FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1994
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. 0-5235
HUGHES SUPPLY, INC.
Incorporated in the State I.R.S. Employer I.D.
of Florida Number 59-0559446
Post Office Box 2273
20 North Orange Avenue, Suite 200
Orlando, Florida 32802
Registrant's Telephone Number, including area code: 407/841-4755
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 [ ]
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock Outstanding as of August 26, 1994
$1 Par Value 5,789,594
Page 1
HUGHES SUPPLY, INC.
FORM 10-Q
Index
Page No.
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets as of
July 31, 1994 and January 28, 1994 3 - 4
Consolidated Statements of Income for
the Three Months Ended July 31, 1994
and 1993 5
Consolidated Statements of Income for the
Six Months Ended July 31, 1994 and 1993 6
Consolidated Statements of Cash Flows for the
Six Months Ended July 31, 1994 and 1993 7
Notes to Consolidated Financial Statements 8 - 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results
of Operations 10 - 12
Part II. Other Information
Item 4. Submission of Matters to a Vote of Security
Holders 13 - 14
Item 5. Other Information 14 - 15
Item 6. Exhibits and Reports on Form 8-K 15 - 18
Signatures 19
Index of Exhibits 20
Page 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
HUGHES SUPPLY, INC.
Consolidated Balance Sheets
(dollars in thousands)
July 31, January 28,
1994 1994
----------- ------------
(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 2,362 $ 1,078
Accounts receivable, less allowance for
losses of $6,120 and $3,914 108,315 97,765
Inventories 109,037 94,223
Deferred income taxes 5,868 4,972
Other current assets 2,897 5,532
---------- ----------
Total current assets 228,479 203,570
---------- ----------
Property, Plant and Equipment, at cost:
Land 12,338 12,353
Buildings and improvements 39,830 37,097
Transportation equipment 20,060 19,674
Furniture, fixtures and equipment 17,020 14,843
Leased property under capital leases 10,794 10,794
---------- ----------
Total 100,042 94,761
Less accumulated depreciation and
amortization (48,169) (45,439)
---------- ----------
Net property, plant and equipment 51,873 49,322
---------- ----------
Deferred Income Taxes 2,278 2,210
Other Assets 7,389 8,303
---------- ----------
$ 290,019 $ 263,405
========== ==========
See accompanying notes to consolidated financial statements.
Page 3
HUGHES SUPPLY, INC.
Consolidated Balance Sheets-Continued
(dollars in thousands)
July 31, January 28,
1994 1994
----------- -----------
(unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt $ 969 $ 898
Accounts payable 57,237 52,053
Accrued compensation and benefits 6,298 7,257
Other current liabilities 13,636 8,401
---------- ----------
Total current liabilities 78,140 68,609
---------- ----------
Long-Term Debt, less current portion:
Notes and subordinated debentures 85,074 95,367
Capital lease obligations 3,424 3,859
---------- ----------
Total long-term debt 88,498 99,226
---------- ----------
Other Noncurrent Liabilities 1,286 1,143
---------- ----------
Total liabilities 167,924 168,978
---------- ----------
Shareholders' Equity:
Preferred stock - -
Common stock-6,148,944 and
5,075,670 shares issued 6,149 5,076
Capital in excess of par value 37,290 15,410
Retained earnings 84,223 80,425
---------- ----------
127,662 100,911
Less treasury stock-359,350 and
418,566 shares, at cost (5,567) (6,484)
---------- ----------
Total shareholders' equity 122,095 94,427
---------- ----------
$ 290,019 $ 263,405
========== ==========
See accompanying notes to consolidated financial statements.
Page 4
HUGHES SUPPLY, INC.
Consolidated Statements of Income (unaudited)
(in thousands, except per share amounts)
Three months ended July 31,
1994 1993
----------- -----------
Net Sales $ 202,619 $ 163,950
Cost of Sales 161,663 131,204
---------- ----------
Gross Profit 40,956 32,746
---------- ----------
Operating Expenses:
Selling, general and administrative 32,706 26,990
Depreciation and amortization 2,093 1,729
Provision for doubtful accounts 727 651
---------- ----------
Total operating expenses 35,526 29,370
---------- ----------
Operating Income 5,430 3,376
---------- ----------
Non-Operating Income and (Expenses):
Interest and other investment income 552 470
Interest expense (1,119) (1,209)
Other, net 148 147
---------- ----------
(419) (592)
---------- ----------
Income Before Income Taxes 5,011 2,784
Income Taxes 2,003 1,066
---------- ----------
Net Income $ 3,008 $ 1,718
========== ==========
Earnings Per Share:
Primary $ .51 $ .37
========== ==========
Fully Diluted $ .51 $ .34
========== ==========
Average Number of Shares Outstanding:
Primary 5,943 4,619
========== ==========
Fully Diluted 5,943 5,718
========== ==========
Dividends Per Share $ .05 $ .04
========== ==========
See accompanying notes to consolidated financial statements.
Page 5
HUGHES SUPPLY, INC.
Consolidated Statements of Income (unaudited)
(in thousands, except per share amounts)
Six months ended July 31,
1994 1993
----------- -----------
Net Sales $ 386,520 $ 312,464
Cost of Sales 309,163 250,825
---------- ----------
Gross Profit 77,357 61,639
---------- ----------
Operating Expenses:
Selling, general and administrative 63,077 52,106
Depreciation and amortization 4,142 3,358
Provision for doubtful accounts 1,412 1,233
---------- ----------
Total operating expenses 68,631 56,697
---------- ----------
Operating Income 8,726 4,942
---------- ----------
Non-Operating Income and (Expenses):
Interest and other investment income 1,108 889
Interest expense (2,254) (2,332)
Other, net 335 414
---------- ----------
(811) (1,029)
---------- ----------
Income Before Income Taxes 7,915 3,913
Income Taxes 3,237 1,496
---------- ----------
Net Income $ 4,678 $ 2,417
========== ==========
Earnings Per Share:
Primary $ .84 $ .52
========== ==========
Fully Diluted $ .81 $ .51
========== ==========
Average Number of Shares Outstanding:
Primary 5,596 4,611
========== ==========
Fully Diluted 5,961 5,718
========== ==========
Dividends Per Share $ .10 $ .07
========== ==========
See accompanying notes to consolidated financial statements.
Page 6
HUGHES SUPPLY, INC.
Consolidated Statements of Cash Flows (unaudited)
(in thousands)
Six months ended July 31,
1994 1993
----------- --------
Increase (Decrease) in Cash and Cash
Equivalents:
Cash flows from operating activities:
Cash received from customers $ 375,082 $ 299,649
Cash paid to suppliers and employees (375,816) (297,043)
Interest income received 1,108 889
Interest paid (1,731) (2,379)
Income taxes paid (2,139) (2,188)
---------- ----------
Net cash used in
operating activities ( 3,496) (1,072)
---------- ----------
Cash flows from investing activities:
Capital expenditures (6,788) (4,262)
Proceeds from sale of property, plant
and equipment 446 287
Payment for business acquisitions,
net of cash acquired (905) (3,554)
---------- ----------
Net cash used in
investing activities (7,247) (7,529)
---------- ----------
Cash flows from financing activities:
Net borrowings under
short-term debt arrangements 12,701 9,550
Principal payments on:
Long-term notes (106) (1,610)
Capital lease obligations (363) (330)
Issuance of common shares under
stock option plans 528 12
Purchase of common shares (210) (12)
Dividends paid (523) (251)
---------- ----------
Net cash provided by
financing activities 12,027 7,359
---------- ----------
Net Increase (Decrease) in Cash and
Cash Equivalents 1,284 (1,242)
Cash and Cash Equivalents:
Beginning of period 1,078 2,253
---------- ----------
End of period $ 2,362 $ 1,011
========== ==========
See accompanying notes to consolidated financial statements.
Page 7
HUGHES SUPPLY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. In the opinion of the Company, the accompanying unaudited
consolidated financial statements contain all adjustments
(consisting only of normal recurring accruals) necessary to present
fairly the financial position as of July 31, 1994, the results of
operations for the three months and six months ended July 31, 1994
and 1993, and cash flows for the six months then ended.
2. On March 8, 1994, the Company issued a call for redemption of its
outstanding 7% convertible subordinated debentures to take place on
April 7, 1994. Of the $22,960,000 debentures outstanding at
January 28, 1994, $22,889,000, or 99.7%, were converted into the
Company's common stock at $21.17 per share or 47.2 common shares
for each $1,000 face amount of debentures. This conversion
resulted in the issuance of 1,081,146 common shares. If the
conversion had occurred at the beginning of fiscal year 1995,
primary earnings per share for the six months ended July 31, 1994
would have been $.81. Fully diluted earnings per share for the six
months ended July 31, 1994 of $.81 already assumes the conversion
of the debentures.
3. On May 24, 1994, the shareholders approved an amendment to the
articles of incorporation of the Company increasing the number of
authorized shares of common stock to 20,000,000 shares, $1.00 par
value per share. The shareholders also approved an amendment to
the Directors' Stock Option Plan for non-employee directors (the
"Plan") increasing from 60,000 shares to 135,000 shares the number
of shares as to which options under the Plan may be granted and
extending the term of the Plan from May, 1998 to May, 2003.
Page 8
HUGHES SUPPLY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
(unaudited)
3. The following is a reconciliation of net income to net cash
provided by (used in) operating activities(in thousands):
Six months ended July 31,
1994 1993
---------- ----------
Net income $ 4,678 $ 2,417
Adjustments to reconcile net
income to net cash provided by
(used in) operating activities:
Depreciation 3,718 2,999
Amortization 424 359
Provision for doubtful accounts 1,412 1,233
(Gain) on sale of property,
plant and equipment (154) (188)
Undistributed (earnings) of
affiliate (65) (91)
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable (11,554) (12,950)
Inventories (14,410) 2,447
Other current assets 2,635 2,417
Other assets 326 (110)
Increase (decrease) in:
Accounts payable and accrued
expenses 7,730 1,039
Accrued interest and income
taxes 2,836 (392)
Other noncurrent liabilities 143 95
Decrease (increase) in deferred
income taxes (1,215) (347)
---------- ----------
Net cash provided by
operating activities $ (3,496) $ (1,072)
========== ==========
Noncash Activities:
As discussed in Note 2, the Company issued approximately 1,081,146
shares of common stock for the conversion of $22,889,000 debentures
during the six months ended July 31, 1994.
During the six months ended July 31, 1994, the Company contributed
16,597 treasury shares in the amount of $500,000 to an employee
benefit plan.
Page 9
PART I. FINANCIAL INFORMATION - continued
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
HUGHES SUPPLY, INC.
On March 8, 1994, the Company called for redemption of its 7%
convertible subordinated debentures as of April 7, 1994. Substantially
all of the outstanding debentures were converted into common stock by
April 7, 1994, which resulted in an increase of approximately
$23,000,000 in shareholders' equity and a corresponding decrease of
long-term debt of $23,000,000. As a result of the conversion, 1,081,146
new shares of common stock were issued.
Material Changes in Results of Operations
Net Sales:
Net sales increased 24% to $202.6 million for the three months ended
July 31, 1994 from $163.9 million in the prior year. Net sales for the
six months ended July 31, 1994 were $386.5 million, a 24% increase over
last year's sales of $312.5 million. The three and six month sales
increases reflect the steady recovery of the building industry
throughout the Southeast. In addition, newly-opened and acquired
wholesale outlets accounted for approximately 45% of the increase for
both periods.
Management expects construction activity to remain strong for the
remainder of fiscal year 1995 and is confident that our growth plans can
be sustained through aggressive marketing in existing markets and
selective acquisitions of complementary businesses.
Gross Profit:
Gross profit for the three months ended July 31, 1994 increased 25% to
$41.0 million from $32.7 million for the three months ended July 31,
1993. The gross margin for the three months ended July 31, 1994 was
20.2%, compared to 20.0% last year.
Gross profit increased 26% to $77.4 million for the six months ended
July 31, 1994, compared to $61.6 million last year. The gross margin was
20.0% and 19.7% for the six months ended July 31, 1994 and 1993,
respectively.
The increase in gross profit dollars and the improvement in gross
margins for both periods were due to more efficient purchasing which is
attributable to increased volume and a greater concentration of supply
sources resulting from the Company's preferred vendor program.
Page 10
Operating Expenses:
Operating expenses as a percentage of net sales were 17.5% and 17.9% for
the three months ended July 31, 1994 and 1993, respectively. Operating
expenses increased to $35.5 million for the three months ended July 31,
1994 from $29.4 million last year.
Operating expenses as a percentage of net sales were 17.8% and 18.1% for
the six months ended July 31, 1994 and 1993, respectively, and increased
to $68.6 million from $56.7 million.
The percentages to net sales has declined for both periods compared to
the comparable prior year due to higher volume of sales and the
Company's continuing efforts to control operating costs. Newly-opened
wholesale outlets and recent acquisitions accounted for approximately
45% of the increase in operating expense dollars for both periods. Most
of the remainder of the increases for both periods is due to personnel
and other costs, such as transportation, associated with the growth in
sales.
Non-Operating Income and Expenses:
Interest expense decreased to $1.1 million for the three months ended
July 31, 1994 compared to $1.2 million last year. This decrease is
primarily the result of lower average borrowings for the current quarter
(due primarily to the conversion of the debentures in the first quarter)
compared to the prior year which were partially offset by a slightly
higher effective interest rate during the current year.
Interest expense remained constant at $2.3 million for the six months
ended July 31, 1994 and 1993, respectively. Average borrowings and the
effective interest rate were virtually unchanged for the current six
month period versus the prior year.
Income Taxes:
The effective tax rates were as follows:
1994 1993
Three months ended July 31, 40.0% 38.3%
Six months ended July 31, 40.9% 38.2%
The change in rates is due to fluctuations of nondeductible expenses and
a 1% increase in the federal tax rate.
Net Income:
Net income was $3.0 million for the three months ended July 31, 1994
versus $1.7 million for the three months ended July 31, 1993. Primary
earnings per share were $.51 and $.37 for the three months ended July
31, 1994 and 1993, respectively. Fully diluted earnings per share were
$.51 and $.34 for the three months ended July 31, 1994 and 1993,
respectively.
