SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. 1)
Under the Securities Exchange Act of 1934
GUARDSMAN PRODUCTS, INC.
(Name of Issuer)
COMMON STOCK $1.00 PAR VALUE
(Title of Class of Securities)
401489-10-9
(CUSIP Number)
John H. Sadler
3112 27th Avenue
Moline, Illinois 61265
(309) 764-9066
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
MARCH 4, 1996
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box [ ].
Check the following box if a fee is being paid with this statement [ ]
The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of the
Act.
________________________________________________________________________________
1) Names of Reporting Persons/S.S. or I.R.S. Identification Nos. of Above
Persons
John H. Sadler ###-##-####
________________________________________________________________________________
2) Check the Appropriate Row if a Member of a Group (See Instructions)
(a)____
(b)____
________________________________________________________________________________
3) SEC Use Only
________________________________________________________________________________
4) Source of Funds oo
________________________________________________________________________________
5) Check if Disclosure of Legal Proceedings is Required Pursuant to Item
2(d) or 2(e) ____
________________________________________________________________________________
6) Citizenship or Place of Organization United States of America
________________________________________________________________________________
Number of (7) Sole Voting Power 773,440
Shares Beneficially __________________________________________________
Owned by
Each (8) Shared Voting Power 0
Reporting __________________________________________________
Person With
(9) Sole Dispositive Power 773,440
__________________________________________________
(10) Shared Dispositive Power 0
________________________________________________________________________________
11) Aggregate Amount Beneficially Owned by Each Reporting Person 773,440
________________________________________________________________________________
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares
________________________________________________________________________________
13) Percent of Class Represented by Amount in Row (11) 8.02%
________________________________________________________________________________
14) Type of Reporting Person (See Instructions) IN
________________________________________________________________________________
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ITEM 1. SECURITY AND ISSUER
This statement relates to the $1.00 par value common stock of
Guardsman Products, Inc. (the "Company"), whose executive offices are
located at 3300 Orchard Vista Dr., S.E., Suite 200, Grand Rapids, Michigan
49501.
ITEM 2. IDENTITY AND BACKGROUND
(a) Name: Mr. John H. Sadler
(b) Business address: 3112 27th Avenue, Moline, Illinois 61265
(c) Mr. John H. Sadler is retired.
(d) Mr. John H. Sadler has not been convicted in a criminal
proceeding during the previous five years.
(e) Mr. John H. Sadler has not been a party in a civil or
administrative proceeding involving an alleged violation of any
state or federal securities laws during the previous five years.
(f) Mr. John H. Sadler is a citizen of the United States of America.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The securities were acquired as consideration for the sale and merger
of Mr. Sadler's business, Moline Paint Manufacturing Co. into a subsidiary
of Issuer.
ITEM 4. PURPOSE OF TRANSACTION
Mr. Sadler plans to hold the shares acquired pursuant to Item 3 for
investment. Mr. Sadler does not have any plans or proposals that relate to
or would result in any of the actions specified in clauses (a) through (j)
of Item 4, Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) Mr. John H. Sadler owns a total of 773,440 shares of the
Company's common stock.
(b) The shares owned by Mr. John H. Sadler represent 8.02 percent of
the outstanding shares of common stock of the Company.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
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ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Pursuant to a Stockholder Agreement dated August 31, 1994, between
John H. Sadler and Guardsman Products, Inc., Mr. Sadler has given an
irrevocable proxy to the Issuer for a period of eight (8) years to vote Mr.
Sadler's stock in the same proportions as all other voting stockholders of
Issuer. The Stockholder Agreement has been amended to remove these voting
restrictions.
Pursuant to an Agreement and Plan of Merger, dated July 15, 1994
between Moline Paint Manufacturing Co. and Guardsman Illinois, Inc. and
joined in by Guardsman Products, Inc. and James L. Sadler and John H.
Sadler, certain contingency payments may be required if a certain stock
price is not achieved within four (4) years or the current dividend level
is not maintained. These provisions may be considered by certain persons
to be guaranteed profit provisions.
In connection with the execution of an Agreement and Plan of Merger
dated March 4, 1996 (the "Merger Agreement") among Guardsman Products, Inc.
(the "Company"), Lilly Industries, Inc. ("Parent") and L. P. Acquisition
Corporation, a wholly owned subsidiary of Parent ("Purchaser"), James L.
Sadler and John H. Sadler (the "Major Shareholders") have each entered into
identical letter agreements with Parent regarding their respective Shares
(each, a "Letter Agreement"). A form of the Letter Agreement is attached
as Appendix A. In the Letter Agreement, each Major Stockholder agrees (i)
to validly tender into the Offer, and not withdraw, all Shares beneficially
owned by him; (ii) if requested by Parent, to vote all of his Shares in
favor of the transactions contemplated by the Merger Agreement, and against
any action or arrangement that would interfere with the successful
completion of those transactions; (iii) to not sell, transfer or grant
voting rights with respect to, or agree to sell, transfer or grant voting
rights with respect to, any of his Shares other than as part of the
transactions contemplated by the Merger Agreement, and likewise to not
purchase any additional Shares while those transactions are pending; and
(iv) to not solicit or encourage the making of any other proposal intended
to lead to the acquisition of his Shares or any other extraordinary
transaction involving the Company. The Letter Agreement provides that it
will remain in effect until the transactions contemplated by the Merger
Agreement, including the Offer and the Merger, are successfully completed
or the Merger Agreement is terminated (either by Parent or the Company) in
accordance with its terms.
