Preferred Stock, to be
paid the full preferential amount or amounts fixed by the Board of
Directors for such series as herein authorized, but the holders of
Preferred Stock shall not be entitled to any further payment. If, upon such
liquidation, dissolution or winding up of the corporation, the net assets
of the corporation shall be insufficient to permit the payment to the
holders of all outstanding shares of Preferred Stock of all series of the
full preferential amounts to which they are respectively entitled, then the
entire net assets of the corporation shall be distributed ratably in
respect of all outstanding shares of Preferred Stock in proportion to the
full preferential amount to which each such share is entitled.
(e) The holders of Preferred Stock shall, except as otherwise provided
by law or by the provisions of this Section, have only such voting rights
as shall be fixed and determined by the Board of Directors pursuant to
clause (a) of this Section 2, provided, however, that if dividends on the
Preferred Stock shall be in arrears in an amount equal to 150% of the
annual dividends thereon, the holders of the Preferred Stock shall have the
special right, voting as a class, to elect two additional directors to the
Board of Directors. Whenever the special voting right of the holders of
Preferred Stock shall have vested, such special right may be exercised at
any annual meeting of shareholders held for the purpose of electing
directors. The special
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<PAGE> 5
right of the holders of Preferred Stock, voting as a class, to elect
two additional directors as provided herein, shall continue until such
times as all dividends accumulated on the Preferred Stock shall have been
paid in full, at which time the right of the holders of Preferred Stock to
exercise such special voting right shall terminate, subject to revesting
in the event of each and every subsequent arrearage in dividends as
described above. The Board of Directors shall have the right to fix a
record date for the determination of the holders of Preferred Stock
entitled to notice of and vote at any annual meeting when, and during the
period, that special voting rights shall have vested. Upon any termination
of the special voting right of the holders of Preferred Stock provided
herein, the term of the two additional directors elected by the holders of
the Preferred Stock, voting as a class, shall terminate at the next
succeeding annual meeting of shareholders held for the purpose of electing
directors.
(f) So long as any Preferred Stock remains outstanding, the
corporation shall not, without the affirmative vote at a meeting (the
notice of which shall state the general character of the matters to be
submitted thereat), or the written consent with or without a meeting, of
the holders of at least 66-2/3% of the then outstanding shares of Preferred
Stock:
i) authorize or create, or increase the authorized amount of, any
additional class of stock ranking prior to the Preferred Stock; or
authorize or create, or increase the authorized amount of, any class
of stock or obligations convertible into or evidencing the right to
purchase any class of stock ranking prior to the Preferred Stock; or
ii) amend, alter or repeal any of the provisions of the Amended
Articles of Incorporation, as the same may at any time be amended by
the Board of Directors as authorized in clause (a) of this Section, or
otherwise, or of the Code of Regulations of the corporation, so as
adversely to affect the rights, preferences or powers of the holders
of Preferred Stock; provided, however, that if any such amendment,
alteration or repeal would adversely affect the rights, preferences or
powers of outstanding shares of Preferred Stock of any particular
series without correspondingly affecting the rights, preferences or
powers of the outstanding shares of all series, then like vote or
consent by the holders of at least 66-2/3% of the Preferred Stock of
that particular series at the time outstanding shall also be necessary
for effecting or validating any such amendment, alteration or repeal;
or
iii) merge or consolidate with or into any other corporation or
corporations, unless the corporation resulting from such merger or
consolidation will have after such merger or consolidation no class of
stock either authorized or outstanding ranking prior to the Preferred
Stock except the same number of shares of stock with the same rights,
preferences and powers as the stock of the corporation authorized and
outstanding immediately preceding such merger or consolidation, and
unless each holder of Preferred Stock immediately preceding such
merger or consolidation shall receive the same number of shares, with
the same rights, preferences and powers, of such resulting
corporation; provided, however, that no vote of the holders of
outstanding shares of Preferred Stock shall be required for the merger
or consolidation of the corporation on a basis which provides for the
payment, or deposit with a bank or trust company (which shall meet the
requirements specified for a "depository" in clause (c) of this
Section) of funds sufficient for the payment (not later than the
effective date of such merger or consolidation) to the holders of such
outstanding Preferred Stock of an amount equal to the amount which
would have been payable to the holders of such shares if there had
been a liquidation, dissolution or winding up of the corporation as of
said date.
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<PAGE> 6
(g) So long as any Preferred Stock remains outstanding, the
corporation shall not, without the affirmative vote at a meeting
(the notice of which shall state the general character of the matters
to be submitted thereat), or the written consent with or without a meeting,
of the holders of at least a majority of the then outstanding shares of
Preferred Stock:
i) increase the authorized amount of Preferred Stock; or
authorize or create, or increase the authorized amount of, any
additional class of stock ranking on a parity with the Preferred
Stock; or authorize or create, or increase the authorized amount of,
any class of stock or obligations convertible into or evidencing the
right to purchase any class of stock ranking on a parity with the
Preferred Stock; or
ii) sell, lease or convey (which terms shall not be deemed to
include mortgage) all or substantially all, of its property or
business; or voluntarily liquidate, dissolve or wind up its business;
provided, however, that no vote of the holders of outstanding shares
of Preferred Stock shall be required for the sale, lease or conveyance
of all, or substantially all, of the property or business of the
corporation on a basis which provides for the payment, or deposit with
a bank or trust company (which shall meet the requirements specified
for a "depository" in clause (c) of this Section) of funds sufficient
for the payment (not later than the effective date of such sale, lease
or conveyance) to the holders of such outstanding Preferred Stock of
an amount equal to the amount which would have been payable to the
holders of such shares if there had been a liquidation, dissolution or
winding up of the corporation as of said date.