Page 11
Net income was $4.7 million for the six months ended July 31, 1994
versus $2.4 million for the six months ended July 31, 1993. Primary
earnings per share were $.84 and $.52 for the six months ended July 31,
1994 and 1993, respectively. Fully diluted earnings per share were $.81
and $.51 for the six months ended July 31, 1994 and 1993, respectively.
Liquidity and Capital Resources
The composition of working capital, as sales volume changes, typically
becomes less liquid during periods of sales expansion when it is
necessary to carry higher levels of inventories and receivables. As
discussed above, the Company is in a period of sales expansion.
Consequently, cash used in operating activities increased by
approximately $2.4 million for the six months ended July 31, 1994
compared to the prior year period.
The Company continues to maintain greater than 75% of total assets as
current assets. Working capital at July 31, 1994 amounted to $150.3
million compared to $135.0 million at January 28, 1994. Inventories and
accounts receivable at July 31, 1994 were $14.8 million and $10.6
million higher, respectively, than at January 28, 1994. Despite these
increases, turnover for these assets improved. Inventory turnover was
6.1 and 5.9 times for the six months ended July 31, 1994 and 1993,
respectively. Accounts receivable turnover for these periods was 7.2
and 7.0 times, respectively.
Capital expenditures for the six months ended July 31, 1994 were $6.8
million compared to $4.3 million in the prior year. The increase is
related to the Company's sales growth as new facilities and
transportation equipment have been added to adequately service the
growth. Capital expenditures for fiscal 1995 are expected to be
approximately $10 million, exclusive of acquisitions.
The Company's bank financing consists primarily of a $100 million
unsecured credit facility which includes a $75 million long-term
revolving credit facility and a $25 million line of credit convertible
to a term note. The Company's financial condition remains strong and the
Company has the resources necessary, with approximately $17 million in
unused debt capacity (subject to borrowing limitations under long-term
debt covenants), to meet future working capital requirements. Future
expansion will be financed on a project-by-project basis through
issuance of common stock and additional borrowings.
Page 12
PART II. OTHER INFORMATION
HUGHES SUPPLY, INC.
Item 4. Submission of Matters to a Vote of Security Holders.
(a) Annual Meeting of Shareholders. The Company's 1994
Annual Meeting of Shareholders (the "Annual Meeting") was
held on May 24, 1994.
(b) Election of Directors. Proxies for the Annual Meeting
were solicited by management pursuant to Regulation 14
under the Securities Exchange Act of 1934 ("Regulation
14") and there was no solicitation of proxies in
opposition to managements nominees listed in the Proxy
Statement. All of management's nominees listed in the
Proxy Statement were elected.
(c) Other Matters Voted Upon. In addition to the election of
directors referred to above, the following other matters
were voted upon at the Annual Meeting:
(i) Approval of Amendment to Directors' Stock Option
Plan. The shareholders approved an amendment to the
Directors' Stock Option Plan for non-employee directors
(the "Plan") increasing from 60,000 shares to 135,000
shares the number of shares as to which options under the
Plan may be granted and extending the term of the Plan
from May 29, 1998 to May 24, 2003. The number of shares
voted for the amendment, against the amendment, and
abstaining from voting were as follows: 3,882,329 for
approval; 288,258 against approval; and 27,823 abstaining
from voting. A copy of Amendment No. 1 to Hughes Supply,
Inc. Directors' Stock Option Plan dated May 24, 1994,
setting forth the amendment approved by the shareholders
at the Annual Meeting, and the Hughes Supply, Inc.
Directors Stock Option Plan as adopted by the Board of
Directors on January 24, 1989 and approved by the
shareholders on May 30, 1989, which together constitute
the Plan as presently in effect, is filed as Exhibit 10.4
to this Report.
(ii) Approval of Stock Award Provisions of Senior
Executives' Long-Term Incentive Bonus Plan for Fiscal
Year 1996. Shareholders approved the stock award
provisions of the Senior Executives' Long-Term Incentive
Bonus Plan for Fiscal Year 1996 which had been approved
by the Board of Directors on August 24, 1993 (the "bonus
plan"). Under the terms of the bonus plan the Chief
Executive Officer, President and Chief Financial Officer,
would receive an incentive bonus if the Company achieves
the required earnings per share during the three fiscal
year period beginning with the fiscal year ended January
28, 1994 and ending with the fiscal year to be ended
Page 13
January 26, 1996. Under the bonus plan 50% of any bonus
would be paid in shares of common stock of the Company if
the stock award provisions of the bonus plan were
approved by shareholders and the balance of any such
bonus would be paid in cash. In the absence of such
shareholder approval any such bonus would be paid 100% in
cash. The shareholders approved the stock award
provisions of the bonus plan by the following vote:
4,027,905 shares voted for approval; 151,334 shares voted
against approval; and 19,171 shares abstaining from
voting.
A written description of the bonus plan, which is not set
forth in a formal document, is incorporated into this
Report as Exhibit 10.8 by reference to the description of
the bonus plan set forth under the caption "Approval of
the Stock Award Provisions of the Senior Executives'
Long-Term Incentive Bonus Plan for Fiscal Year 1996" on
pages 26 and 27 of the Proxy Statement.
(iii) Approval of Amendment to Articles of Incorporation
to Increase Number of Authorized Shares of Common Stock.
The shareholders also approved an amendment to the
articles of incorporation of the Company increasing the
number of authorized shares of common stock to 20,000,000
shares of common stock, $1.00 par value per share so that
the authorized capital stock of the Company, after such
amendment, consists of 30,000,000 shares of capital stock
including 20,000,000 shares of common stock and
10,000,000 shares of preferred stock, no par value per
share. The amendment to the articles of incorporation
was approved by the following vote of the shareholders:
3,575,961 voted for the amendment; 609,293 voted against
the amendment; and 13,156 abstaining from voting.
A copy of the Articles of Amendment to Articles of
Incorporation of Hughes Supply, Inc. dated June 14, 1994,
setting forth the amendment approved by the shareholders
at the Annual Meeting, and the Restated Articles of
Incorporation Hughes Supply, Inc. (January 24, 1989), the
articles of incorporation as last previously amended,
which together constitute the articles of incorporation
of the Company as presently in effect, is filed as
Exhibit 3.1 to this Report.
Item 5. Other Information.
Amendment to By-Laws Approved by Board of Directors.
At the annual organizational meeting of the Board of Directors held
on May 24, 1994 following the Annual Meeting the Board of Directors
amended Sections 2 and 3 of Article IV of the By-Laws of the
Company to provide that the Chairman of the Board of Directors
shall be the chief executive officer and that the President shall
be the chief operating and administrative officer. A copy of the
Page 14
By-Laws designated as the Composite By-Laws of Hughes Supply, Inc.
(as amended May 24, 1994) including the amendments adopted by the
Board of Directors is filed as Exhibit 3.2 to this Report.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits Filed.
(2) Plan of acquisition, reorganization, arrangement,
liquidation or succession - not applicable.
(3) Articles of incorporation and by-laws.
3.1 Articles of incorporation consisting of Articles of
Amendment to Articles of Incorporation of Hughes
Supply, Inc. dated June 14, 1994 and Restated
Articles of Incorporation of Hughes Supply, Inc.
(January 24, 1989).
3.2 Composite By-Laws of Hughes Supply, Inc. (as
amended May 24, 1994).
(4) Instruments defining the rights of security holders,
including indentures.
4.1 Specimen Stock Certificate representing shares of
the Company's common stock, $1.00 par value, filed
as Exhibit 4.2 to form 10-Q for the quarter ended
October 31, 1984.
4.2 Specimen Copy of Certificate representing 7%
Convertible Debentures, filed as Exhibit 4(c) to
Registration No. 33-4714.
4.3 Resolution Approving and Implementing Shareholder
Rights Plan filed as Exhibit 4.4 to Form 8-K dated
May 17, 1988.
(10) Material contracts.
10.1 Lease Agreements with Hughes, Inc.
(a) Orlando Trucking, Garage and Maintenance
Operations dated December 1, 1971, filed as
Exhibit 13(n) to Registration No. 2-43900.
Letter dated April 15, 1992 extending lease
from month to month, filed as exhibit 10.1(a)
to Form 10-K for the fiscal year ended January
31, 1992.
Page 15
(b) Leases effective March 31, 1988, filed as
exhibit 10.1(c) to Form 10-K for the fiscal
year ended January 27, 1989;
Sub-item Property
(1) Clearwater
(2) Daytona Beach
(3) Fort Pierce
(4) Lakeland
(5) Lakeland - Lightstyle
(6) Leesburg
(7) Orlando Electrical Operation
(8) Orlando Plumbing Operation
(9) Orlando Utility Warehouse
(10) St. Petersburg
(11) Sarasota
(12) Venice
(13) Winter Haven
(c) Lease amendment letter between Hughes,
Inc. and the Registrant, dated December
1, 1986, amending Orlando Truck
Operations Center and Maintenance Garage
lease, filed as Exhibit 10.1(i) to Form
10-K for the fiscal year ended January
30, 1987.
(d) Lease agreement dated June 1, 1987,
between Hughes, Inc. and the Registrant,
for additional Sarasota property, filed
as Exhibit 10.1(j) to Form 10-K for the
fiscal year ended January 29, 1988.
(e) Leases dated March 11, 1992, filed as
Exhibit 10.1(e) to Form 10-K for the
fiscal year ended January 31, 1992.
Sub-item Property
(1) Tallahassee Electrical Operation
(2) Gainesville Electrical Operation
(3) Valdosta Electrical Operation
10.2 Hughes Supply, Inc. 1988 Stock Option Plan
filed as Exhibit A to Prospectus included in
Registration No. 33-26468.
10.3 Form of Supplemental Executive Retirement Plan
Agreement entered into between the Registrant
and eight of its executive officers, filed as
Exhibit 10.6 to Form 10-K for fiscal year
ended January 30, 1987.
Page 16
10.4 Directors' Stock Option Plan consisting of
Amendment No. 1 to Hughes Supply, Inc.
Directors' Stock Option Plan dated May 24,
1994 and Hughes Supply, Inc. Directors' Stock
Option Plan as adopted January 24, 1989.
10.5 Asset Purchase Agreement with Accord
Industries Company, dated October 9, 1990, for
sale of Registrant's manufacturing operations,
filed as Exhibit 10.7 to Form 10-K for fiscal
year ended January 25, 1991.
10.6 Lease Agreement dated June 30, 1993 between
Donald C. Martin and Electrical Distributors,
Inc., filed as Exhibit 10.6 to Form 10-K for
fiscal year ended January 28, 1994.
10.7 Consulting Agreement dated June 30, 1993
between Hughes Supply, Inc. and Donald C.
Martin, filed as Exhibit 10.7 to Form 10-K for
fiscal year ended January 28, 1994.
10.8 Written description of senior executives'
long-term incentive bonus plan for fiscal year
1996 incorporated by reference to the
description of the bonus plan set forth under
the caption "Approval of the Stock Award
Provisions of the Senior Executives' Long-Term
Incentive Bonus Plan for Fiscal Year 1996" on
pages 26 and 27 of the Registrant's Proxy
Statement Annual Meeting of Shareholders To Be
Held May 24, 1994.
(11) Statement re computation of per share earnings.
11.1 Summary schedule of earnings per share calculation.
(15) Letter re unaudited interim financial information - not
applicable.
(18) Letter re change in accounting principles - not
applicable.
(19) Report furnished to security holders - not applicable.
(22) Published report regarding matters submitted to vote of
security holders - not applicable.
(23) Consents of experts and counsel - not applicable.
(24) Power of attorney - not applicable.
(27) Financial Data Schedule.
27.1 Financial Data Schedule.
Page 17
(99) Additional exhibits - not applicable.
(b) Reports on Form 8-K.
During the quarter ended July 31, 1994, the Registrant filed
a Current Report on Form 8-K dated May 24, 1994, which
reported under Item 4 (Change in Registrant's Certifying
Accountant) the appointment of Price Waterhouse LLP as
auditors for the three fiscal year period commencing with the
Registrant's current fiscal year ending January 27, 1995.
Page 18
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
HUGHES SUPPLY, INC.
Date: September 12, 1994 By: /s/ David H. Hughes
David H. Hughes, Chairman of
the Board and Chief Executive
Officer
Date: September 12, 1994 By: /s/ J. Stephen Zepf
J. Stephen Zepf, Treasurer,
Chief Financial Officer and
Chief Accounting Officer
Page 19
INDEX OF EXHIBITS FILED WITH THIS REPORT
3.1 Articles of Incorporation.
3.2 Composite By-Laws.
10.4 Directors' Stock Option Plan.
11.1 Computation of Per Share Earnings.
27.1 Financial Data Schedule
Page 20
Exhibit 11.1
HUGHES SUPPLY, INC.
SUMMARY SCHEDULE OF EARNINGS PER SHARE CALCULATIONS
(in thousands, except per share amounts)
Potentially dilutive securities:
a) Options for common stock, issued under stock option plan.
b) 7% Convertible subordinated debentures, due May 1, 2011.
