UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the period ended June 30, 1996
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 No. 1-52
[Logo]
SUNBEAM CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 25-1638266
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
INCORPORATION OR ORGANIZATION)
2100 NEW RIVER CENTER
200 EAST LAS OLAS BOULEVARD 33301
FORT LAUDERDALE, FLORIDA (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(954) 767-2100
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
NOT APPLICABLE
(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 [ ]
On July 22, 1996, there were 82,068,351 shares of the registrant's
Common Stock ($.01 par value) outstanding.
<PAGE>
SUNBEAM CORPORATION AND SUBSIDIARIES
QUARTERLY REPORT
ON FORM 10-Q
TABLE OF CONTENTS
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PAGE
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Statements of Operations (Unaudited)
for the three and six months ended July 2, 1995 and June 30, 1996........ 2
Condensed Consolidated Balance Sheets
as of December 31, 1995 and June 30, 1996 (Unaudited).................... 3
Condensed Consolidated Statements of Cash Flows (Unaudited)
for the six months ended July 2, 1995 and June 30, 1996.................. 4
Notes to Condensed Consolidated Financial Statements (Unaudited)........... 5
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations............................................ 7
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders........................ 10
Item 5. Other Information.......................................................... 10
Item 6. Exhibits and Reports on Form 8-K........................................... 11
SIGNATURES..................................................................................... 12
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
SUNBEAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
----------------------- --------------------------
JULY 2, JUNE 30, JULY 2, JUNE 30,
1995 1996 1995 1996
------- -------- ------- --------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net sales................................... $308,770 $345,896 $648,278 $685,809
Cost of goods sold.......................... 248,701 283,185 505,199 550,698
Selling, general and administrative expense 39,560 46,752 70,749 87,222
--------- --------- -------- --------
Operating earnings.......................... 20,509 15,959 72,330 47,889
Interest expense............................ 2,753 3,410 4,934 6,446
Other (income) expense, net................. (1,307) 1,117 (1,673) 2,453
--------- --------- -------- --------
Earnings before income taxes................ 19,063 11,432 69,069 38,990
Income taxes:
Current................................... 7,092 1,650 17,048 9,554
Deferred.................................. 533 2,577 10,578 4,870
--------- --------- -------- --------
7,625 4,227 27,626 14,424
--------- --------- -------- --------
Net earnings................................ $ 11,438 $ 7,205 $ 41,443 $ 24,566
======== ======= ======== ========
Net earnings per share of common
stock...................................... $ .14 $ .09 $ .50 $ .30
======== ======= ======== ========
Average number of common and common
equivalent shares outstanding.............. 83,055 82,449 83,205 82,481
Dividends declared per
share of common stock...................... $ .01 $ .01 $ .02 $ .02
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
2
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SUNBEAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1995 1996
----------- --------
ASSETS (Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents............................................. $ 28,273 $ 35,794
Receivables, net...................................................... 216,195 228,749
Inventories........................................................... 266,706 327,093
Deferred income taxes................................................. 26,333 22,414
Prepaid expenses and other current assets............................. 19,543 7,361
---------- ----------
Total current assets......................................... 557,050 621,411
Property, plant and equipment, net .................................... 331,112 344,763
Trademarks and trade names, net........................................ 214,006 210,935
Other assets........................................................... 56,516 53,201
---------- ----------
$1,158,684 $1,230,310
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current portion of long-term debt........... $ 1,166 $ 1,117
Accounts payable....................................................... 94,191 104,225
Other current liabilities............................................ 93,974 82,193
---------- ----------
Total current liabilities.................................... 189,331 187,535
Long-term debt......................................................... 161,133 216,404
Non-operating and other long-term liabilities.......................... 130,255 122,512
Deferred income taxes.................................................. 76,932 77,882
Shareholders' equity:
Common stock (issued 87,802,667 and 87,952,418 shares)............... 878 880
Other shareholders' equity........................................... 683,604 708,546
Treasury stock, at cost (5,905,600 shares)........................... (83,449) (83,449)
---------- ----------
Total shareholders' equity................................... 601,033 625,977
---------- ----------
$1,158,684 $1,230,310
========== ==========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
3
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SUNBEAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
--------------------------
JULY 2, JUNE 30,
1995 1996
-------- --------
(Unaudited)
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OPERATING ACTIVITIES:
Net earnings.......................................................... $ 41,443 $ 24,566
Adjustments to reconcile net earnings to net cash
provided by (used in) operating activities:
Depreciation and amortization..................................... 20,515 27,237
Deferred income taxes............................................. 10,578 4,870
-------- --------
72,536 56,673
Decrease in cash from changes in working capital....................... (54,520) (61,262)
Other.................................................................. (7,394) (2,636)
-------- --------
Net cash provided by (used in) operating activities............... 10,622 (7,225)
--------- --------
INVESTING ACTIVITIES:
Capital expenditures, net............................................. (75,176) (35,176)
Reduction in investments restricted for plant construction............ 29,696 -
Other................................................................. - 253
-------- --------
Net cash used in investing activities............................ (45,480) (34,923)
-------- --------
FINANCING ACTIVITIES:
Net borrowings under revolving credit facility......................... 45,000 45,000
Issuance of long-term debt............................................ - 6,500
Short-term borrowings................................................. (5,502) (690)
Purchase of shares for treasury....................................... (13,091) -
Proceeds from the exercise of stock options and warrants.............. 7,387 1,138
Other ................................................................ (2,014) (2,279)
-------- --------
Net cash provided by financing activities....................... 31,780 49,669
-------- --------
Net increase (decrease) in cash and cash equivalents.................. (3,078) 7,521
Cash and cash equivalents at beginning of period...................... 26,330 28,273
-------- --------
Cash and cash equivalents at end of period............................ $23,252 $ 35,794
======= ========
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
4
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SUNBEAM CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. OPERATIONS AND BASIS OF PRESENTATION
Sunbeam Corporation (the "Company") is a leading consumer products company
that designs, manufactures and markets a diverse portfolio of outdoor and
household brand name products. The Sunbeam(R) and Oster(R) brands have been
household names for generations, both domestically and abroad, and the Company
is a market share leader in many of its product categories.
The Company markets its products through virtually every category of
retailer including mass merchandisers, catalog showrooms, warehouse clubs,
department stores, hardware stores, home centers, drug and grocery stores, pet
supply retailers, as well as independent distributors and the military.
In the opinion of management, the unaudited condensed consolidated
financial statements furnished herein include all adjustments (consisting only
of normal recurring adjustments) necessary for a fair presentation of the
results of operations for the interim periods presented. These interim results
of operations are not necessarily indicative of results for the entire year. The
condensed consolidated financial statements contained herein should be read in
conjunction with the consolidated financial statements and related notes
contained in the Company's 1995 Annual Report on Form 10-K ("Form 10-K").
2. SUPPLEMENTAL FINANCIAL STATEMENT DATA
(IN THOUSANDS)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1995 1996
--------- ---------
<S> <C> <C>
Inventories:
Finished goods.................................. $155,511 $195,590
Work in process................................. 31,161 55,696
Raw materials and supplies...................... 80,034 75,807
-------- --------
$266,706 $327,093
======== ========
Property, plant and equipment:
Land............................................ $ 3,562 $ 3,337
Buildings and improvements...................... 106,592 114,463
Machinery and equipment......................... 338,667 372,065
-------- -------
448,821 489,865
Accumulated depreciation and amortization....... (117,709) (145,102)
-------- --------
$331,112 $344,763
======== ========
Trademarks and trade names:
Gross........................................... $245,307 $245,307
Accumulated amortization........................ (31,301) (34,372)
-------- --------
$214,006 $210,935
======== ========
</TABLE>
5
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SUNBEAM CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
2. SUPPLEMENTAL FINANCIAL STATEMENT DATA (CONTINUED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
-----------------------------
July 2, June 30,
1995 1996
---------- --------
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Cash paid during the period for:
Interest, net of $1,822 and $212 capitalized in 1995
and 1996, respectively..................................... $ 4,691 $6,185
======= ======
Income taxes, net of refunds.................................. $18,463 $ (656)
======= ======
</TABLE>
Non-Cash Transaction:
In connection with a warehouse expansion related to the bedding
business, the Company entered into a $5 million capital lease
obligation in 1996.
3. CAPITAL STOCK
In July 1996, the Company sold 316,786 shares of common stock for total
proceeds of $4,100,000, granted 333,333 shares of unrestricted stock and granted
886,667 shares of restricted stock in connection with the employment of a new
Chairman and Chief Executive Officer and certain other officers of the Company.
In addition, options to purchase 3,700,000 shares of the Company's common stock,
with exercise prices equal to the fair market value of the stock at the dates of
grant were issued in connection with employment of such officers. Compensation
expense attributable to the unrestricted stock award will be recognized in the
third quarter of 1996 and compensation expense related to the restricted stock
awards will be amortized to expense beginning in the third quarter of 1996 over
the periods in which the restrictions lapse (which in the case of 666,667 shares
is equally over two years from the date of grant and in the case of the
remaining restricted shares is equally over three years from the dates of
grant).
6
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the
accompanying condensed consolidated financial statements for the three and six
months ended July 2, 1995 and June 30, 1996 and the 1995 Form 10-K.
RESULTS OF OPERATIONS
The table below sets forth selected operating data of the Company for the
three and six months ended July 2, 1995 and June 30, 1996:
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
------------------ ----------------
<S> <C> <C> <C> <C>
JULY 2, JUNE 30, JULY 2, JUNE 30,
1995 1996 1995 1996
------ ------ ------ -------
Net sales.......................... 100.0% 100.0% 100.0% 100.0%
Cost of goods sold................. 80.5 81.9 77.9 80.3
------ ------ ------ ------
Gross margin....................... 19.5 18.1 22.1 19.7
Selling, general and administrative
expense........................... 12.8 13.5 10.9 12.7
------ ------ ------ ------
Operating earnings................. 6.7% 4.6% 11.2% 7.0%
====== ====== ====== ======
</TABLE>
NET SALES
Net sales for the three and six months ended June 30, 1996 were $345.9
and $685.8 million, respectively, an increase of $37.1 million (12.0%) and $37.5
million (5.8%) over the comparable periods in the prior year. The Company's
sales growth in 1996 is primarily attributable to sales related to the Samsonite
furniture acquisition completed in November 1995 which accounted for
approximately 4 percentage points of the sales increases for both the three and
six months ended June 30, 1996. In addition, North American household products
sales, primarily in Mexico and from new products, accounted for approximately 5
percentage points of the second quarter 1996 sales growth. Excluding the impact
of the Samsonite acquisition, sales for the Company's outdoor products for the
six months ended June 30, 1996 were essentially flat, reflecting a poor spring
and early summer selling season for seasonal outdoor products for the second
year in a row. For the second quarter of 1996, sales of outdoor products
benefited from increased placements of resin furniture.
The Company's international sales (outside of North America) decreased
9.4% during the quarter and remained flat for the six months ended June 30,
1996. Second quarter 1996 sales in Venezuela suffered as a result of strong
first quarter 1996 consumer purchases of hard goods in anticipation of the
currency devaluation that occurred in April 1996.
GROSS PROFIT
Gross profit was $62.7 million and $135.1 million for the three and six
months ended June 30, 1996, respectively. As a percentage of sales, the gross
margin for the three and six months ended June 30, 1996 was 18.1% and 19.7%,
respectively, compared to 19.5% and 22.1% in 1995, respectively. While the
Company experienced a slight reduction in raw material costs in 1996, gross
margin continues to suffer from underabsorption of higher manufacturing
costs associated with the significant capital spending and capacity additions
that have occurred since 1994 in anticipation of a higher level of sales volume
than the Company is currently experiencing. The Company expects its gross margin
for the remainder of 1996 to continue to be adversely impacted by costs
associated with excess capacity and the failure to realize much of the
previously anticipated cost savings expected from increased utilization of the
Hattiesburg manufacturing and distribution center in 1996.
7
<PAGE>
The Company has initiated an intensive review of its cost structure and
product lines to correct the current imbalance between production capacity,
operating costs and sales. Specific actions to be taken by the Company when such
review is completed later this year have not yet been determined but will likely
include, among other actions, the elimination of low margin and/or unprofitable
products, the closure of additional manufacturing facilities, and the
consolidation of administrative office locations. Such actions will likely
result in the Company recording a special charge later in 1996.
OPERATING EARNINGS
Operating earnings for the three months ended June 30, 1996 were $16.0
million, a decrease of $4.6 million. As a percentage of sales, operating
earnings decreased from 6.7% in 1995 to 4.6% in 1996. This decline was
attributable to a 1.4 percentage point reduction in gross margin described above
as well as a 0.7 percentage point increase in selling, general and
administrative expenses ("SG&A") as a percent of sales, to 13.5%. For the six
months ended June 30, 1996, operating earnings were $47.9 million, a decrease of
$24.4 million. As a percentage of sales, operating earnings decreased from 11.2%
in 1995 to 7.0% in 1996. This decline was attributable to a 2.4 percentage point
reduction in gross margin as well as a 1.8 percentage point increase in SG&A
as a percent of sales, to 12.7%.
The SG&A increases for the three and six months ended June 30, 1996 were
primarily the result of (1) SG&A costs associated with the Samsonite furniture
business, (2) increased marketing, media advertising and sales promotion costs
in support of new product introductions, (3) higher depreciation associated with
new systems and warehousing, (4) higher costs associated with international
expansion and (5) higher distribution and warehousing expenses, primarily
associated with outdoor products.
Refer to Note 3 in the "Notes to Condensed Consolidated Financial
Statements" for a discussion of compensation expense associated with the
issuance of common stock of the Company in July 1996 in connection with the
employment of a new Chairman and Chief Executive Officer and certain other
officers of the Company.
INTEREST EXPENSE
Interest expense for both the three and six months ended June 30, 1996
increased $0.7 million and $1.5 million, respectively, as a result of increased
indebtedness of the Company for working capital requirements and non-recurring
capitalized interest in 1995 related to the construction of the Hattiesburg
facility.
OTHER (INCOME) EXPENSE, NET
Other (income) expense, net changed from income of $1.3 million and $1.7
million for the three and six months ended July 2, 1995, respectively, to
expense of $1.1 million and $2.5 million for the three and six months ended June
30, 1996, respectively. This change was primarily attributable to higher foreign
exchange losses in 1996 associated with the April 1996 Venezuelan currency
devaluation and non-recurring interest income in 1995 related to investments
restricted for the Hattiesburg facility construction.
INCOME TAXES
The effective income tax rate for both the three and six months ended
June 30, 1996 decreased 3.0 percentage points from the 1995 effective tax rate.
The decrease reflects lower foreign taxes from the utilization of foreign tax
credits and loss carryforwards and lower state income taxes.
NET EARNINGS AND NET EARNINGS PER SHARE
For the three months ended June 30, 1996, net earnings were $7.2 million
compared to $11.4 million for the comparable period of 1995. Net earnings per
share for the three months ended June 30, 1996 decreased from $.14 in 1995 to
$.09 in 1996.
For the six months ended June 30, 1996, net earnings were $24.6 million
compared to $41.4 million for the comparable period in 1995. Net earnings per
share for the six months ended June 30, 1996 decreased from $.50 in 1995 to $.30
in 1996.
8
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1996, the Company had cash and cash equivalents of $35.8
million and total debt of $217.5 million. Cash used in operating activities for
the six months ended June 30, 1996 was $7.2 million compared to cash provided by
operating activities of $10.6 million for the comparable period of 1995. This
decrease is primarily attributable to the reduction in earnings before non-cash
charges and increased inventory levels. Inventory balances at June 30, 1996
reflect increases associated with the Samsonite furniture business, inventory
growth related to bedding products in 1996 and overall increases to support
anticipated sales growth in the second half of 1996. These increased inventory
levels were partially financed by increased trade accounts payable at June 30,
1996. Cash flow from operating activities also benefited in 1996 from a change
in the timing of income tax payments.
Capital spending, inclusive of a $5 million warehouse expansion financed
with a capital lease, totaled $40.2 million for the six months ended June 30,
1996 and was primarily attributable to new product development, cost reduction
initiatives and warehouse expansions. Capital spending in 1995 reflected
approximately $30 million associated with the Hattiesburg project. During the
first six months of 1996, the net increase in the Company's borrowings under its
revolving credit facility was $45 million, primarily to finance working capital
investments.
The Company believes that its cash flow from operations, existing cash
and cash equivalent balances as well as its revolving credit facility will be
sufficient to finance its requirements to support working capital needs, capital
expenditures and debt service in the foreseeable future.
CAUTIONARY STATEMENTS
Certain of the information contained herein may contain "forward looking"
information, as such term is defined by the Private Securities Litigation Reform
Act of 1995 and in releases made by the Securities and Exchange Commission
("SEC" ). Actual results could differ materially from those projected in the
forward-looking statements as a result of various factors, including those set
forth in Exhibit 99.1 to the Company's report on Form 8-K filed with the SEC on
January 30, 1996, which is incorporated herein by reference.
9
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Annual Meeting of Shareholders of the Company was held on July 2,
1996, for the purpose of considering and voting on the election of Directors and
the approval of the 1996 Amendments to the Company's Amended and Restated Equity
Team Plan. The Company's Directors were elected by the following vote:
SHARES VOTED SHARES
FOR WITHHELD
------------ --------
Peter A. Langerman 65,215,348 2,442,612
Richard Ravitch 65,262,239 2,395,721
Charles J. Thayer 65,347,765 2,310,195
Shimon Topor 65,346,288 2,311,672
Raymond S. Troubh 65,385,141 2,272,819
The shareholders also voted to approve the 1996 Amendments to the
Amended and Restated Equity Team Plan, which is fully described in the Company's
Proxy Statement for the 1996 Annual Meeting, by the following vote:
VOTE TO APPROVE THE 1996 AMENDMENTS
TO THE AMENDED AND RESTATED SUNBEAM
CORPORATION EQUITY TEAM PLAN NUMBER OF SHARES
----------------------------------- ----------------
For 57,710,650
Against 8,562,553
Abstain 1,282,689
Broker Non-Votes 102,068
ITEM 5. OTHER INFORMATION
The Board of Directors elected Albert J. Dunlap as Chairman of the
Board and Chief Executive Officer of the Company as of July 18, 1996. In
addition, the employment of the company's former President and Chief Operating
Officer, North America, James J. Clegg was terminated and the following officers
have been elected:
Russell A. Kersh - Executive Vice President, Finance and
Administration
P. Newton White - Executive Vice President, Consumer Products Worldwide
John Dailey - Vice President, Corporate Purchasing and Logistics
On July 31, 1996, the Company announced the formation of an Operating
Committee consisting of Messrs. Dunlap, Kersh, White and David C. Fannin,
Executive Vice President and General Counsel. The Company has issued certain
press releases regarding such management changes and the Company's earnings for
the second quarter of 1996, all of which are attached hereto and incorporated
herein by reference.
10
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
3a. Restated Certificate of Incorporation of the Company.
3b. By-laws of the Company, as amended.
10a. Employment Agreement dated as of July 18, 1996, by and between the
Company and Albert J. Dunlap.
10b. Amended and Restated Sunbeam Corporation Equity Team Plan.
10c. Employment Agreement dated as of June 24, 1996, by and between
the Company and Charles J. Thayer.
10d. Agreement and Release between Roger W. Schipke and the Company
dated May 22, 1996.
10e. Agreement and Release between James J. Clegg and the Company dated
July 23, 1996.
11a. Calculation of Primary Earnings Per Share of Common Stock.
11b. Calculation of Fully Diluted Earnings Per Share of Common Stock.
27. Financial Data Schedule, submitted electronically to the
Securities and Exchange Commission for information only and not
filed.
99.1 Press Release dated July 18, 1996, regarding election of
Albert J. Dunlap.
99.2 Press Release dated July 24, 1996, regarding second quarter 1996
earnings.
99.3 Press Release dated July 24, 1996, regarding employment of Russell
A. Kersh.
99.4 Press Release dated July 24, 1996, regarding departure of
James J. Clegg.
99.5 Press Release dated July 29, 1996, regarding employment of
P. Newton White and John Dailey.
99.6 Press Release dated July 31, 1996, regarding Operating Committee
formation.
(b) Reports on Form 8-K
The Company filed reports on Form 8-K with the Securities Exchange
Commission dated July 19 and 24, 1996.
11
<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 hereunto duly authorized.
SUNBEAM CORPORATION
Date: August 5, 1996
/s/ Robert J. Gluck
----------------------------------
Robert J. Gluck
Vice President, Controller
12
<PAGE>
EXHIBIT INDEX
NUMBER DESCRIPTION
- ------ -----------
3a. Restated Certificate of Incorporation of the Company.
3b. By-laws of the Company, as amended.
10a. Employment Agreement dated as of July 18, 1996, by and between the
Company and Albert J. Dunlap.
10b. Amended and Restated Sunbeam Corporation Equity Team Plan.
10c. Employment Agreement dated as of June 24, 1996, by and between the
Company and Charles J. Thayer.
10d. Agreement and Release between Roger W. Schipke and the Company dated
May 22, 1996.
10e. Agreement and Release between James J. Clegg and the Company dated
July 23, 1996.
11a. Calculation of Primary Earnings Per Share of Common Stock.
11b. Calculation of Fully Diluted Earnings Per Share of Common Stock.
27. Financial Data Schedule, submitted electronically to the Securities and
Exchange Commission for information only and not filed.
99.1 Press Release dated July 18, 1996, regarding election of Albert J.
Dunlap.
99.2 Press Release dated July 24, 1996, regarding second quarter 1996
earnings.
99.3 Press Release dated July 24, 1996, regarding employment of
Russell A. Kersh.
99.4 Press Release dated July 24, 1996, regarding departure of
James J. Clegg.
99.5 Press Release dated July 29, 1996, regarding employment of P. Newton
White and John Dailey.
99.6 Press Release dated July 31, 1996, regarding Operating Committee
formation.
Exhibit 3a
RESTATED CERTIFICATE OF INCORPORATION
OF
SUNBEAM CORPORATION
Sunbeam Corporation, a corporation organized and existing under the laws
of the State of Delaware, hereby certifies as follows:
1. The name of the corporation is Sunbeam Corporation and the name under
which the corporation was originally incorporated is Sunbeam/Oster Companies,
Inc. The date of filing of its original Certificate of Incorporation with the
Secretary of State was October 26, 1989.