(h) All shares of Preferred Stock redeemed at the option of the
corporation or pursuant to any sinking fund, or purchased and surrendered
to any sinking fund, or converted into Common Stock or other securities,
shall be permanently retired in the manner provided by law and shall not be
reissued.
(i) The holders of Preferred Stock shall have no preemptive rights,
and no holders of Preferred Stock shall be entitled as a matter of right to
subscribe for or purchase shares of any class now or hereafter authorized,
or to subscribe for or purchase securities convertible into or exchangeable
for shares of any class or to which shall be attached or appertain any
warrants or rights entitling the holder thereof to subscribe for or
purchase shares of any class, except such rights of subscription or
purchase, if any, at such price or prices and upon such terms and
conditions as the Board of Directors in its discretion may from time to
time determine.
(j) Subject to limitations imposed in these Amended Articles of
Incorporation, the corporation may purchase, redeem and sell shares of its
Preferred Stock from time to time to such extent, in such manner, and upon
such terms as its Board of Directors may determine; provided, however, that
the corporation shall not use any of its funds for any such purchase or
redemption when there is reasonable ground to believe that the corporation
is or by such purchase or redemption would be rendered insolvent.
(k) The term "accrued dividends" or "dividends accrued", wherever used
with reference to the Preferred Stock or any series thereof, in the Amended
Articles of Incorporation, shall be deemed to mean an amount which shall be
equal to dividends thereon at the rate per annum fixed by the Board of
Directors as hereinbefore authorized for the particular series, computed
from the date on which such dividends began to accrue on such shares to the
date to which dividends are stated to accrue, less the aggregate amount of
dividends theretofore paid thereon.
(l) Any reference in the Amended Articles of Incorporation to a class
of stock ranking prior to or on a parity with the Preferred Stock shall be
deemed to refer to such classes of stock, respectively, ranking prior to or
on a parity with the Preferred Stock in respect of dividends or
distribution of assets on liquidation.
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SECTION 3. ADDITIONAL TERMS AND PROVISIONS OF SERIES C PREFERRED STOCK.
In addition to the express terms set forth in Section 2 of this Article Fourth
which are applicable to all series of Preferred Stock, additional express terms
of the Series C Preferred Stock are as follows:
(a) The designation of such series shall be Series C Cumulative
Preferred Stock ("Series C Preferred Stock") and such series shall
consist of 200,000 shares. Such number of shares may be increased or
decreased by resolution of the Board of Directors; provided, that no
decrease shall reduce the number of shares of Series C Preferred Stock to
a number less than the number of shares then outstanding plus the number
of shares reserved for issuance upon the exercise of outstanding options,
rights or warrants or upon the conversion of any outstanding securities
issued by the corporation convertible into Series C Preferred Stock.
(b) The holders of shares of Series C Preferred Stock shall be
entitled to receive, as and when declared by the Board of Directors, out of
funds legally available for the payment thereof, quarterly dividends
payable in cash on the 1st day of February, May, August and November in
each year (each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend Payment Date
after the first issuance of a share or fraction of a share of Series C
Preferred Stock, in an amount per share (rounded to the nearest cent) equal
to the greater of (a) Ten Dollars ($10.00) or (b) subject to the provision
for adjustment hereinafter set forth, 100 times the aggregate per share
amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions, other
than a dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of a share
of Series C Preferred Stock. In the event the corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the amount
to which holders of shares of Series C Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(c) The corporation shall declare a dividend or distribution on the
Series C Preferred Stock as provided in paragraph (b) of this Section
immediately after it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common Stock); provided
that, in the event no dividend or distribution shall have been declared on
the Common Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a dividend of
Ten Dollars ($10.00) per share on the Series C Preferred Stock shall
nevertheless be accrued and payable on such subsequent Quarterly Dividend
Payment Date.
(d) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series C Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares, unless the date of issue
of such shares is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall begin to accrue
from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series C Preferred Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment
Date, in either of which
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<PAGE> 8
events such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not
bear interest. Dividends paid on the shares of Series C Preferred Stock in
an amount less than the total amount of such dividends at the time accrued
and payable on such shares shall be allocated pro rata on a share-by-share
basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares
of Series C Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not more than 60
days prior to the date fixed for the payment thereof.
(e) Whenever quarterly dividends or other dividends or distributions
payable on the Series C Preferred Stock as provided in Section 3(b)
of this Article Fourth are in arrears, thereafter and until all accrued
and unpaid dividends and distributions, whether or not declared, on shares
of Series C Preferred Stock outstanding shall have been paid in full, the
corporation shall not:
(i) declare or pay dividends, or make any other distributions, on
any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series C Preferred
Stock;
(ii) declare or pay dividends, or make any other distributions,
on any shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series C
Preferred Stock, except dividends paid ratably on the Series C
Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series C Preferred
Stock, provided that the corporation may at any time redeem, purchase
or otherwise acquire shares of any such junior stock in exchange for
shares of any stock of the corporation ranking junior (either as to
dividends or upon dissolution, liquidation or winding up) to the
Series C Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration
any shares of Series C Preferred Stock, or any shares of stock ranking
on a parity with the Series C Preferred Stock, except in accordance
with a purchase offer made in writing or by publication (as determined
by the Board of Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series or
classes.
(f) The corporation shall not permit any subsidiary of the corporation
to purchase or otherwise acquire for consideration any shares of Series C
Preferred Stock, or any shares of stock ranking on a parity with the Series
C Preferred Stock, unless the corporation could, under Section 3(e) of this
Article Fourth purchase or otherwise acquire such shares at such time and
in such manner.