Three Months
Ended July 31,
1994 1993
Line
- - ----
SHARES
------
1 Average shares outstanding 5,789 4,552
2 Incremental shares (options) -
Assuming options outstanding at end of period
were exercised at beginning of period (or time
of issuance, if later) and proceeds were used
to purchase shares at average market price
during the period 154 67
---------- ----------
3 Shares used in calculating Earnings Per
Common and Common Equivalent Share 5,943 4,619
4 Incremental shares (options) -
Assuming options outstanding at end of period
were exercised at beginning of period (or time
of issuance, if later) and proceeds were used
to purchase shares at the higher of the
average market price during the period or the
market price at the end of the period; and
that options exercised during the period were
exercised at the beginning of the period(or
time of issuance, if later) and the proceeds
were used to purchase shares at the market
price at the date of exercise - 14
5 Incremental shares (debentures) -
Assuming debentures were converted at
beginning of period (or time of issuance, if
later) at most advantageous (for security
holder) conversion rate that becomes
effective within 10 years - 1,085
---------- ----------
6 Shares used in calculating Earnings Per
Common Share - Assuming Full Dilution 5,943 5,718
========== ==========
EARNINGS
--------
7 Net income per financial statements, used in
calculating Earnings Per Common Share and
Earnings Per Common and Common Equivalent
Share $ 3,008 $ 1,718
8 Incremental earnings (debentures) -
Assuming interest charges applicable to
convertible debentures (and nondiscretionary
adjustments that would have been made based
on net income) are taken into account in
determining balance of income applicable to
common stock - 249
---------- ----------
9 Earnings used in calculating Earnings Per
Common Share - Assuming Full Dilution $ 3,008 $ 1,967
========== ==========
Three Months
Ended July 31,
1994 1993
Line
- - ----
RESULTING PER SHARE DATA
------------------------
10 Earnings per common share (Line 7/Line 1) $ .52 $ .38
=========== ===========
11 Earnings per common share and common
equivalent share (Line 7/Line 3) $ .51 $ .37
=========== ===========
12 Dilution 1.9% 2.6%
=========== ===========
13 Earnings per common share - assuming full
dilution (Line 9/Line 6) $ .51 $ .34
=========== ===========
14 Dilution 1.9% 10.5%
=========== ===========
15 Used in statements of income:
[ ] Line 10, if dilution less than 3%, or antidilution, exists for all
periods.
[ X ] Lines 11 and 13, if dilution >= 3% for any period.
Six Months
Ended July 31,
1994 1993
Line
- - ----
SHARES
------
1 Average shares outstanding 5,424 4,552
2 Incremental shares (options) -
Assuming options outstanding at end of period
were exercised at beginning of period (or time
of issuance, if later) and proceeds were used
to purchase shares at average market price
during the period 172 59
---------- ----------
3 Shares used in calculating Earnings Per
Common and Common Equivalent Share 5,596 4,611
4 Incremental shares (options) -
Assuming options outstanding at end of period
were exercised at beginning of period (or time
of issuance, if later) and proceeds were used
to purchase shares at the higher of the
average market price during the period or the
market price at the end of the period; and
that options exercised during the period were
exercised at the beginning of the period(or
time of issuance, if later) and the proceeds
were used to purchase shares at the market
price at the date of exercise 5 22
5 Incremental shares (debentures) -
Assuming debentures were converted at
beginning of period (or time of issuance, if
Six Months
Ended July 31,
1994 1993
Line
- - ----
later) at most advantageous (for security
holder) conversion rate that becomes
effective within 10 years 360 1,085
---------- ----------
6 Shares used in calculating Earnings Per
Common Share - Assuming Full Dilution 5,961 5,718
========== ==========
EARNINGS
--------
7 Net income per financial statements, used in
calculating Earnings Per Common Share and
Earnings Per Common and Common Equivalent
Share $ 4,678 $ 2,417
8 Incremental earnings (debentures) -
Assuming interest charges applicable to
convertible debentures (and nondiscretionary
adjustments that would have been made based
on net income) are taken into account in
determining balance of income applicable to
common stock 166 498
---------- ----------
9 Earnings used in calculating Earnings Per
Common Share - Assuming Full Dilution $ 4,844 $ 2,915
========== ==========
RESULTING PER SHARE DATA
------------------------
10 Earnings per common share (Line 7/Line 1) $ .86 $ .53
=========== ===========
11 Earnings per common share and common
equivalent share (Line 7/Line 3) $ .84 $ .52
=========== ===========
12 Dilution 2.3% 1.9%
=========== ===========
13 Earnings per common share - assuming full
dilution (Line 9/Line 6) $ .81 $ .51
=========== ===========
14 Dilution 5.8% 3.8%
=========== ===========
15 Used in statements of income:
[ ] Line 10, if dilution less than 3%, or antidilution, exists for all
periods.
[ X ] Lines 11 and 13, if dilution >= 3% for any period.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE CONSOLIDATED BALANCE SHEET OF HUGHES SUPPLY, INC. AS OF JULY 31, 1994,
AND THE RELATED STATEMENT OF INCOME FOR THE SIX MONTHS THEN ENDED AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000049029
<NAME> HUGHES SUPPLY, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JAN-27-1995
<PERIOD-END> JUL-31-1994
<CASH> 2,362
<SECURITIES> 0
<RECEIVABLES> 114,435
<ALLOWANCES> 6,120
<INVENTORY> 109,037
<CURRENT-ASSETS> 228,479
<PP&E> 100,042
<DEPRECIATION> 48,169
<TOTAL-ASSETS> 290,019
<CURRENT-LIABILITIES> 78,140
<BONDS> 88,498
<COMMON> 6,149
0
0
<OTHER-SE> 115,946
<TOTAL-LIABILITY-AND-EQUITY> 290,019
<SALES> 386,520
<TOTAL-REVENUES> 386,520
<CGS> 309,163
<TOTAL-COSTS> 309,163
<OTHER-EXPENSES> 67,219
<LOSS-PROVISION> 1,412
<INTEREST-EXPENSE> 2,254
<INCOME-PRETAX> 7,915
<INCOME-TAX> 3,237
<INCOME-CONTINUING> 4,678
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,678
<EPS-PRIMARY> .84
<EPS-DILUTED> .81
</TABLE>
` ARTICLES OF AMENDMENT
to
ARTICLES OF INCORPORATION
of
HUGHES SUPPLY, INC.
Pursuant to the provisions of Chapter 607, Florida Statutes, the
undersigned corporation has adopted the amendment to its articles
of incorporation, last previously amended and restated as the
Restated Articles of Incorporation of Hughes Supply, Inc. (January
24, 1989) filed with the State of Florida Department of State on
February 27, 1989 (such articles of incorporation being hereinafter
referred to as its "Articles of Incorporation"), hereinafter set
forth.
FIRST: The name of the corporation amending its Articles of
Incorporation is:
HUGHES SUPPLY, INC.
SECOND: The amendment to its Articles of Incorporation adopted by
the corporation amends Article III, Section A of its Articles of
Incorporation increasing the maximum authorized number of shares of
stock of all classes from 20,000,000 shares, consisting of
10,000,000 shares of Common Stock and 10,000,000 shares of
Preferred Stock to 30,000,000 shares, consisting of 20,000,000
shares of Common Stock and 10,000,000 shares of Preferred Stock, so
that Article III is amended to read in its entirety as follows:
ARTICLE III
Section A. The maximum number of shares of all
classes of stock which this Corporation is authorized to
issue or to have outstanding at any time shall be
30,000,000 shares, which shall be divided as follows:
(1) Not more than 20,000,000 shares of Common
Stock of $1.00 par value per share (which shall be
designated "Common Stock"); and
(2) Not more than 10,000,000 shares of
Preferred Stock of no par value per share (which shall be
designated "Preferred Stock").
Section B. Each holder of Common Stock shall have
one vote per share of such stock held, upon the payment
of the consideration fixed for the issuance of said
stock, whether such payment is made in money or in
property to be exchanged therefor at a reasonable
valuation. Said stock shall be fully paid and non-
assessable.
Section C. Holders of Common Stock shall not have
preemptive rights to purchase additional shares of Common
Stock or other securities of the Corporation whether or
not such stock or other securities are issued for cash.
Holders of securities other than Common Stock shall not
have any preemptive or other right to subscribe for, or
right of conversion into Common Stock, Preferred Stock,
or other stock or securities of the Corporation, except
such rights, if any, as may be expressly granted by the
Board of Directors.
Section D. The designations, powers, preferences,
and rights, and the qualifications, limitations, or
restrictions of the Preferred Stock shall be as follows:
Dividends on the outstanding shares of Preferred
Stock shall be declared and paid or set apart for payment
before any dividends shall be declared and paid or set
apart for payment on the outstanding shares of Common
Stock with respect to the same quarterly period.
Dividends on any shares of Preferred Stock shall be
cumulative only if and to the extent determined by
resolution of the Board of Directors, as provided below.
In the event of any liquidation, dissolution, or winding
up of the affairs of the Corporation, whether voluntary
or involuntary, the outstanding shares of Preferred Stock
shall have preference and priority over the outstanding
shares of Common Stock for payment of the amount, if any,
to which shares of each outstanding series of Preferred
Stock may be entitled in accordance with the terms and
rights thereof and each holder of Preferred Stock shall
be entitled to be paid in full such amount, or have a sum
sufficient for the payment in full set aside, before any
such payments shall be made to the holders of Common
Stock.
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 such voting powers and with such
designations, preferences and relative participating,
optional or other rights, qualifications, limitations or
restrictions, as shall be stated and expressed in the
resolution or resolutions providing for the issue thereof
adopted by the Board of Directors, and as are not stated
and expressed in these Articles of Incorporation or any
amendment thereto or prohibited by law, including the
following:
(1) The distinctive designation of such series
and the number of shares which shall constitute such
series, which number may be increased (except where
otherwise provided by the Board of Directors in creating
such series) or decreased (but not below the number of
shares thereof then outstanding) from time to time by the
Board of Directors; and
(2) The rate or manner of payment of dividends
on shares of each such series, including the dividend
rate, date of declaration and payment, whether dividends
shall be cumulative, and the conditions upon which and
the date from which such dividends shall be cumulative;
and
(3) Whether the shares of such series can be
redeemed, the time or times when, and the price or prices
at which, shares of such series shall be redeemable, and
the terms and conditions of redemption; and
(4) The amount payable on shares of such
series and the rights of holders of such shares in the
event of any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the
Corporation; and
(5) The sinking fund provisions, if any, for
the redemption or purchase of shares of such series; and
(6) The rights, if any, of the holders of
shares of such series to convert such shares into, or
exchange such shares for, shares of Common Stock, or any
other securities, and the terms and conditions of such
conversion or exchange; and
(7) The voting rights, if any, whether full or
limited, of the shares of such series; provided, however,
that the voting rights of such Preferred Stock shall not
exceed one vote per share thereof and no share shall have
any voting rights until the payment therefor shall have
been received by the Corporation.
Except in respect of the particulars that may be
fixed by the Board of Directors as provided above in this
Article III, Section D, all shares of Preferred Stock
shall be of equal rank and shall be identical, and each
share of a series shall be identical in all respects with
the other shares of the same series. When payment of the
consideration for which shares of Preferred Stock are to
be issued shall have been received by the Corporation,
such shares shall be deemed to be fully paid and
nonassessable.
The Board of Directors, pursuant to the above
authorization contained in this Section D of Article III
on May 17, 1988 authorized the issuance of Series A
Junior Participating Preferred Stock as set forth in the
Resolution Establishing Series A Junior Participating
Preferred Stock which is attached to and incorporated by
reference herein as Appendix A to these Articles of
Amendment.
THIRD: The above amendment was approved by the Board of Directors
of the corporation on March 24, 1994 and recommended to the board
of directors for approval by the holders of Common Stock, the only
outstanding class of stock of the corporation.
FOURTH: The above amendment was approved by the shareholders on
May 24, 1994 by the affirmative vote of the holders of a majority
of the shares of Common Stock outstanding and entitled to vote on
the amendment. The number of votes cast was sufficient for
approval of the amendment.
Dated: June 14, 1994
HUGHES SUPPLY, INC.
By s/A. Stewart Hall, Jr.
A. Stewart Hall, Jr.
President
By s/Robert N. Blackford
Robert N. Blackford
Secretary
<PAGE>
APPENDIX A
TO
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
HUGHES SUPPLY, INC.
RESOLUTION ESTABLISHING
SERIES A JUNIOR PARTICIPATING
PREFERRED STOCK
RESOLVED, that pursuant to the authority vested in this Board
of Directors in accordance with the provisions of this
Corporation's Articles of Incorporation, a series of Preferred
Stock of this Corporation be, and it hereby is, created, and that
the designation and amount thereof and the voting powers,
preferences and relative, participating, optional and other special
rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
Section 1. Designation and Amount. The shares of such series
shall be designated as "Series A Junior Participating Preferred
Stock" and the number of shares constituting such series shall be
300,000.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Cumulative Preferred Stock
ranking prior and superior to the shares of Series A Junior
Participating Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Participating Preferred Stock
shall be entitled to receive, when, as and if declared by the Board
of Directors out of funds legally available for the purpose,
quarterly dividends payable in cash on the third Friday in
February, May, August and November of each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series A Junior
Participating Preferred Stock, in an amount per share (rounded to
the nearest cent) equal to the greater of (a) $1.25 or (b) subject
to the provision for adjustment hereinafter set forth, 100 times
the aggregate per share amount of all cash dividends, and 100 times
the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise), declared on the
Common Stock, par value $1.00 per share, of the Corporation (the
"Common Stock") since the immediately preceding Quarterly Dividend
Payment Date, or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of
a share of Series A Junior Participating Preferred Stock. In the
event the Corporation shall at any time after May 17, 1988 (the
"Rights Declaration Date") (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the amount to
which holders of shares of Series A Junior Participating Preferred
Stock were entitled immediately prior to such event under clause
(b) of the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares
of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Junior Participating Preferred Stock
as provided in paragraph (A) above immediately after it declares a
dividend or distribution on the Common Stock (other then a dividend
payable in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend
of $1.25 per share on the Series A Junior Participating Preferred
Stock shall nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Junior Participating Preferred Stock
from the Quarterly Dividend Payment Date next preceding the date of
issue of such shares of Series A Junior Participating Preferred
Stock, unless the date of issue of such shares is prior to the
record date for the first Quarterly Dividend Payment Date, in which
case dividends on such shares shall begin to accrue from the date
of issue of such shares, or unless the date of issue is a Quarterly
Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Junior Participating
Preferred Stock entitled to receive a quarterly dividend and before
such Quarterly Dividend Payment Date, in either of which events
such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares of Series A
Junior Participating Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of
shares of Series A Junior Participating Preferred Stock entitled to
receive payment of a dividend or distribution declared thereon,
which record date shall be no more than 30 days prior to the date
fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A
Junior Participating Preferred Stock shall have the following
voting rights:
(A) Each share of Series A Junior Participating Preferred
Stock shall entitle the holder thereof to 1 vote on all matters
submitted to a vote of the stockholders of the Corporation.