2. This Restated Certificate of Incorporation only restates and
integrates and does not further amend the provisions of the Certificate of
Incorporation of this corporation as heretofore amended or supplemented and
there is no discrepancy between those provisions and the provisions of this
Restated Certificate of Incorporation.
3. The text of the Certificate of Incorporation as amended or
supplemented heretofore is hereby restated without further amendments or changes
to read as herein set forth in full.
RESTATED CERTIFICATE OF INCORPORATION
OF
SUNBEAM CORPORATION
FIRST. The name of the corporation is Sunbeam Corporation.
SECOND. The location and post office address of its registered
office in the State of Delaware is 1209 Orange Street, in the City of
Wilmington, County of New Castle. The name of the registered agent at that
address is the Corporation Trust Company.
THIRD. The Corporation shall have unlimited power to engage in
and to do any lawful act concerning any or all lawful business for which
corporations may be incorporated under the Delaware General Corporation Law, as
it may be amended from time to time.
1
<PAGE>
FOURTH. The term of the Corporation's existence is perpetual.
FIFTH. The total number of shares of stock which the Corporation
shall have authority to issue is two hundred two million (202,000,000) shares of
which two hundred million (200,000,000) shares shall be common stock, par value
$.01 per share, and two million (2,000,000) shares shall be preferred stock, par
value $.01 per share.
The designations and the powers, preferences and rights, and the
qualifications, limitations, or restrictions thereof, of each class of stock are
as follows:
The Board of Directors is expressly authorized at any time, and from
time to time, to provide for the issuance of shares of preferred stock in one or
more series, with only such voting powers, full or limited, if any, and with
such designations, preferences and relative, participating, optional or other
special rights, and qualifications, limitations, or restrictions thereof, as
shall be stated and expressed in the resolution or resolutions providing for the
issue thereof adopted by the board of directors, subject to the limitations
prescribed by law and in accordance with the provisions hereof, including (but
without limiting the generality thereof) the following:
(a) The designation of the series and the number of shares to
constitute the series;
(b) The dividend rate, if any, of the series, the conditions and
dates upon which such dividends shall be payable, the relation which such
dividends shall bear to the dividends payable on any other class or classes of
stock, and whether such dividends shall be cumulative or noncumulative;
(c) Whether the shares of the series shall be subject to redemption
by the corporation and, if made subject to such redemption, the times, prices
and other terms and conditions of such redemption;
(d) The terms and amount of any sinking fund provided for the
purchase or redemption of the shares of the series;
(e) Whether or not the shares of the series shall be convertible into
or exchangeable for shares of any other class or classes or of any other series
of any class or classes of stock or debt of the Corporation, and, if provision
be made for conversion or exchange, the times, prices, rates, adjustments and
other terms and conditions of such conversion or exchange;
(f) The extent, if any, to which the holders of the shares of the
series shall be entitled to vote with respect to the election of directors or
otherwise;
(g) The restrictions, if any, on the issue or reissue of any
additional preferred stock; and
(h) The rights of the holders of the shares of the series upon the
dissolution, liquidation, or winding up of the Corporation.
Upon the retirement of any shares of any series of Preferred Stock, such
shares shall resume the status of authorized and unissued shares of Preferred
Stock generally, without limitation as to the powers, designations, preferences
and limitations initially granted to the retired shares.
Subject to the prior or equal rights, if any, of the preferred stock of
any and all series stated and expressed by the Board of Directors in the
resolution or resolutions providing for the issuance of such preferred stock,
the holders of common stock shall be entitled (i) to receive dividends when and
as declared by the Board of Directors out of any funds legally available
therefor, (ii) in the event of any dissolution, liquidation or winding up of the
Corporation, to
2
<PAGE>
receive the remaining assets of the Corporation, ratably according to the number
of shares of common stock held, and (iii) to one vote for each share of common
stock held on all matters submitted to a vote of shareholders. No holder of
common stock shall have any preemptive right to purchase or subscribe for any
part of any issue of stock or of securities of the Corporation convertible into
stock of any class whatsoever, whether now or hereafter authorized.
SIXTH. The Corporation hereby elects not to be governed by
Section 203 of the Delaware General Corporation Law.
SEVENTH. The business and affairs of the Corporation shall be
managed by a Board of Directors. The number of directors constituting the entire
Board shall be not less than three nor more than twelve as fixed from time to
time by vote of a majority of the entire Board, provided, however, that the
number of directors shall not be reduced so as to shorten the term of any
director at the time in office, and provided, further, that the number of
directors constituting the entire Board initially shall be seven until otherwise
fixed by a majority of the entire Board.
EIGHTH. The Board of Directors of the Corporation is expressly
authorized to adopt, amend or repeal by-laws of the Corporation, but the
stockholders may adopt additional by-laws and may amend or repeal any by-law
whether adopted by them or otherwise.
NINTH. Elections of directors need not be by written ballot
except and to the extent provided in the by-laws of the Corporation.
TENTH. No director of the Corporation shall be personally liable
to the Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director; provided, however, that the foregoing clause shall
not eliminate or limit the liability of a director (i) for any breach of the
director's duty of loyalty to the Corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law, or (iv) for any transaction from which the director derived an
improper personal benefit. This Article TENTH shall not eliminate or limit the
liability of a director for any act or omission occurring prior to the time this
Article TENTH became effective. No amendment, alteration, or repeal of this
Article TENTH, nor the adoption of any provision inconsistent with this Article
TENTH, shall adversely affect any limitation on the personal liability of a
director existing at the time of such amendment, modification, or repeal, or the
adoption of such an inconsistent provision.
4. This Restated Certificate of Incorporation was duly adopted by the
Board of Directors in accordance with Section 245 of the General Corporation Law
of the State of Delaware.
3
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IN WITNESS WHEREOF, said Sunbeam Corporation has caused this Restated
Certificate of Incorporation to be signed by David C. Fannin, its Secretary,
this 1st day of July, 1996.
SUNBEAM CORPORATION
By \S\ DAVID C. FANNIN
--------------------
David C. Fannin, Secretary
4
EXHIBIT 3B
BY-LAWS
OF
SUNBEAM CORPORATION
---------------------
ARTICLE I
OFFICES
Section 1.1 REGISTERED OFFICE. The registered office of the Corporation
within the State of Delaware shall be located at the principal place of business
in said State of such corporation or individual acting as the Corporation's
registered agent in Delaware.
Section 1.2 OTHER OFFICES. The Corporation may also have offices and
places of business at such other places both within and without the State of
Delaware as the Board of Directors may from time to time determine or the
business of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1 PLACE OF MEETINGS. All meetings of stockholders shall be
held at the principal office of the Corporation, or at such other place within
or without the State of Delaware as shall be stated in the notice of the meeting
or in a duly executed waiver of notice thereof.
Section 2.2 ANNUAL MEETINGS. The annual meeting of stockholders for the
election of directors shall be held at such time on such day, other than a legal
holiday, as the Board of Directors in each such year determines. At the annual
meeting, the stockholders entitled to vote for the election of directors shall
elect, by a plurality vote, a Board of Directors and transact such other
business as may properly come before the meeting.
Section 2.3 SPECIAL MEETINGS. Special meetings of stockholders, for any
purpose or purposes, may be called by the Chairman of the Board of Directors.
Any such request shall state the purpose or purposes of the proposed meeting. At
any special meeting of stockholders, only such business may be transacted as is
related to the purpose or purposes set forth in the notice of such meeting.
Section 2.4 NOTICE OF MEETINGS. Written notice of every meeting of
stockholders, stating the place, date and hour thereof and, in the case of a
special meeting of stockholders, the purpose or purposes thereof and the person
or persons by whom or at whose direction such meeting has been called and such
notice is being issued, shall be given not less than ten (10) nor more than
sixty (60) days before the date of the meeting, either personally or by mail, by
or at
<PAGE>
the direction of the Chairman of the Board, to each stockholder of record
entitled to vote at such meeting. If mailed, such notice shall be deemed to be
given when deposited in the United States mail, postage prepaid, directed to the
stockholder at his address as it appears on the stock transfer books of the
Corporation. Nothing herein contained shall preclude the stockholders from
waiving notice as provided in Section 4.1 hereof.
Section 2.5 QUORUM. The holders of a majority of the issued and
outstanding shares of stock of the Corporation entitled to vote, represented in
person or by proxy, shall be necessary to and shall constitute a quorum for the
transaction of business at any meeting of stockholders. If, however, such quorum
shall not be present or represented at any meeting of stockholders, the
stockholders entitled to vote thereat, present in person or represented by
proxy, shall have power to adjourn the meeting from time to time, without notice
other than announcement at the meeting, until a quorum shall be present or
represented. At any such adjourned meeting at which a quorum shall be present or
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed. Notwithstanding the foregoing, if after any
such adjournment the Board of Directors shall fix a new record date for the
adjourned meeting, or if the adjournment is for more than thirty (30) days, a
notice of such adjourned meeting shall be given as provided in Section 2.4
hereof, but such notice may be waived as provided in Section 4.1 hereof.
Section 2.6 VOTING. At each meeting of stockholders, each holder of
record of shares of stock entitled to vote shall be entitled to vote in person
or by proxy, and each such holder shall be entitled to one vote for every share
standing in his name on the books of the Corporation as of the record date fixed
by the Board of Directors or prescribed by law and, if a quorum is present, a
majority of the shares of such stock present or represented at any meeting of
stockholders shall be the vote of the stockholders with respect to any item of
business, unless otherwise provided by any applicable provision of law, by these
By-Laws or by the Certificate of Incorporation.
Section 2.7 PROXIES. Every stockholder entitled to vote at a meeting or
by consent without a meeting may authorize another person or persons to act for
him by proxy. Each proxy shall be in writing executed by the stockholder giving
the proxy or by his duly authorized attorney. No proxy shall be valid after the
expiration of three (3) years from its date, unless a longer period is provided
for in the proxy. Unless and until voted, every proxy shall be revocable at the
pleasure of the person who executed it, or his legal representatives or assigns
except in those cases where an irrevocable proxy permitted by statute has been
given.
Section 2.8 CONSENTS. Whenever a vote of stockholders at a meeting
thereof is required or permitted to be taken in connection with any corporate
action by any provision of statute, the Certificate of Incorporation or these
By-Laws, the meeting, prior notice thereof and vote of stockholders may be
dispensed with if the holders of shares having not less than the minimum number
of votes that would have been necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted
shall consent in writing to the taking of such action. Where corporate action is
taken in such matter by less than unanimous written consent, prompt written
notice of the taking of such action shall be given thereto.
<PAGE>
Section 2.9 STOCK RECORDS. The Secretary or agent having charge of the
stock transfer books shall make, at least ten (10) days before each meeting of
stockholders, a complete list of the stockholders entitled to vote at such
meeting or any adjournment thereof, arranged in alphabetical order and showing
the address of and the number and class and series, if any, of shares held by
each. For a period of ten (10) days prior to such meeting, such list shall be
kept at the principal place of business of the Corporation or at the office of
the transfer agent or registrar of the Corporation and such other places as
required by statute and shall be subject to inspection by any stockholder at any
time during usual business hours. Such list shall also be produced and kept open
at the time and place of the meeting and shall be subject to the inspection of
any stockholder at any time during the meeting.
ARTICLE III
DIRECTORS
Section 3.1 NUMBER. The number of directors of the Corporation which
shall constitute the entire Board of Directors shall not be less than three nor
more than twelve as fixed from time to time by a vote of a majority of the
entire Board, provided, however, that the number of directors shall not be
reduced so as to shorten the term of any director at the time in office.
Section 3.2 RESIGNATION AND REMOVAL. Any director may resign at any
time upon notice of resignation to the Corporation. Any director may be removed
at any time by vote of the stockholders then entitled to vote for the election
of directors at a special meeting called for that purpose, either with or
without cause.
Section 3.3 NEWLY CREATED DIRECTORSHIP AND VACANCIES. Newly created
directorships resulting from an increase in the number of directors and
vacancies occurring in the Board of Directors for any reason whatsoever shall be
filled by vote of the Board. If the number of directors then in office is less
than a quorum, such newly created directorships and vacancies may be filled by a
vote of a majority of the directors then in office. Any director elected to fill
a vacancy shall be elected until the next meeting of stockholders at which the
election of directors is in the regular course of business, and until his
successor has been elected and qualified.
Section 3.4 POWERS AND DUTIES. Subject to the applicable provisions of
law, these By-Laws or the Certificate of Incorporation, but in furtherance and
not in limitation of any rights therein conferred, the Board of Directors shall
have the control and management of the business and affairs of the Corporation
and shall exercise all such powers of the Corporation and do all such lawful
acts and things as may be exercised by the Corporation.
Section 3.5 PLACE OF MEETINGS. All meetings of the Board of Directors
may be held either within or without the State of Delaware.
Section 3.6 ANNUAL MEETINGS. An annual meeting of each newly elected
Board of Directors shall be held immediately following the annual meeting of
stockholders, and no notice of such meeting to the newly elected directors shall
be necessary in order to legally constitute the
<PAGE>
meeting, provided a quorum shall be present, or the newly elected directors may
act by the written consent of all of such directors.
Section 3.7 REGULAR MEETINGS. Regular meetings of the Board of
Directors may be held without notice, and at such time and at such place as
shall from time to time be fixed, in advance, by resolution of the Board.
Section 3.8 SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by the Chairman of the Board. Written notice of each
special meeting of directors stating the time and place of the meeting shall be
given to each director at least twenty-four (24) hours before such meeting,
provided that neither the business to be transacted at, nor the purpose of, any
special meeting of the Board of Directors need be specified in the notice or
waiver of notice of such meeting.
Section 3.9 NOTICE OF MEETINGS. Notice of each special meeting of the
Board shall be given by the Secretary or an Assistant Secretary and shall state
the place, date and time of the meeting. Notice of each such meeting shall be
given orally or shall be mailed to each director at his residence or usual place
of business. If notice of less than three (3) days is given, it shall be oral,
whether by telephone or in person, or sent by special delivery mail, facsimile
or telegraph. If mailed, the notice shall be given when deposited in the United
States mail, postage prepaid. Notice of any adjourned meeting, including the
place, date and time of the new meeting, shall be given to all directors not
present at the time of the adjournment, as well as to the other directors unless
the place, date and time of the new meeting is announced at the adjourned
meeting. Nothing herein contained shall preclude the directors from waiving
notice as provided in Section 4.1 hereof.
Section 3.10 QUORUM AND VOTING. At all meetings of the Board of
Directors, a majority of the entire Board shall be necessary to and shall
constitute a quorum for the transaction of business, unless otherwise provided
by any applicable provision of law, by these By-Laws, or by the Certificate of
Incorporation. The act of a majority of the directors present at the time of the
vote, if a quorum is present at such time, shall be the act of the Board of
Directors, unless otherwise provided by an applicable provision of law, by these
By-Laws or by the Certificate of Incorporation. If a quorum shall not be present
at any meeting of the Board of Directors, the directors present thereat may
adjourn the meeting from time to time, until a quorum shall be present.
Section 3.11 COMPENSATION. The salaries and other compensation of
directors for services to the Corporation as directors, officers or otherwise
shall be fixed by, or in the manner prescribed by, the Board of Directors,
irrespective of any personal interest of any of its members.
Section 3.12 BOOKS AND RECORDS. The directors may keep the books of the
Corporation, except such as are required by law to be kept within the state,
outside of the State of Delaware, at such place or places as they may from time
to time determine.
Section 3.13 ACTION WITHOUT A MEETING. Any action required or permitted
to be taken by the Board, or by a committee of the Board, may be taken without a
meeting if all members
<PAGE>
of the Board or the committee, as the case may be, consent in writing to the
adoption of a resolution authorizing the action. Any such resolution and the
written consents thereto by the members of the Board or committee shall be filed
with the minutes of the proceedings of the Board or committee.
Section 3.14 TELEPHONE PARTICIPATION. Any one or more members of the
Board, or any committee of the Board, may participate in a meeting of the Board
or committee by means of a conference telephone call or similar communications
equipment allowing all persons participating in the meeting to hear each other
at the same time. Participation by such means shall constitute presence in
person at a meeting.
Section 3.15 EXECUTIVE COMMITTEE. The Board of Directors may, by
resolution adopted by the Board, appoint an Executive Committee consisting of
not less than three (3) directors, at least one of whom is not a beneficial
owner, or the representative of a beneficial owner, of 10% or more of the
Corporation's outstanding common stock. The Executive Committee shall keep
minutes of its meetings and report the same to the Board. The Executive
Committee, subject to the last sentence of Section 3.16 of these By-laws, shall
have and may exercise all of the powers of the Board.
Section 3.16 OTHER COMMITTEES OF THE BOARD. The Board, by resolution
adopted by a majority of the entire Board, may designate such other committees,
each consisting of one or more directors and having such title as the Board may
consider to be a proper description of its function. The Board may designate one
or more directors as alternate members of any such other committee. Such
alternate members may replace any absent member or members at any meeting of
such other committee. Each other committee (including the members thereof) shall
serve at the pleasure of the Board and shall keep minutes of its meetings and
report the same to the Board. Except as otherwise provided by law, each such
committee, to the extent provided in the resolution establishing it, shall have
and may exercise all the authority of the Board with respect to all matters.
However, no such other committee shall have power or authority to:
A. amend the Certificate of Incorporation;
B. adopt an agreement of merger or consolidation;
C. recommend to the stockholders the sale, lease or
exchange of all or substantially all of the Corporation's property and assets;
D. recommend to the stockholders a dissolution of the
Corporation or a revocation of a dissolution;
E. amend these By-Laws; and
F. unless expressly so provided by resolution of the Board,
(i) declare a dividend; or (ii) authorize the issuance of shares of the
Corporation of any class.
<PAGE>
Section 3.17 DIRECTORS EMERITI. No nominee for election as a director
shall be seventy-five (75) years of age or older on the date of election. A
director who attains the age of seventy-five (75) during his or her term of
office shall complete his or her term of office but shall not be eligible to
stand for reelection and shall assume the position of Director Emeritus (or
Emerita) at the end of the term of service following his or her 75th birthday.
Directors Emeriti shall be entitled to attend all meetings of the Board of
Directors and shall be entitled to attend meetings of the committees of the
Board of Directors upon invitation. Directors Emeriti shall not be compensated
for attendance at such meetings nor shall they be compensated for service as
Directors Emeriti but they shall be reimbursed for travel expenses incurred in
attending any meeting of the Board of Directors or its committees. Directors
Emeriti shall not be entitled to vote at any meeting which they attend and their
attendance shall not be considered in determining whether a quorum is present at
any meeting of the Board of Directors or its committees.
ARTICLE IV
WAIVER
Section 4.1 WAIVER. Whenever a notice is required to be given by any
provision of law, by these By-Laws, or by the Certificate of Incorporation, a
written waiver, signed by the person entitled to notice, whether before or after
the time stated therein, shall be deemed equivalent to such notice. Attendance
of a person at a meeting shall constitute a waiver of notice of such meeting,
except when the person attends a meeting for the express purpose of objecting at
the beginning of the meeting, to the transaction of any business because the
meeting is not lawfully called or convened.
ARTICLE V
OFFICERS
Section 5.1 EXECUTIVE OFFICERS. The officers of the Corporation shall
be the Chairman of the Board, a Treasurer and Secretary. Any person may hold two
or more of such offices. The officers of the Corporation shall be elected
annually (and from time to time by the Board of Directors, as vacancies occur),
at the annual meeting of the Board of Directors following the meeting of
stockholders at which the Board of Directors was elected.
Section 5.2 OTHER OFFICERS. The Board of Directors may appoint such
other officers and agents, including a Chief Executive Officer, President, Chief
Financial Officer, Vice President, Assistant Vice Presidents, Secretaries,
Assistant Secretaries and Assistant Treasurers, as it shall at any time or from
time to time deem necessary or advisable.
Section 5.3 AUTHORITIES AND DUTIES. All officers, as between themselves
and the Corporation, shall have such authority and perform such duties in the
management of business and affairs of the Corporation as may be provided in
these By-Laws, or, to the extent not so provided, as may be prescribed by the
Board of Directors.
<PAGE>
Section 5.4 TENURE AND REMOVAL. The officers of the Corporation shall
be elected or appointed to hold office until their respective successors are
elected or appointed. All officers shall hold office at the pleasure of the
Board of Directors, and any officer elected or appointed by the Board of
Directors may be removed at any time by the Board of Directors for cause or
without cause at any regular or special meeting.
Section 5.5 VACANCIES. Any vacancy occurring in any office of the
Corporation, whether because of death, resignation or removal, with or without
cause, or any other reason, shall be filled by the Board of Directors.
Section 5.6 COMPENSATION. The salaries and other compensation of all
officers and agents of the Corporation shall be fixed by or in the manner
prescribed by the Board of Directors.
Section 5.7 CHAIRMAN OF THE BOARD. The Chairman of the Board shall have
the general charge of the business and affairs of the Corporation and shall
preside at all meetings of the stockholders and the directors. The Chairman
shall see to it that all resolutions and orders of the Board are carried into
effect, and, in connection therewith, shall be authorized to delegate the other
executive officers such of his powers and duties as Chairman of the Board at
such times and in such manner as he may deem advisable. In the event that the
Corporation shall at any time or from time to time own or have power to vote any
securities of any other issuer, such securities shall be voted by the Chairman
of the Board. The Chairman of the Board shall perform such other duties as are
properly required of him by the Board of Directors.
Section 5.8 PRESIDENT. The President, if and when appointed or elected,
shall assist the Chairman of the Board in the management of the business of the
Corporation and, in the absence of the Chairman, he shall preside at all
meetings of the stockholders and the directors and exercise the other powers and
perform the other duties of the Chairman or designate the executive officers of
the Corporation by whom such other powers shall be exercised and other duties
performed; and he shall have such other powers and duties as the Board of
Directors or Chairman of the Board may from time to time prescribe. Except where
by law or by order of the Board of Directors the signature of the Chairman of
the Board is required, the President shall have the same power as the Chairman
of the Board to execute instruments on behalf of the Corporation.