(g) Any shares of Series C Preferred Stock purchased or otherwise
acquired by the corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. Except as contemplated
herein in this Article Fourth, all such shares shall upon their
cancellation become authorized but unissued shares of Preferred Stock and
may be reissued as part of a new series of Preferred Stock subject to the
conditions and restrictions on issuance set forth herein or as otherwise
required by law.
(h) Upon any liquidation, dissolution or winding up of the
corporation, no distribution shall be made (1) to the holders of shares of
stock ranking junior (either as to
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dividends or upon liquidation, dissolution or winding up) to the Series
C Preferred Stock unless, prior thereto, the holders of shares of Series C
Preferred Stock shall have received One Hundred Dollars ($100.00) per
share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such
payment, provided that the holders of shares of Series C Preferred Stock
shall be entitled to receive an aggregate amount per share, subject to the
provision for adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of shares of
Common Stock or (2) to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding up)
with the Series C Preferred Stock, except distributions made ratably on
the Series C Preferred Stock and all such parity stock in proportion to
the total amounts to which the holders of all such shares are entitled
upon such liquidation, dissolution or winding up. In the event the
corporation shall at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the aggregate amount to which holders of shares of
Series C Preferred Stock were entitled immediately prior to such event
under the proviso in clause (1) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction, the numerator of which
is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
(i) In case the corporation shall enter into any consolidation,
merger, combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or securities, cash
and/or any other property, then in any such case each share of Series C
Preferred Stock shall at the same time be similarly exchanged or changed
into an amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 100 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case
may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the corporation shall at any time declare or pay
any dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment of
a dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the amount set forth in the
preceding sentence with respect to the exchange or change of shares of
Series C Preferred Stock shall be adjusted by multiplying such amount by a
fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately
prior to such event.
(j) The shares of Series C Preferred Stock shall not be redeemable.
(k) The Series C Preferred Stock shall rank, with respect to the
payment of dividends and the distribution of assets, pari passu to all
series of any other class of the corporation's Preferred Stock.
SECTION 4. TERMS AND PROVISIONS OF COMMON STOCK.
(a) The rights and preferences of the Common Stock shall be subject in all
respects to the rights and preferences of the Preferred Stock, in the manner and
to the extent provided in Sections 2 and 3 of this Article Fourth.
(b) The Common Stock shall rank junior to the Preferred Stock with respect
to the payment of dividends. When and as declared by the Board of Directors out
of the funds of the
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corporation legally available therefor, after there shall have been paid or
declared or set apart for payment full dividends on all the Preferred Stock and
subject to the restrictions or limitations contained in the express terms and
provisions of the Preferred Stock with respect to the payment of dividends, the
holders of Common Stock shall be entitled to receive dividends.
(c) Each holder of record of Common Stock shall be entitled to one vote for
each share standing in his or her name on the books of the corporation. The
Board of Directors shall have the right to fix a record date of the
determination of the holders of Common Stock entitled to notice of and to vote
at any meeting.
(d) The Common Stock shall rank junior to the Preferred Stock with respect
to payment upon the dissolution, liquidation or sale of assets of the
corporation. Upon the dissolution, liquidation or winding up of the corporation,
after there shall be paid or set apart for holders of Preferred Stock the full
preferential amounts to which they are entitled, the holders of Common Stock
shall be entitled to receive pro rata all of the remaining assets of the
corporation available for distribution to its shareholders.
(e) The holders of Common Stock shall have no preemptive rights, and no
holder of Common Stock shall be entitled as a matter of right to subscribe for
or purchase shares of a class now or hereafter authorized, or to subscribe for
or purchase any securities convertible into or exchangeable for shares of any
class or to which shall be attached or appertain any warrants or rights
entitling the holder thereof to subscribe for or purchase shares of any class.
(f) The corporation may purchase, hold, sell, and reissue any of its
shares of Common Stock and to the extent that the authority to do the same may
be granted under these Amended Articles, the Board of Directors shall have the
power to do all said acts, without any action by shareholders.
FIFTH: SECTION 1. The affirmative vote or consent of the holders of eighty
percent (80%) of all shares of stock of the corporation entitled to vote in the
general elections of directors, considered for the purposes of this Article
Fifth as one class, shall be required for the adoption or authorization of a
business combination, as hereinafter defined, with any other entity, as
hereinafter defined, if, as of the record date for the determination of holders
of shares entitled to notice thereof and to vote thereon or consent thereto,
such other entity is the beneficial owner, directly or indirectly, of more than
ten percent (10%) of the outstanding shares of stock of the corporation entitled
to vote in the general elections of directors, considered for the purposes of
this Article Fifth as one class. The voting requirement specified above shall
not be applicable if the definitive agreement or other arrangements to
effectuate the business combination with the other entity that is a party
thereto is approved by a majority of the directors of the corporation at a time
when such other entity does not beneficially own, directly or indirectly, such a
ten percent (10%) voting interest. In addition, the voting requirements
specified above shall not be applicable if all of the following conditions are
satisfied:
(a) The cash, or fair market value of other consideration, to be
received per share by holders of Common Stock of the corporation in such
business combination bears the same or a greater percentage relationship to
the market price of the corporation's Common Stock immediately prior to the
announcement of such business combination as the highest per share price
(including brokerage commissions and soliciting dealers' fees) which such
other entity has theretofore paid for any of the shares of the
corporation's Common Stock already owned by it bears to the market price of
the Common Stock of the corporation immediately prior to the commencement
of acquisition of the corporation's Common Stock by such other entity; and
(b) The cash, or fair market value of other consideration, to be
received per share by holders of the Common Stock of the corporation in
such business combination (i) is not less than the highest per share price
(including brokerage commissions and soliciting dealers' fees) paid by such
other entity in acquiring any of its holdings of the corporation's Common
Stock, and (ii) is not less than the earnings per share of Common Stock of
the corporation for the four full consecutive
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fiscal quarters immediately preceding the record date for solicitation
of votes on such business combination, multiplied by the then
price/earnings multiple (if any) of such other entity as customarily
computed and reported in the financial community; and
(c) After such other entity has acquired ten percent (10%) of the
shares of stock of the corporation entitled to vote in the general election
of directors and prior to the consummation of such business combination:
(i) such other entity shall not have acquired any newly issued shares of
stock, directly or indirectly, from the corporation (except upon conversion
of convertible securities acquired by it prior to obtaining ten percent
(10%) of the shares of the corporation entitled to vote in the general
election of directors or as a result of a pro rata stock dividend or stock
split); and (ii) such other entity shall not have acquired any additional
shares of the corporation's outstanding Common Stock or securities
convertible into Common Stock except as a part of the transaction which
results in such other entity acquiring its ten percent (10%) or greater
interest; and
(d) Such other entity shall not have (i) received the benefit,
directly or indirectly (except proportionately as a shareholder), of any
loans, advances, guarantees, pledges or other financial assistance or tax
credits provided by the corporation, or (ii) made any major change in the
corporation's business or equity capital structure prior to the
consummation of such business combination.