(B) Except as otherwise provided herein or by law, the
holders of shares of Series A Junior Participating Preferred Stock end
the holders of shares of Common Stock shall vote together as one class
on all matters submitted to a vote of stockholders of the Corporation.
(C) Holders of Series A Junior Participating Preferred Stock
shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of
Common Stock as set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Junior Participating Preferred
Stock as provided in Section 2 are in arrears, thereafter and until all
accrued end unpaid dividends and distributions, whether or not declared,
on shares of Series A Junior Participating Preferred Stock outstanding
shall have been paid in full, the Corporation shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire
for consideration, any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding
up) to the Series A Junior Participating Preferred Stock;
(ii) declare or pay dividends on, or make any
other distributions on, any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Junior
Participating Preferred Stock, except dividends paid
ratably on the Series A Junior Participating Preferred
Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts
to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire
for consideration shares of any stock ranking on a parity
(either as to dividends or upon liquidation, dissolution
or winding up) with the Series A Junior Participating
Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any
such parity stock in exchange for shares of any stock of
the Corporation ranking junior (either as to dividends or
upon dissolution, liquidation or winding up) to the Series
A Junior Participating Preferred Stock;
(iv) purchase or otherwise acquire for
consideration any shares of Series A Junior Participating
Preferred Stock, or any shares of stock ranking on a
parity with the Series A Junior Participating Preferred
Stock, except in accordance with a purchase offer made in
writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms
as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights
and preferences of the respective series and classes,
shall determine in good faith will result in fair and
equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation could,
under paragraph (A) of this Section 4, purchase or otherwise acquire
such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Junior
Participating Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and cancelled
promptly after the acquisition thereof. All such shares shall upon
their cancellation become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of
Preferred Stock to be created by resolution or resolutions of the
Board of Directors, subject to the conditions and restrictions on
issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. (A) Upon
any liquidation (voluntary or otherwise), dissolution or winding up
of the Corporation, no distribution shall be made to the holders of
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock unless, prior thereto, the holders of
shares of Series A Junior Participating Preferred Stock shall have
received $100 per share, plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the
date of such payment (the "Series A Liquidation Preference").
Following the payment of the full amount of the Series A Liquidation
Preference, no additional distributions shall be made to the holders
of shares of Series A Junior Participating Preferred Stock unless,
prior thereto, the holders of shares of Common Stock shall have
received an amount per share (the "Common Adjustment") equal to the
quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 100 (as appropriately adjusted as set forth in
subparagraph C below to reflect such events as stock splits, stock
dividends and recapitalizations with respect to the Common Stock)
(such number in clause (ii), the "Adjustment Number"). Following the
payment of the full amount of the Series A Liquidation Preference
and the Common Adjustment in respect of all outstanding shares of
Series A Junior Participating Preferred Stock and Common Stock,
respectively, holders of Series A Junior Participating Preferred
Stock and holders of shares of Common Stock shall receive their
ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with respect
to such Preferred Stock and Common Stock, on a per share basis,
respectively.
(B) In the event, however, that there are not sufficient
assets available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all other series of
preferred stock, if any, which rank on a parity with the Series A
Junior Participating Preferred Stock, then such remaining assets shall
be distributed ratably to the holders of such parity shares in
proportion to their respective liquidation preferences. In the event,
however, that there are not sufficient assets available to permit
payment in full of the Common Adjustment, then such remaining assets
shall be distributed ratably to the holders of Common Stock.
(C) In the event the Corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the Adjustment Number
in effect immediately prior to such event shall be adjusted by
multiplying such Adjustment Number by a fraction the numerator of which
is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash and/or any other property,
then in any such case the shares of Series A Junior Participating
Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as
the case may be, into which or for which each share of Common Stock is
changed or exchanged. In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the amount set forth
in the preceding sentence with respect to the exchange or change of
shares of Series A Junior Participating Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares
of Common Stock that were outstanding immediately prior to such event.
Section 8. No Redemption or Conversion. The shares of
Series A Junior Participating Preferred Stock shall not be
redeemable or convertible into any other securities of the
Corporation.
Section 9. Ranking. The Series A Junior Participating Preferred
Stock shall rank junior to all other series of the Corporation's Preferred
Stock as to the payment of dividends and the distribution of assets,
unless the terms of any such series shall provide otherwise.
Section 10. Amendment. In the event shares of Series A Junior
Participating Preferred Stock are outstanding, the Articles of
Incorporation of the Corporation shall not be further amended in any
manner which would materially alter or change the powers, preferences or
special rights of the Series A Junior Participating Preferred Stock so as
to affect them adversely without the affirmative vote of the holders of
two-thirds or more of the outstanding shares of Series A Junior
Participating Preferred Stock, voting separately as a class.
Section 11. Fractional Shares. Series A Junior Participating
Preferred Stock may be issued in fractions of a share which shall entitle
the holder, in proportion to such holders fractional shares, to exercise
voting rights, receive dividends, participate in distributions and to have
the benefit of all other rights of holders of Series A Junior
Participating Preferred Stock.
RESTATED ARTICLES OF INCORPORATION
HUGHES SUPPLY, INC.
(January 24, 1989)
We, the undersigned, hereby certify that the following Restated
Articles of Incorporation of Hughes Supply, Inc. were duly adopted by the
Corporation's Board of Directors at a meeting held on January 24, 1989,
and that such Restated Articles of Incorporation only restate and
integrate and do not further amend the provisions of the Corporation's
Articles of Incorporation as heretofore amended and there is no
discrepancy between the Corporation's Articles of Incorporation as
heretofore amended and the provisions of these Restated Articles of
Incorporation and the omission of matters of historical interest.
ARTICLE I
The name of this Corporation shall be:
HUGHES SUPPLY, INC.
ARTICLE II
The general nature of business to be transacted by this Corporation
is:
Section A. To engage in every aspect and phase of the business of
buying, selling, distributing, handling and storing all types of
electrical, plumbing, heating and air conditioning, industrial and
utilities supplies, fixtures and hardware, tools and contractors'
supplies.
Section B. To manufacture, purchase, or otherwise acquire, and to
own, mortgage, pledge, sell, assign, transfer, or otherwise dispose of,
and to invest in, trade in, deal in and with, goods, wares, merchandise,
real and personal property, and services, of every class, kind and
description, except that it is not to conduct a banking, safe deposit,
trust, insurance, surety, express, railroad, canal, telegraph, telephone
or cemetery company, a building and loan association, mutual fire
insurance association, cooperative association, fraternal benefits
society, state fair or exposition.
Section C. To conduct business in, have one or more offices in, and
buy, hold, mortgage, sell, convey, lease or otherwise dispose of real and
personal property, including franchises, patents, copyrights, trademarks,
licenses, in the State of
Florida, and in all other States and Countries.
Section D. To contract debts and borrow money, issue and sell or
pledge bonds, debentures, notes and other evidences of indebtedness, and
execute such mortgages, transfers of corporate property or other
instruments to secure the payment of corporate indebtedness as required.
Section E. To purchase the corporate assets of any other corporation
and engage in the same or other character of business.
Section F. To guarantee, endorse, purchase, hold, sell, transfer,
mortgage, pledge or otherwise acquire or dispose of the shares of the
capital stock of, or any bonds, securities, or other evidences of
indebtedness created by any other corporation of the State of Florida or
any other state or government, and while owner of such stock to exercise
all the rights, powers and privileges of ownership, including the right
to vote such stock.
ARTICLE III
Section A. The maximum number of shares of all classes of stock
which this Corporation is authorized to issue or to have outstanding at
any time shall be 20,000,000 shares, which shall be divided into classes
as follows:
(1) Not more than 10,000,000 shares of Common Stock of $1.00
par value per share (which shall be designated "Common Stock"); and
(2) Not more than 10,000,000 shares of Preferred Stock of no
par value per share (which shall be designated "Preferred Stock").
Section B. Each holder of Common Stock shall have one vote per share
of such stock held, upon the payment of the consideration fixed for the
issuance of said stock, whether such payment is made in money or in
property to be exchanged therefor at a reasonable valuation. Said stock
shall be fully paid and nonassessable.
Section C. Holders of Common Stock shall not have preemptive rights
to purchase additional shares of Common Stock or other securities of the
Corporation whether or not such stock or other securities are issued for
cash. Holders of securities other than Common Stock shall not have any
preemptive or other right to subscribe for, or right of conversion into
Common Stock, Preferred Stock, or other stock or securities of the
Corporation, except such rights, if any, as may be expressly granted by
the Board of Directors.
Section D. The designations, powers, preferences, and rights, and
the qualifications, limitations, or restrictions of the Preferred Stock
shall be as follows:
Dividends on the outstanding shares of Preferred Stock shall be
declared and paid or set apart for payment before any dividends shall be
declared and paid or set apart for payment on the outstanding shares of
Common Stock with respect to the same quarterly period. Dividends on any
shares of Preferred Stock shall be cumulative only if and to the extent
determined by resolution of the Board of Directors, as provided below.
In the event of any liquidation, dissolution, or winding up of the affairs
of the Corporation, whether voluntary or involuntary, the outstanding
shares of Preferred Stock shall have preference and priority over the
outstanding shares of Common Stock for payment of the amount, if any, to
which shares of each outstanding series of Preferred Stock may be entitled
in accordance with the terms and rights thereof and each holder of
Preferred Stock shall be entitled to be paid in full such amount, or have
a sum sufficient for the payment in full set aside, before any such
payments shall be made to the holders of Common Stock.
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 such voting powers and with such designations,
preferences and relative participating, optional or other rights,
qualifications, limitations or restrictions, as shall be stated and
expressed in the resolution or resolutions providing for the issue thereof
adopted by the Board of Directors, and as are not stated and expressed in
these Articles of Incorporation or any amendment thereto or prohibited by
law, including the following:
(1) The distinctive designation of such series and the number
of shares which shall constitute such series, which number may be
increased (except where otherwise provided by the Board of Directors in
creating such series) or decreased (but not below the number of shares
thereof then outstanding) from time to time by the Board of Directors; and
(2) The rate or manner of payment of dividends on shares of
each such series, including the dividend rate, date of declaration and
payment, whether dividends shall be cumulative, and the conditions upon
which and the date from which such dividends shall be cumulative; and
(3) Whether the shares of such series can be redeemed, the time
or times when, and the price or prices at which, shares of such series
shall be redeemable, and the terms and conditions of redemption; and
(4) The amount payable on shares of such series and the rights
of holders of such shares in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the Corporation;
and
(5) The sinking fund provisions, if any, for the redemption or
purchase of shares of such series; and
(6) The rights, if any, of the holders of shares of such series
to convert such shares into, or exchange such shares for, shares of Common
Stock, or any other securities, and the terms and conditions of such
conversion or exchange; and
(7) The voting rights, if any, whether full or limited, of the
shares of such series; provided, however, that the voting rights of such
Preferred Stock shall not exceed one vote per share thereof and no share
shall have any voting rights until the payment therefor shall have been
received by the Corporation.
Except in respect of the particulars that may be fixed by the Board
of Directors as provided above in this Article III, Section D, all shares
of Preferred Stock shall be of equal rank and shall be identical, and each
share of a series shall be identical in all respects with the other shares
of the same series. When payment of the consideration for which shares
of Preferred Stock are to be issued shall have been received by the
Corporation, such shares shall be deemed to be fully paid and
nonassessable.
The Board of Directors, pursuant to the above authorization contained
in this Section D of Article III on May 17, 1988 authorized the issuance
of Series A Junior Participating Preferred Stock as set forth in the
Resolution Establishing Series A Junior Participating Preferred Stock
which is attached to and incorporated by reference herein as Appendix A
to these Restated Articles of Incorporation.
ARTICLE IV
The amount of capital with which this Corporation shall begin
business is the sum of Five Hundred Dollars ($500.00).
ARTICLE V
This Corporation shall have perpetual existence.
ARTICLE VI
The principal office and place of business of this Corporation shall
be located at 521 West Central Boulevard, Orlando, Florida, but this
Corporation may establish and maintain its principal office, or other
offices, at other places in the United States of America, its Colonies or
dependencies, and in any foreign country as its Board of Directors may
from time to time determine.
ARTICLE VII
Section A. Number of Directors. The number of Directors of this
Corporation shall be the number from time to time fixed by the holders of
record of at least 80% of the outstanding shares of stock entitled to vote
or by the Directors in accordance with the terms and conditions of the By-
Laws, but at no time shall said number of Directors be less than three.
Section B. Term of Directors. The Directors shall be classified
with respect to the time for which they shall severally hold office by
dividing them into three classes, each consisting of as near one-third of
the whole number of Directors as practicable, and all Directors of the
Corporation shall hold office until their successors are elected and
qualified. The first such classification shall be made at the Annual
Meeting of Shareholders to be held in the year 1975. At that Annual
Meeting, the Directors shall be classified for staggered terms of 1, 2,
and 3 years, respectively, and at each successive Annual Meeting, the
successors to the class of Directors whose terms expire that year shall
be elected to hold office for the term of three years, so that the term
of office of one class of Directors shall expire each year. Any vacancy
which shall occur in a class of Directors prior to the expiration of the
term of such class may be filled by the Board of Directors for the
remainder of the full term.
Section C. Removal of Directors. Notwithstanding any other
provisions of these Articles of Incorporation, the By-Laws of the
Corporation or applicable law, the affirmative vote of the holders of
record of at least 80% of the outstanding shares of stock entitled to vote
shall be required to remove Directors of the Corporation without cause.
Section D. Amendment. Notwithstanding any other provision of the
Articles of Incorporation, the By-Laws of the Corporation or applicable
law, the affirmative vote of the holders of record of at least 80% of the
outstanding shares of stock entitled to vote shall be required (1) to
amend, modify or repeal this Article VII, (2) adopt any provision of the
Articles of Incorporation or the By-Laws of the Corporation which is
inconsistent with this Article VII, or (3) prior to the fixing by the
Board of Directors of any right or preference of any series of Preferred
Stock which is inconsistent with the provisions of this Article VII.