Section 5.9 SECRETARY. The Secretary shall attend all meetings of the
stockholders and all meetings of the Board of Directors and shall record all
proceedings taken at such meetings in a book to be kept for that purpose; he
shall see that all notices of meetings of stockholders and meetings of the Board
of Directors are duly given in accordance with the provisions of these By-Laws
or as required by law; he shall be the custodian of the records and of the
corporate seal or seals of the Corporation; he shall have authority to affix the
corporate seal or seals to all documents, the execution of which, on behalf of
the Corporation, under its seal, is duly authorized, and when so affixed it may
be attested by his signature; and in general, he shall perform all duties
incident to the office of the Secretary of a corporation, and such other duties
as the Board of Directors may from time to time prescribe.
Section 5.10 TREASURER. The Treasurer shall have charge of and be
responsible for all funds, securities, receipts and disbursements of the
Corporation and shall deposit, or cause to be
<PAGE>
deposited, in the name and to the credit of the Corporation, all moneys and
valuable effects in such banks, trust companies, or other depositories as shall
from time to time be selected by the Board of Directors. He shall keep full and
accurate accounts of receipts and disbursements in books belonging to the
Corporation; he shall render to the Chairman of the Board and to each member of
the Board of Directors, whenever requested, an account of all of his
transactions as Treasurer and of the financial condition of the Corporation; and
in general, he shall perform all of the duties incident to the office of the
Treasurer of a corporation, and such other duties as the Board of Directors may
from time to time prescribe.
Section 5.11 OTHER OFFICERS. The Board of Directors may also elect or
may delegate to the Chairman of the Board the power to appoint such other
officers as it may at any time or from time to time deem advisable, and any
officers so elected or appointed shall have such authority and perform such
duties as the Board of Directors or the Chairman of the Board, if he shall have
appointed them, may from time to time prescribe.
ARTICLE VI
PROVISIONS RELATING TO STOCK CERTIFICATES AND STOCKHOLDERS
Section 6.1 FORM AND SIGNATURE. The shares of the Corporation shall be
represented by a certificate signed by the Chairman of the Board or the
President or any Vice President and by the Secretary or any Assistant Secretary
or the Treasurer, or any Assistant Treasurer, and shall bear the seal of the
Corporation or a facsimile thereof. Each certificate representing shares shall
state upon its face (a) that the Corporation is formed under the laws of the
State of Delaware, (b) the name of the person or persons to whom it is issued,
(c) the number of shares which such certificate represents and (d) the par
value, if any, of each share represented by such certificate.
Section 6.2 REGISTERED STOCKHOLDERS. The Corporation shall be entitled
to recognize the exclusive right of a person registered on its books as the
owner of shares of stock to receive dividends or other distributions, and to
vote as such owner, and to hold liable for calls and assessments a person
registered on its books as the owner of stock, and shall not be bound to
recognize any equitable or legal claim to or interest in such shares on the part
of any other person.
Section 6.3 TRANSFER OF STOCK. Upon surrender to the Corporation or the
appropriate transfer agent, if any, of the Corporation, of a certificate
representing shares of stock duly endorsed or accompanied by proper evidence of
succession, assignment or authority to transfer, and, in the event that the
certificate refers to any agreement restricting transfer of the shares which it
represents, proper evidence of compliance with such agreement, a new certificate
shall be issued to the person entitled thereto, and the old certificate
cancelled and the transaction recorded upon the books of the Corporation.
Section 6.4 LOST CERTIFICATES, ETC. The Corporation may issue a new
certificate for shares in place of any certificate theretofore issued by it,
alleged to have been lost, mutilated, stolen or destroyed, and the Board may
require the owner of such lost, mutilated, stolen or destroyed certificate, or
his legal representatives, to make an affidavit of the fact and/or to give
<PAGE>
the Corporation a bond in such sum as it may direct as indemnity against any
claim that may be made against the Corporation on account of the alleged loss,
mutilation, theft or destruction of any such certificate or the issuance of any
such new certificate.
Section 6.5 RECORD DATE. For the purpose of determining the
stockholders entitled to notice of, or to vote at, any meeting of stockholders
or any adjournment thereof, or to express written consent to any corporate
action without a meeting, or for the purpose of determining stockholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights, or entitled 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 may fix, in advance, a record date. Such date shall not be more than
sixty (60) nor less than ten (10) days before the date of any such meeting, nor
more than sixty (60) days prior to any other action.
Section 6.6 REGULATIONS. Except as otherwise provided by law, the Board
may make such additional rules and regulations, not inconsistent with these
By-Laws, as it may deem expedient, concerning the issue, transfer and
registration of certificates for the securities of the Corporation. The Board
may appoint, or authorize any officer of officers to appoint, one or more
transfer agents and one or more registrars and may require all certificates for
shares of capital stock to bear the signature or signatures of any of them.
ARTICLE VII
GENERAL PROVISIONS
Section 7.1 DIVIDENDS AND DISTRIBUTIONS. Dividends and other
distributions upon or with respect to outstanding shares of stock of the
Corporation may be declared by the Board of Directors at any regular or special
meeting, and may be paid in cash, bonds, property, or in stock of the
Corporation. The Board shall have full power and discretion, subject to the
provisions of the Certificate of Incorporation or the terms of any other
corporate document or instrument to determine what, if any, dividends or
distributions shall be declared and paid or made.
Section 7.2 CHECKS, ETC. All checks or demands for money and notes or
other instruments evidencing indebtedness or obligations of the Corporation
shall be signed by such officer or officers or other person or persons as may
from time to time be designated by the Board of Directors.
Section 7.3 SEAL. The corporate seal shall have inscribed thereon the
name of the Corporation, the year of its incorporation and the words "Corporate
Seal Delaware". The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or otherwise reproduced.
Section 7.4 FISCAL YEAR. The fiscal year of the Corporation shall end
on the Sunday closest to December 31 each year.
Section 7.5 GENERAL AND SPECIAL BANK ACCOUNTS. The Board may authorize
from time to time the opening and keeping of general and special bank accounts
with such banks, trust
<PAGE>
companies or other depositories as the Board may designate or as may be
designated by any officer or officers of the Corporation to whom such power of
designation may be delegated by the Board from time to time. The Board may make
such special rules and regulations with respect to such bank accounts, not
inconsistent with the provisions of these By-Laws, as it may deem expedient.
ARTICLE VIII
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHER PERSONS
Section 8.1 INDEMNIFICATION BY CORPORATION. To the extent permitted by
law, 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) the Corporation shall indemnify
any person against any and all judgments, fines, amounts paid in settling or
otherwise disposing of threatened, pending or completed actions, suits or
proceedings, whether civil, criminal, administrative or investigative and
expenses in connection therewith, incurred by reason of the fact that he, his
testator or intestate is or was a director or officer of, or a plan fiduciary or
plan administrator of any employee benefit plan sponsored by, the Corporation or
of any other corporation of any type or kind, domestic or foreign, which he
served in any capacity at the request of the Corporation. To the extent
permitted by law, expenses so incurred by any such person in defending a civil
or criminal action or proceeding shall at his request be paid by the Corporation
in advance of the final disposition of such action or proceeding. The foregoing
right of indemnification shall in no way be exclusive of any other rights or
indemnification to which any such person may be entitled, under any By-law,
agreement, vote of shareholders or disinterested directors or otherwise, and
shall inure to the benefit of the heirs, executors and administrators of such a
person.
ARTICLE IX
ADOPTION AND AMENDMENTS
Section 9.1 POWER TO AMEND. These By-Laws may be amended or repealed
and any new By-Laws may be adopted by the Board of Directors; provided that
these By-Laws and any other By-Laws amended or adopted by the Board of Directors
may be amended, may be reinstated, and new By-Laws may be adopted, by the
stockholders of the Corporation entitled to vote at the time for the election of
directors.
EXHIBIT 10.A
EMPLOYMENT AGREEMENT
by and between
SUNBEAM CORPORATION
and
ALBERT J. DUNLAP
Effective as of July 18, 1996
<PAGE>
EMPLOYMENT AGREEMENT
AGREEMENT, effective as of July 18, 1996 (the "Effective Date"), by
and between Albert J. Dunlap (the "Executive") and Sunbeam Corporation, a
Delaware corporation (the "Company").
WHEREAS, the Board of Directors of the Company (the "Board") desires
to employ the Executive and the Executive desires to furnish services to the
Company on the terms and conditions hereinafter set forth; and
WHEREAS, the parties desire to enter into this agreement setting
forth the terms and conditions of the employment relationship of the Executive
with the Company;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements set forth below, the parties hereby agree as follows:
1. EMPLOYMENT. The Company hereby agrees to employ the Executive,
and the Executive hereby accepts such employment, on the terms and conditions
hereinafter set forth.
2. EMPLOYMENT PERIOD. The period of employment of the Executive by
the Company hereunder (the "Employment Period") shall commence on the Effective
Date and shall end on July 17, 1999 (or the Date of Termination (as defined in
Section 6 below), if earlier). Commencing on July 18, 1999, the Employment
Period shall be extended for successive one year periods (individually, a
"Renewal Period"), unless a notice not to extend this Agreement shall have been
given by either party hereto to the other not later than April 1 immediately
preceding the commencement of a Renewal Period or unless the Date of Termination
shall have previously occurred; provided, however, that the last such Renewal
Period shall be the Renewal Period ending on July 17, 2001. Unless the context
suggests otherwise, the Employment Period hereunder
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shall for all purposes of this Agreement be deemed to include any Renewal
Period.
3. POSITION AND DUTIES. The Executive shall serve as Chairman of the
Board and Chief Executive Officer and as a director of the Company and shall
report to directly to the Board. During the Employment Period, subject to the
supervisory powers of the Board, the Executive shall have those powers and
duties consistent with his position as Chairman of the Board and Chief Executive
Officer, which powers shall in all cases include, without limitation, the power
of supervision and control over and responsibility for the general management
and operation of the Company. The Executive agrees to devote substantially all
his working time, attention and energies to the performance of his duties for
the Company. It shall not be a violation of this Agreement for the Executive to
(i) serve on corporate, civic or charitable boards or committees, (ii) give
speeches and make media appearances to discuss matters of public interest and
(iii) manage his personal investments, so long as such activities do not
unreasonably interfere with the performance of the Executive's responsibilities
as an officer of the Company in accordance with this Agreement. It is understood
that the Executive has made a commitment to appear in various cities in the
United States in connection with the forthcoming publication of a book entitled
MEAN BUSINESS, of which he is a co-author, and it shall not be a violation of
this Agreement for the Executive to make such appearances (the expenses relating
to such appearances to be borne by the Executive). The Company shall nominate
the Executive as a director of the Company and shall use its best efforts to
have the Executive elected and reelected to the Board for the duration of the
Employment Period. The Company shall also use its best efforts to cause (i) the
Board to be expanded from six to not more than nine members and (ii) three
individuals, designated by the Executive to be elected and reelected as
directors of the Company for the duration of the Employment Period. In the event
that any of such individuals fails to qualify or be elected (or, having been
elected, resigns, is removed or fails to be re-elected) during the Employment
Period, the Executive shall designate a successor reasonably acceptable to the
Board and the Company shall nominate such person as a
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director and shall use its best efforts to cause such person to be elected and
reelected.
4. PLACE OF PERFORMANCE. The principal place of employment of the
Executive shall be at the Company's principal executive offices in Fort
Lauderdale, Florida, or such other location as may be agreed to by the Board and
the Executive. In the event that the Company's principal executive offices are
moved from Fort Lauderdale, Florida, the Company shall promptly pay, or
reimburse the Executive for, all reasonable expenses incurred by the Executive
for a period of one year relating to any change of the Executive's residence
from Boca Raton, Florida, in connection with his employment hereunder,
including, without limitation, reasonable expenses for himself and his family of
travel, moving, storage and suitable lodging and maintenance, and the Company
shall reimburse the Executive on a grossed up basis in the event that any tax is
assessed upon him in relation to any such expenses. The Company shall pay or
reimburse the Executive for all reasonable costs and expenses of residential
relocation incurred by him for a period of one year in connection with each and
every additional change, if any, in the location of the principal executive
offices of the Company, and the Executive shall be reimbursed by the Company on
a grossed up basis in the event that any tax is assessed upon him in relation to
any such costs or expenses.
5. COMPENSATION AND RELATED MATTERS.
(a) BASE SALARY. As compensation for the performance by the
Executive of his duties hereunder, during the Employment Period the Company
shall pay the Executive a base salary at an annual rate of $1,000,000 (the base
salary, at the rate in effect from time to time, is hereinafter referred to as
the "Base Salary"). The Base Salary shall be payable in equal semi-monthly
installments and may be increased from time to time at the discretion of the
Company's Compensation Committee (or any successor thereof) and the Board. Base
Salary shall not be reduced after any increase thereof.
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(b) EQUITY GRANTS.
(1) PURCHASED SHARES. Effective as of the Effective Date,
the Executive shall purchase from the Company for his own account, and the
Company shall sell to the Executive, for the sum of $3,000,000 that number of
shares of the Company's Common Stock, par value $.01 per share ("Common Stock"),
determined by dividing $3,000,000 by the closing price per share of such shares
on the New York Stock Exchange ("NYSE") on July 17, 1996 ($12.25). Such shares
shall be the sole property of the Executive, shall be unrestricted and shall be
freely tradeable by the Executive, subject to applicable legal restrictions.
Within six (6) months after the Effective Date, the Company shall cause the
shares to be registered or qualified for resale under the Securities Act of 1933
and applicable state laws.
(2) RESTRICTED SHARES. Effective as of the Effective Date, the
Executive is hereby granted, without cost to the Executive, 1,000,000 shares of
the Company's Common Stock, on the terms and conditions set forth herein.
One-third of such shares (the "Unrestricted Shares") shall be vested upon the
Effective Date and the remaining shares (the "Restricted Shares") shall vest and
cease to be restricted in two equal installments on the first and second
anniversaries of the Effective Date (subject to earlier vesting provisions set
forth in Section 5(b)(4) and earlier vesting and forfeiture provisions set forth
in Section 7). All such shares, once vested, shall be the sole property of the
Executive, shall be unrestricted and shall be freely tradeable by the Executive,
subject to applicable legal restrictions. Within six (6) months after the
Effective Date, the Company shall cause all such shares to be registered or
qualified for resale under the Securities Act of 1933 and applicable state laws.
(i) ISSUANCE OF CERTIFICATES. The Unrestricted Shares shall be
registered in the Executive's name, and the certificates therefor shall be
delivered to the Executive within 10 days after the Effective Date. The
Restricted Shares shall be registered in the Executive's name, but the
certificates evidencing the Restricted Shares shall be re-
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tained by the Company until such shares become vested and the restrictions
thereon lapse. The period prior to the time that any particular Restricted
Shares become vested and the restrictions thereon lapse is hereinafter
referred to as the "Restricted Period" with respect to such shares. The
Executive shall execute a stock power, in blank, with respect to such
Restricted Shares and deliver the same to the Company.
(ii) RIGHTS AS A STOCKHOLDER. Except as provided herein, during the
Restricted Period, the Executive shall have all the rights of a
stockholder with respect to Restricted Shares, including the right to
receive dividends or other distributions and the right to vote such
shares; provided that, in the discretion of the Company any such dividends
or other distributions may be retained by the Company unless and until the
Restricted Shares in respect of which such dividends or other
distributions were paid shall vest.
(iii) NON-TRANSFERABILITY. During the Restricted Period, the
Executive may not sell, transfer, pledge, or otherwise encumber or dispose
of the Restricted Shares, and any attempted sale, transfer, pledge or
other encumbrance or disposition (whether voluntary or involuntary) in
violation of this Section 5(b)(2)(iii) shall be null and void.
(iv) DELIVERY OF SHARE CERTIFICATES. Upon the vesting of any
Restricted Shares, the certificates evidencing such Restricted Shares,
together with any dividends or other distributions retained by the Company
pursuant to Section 5(b)(2)(ii), shall be delivered promptly to the
Executive. In the case of Executive's death, such certificates, dividends
and distributions will be delivered to the beneficiary designated in
writing by the Executive pursuant to a form of designation provided by the
Company, to the Executive's legatee or legatees, or to his personal
representatives or distributees, as the case may be. Unless and until
registered under the Securities Act of 1933, as amended, certificates
evidencing the shares purchased by the Executive pursuant to Sec-
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tion 5(b)(1) hereof, the Restricted Shares, the Unrestricted Shares, and
shares acquired pursuant to the exercise of the Option (as defined in
Section 5(b)(3) below) shall bear the following legend:
THE SHARES EVIDENCED BY THIS CERTIFICATE MAY NOT BE SOLD,
TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNLESS,
IN THE OPINION OF COUNSEL FOR THE COMPANY, SUCH REGISTRATION IS NOT
REQUIRED.
(3) STOCK OPTIONS. Effective as of the Effective Date, and subject
to shareholder approval by Company's shareholders at a special meeting to be
held for that purpose prior to September 30, 1996 (the "Special Meeting"), the
Executive is hereby granted a non-qualified stock option (an "Option") to
purchase 2,500,000 shares of Common Stock (the "Option Award"). The Option Award
is subject to the following conditions: (i) the exercise price per share of
Common Stock shall be equal to the closing price per share on the NYSE on July
17, 1996 ($12.25), (ii) the Option Award shall vest and become exercisable with
respect to one-third (1/3) of the shares of Common Stock subject to such award
on the Effective Date and an additional one-third (1/3) of the shares of Common
Stock subject to such award on each of the first and second anniversaries of the
Effective Date (subject to earlier vesting provisions set forth in Section
5(b)(4) and earlier vesting and forfeiture provisions set forth in Section 7),
and (iii) the Option Award shall expire on the tenth anniversary of the
Effective Date, subject to earlier termination as provided herein. Within six
(6) months after the Effective Date the Company shall cause all shares subject
to the Option to be registered or qualified for resale under the Securities Act
of 1933 and applicable state laws. In the event that Company's shareholders fail
to approve the grant of the Option at the Special Meeting, the Company and the
Executive shall negotiate in good faith a mutually acceptable alternative
compensation arrangement; provided, however, that the Executive, in his sole
discretion, may elect to terminate this Agreement, in which event it shall be
deemed to have been terminated pursuant to Section 6(d) hereof and the Executive
shall be entitled to receive the
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<PAGE>
compensation, rights and benefits provided in Section 7(e) hereof (other than in
respect of stock options).
(4) SPECIAL VESTING OF EQUITY GRANTS. Anything herein to the
contrary notwithstanding, if a Change in Control occurs during the Employment
Period and the Executive has remained continually employed by the Company from
the Effective Date to the date of the Change in Control, the Restricted Shares
that have not theretofore vested shall vest and the Option Award, to the extent
not theretofore vested and exercisable, shall become fully vested and
exercisable, upon the occurrence of such Change in Control. For purposes of this
Agreement, a Change in Control shall mean the occurrence of any one of the
following events:
(A) any "person" as such term is used in Sec- tions 3(a)(9) and
13(d) of the Securities Exchange Act of 1934, as amended,
becomes a "beneficial owner," as such term is used in Rule
3d-3 promulgated under that act, of 25% or more of the voting
stock of the company (other than a person that is cur- rently
the beneficial owner of such per- centage of the Company's
voting stock);
(B) the majority of the Board consists of individuals other than
Incumbent Direc- tors, which term means the members of the
Board on the date of this Agreement, the Executive and the
individuals designated as directors by the Executive in accor-
dance with Section 3 hereof; provided that any person becoming
a director sub- sequent to such date whose election or
nomination for election was supported by two-thirds of the
directors who then com- prised the Incumbent Directors shall
be considered to be an Incumbent Director;
(C) the Company, without the Executive's consent, adopts any plan
of liquidation providing for the distribution of all or
substantially all of its assets; or
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(D) all or substantially all of the assets or business of the
Company are disposed of pursuant to a merger, consolidation or
other transaction (unless the shareholders of the Company
immediately prior to such merger, consolidation or other
transaction beneficially own, directly or indirectly, in
substantially the same proportion as they owned the voting
stock of the Compa- ny, all of the voting stock or other own-
ership interests of the entity or enti- ties, if any, that
succeed to the business of the Company).
(c) EXPENSES. During the Employment Period, the Company shall
reimburse the Executive for all reasonable business expenses in accordance with
applicable policies and procedures then in force, including, without limitation,
first class travel, lodging and other expenses incurred by him. In light of the
fact that the Executive may be required to travel for extended period of time,
such expenses shall include all reasonable expenses of the Executive's wife for
travel with the Executive in the service of the Company.
(d) VACATION AND OTHER ABSENCES. The Executive shall be
entitled to paid vacation and other paid absences, whether for holidays,
illness, personal time or any similar purposes, during the Employment Period in
accordance with policies applicable generally to senior executives of the
Company; provided, however, that the Executive shall always be entitled to at
least six weeks of paid vacation in each calendar year and pro rata for part of
a year and shall be compensated at the conclusion of each calendar year for any
unused vacation days.
(e) AUTOMOBILE. The Company shall purchase from the Executive
at his cost the Mercedes automobile currently owned by him and shall provide to
the Executive, every two years thereafter, during the Employment Period, a new
automobile, comparable in type and style, for his exclusive use. The Company
shall reimburse the Executive for all reasonable expenses incurred in the use
and maintenance of such automobile, and will
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also provide the Executive with a driver on a full-time basis for security and
safety reasons. The Company shall reimburse the Executive on a grossed up basis
in the event that any tax is assessed upon him in relation to such driver or
expenses.
(f) CLUB MEMBERSHIP. During the Employment Period, the Company
shall pay any and all initiation fees, monthly membership dues, and
company-related expenses in connection with the continuation of the Executive's
current country club membership and for comparable country club membership in
the event of a relocation of the Company's principal executive office. The
Company shall reimburse the Executive on a grossed up basis in the event that
any tax is assessed upon him in relation to such fees, dues and expenses.
(g) FINANCIAL PLANNING, ETC. During the Employment Period, the
Company shall provide the Executive with financial consulting services,
including taxrelated advice and services, without cost or expense to him and
shall reimburse the Executive on a grossed up basis in the event that any tax is
assessed upon him in relation to such services. The Company shall pay the
reasonable fees and disbursements of legal, accounting and tax advisors incurred
by the Executive in connection with the negotiation, preparation and
implementation of this Agreement and any additional instruments and agreements
related hereto, and any transactions contemplated hereby, and the Company shall
reimburse the Executive on a grossed up basis in the event that any tax is
assessed upon him in relation to any such fees and disbursements.