The provisions of this Article Fifth shall also apply to a business
combination with any other entity which at any time has been the beneficial
owner, directly or indirectly, of more than ten percent (10%) of the
outstanding shares of stock of the corporation entitled to vote in the
general elections of directors considered for the purposes of this Article
Fifth as one class, notwithstanding the fact that such other entity has
reduced its shareholdings below ten percent (10%) if at the time the
definitive agreement was entered into it was the direct or indirect
beneficial owner of such a ten percent (10%) interest or if, as of the
record date for the determination of shareholders entitled to notice of and
to vote on or consent to the business combination, such other entity is an
"affiliate" of the corporation, as hereinafter defined.
SECTION 2. As used in this Article Fifth, (a) the term "other entity"
shall include any corporation, person or other entity and any other entity with
which it or its "affiliate" or "associate", as defined below, has any agreement,
arrangement or understanding, directly or indirectly, for the purpose of
acquiring, holding, voting or disposing of shares of stock of the corporation,
or which is its "affiliate" or "associate" as those terms are defined in Rule
12b-2 of the General Rules and Regulations under the Securities Exchange Act of
1934; (b) an other entity shall be deemed to be the "beneficial owner" of any
shares of stock of the corporation which the other entity, as defined above, has
the right to acquire pursuant to any agreement, or upon exercise of conversion
rights, warrants or options, or otherwise in addition to shares otherwise
beneficially owned; (c) the term "outstanding shares of any class of stock of
the corporation" shall include shares deemed owned through application of clause
(b) above but shall not include any other shares which may be issuable pursuant
to any agreement, or upon exercise of conversion rights, warrants or options, or
otherwise; (d) the term "business combination" shall include any merger or
consolidation of the corporation with or into any other corporation, or the sale
or lease of all or substantially all of the assets of the corporation to, or any
sale or lease to the corporation or any subsidiary thereof in exchange for
securities of the corporation of any assets (except assets having an aggregate
fair market value of less than $5,000,000) of any other entity, or any
reclassification or recapitalization of the outstanding shares of any class of
stock of the corporation if at the time there is any other entity which has
acquired ten percent (10%) of the stock of the corporation entitled to vote in
the election of directors and the effect of such transaction is to increase the
relative voting power of such other entity; and (e) for the purposes of
subparagraphs (a) and (b) of Section 1 of this Article Fifth the term "other
consideration to be received" shall mean, in the event of a business combination
with such
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other entity in which the corporation is the surviving corporation, Common
Stock of the corporation retained by its existing public shareholders.
SECTION 3. A majority of the directors shall have the power and duty,
consistent with their fiduciary obligations, to determine for the purposes of
this Article Fifth on the basis of information known to them whether (a) such
other entity beneficially owns more than ten percent (10%) of the outstanding
shares of stock of the corporation entitled to vote in the general elections of
directors, (b) an other entity is an "affiliate" or "associate" of another, (c)
an other entity has an agreement, arrangement or understanding with another, or
(d) the assets being acquired by the corporation, or any subsidiary thereof,
have an aggregate fair market value of less than $5,000,000.
SECTION 4. No amendment to the Amended Articles of Incorporation of the
corporation shall amend, alter, change or repeal any of the provisions of this
Article Fifth, unless the amendment affecting such amendment, alteration, change
or repeal shall receive the affirmative vote or consent of the holders of eighty
percent (80%) of all shares of stock of the corporation entitled to vote in the
general elections of directors, considered for the purposes of this Article
Fifth as one class. Notwithstanding the foregoing, this Section 4 shall not
apply to, and such requirements of vote or consent shall not be required for,
any amendment, alteration, change or repeal recommended to the shareholders by
the Board of Directors of the corporation if, as of the record date for the
determination of shareholders entitled to notice thereof and to vote thereon or
consent thereto, no other entity is the beneficial owner, directly or
indirectly, of more than ten percent (10%) of the outstanding shares of the
stock of the corporation entitled to vote in the general elections of directors,
considered for the purpose of this provision as one class.
SIXTH: These Amended Articles of Incorporation supersede and take the place of
the existing Amended Articles of Incorporation dated February 15,
1993, as amended.