In the Letter Agreements Parent agrees to indemnify and hold the
Major Stockholders harmless from and against any and all claims by third
parties or Parent (and its affiliates), judgments, fines, penalties,
liabilities, fees and expenses (including, without limitation, reasonable
attorneys' fees) that may be asserted against or incurred by the Major
Stockholders in connection with their entering into the Letter Agreements
or their compliance with the terms thereof, except that such indemnity
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would not protect them against (i) any violations of law (other than
violations alleged to have occurred as a result of their compliance with
the terms and conditions of the Letter Agreements) or (ii) any breach by
them of their commitments in the Letter Agreements.
In addition, each Major Stockholder has granted to Parent a proxy
to vote his Shares in favor of approving the Merger and against any action,
agreement or arrangement that would result in a breach of the Merger
Agreement or delay or interfere with the Offer or the Merger. The proxy is
irrevocable and terminates upon the first to occur of (i) consummation of
the Merger, (ii) termination of the Merger Agreement in accordance with its
terms and (iii) termination of the Letter Agreement by Parent.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS
The March 4, 1996 Letter Agreement is filed as Appendix A hereto.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
Dated: March 6, 1996 /S/ JOHN H. SADLER
John H. Sadler
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APPENDIX A
March 4, 1996
Mr. John H. Sadler
5402 24th Avenue
Moline, Illinois 61265
Dear Mr. Sadler:
The Board of Directors of Guardsman Products, Inc. ("Guardsman")
has been in discussion with Lilly Industries, Inc. ("Lilly") concerning the
acquisition of Guardsman by Lilly. I am very pleased to inform you that
Lilly is prepared to make a firm offer to purchase all of the outstanding
stock of Guardsman at a price of $23.00 per share (the "Transaction"). The
Transaction will be accomplished by a cash tender offer, to be followed by
a merger at the same price, and is detailed in a definitive agreement
intended to be entered into with Guardsman later today.
As I am sure you can appreciate, Lilly and Guardsman have spent
considerable amounts of time and money in pursuing this Transaction and we
both believe it provides an extremely attractive opportunity for all
Guardsman stockholders. However, in situations like this where one or a
few holders own a significant percentage of a company's stock, it is
appropriate to confirm the support of those holders before a transaction is
officially agreed to and announced. In fact, we recognize you as an
extremely important stockholder of Guardsman, and we will not proceed with
the Transaction unless we have your support.
If you do support the Transaction which Guardsman's Board of
Directors has negotiated on behalf of all stockholders, we would ask that,
as an inducement to us to enter into a definitive agreement providing for
the Transaction, you evidence such support by committing to the following:
1. To validly tender into the tender offer, and not withdraw, all
shares of Guardsman stock that you beneficially own, which you
represent to be approximately 773,440 shares all of which are
owned free and clear of all liens.
2. If requested by us, to vote all of your shares of Guardsman stock
in favor of the described Transaction, and against any action or
arrangement which would interfere with the successful completion
of the Transaction.
3. To not sell, transfer or grant voting rights with respect to, or
agree to sell, transfer or grant voting rights with respect to,
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any of your shares of Guardsman stock other than as part of the
Transaction, and likewise to not purchase any additional shares
of Guardsman while the Transaction is pending.
4. To not solicit or encourage the making of any other proposal
intended to lead to the acquisition of your shares of Guardsman
stock or any other extraordinary transaction involving Guardsman.
In consideration for your entering into this agreement, which you
represent you are free to do without violating any commitments to any other
party, we agree to indemnify you and hold you harmless from and against any
and all claims by third parties or Lilly (and its affiliates), judgments,
fines, penalties, liabilities, fees and expenses (including, without
limitation, reasonable attorneys' fees) that may be asserted against you or
incurred by you in connection with your entering into this letter agreement
or your compliance with the terms hereof, provided that such indemnity
would not protect you against (i) any violations of law (other than
violations alleged to have occurred as a result of your compliance with the
terms and conditions of this letter) or (ii) any breach by you of your
commitments in this letter.
To evidence your agreement with the foregoing, and to allow us to
proceed with the contemplated transaction in reliance on such undertakings,
please sign this letter in the place indicated below and sign the proxy
attached to this letter, which proxy is coupled with an interest. Once
signed, this letter will become our binding agreement unless both of us
elect to modify or terminate it in writing. Your commitments will remain
in effect until the described Transaction is successfully completed or the
definitive agreement which we will sign with Guardsman is terminated
(either by us or Guardsman) in accordance with its terms. Unless otherwise
agreed by both of us in writing, our undertaking to indemnify and hold you
harmless as set forth in the immediately preceding paragraph shall survive
any termination of this agreement, the definitive agreement or the tender
offer for a period of three years, although the indemnity will continue to
cover any claims that may arise during that three-year period. This
agreement will become void and of no effect if the referenced definitive
agreement is not entered into before March 9, 1996. We thank you for your
support.
LILLY INDUSTRIES, INC.
By /S/ ROMAN J. KLUSAS
Roman J. Klusas
Its Vice President and
Chief Financial Officer
AGREED AND ACCEPTED AS OF THE
4TH DAY OF MARCH, 1996
/S/ JOHN H. SADLER
John H. Sadler
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