(h) OTHER BENEFITS. During the Employment Period, the
Executive shall be eligible to participate at no cost or expense to him in
welfare plans and programs (including any tax-deferred savings plan, group life
insurance plan, medical and dental insurance plan, and accident and disability
insurance plan) ("Benefit Plans") applicable generally to employees and/or
senior executives of the Company, but shall not be eligible to participate in
the Company's short-term or long-term incentive plans or in the Company's
employee defined benefit pension plans. The Company will waive, or obtain the
waiver of, any waiting periods for eligibility under
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the Benefit Plans or will provide comparable benefits to the Executive without
cost to him during the waiting period.
6. TERMINATION. The Executive's employment hereunder, as the case
may be, may be terminated as follows:
(a) DEATH. The Executive's employment shall terminate upon his
death, and the date of his death shall be the Date of Termination.
(b) DISABILITY. If, as a result of the Executive's incapacity due
to physical or mental illness, the Executive shall have been absent from his
duties hereunder on a full-time basis for one hundred and twenty (120)
consecutive days and, within thirty (30) days after written Notice of
Termination (as defined in Section 6(f) hereof) is given, shall not have
returned to the performance of his duties hereunder on a full-time basis
("Disability"), the Company may terminate the Executive's employment hereunder.
In this event, the Date of Termination shall be thirty (30) days after Notice of
Termination is given (provided that the Executive shall not have returned to the
performance of his duties on a full-time basis during such thirty (30) day
period).
(c) CAUSE. The Company may terminate the Executive's
employment hereunder for Cause. For purposes of this Agreement, the Company
shall have "Cause" to terminate the Executive's employment hereunder:
(i) upon the Executive's conviction for the commission of
a felony (or a plea of nolo contendere thereto); or
(ii) willful failure by the Executive substantially to
perform his duties hereunder (other than any such failure resulting from the
Executive's incapacity due to Disability).
For purposes hereof, no act or failure to act by the Executive
shall be considered "willful" unless done or omitted to be done by him not
in good faith or without reasonable belief that his action
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or omission was in the best interests of the Company or contrary to a
formal resolution of the Board. Cause shall not exist unless and until
there shall have been delivered to the Executive a copy of a resolution,
duly adopted by the affirmative vote of not less than two thirds of the
entire membership of the Board at a meeting of the Board held for the
purpose (after ten (10) days' prior notice to the Executive of such
meeting and the purpose thereof and an opportunity for him, together with
his counsel, to be heard before the Board at such meeting), finding that
in the good faith opinion of the Board, the Executive was guilty of
conduct set forth above in clause (ii) of this Section 6(c) and specifying
the particulars thereof in detail. The Date of Termination shall be the
date specified in the Notice of Termination; provided, however, that, in
the case of a termination for Cause under clause (ii) above, the Date of
Termination shall not be earlier than 30 days after delivery of the Notice
of Termination. Anything herein to the contrary notwithstanding, if,
following a termination of the Executive's employment by the Company for
Cause based upon the conviction of the Executive for a felony, such
conviction is overturned in a final determination on appeal, the Executive
shall be entitled to the payments and the economic equivalent of the
benefits the Executive would have received if his employment had been
terminated by the Company without Cause.
(d) GOOD REASON. The Executive may terminate his employment
hereunder for Good Reason, provided that the Executive shall have delivered a
Notice of Termination (as defined in Section 6(f) hereof) within ninety (90)
days after the occurrence of the event of Good Reason giving rise to such
termination. For purposes of this Agreement, "Good Reason" shall mean the
occurrence of one or more of the following circumstances, without the
Executive's express written consent, which are not remedied by the Company
within thirty (30) days of receipt of the Executive's Notice of Termination:
(i) an assignment to the Executive of any duties
materially inconsistent with his positions,
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duties, responsibilities and status with the Company or any material limitation
of the powers of the Executive not consistent with the powers of the Executive
contemplated by Section 3 hereof;
(ii) any removal of the Executive from, or any failure to
re-elect the Executive to, the positions specified in Section 3 of this
Agreement;
(iii) the change of the Executive's title as specified by
Section 3 of this Agreement;
(iv) the Company's requiring the Executive without his
consent to be based at any office or location other than as described in Section
4 of this Agreement;
(v) a reduction in the Executive's Base Salary as in
effect from time to time;
(vi) the failure of the Company to continue in effect any
Benefit Plan that was in effect on the date hereof or provide the Executive with
equivalent benefits;
(vii) the failure of the Company, within not more than
sixty (60) days after the Effective Date, to have the Executive duly elected as
a member of its Board of Directors and to maintain the Executive in such
position at all times thereafter for so long as he shall serve as Chief
Executive Officer of the Company;
(viii) the failure of the Company to cause three
individuals (or their successors) designated by the Executive to be elected and
reelected as directors of the Company in accordance with Section 3 hereof;
(ix) any other material breach by the Company of this
Agreement; or
(x) a Change in Control.
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In the event of a termination for Good Reason, the Date of
Termination shall be the date specified in the Notice of Termination, which
shall be no more than thirty (30) days after the Notice of Termination.
(e) OTHER TERMINATIONS. Notwithstanding the foregoing, the
Company may terminate the Executive's employment hereunder at any time and the
Executive may terminate his employment at any time, in each case subject to the
provisions of Sections 7(d) and (e) hereof. If the Executive's employment is
terminated hereunder for any reason other than as set forth in Sections 6(a)
through 6(d) hereof, the date on which a Notice of Termination is given or any
later date (within 30 days) set forth in such Notice of Termination shall be the
Date of Termination.
(f) NOTICE OF TERMINATION. Any termination of the Executive's
employment hereunder by the Company or by the Executive (other than termination
pursuant to Section 6(a) hereof) shall be communicated by written Notice of
Termination to the other party hereto in accordance with Section 13 hereof. For
purposes of this Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive's employment under the
provision so indicated. If any dispute concerning a Notice of Termination of the
Executive's employment under Section 6(b), 6(c) or 6(d) hereof results in a
determination that a proper basis for such termination did not exist under such
section, the Executive's employment under this Agreement shall be treated, with
respect to a Notice of Termination pursuant to Section 6(b) or 6(c) hereof, as
having been terminated pursuant to Section 6(e) hereof or, with respect to a
Notice of Termination pursuant to Section 6(d) hereof, as having not been
terminated.
7. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
(a) DISABILITY PERIOD. During any period
during the Employment Period that the Executive fails to
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perform his duties hereunder as a result of incapacity due to physical or mental
illness ("Disability Period"), the Executive shall continue to (i) receive his
full Base Salary and (ii) participate in the Benefit Plans. Such payments made
to the Executive during the Disability Period shall be reduced by the sum of the
amounts, if any, payable to the Executive at or prior to the time of any such
payment under disability benefit plans of the Company or under the Social
Security disability insurance program, and which amounts were not previously
applied to reduce any such payment.
(b) DEATH. If the Executive's employment hereunder is
terminated as a result of death, then:
(i) the Company shall pay the Executive's estate or
designated beneficiary, as soon as practicable after the Date of
Termination, any Base Salary installments due in the month of death and
any reimbursable expenses, accrued or owing the Executive hereunder as of
the Date of Termination;
(ii) the Options granted to the Executive pursuant to
the Option Award shall become vested and exercisable, as of the Date of
Termination, to the extent such Option Award would have otherwise become
vested on or before the first anniversary of the Date of Termination, and
all vested Options shall remain exercisable for a period of one year
following such Date of Termination and shall thereafter be completely
forfeited and cancelled; any Options that would not have become vested and
exercisable on or before the first anniversary of the Date of Termination
shall terminate and be forfeited as of the Date of Termination; and
(iii) the portion of the Restricted Shares that have not
vested as the Date of Termination equal to the number of such unvested
Restricted Shares multiplied by a fraction, the numerator of which is 24
minus the number of full months remaining in the first two years of the
Employment Period (disregarding the earlier termination thereof) after the
Date of Termination and denominator of
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which is 24, shall become vested as of the Date of Termination and the
restrictions imposed thereon shall lapse. The balance of such unvested
Restricted Shares shall be forfeited to the Company (without further
action on the part of the Company or the Executive) as of the Date of
Termination, and the Executive shall have no further rights with respect
to such balance.
(c) DISABILITY. If the Executive's employment hereunder is
terminated as a result of Disability, then:
(i) the Company shall pay the Executive, as soon as
practicable after the Date of Termination, any Base Salary and any
reimbursable expenses, accrued or owing the Executive hereunder for
services as of the Date of Termination;
(ii) the Options granted to the Executive pursuant to
the Option Award shall become vested and exercisable, as of the Date of
Termination, to the extent such Option Award would have otherwise become
vested on or before the first anniversary of the Date of Termination, and
all vested Options shall remain exercisable for a period of three years
following such Date of Termination and shall thereafter be completely
forfeited and cancelled; any Options that would not have become vested and
exercisable on or before the first anniversary of the Date of Termination
shall terminate and be forfeited as of the Date of Termination; and
(iii) the portion of the Restricted Shares that have not
vested as the Date of Termination equal to the number of such unvested
Restricted Shares multiplied by a fraction, the numerator of which is 24
minus the number of full months remaining in the first two years of the
Employment Period (disregarding the earlier termination thereof) after the
Date of Termination and denominator of which is 24, shall become vested,
and the restrictions imposed thereon shall lapse. The balance of such
unvested Restricted Shares shall be forfeited to the Company (without
further action on the part of the
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Company or the Executive) as of the Date of Termination, and the Executive
shall have no further rights with respect to such balance.
(d) CAUSE OR BY EXECUTIVE OTHER THAN FOR GOOD REASON. If the
Executive's employment hereunder is terminated by the Company for Cause or by
the Executive (other than for Good Reason), then:
(i) the Company shall pay the Executive, as soon as
practicable after the Date of Termination, any Base Salary and any
reimbursable expenses accrued or owing the Executive hereunder for
services as of the Date of Termination; and
(ii) the Executive shall immediately forfeit any
unvested Restricted Shares and any unvested portion of the Option Award.
In the event of termination by the Company for Cause, the Executive shall
have the right to exercise the vested unexercised portion of the Option
Award for a period of ninety (90) days after the Date of Termination, and
the unexercised portion of such Option Award shall be forfeited
thereafter. In the event of termination by the Executive other than for
Good Reason, the Executive shall have the right to exercise the vested
unexercised portion of the Option Award for a period of one year following
the Date of Termination and the unexercised portion of such Option Award
shall be forfeited thereafter.
(e) TERMINATION BY COMPANY WITHOUT CAUSE OR BY THE EXECUTIVE
WITH GOOD REASON. If the Executive's employment hereunder is terminated by the
Company (other than for Cause or Disability) or by the Executive for Good
Reason, then:
(i) the Company shall pay the Executive, as soon as
practicable after the Date of Termination, any Base Salary and any
reimbursable expenses, accrued or owing the Executive hereunder for
services as of the Date of Termination;
(ii) the Company shall immediately pay to the Executive
as liquidated damages and not
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<PAGE>
as a penalty a lump sum amount equal to the total Base Salary that would
have otherwise been payable to the Executive with respect to the period
commencing immediately following the Date of Termination and ending on
July 17, 1999, or, if applicable, the expiration of the Renewal Period
(the "Salary Continuation Period") at the annualized rate in effect at the
time Notice of Termination is given;
(iii) the Options granted to the Executive pursuant to
the Option Award shall become fully vested and exercisable, and the
Restricted Shares shall become fully vested, as of the Date of
Termination. The Option Award shall remain exercisable for the balance of
its original 10-year term; and
(iv) for a period of three years immediately following
the Date of Termination, the Executive shall continue to participate in
all employee benefit plans and programs in which the Executive was
entitled to participate immediately prior to the Date of Termination in
accordance with the terms of such plans and programs as in effect from
time to time; provided that the Executive's continued participation is
permitted under the general terms and provisions of such plans and
programs. In the event that the Executive's participation in any such plan
or program is barred, the Company shall arrange to provide the Executive
and his dependents with benefits substantially the same as those which the
Executive and his dependents would otherwise have been entitled to receive
under such plans and programs from which their continued participation is
barred or provide their economic equivalent.
8. GROSS-UP FOR EXCISE TAX. In the event that the Executive receives
any payment or benefit (including but not limited to the payments or benefits
pursuant to Section 7 of this Agreement) (a "Payment") that is subject to the
excise tax (the "Excise Tax") under Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), the Company shall pay to the Executive, as soon
thereafter as practicable, an additional amount (a
18
<PAGE>
"Gross-Up Payment") such that the net amount retained by the Executive, after
deduction of any Excise Tax imposed upon the Payment and any federal, state and
local income tax and Excise Tax imposed upon the Gross-Up Payment shall be equal
to the Payment. The determination of whether an Excise Tax is due in respect of
any payment or benefit, the amount of the Excise Tax and the amount of the
Gross-Up Payment shall be made by an independent auditor (the "Auditor") jointly
selected by the Company and the Executive and paid by the Company. If the
Executive and the Company cannot agree on the firm to serve as the Auditor, then
the Executive and the Company shall each select one nationally recognized
accounting firm and those two firms shall jointly select the nationally
recognized accounting firm to serve as the Auditor. Notwithstanding the
foregoing, for purposes of determining the Gross-Up Payment in respect of any
Payment, (i) any other payments or benefits received or to be received by the
Executive in connection with a Change in Control or the Executive's termination
of employment (whether pursuant to the terms of this Agreement or any other
plan, arrangement or agreement with the Company, any person whose actions result
in a Change in Control or any person affiliated with the Company or such person)
shall be treated as "parachute payments" within the meaning of Section
280G(b)(2) of the Code, and all "excess parachute payments" within the meaning
of Section 280G of the Code shall be treated as subject to the Excise Tax,
unless in the opinion of tax counsel selected by the Auditor, such other
payments or benefits (in whole or in part) do not constitute parachute payments,
or are otherwise not subject to the Excise Tax, and (ii) the Executive shall be
deemed to pay federal income tax at the highest marginal rate applicable in the
calendar year in which the Gross-Up Payment is made, and state and local income
taxes at the highest marginal rate of taxation in the state and locality of the
Executive's residence on the Date of Termination, net of the maximum reduction
in federal income taxes which could be obtained from deduction of such state and
local taxes. In the event the actual Excise Tax or such income tax is more or
less than the amount used to calculate the Gross-Up Payment, the Executive or
the Company, as the case may be, shall pay to the other an amount reflecting the
actual Excise Tax or such income tax, plus interest on the amount of such
19
<PAGE>
repayment at the rate provided in Section 1274(b)(2)(B) of the Code.
9. MITIGATION. The Executive shall not be required to mitigate
amounts payable pursuant to Section 7 hereof by seeking other employment or
otherwise, nor shall there be any offset against such payments on account of (a)
any remuneration attributable to any subsequent employment that he may obtain or
(b) any claims the Company may have against the Executive.
10.CONFIDENTIAL INFORMATION, REMOVAL OF DOCUMENTS, NON-COMPETITION.
(a) CONFIDENTIAL INFORMATION. The Executive shall hold in a
fiduciary capacity for the benefit of the Company and its subsidiaries (the
"Sunbeam Entities") all trade secrets, confidential information, and knowledge
or data relating to the Sunbeam Entities and the businesses and investments of
the Sunbeam Entities, which shall have been obtained by the Executive during the
Executive's employment by the Company, including such information with respect
to any products, improvements, formulas, designs or styles, processes, services,
customers, suppliers, marketing techniques, methods, future plans or operating
practices ("Confidential Information"); PROVIDED, HOWEVER, that Confidential
Information shall not include any information known generally to the public
(other than as a result of unauthorized disclosure by the Executive) or any
specific information or type of information generally not considered
confidential by persons engaged in the same business as the Company, or
information disclosed by the Company or any officer thereof to a third party
without restrictions on the disclosure of such information. Except as may be
required or appropriate in connection with his carrying out his duties under
this Agreement, the Executive shall not, without the prior written consent of
the Company or as may otherwise be required by law or legal process, communicate
or divulge any such Confidential Information to anyone other than the Company
and those designated by the Company.
(b) REMOVAL OF DOCUMENTS. All records, files, drawings,
documents, models, and the like relating
20
<PAGE>
to the business of the Sunbeam Entities, which the Executive prepares, uses or
comes into contact with and which contain Confidential Information shall not be
removed by the Executive from the premises of any Sunbeam Entity (without the
written consent of the Company) during or after the Employment Period unless
such removal shall be required or appropriate in connection with his carrying
out his duties under this Agreement, and, if so removed by the Executive, shall
be returned to such Sunbeam Entity immediately upon termination of the
Executive's employment hereunder.
(c) NON-COMPETITION. During (i) the Executive's employment
with the Company and (ii) the two (2) year period immediately following the
Executive's Date of Termination, the Executive (A) shall not engage, anywhere
within the geographical areas in which any Sunbeam Entity is then conducting its
business operations, directly or indirectly, alone, in association with or as a
shareholder, principal, agent, partner, officer, director, employee or
consultant of any other organization, in any business (a "Competitive Business")
which competes with any business then being conducted by such Sunbeam Entity;
(B) shall not solicit or encourage any officer, employee or consultant of any of
the Sunbeam Entities to leave the employ of any of the Sunbeam Entities for
employment by or with any Competitive Business; and (C) shall not solicit,
divert or take away, or attempt to divert or to take away, the business or
patronage of any of the customers or accounts, or prospective customers or
accounts, of any Sunbeam Entity, which were contacted, solicited or served by
the Executive while employed by the Company; provided, however, that nothing
herein shall prohibit the Executive from owning a maximum of two percent (2%) of
the outstanding stock of any publicly traded corporation. Following the Date of
Termination, ownership by the Executive of not more than five percent (5%) of
any publicly traded corporation shall not constitute a violation hereof. If, at
any time, the provisions of this Section 10(c) shall be determined to be invalid
or unenforceable, by reason of being vague or unreasonable as to area, duration
or scope of activity, this Section 10(c) shall be considered divisible and shall
become and be immediately amended to only such area, duration and scope of
activity as shall
21
<PAGE>
be determined to be reasonable and enforceable by the court or other body having
jurisdiction over the matter; and the Executive agrees that this Section 10(c)
as so amended shall be valid and binding as though any invalid or unenforceable
provision had not been included herein. For purposes of this Section 10(c), the
design, manufacture and marketing of outdoor barbecue grills, casual outdoor and
indoor furniture and small kitchen appliances shall be construed to be a
Competitive Business; provided, however, that the gross revenues derived from
sales of such products by such competitor are greater than the lesser of (i) 10%
of its total revenues and (ii) $500,000,000.
(d) REMEDIES. In the event of a breach or threatened breach of
this Section 10, the Executive agrees that the Company shall be entitled to
apply for injunctive relief in a court of appropriate jurisdiction to remedy any
such breach or threatened breach, the Executive acknowledging that damages would
be inadequate and insufficient.
(e) CONTINUING OPERATION. Any termination of the Executive's
employment or of this Agreement shall have no effect on the continuing
operation of this Section 10.
11. INDEMNIFICATION. The Company shall indemnify the Executive to
the full extent permitted by law and the By-laws of the Company for all
expenses, costs, liabilities and legal fees which the Executive may incur in the
discharge of all his duties hereunder, including, without limitation, the right
to be paid in advance by the Company for his expenses in defending a civil or
criminal action, proceeding or investigation prior to the final disposition
thereof. The Executive shall be insured under the Company's Directors' and
Officers' Liability Insurance Policy as in effect from time to time.
Notwithstanding any other provision of this Agreement to the contrary, any
termination of the Executive's employment or of this Agreement shall have no
effect on the continuing operation of this Section 11.
12. SUCCESSORS; BINDING AGREEMENT.
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<PAGE>
(a) COMPANY'S SUCCESSORS. No rights or obligations of the
Company under this Agreement may be assigned or transferred by the Company
except that such rights or obligations may be assigned or transferred pursuant
to a merger or consolidation in which the Company is not the continuing entity,
or the sale or liquidation of all or substantially all of the business and/or
assets of the Company, provided that the assignee or transferee is the successor
to all or substantially all of the business and/or assets of the Company and
such assignee or transferee assumes the liabilities, obligations and duties of
the Company, as contained in this Agreement, either contractually or as a matter
of law. The Company will require any such successor to expressly assume and
agree to perform this Agreement in the same manner and to the same extent that
the Company would be required to perform it if no such succession had taken
place. As used in this Agreement (except in the definition of Change in
Control), "Company" shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid which executes and delivers
the agreement provided for in this Section 12 or which otherwise becomes bound
by all the terms and provisions of this Agreement or by operation of law.
(b) EXECUTIVE'S SUCCESSORS. This Agreement shall not be
assignable by the Executive. This Agreement and all rights of the Executive
hereunder shall inure to the benefit of and be enforceable by the Executive's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. Upon the Executive's death, all amounts to
which he is entitled hereunder, unless otherwise provided herein, shall be paid
in accordance with the terms of this Agreement to the Executive's devisee,
legatee, or other designee or, if there be no such designee, to the Executive's
estate.
13. NOTICE. For the purposes of this Agreement, notices, demands and
all other communications provided for in this Agreement shall be in writing and
shall be deemed to have been duly given when delivered or (unless otherwise
specified) mailed by United States certified or registered mail, return receipt
requested, postage prepaid, addressed as follows:
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<PAGE>
If to the Executive:
Albert J. Dunlap
422 Addison Park Lane
Boca Raton, Florida 33432
(With a copy to:
Reboul, MacMurray, Hewitt, Maynard
& Kristol
45 Rockefeller Plaza
New York, New York 10111
Attn: Howard G. Kristol, Esq.)
If to the Company:
Sunbeam Corporation
2100 New River Center
200 East Las Olas Boulevard
Fort Lauderdale, Florida 33301
Attn: Chairman of the Compensation
Committee
(With a copy to:
Skadden, Arps, Slate, Meagher & Flom
One Rodney Square
Wilmington, Delaware 19801
Attn: Richard L. Easton, Esq.)
or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
14. MISCELLANEOUS. No provisions of this Agreement may be modified
unless such modification is agreed to in writing signed by the Executive and an
authorized officer of the Company. Any waiver or discharge must be in writing
and signed by the Executive or such an authorized officer of the Company, as the
case may be. No waiver by either party hereto at any time of any breach by the
other party hereto of, or compliance with, any condition or provision of this
Agreement to be
24
<PAGE>
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of Delaware without regard to its conflicts
of law principles.