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<PAGE> 1
Exhibit 3(ii)
CODE OF REGULATIONS
OF
HUFFY CORPORATION
INDEX
<TABLE>
<S> <C> <C>
ARTICLE I SHAREHOLDERS
Section A. Annual Meeting
B. Special Meetings
C. Notice of Meetings
D. Proxies
E. Quorum -- Adjournment
F. Financial Statements
G. Notice of Shareholder Nominees
H. Approval and Ratification of Acts of Officers and Board of Directors
I. Certificates for Shares of Stock
ARTICLE II BOARD OF DIRECTORS
Section A. Powers of the Board
B. Number of Directors
C. Term of Office, Removal and Vacancies
D. Meetings of the Board
E. Action Without a Meeting
F. Committees
G. Compensation
H. Fiscal Year
I. Retirement
ARTICLE III OFFICERS
Section A. Designation, Election and Term of Office
B. Chairman of the Board
C. President
D. Vice Presidents
E. Secretary
F. Treasurer
G. Other Officers
H. Compensation -- Officers and Employees
ARTICLE IV MISCELLANEOUS
Section A. Seal
B. Indemnification of Directors and Officers
C. Amendments
</TABLE>
1
<PAGE> 2
CODE OF REGULATIONS
OF
HUFFY CORPORATION
ARTICLE I -- SHAREHOLDERS
SECTION A. ANNUAL MEETING
1. The annual meeting of the shareholders of the Corporation for the
election of directors and the transaction of such other business as may be
specified in the notice shall be held within 120 days following the close of the
Corporation's Fiscal Year.
2. The date, hour, place and city, either within or without the State of
Ohio, will be designated by the Board of Directors and will be set forth in the
notice of the meeting.
3. Either the Chairman, Vice Chairman or President shall preside at all
meetings of the shareholders, depending on individual availability in that
order.
SECTION B. SPECIAL MEETINGS
1. Special meetings of the shareholders may be called by:
a. The Chairman of the Board, or
b. The President, or
c. The Vice President authorized to exercise the authority of the
President, in case of the latter's absence, death, or disability, or
d. The Board of Directors acting at a meeting, or
e. Not less than 50% of the Directors acting without a meeting, or
f. The shareholders holding of record 50% or more of all the shares
outstanding and entitled to vote thereat.
2. Any such request for a special meeting of shareholders shall state the
purpose or purposes of the meeting.
3. Upon request in writing delivered either in person or by registered mail
to the President or the Secretary by any person or persons entitled to call a
meeting of shareholders, such officer shall forthwith cause to be given to the
shareholders entitled thereto notice of a meeting to be held on a date not more
than sixty days nor less than ten days after the receipt of such request, as
such officer may fix.
4. Special meetings of the shareholders may be held at such time and place,
either within or without the State of Ohio, as may be designated in the notice
thereof.
SECTION C. NOTICE OF MEETINGS
1. Unless waived as provided by law, a written or printed notice of each
annual or special meeting stating the time and place and the purpose or purposes
thereof shall be directed to each shareholder of record entitled to vote
thereat.
2. Such notice shall be given by personal delivery or shall be mailed
postage prepaid not more than sixty days nor less than ten days before any
meeting. It shall be addressed to the shareholder at his or her address as it
appears upon the records of the Corporation.
3. Notice of adjournment of a meeting need not be given if the time and
place to which it is adjourned are fixed and announced at such meeting.
SECTION D. PROXIES
1. Persons entitled to vote, share or to act with respect to shares at a
meeting of shareholders may be represented and vote or act thereat by proxy
appointed through an instrument in writing and submitted to the Secretary at or
before any shareholders' meeting.
2. The person appointed as proxy need not be a shareholder.
3. Notice to the Corporation, in writing or in open meeting, by the person
having appointed a proxy, of the revocation of the appointment of a proxy shall
not affect any vote or act previously taken or authorized at a meeting.
SECTION E. QUORUM -- ADJOURNMENT
1. The holders of record of shares entitled to exercise not less than fifty
percent (50%) of
2
<PAGE> 3
the voting power of the Corporation present in person or by proxy at any meeting
of shareholders shall constitute a quorum.
2. The holders of a majority of the voting shares present in person or by
proxy at any meeting of shareholders, whether or not a quorum is present, may
adjourn such meeting from time to time.
SECTION F. FINANCIAL REPORTS
1. The financial statement shall be presented at annual shareholders'
meetings or to individual shareholders, as required by law.
2. The financial statement shall have appended thereto a certificate, as
required by law.
SECTION G. NOTICE OF SHAREHOLDER NOMINEES
1. Nominations of persons for election to the Board of Directors of the
Corporation may be made at a meeting of shareholders by or at the direction of
the Board of Directors or by any shareholder of the Corporation entitled to vote
for the election of Directors at the meeting who complies with the notice
procedures set forth in this Section. Such nominations, other than those made by
or at the direction of the Board of Directors, shall be made pursuant to timely
notice in writing to the Secretary of the Corporation. To be timely, a
shareholder's notice shall be delivered to or mailed and received at the
principal executive offices of the Corporation not less than fifty (50) days nor
more than ninety (90) days prior to the meeting; provided, however, that in the
event that less than sixty (60) days' notice or prior public disclosure of the
date of the meeting is given or made to shareholders, notice by the shareholder
to be timely must be so received not later than the close of business on the
tenth (10th) day following the day on which such notice of the date of the
meeting was mailed or such public disclosure was made. Such shareholder's notice
shall set forth (a) as to each person whom the shareholder proposes to nominate
for election or re-election as a Director, (i) the name, age, business address
and residence address of such person, (ii) the principal occupation or
employment of such person, (iii) the class and number of shares of the
Corporation which are beneficially owned by such person and (iv) any other
information relating to such person that is required to be disclosed in
solicitations of proxies for election of Directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities Exchange Act of 1934,
as amended (including without limitation such person's written consent to
serving as a Director if elected); and (b) as to the shareholder giving notice
(i) the name and address, as they appear on the Corporation's books, of such
shareholder and (ii) the class and number of shares of the Corporation which
are beneficially owned by such shareholder. 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 of the Corporation that information
required to be set forth in a shareholder's notice of nomination which
pertains to the nominee. No person shall be eligible for election as a
Director of the Corporation unless nominated in accordance with the procedures
set forth in this Section. The Chairman of the meeting shall, if the facts
warrant, determine and declare to the meeting that a nomination was not made
in accordance with the procedures prescribed in this Section, and if he or she
should so determine, he or she shall so declare to the meeting and the
defective nomination shall be disregarded.