ARTICLE VIII
Stock certificates to replace lost or destroyed certificates shall
be issued on such basis and according to such procedures as are from time
to time provided for in the By-Laws of the Corporation.
ARTICLE IX
The names and post office addresses of the first Board of Directors
are as follows, and these Directors shall hold office for the first year
of this Corporation's existence, or until their successors shall be
elected and qualified:
Russell S. Hughes 526 Grove Park Drive, Orlando, Fla.
Harry C. Hughes 521 W. Central Avenue, Orlando, Fla.
Romania S. Hughes 816 E. Central Avenue, Orlando, Fla.
ARTICLE X
The name and post office address of each of the subscribers to these
Articles of Incorporation, and the number of shares subscribed for by each
are as follows:
Russell S. Hughes 526 Grove Park Drive, Orlando, Fla.
1 sh.
Harry C. Hughes 521 W. Central Avenue, Orlando, Fla.
1 sh.
Romania S. Hughes 816 E. Central Avenue, Orlando, Fla.
2 shs.
ARTICLE XI
These Articles of Incorporation may be amended in the manner provided
by law. Every Amendment shall be approved by the Board of Directors,
proposed by them to the stockholders, and approved at the stockholders'
meeting by a majority of the stock issued and entitled to be voted unless
all the Directors and all the stockholders sign a written statement
manifesting their intention that a certain Amendment of these Articles of
Incorporation be made.
ARTICLE XII
No plan of consolidation or merger under which the Corporation is not
the surviving constituent corporation shall be deemed approved by the
stockholders unless such plan of consolidation or merger shall be approved
by the affirmative vote of two-thirds of the total number of shares of
stock outstanding and entitled to vote. No amendment to the Articles of
Incorporation may amend or delete the requirement that two-thirds of the
total number of shares of stock outstanding and entitled to vote approve
any plan of consolidation or merger under which the Corporation is not the
surviving constituent corporation unless at a meeting duly called two-
thirds of the total number of shares of stock outstanding and entitled to
vote shall approve such amendment or deletion of such requirement.
ARTICLE XIII
Section A. Higher Vote Required for Certain Business Combinations.
In addition to any affirmative vote required by law or these Articles of
Incorporation, and except as expressly provided in Section B of this
Article XIII, the affirmative vote of the holders of two-thirds of the
then outstanding shares of capital stock of the Corporation entitled to
vote generally in the election of directors (the "Voting Stock") shall be
required for the approval or authorization of any Business Combination (as
hereinafter defined).
Section B. Exceptions to Higher Voting Requirement. The provisions
of Section A of this Article XIII shall not be applicable to any
particular Business Combination, and such Business Combination shall
require only such affirmative vote as is required by law or any other
Article of these Articles of Incorporation, if the Business Combination
shall have been approved by a majority of the directors who are
Disinterested Directors (as hereinafter defined) or if all of the
following conditions are met:
1. The aggregate amount of the cash and the Fair Market Value
(as hereinafter defined), as of the date of the consummation of the
Business Combination, of consideration other than cash to be received per
share by holders of Common Stock in such Business Combination shall be at
least equal to the higher of (i) the highest price paid for any share of
Common Stock by the Interested Shareholder (as hereinafter defined)
involved in the proposed Business Combination within the two-year period
immediately prior to the time of the first public announcement of such
proposed Business Combination (the "Announcement Date") or in the
transaction in which such person became an Interested Shareholder,
whichever price is the higher; or (ii) the Fair Market Value per share of
the Corporation's Common Stock on the Announcement Date, or on the date
on which the Interested Shareholder became an Interested Shareholder (the
"Determination Date"), whichever is higher. The price paid for any share
of Common Stock shall be the amount of cash plus the Fair Market Value of
any other consideration to be received therefor, deter-mined at the time
of payment therefor.
2. The consideration to be received by holders of a particular
class of outstanding Voting Stock (including Common Stock) shall be in
cash or in the same form as the Interested Shareholder has previously paid
for shares of such class of Voting Stock. If the Interested Shareholder
has paid for shares of any class of Voting Stock with varying forms of
consideration, the form of consideration for such class of Voting Stock
shall be either cash or the form of consideration used to acquire the
largest number of shares of such class of Voting Stock previously acquired
by it. The price determined in accordance with Paragraph 1 of this
Section B shall be subject to appropriate adjustment in the event of any
stock dividend, stock split, combination of shares or similar event.
3. After the Determination Date and prior to the consummation
of such Business Combination: (i) there shall have been (a) no reduction
in the annual rate of dividends paid on the Common Stock (except as
necessary to reflect any subdivision of the Common Stock) and no failure
to declare and pay at the regular date therefor any full dividend (whether
or not cumulative) on any outstanding Preferred Stock, except as approved
by a majority of the directors who are Disinterested Directors, and (b)
an increase in the annual rate of dividends if necessary to reflect any
reclassification (including any reverse stock split), recapitalization,
reorganization or any similar transaction which has the effect of reducing
the number of outstanding shares of stock, unless the failure so to
increase such rates is approved by a majority of the directors who are
Disinterested Directors; and (ii) such Interested Shareholder shall not
have become the beneficial owner of any additional shares of Voting Stock
without the approval of a majority of the directors who are Disinterested
Directors except as part of the transaction which results in such
Interested Shareholder becoming an Interested Shareholder or pursuant to
a stock ownership, stock option or other benefit plan maintained by the
Corporation or any of its subsidiaries generally for the officers and/or
employees of the Corporation or any of its subsidiaries.
4. After the Determination Date, such Interested Shareholder
shall not have received the benefit, directly or indirectly (except
proportionately as a stockholder), of any loans, advances, guarantees,
pledges or other financial assistance or any tax credits or other tax
advantages provided by the Corporation, whether in anticipation of or in
connection with such Business Combination or otherwise.
5. A proxy or information statement describing the
proposed Business Combination and complying with the requirements of the
Securities Exchange Act of 1934 and the rules and regulations thereunder
(or any subsequent provisions replacing such act, rules or regulations)
shall be mailed to all stockholders of the Corporation at least 30 days
prior to the consummation of such Business Combination (whether or not
such proxy or information statement is required to be mailed pursuant to
such act or subsequent provisions).
Section C. Certain Definitions. For purposes of this Article XIII:
1. The term "Business Combination" shall mean:
(i) any merger or consolidation (except a merger or
consolidation in which the Corporation is not the surviving constituent
corporation) of the Corporation or any Subsidiary (as hereinafter defined)
with or into (a) any Interested Shareholder, or (b) any other corporation
(whether or not itself an Interested Shareholder) which is, or after such
merger or consolidation would be, an Affiliate or Associate (as those
terms are defined on July 1, 1985 in Rule 12b-2 under the Securities
Exchange Act of 1934, as amended) of an Interested Shareholder;
(ii) any sale, lease, exchange, mortgage, pledge, transfer
or other disposition (in one transaction or a series of transactions) to
or with any Interested Shareholder or any Affiliate or Associate of an
Interested Shareholder of assets of the Corporation or any Subsidiary
having a fair market value in excess of 10% of the Fair Market Value of
the total consolidated assets of the Corporation as of the end of its most
recent fiscal year ending prior to the time the determination is being
made;
(iii) any sale, lease, exchange, mortgage, pledge, transfer
or other disposition (in one transaction or a series of transactions) of
all or a substantial part of the assets of an Interested Shareholder or
an Affiliate or Associate of an Interested Shareholder to the Corporation
or any Subsidiary for consideration having a Fair Market Value aggregating
$5,000,000 or more;
(iv) the issuance or transfer by the Corporation or any
Subsidiary of any securities of the Corporation or any Subsidiary to any
Interested Shareholder or any Affiliate or Associate of an Interested
Shareholder other than the issuance of securities by the Corporation or
any Subsidiary (a) upon the exercise of warrants or the conversion of
convertible securities of the Corporation or any Subsidiary which are
directly or indirectly owned by any Interested Shareholder or any
Affiliate or Associate of any Interested Shareholder, or (b) in connection
with any stock option, stock ownership or other benefit plan maintained
by the Corporation or any Subsidiary generally for the officers and/or
employees of the Corporation or any Subsidiary;
(v) the adoption of any plan or proposal for the
liquidation or dissolution of the Corporation proposed by or on behalf of
any Interested Shareholder or any Affiliate or Associate of any Interested
Shareholder; or
(vi) any reclassification or recapitalization (including
any reverse stock split) of the Corporation or a merger or consolidation
(except a merger or consolidation in which the Corporation is not the
surviving constituent corporation) of the Corporation with any Subsidiary
or a reorganization or any other transaction (whether or not with or into
or otherwise involving an Interested Shareholder) which has the effect,
directly or indirectly, of increasing the proportionate share of the
outstanding stock of any class of equity or convertible securities of the
Corporation or any Subsidiary which is directly or indirectly owned by an
Interested Shareholder or any Affiliate or Associate of an Interested
Shareholder.
2. The term "Interested Shareholder" shall mean and include
any person, corporation or other entity which is the beneficial owner,
directly or indirectly, of 10% or more of the combined voting power of the
then outstanding Voting Stock of the Corporation.
3. The term "Disinterested Director" shall mean and include
each director of the Corporation who is not himself or herself the
Interested Shareholder proposing the Business Combination or an Affiliate
or Associate of such Interested Shareholder or an officer, director or
employee of such Interested Shareholder or of an Affiliate or Associate
of such Interested Shareholder.
4. A person shall be a "beneficial owner" of any Voting Stock:
(i) which such person or any of its Affiliates or
Associates beneficially owns, directly or indirectly; or
(ii) which such person or any of its Affiliates or
Associates has (a) the right to acquire (whether such right is exercisable
immediately or only after the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion rights,
exchange rights, warrants or options, or otherwise, or (b) the right to
vote or to direct the vote pursuant to any agreement, arrangement or
understanding; or
(iii) which are beneficially owned, directly or
indirectly, by any other person with which such person or any of its
Affiliates or Associates has any agreement, arrangement or understanding
for the purpose of acquiring, holding, voting or disposing of any shares
of Voting Stock.
5. For the purposes of determining whether a person is an
Interested Shareholder pursuant to Paragraph 2 of this Section C, the
number of shares of Voting Stock deemed to be outstanding shall include
shares deemed owned through application of Paragraph 4 of this Section C
but shall not include any other shares of Voting Stock which may be
issuable to other persons pursuant to any agreement, arrangement or
understanding, or upon exercise of conversion rights, warrants or options,
or otherwise.
6. The term "Fair Market Value" shall mean: (i) in the case
of stock, the highest closing sale price during the 30-day period
immediately preceding the date in question of a share of such stock on the
principal United States Securities Exchange registered under the
Securities Exchange Act of 1934 on which such stock is listed, or, if such
stock is not listed on any such exchange, the highest closing bid
quotation with respect to a share of such stock during the 30-day period
preceding the date in question on the National Association of Securities
Dealers, Inc. Automated Quotations System or any system then in use, or
if no such quotations are available, the fair market value on the date in
question of a share of such stock as determined by a majority of the
directors who are Disinterested Directors in good faith; and (ii) in the
case of stock of any class of securities not traded on any securities
exchange or in the over-the-counter market or in the case of property
other than cash or stock, the fair market value of such securities or
property on the date in question as determined by a majority of the
directors who are Disinterested Directors in good faith.
7. The term "Subsidiary" shall mean any corporation of which
a majority of the voting shares is owned, directly or indirectly, by the
Corporation.
8. In the event of any Business Combination in which the
Corporation survives, the phrase "consideration to be received" as used
in Paragraphs 1 and 2 of Section B shall include the shares of Common
Stock and/or the shares of any other class of outstanding Voting Stock
retained by the holders of such shares.
Section D. Powers of the Board of Directors. The Board of Directors
acting by a majority of the directors who are Disinterested Directors
shall have the power and duty to determine for the purpose of this Article
XIII on the basis of information known to them after reasonable inquiry,
all facts necessary to determine the applicability of the various
provisions of this Article XIII including, (1) whether a person is an
Interested Shareholder, (2) the number of shares of Voting Stock
beneficially owned by any person, (3) whether a person is an Affiliate or
Associate of another, and (4) whether the requirements of Section B have
been met with respect to any Business Combination, and the good faith
determination of a majority of the directors who are Disinterested
Directors shall be conclusive and binding for all purposes of this Article
XIII.
Section E. No Effect on Fiduciary Obligations. Nothing contained
in this Article XIII shall be construed to relieve any Interested
Shareholder from any fiduciary obligation imposed by lain.
Section F. Severability. In the event any provision (or any part
thereof) of this Article XIII should be determined to be invalid,
prohibited or unenforceable for any reason, the remaining provisions, and
parts thereof, shall remain in full force and effect and enforceable
against the Corporation and its shareholders, including any Interested
Shareholder, to the fullest extent permitted by law.
Section G. Amendment. Notwithstanding any other provision of the
Articles of Incorporation, the By-Laws of the Corporation or applicable
law, the affirmative vote of two-thirds of the votes of then outstanding
Voting Stock, voting together as a single class, shall be required (1) to
amend, modify or repeal this Article XIII, (2) adopt any provision of the
Articles of Incorporation or By-Laws which is inconsistent with this
Article XIII, or (3) prior to the fixing by the Board of Directors of any
right or preference of any series of Preferred Stock which is inconsistent
with the provisions of this Article XIII.
ARTICLE XIV
Notwithstanding any other provision of the Articles of Incorporation,
the By-Laws of the Corporation or applicable law, (a) any special meeting
of the stockholders called by a stockholder or stockholders must be called
by a request in writing submitted by the holder or holders of at least 80%
of the outstanding shares of stock entitled to vote, (b) the stockholders
of the Corporation shall not be permitted to take action by means of
written consents, and (c) the affirmative vote of at least 80% of the
outstanding shares of stock entitled to vote shall be required (i) to
amend, modify or repeal this Article XIV, (ii) adopt any provision of the
Articles of Incorporation or By-Laws of the Corporation which is
inconsistent with this Article XIV, or (iii) prior to the fixing by the
Board of Directors of any right or preference of any series of Preferred
Stock which is inconsistent with the provisions of this Article XIV.