15. WITHHOLDING. Any payments provided for in this Agreement
shall be paid net of any applicable withholding of taxes required under federal,
state or local law.
16. ARBITRATION. Except as otherwise provided herein, all
controversies, claims or disputes arising out of or related to this Agreement
shall be settled under the rules of the American Arbitration Association then in
effect in the State of Florida, as the sole and exclusive remedy of either
party, and judgment upon such award rendered by the arbitrator(s) may be entered
in any court of competent jurisdiction. The costs of the arbitration shall be
borne as determined by the arbitrators PROVIDED, HOWEVER, that if the Company's
position is not substantially upheld, as determined by the arbitrators, the
expenses of the Executive (including, without limitation, fees and expenses
payable to the AAA and the arbitrators, fees and expenses payable to witnesses,
including expert witnesses, fees and expenses payable to attorneys and other
professionals, expenses of the Executive in attending the hearings, costs in
connection with obtaining and presenting evidence and costs of transcription of
the proceedings), as determined by the arbitrators, shall be reimbursed to him
by the Company.
17. VALIDITY. The invalidity or unenforceability of any provision
or provisions of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement, which shall remain in full force and
effect.
18. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
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<PAGE>
19. ENTIRE AGREEMENT. This Agreement between the Company and the
Executive sets forth the entire agreement of the parties hereto in respect of
the subject matter contained herein and supersedes all prior agreements,
promises, covenants, arrangements, communications, representations or
warranties, whether oral or written, by the parties hereto in respect of the
subject matter contained herein; and any prior agreement of the parties hereto
in respect of the subject matter contained herein is hereby terminated and
cancelled.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on July 18, 1996 to be effective as of the Effective Date.
SUNBEAM CORPORATION
By:/s/ Peter A. Langerman
------------------------------------
Name: Peter A. Langerman
Title: Chairman of the Executive
Committee
/s/ Albert J. Dunlap
------------------------------------
Albert J. Dunlap
26
EXHIBIT 10.B
AMENDED AND RESTATED
SUNBEAM CORPORATION
EQUITY TEAM PLAN
(Amended and Restated as of May 15, 1996)
1. PURPOSE.
The purpose of the Sunbeam Corporation Equity Team Plan is to provide
incentives for selected executives, key employees, Outside Directors
and Designated Others to promote the financial success and progress of
Sunbeam Corporation. Capitalized terms used throughout this Plan shall
have the meanings ascribed to them in Section 16 hereof.
2. STOCK SUBJECT TO THE PLAN.
(a) Subject to the provisions of this Section and Section 9, the
maximum number of shares of Stock that may be issued under the
Plan is 11,500,000 shares, to be allocated as follows:
(i) 11,300,000 shares may be issued in connection with
the grant of Options pursuant to Section 3; and
(ii) 200,000 shares may be issued in connection with the
grant of Restricted Stock Awards pursuant to Section
3.
Such shares may be either authorized but unissued shares or
treasury shares.
(b) The number of shares subject to an Option or a Restricted
Stock Award that has been granted under the Plan shall no
longer be charged against the limitation provided in Section
2(a), and may again be made subject to Options or Restricted
Stock Awards, as the case may be, to the extent that Options
expire unexercised or are terminated, surrendered or canceled
before exercise or Restricted Stock Awards are forfeited,
terminated, surrendered or canceled due to a Participant's
termination of employment or service as an Outside Director or
for any other reason.
3. GRANTS OF OPTIONS AND RESTRICTED STOCK AWARDS.
(a) Subject to the provisions of the Plan, the Committee may at
any time, or from time to time, grant Options to officers, key
employees, Outside Directors of the Company (or its
subsidiaries) and Designated Others.
(b) Subject to the provisions of the Plan, the Committee may at
any time, or from time to time, grant shares of Stock which
are subject to the Restrictions set forth in Section 4(b)
("Restricted Stock") to officers, key employees and Outside
Directors of the Company (or its subsidiaries) and Designated
Others.
(c) The Committee shall cause 5,000 shares of Restricted Stock to
be issued immediately and automatically upon the initial
election or appointment of each Outside Director of the
Company. The provisions of this Section 3(c) shall not be
amended more often than once in any six (6) month period,
other than to comport with changes in the Code, ERISA or the
rules thereunder.
(d) The Committee shall cause Options to be granted annually for
the purchase of 1,000 shares of Stock to each Outside
Director, which Options shall be granted immediately and
automatically as
<PAGE>
of the date of the election of such director. The provisions
of this Section 3(d) shall not be amended more often than once
in any six (6) month period, other than to comport with
changes in the Code, ERISA or the rules thereunder.
(e) Each Option shall be evidenced by a Stock Option Agreement,
and each Restricted Stock Award shall be evidenced by a
Restricted Stock Award Agreement, each in a form approved by
the Committee or by a Company officer designated by the
Committee.
(f) Notwithstanding any other provision of the Plan, no person
shall be granted Options for more than 250,000 shares of Stock
or Restricted Stock Awards for more than 25,000 shares of
Stock in any single fiscal year of the Company.
4. TERMS AND CONDITIONS.
(a) OPTIONS.
(i) An Option shall entitle the Participant who holds it
to exercise the Option on and subject to the terms,
conditions and restrictions of the Plan (as the Plan
may be amended from time to time) and such additional
terms, conditions and restrictions as may be imposed
by the Committee at the time of grant.
(ii) Unless otherwise specified by the Committee, the
term of each Option granted prior to May 15, 1996
(herein the "1996 Amendment Date") and which is
In-the-Money as of the 1996 Amendment Date shall
commence on the date of grant of the Option and shall
expire at the close of business on the earlier of (A)
the tenth anniversary of the date of grant or (B) the
45th day following the termination of the
Participant's employment with, or service as director
of, the Company (or a subsidiary). Unless otherwise
specified by the Committee, the term of each Option
granted on or after the 1996 Amendment Date and the
term of each Option granted prior to the 1996
Amendment Date which is Out- of-the- Money as of the
1996 Amendment Date, shall commence on the Grant Date
of the Option and shall expire at the close of
business on the earliest of (A) the tenth anniversary
of the Grant Date; or (B) the third anniversary of
the date of termination of the Participant's
employment with, or service as a director of, the
Company (or a subsidiary), in the case of retirement
or termination by the Company without Cause; or (C)
90 days after the date of termination of employment
in the case of resignation, voluntary departure or
termination by the Company with Cause; or (D) in the
case of a Designated Other, the date specified in the
Stock Option Agreement. Notwithstanding the foregoing
sentence, Participants who are subject to Section
16(b) of the Exchange Act shall have until the
earlier of (A) the tenth anniversary of the Grant
Date; or (B) the third anniversary of the date of
termination of their employment with, or service as a
director of the Company, regardless of the cause,
within which to exercise Options which are granted on
or after the 1996 Amendment Date and Options which
are Out-of-the-Money as of the 1996 Amendment Date;
provided, however, that no such Option may be
exercised by any such person during the period
beginning on the date of termination and ending on
the six month anniversary of the date of termination.
(iii) Options granted to Outside Directors pursuant to
Section 3(d) shall become exercisable
2
<PAGE>
with respect to all of the shares subject to the
Option on the Grant Date. Unless otherwise specified
by the Committee (which is empowered to provide
different vesting schedules with respect to any grant
of Options or Restricted Stock), all other Options
granted under the Plan shall become exercisable with
respect to 20% of the shares subject to the Option
beginning on the first anniversary of the Grant Date
and as to an additional 20% on each of the second,
third, fourth and fifth anniversaries of the Grant
Date (each twelve month period ending on an
anniversary of a Grant Date being referred to herein
as an "Option Year"), provided in each case that the
Participant shall have remained an employee or a
director of the Company (or a subsidiary), or in the
case of a Designated Other, shall have remained in
the position set forth in the Stock Option Agreement,
continuously since the Grant Date. Notwithstanding
the foregoing, during the remaining term of any
options (if not already so exercisable) : (A) if a
Participant's employment or service as a director, or
in the case of a Designated Other, the period of
service as defined in the Stock Option Agreement,
terminates due to death, all Options held by the
Participant at death shall become immediately
exercisable in full; (B) upon a Change in Control,
coupled with a Change in Status of a Participant, all
Options held by such Participant who is then an
employee or director of the Company (or a subsidiary)
shall become immediately exercisable in full; (C) in
the event that the exercisability of an Option
accelerates due to a Change in Control and a Change
in Status, Participants who are subject to Section
16(b) of the Exchange Act may not sell the shares
acquired upon such accelerated exercise within six
months of the Grant Date of such Option; and (D) upon
the termination during an Option Year of employment
of an officer of the Company elected by the Board,
the portion of shares subject to any Option held by
such officer which was scheduled to become
exercisable on the next anniversary of the Grant Date
immediately following such termination (the "Next
Option Increment") shall be prorated on the basis of
the number of full calendar months worked in such
Option Year to permit partial exercisability of the
Next Option Increment.
(iv) Except to the extent permitted by Rule 16b-3 or
its successor, Options shall not be sold, assigned,
transferred, pledged, hypothecated, or otherwise
disposed of, except by will or the laws of descent
and distribution, pursuant to a qualified domestic
relations order ("QDRO") as defined in the Code or
ERISA (or the rules thereunder) or as otherwise set
forth in this Section 4(a)(iv). Each Option shall be
exercisable during the lifetime of a Participant only
by the Participant to whom it was granted, and after
the Participant's death only by the Participant's
estate or legal representative. To the extent
exercisable, an Option may be exercised in whole at
any time, or in part from time to time, during the
term of the Option.
(v) Any Option may be converted, modified, forfeited or
canceled, prospectively or retroactively, in whole or
in part, by the Committee in its sole discretion;
provided, however, that no such action shall
adversely affect the rights of any Participant under
any Option granted prior to such action without his
consent. Except as may be otherwise provided in an
Agreement, the Committee may, in its sole discretion,
in whole or in part, waive any restrictions or
conditions applicable to, or accelerate the vesting
of, any Option.
(b) STOCK AWARDS.
(i) Upon the grant of a Restricted Stock Award, a stock
certificate representing a number of
3
<PAGE>
shares of Stock equal to the number of shares of
Restricted Stock granted to a Participant shall be
registered in the Participant's name but shall be
held in custody by the Company for the Participant's
account. The Participant shall generally have the
rights and privileges of a stockholder as to such
Restricted Stock, including the right to vote such
Restricted Stock, except that the following
restrictions (the "Restrictions") shall apply: (A)
the Participant shall not be entitled to delivery of
the certificate until the Restricted Period (set
forth in paragraph (iii) below) applicable to such
Restricted Stock has expired or terminated and until
any other conditions prescribed by the Committee are
satisfied; (B) none of the Restricted Stock may be
sold, transferred, assigned, pledged, or otherwise
encumbered or disposed of during the Restricted
Period applicable to such Restricted Stock and prior
to the satisfaction of any other conditions
prescribed by the Committee; and (C) shares of
Restricted Stock shall be forfeited and all rights of
the Participant to such Restricted Stock shall
terminate without further obligation on the part of
the Company unless the Participant has (1) remained
an employee or a director of the Company (or a
subsidiary) until the expiration or termination of
the Restricted Period applicable to such Restricted
Stock (or in the case of a Designated Other, the
duration specified in the Restricted Stock Award
Agreement) and (2) satisfied any other conditions
prescribed by the Committee applicable to such
Restricted Stock. At the discretion of the Committee,
cash and stock dividends with respect to the
Restricted Stock may be either currently paid or
withheld by the Company for the Participant's
account. Cash dividends so withheld by the Committee
shall not be subject to forfeiture. Upon the
forfeiture of any shares of Restricted Stock, such
forfeited Restricted Stock shall be transferred to
the Company without further action by the
Participant. The Participant shall have the same
rights and privileges, and be subject to the
Restrictions, with respect to any shares or other
property received pursuant to Section 9.
(ii) Upon the expiration or termination of the
Restricted Period with respect to shares of
Restricted Stock and the satisfaction of any other
conditions prescribed by the Committee, the
Restrictions applicable to such Restricted Stock
shall lapse and a stock certificate for the number of
shares of Stock with respect to which the Restricted
Period has lapsed shall be delivered, free of all
restrictions, except any that may be imposed by law,
to the Participant or the Participant's beneficiary
or estate, as the case may be. The Company shall not
be required to deliver any fractional share of Stock
but will pay, in lieu thereof, the Fair Market Value
(determined as of the date the Restricted Period
expires or terminates) of such fractional share to
the Participant or the Participant's beneficiary or
estate, as the case may be. No payment will be
required from the Participant upon the issuance or
delivery of any shares of Stock under this paragraph,
except that any amount necessary to satisfy
applicable federal, state or local tax requirements
shall be withheld or paid promptly upon notification
of the amount due and prior to or concurrently with
the issuance or delivery of a certificate
representing such shares.
(iii) The Restrictions shall lapse with respect to
one-fifth of the Restricted Stock subject to a
Restricted Stock Award made to an Outside Director
pursuant to Section 3(c) hereof on each of the first
through the fifth anniversaries of the Grant Date on
which the Outside Director remains a director of the
Company. Unless otherwise specified by the Committee
at the time of the award and included in the
Restricted Stock Award Agreement, the Restrictions
shall also lapse with respect to one-fifth of the
Restricted Stock subject to all other Restricted
Stock Awards on each of the first through the fifth
4
<PAGE>
anniversaries of the Grant Date, provided in each
case that the Participant shall have remained an
employee or a director of the Company (or a
subsidiary) continuously since the date of grant (or
in the case of a Designated Other, shall have
complied with the terms and conditions of the
Restricted Stock Award Agreement). Notwithstanding
the foregoing: (A) if a Participant's employment or
service as a director, or in the case of a Designated
Other, the period defined in the Restricted Stock
Award Agreement, terminates due to death, the
Restrictions shall lapse with respect to all
Restricted Stock Awards held by the Participant at
death (if not already so lapsed); (B) upon a Change
in Control, coupled with a Change in Status of a
Participant, the Restrictions shall lapse with
respect to all Restricted Stock Awards held by such
Participant who is an employee or director of the
Company (or a subsidiary) (if not already so lapsed);
and (C) in the event of an accelerated lapse of
Restrictions due to a Change in Control and a Change
in Status, Participants who are subject to Section
16(b) of the Exchange Act may not sell the shares of
Stock whose Restrictions have so lapsed within six
months of the Grant Date of the Restricted Stock
Award pursuant to which such Stock was received. The
"Restricted Period" as to any shares constituting
part of a Restricted Stock Award shall be the period
of time commencing with the Grant Date of a
Restricted Stock Award and ending with the date on
which the Restrictions lapse with respect to any such
shares, or any portion thereof.
(c) In the event that the acceleration of (i) the exercisability
of an Option or (ii) the lapse of Restrictions relating to
Restricted Stock upon a Change in Control and a Change in
Status results in excise tax pursuant to Section 4999 of the
Code, or any successor or similar provision thereto, or
comparable state or local tax laws, the Company shall pay to
the Participant such additional compensation as is necessary
(after taking into account all Federal, state and local income
and excise taxes payable by the Participant as result of the
receipt of such compensation ) to place the Participant in the
same after-tax position he would have been in had no such
excise tax (or any interest or penalties thereon) been paid or
incurred. The amount of such payment shall be determined by
the independent accounting firm serving as the Company's
outside auditor immediately prior to the Change in Control.
5. EXERCISE OF OPTIONS.
(a) The Exercise Price of the shares purchasable under an Option
shall be the Fair Market Value per share on the Grant Date of
such Option, subject to subsequent adjustment pursuant to the
provisions of Section 9.
(b) Options shall be considered exercised (herein the "Exercise
Date") on the date written notice, in such form as the
Committee may prescribe, is received by the Option Plan
Administrator of the Company, advising of the exercise of an
Option and either transmitting payment of the total Exercise
Price for the number of shares of Stock involved or electing
one of the alternative payment procedures set forth in Section
5(c) below.
(c) The Exercise Price shall be paid in cash (including cash
obtained through a margin loan on the shares as to which the
Option is being exercised) or (and provided (x) the use of the
following procedure by a Participant would comply with
safeguards established by the Committee designed to avoid
"short-swing" profits to the Participant under Section 16(b)
of the Exchange Act, and (y) does not otherwise violate any
applicable laws) through (i) a broker-assisted cashless
exercise
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program established by the Committee, based on the actual
proceeds from the sale of share of Stock; or (ii) in shares of
Stock, valued on the basis of the closing market price of the
Stock on the Exercise Date.
(b) Subject to the provisions of Section 6 and the other
provisions of the Plan, the Stock Option Agreement and the
Option, the Company shall issue shares of Stock in the
Participant's name as soon as practicable (but in no event
later than 30 days) after the Exercise Date. The Participant
shall not be deemed to be a holder of any shares pursuant to
an Option, and shall not have any rights as a stockholder in
connection with such shares, until the date of transfer of
shares of Stock to the Participant. The Company shall have no
liability of any nature whatsoever to any Participant by
reason of any change in the market price of the Stock during
the period of time between the Exercise Date and the date on
which any shares of Stock resulting from the exercise are
issued or sold.
6. RESTRICTIONS.
(a) Notwithstanding any other provision of the Plan, an Option or
Restricted Stock Award to the contrary, no Option shall be
exercised, and the Company shall not be obligated to issue or
transfer shares of Stock under any Option or Restricted Stock
Award, until the Company shall have received such assurances
as the Company may reasonably request from its counsel that
the exercise of the Option and the issuance and transfer of
shares pursuant to the Option or Restricted Stock Award will
not violate the Securities Act of 1933, as amended, or any
other applicable Federal or state laws. In connection with any
such issuance or transfer, the Participant shall, if requested
by the Company, give assurances satisfactory to counsel to the
Company, in respect of the Participant's investment intent or
such other matters as counsel to the Company may deem
necessary or desirable to assure compliance with all
applicable legal requirements.
(b) No provisions of the Plan or any Option or Restricted Stock
Award shall be interpreted or construed to obligate the
Company to register any Stock under Federal or state law.
(c) The Company and the Committee reserve the right to investigate
at any time the circumstances surrounding any exercise of
Options, including any investigation regarding whether a
Participant is in compliance with the provisions of Section 13
hereof (or has threatened or is reasonably believed to intend
to violate the provisions of Section 13 hereof), and the
Company and the Committee shall have no liability or
responsibility to any Participant for any alleged damage
sustained by the Participant by reason of any delay in the
implementation of an Option exercise during the pendency of
any such investigation, whether by reason of any change in the
market price of the Stock or otherwise.
(d) Notwithstanding any other provision hereof, the Committee
shall have the right at any time to deny or delay a
Participant's exercise Options if such Participant is
reasonably believed by the Committee (i) to be engaged in
material conduct adversely affecting the Company or (ii) to be
contemplating such conduct, unless and until the Committee
shall have received reasonable assurance that the Participant
is not engaged in, and is not contemplating, such material
conduct adverse to the interests of the Company.
(e) Participants are and at all times shall remain subject to the
trading window policies adopted by the Company from time to
time throughout the period of time during which they may
exercise Options
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or sell Restricted Stock granted pursuant to the Plan.
Participants may request at any time a copy of any calendar of
scheduled open windows by contacting the Option Plan
Administrator.
7. FAIR MARKET VALUE.
(a) During any period that the Company's Stock is Actively Traded,
Fair Market Value shall equal the arithmetic average of the
closing prices of a share of Stock on the exchange or national
market system on which the Stock is traded, for the last
twenty market trading days prior to the date of determination
of Fair Market Value, or pursuant to such other method as the
Committee may reasonably specify for determining the Stock's
Fair Market Value.
(b) During any period during which the Company's Stock is not
Actively Traded, Fair Market Value shall be determined by the
Committee.
8. TERM.
This Amended and Restated Plan shall be effective as of the date set
forth on the first page hereof. No Option or Restricted Stock Award
shall be granted under the Plan after February 12, 2006, but the Plan
shall continue in effect thereafter with respect to any previously
granted Options and Restricted Stock Awards that remain outstanding and
the duration of any such grant or award shall not be affected by the
expiration of the Plan.
9. ADJUSTMENTS.
In the event that any recapitalization, or reclassification, split-up
or consolidation of shares of Stock shall be effected, or the
outstanding shares of Stock shall, in connection with a merger or
consolidation of the Company or a transaction or series of related
transactions that results in the sale of all or substantially all of
the Company's assets, be exchanged for a different number or class of
shares of stock or other securities or property of the Company or any
other Person, or a record date or dates for determination of holders of
Stock entitled to receive a dividend payable in stock or a liquidating
dividend (or series of dividends) shall occur, equitable and
proportional adjustments aimed at preventing the inequitable
enlargement or dilution of any rights hereunder shall be made to (i)
the number and class of shares or other securities or property that may
be issued or transferred pursuant to the Plan and any outstanding
Options and Restricted Stock Awards and (ii) the Exercise Price to be
paid per share under any outstanding Options; PROVIDED, HOWEVER, that
in the event of a merger or consolidation of the Company, or similar
transaction pursuant to which the outstanding Stock is exchanged for
cash or other property, the unexercised Options shall thereafter be
exercisable for, and the Restricted Stock Awards shall entitle the
Participant to receive, the cash or other property which an Option or
Restricted Stock Award holder, as the case may be, would have been
entitled to receive had the Options been exercised, or the Restrictions
relating to the Restricted Stock Award lapsed, immediately prior to the
record date for such merger, consolidation or similar transaction
except to the extent that provision is made in writing in connection
with such transaction for (1) the assumption of the Options by, or the
substitution for the Options of new options covering the stock of, a
successor acquiring corporation, in each case providing terms no less
favorable to the holder of such Options than would an assumption or
substitution described in Treasury Regulation ss.1.425-1(a) that would
not constitute a "modification" for purposes of Code ss.424(a), and (2)
the substitution for Restricted Stock Awards of stock of a successor or
acquiring corporation having terms no less favorable to the holder
thereof than the terms of the Restricted Stock Award in effect before
such transaction.
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10. ADMINISTRATION.