SECTION H. APPROVAL AND RATIFICATION OF ACTS OF BOARD OF DIRECTORS AND OF
OFFICERS
1. Except as otherwise provided by law, any contract, act, or transaction,
prospective or past, of the Corporation, or of the Board of Directors, or of the
Officers may be approved or ratified by the affirmative vote at a meeting of the
shareholders, or by the written consent, with or without a meeting, of the
holders of record of shares entitling them to exercise a majority of the voting
power of the Corporation, and such approval or ratification shall be as valid
and binding as though affirmatively voted for or consented to by every
shareholder of the Corporation.
3
<PAGE> 4
SECTION I. CERTIFICATES FOR SHARES OF STOCK
1. The interest of each shareholder of the Corporation shall be evidenced
by a certificate or certificates for shares in such form as the Board of
Directors may from time to time prescribe.
2. Each certificate shall bear:
a. A distinguishing number, and
b. The signature of the President and Secretary, and
c. The seal of the Corporation, and
d. Such recitals as may be required by law.
3. The certificates shall be issued in numerical order and a record kept
for that purpose as required by law.
4. Shares of the Corporation shall be transferable on the books of the
Corporation by the holder thereof in person or by his or her attorney, upon
surrender for cancellation of a certificate or certificates for the same number
of shares, with an assignment and power of transfer endorsed thereon or attached
thereto, duly executed, and with such proof of the authenticity of the signature
as the Corporation or its agent may reasonably require.
5. The Corporation may issue a new certificate for shares in place of any
certificate theretofore issued by it and alleged to have been lost, stolen, or
destroyed, and the Board of Directors may, in its discretion require the owner,
or his or her legal representatives, to give the Corporation a bond containing
such terms as the Board of Directors may require to protect the Corporation or
any person injured by the execution and delivery of a new certificate.
6. Upon the taking of a record date of shareholders for the purposes of
declaring dividends, for the purposes of determining those shareholders entitled
to vote at any meeting or for any other purposes, the stock transfer books of
the Corporation shall not be closed, but shall remain open for the purposes of
recording the issuing, transfer or other transactions in connection with the
stock of the Corporation.
ARTICLE II -- BOARD OF DIRECTORS
SECTION A. POWERS OF THE BOARD
1. Except as otherwise provided by law, all the capacity of the Corporation
shall be vested in and all its authority shall be exercised by the Board of
Directors.
SECTION B. NUMBER OF DIRECTORS
1. There shall be such number of Directors, not less than nine nor more
than fourteen as may be fixed or changed from time to time (a) by
the shareholders at a meeting called for such purpose at which a quorum is
present, by the affirmative votes of the holders of a majority of the shares
which are present, in person or by proxy, at the meeting and entitled to vote
on such proposal or (b) by the Directors at a meeting at which a quorum is
present, by the affirmative vote of a majority of the Directors which are
present at the meeting, or by action taken without a meeting in a writing or
writings signed by all of the Directors. No reduction in the number of
Directors shall of itself have the effect of shortening the term of any
incumbent Director.
SECTION C. TERM OF OFFICE, REMOVAL AND VACANCIES
1. A Director's term of office shall be three (3) years, except that, in
order to provide for rotation of members, initially or whenever necessary a
Director may be elected for a shorter term. The Board of Directors shall be
divided into three classes of not less than three Directors each, with the term
of office of one class expiring each year. A Director shall hold office until
the annual shareholders' meeting next succeeding the termination of the term for
which he or she was elected and until his or her successor is elected and
qualified.
2. A vacancy or vacancies (including without limitation any vacancy or
vacancies created by action of the Directors increasing the number of Directors)
may be filled by a majority vote of the remaining Directors for that period of
time to the next shareholders' meeting at which meeting the shareholders will
elect a Director to fill the unexpired portion of any term of office.
4
<PAGE> 5
SECTION D. MEETINGS OF THE BOARD
1. The regular meetings of the Board of Directors shall be held immediately
after the annual meeting of the shareholders and at such other times as may be
fixed by the Board of Directors, and such meetings may be held without further
notice.
2. Special meetings of the Board of Directors may be held at any time upon
call of:
a. The Chairman of the Board, or
b. The President, or
c. The Vice-President authorized to exercise the authority of the
President in case of latter's absence, death or disability, or
d. Two of the duly elected or appointed and qualified Directors.
Notice of the time and place of special meetings shall be served upon or
telephoned to each Director at least twenty-four hours, or mailed or
faxed to each Director at his or her address as shown by the
books of the Corporation at least forty-eight hours, prior to the time of the
meeting, which notice need not specify the purposes of the meeting. Such
notice may be waived as provided by law.