Upon the filing of these Restated Articles of Incorporation of the
Florida Department of State, the Corporation's original Articles of
Incorporation as heretofore amended, shall be superseded, and thereafter
these Restated Articles of Incorporation shall in accordance with Section
607.194 of the Florida General Corporation Act, be the Articles of
Incorporation of the Corporation.
Witness our hands and seals and the Corporate Seal of said
Corporation this 31st day of January, 1989.
s/David H. Hughes
DAVID H. HUGHES, President
Hughes Supply, Inc.
s/Robert N. Blackford
ROBERT N. BLACKFORD, Secretary
Hughes Supply, Inc.
(CORPORATE SEAL)
STATE OF FLORIDA )
)
COUNTY OF ORANGE )
Personally appeared before me, the undersigned authority, David H.
Hughes, well known to me and known to me to be the President of Hughes
Supply, Inc., and after having been duly sworn, he did depose and say that
the foregoing Restated Articles of Incorporation were duly approved by the
Board of Directors and stockholders of the Corporation as stated.
Witness my hand and seal in the County and State aforesaid this 31st
day of January, 1989.
s/Eileen G. Weisenbarger
NOTARY PUBLIC
My Commission Expires: July 29, 1991
Notary Public, State of Florida
<PAGE>
APPENDIX A
TO
SECOND RESTATED ARTICLES OF INCORPORATION
RESOLUTION ESTABLISHING
SERIES A JUNIOR PARTICIPATING
PREFERRED STOCK
of
HUGHES SUPPLY, INC.
RESOLVED, that pursuant to the authority vested in this Board of
Directors in accordance with the provisions of this Corporation's Articles
of Incorporation, a series of Preferred Stock of this Corporation be, and
it hereby is, created, and that the designation and amount thereof and the
voting powers, preferences and relative, participating, optional and other
special rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
Section 1. Designation and Amount. The shares of such series shall
be designated as "Series A Junior Participating Preferred Stock" and the
number of shares constituting such series shall be 300,000.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of
any shares of any series of Cumulative Preferred Stock ranking prior and
superior to the shares of Series A Junior Participating Preferred Stock
with respect to dividends, the holders of shares of Series A Junior
Participating Preferred Stock shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally available for
the purpose, quarterly dividends payable in cash on the third Friday in
February, May, August and November of each year (each such date being
referred to herein as a "Quarterly Dividend Payment Date"), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Series A Junior Participating Preferred
Stock, in an amount per share (rounded to the nearest cent) equal to the
greater of (a) $1.25 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all
cash dividends, and 100 times the aggregate per share amount (payable in
kind) of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock, par value $1.00 per share, of the
Corporation (the "Common Stock") since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of a share
of Series A Junior Participating Preferred Stock. In the event the
Corporation shall at any time after May 17, 1988 (the "Rights Declaration
Date") (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then
in each such case the amount to which holders of shares of Series A Junior
Participating Preferred Stock were entitled immediately prior to such
event under clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the number
of shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution
on the Series A Junior Participating Preferred Stock as provided in
paragraph (A) above immediately after it declares a dividend or
distribution on the Common Stock (other then a dividend payable in shares
of Common Stock); provided that, in the event no dividend or distribution
shall have been declared on the Common Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend
Payment Date, a dividend of $1.25 per share on the Series A Junior
Participating Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Junior Participating Preferred Stock from
the Quarterly Dividend Payment Date next preceding the date of issue of
such shares of Series A Junior Participating Preferred Stock, unless the
date of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the
date of issue is a Quarterly Dividend Payment Date or is a date after the
record date for the determination of holders of shares of Series A Junior
Participating Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which events
such dividends shall begin to accrue and be cumulative from such Quarterly
Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the shares of Series A Junior Participating
Preferred Stock in an amount less than the total amount of such dividends
at the time accrued and payable on such shares shall be allocated pro rata
on a share-by-share basis among all such shares at the time outstanding.
The Board of Directors may fix a record date for the determination of
holders of shares of Series A Junior Participating Preferred Stock
entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be no more than 30 days prior to the date
fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Junior
Participating Preferred Stock shall have the following voting rights:
(A) Each share of Series A Junior Participating Preferred
Stock shall entitle the holder thereof to 1 vote on all matters
submitted to a vote of the stockholders of the Corporation.
(B) Except as otherwise provided herein or by law, the
holders of shares of Series A Junior Participating Preferred Stock end
the holders of shares of Common Stock shall vote together as one class
on all matters submitted to a vote of stockholders of the Corporation.
(C) Holders of Series A Junior Participating Preferred Stock
shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of
Common Stock as set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Junior Participating Preferred
Stock as provided in Section 2 are in arrears, thereafter and until all
accrued end unpaid dividends and distributions, whether or not declared,
on shares of Series A Junior Participating Preferred Stock outstanding
shall have been paid in full, the Corporation shall not
(i) declare or pay dividends on, make any
other distributions on, or redeem or purchase or otherwise
acquire for consideration, any shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Junior Participating Preferred
Stock;
(ii) declare or pay dividends on, or make
any other distributions on, any shares of stock ranking on
a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Junior
Participating Preferred Stock, except dividends paid
ratably on the Series A Junior Participating Preferred
Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts
to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise
acquire for consideration shares of any stock ranking on
a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Junior
Participating Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise
acquire shares of any such parity stock in exchange for
shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation
or winding up) to the Series A Junior Participating
Preferred Stock;
(iv) purchase or otherwise acquire for
consideration any shares of Series A Junior Participating
Preferred Stock, or any shares of stock ranking on a
parity with the Series A Junior Participating Preferred
Stock, except in accordance with a purchase offer made in
writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms
as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights
and preferences of the respective series and classes,
shall determine in good faith will result in fair and
equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation could,
under paragraph (A) of this Section 4, purchase or otherwise acquire
such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Junior
Participating Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and cancelled
promptly after the acquisition thereof. All such shares shall upon
their cancellation become authorized but unissued shares of
Preferred Stock and may be reissued as part of a new series of
Preferred Stock to be created by resolution or resolutions of the
Board of Directors, subject to the conditions and restrictions on
issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. (A) Upon
any liquidation (voluntary or otherwise), dissolution or winding up
of the Corporation, no distribution shall be made to the holders of
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock unless, prior thereto, the holders of
shares of Series A Junior Participating Preferred Stock shall have
received $100 per share, plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the
date of such payment (the "Series A Liquidation Preference").
Following the payment of the full amount of the Series A Liquidation
Preference, no additional distributions shall be made to the holders
of shares of Series A Junior Participating Preferred Stock unless,
prior thereto, the holders of shares of Common Stock shall have
received an amount per share (the "Common Adjustment") equal to the
quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 100 (as appropriately adjusted as set forth in
subparagraph C below to reflect such events as stock splits, stock
dividends and recapitalizations with respect to the Common Stock)
(such number in clause (ii), the "Adjustment Number"). Following the
payment of the full amount of the Series A Liquidation Preference
and the Common Adjustment in respect of all outstanding shares of
Series A Junior Participating Preferred Stock and Common Stock,
respectively, holders of Series A Junior Participating Preferred
Stock and holders of shares of Common Stock shall receive their
ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with respect
to such Preferred Stock and Common Stock, on a per share basis,
respectively.
(B) In the event, however, that there are not sufficient
assets available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all other series of
preferred stock, if any, which rank on a parity with the Series A
Junior Participating Preferred Stock, then such remaining assets shall
be distributed ratably to the holders of such parity shares in
proportion to their respective liquidation preferences. In the event,
however, that there are not sufficient assets available to permit
payment in full of the Common Adjustment, then such remaining assets
shall be distributed ratably to the holders of Common Stock.
(C) In the event the Corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the Adjustment Number
in effect immediately prior to such event shall be adjusted by
multiplying such Adjustment Number by a fraction the numerator of which
is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash and/or any other property,
then in any such case the shares of Series A Junior Participating
Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as
the case may be, into which or for which each share of Common Stock is
changed or exchanged. In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the amount set forth
in the preceding sentence with respect to the exchange or change of
shares of Series A Junior Participating Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares
of Common Stock that were outstanding immediately prior to such event.
Section 8. No Redemption or Conversion. The shares of
Series A Junior Participating Preferred Stock shall not be
redeemable or convertible into any other securities of the
Corporation.
Section 9. Ranking. The Series A Junior Participating Preferred
Stock shall rank junior to all other series of the Corporation's Preferred
Stock as to the payment of dividends and the distribution of assets,
unless the terms of any such series shall provide otherwise.
Section 10. Amendment. In the event shares of Series A Junior
Participating Preferred Stock are outstanding, the Articles of
Incorporation of the Corporation shall not be further amended in any
manner which would materially alter or change the powers, preferences or
special rights of the Series A Junior Participating Preferred Stock so as
to affect them adversely without the affirmative vote of the holders of
two-thirds or more of the outstanding shares of Series A Junior
Participating Preferred Stock, voting separately as a class.
Section 11. Fractional Shares. Series A Junior Participating
Preferred Stock may be issued in fractions of a share which shall entitle
the holder, in proportion to such holders fractional shares, to exercise
voting rights, receive dividends, participate in distributions and to have
the benefit of all other rights of holders of Series A Junior
Participating Preferred Stock.
COMPOSITE BY-LAWS
-of-
HUGHES SUPPLY, INC.
(As Amended May 24, 1994)
ARTICLE I
Stock
1. Certificates of Stock shall be issued in numerical order
from the stock certificate book, and be signed by the President or
the Vice-president, and the Treasurer or an Assistant Treasurer, or
the Secretary or an Assistant Secretary, and sealed with the seal
of the Corporation. The seal may be facsimile, engraved or
printed. If such certificate is signed by (a) a transfer agent or
an assistant transfer agent, other than the Corporation itself, or
by (b) a transfer clerk acting on behalf of the Corporation and a
registrar, the signature of any of those officers named herein may
be facsimile. In case any officer who signed, or whose facsimile
signature has been used on any certificate shall cease to be such
officer for any reason before the certificate has been delivered by
the Corporation, such certificate may nevertheless be adopted by
the Corporation and issued and delivered as though the person who
signed it or whose facsimile signature has been used thereon had
not ceased to be such officer. Subscription warrants, scrip for
fractional shares and similar certificates may be issued from time
to time and be signed by the President, a Vice President or the
Treasurer, and, where otherwise required, sealed with the seal of
the Corporation. The signature of the signing officer, and the
seal may be facsimile, engraved or printed.
2. Transfer of Stock shall be made only on the books of the
Corporation, in person or by attorney, upon surrender of the
certificate evidencing the stock sought to be transferred, properly
endorsed or assigned; the certificate so surrendered shall be
cancelled as and when a new certificate or certificates are issued.
3. Lost Certificates. The Board of Directors may direct a
new certificate or certificates to be issued in place of any
certificate or certificates theretofore issued by the Corporation
alleged to have been lost or destroyed, upon the making of an
affidavit of that fact by the person claiming the certificate of
stock to be lost or destroyed. When authorizing such issue of a
new certificate or certificates, the Board of Directors may, in its
discretion and as a condition precedent to the issuance thereof,
require the owner of such lost or destroyed certificate or
certificates, or his legal representative, to advertise the same in
such manner as it shall require and/or to give the Corporation a
bond in such sum as it may direct as indemnity against any claim
that may be made against the Corporation with respect to the
certificate alleged to have been lost or destroyed.
4. Record Date, Subsequent Transfers. The Board of
Directors shall have power to fix in advance a date, not exceeding
sixty days preceding the date of any meeting of stockholders or the
date for the payment of any dividends or the date for the allotment
of any rights or the date when any change or conversion or exchange
of stock shall go into effect or a date in connection with the
obtaining of any consent of stockholders for any purpose, as a
record date for the determination of the stockholders entitled to
notice of, and to vote at, any such meeting and any adjournment
thereof or to receive payment of any such dividend or to any such
allotment of rights or to exercise rights in respect of any such
change, conversion or exchange of stock or to give any such
consent, and, in such case, such stockholders, and only such
stockholders, as shall be stockholders on the record date so fixed
shall be entitled to notice of, and vote at, such meeting and any
adjournment thereof or to receive payment of any such dividend or
to receive such allotment of rights or to exercise such rights or
to give such consent, as the case may be, notwithstanding any
transfer of any stock on the books of the Corporation after any
such record date, fixed as aforesaid.
ARTICLE II
Stockholders
1. The Annual Meeting of this corporation shall be held at
ten o'clock a.m. on the third Tuesday of May of each year, if not
a legal holiday, and if a legal holiday, then the day following,
commencing with the year A.D. 1970. Each Annual Meeting shall be
held at the principal office of the Corporation unless some other
place in or out of the State of Florida is designated by the Board
of Directors three weeks or more before the day of such Meeting.
2. Special Meetings of the stockholders may be called at any
time by resolution of the Board of Directors or by the President
and may be called at any time by a request in writing submitted by
the holder or holders of at least 801 of the out-standing shares of
stock entitled to vote. Such request must state the purpose of the
meeting.
3. Written Consents. The stockholders of the Corporation
shall not be permitted to take action by means of written
consents.
4. Notice of Stockholders' Meetings of the Corporation shall
be given by mailing a written notice of such meeting, signed by the
President, or a Vice President or the Secretary or an Assistant
Secretary, of the Corporation, to each stockholder of record
entitled to vote at such meeting at his address as it appears on
the records of the Corporation not less than ten (10) nor more than
sixty (60) days before the date set for such meeting. The notice
shall state the purpose of the meeting and the time and place it is
to be held. Notice mailed to a stockholder in accordance with the
provisions of this By-Law shall be deemed sufficient for said
meeting and if any stockholder shall transfer any of his stock
after notice, it shall not be necessary to notify the transferee.
Any meeting of stockholders may be held either within or without
the State of Florida. Any stockholder may waive notice of any
meeting either before, or at, or after, the meeting. When
stockholders who hold four-fifths (4/5) of the voting stock of the
Corporation having the right and entitled to vote at any meeting,
shall be present in person, or by proxy, at any meeting, however
called or notified, and shall sign a written consent thereto on the
record of the meeting, the acts of such meeting shall be as valid
as if legally called and notified.