(a) The Plan shall be administered by the Committee. The Committee
shall, subject to the provisions of the Plan, have full power
and authority to administer the Plan, to select the
Participants in the Plan, and, except for grants and awards
which are automatically made to Outside Directors as provided
pursuant to Section 3 of the Plan, to determine the number of
shares to be made subject to each Option and Restricted Stock
Award and all terms and conditions of each Option and
Restricted Stock Award. The Committee shall have the power to
interpret the Plan and to adopt such rules for the
administration, interpretation and application of the Plan as
are consistent therewith and to interpret, amend or revoke any
such rules. All actions taken and all interpretations and
determinations made by the Committee shall be final and
binding upon all Participants, the Company and all other
interested persons, absent a determination by a court of
competent jurisdiction that the Committee has acted in bad
faith or has engaged in reckless or willful misconduct.
(b) Members of the Committee and the Board and officers
administering this Plan shall be fully protected in taking
actions under the Plan or in relying upon the advice of
counsel and shall incur no liability except for bad faith,
recklessness or willful misconduct in the performance of their
duties.
(c) Except as required by Rule 16b-3 with respect to grants of
Options to individuals who are subject to Section 16 of the
Exchange Act, or as otherwise required for compliance with
Rule 16b-3 or other applicable law, the Committee may delegate
all or any part of its authority under the Plan to an
employee, employees or committee of employees.
(d) To the extent the Committee deems it necessary, appropriate or
desirable to comply with foreign law or practices and to
further the purpose of the Plan, the Committee may, without
amending this Plan, establish special rules applicable to
Options granted to Participants who are foreign nationals, are
employed outside the United States, or both, including rules
that differ from those set forth in the Plan, and grant
Options to such Participants in accordance with those rules.
(e) Determinations by the Committee under the Plan relating to the
form, amount and terms and conditions of grants and awards
need not be uniform, and may be made selectively among persons
who receive or are eligible to receive grants and awards under
the Plan, whether or not such persons are similarly situated.
11. GENERAL PROVISIONS.
(a) Nothing in this Plan or in any instrument executed pursuant
hereto shall confer upon any Person any right to continue in
the employment or other service of the Company (or any
subsidiary), or shall affect the right of the Company (or any
subsidiary) to terminate the employment or other service of
any person at any time with or without Cause.
(b) The Company may make appropriate provisions for the
withholding of any taxes which the Company determines it is
required to withhold in connection with any Option or
Restricted Stock Award including, at the request of a
Participant and provided that it does not violate any
applicable laws, the payment of such withholding taxes through
a broker-assisted sale of a sufficient number of shares
underlying the Option or subject to the Restricted Stock Award
or by delivery to the
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Company of shares of Stock previously owned by the
Participant, in either case having an actual sale price equal
to the amount of such taxes. Notwithstanding the foregoing, a
Participant whose transactions in Stock are subject to Section
16(b) of the Exchange Act may make a share withholding
election only if it complies with safeguards established by
the Committee designed to avoid "short swing" profits to the
Participant under Section 16(b) of the Exchange Act.
(c) By accepting any benefits under the Plan, each Participant,
and each Person claiming under or through the Participant,
shall be conclusively deemed to have indicated acceptance and
ratification of, and consent to, all provisions of the Plan.
Each Participant hereby further agrees that amendments and
modifications to the Plan, which may be adopted from time to
time by the Committee and/or the Board of the Corporation (as
set forth in Section 12 hereof), shall be binding upon such
Participant and upon all Options or Restricted Stock which the
Participant may hold, including (with retroactive effect)
Options or Restricted Stock previously granted to the
Participant, except to the extent set forth in Section 12
hereof.
(d) With respect to Participants subject to Section 16 of the
Exchange Act, transactions under the Plan are intended to
comply with all applicable provisions of Rule 16b-3 or its
successor. To the extent any provision the Plan or action by
the Plan administrators fails to so comply, it shall be deemed
null and void, to the extent permitted by law and deemed
advisable by the Committee.
(e) A Participant shall have no rights as a stockholder of the
Company with respect to any Shares to be issued upon exercise
of an Option until such Participant has exercised such Option
and becomes a holder of such Shares.
12. AMENDMENTS; MODIFICATION AND TERMINATION.
This Plan may be amended or modified by the Committee, with
ratification by the Board, or terminated by the Board, at any time and
in any respect, except that no amendment shall be made without the
approval of the shareholders of the Company if shareholder approval
would be required by Rule 16b-3 under the Exchange Act or any other law
or rule of any governmental authority, stock exchange or other
self-regulatory organization to which the Company is subject. No such
amendment, modification or termination shall have effect to reduce the
number of shares as to which any Option or Restricted Stock Award
previously has been granted to a Participant; to extend the vesting
schedule with respect to any Option or Restricted Stock Award or to
extend the period of non-competition or confidentiality as set forth in
Section 13 hereof. In the event of the passage of any law, rule or
regulation or a determination by any regulatory agency or court,
requiring an adverse change in the Company's accounting or tax
treatment relating to the Plan, the Committee shall have the right to
modify the terms of outstanding Options and Restricted Stock Awards to
the extent necessary to avoid the adverse consequences of such change.
13. CONFIDENTIALITY AND NON-COMPETITION; CONDUCT NOT IN THE INTEREST OF THE
CORPORATION.
By accepting Options or Restricted Stock Awards under the Plan and as a
condition to the exercise of Options and the enjoyment of any of the
benefits of the Plan, each Participant agrees as follows:
(a) CONFIDENTIALITY -- During the period of each Participant's
employment or service as a director with the Company (or the
Participant's engaging in any other activity with or for the
Company) and for a two year period thereafter, each
Participant shall treat and safeguard as confidential and
secret
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all Confidential Information received by such Participant at
any time. Without the prior written consent of the Company,
except as required by law, such Participant will not disclose
or reveal any Confidential Information to any third party
whatsoever or use the same in any manner except in connection
with the businesses of the Company and its subsidiaries. In
the event that a Participant is requested or required (by oral
questions, interrogatories, requests for information or
documents, subpoena, civil investigative demand or other
process) to disclose (i) any Confidential Information or (ii)
any information relating to his opinion, judgment or
recommendations concerning the Company or its subsidiaries as
developed from the Confidential Information, Participant will
provide the Company with prompt written notice of any such
request or requirement so that the Company may seek an
appropriate protective order or waive compliance with the
provisions contained herein. If, failing the entry of a
protective order or the receipt of a waiver hereunder,
Participant is, in the reasonable opinion of his counsel,
compelled to disclose Confidential Information, Participant
shall disclose only that portion of the Confidential
Information which his counsel advises that he is compelled to
disclose and will exercise best efforts to obtain assurances
that confidential treatment will be accorded such Confidential
Information.
(b) NON-COMPETITION -- During the period of employment with the
Company or its subsidiaries of any Participant (other than a
director) compensated at a rate (including bonuses) in excess
of $75,000 per year in cash compensation from his employment
with the Company or any of its subsidiaries (determined as of
the most recently completed fiscal year of the Company), and,
for a two-year period thereafter (the "Non-Compete Period"),
each such Participant shall not, without prior written consent
of the Committee, do, directly or indirectly, any of the
following:
(1) own, manage, control or participate in the ownership,
management, or control of, or be employed or engaged
by or otherwise affiliated or associated with, any
other corporation, partnership, proprietorship, firm,
association or other business entity, or otherwise
engage in any business which competes with the
business of the Company or any of its subsidiaries
(as such business is conducted during the term of
such Participant's employment with the Company or its
subsidiaries) in the geographical regions in which
such business is conducted; PROVIDED, HOWEVER, that
the ownership of a maximum of one percent of the
outstanding stock of any publicly traded corporation
shall not violate this covenant; or
(2) employ, solicit for employment or assist in employing
or soliciting for employment any present, former or
future employee, officer or agent of the Company or
any of its subsidiaries.
In the event any court of competent jurisdiction should
determine that the foregoing covenant of non-competition is
not enforceable because of the extent of the geographical area
or the duration thereof, then the Company and the affected
Participant hereby petition such court to modify the foregoing
covenant to the extent, but only to the extent, necessary to
create a covenant which is enforceable in the opinion of such
court, with the intention of the parties that the Company
shall be afforded the maximum enforceable covenant of
non-competition which may be available under the circumstances
and applicable law.
(c) Each Participant acknowledges that remedies at law for any
breach by him of this section 13 may be inadequate and that
the damages resulting from any such breach are not readily
susceptible to
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being measured in monetary terms. Accordingly, each
Participant acknowledges that upon his violation of any
provision of this Section 13, the Company will be entitled to
immediate injunctive relief and may obtain an order
restraining any threatened or future breach. Each Participant
further agrees, subject to the proviso at the end of this
sentence, that if he violates any provision of this Section
13, he shall immediately forfeit any rights and benefits under
this Plan and shall return to the Company any unexercised
Options and forfeit the rights under any Restricted Stock
Awards and shall return any shares of Stock held by such
Participant received upon exercise of any Option or the lapse
of the Restrictions relating to Restricted Stock Awards
granted hereunder, together with any proceeds from sales of
any shares of Stock received upon exercise of such Options or
the lapse of Restrictions of such Restricted Stock Awards;
PROVIDED, HOWEVER, that upon violation of subsection (b) of
this Section, the forfeiture and return provisions contained
in this sentence shall apply only to Options which have become
exercisable, and Restricted Stock, the Restrictions with
respect to which have lapsed, and in any such case the
proceeds of sales therefrom, during the two year period
immediately prior to termination of the Participant's
employment. Nothing in this Section 13 will be deemed to
limit, in any way, the remedies at law or in equity of the
Company, for a breach by Participant of any of the provisions
of this Section 13.
(d) Each Participant agrees to provide written notice of the
provisions of this Section 13 to any future employer of
Participant, and the Company expressly reserves the right to
provide such notice to the Participant's future employer(s).
(e) If any provision or part of any provision of this Section 13
is held for any reason to be unenforceable, (i) the remainder
of this Section 13 shall nevertheless remain in full force and
effect and (ii) such provision or part shall be deemed to be
amended in such manner as to render such provision
enforceable.
14. GOVERNING LAW.
The validity, construction and effect of the Plan and any rules
relating to the Plan shall be determined in accordance with the laws of
the State of Delaware and applicable Federal law.
15. ARBITRATION.
The Company and each Participant hereby agree that in the event of any
dispute or controversy arising with respect to the Plan, any Stock
Option Agreement, the exercise of any Option (or the disallowance of
any exercise at any time, for any reason) or any other matter relating
to Options or Restricted Stock Awards, then such dispute or controversy
shall be submitted by the parties to mandatory and binding arbitration
before a panel of arbitrators appointed by the American Arbitration
Association ("AAA"), each of whom shall be knowledgeable in matters of
securities in general and, if possible, the administration of stock
option programs similar to the Plan. The arbitration proceedings shall
be conducted in whichever of the following cities is closest to the
work location of the affected Participant: Fort Lauderdale, Florida;
Chicago, Illinois; New York, New York; Kansas City, Missouri; Jackson,
Mississippi; Nashville, Tennessee or Atlanta, Georgia. The decision of
the Company as to which city is closest to the work location of the
Participant shall be conclusive and binding, except for manifest error.
The decision of the arbitrators shall be rendered in writing, shall be
promptly rendered after a hearing on the matter and shall be final,
conclusive and binding and may be incorporated in a final judgment
rendered by any court of competent jurisdiction.
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<PAGE>
Notwithstanding the foregoing, nothing contained herein shall preclude
the Company from seeking injunctive or other relief from any court of
competent jurisdiction to enforce the provisions of Section 13 hereof.
16. DEFINITIONS.
The following terms, when used in the Plan, shall have the meanings set
forth below:
ACTIVELY TRADED: Trading of Company Stock on the New York
Stock Exchange, the American Stock Exchange or the NASDAQ
National Market System in an average weekly volume that equals
at least 0.20% of the then outstanding Company Stock for each
of at least four weeks in a row.
BENEFICIAL OWNER: With respect to any securities of the
Company, any Person who is a beneficial owner of such
securities as defined in rule 13d-3 under the Exchange Act.
The Committee may from time to time adopt interpretations or
pronouncements as to who shall be deemed to be Beneficial
Owners of the Company's outstanding voting securities as of a
given date, which interpretation shall be final and binding on
all Participants, the Company and all other interested
Persons.
BOARD: The Board of Directors of the Company.
CAUSE: Any cause stated in an employment agreement between the
Company and the Participant and/or material violations of
employment agreements or the terms of this Plan, acts of
dishonesty with respect to the Company, insubordination,
divulging confidential information about the Company,
interference with the relationship between the Company and any
supplier, client, customer, similar person, or performance of
any act or omission which the Committee, in its sole
discretion, deems to be sufficiently injurious to the interest
of the Company to constitute cause.
CHANGE IN CONTROL: The occurrence of any of the following: (i)
a merger or consolidation to which the Company is a party if
the individuals and entities who were stockholders of the
Company immediately prior to the effective date of such merger
or consolidation are Beneficial Owners of less than 50% of the
total combined voting power for election of directors of the
surviving corporation following the effective date of such
merger or consolidation; or (ii) any Person becomes the
Beneficial Owner in the aggregate of securities of the Company
representing 50% or more of the total combined voting power of
the Company's then issued and outstanding securities unless
such Person (or a Person owned directly or indirectly by such
Person) was the Beneficial Owner, directly or indirectly, as
of the Grant Date applicable to the affected Participant, of
more than 50% of the Company's voting securities outstanding
as of such Grant Date; or (iii) the sale of all or
substantially all of the assets of the Company to any person
or entity that is not a wholly-owned subsidiary of the
Company; or (iv) the stockholders of the Company approve any
plan or proposal for the liquidation of the Company.
CHANGE IN STATUS: The occurrence with respect to a
Participant, of any of the following (but only if such event
occurs within two (2) years following a Change in Control):
(i) any reduction in the aggregate annual compensation paid or
payable to a Participant, or any material reduction in the
aggregate benefit coverages provided to such Participant under
the Company's standard benefit package for all employees; (ii)
the assignment to the Participant of any duties inconsistent
in any material respect with the Participant's position
(including status, offices, titles and reporting
12
<PAGE>
responsibilities), authorities, duties or responsibilities as
in effect immediately prior to the date of the Change in
Control; (iii) the Company's requiring the Participant to be
based at any office, facility or location other than the
office, facility or location at which the Participant was
based immediately prior to the date of the Change in Control;
(iv) if the Participant is a party to any employment agreement
with the Company, any material breach by the Company of such
agreement, or any purported termination by the Company of the
Participant's employment otherwise than as permitted by such
employment agreement; or (v) in the case of a director, the
removal of a director or the failure to nominate the director
for reelection.
CODE: Internal Revenue Code of 1986, as amended.
COMMITTEE: A committee designated by the Board consisting of
not less than two members of the Board who are "disinterested
persons," as defined in Rule 16b-3 under the Exchange Act, to
administer the Plan.
COMPANY: Sunbeam Corporation (formerly known as Sunbeam-Oster
Company, Inc.)
CONFIDENTIAL INFORMATION: Any information not generally known
to the public, including, without limiting the generality of
the foregoing, any customer lists, supplier lists, trade
secrets, invention, formulas, methods or processes, whether or
not patented or patentable, channels of distribution, business
plans, pricing policies and records, financial information of
any sort and inventory records of the Company or any affiliate
(and such other information normally understood to be
confidential or otherwise designated as such in writing by the
Company or its subsidiaries). It is not necessary, however,
that any information be formally designated as "confidential"
if it falls within any of the foregoing categories and is not
generally known to the public.
DESIGNATED OTHER: Any consultant, advisor, contractor or agent
of the Company or its subsidiaries, who is not an employee,
officer or Outside Director of the Company and who is granted
Options or a Restricted Stock Award pursuant to this Plan.
EFFECTIVE DATE: January 1, 1991; Amended and Restated as of
May 15, 1996.
ERISA: Titles I and IV of the Employee Retirement Income
Security Act of 1974, as amended.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
EXERCISE PRICE: The Exercise Price of shares purchasable upon
exercise of an Option, as determined pursuant to the terms of
Section 5(a).
FAIR MARKET VALUE: The fair market value of a share of Stock,
as determined pursuant to the terms of Section 7.
GRANT DATE: The date as of which the Committee (or such other
committee of the Board of Directors of the Company as shall be
empowered to grant Options or to make awards of Restricted
Stock) shall grant Options or Restricted Stock, as the case
may be, to a Participant under the Plan, as so designated by
such Committee.
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IN-THE-MONEY: Options to acquire Stock are considered to be
"in-the-money" if the exercise price of the Option is less
than the current market price of the Stock.
NEXT OPTION INCREMENT: This term shall have the meaning
ascribed to it in Section 4(a)(iii).
OPTION: An option, granted under the Plan, to purchase shares
of Stock at the Exercise Price. Options granted under the Plan
shall not be incentive stock options pursuant to Section 422
of the Code.
OPTION YEAR: This term shall have the meaning ascribed to it
in Section 4(a)(iii).
OUT-OF-THE-MONEY: Options to acquire Stock are considered to
be "out-of-the-money" if the exercise price is equal to or
greater than the current market price of the Stock.
OUTSIDE DIRECTOR: A director of the Company who is not either:
(i) an officer or employee of the Company, or (ii) a
Beneficial Owner of, or an officer or employee of any Person
which is a direct or indirect Beneficial Owner of, more than
10% of the outstanding Stock.
PARTICIPANT: An officer, employee, Outside Director of the
Company (or a subsidiary of the Company) or Designated Other
who is granted an Option or a Restricted Stock Award under the
Plan by the Committee. Upon the death of a Participant, the
"Participant" shall be deemed to mean the Participant's estate
or legal representative.
PERSON: Any individual, corporation, partnership, association,
company, trust, joint venture or other organization or entity
or group of associated persons or entities acting in concert.
As used herein, references to the male gender shall include
the female gender or the neuter, as applicable.
PLAN: The Equity Team Plan herein set forth, as it may be
amended from time to time.
RESTRICTED PERIOD: This term shall have the meaning ascribed
to it in Section 4(b)(iii).
RESTRICTED STOCK: Shares of Stock granted pursuant to Section
3(b) or (c) of the Plan.
RESTRICTED STOCK AWARD: The grant of Shares of Restricted
Stock to a Participant pursuant to Section 3(b) or 3(c) of the
Plan.
RESTRICTED STOCK AWARD AGREEMENT: The agreement described in
Section 3(e).
RESTRICTIONS: The restrictions described in Section 4(b)
relating to Restricted Stock.
"SHARES" or "STOCK": The Common Stock, $0.01 par value per
share, of the Company, or such other class of securities as
may be applicable pursuant to the provisions of Section 9.
STOCK OPTION AGREEMENT: The agreement described in Section
3(e).
14
EXHIBIT 10C
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement"), made as of this 24th
day of June, 1996 (but effective as of April 19, 1996), by and between SUNBEAM
CORPORATION, a Delaware corporation (the "Corporation"), and CHARLES J. THAYER
("Executive").
W I T N E S S E T H:
WHEREAS, Executive is currently a director of the
Corporation; and
WHEREAS, the Corporation desires to employ Executive on a
part-time basis for the Term (as defined herein) and Executive is willing to
make his services available to the Corporation on the terms and conditions set
forth below;
NOW, THEREFORE, in consideration of the premises and mutual
promises contained in this Agreement, IT IS AGREED:
1. EMPLOYMENT. The Corporation hereby employs Executive and
Executive hereby accepts employment with the Corporation on the terms and
conditions set forth in this Agreement.
2. TERM. The term of Executive's employment hereunder (the
"Term") shall commence on April 19th, 1996 and, subject to Paragraph 5 hereof,
shall end on the first to occur of December 31, 1996 or 30 days following the
employment by the Corporation of a new Chief Executive Officer.
3. DUTIES. During the Term, Executive shall serve as Vice
Chairman of the Corporation reporting and responsible directly to the Chairman
of the Corporation's Executive Committee and to the Board of Directors of the
Corporation. In his position, Executive,
<PAGE>
shall have such powers and duties as may from time to time be prescribed by
them, including general oversight responsibility for all corporate office
functions of the Corporation. Executive shall devote approximately one-half of
his working time and efforts to the business and affairs of the Corporation.
4. COMPENSATION. Executive's compensation for the services
performed under this Agreement shall be as follows:
A. BASE SALARY. Executive shall receive a base salary of
$25,000 per month ("Base Salary"), payable in full on the first day of each
month, with the initial payment for April to be unreduced and, if not heretofore
paid, to be paid upon execution of this Agreement. In the event Executive's
employment hereunder is terminated by the Corporation for any reason other than
Cause (as hereafter defined) or by Executive in the event of a material breach
of this Agreement by the Corporation prior to receipt of an aggregate of
$150,000 of Base Salary, Executive will be paid at termination the difference
between $150,000 and the aggregate amount of Base Salary theretofore paid. In
the event Executive's employment hereunder is terminated by Executive for any
reason other than material breach of this Agreement by the Corporation, or by
reason of his death or disability, Executive will be entitled to Base Salary
only through the end of the month in which such termination occurs.
B. BONUS COMPENSATION. In addition to the Base Salary,
Executive shall receive minimum bonus compensation in an amount equal to the
total amount received pursuant to Section 4(A)
2
<PAGE>
of this Agreement unless Executive's employment hereunder is terminated by the
Corporation for Cause (in which case, no bonus compensation shall be payable).
The minimum bonus compensation will be due in its entirety promptly upon the
expiration of the Term or the earlier termination of this Agreement.
C. STOCK OPTIONS. Executive will be granted an option to
purchase 45,000 shares of the Corporation's Common Stock under the terms of the
Corporation's stock option plan. The option shall be granted within forty five
(45) days from the date of the execution of this Agreement and shall vest in its
entirety (a) upon the expiration of the Term, or (b) upon the earlier
termination of Executive's employment hereunder (i) by the Corporation for any
reason (other than for Cause), (ii) by Executive in the event of a material
breach of this Agreement by the Corporation or (iii) by reason of Executive's
death or disability. In the event that Executive's employment hereunder is
terminated by the Corporation for Cause or by Executive for any reason other
than a material breach of this Agreement by the Corporation, the option shall be
forfeited.