3. Meetings of the Board of Directors, whether regular or special, may be
held at any place either within or without the State of Ohio.
4. Not less than 50% of the duly elected or appointed and qualified
Directors of the Corporation shall constitute a quorum for the transaction of
business. The act of a majority of Directors present at a meeting, at which a
quorum is present shall be the act of Directors.
5. The majority of the Directors present at any meeting, whether or not a
quorum is present, may adjourn the meeting from time to time without notice
other than announcement at the meeting, until a quorum shall attend.
SECTION E. ACTION WITHOUT A MEETING
1. Any action which may be authorized or taken at a meeting of the Board of
Directors may be authorized or taken without a meeting in a writing or writings
signed by all of the Directors, which writing or writings shall be filed with or
entered upon the records of the Corporation.
SECTION F. COMMITTEES
1. The Board of Directors may from time to time appoint three or more
Directors to constitute an Executive Committee and one or more other
committees of Directors. The resolution establishing each such committee shall
specify a designation by which it shall be known and shall fix its powers
and authority. The Board of Directors may delegate to any such committee any of
the authority of the Board of Directors, however, conferred, other than that of
filling vacancies among the Directors or in any committee of the Directors.
2. The Board of Directors may likewise appoint one or more Directors as
alternate members of any such committee, who may take the place of any absent
member or members at any meeting of such committee.
3. Each such committee shall serve at the pleasure of the Board of
Directors, shall act only at the intervals between meetings of the Board of
Directors, and shall be subject to the control and direction of the Board of
Directors.
4. An act or authorization of an act by any such committee within the
authority delegated to it by the resolution establishing it shall be effective
for all purposes as the act or authorization of the Board of Directors.
5. In every case the affirmative vote of a majority in meeting or the
consent in writing of all the members of any such committee shall be necessary
for the approval of any action.
6. Each committee shall keep written records of all meetings and actions.
SECTION G. COMPENSATION
1. The Board of Directors is empowered to fix the amount of and authorize
the payment of compensation to the Directors and of the Executive Committee and
other committees for services rendered to the Corporation and of reimbursement
for traveling expenses incurred in attending meetings.
5
<PAGE> 6
SECTION H. FISCAL YEAR
1. The fiscal year of the Corporation shall end on the last day of
December in each year, or on such other day as may be fixed from time to time
by the Board of Directors.
SECTION I. RETIREMENT OF DIRECTORS
1. Non-Employee Directors
a. A non-employee Director who reaches the age of seventy (70) years
during his or her term of office as a Director, shall retire from the
board, effective the next quarterly Directors' meeting following the date
on which he or she attained the age of seventy (70) years. Thereafter
such Director shall, during his or her lifetime, have the title of
Director Emeritus.
2. Employee Directors
a. A Director, other than the President or Chairman of the Board, who
is an employee of the Corporation shall retire as a Director as of the date
he or she terminates his or her active employment with the Corporation
and shall thereafter, during his or her lifetime, have the title of
Director Emeritus.
b. A Director who has served the Corporation as President and/or
Chairman of the Board at the time of his or her retirement from active
employment shall not be nominated for a term of office as Director, the
election for which would be held after he or she has attained the age of
seventy (70). A Director who is not re-nominated for office by virtue of
this covenant shall thereafter, during his or her lifetime, have the
title of Director Emeritus.
3. If the Board of Directors shall be confronted with an unusual situation
that to it seems to require relaxation of any of the foregoing rules, the Board
of Directors shall have power, by resolution, to establish or re-establish the
retirement age, or otherwise waive the age limitation of any Director or former
Director, so as to qualify him or her to serve longer, or again, as a
Director.
ARTICLE III -- OFFICERS
SECTION A. DESIGNATION, ELECTION AND TERM OF OFFICE
1. The Corporation may have a Chairman of the Board, and shall have a
President, one or more Vice Presidents, a Secretary, a Treasurer, and such other
officers as the Board of Directors may from time to time determine.
2. The Chairman of the Board and the President shall be Directors, but no
one of the other officers need be a Director.
3. Any two or more offices may be held by one person. However, no officer
shall execute, acknowledge, or verify any instrument in more than one capacity
if such instrument is required by law or by these regulations to be executed,
acknowledged, or verified by two or more officers.
4. If there be more than one Vice President, the Board of Directors may
designate their seniority through the method it selects and/or the particular
department or function of the Corporation over which they shall have charge.
5. All officers of the Corporation shall be elected by the Board of
Directors.
6. Each officer shall hold office until his or her successor is chosen
and qualified, unless otherwise specified by the Board of Directors.
7. The Board of Directors may fill any vacancy in any office occurring from
whatever reason.
SECTION B. CHAIRMAN OF THE BOARD
1. The Chairman of the Board shall preside at all meetings of the Board of
Directors and shall have such other authority and duties as may be delegated by
the Board of Directors.
SECTION C. PRESIDENT
1. The President shall preside at all meetings of Board of Directors,
except for meetings of the Board of Directors at which the Chairman of the Board
presides in accordance with the preceding Section.
2. Subject to the direction of the Board of Directors, the President shall
have the general
6
<PAGE> 7
executive supervision over the property, business, and affairs of the
Corporation.
3. The President shall have such other duties and powers as may be assigned
to or invested in him or her by the Board of Directors.
SECTION D. VICE PRESIDENTS
1. The Vice Presidents, in the order of their seniority by designation
shall perform the duties of the President in his or her absence or during his
or her disability to act. The Vice Presidents shall have such other duties and
powers as may be assigned to or invested in them by the Board of Directors or by
the President.