5. A Quorum at any meeting of the stockholders shall consist
of a majority of the stock of the Corporation entitled to vote
thereat represented in person or by proxy, and a majority of such
quorum shall decide any question that may come before the meeting;
provided, however, that:
(i) No plan of consolidation or merger under which the
Corporation is not the surviving constituent corporation shall be
deemed approved by the stockholders unless such plan of
consolidation or merger shall be approved by the affirmative vote
of two-thirds of the total number of shares of stock outstanding
and entitled to vote; and
(ii) No amendment to the Articles of Incorporation may
amend or delete the requirement that two-thirds of the total number
of shares of stock outstanding and entitled to vote approve any
plan of consolidation or merger under which the Corporation is not
the surviving constituent corporation, unless at a meeting duly
called two-thirds of the total number of shares of stock
outstanding and entitled to vote shall approve such amendment or
deletion of such requirement; and
(iii) In addition to any affirmative vote required by
law or the Articles of Incorporation, and except as expressly
provided in Section 8 of Article XIII of the Articles of
Incorporation ("Article XIII"), the affirmative vote of, the
holders of two-thirds of the then outstanding shares of capital
stock of the Corporation entitled to vote generally in the election
of directors shall be required for the approval or authorization of
any Business Combination (as defined in Article XIII). The
provisions of Section A of Article XIII shall not be applicable to
any particular Business Combination, and such Business Combination
shall require only such affirmative vote as is required by law or
any other Article of the Articles of Incorporation, if the Business
Combination shall have been approved by a majority of the directors
who are Disinterested Directors (as defined in Article XIII), or if
all of the conditions of Section B of Article XIII are met; and
(iv) Notwithstanding any other provision of the By-Laws
of the Corporation or applicable law, the affirmative vote of two-
thirds of the votes of the then outstanding Voting Stock (as
defined in the Articles of Incorporation), voting together as a
single class, shall be required (1) to amend, modify or repeal
Article XIII of the Articles of Incorporation ("Article XIII"), (2)
adopt any provision of the Articles of Incorporation or By-Laws
which is inconsistent with Article XIII, or (3) prior to the fixing
by the Board of Directors of any right or preference of any series
of Preferred Stock which is inconsistent with the provisions of
Article XIII; and
(v) In the event the number of directors of the
Corporation shall be fixed by the stockholders in accordance with
Section A of Article XII of the Articles of Incorporation, such
number shall be the number fixed by the holders of record of at
least 80% of the outstanding shares of stock entitled to vote; and
(vi) Notwithstanding any other provision of the By-Laws
of the Corporation or applicable law, the affirmative vote of the
holders of record of at least 80% of the outstanding shares of
stock entitled to vote shall be required to remove directors of the
Corporation without cause; and
(vii) Notwithstanding any other provision of the By-Laws
of the Corporation or applicable law, the affirmative vote of the
holders of record of at least 80% of the outstanding shares of
stock entitled to vote shall be required (1) to amend, modify or
repeal Article VII or Article XIV of the Articles of Incorporation
("Article VII or XIV"), (2) adopt any provision of the Articles of
Incorporation or the By-Laws of the Corporation which is
inconsistent with Article VII or XIV, or (3) prior to the fixing by
the Board of Directors of any right or preference of any series of
Preferred Stock which is inconsistent with the provisions of
Article XII or XIV.
In the absence of a quorum, a majority of the shares present
in person or by proxy and entitled to vote may adjourn any meeting
from time to time until a quorum shall be present, any business may
be transacted which might have been transacted at the meeting as
originally called unless otherwise provided by statute, and no
notice of an adjourned meeting need be given.
6. Judges. At every meeting of stockholders the vote shall
be conducted by two or more judges appointed for that purpose by
the Board of Directors; and all questions respecting the
qualification of voters, the validity of the proxies and the
acceptance and rejection of votes shall be decided by such judges.
Before acting at any meeting, the judges shall be sworn faithfully
to execute their duties, with strict impartiality and according to
the best of their ability. If fewer than two judges appointed by
the Board of Directors to act at any meeting shall be present and
willing to act at such meeting, the stockholders present at the
meeting in person or by proxy may, by a per capita vote, appoint
one or more judges so to act.
ARTICLE III
Directors
1. Powers. The business and property of the Corporation
shall be managed by a Board of Directors, all of whom shall be of
full age and at least one of whom shall be a citizen of the United
States, and such Board of Directors shall have full control over
the affairs of the Corporation and shall be authorized to exercise
all of its corporate powers unless otherwise provided in these By-
Laws.
2. Number and Term of Directors. The Board of Directors
shall consist of three or more directors, the exact number to be
fixed and determined from time to time by resolution of a majority
of the full Board of Directors or by holders of record of at least
80% of the outstanding shares of stock entitled to vote at any
meeting thereof. The directors shall be classified with respect to
the time for which they shall severally hold office by dividing
them into three classes, each consisting of as near one-third of
the whole number of Directors as practicable, and all directors of
the Corporation shall hold office until their successors are
elected and qualified. The first such classification shall be made
at the Annual fleeting of the Stockholders to be held in the year
1975. At that Annual Meeting, the directors shall be classified
for staggered terms of 1, 2 and 3 years, respectively, and at each
successive Annual Meeting the successors to the class of directors
whose terms expire that year shall be elected to hold office for
the term of 3 years, so that the term of office of one class of
directors shall expire in each year. Any vacancy which shall occur
in a class of directors prior to the expiration of the term of such
class may be filled by the Board of Directors. A director elected
to fill a vacancy shall hold office only until the next election of
directors by the stockholders. An increase in the number of
directors shall be deemed to create vacancies for the purpose of
this section.
3. Election of Directors. At the Annual Meeting of
Stockholders, directors shall be elected by a plurality of the
votes cast at such election. At the election of directors, each
shareholder shall have the right to vote the number of shares owned
by him for as many persons as there are directors to be elected.
There shall be no cumulative voting. Nominations for election of
the Board of Directors may be made by the Board of Directors, or by
any stockholder of any outstanding class of capital stock of the
Corporation entitled to vote for the election of directors.
Nominations, other than those made by the existing Board of
Directors, shall be made in writing and shall be delivered or
mailed to the President of the Corporation not less than 14 days
nor more than 50 days prior to any meeting of stockholders called
for the election of directors; provided, however, that if less than
twenty-one days' (21) notice of the meeting is given to
stockholders such nomination shall be mailed or delivered to the
President of the Corporation not later than the close of business
on the 7th day following the day on which the notice of meeting was
mailed. Such nomination and notification shall contain the
following information to the extent known to the notifying
stockholder:
(i) The names and addresses of the proposed nominee or
nominees;
(ii) The principal occupation of each proposed nominees;
(iii) The total number of shares that to the knowledge of
the notifying or nominating shareholders will be voted for each of
the proposed nominees;
(iv) The name and residence address of each notifying or
nominating shareholder; and
(v) The number of shares owned by the notifying or
nominating shareholder.
Nominations not made in accordance herewith may, in his discretion
be disregarded by the chairman of the meeting, and upon his
instructions, the judges of election may disregard all votes cast
for each such nomination.
4. Place of Meeting. Meetings of the Board of Directors or
of any committee thereof may be held either within or without the
State of Florida.
5. Organization Meetings of the Board of Directors shall be
held as soon as practicable each year after the annual election of
directors for the purpose of organization, election of officers and
the transaction of other business. No notice of such meeting shall
be required. Such organization meeting may, however, be held at
any other time or place which shall be specified in a notice given,
as hereinafter provided, for special meetings of the Board, or in
a consent and waiver of notice thereof signed by all of the
directors.
6. Regular Meetings. The Board of Directors may from tine
to time, by resolution, appoint the time and place for holding
regular meetings of the Board, if by it deemed advisable, and such
regular meetings shall thereupon be held at the time and place so
appointed, without the giving of any notice with regard thereto.
In case the day appointed for a regular meeting shall fall upon a
Saturday or legal holiday in the State of Florida, such meeting
shall be held on the next succeeding day not a Saturday or legal
holiday in Florida, at the regularly appointed hour. Except as
otherwise provided in the By-Laws, any and all business may be
transacted at any regular meeting.
7. Special Meetings. Special meetings of the Board of
Directors shall be held whenever called by the Chairman, the
President, or by any two of the directors. Notice to a director of
any such meeting may be given in writing, by mailing the same to
the residence or place of business of the director as shown on the
books of the Corporation not later than two days before the day on
which the meeting is to be held, or may be given by sending the
same to him at such place by telegraph or by delivering the same to
him personally or leaving the same for him at his place of business
or by giving the same to him personally or by telephone, not later
than the day before such day of meeting. Notice of any meeting of
the Board need not, however, be given to any director, if waived by
him in writing (including telegram, cablegram or radiogram) or if
he shall be present at the meeting; and any meeting of the Board of
Directors shall be a legal meeting without any notice thereof
having been given, if all members shall be present thereat. Except
as otherwise provided in the By-Laws or as may be indicated in the
notice thereof, any and all business may be transacted at any
special meeting.
8. Quorum and Manner of Acting. Except as otherwise
provided in the By-Laws, a majority of the directors in office at
the time of any meeting of the Board of Directors, but not less
than two directors, shall constitute a quorum for the transaction
of business; and, except as otherwise required by statute or by the
Certificate of Incorporation or any amendment thereto, or by the
By-Laws, the act of a majority of the directors present at any such
meeting at which a quorum is present shall be the act of the Board
of Directors. In the absence of a quorum, a majority of the
directors present may adjourn any meeting, from time to time, until
a quorum is present. No notice of any adjourned meeting need be
given.
9. Business Combination. The Board of Directors acting by
a majority of the directors who are Disinterested Directors (as
defined in Article XIII of the Articles of Incorporation) ("Article
XIII") shall have the power and duty to determine for the purpose
of Article XIII on the basis of information known to them after
reasonable inquiry, all facts necessary to determine the
applicability of the various provisions of Article XIII, including
(1) whether a person is an Interested Shareholder (as defined in
Article XIII), (2) the number of shares of Voting Stock (as defined
in Article XIII) beneficially owned by any person, (3) whether a
person is an Affiliate or Associate (as defined in Article XIII) of
another, and (4) whether the requirements of Section 8 of Article
XIII have been met with respect to any Business Combination (as
defined in Article XIII), and the good faith determination of a
majority of the directors who are Disinterested Directors shall be
conclusive and binding for all purposes of Article XIII.
10. Directors' Compensation. The Board of Directors shall
have authority to determine from time to time the amount, if any,
of compensation and expenses which shall be paid to its members for
attendance at meetings of the Board or of any committee of the
Board. The Board of Directors shall also have power, in its
discretion, to provide for and to pay to directors rendering
services to the Corporation not ordinarily rendered by directors,
as such, special compensation appropriate to the value of such
services, as determined by the Board from time to time.
11. Resignations. Any director of the Corporation may resign
at any time either by oral tender of resignation at any meeting of
the Board or by giving written notice thereof to the Chairman, the
President, or the Secretary. Such resignation shall take effect at
the time specified therefor; and, unless otherwise specified with
respect thereto, the acceptance of such resignation shall not be
necessary to make it effective.
12. Removal of Directors. Any director may be removed at any
time for cause by the affirmative vote of the holders of record of
a majority of the outstanding shares of stock entitled to vote, or
without cause by the affirmative vote of the holders of record of
at least 80% of the outstanding shares of stock entitled to vote,
at a meeting of the stockholders called for the purpose; and the
vacancy in the Board caused by such removal may be filled by the
stockholders or, if the stockholders shall have failed to do so,
such vacancy may be filled by the Board of Directors at any meeting
by the affirmative vote of a majority of the remaining directors.
ARTICLE IV
Officers, Employees and Agents
1. Officers, Term of Office, Vacancies, Removal. The Board
of Directors shall elect a President, one or more Vice Presidents
of such precedence, rank or additional designation, if any, among
the same as the Board of Directors may provide, a Secretary and a
Treasurer, such election to take place, if practicable, at the
Organization Meeting of the Board of Directors each year, and such
officers shall hold office, subject to removal by the Board, until
the Organization Meeting of the Board of Directors in the next
subsequent year and until their respective successors are elected
and qualified. In addition, the Board of Directors in its
discretion may provide for and elect a Chairman of the Board of
Directors, who may also hold the office of President, and a Vice
Chairman of the Board, who may also hold the office of Vice
President or President. The Board of Directors may appoint a
successor to fill a vacancy in any office for the remainder of the
term. The Board of Directors or the Executive Committee may, from
time to time, appoint any one or more Assistant Vice Presidents,
one or more Assistant Secretaries, one or more Assistant
Treasurers, and such other officers and agents as may appear to be
necessary or advisable in the conduct or affairs of the
Corporation; and all such officers shall hold office during the
pleasure of the Board. Any officers and agents may be removed at
any time, for or without cause, by the Board of Directors, or, in
case any such officer or agent may be appointed pursuant to these
By-Laws by the Executive Committee, he may be removed by the
Executive Committee.
2. Chairman. The Chairman shall be the chief executive
officer of the Corporation and, under the direction of the Board of
Directors, shall have general executive powers in the management
and direction of the business and affairs of the Corporation, as
well as the specific powers conferred by these By-Laws or by the
Board of Directors. The Chairman shall preside, when present, at
all meetings of the stockholders, the Board of Directors and the
Executive Committee.
3. President. The President shall be the chief operating
and administrative officer of the Corporation and, under the
direction of the Board of Directors, shall, subject to the
Chairman, have direct general supervision over the management,
business, properties and affairs of the Corporation. In the
absence of the Chairman, he shall preside at all meetings of the
stockholders, the Board of Directors and the Executive Committee.
He shall have general executive powers, including all powers
required by law to be exercised by a president of a corporation as
such, as well as the specific powers conferred by these By-Laws or
by the Board of Directors.
4. Vice President. Each Vice President shall have general
executive powers as well as the specific powers conferred by these
By-Laws. He shall also have such further powers and duties as may
from time to time be conferred upon, or assigned to, him by the
Board of Directors, the Chairman or the President.