5. TERMINATION OF EMPLOYMENT. This Agreement may be terminated
at any time by the Corporation for any reason upon payment of the amounts due
pursuant to Sections 4(A) and 4(B) of this Agreement, if any. This Agreement may
also be terminated at any time by Executive for any reason, and shall
automatically terminate upon his death or disability. As used herein,
"disability" shall mean Executive's incapacity due to physical or mental
3
<PAGE>
illness to perform his duties hereunder for thirty (30) consecutive days. For
the purposes of this Agreement, the Company shall have "Cause" to terminate
Executive's employment hereunder upon (i) Executive's intentional refusal or
failure to perform his duties hereunder and the continuation of such refusal or
failure after reasonable notice and opportunity to cure has been given to
Executive, or (ii) the engaging by Executive in misconduct which is demonstrably
injurious to the Company, monetarily or otherwise.
6. REIMBURSEMENT FOR REASONABLE BUSINESS EXPENSES. The
Corporation shall reimburse Executive for reasonable expenses incurred by him in
compliance with the Corporation's existing policies and guidelines in connection
with the performance of his duties pursuant to this Agreement, including, but
not limited to, travel expenses and other reasonable business expenses.
7. INDEMNIFICATION. To the fullest extent permitted by
Delaware law, the Corporation shall indemnify and hold Executive harmless
against any and all liability, including reasonable attorneys' fees, arising out
of any act or omission of the Executive performed in good faith in connection
with his duties under this Agreement. Upon request of Executive, the Corporation
will advance legal fees and costs arising from any third party claim in the
manner and subject to the conditions provided by Delaware law.
8. ENTIRE AGREEMENT. This Agreement contains the entire
agreement of the parties with respect to Executive's
4
<PAGE>
employment by the Corporation and supersedes any prior agreements between them,
whether oral or written.
9. WAIVER. The failure of either party to insist, in any one
or more instances, upon performance of the terms or conditions of this Agreement
shall not be construed as a waiver or a relinquishment of any right granted
hereunder or of the future performance of any such term, covenant, or condition.
10. NOTICES. Any notice to be given hereunder shall be deemed
sufficient if addressed in writing, and delivered by registered or certified
mail or delivered personally or by fax, in the case of the Corporation, to its
principal business office (Attention: General Counsel), and in the case of
Executive, to his address appearing on the records of the Corporation or to such
other address as he may designate in writing to the Corporation.
11. SEVERABILITY. In the event that any provision shall be
held to be invalid or unenforceable for any reason whatsoever, it is agreed such
invalidity or unenforceability shall not affect any other provision of this
Agreement and the remaining covenants and provisions hereof shall remain in full
force and effect and any court of competent jurisdiction may so modify the
objectionable provision as to make it valid, reasonable and enforceable.
12. AMENDMENT. This Agreement may be amended only by an
agreement in writing signed by each of the parties hereto.
13. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
5
<PAGE>
14. BENEFIT. This Agreement shall be binding upon and inure to
the benefit of and shall be enforceable by and against the Corporation, its
successors and assigns and Executive, his heirs, beneficiaries and legal
representatives. The rights and obligations of Executive are personal and may
not be delegated or assigned without the Corporation's consent.
15. CONTINUATION OF EMPLOYMENT FOLLOWING EXPIRATION OF THE
TERM. Unless the parties otherwise agree in writing, the continuation of
Executive's employment with the Corporation beyond the expiration of the Term
shall not be deemed to extend any of the provisions of this Agreement and
Executive's employment may thereafter be terminated by Executive or by the
Corporation at will.
IN WITNESS WHEREOF, the parties hereto have executed or caused
this Agreement to be executed as of the day, month and year first above written.
SUNBEAM CORPORATION
By: \S\PETER LANGERMAN
------------------------------
Peter Langerman
Chairman, Executive Committee
\S\CHARLES J. THAYER
----------------------------
Charles J. Thayer
6
EXHIBIT 10.d
AGREEMENT AND RELEASE
THIS AGREEMENT AND RELEASE (the "Agreement") is entered into as of the
22nd day of May, 1996 (the "date hereof"), by and between SUNBEAM CORPORATION, a
Delaware corporation (the "Company"), and Roger W. Schipke ("Employee").
RECITALS:
A. The Company and Employee are parties to a certain Employment
Agreement dated as of August 1, 1993 (as amended, the "Employment Agreement")
and a certain Equity Award Agreement, also dated as of August 1, 1993 (as
amended, the "Equity Award Agreement");
B. Employee has notified the Company of his intention to terminate the
Employment Agreement pursuant to provisions thereof, and the Company and
Employee have mutually agreed to the termination of Employee's employment on the
terms set forth herein;
NOW, THEREFORE, in consideration of the Recitals set forth above, the
mutual promises and agreements herein contained, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, agree as follows:
SECTION 1. TERMINATION OF EMPLOYMENT PURSUANT TO THE EMPLOYMENT
AGREEMENT. Employee and the Company agree that Employee's employment is hereby
terminated, effective as of May 20, 1996. Employee also hereby resigns,
effective May 20, 1996, all elected or appointed offices or directorships held
by him with the Company and/or any of its subsidiaries or any member of the "SOC
Group," as defined below.
SECTION 2. PAYMENTS TO EMPLOYEE AND TO THE COMPANY. A. PAYMENT TO
EMPLOYEE - In consideration of the execution and delivery of this Agreement by
Employee, and of the releases and covenant not to sue provided for hereunder,
upon execution by Employee of this Agreement, Employee shall be entitled to the
balance of base salary payments due to him under the Employment Agreement in the
sum of $625,000, less applicable withholdings as reflected on EXHIBIT A attached
hereto. The net amount due to Employee ($440,937.48) is herein referred to as
the "Lump Sum".
B. PAYMENT TO THE COMPANY - Employee is indebted to the Company in the
sum of $669,630 (the "Note Balance") pursuant to two promissory notes dated
August 31, 1993 and December 31, 1993, respectively, which notes are accelerated
by their terms by reason of the termination of Employee's employment. Employee
hereby authorizes the Company to apply the Lump Sum referred to in subparagraph
2.A above against the Note Balance. The difference between the Note Balance and
the Lump Sum (i.e.$228,692.52) shall be paid by Employee to the Company
simultaneously with the Company's delivery to Employee of the Restricted Stock
referred to in Section 3 below.
C. SERP ACCOUNT - In addition to the sums due to him pursuant to
Subsection 2.A above, Employee shall receive the balance of his vested
Supplemental Executive Retirement Plan account with the Company, less applicable
withholdings. Such amount shall be paid to Employee simultaneously with the
Company's delivery to Employee of the Restricted Stock referred to in Section 3
below.
D. ACKNOWLEDGMENTS - Employee acknowledges that he is not vested in any
bonus or other incentive plan and that nothing is due and owing to him under any
such arrangement. Employee hereby acknowledges that upon the making of the
payments provided for herein, Employee will have received
<PAGE>
payment in full of all amounts due and owing to him under the Employment
Agreement, except for reimbursement of expenses in the ordinary course (which
the Company will process promptly upon receipt from Employee).
SECTION 3. STOCK OPTIONS AND RESTRICTED STOCK. In consideration of the
execution and delivery of this Agreement and the releases and covenant not to
sue set forth herein, upon execution by Employee of this Agreement, all
restrictions on the remaining 42,500 Restricted Shares awarded to Employee
pursuant to the Equity Award Agreement shall lapse (and the Company shall cause
such shares to be delivered to Employee simultaneously with the payment being
made by Employee to the Company pursuant to Subparagraph 2.B above), and
Employee shall be fully vested in the Option awarded to him pursuant to the
Equity Award Agreement. Employee's exercise of the Option shall be in accordance
with the terms and conditions of the Equity Award Agreement.
SECTION 4. BENEFIT PLANS. In consideration of the execution and
delivery of this Agreement and the releases and covenant not to sue set forth
herein, upon execution by Employee of this Agreement, Employee shall continue to
receive (i) health and dental insurance and (ii) life insurance in the face
amount of One million dollars ($1,000,000) during the balance of 1996 and
throughout 1997 at the cost and expense of the Company, subject to Employee's
continuing obligation to make the Employee's contribution towards the cost of
such coverages as in effect on the date hereof, or as hereafter modified with
respect to all other employees of the Company who are participants in such
plans. Employee's right to the continuation of insurance coverages pursuant to
the provisions of COBRA shall become effective as of January 1, 1998 and shall
continue thereafter for the period of time prescribed by law.
SECTION 5. RELEASE AND COVENANT NOT TO SUE. In consideration of the
sums payable to (and the benefits provided to) Employee as set forth above,
Employee hereby RELEASES and FOREVER DISCHARGES the Company and any parent,
subsidiary, affiliated or related company or trust, including, but not limited
to, its or their respective predecessors, past and present officers, directors,
shareholders, agents, employees, legal representatives, successors, trustees,
fiduciaries, and assigns (collectively the "SOC Group"), of and from (and does
hereby WAIVE), any and all rights, contracts, claims (including claims sounding
in tort), damages, actions, causes of action, and suits, whether or not
presently known, suspected or claimed, which Employee ever had, now has or
claims, or might hereafter have or claim against the SOC Group (including the
Company) and each and all of them, relating to, directly or indirectly, any
matter or thing occurring, in whole or in part, at any time, including, without
limitation, any and all rights, claims, grievances, arbitrations, or causes of
action which Employee has asserted, could assert, or which could be asserted on
his behalf relating to his employment with the Company prior to the date of
execution and delivery of this Agreement or his separation from such employment
under any federal, state or local law, ordinance, regulation or rule, all of the
foregoing as heretofore or hereafter amended, or under any court decree,
heretofore or hereafter promulgated. Employee also WAIVES ANY AND ALL RIGHTS
under the laws of any jurisdictions in the United States that would limit the
foregoing release and waiver. Employee recognizes that, among other things, he
is releasing the SOC Group (including the Company), of and from any and all
claims he might have against it, or any of them, for pain and suffering,
emotional distress, and for discrimination based on age, sex, national origin or
color, mental or physical handicap or disability, or religious belief. Employee
also COVENANTS NOT TO SUE the SOC Group, or any of them, for any of the matters
covered by this Section 5.
There is expressly excluded from the scope of the above release
Employee's right to receive the benefits of this Agreement. There also is
excepted from the scope of this Release and Covenant not to Sue, any and all
claims which Employee may have for indemnification from the Company by reason of
2
<PAGE>
his service as a director or officer of the Company or any of its subsidiaries,
pursuant to the Delaware General Corporation Law, the Certificate of
Incorporation and Bylaws of the Company; provided that Employee shall cooperate
fully with the Company in the defense of any and all such claims for which
indemnification is provided to Employee by the Company.
EMPLOYEE ACKNOWLEDGES THAT THE COMPANY HAS GIVEN HIM ADEQUATE TIME
WITHIN WHICH TO CONSIDER THIS AGREEMENT AND HAS ADVISED HIM IN WRITING TO
CONSULT WITH COUNSEL BEFORE SIGNING THIS AGREEMENT. HE REPRESENTS AND WARRANTS
THAT HE HAS CONSULTED WITH COUNSEL IN THE NEGOTIATION AND PREPARATION OF THIS
AGREEMENT. EMPLOYEE ACKNOWLEDGES THAT HE UNDERSTANDS AND THAT HE HAS ENTERED
INTO THIS AGREEMENT FREELY AND VOLUNTARILY.
SECTION 6. COVENANTS OF CONFIDENTIALITY AND NON-COMPETITION. The
parties hereby incorporate by reference the Confidentiality and Noncompetition
provisions of Section 8 of the Employment Agreement and the related provisions
of Section 9 thereof, and Employee expressly acknowledges his obligations of
Confidentiality and Noncompetition.
SECTION 7. MISCELLANEOUS.
a. Except as otherwise provided in this Agreement, all notices
required or permitted hereunder or process relating hereto
shall be in writing and signed by the party giving notice, and
shall be deemed to have been given when hand-delivered by
personal delivery, by Federal Express or similar courier
service, when sent and confirmed by facsimile, or three (3)
days after being deposited in the United States mail,
registered or certified, with postage prepaid, return receipt
requested, addressed as follows:
If to the Company: SUNBEAM CORPORATION
2100 New River Center
200 East Las Olas Boulevard
Fort Lauderdale, FL 33301
Attention: General Counsel
Facsimile: (954) 767-2105
If to the Employee: Roger W. Schipke
430 Lido Drive
Fort Lauderdale, FL 33301
or to such other address as either party may designate for
himself or itself by notice given to the other party from time
to time in accordance with the provisions hereof.
b. This Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective heirs, legatees,
devisees, personal representatives, successors and assigns.
c. No delay on the part of either party in the exercise of any
right or remedy shall operate
3
<PAGE>
as a waiver thereof, and no single or partial exercise by a
party of any right or remedy shall preclude other or further
exercise thereof or the exercise of any other right or remedy.
The waiver of any breach or condition of this Agreement by
either party shall not constitute a precedent in the future
enforcement of any of the terms and conditions of this
Agreement.
d. This Agreement has been negotiated by the parties, each being
represented by counsel, and any uncertainty or ambiguity shall
not be construed for or against either party as an attribution
of drafting to either party.
e. Whenever possible, each provision of this Agreement shall be
construed and interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this
Agreement or the application thereof to any party or
circumstance shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the
extent of such prohibition without invalidating the remainder
of such provision or any other provision of this Agreement or
the application of such provision to other parties or
circumstances.
f. All discussions, correspondence, understandings and agreements
heretofore made between the parties are superseded by and
merged into this Agreement, which alone fully and completely
expresses the agreement between the parties with respect to
the subject matter hereof (except for provisions of the
Employment Agreement and of the Equity Award Agreement which
are specifically referred to or incorporated by reference
herein), and the same is entered into with neither party
relying upon any statement or representation made by or on
behalf of any party not embodied in this Agreement. Any
modification of this Agreement may be made only by a written
agreement signed by both of the parties to this Agreement.
g. This Agreement shall be governed in all respects by the
internal laws of the State of New York, without regard to
principles of conflicts of laws.
h. The parties hereby agree that the provisions of Section 16 of
the Employment Agreement are by this reference incorporated
herein.
i. No third party shall be deemed to be or shall be, or become,
a beneficiary of any provision of this Agreement. By entering
into this Agreement, the Company has not agreed to grant
similar benefits to any other employee, whether or not
similarly situated, and no precedent, practice, policy or
usage shall be established by the entry of the Company into
this Agreement.
j. This Agreement may be executed in two or more counterparts,
each of which shall constitute an original, and each of which,
when taken together, shall constitute one and the same
instrument.
4
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the dates set forth below and as of the date and year first above written.
EMPLOYEE SUNBEAM CORPORATION
/s/ ROGER W. SCHIPKE /s/ CHARLES J. THAYER
- -------------------- ---------------------
Roger W. Schipke
By: CHARLES J. THAYER
Its: VICE CHAIRMAN
Date: MAY 28, 1996 Date: MAY 22, 1996
5
<PAGE>
EXHIBIT A
Contractual Yearly Pay: $1,000,000
Payments made through May 15 (375,000.03)
Payment Due 624,999.97
---------------
FIT @ 28% (174,999.99)
Medicare @ 1.45% (9,062.50)
---------------
Net Pay 440,937.48
===============
6
EXHIBIT 10.e
AGREEMENT AND RELEASE
THIS AGREEMENT AND RELEASE (the "Agreement") is entered into as of the
23rd day of July, 1996 (the "date hereof"), by and between SUNBEAM CORPORATION,
a Delaware corporation (the "Company"), and James J.Clegg ("Employee").
RECITALS:
A. The Company and Employee are parties to a certain Employment
Agreement dated as of January 1, 1994 (the "Employment Agreement");
B. The Company has notified Employee that it has terminated the
Employment Agreement pursuant to Section 5(b) thereof;
NOW, THEREFORE, the parties hereto, intending to be legally bound,
agree as follows:
SECTION 1. TERMINATION OF EMPLOYMENT PURSUANT TO THE EMPLOYMENT
AGREEMENT. Employee acknowledges that his employment has been terminated,
effective as of July 23rd, 1996. Employee hereby resigns, effective immediately,
all elected or appointed offices or directorships held by him with the Company
and/or any of its subsidiaries or any member of the "SOC Group," as defined
below.
SECTION 2. PAYMENTS TO EMPLOYEE. A. PAYMENT TO EMPLOYEE - In
consideration of the execution and delivery of this Agreement by Employee, and
of the releases and covenant not to sue provided for hereunder, seven (7) days
after execution by Employee of this Agreement, and provided that he has not
revoked this Agreement pursuant to Section 5 below, Employee shall be entitled
to an amount equal to one year's base salary at Employee's current rate of pay,
subject to all applicable withholdings.
B. EBRP ACCOUNT - Employee also shall receive the balance of his vested
Executive Benefit Replacement Plan (otherwise known as the "SERP") account with
the Company, less applicable withholdings.
C. 401(K) ACCOUNT - Employee also shall receive the balance of his
vested 401(k) account, if any.
D. ACKNOWLEDGMENTS - Employee acknowledges that he is not vested in any
bonus or other incentive plan and that nothing is due and owing to him under any
such arrangement. Employee hereby acknowledges that upon the making of the
payments provided for herein, Employee will have received payment in full of all
amounts due and owing to him under the Employment Agreement, except for
reimbursement of business expenses in the ordinary course (which the Company
will process promptly upon receipt from Employee).
SECTION 3. STOCK OPTIONS. Employee is vested in certain stock options
as set forth on EXHIBIT A attached hereto and incorporated by reference herein.
Such options are governed by the terms of the Company's Equity Team Plan, as in
effect on the date hereof.
SECTION 4. BENEFIT PLANS. Employee's insurance coverages shall extend
through the end of the month of July, 1996, and he shall have the rights to
continue certain insurance coverages under the provisions of COBRA for the
period of time prescribed by law.
<PAGE>
SECTION 5. RELEASE AND COVENANT NOT TO SUE. In consideration of the
sums payable to (and the benefits provided to) Employee as set forth above,
Employee hereby RELEASES and FOREVER DISCHARGES the Company and any parent,
subsidiary, affiliated or related company or trust, including, but not limited
to, its or their respective predecessors, past and present officers, directors,
shareholders, agents, employees, legal representatives, successors, trustees,
fiduciaries, and assigns (collectively the "SOC Group"), of and from (and does
hereby WAIVE), any and all rights, contracts, claims (including claims sounding
in tort), damages, actions, causes of action, and suits, whether or not
presently known, suspected or claimed, which Employee ever had, now has or
claims, or might hereafter have or claim against the SOC Group (including the
Company) and each and all of them, relating to, directly or indirectly, any
matter or thing occurring, in whole or in part, at any time, including, without
limitation, any and all rights, claims, grievances, arbitrations, or causes of
action which Employee has asserted, could assert, or which could be asserted on
his behalf relating to his employment with the Company prior to the date of
execution and delivery of this Agreement or his separation from such employment
under any federal, state or local law, ordinance, regulation or rule, all of the
foregoing as heretofore or hereafter amended, or under any court decree,
heretofore or hereafter promulgated. Employee also WAIVES ANY AND ALL RIGHTS
under the laws of any jurisdictions in the United States that would limit the
foregoing release and waiver. Employee recognizes that, among other things, he
is releasing the SOC Group (including the Company), of and from any and all
claims he might have against it, or any of them, for pain and suffering,
emotional distress, and for discrimination based on age, sex, national origin or
color, mental or physical handicap or disability, or religious belief. Employee
also COVENANTS NOT TO SUE the SOC Group, or any of them, for any of the matters
covered by this Section 5.
There is expressly excluded from the scope of the above release
Employee's right to receive the benefits of this Agreement. There also is
excepted from the scope of this Release and Covenant not to Sue, any and all
claims which Employee may have for indemnification from the Company by reason of
his service as a director or officer of the Company or any of its subsidiaries,
pursuant to the Delaware General Corporation Law, the Certificate of
Incorporation and Bylaws of the Company; provided that Employee shall cooperate
fully with the Company in the defense of any and all such claims for which
indemnification is provided to Employee by the Company.
EMPLOYEE ACKNOWLEDGES THAT THE COMPANY HAS GIVEN HIM ADEQUATE TIME (UP
TO 21 DAYS IF HE SO CHOOSES) WITHIN WHICH TO CONSIDER THIS AGREEMENT AND HAS
ADVISED HIM IN WRITING TO CONSULT WITH COUNSEL BEFORE SIGNING THIS AGREEMENT.
EMPLOYEE ACKNOWLEDGES THAT HE UNDERSTANDS AND THAT HE HAS ENTERED INTO THIS
AGREEMENT FREELY AND VOLUNTARILY.
THE PARTIES FURTHER ACKNOWLEDGE THAT FOR A PERIOD OF SEVEN (7) DAYS
FOLLOWING THE EXECUTION OF THIS AGREEMENT, EMPLOYEE MAY REVOKE THIS AGREEMENT.
SUCH REVOCATION SHALL BE MADE IN WRITING AND DELIVERED TO THE GENERAL COUNSEL OF
THE COMPANY BY THE CLOSE OF BUSINESS ON THE SEVENTH DAY FOLLOWING THE EXECUTION
HEREOF BY EMPLOYEE. IF NOT REVOKED WITHIN SUCH SEVEN DAY PERIOD, THIS AGREEMENT
SHALL THEREAFTER BE IRREVOCABLE.
SECTION 6. COVENANTS OF CONFIDENTIALITY AND NON-COMPETITION. The
parties hereby incorporate by reference the Confidentiality and Noncompetition
provisions of the Company's Equity Team Plan, as in effect on the date hereof
and the provisions of Section 7 of the Employment Agreement, and Employee
expressly acknowledges his obligations of Confidentiality and Noncompetition.
2
<PAGE>
SECTION 7. RETURN OF PROPERTY. As soon as possible after the execution
of this Agreement and prior to the payment to Employee of any sums pursuant to
Section 2 hereof, Employee shall return to the Company all Company property in
his possession, including without limitation keys, credit cards, computers and
computer records, files, printouts, plans, forecasts, and any and all other
property of any type. Employee agrees that he shall not enter any office,
factory, or other premises of the Company after the execution of this Agreement
without the prior written consent of the Company.