SECTION E. SECRETARY
1. The Secretary shall issue notices of all meetings for which notices
require to be given, shall keep the minutes of the meetings, shall have charge
of the corporate seal and corporate record books and shall have other duties and
powers as may be assigned to or invested in him or her by the Board of
Directors or by the President.
SECTION F. TREASURER
1. The Treasurer shall have charge of all moneys and securities of the
Corporation.
2. The Treasurer shall cause to be kept adequate and correct
account of the Corporation's business transactions and shall have general
charge and supervision of financial reports.
3. The Treasurer shall have such other duties and powers as may be assigned
to or invested in him or her by the Board of Directors or by the President.
SECTION G. OTHER OFFICERS
1. Other officers of the Corporation shall have such duties and powers as
may be assigned to or invested in them by the Board of Directors or by the
President.
SECTION H. COMPENSATION -- OFFICERS AND EMPLOYEES
1. The compensation of officers and employees of the Corporation, or the
method of fixing such compensation, shall be determined by or pursuant to
authority conferred by the Board of Directors or any committee of the Board of
Directors.
2. Such compensation may include retirement, disability, and death
benefits, and may be by way of fixed salary, or on the basis of earnings of the
Corporation, or any combination thereof, or otherwise, as may be determined or
authorized from time to time by the Board of Directors or any committee of the
Board of Directors.
ARTICLE IV -- MISCELLANEOUS
SECTION A. SEAL
1. The seal of the Corporation shall be circular with the words "HUFFY
CORPORATION" and "DAYTON, O." surrounding the word "SEAL" .
SECTION B. INDEMNIFICATION OF DIRECTORS AND OFFICERS
1. The Corporation shall, and hereby agrees to, indemnify any person who
served or serves as a director, officer, employee or agent of the Corporation,
or who served or serves at the request of the Corporation as a director,
trustee, officer, employee or agent of another Corporation, domestic or foreign,
non-profit or for profit, partnership, joint venture, trust, or other
enterprise, against any and all losses, liabilities, damages, and expenses,
including attorney's fees, judgments, fines, Employee Retirement Income Security
Act excise taxes or penalties and amounts paid in settlement, incurred by such
person, in connection with any claim, action, suit, or proceeding, including any
action or suit by or in the right of the Corporation (whether threatened,
pending or completed and whether civil, criminal, administrative, or
investigative, including appeals), by reason of any act or omission to act as
such director, trustee, officer, employee or agent, to the full extent permitted
by Ohio law including, without limitation, the provisions of Section 1701.13 of
the Ohio Revised Code, as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that such amendment permits
the Corporation to provide broader indemnification rights than said law
permitted the Corporation to provide prior to such amendment).
Further, unless at the time of a Director's act or omission to act that is the
subject of an action, suit, or proceeding referred to in this Section B of
Article IV, the Articles of Incorporation or the Code of Regulations of this
Corporation state by specific reference to Section
7
<PAGE> 8
1701.13(E)(5)(a) of the Ohio Revised Code that the provisions of Section
1701.13(E)(5)(a) do not apply to the Corporation, and unless the only liability
asserted against a Director in an action, suit or proceeding referred to in this
Section B of Article IV is pursuant to Section 1701.95 of the Ohio Revised Code,
then all expenses, including attorney's fees, incurred by a Director in
defending the action, suit or proceeding shall be paid by the Corporation as
they are incurred, in advance of the final disposition of the action, suit, or
proceeding upon receipt of an undertaking by or on behalf of the Director in
which he or she agrees to do both of the following:
a. Repay such amount if it is proved by clear and convincing evidence
in a court of competent jurisdiction that his or her action or failure to
act involved an act or omission undertaken with deliberate intent to cause
injury to the Corporation or undertaken with reckless disregard for the
best interests of the Corporation;
b. Reasonably cooperate with the Corporation concerning the action,
suit, or proceeding.
The indemnification authorized by this Article IV shall not be exclusive of, and
shall be in addition to, any other rights granted to any person seeking
indemnification under the Articles of Incorporation, this Code of Regulations or
any agreement, vote of shareholders or disinterested Directors, or otherwise,
both as to action in such person's official capacity and as to action in another
capacity while holding such office, and shall continue as to a person who has
ceased to be a director, trustee, officer, employee or agent and shall inure to
the benefit of the heirs, executors, and administrators of such a person.
The Corporation may purchase and maintain insurance, or furnish similar
protection, including but not limited to trust funds, letters of credit or self
insurance, on behalf of or for any person who is or was a director, officer,
employee, or agent of the Corporation, or is or was serving at the request of
the Corporation as a director, trustee, officer, employee, or agent of another
corporation, domestic or foreign, non-profit or for profit, partnership, joint
venture, trust, or other enterprise, against any liability asserted against him
or her and incurred by him or her in any such capacity, or arising out of
his or her status as such, whether or not the Corporation would have the
power to indemnify him or her against such liability under Ohio law. Insurance
may be purchased from or maintained with a person in which the Corporation has a
financial interest.
SECTION C. AMENDMENTS
1. This Code of Regulations may be amended or repealed only by the
affirmative vote of the holders of shares entitling them to exercise two-thirds
of the voting power of the Corporation, at a meeting of the shareholders held
for such purpose, or without a meeting by the unanimous written consent of all
of the shareholders of the Corporation.
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE COMPANY'S
CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
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<S> <C>
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<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> JUN-30-1995
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<SECURITIES> 0
<RECEIVABLES> 126,990
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<INVENTORY> 70,513
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<DEPRECIATION> (113,462)
<TOTAL-ASSETS> 347,947
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<BONDS> 58,567
<COMMON> 16,200
0
0
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