SECTION 8. MISCELLANEOUS.
a. Except as otherwise provided in this Agreement, all notices
required or permitted hereunder or process relating hereto
shall be in writing and signed by the party giving notice, and
shall be deemed to have been given when hand-delivered by
personal delivery, by Federal Express or similar courier
service, when sent and confirmed by facsimile, or three (3)
days after being deposited in the United States mail,
registered or certified, with postage prepaid, return receipt
requested, addressed as follows:
If to the Company: SUNBEAM CORPORATION
2100 New River Center
200 East Las Olas Boulevard
Fort Lauderdale, FL 33301
Attention: General Counsel
Facsimile: (954) 767-2105
If to the Employee: James J. Clegg
Box 3900 RFD
Long Grove, IL 60047
or to such other address as either party may designate for
himself or itself by notice given to the other party from time
to time in accordance with the provisions hereof.
b. This Agreement shall be binding upon and shall inure to the
benefit of the parties and their respective heirs, legatees,
devisees, personal representatives, successors and assigns.
c. No delay on the part of either party in the exercise of any
right or remedy shall operate as a waiver thereof, and no
single or partial exercise by a party of any right or remedy
shall preclude other or further exercise thereof or the
exercise of any other right or remedy. The waiver of any
breach or condition of this Agreement by either party shall
not constitute a precedent in the future enforcement of any of
the terms and conditions of this Agreement.
d. This Agreement has been negotiated by the parties, each being
represented by counsel, and any uncertainty or ambiguity shall
not be construed for or against either party as an attribution
of drafting to either party.
e. Whenever possible, each provision of this Agreement shall be
construed and interpreted in such manner as to be effective
and valid under applicable law, but if any provision of
3
<PAGE>
this Agreement or the application thereof to any party or
circumstance shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the
extent of such prohibition without invalidating the remainder
of such provision or any other provision of this Agreement or
the application of such provision to other parties or
circumstances.
f. All discussions, correspondence, understandings and agreements
heretofore made between the parties are superseded by and
merged into this Agreement, which alone fully and completely
expresses the agreement between the parties with respect to
the subject matter hereof (except for provisions of the
Employment Agreement and of the Equity Award Agreement which
are specifically referred to or incorporated by reference
herein), and the same is entered into with neither party
relying upon any statement or representation made by or on
behalf of any party not embodied in this Agreement. Any
modification of this Agreement may be made only by a written
agreement signed by both of the parties to this Agreement.
g. This Agreement shall be governed in all respects by the
internal laws of the State of Florida, without regard to
principles of conflicts of laws.
h. No third party shall be deemed to be or shall be, or become,
a beneficiary of any provision of this Agreement. By entering
into this Agreement, the Company has not agreed to grant
similar benefits to any other employee, whether or not
similarly situated, and no precedent, practice, policy or
usage shall be established by the entry of the Company into
this Agreement.
j. This Agreement may be executed in one or more counterparts,
each of which shall constitute an original, and each of which,
when taken together, shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the dates set forth below and as of the date and year first above written.
EMPLOYEE SUNBEAM CORPORATION
\s\JAMES J. CLEGG \s\DAVID C. FANNIN
- ----------------- ------------------
James J. Clegg
By: \s\ DAVID C. FANNIN
--------------------
Its: Executive Vice President
and General Counsel
Date: 7/25/96 Date: 8/2/96
-------- -------
4
<PAGE>
<TABLE>
<CAPTION>
Equity Team Plan Summary
"EQUITY TEAM" PLAN Portfolio
-----------------------------------
Original Option Grants
Name Date in -----------------------------------
Hire Date Position Title Position Date Price Vested*
<S> <C> <C> <C> <C> <C>
- ------------ ------------------------- ---------- ----------- ------- -------
Clegg, James President & COO, NA 09/01/94 01-Jan-91 $5.00 70979
12/05/88 President, Household Prod. 01-Feb-94 $21.46 30000
17-Nov-94 $24.79 27400
01-Nov-95 $14.39 10500
-------
Totals: 138879
<FN>
Note: *Shares vested as of 7/23/96
</FN>
</TABLE>
EXHIBIT 11A
SUNBEAM CORPORATION AND SUBSIDIARIES
CALCULATIONS OF PRIMARY EARNINGS
PER SHARE OF COMMON STOCK
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
---------------------- --------------------
JULY 2, JUNE 30, JULY 2, JUNE 30,
1995 1996 1995 1996
------- -------- ------- --------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net earnings applicable to common
shareholders............................... $11,438 $7,205 $41,443 $24,566
======= ====== ======= =======
Weighted average number of common
shares outstanding........................ 81,776 82,069 81,588 82,026
Add:
Common shares issuable for exercise of
warrants and options, net of shares
assumed to have been acquired with
proceeds therefrom......................... 1,279 380 1,617 428
------ ----- ------ ------
Number of shares applicable to net
earnings per share calculation............. 83,055 82,449 83,205 82,454
======= ====== ====== ======
Primary earnings per share of common
stock...................................... $ .14 $ .09 $ .50 $ .30
</TABLE>
EXHIBIT 11B
SUNBEAM CORPORATION AND SUBSIDIARIES
CALCULATIONS OF FULLY DILUTED EARNINGS
PER SHARE OF COMMON STOCK
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
---------------------- --------------------
JULY 2, JUNE 30, JULY 2, JUNE 30,
1995 1996 1995 1996
-------- -------- --------- --------
(Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net earnings applicable to common
shareholders............................... $11,438 $7,205 $41,443 $24,566
======= ====== ======= =======
Weighted average number of common
shares outstanding........................ 81,776 82,069 81,588 82,026
Add:
Common shares issuable for exercise of
warrants and options, net of shares
assumed to have been acquired with
proceeds therefrom......................... 1,279 380 1,617 455
------- ------- ------- -------
Number of shares applicable to net
earnings per share calculation............. 83,055 82,449 83,205 82,481
======= ======= ======= =======
Fully diluted earnings per share of common
stock...................................... $ .14 $ .09 $ .50 $ .30
</TABLE>
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
AL DUNLAP NAMED CHAIRMAN AND CEO OF SUNBEAM CORPORATION
Fort Lauderdale, FL, (July 18, 1996) -- Sunbeam Corporation (NYSE:SOC)
announced today that Albert J. Dunlap, former Chairman of Scott Paper Company,
has been named Chairman and Chief Executive Officer of Sunbeam effective
immediately.
Peter A. Langerman, Chairman of Sunbeam's Executive Committee, said,
"We are confident that, given his proven track record, Sunbeam will improve its
performance and create additional value for all shareholders."
Mr. Dunlap said, "I appreciate the vote of confidence by the Board of
Directors and welcome the opportunity to help make Sunbeam an even greater
company than it is today. As a leader in many of its primary product categories,
Sunbeam gives me a solid foundation to build upon. I look forward to shaping the
future growth and success of this fine company."
Mr. Dunlap is well known for his success in turning around companies
and improving shareholder value, having done so at eight companies throughout
his career. His most recent success was the remarkable restructuring of Scott
Paper Company where he increased shareholder value by $6.5 billion in less than
two years before it merged with Kimberly Clark last December.
As a demonstration of his commitment to improving shareholder value at
Sunbeam, Mr. Dunlap will invest $3 million of his own funds in Sunbeam stock. In
addition, his compensation arrangement with the company is heavily
stock-oriented.
Mr. Dunlap is equally well known as a spokesman for shareholder rights
and as an advocate of stock compensation for board directors. He is also the
author of a new book to be published in September by Times Books, a division of
Random House, called "Mean Business: How I Save Bad Companies and Make Good
Companies Great."
Sunbeam Corporation is a leading consumer products company that
designs, manufactures and markets, nationally and internationally, a diverse
portfolio of outdoor and household brand name products. The Company's Sunbeam(R)
and Oster(R) brands have been household names for generations, both domestically
and abroad, and the Company is a market leader in many of its product
categories.
Contact: Pete Judice John DeSimone
Burson-Marsteller Manager, Investor Relations
212-614-4506 SUNBEAM CORPORATION
(954) 767-2100
EXHIBIT 99.2
FOR IMMEDIATE RELEASE:
SUNBEAM CORPORATION REPORTS SECOND QUARTER 1996
RESULTS; ANTICIPATES THIRD QUARTER AND FULL YEAR
EARNINGS TO BE BELOW THE PRIOR YEAR
FORT LAUDERDALE, FL - July 24, 1996 - Sunbeam Corporation (NYSE: SOC)
announced second quarter sales of $345.9 million, 12% above second quarter of
1995 sales of $308.8 million. Earnings per share for the quarter of $.09
decreased 36% compared to the $.14 per share reported for the same period last
year. For the first six months of 1996, sales increased approximately 6% over
1995, from $648.3 million to $685.8 million, and earnings per share of $.30
decreased 40% from $.50 per share reported for the first six months of 1995.
While sales increased for the quarter, the operating margin was two
percentage points below the second quarter of 1995. The margin deterioration was
predominately due to higher manufacturing and SG&A costs. During the past two
years, the Company increased production capacity based upon anticipated sales
growth which did not materialize. This increase in capacity has contributed to a
higher cost structure. As a matter of corporate policy, the Company does not
project results for future periods, however, as a result of this increased cost
structure, the Company now expects third quarter and full year earnings per
share to be significantly below the levels reported for the comparable prior
year periods.
Albert Dunlap, the Company's recently appointed Chairman and Chief
Executive Officer stated, "The disappointing financial performance at Sunbeam
over the past 18 months has highlighted that a massive change had to take place
at the Company. In the very near-term, we will be building a highly focused
management team to significantly restructure the Company. The focus will be on
reducing the Company's cost structure, divesting non-core, low margin products
and developing a solid strategy for future growth. Every aspect of the Company's
cost structure will be examined. It is clear that Sunbeam will need to take a
restructuring charge later this year." Mr. Dunlap added, "Sunbeam has a solid
balance sheet with highly recognized brand names and its market leadership in
many product categories provide a strong platform upon which to build."
Certain of the statements contained herein, including statements
relating to the Company's future operating performance, are forward looking
statements, as defined in the Private Securities Litigation Reform Act of 1995.
Actual results could differ materially from those projected in the forward
looking statements as a results of various factors, including those set forth in
the Company's report on Form 8-K, filed with the Securities and Exchange
Commission on January 30, 1996.
Sunbeam Corporation is a leading consumer products company that
designs, manufactures and markets, nationally and internationally, a diverse
portfolio of outdoor and household brand name
<PAGE>
products. The Company's Sunbeam(R) and Oster(R) brands have been household names
for generations, both domestically and abroad, and the Company is a market
leader in many of its product categories.
****************
Contact: John DeSimone
Manager, Investor Relations
Sunbeam Corporation
(305)767-2100
<PAGE>
<TABLE>
<CAPTION>
SUNBEAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share amounts)
Six Months Ended Three Months Ended
June 30, July 2, June 30, July 2,
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net Sales $685.8 $648.3 $345.9 $308.8
Cost of goods sold 550.7 505.2 283.2 248.7
-------- -------- -------- --------
Gross profit 135.1 143.1 62.7 60.1
% of sales 19.7% 22.1% 18.1% 19.5%
Selling, general & administrative expense 87.2 70.8 46.8 39.6
-------- -------- -------- --------
Operating earning 47.9 72.3 15.9 20.5
% of sales 7.0% 11.2% 4.6% 6.6%
Interest expense 6.4 4.9 3.4 2.8
Other (income) expense, net 2.5 (1.6) 1.1 (1.3)
-------- -------- -------- ---------
Earnings before income taxes 39.0 69.0 11.4 19.0
Income taxes 14.4 27.6 4.2 7.6
-------- -------- -------- ---------
Net earnings $24.6 $41.4 $ 7.2 $11.4
======== ======== ======== ========
Earnings per share $0.30 $0.50 $0.09 $0.14
======== ======== ======== ========
Average number of common shares outstanding 82.5 83.2 82.5 83.1
</TABLE>
<PAGE>
SUNBEAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions)
June 30, December 31,
1996 1995
------------ -----------
ASSETS
Current assets:
Cash and cash equivalents $35.8 $28.3
Receivables, net 228.7 216.2
Inventories 327.1 266.7
Defered income taxes 22.4 26.3
Prepaid and other 7.4 19.6
------------ -----------
Total current assets 621.4 557.1
Property, plant and equipment, net 344.8 331.1
Trademarks and trade names, net 210.9 214.0
Non-operating and other assets 53.2 56.5
------------ -----------
$1,230.3 $1,158.7
============ ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term and xurrent portion of long-term debt $1.1 $1.2
Accounts payable 104.2 94.2
Other current liabilities 82.2 94.0
------------ -----------
Total current liabilities 187.5 189.4
Long-term debt 216.4 161.1
Deferred income taxes 77.9 76.9
Non-operating and other long-term liabilities 122.5 130.3
Shareholder's equity 626.0 601.0
------------ -----------
$1,230.3 $1,158.7
============ ===========
<PAGE>
SUNBEAM CORPORATION AND SUBSIDIARIES
CONDOLIDATED STATEMENTS OF CASH FLOW
(in millions)
Six Months Ended
---------------------------
June 30, July 2,
1996 1995
---------- ----------
OPERATING ACTIVITIES
Net earnings $24.6 $41.4
Depreciatioon and amortization 27.2 20.5
Deferred income taxes 4.9 10.6
---------- ----------
56.7 72.5
Decrease from changes in working capital (61.3) (54.5)
Other (2.7) (7.4)
---------- ----------
(7.3) 10.6
INVESTING ACTIVITIES
Capital expenditures (40.2) (75.2)
Change in investments restricted for plant
construction - 29.7
Other 0.03 -
---------- ----------
(39.9) (45.5)
FINANCING ACTIVITIES ACTIVITIES AND OTHER
Issuance of long-term debt 56.5 45.0
Purchase of shares for treasury - (13.1)
Payment of debt obligations (1.3) (5.8)
Proceeds from exercise of warrants and options - 7.4
Other (0.5) (1.6)
---------- ----------
54.7 31.9
---------- ----------
Net increse (decrease) in cash and cash
equivalents 7.5 (3.0)
Cash equivalents, beginning of period 28.3 26.3
---------- ----------
Cash and cash equivalents, end of period $35.8 $23.3
========== ==========
EXHIBIT 99.3
FOR IMMEDIATE RELEASE:
SUNBEAM CORPORATION ANNOUNCES ELECTION OF RUSSELL KERSH AS
EXECUTIVE VICE PRESIDENT, FINANCE AND ADMINISTRATION
FORT LAUDERDALE, FL (July 24, 1996) -- Sunbeam Corporation (SOC)
announced today that Russell A. Kersh has been appointed to the position of
Executive Vice President, Finance and Administration. Mr. Kersh will report
directly to Albert Dunlap, the Company's newly elected Chairman and Chief
Executive Officer, and will be responsible for all finance, human resources, MIS
and purchasing functions of the Company. In addition, Mr. Kersh will be elected
to the Board of Directors of the Company. Mr. Kersh also is making a significant
investment of his own funds in Sunbeam stock.
Mr. Kersh brings to Sunbeam a strong business background and proven
expertise in revitalizing corporations. He most recently assisted Mr. Dunlap in
the highly successful turnaround of Scott Paper Company, serving in the capacity
of Sr. Vice President, Finance and Administration. During their tenure at Scott
Paper Company, shareholder value increased by $6.5 billion in less than two
years before Scott merged with Kimberly Clark last December. Prior to his
employment at Scott Paper Company, Mr. Kersh served as the Chief Financial
Officer/Chief Operating Officer of Adidas North America, Inc. where he was
instrumental in the turnaround of that company. He has also worked with Sir
James Goldsmith as Chief Financial Officer/Operations Director and with Owens
Illinois N/K/A Lily-Tulip, Inc. as Corporate Treasurer.
Sunbeam Corporation is a leading consumer products company that
designs, manufactures and markets, nationally and internationally, a diverse
portfolio of outdoor and household brand name products. The Company's Sunbeam(R)
and Oster(R) brands have been household names for generations, and the Company
is a market share leader in many of its product categories.
<PAGE>
-###-
Contact: Peter Judice John G. De Simone
Burson-Marsteller Manager, Investor Relations
212-614-4506 Sunbeam Corporation
954-767-2100
EXHIBIT 99.4
FOR IMMEDIATE RELEASE
SUNBEAM MANAGEMENT CHANGES ANNOUNCED
Fort Lauderdale, FL, (July 24, 1996) -- Sunbeam Corporation (NYSE:SOC).
Albert Dunlap, Sunbeam's Chairman and Chief Executive Officer, stated today, "As
reflected in our quarterly earnings release earlier today, the poor performance
of Sunbeam obviously will require a massive restructuring. To accomplish this,
we will be recruiting an executive to run the operations of the Company on a
global basis. I expect to announce this appointment quickly. Other
organizational changes will be forthcoming as well.
Consistent with this decision, Jim Clegg, formerly Chief Operating
Officer, North America, is no longer with the Company, effective immediately."
Sunbeam Corporation is a leading consumer products company that
designs, manufactures and markets, nationally and internationally, a diverse
portfolio of outdoor and household brand name products. The Company's Sunbeam(R)
and Oster(R) brands have been household names for generations, both domestically
and abroad, and the Company is a market leader in many of its product
categories.
Contact: John DeSimone
Manager, Investor Relations
SUNBEAM CORPORATION
(954) 767-2100
EXHIBIT 99.5
FOR IMMEDIATE RELEASE:
SUNBEAM CORPORATION NAMES TWO TOP EXECUTIVES
FORT LAUDERDALE, FL - July 29, 1996 - Sunbeam Corporation (NYSE: SOC)
announced today that P. Newton White has been appointed to the position of
Executive Vice President, Consumer Products Worldwide, and John (Jack) Dailey
has been named Vice President, Corporate Purchasing and Logistics, both newly
created positions at Sunbeam.
Mr. White will be responsible for the Company's global consumer
products businesses and will report directly to Albert Dunlap, the Company's
newly elected Chairman and Chief Executive Officer. Mr. White most recently was
instrumental in the highly successful turnaround of Scott Paper Company. As
Senior Vice President, Worldwide Commercial Business, a $1.2 billion division of
Scott Paper, he transitioned Scott's business from a country based focus to an
integrated global business, known for its new product innovations. He developed
a common global strategy and streamlined organization, designed to drive both
worldwide synergies and local customer responsiveness. Following the creation of
Scott's global business unit in 1992, sales and earnings under Mr. White grew
over 30% per year. Prior to that position, Mr. White served as Scott Paper's
Senior Vice President responsible for its Consumer Business in Asia Pacific.
Mr. Dailey will be responsible for all purchasing, warehousing and
distribution across the entire Company and will focus on centralizing these
functions for Sunbeam. He will report to Russell A. Kersh, who last week was
named Sunbeam's Executive Vice President, Finance and Administration. Prior to
joining Sunbeam, Mr. Dailey held similar positions at Scott Paper and
Lily-Tulip, Inc.
The appointments of Mr. White and Mr. Dailey, each of whom will be
making a significant investment of his own funds in Sunbeam stock, represent the
third and fourth major management changes Mr. Dunlap has made in only his first
week as Sunbeam's Chairman and Chief Executive Officer.
Mr. Dunlap stated, "Newt White is a proven global leader with extensive
experience in successfully integrating international and domestic operations,
and Jack Dailey's expertise in purchasing and logistics was responsible for
significant savings at both Scott and Lily-Tulip. These men will be instrumental
in developing and implementing the global growth strategy of Sunbeam."
<PAGE>
Sunbeam Corporation is a leading consumer products company that
designs, manufactures and markets, nationally and internationally, a diverse
portfolio of outdoor and household brand name products. The Company's Sunbeam(R)
and Oster(R) brands have been household names for generations, both domestically
and abroad, and the Company is a market leader in many of its product
categories.
****************
Contact: Pete Judice John DeSimone
Burson-Marsteller, New York Manager, Investor Relations
(212) 614 - 4506 Sunbeam Corporation
(954)767-2100
EXHIBIT 99.6
FOR IMMEDIATE RELEASE
SUNBEAM NAMES OPERATING COMMITTEE
TO HEAD RESTRUCTURING EFFORTS
Fort Lauderdale, FL, (July 31, 1996) -- Sunbeam Corporation (NYSE:SOC)
announced today the formation of a senior Operating Committee to manage the
Company. The Committee has been appointed by Chairman and CEO, Albert Dunlap
and, in addition to Mr. Dunlap, will consist of Russell Kersh, Executive Vice
President, Finance and Administration; Newton White, Executive Vice President,
Consumer Products Worldwide and David Fannin, Executive Vice President and
General Counsel. Russell Kersh and Newton White recently joined the Sunbeam
management team after working closely with Mr. Dunlap in the highly successful
restructuring of Scott Paper Co. Mr. Fannin, who has been with Sunbeam since
1993, continues as the Company's General Counsel, with expanded
responsibilities.
Mr. Dunlap stated, "I set as an initial goal the quick appointment of a
highly focused management team to provide leadership in the transition to the
new Sunbeam Corporation. With today's announcement, the most senior team is now
in place. Other key executives will be involved in all facets of the Sunbeam
restructuring effort. We will focus initially on reducing Sunbeam's inflated
cost structure and will simultaneously build on Sunbeam's solid balance sheet
and valuable brand names to revitalize the Company. Our ambitious - but highly
attainable - goal is to make Sunbeam a global leader among consumer products
companies."
Sunbeam Corporation is a leading consumer products company that
designs, manufactures and markets, nationally and internationally, a diverse
portfolio of outdoor and household brand name products. The Company's Sunbeam(R)
and Oster(R) brands have been household names for generations, both domestically
and abroad, and the Company is a market leader in many of its product
categories.
# # #
Contact: Pete Judice John DeSimone
Burson - Marsteller Manager, Investor Relations
(212) 614-4506 SUNBEAM CORPORATION
(954) 767-2100
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-29-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 35,794
<SECURITIES> 0
<RECEIVABLES> 228,749
<ALLOWANCES> 0
<INVENTORY> 327,093
<CURRENT-ASSETS> 621,411
<PP&E> 489,865
<DEPRECIATION> 145,102
<TOTAL-ASSETS> 1,230,310
<CURRENT-LIABILITIES> 187,535
<BONDS> 216,404
0
0
<COMMON> 880
<OTHER-SE> 625,097
<TOTAL-LIABILITY-AND-EQUITY> 1,230,310
<SALES> 685,809
<TOTAL-REVENUES> 685,809
<CGS> 550,698
<TOTAL-COSTS> 550,698
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,446
<INCOME-PRETAX> 38,990
<INCOME-TAX> 14,424
<INCOME-CONTINUING> 24,566
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,566
<EPS-PRIMARY> .30
<EPS-DILUTED> .30
</TABLE>