5. Secretary. The Secretary shall attend to the giving of
notice of all meetings of stockholders and of the Board of
Directors required by these By-Laws to be given, and shall keep
true records of all proceedings thereat. Be shall have charge of
the corporate seal and shall keep and account for all books,
documents, papers and records of the Corporation, except those for
which some other officer or agent is properly accountable, and
shall generally perform all the duties usually appertaining to the
office of secretary of a corporation. In the absence of the
Secretary, an Assistant Secretary or Secretary pro tempore shall
perform his duties.
6. Treasurer. The Treasurer shall have the care and custody
of all moneys, funds and securities of the Corporation. He shall
disburse the funds of the Corporation in the manner ordered by the
Board of Directors and shall keep full and accurate accounts of
receipts and disbursements of the Corporation. He shall, whenever
required to do so, render an account of all his transactions as
Treasurer to the Board of Directors. He shall perform such other
duties as shall be assigned to him by the Board of Directors, the
Chairman or the President. In the absence of the Treasurer, his
duties shall be performed by an Assistant Treasurer or by another
officer thereunto designated by the Board of Directors, the
Chairman or the President.
7. Additional Officers; Duties and Powers. In addition to
the foregoing especially enumerated duties and powers the several
officers and agents of the Corporation, whether or not specifically
referred to in these By-Laws, shall perform such duties and
exercise such powers, in addition to those for which provision is
made in these By-Laws, as the Board of Directors or Executive
Committee may from time to time determine or as may be assigned to
them by any competent superior officer.
8. Compensation. The Board of Directors shall fix the
compensation of the Chairman and the President and of the senior
and executive Vice Presidents, if any; the compensation of all
other officers of the Corporation shall be fixed by the Board of
Directors, the Executive Committee, or the President.
ARTICLE V
Committees of the Board
1. Executive Committee; Constitution, Powers, Vacancies. The
Board of Directors may, resolution adopted by affirmative vote of
a majority of the whole Board, appoint an Executive Committee, to
consist of the Chairman and the President, ex officio, and one or
more other directors (with such alternates, if any, as may be
deemed desirable), which Executive Committee shall have and may
exercise, when the Board is not in session, all the powers of the
Board of Directors in the management of the business and affairs of
the Corporation, including the power to authorize the seal of the
Corporation to be affixed to all papers which may require it, and
also including the power, from time to time, to appoint one or more
attorneys-in-fact to act for and in representation of the
Corporation, either generally or specially, judicially or extra-
judicially, and to delegate to any such attorney or attorneys-in-
fact all or any of the powers which, in the judgment of the
Executive Committee, may be necessary, convenient or suitable for
exercise in any country or jurisdiction in the transaction of the
business of the Corporation or the defense or enforcement of its
rights, even though such powers be herein provided or directed to
be exercised by a designated officer of the Corporation; provided,
that the foregoing shall not be construed as authorizing action by
the Executive Committee with respect to any action which by these
By-Laws or by the Certificate of Incorporation or any amendment
thereto, or by statute, is required to be taken by the Board of
Directors, as such. As far as practicable, members of the
Executive Committee and their alternates (if any) shall be
appointed at the Organization Meeting of the Board in the next
subsequent year and until their respective successors are
appointed. Any vacancy in the Executive Committee may be filled by
affirmative vote of a majority of the whole Board of Directors.
2. Executive Committee; Meetings. Stated meetings of the
Executive Committee, of which no notice shall be necessary, shall
be held at such times and at such places as shall be fixed, from
time to time, by resolution adopted by the Executive Committee.
Special meetings of the Executive Committee may be called by the
Chairman or the President, or by the Chairman of the Executive
Committee (if he be a person other than the Chairman or the
President) or by any other two members of the Executive Committee,
at any time. Notice of any special meeting of the Executive
Committee may be given in the manner provided in the By-Laws for
giving notice of a special meeting of the Board of Directors, but
notice of any such meeting need not be given to any member of the
Executive Committee if waived by him in writing (including
telegram, cablegram or radiogram) or if he shall be present at the
meeting; and any meeting of the Executive Committee shall be a
legal meeting, without any notice thereof having been given, if all
the members shall be present thereat. A majority of the Executive
Committee shall constitute a quorum for the transaction of
business; and the act of a majority of those present at any meeting
at which a quorum is present shall be the act of the Executive
Committee.
3. Executive Committee; Records. The Executive Committee
shall keep a record of its acts and proceedings and shall report
the same, from time to time, to the Board of Directors. The
Secretary of the Corporation, or in his absence, an Assistant
Secretary, shall act as secretary to the Executive Committee; or
the Committee may, in its discretion, appoint its own secretary.
4. Other Committees. The Board of Directors may from time
to time, by resolution passed by a majority of the whole Board,
designate one or more other committees for any purpose, each
consisting of two or more Directors, and may delegate to any such
committee such powers of the Board of Directors in the management
of the business and affairs of the Corporation as the Board may
deem expedient, subject to the provisions of these By-Laws, with
power to sub-delegate such powers, if by the Board deemed
desirable.
ARTICLE VI
Miscellaneous
1. Fiscal Year. The fiscal year of the corporation shall
end on Friday of the last weekend in January of each year,
effecting a 52-53 week fiscal year basis.
2. Corporate Seal. The Secretary or any Assistant
Secretary, or other officer thereunto designated by the Secretary,
shall have authority to affix the corporate seal to any document
requiring such seal and to attest the same.
3. Execution of Instruments. The bills, notes, checks, and
other instruments for the payment of money, all agreements,
indentures, mortgages, deeds, conveyances, transfers, certificates,
declarations, receipts, discharges, releases, satisfactions,
settlements, petitions, schedules, accounts, affidavits, bonds,
undertakings, proxies and other instruments or documents may be
signed, executed, acknowledged, verified, delivered, or accepted on
behalf of the corporation by the Chairman, the President, any Vice
President, the Secretary or the Treasurer. Any such instruments
may also be signed, executed, acknowledged, verified, delivered or
accepted on behalf of the corporation in such other manner and by
such other officers, employees or agents of the corporation as the
Board of Directors or Executive Committee may from time to time
direct.
4. Dividends. Dividends shall be declared only at such times
and in such amounts as the Board of Directors shall direct.
ARTICLE VII
Amendments
Except as otherwise provided herein or in the Articles of
Incorporation, these By-Laws or any provisions thereof may be
amended, altered, or repealed, in any particulars and new By-Laws
or provisions, not inconsistent with any provision of the
Certificate of Incorporation or any provision of law, may be
adopted by the Board of Directors, at any meeting thereof, by the
by the affirmative vote of a majority of the whole number of
Directors, or by the stockholders of the Corporation, at any
meeting of the stockholders, provided, however, that the power of
the Directors to make and alter By-Laws shall be subject to such
restrictions upon the exercise of such power as may be expressly
imposed by the stockholders in any By-Laws adopted by them from
time to time.
________________________
Adopted by the Board of Directors of Hughes Supply, Inc. on
November 18, 1986.
AMENDMENT NO. 1 TO
HUGHES SUPPLY, INC.
DIRECTORS' STOCK OPTION PLAN
WHEREAS, the Board of Directors of Hughes Supply, Inc. (the
"Corporation") approved the Directors' Stock Option Plan (the
"Plan") on January 24, 1989 in the form attached hereto as Appendix
"A";
WHEREAS, the letter from the staff of the Securities and
Exchange Commission referred to in Section 14 of the Plan was
issued by the Commission Staff on April 6, 1989 satisfying the
conditions of Section 14;
WHEREAS, the shareholders of the Corporation approved the Plan
at the Annual Meeting of Shareholders held on May 30, 1989;
WHEREAS, in accordance with the terms of Sections 3 and 4 of
the Plan, options with respect to all of the stock authorized for
options under the Plan have been granted and no additional options
under the Plan may be granted in the absence of the expiration or
termination of presently outstanding options or an amendment to the
Plan increasing a number of shares as to which options may be
granted; and
WHEREAS, the Board of Directors of the Corporation on March
24, 1994 approved and recommended shareholder approval of an
amendment to the Plan to increase by 75,000 the number of shares as
to which options may be granted under the Plan; and
WHEREAS, the shareholders approved the recommended amendment
at Annual Meeting of Shareholders held on May 24, 1994 increasing
from 60,000 to 135,000 the number of shares with respect to which
options may be granted under the Plan from 60,000 shares to 135,000
shares;
NOW, THEREFORE, IN WITNESS THEREOF, the following provisions
of the Plan are hereby amended and modified as follows:
Section 3.
Section 3. Participants and Options is hereby amended and
modified to amend and modify subparagraph (ii) thereof and to add
a new subparagraph (iii) as follows:
3. PARTICIPANTS AND OPTIONS
(ii) In addition to the options referred to in
subparagraph (i) above, during the term of the Plan
until, but not including, the date of the 1994 annual
meeting of shareholders a subsequent grant of options for
an aggregate of 12,000 shares, or such lesser number of
shares as shall then constitute all of the remaining
shares which are authorized for options under the Plan
but which are not then subject to options under the Plan,
within the limitation set forth in Section 4 hereof,
divided equally (rounded, if necessary, down to the
nearest whole number of shares) among the Participants
under the Plan, will be made at the meeting of the Board
of Directors of the Corporation immediately following the
1990 annual meeting of stockholders of the Corporation
and at each Board meeting immediately following each
annual meeting of stockholders thereafter during the term
of the Plan and prior to the 1994 annual meeting of
shareholders.
(iii) In addition to the options referred to in
subparagraphs (i) and (ii) above, during the term of the
Plan beginning with the date of the 1994 annual meeting
of shareholders a subsequent grant of options for an
aggregate of 15,000 shares or such lesser number of
shares as shall then constitute all of the remaining
shares which are authorized for options under the Plan
but which are not then subject to options under the Plan,
within the limitations set forth in Section 4 hereof,
divided equally (rounded, if necessary, down to the
nearest whole number of shares) among the Participants
under the Plan, will be made at the meeting of the Board
of Directors of the Corporation immediately following the
1994 annual meeting of stockholders of the Corporation at
each Board meeting immediately following each annual
meeting of stockholders thereafter during the term of the
Plan.
Section 4.
Section 4. Stock is hereby amended and modified to read in its
entirety as follows:
4. STOCK
The stock which may be subject to options under the
Plan shall be 135,000 shares of the Corporation's
authorized but unissued or reacquired $1.00 par value
common stock hereafter sometimes called capital stock.
The aggregate number of shares of capital stock which are
subject to outstanding options and which will be subject
to options to be granted under the Plan shall be subject
to adjustment in accordance with the provisions of
subsection (h) of Section 5 hereof.
In the event that any outstanding option under the
Plan for any reason expires or is terminated, the shares
of capital stock allocable to the unexercised portion of
such option may again be subject to an option under the
Plan.
Of the stock which may be subject to options under
the Plan, 75,000 of such shares have been added by an
amendment to the Plan approved by the stockholders on May
24, 1994 and such additional shares constitute shares as
to which "Amendment Options" within the meaning of
Section 6 hereof may be granted and approval by the
stockholders of such amendment extends the term of the
Plan in accordance with Section 6 hereof.
Except as hereinbefore set forth, the Plan shall remain
unchanged and in full force and effect.
The amendments and modifications set forth in this Amendment
No. 1 to Hughes Supply, Inc. Directors' Stock Option Plan were
approved and adopted by the Board of Directors and the stockholders
on the dates hereinabove set forth.
Witness my hand and the seal of the Corporation this 24th day
of May, 1994.
s/Robert N. Blackford
Robert N. Blackford, Secretary
Hughes Supply, Inc.
HUGHES SUPPLY, INC.
Directors' Stock Option Plan
1. PURPOSE
This Directors Stock Option Plan (the "Plan") is intended
as an incentive and to encourage Directors of Hughes Supply, Inc.
(the "Corporation") who are not, and for the previous twelve (12)
months have not been, employees of the Corporation eligible to
participate in the Hughes Supply, Inc. 1988 Stock Option Plan (the
"Employee Plan") to increase their stock ownership and proprietary
interest in the success of the Corporation, to encourage them to
continue as Directors of the Corporation and as an incentive to
work to increase the value of the stock of the Corporation. The
options to be issued pursuant to this Plan shall not constitute
incentive stock options within the meaning of Sec. 422A of the 1986
Internal Revenue Code, as amended (the "Code").
2. ADMINISTRATION
The Plan shall be administered by a Directors' Stock
Option Plan committee appointed by the Board of Directors of the
Corporation (the "Committee"). The Committee shall consist of not
less than three (3) members of the Corporation's Board of Directors
who are not,,employees of the Corporation and who are
"disinterested persons as that term is defined in Rule 16b-3(d)
under the Securities Exchange Act of 1934 (the "Exchange Act") or
any successor statute or regulation regarding the same subject
matter. The Board of Directors may from time to time remove
members from, or add members to, the Committee. Vacancies on the
Committee, howsoever caused, shall be filled by the Board of
Directors. The Committee shall elect one of its members as
Chairman, and shall hold meetings at such times and places as it
may determine. Acts of the Committee taken by a majority of the
Committee at a meeting at which a quorum is present, or acts
reduced to or approved in writing by a majority of the members of
the Committee, shall be the valid acts of the Committee. A
nonemployee Director shall receive options under the Plan whether
or not such Director also serves as a member of the Committee.
Subject to the provisions of the Plan the Committee may from time
to time adopt such rules for administration of the Plan as it deems
appropriate.
The interpretation and construction by the Committee of
any provisions of the Plan or of any option granted under it shall
be final unless otherwise determined by the Board of Directors. No
member of the Board of Directors or the Committee shall be liable
for any action or determination made in good faith with respect to
the Plan or any option granted under it.
<PAGE>
3. PARTICIPANTS AND OPTIONS
The persons who shall be participants under the Plan (the
"Participants") shall be all such Directors of the Corporation as
are not on the date of the grant of an option under the Plan, and
for a period of at least twelve (12) months prior to the grant of
such option have not been, employees of the Corporation. Options
are granted and shall be granted to Participants under the Plan as
follows:
(i) Subject to approval of the Plan by the
stockholders in accordance with Section 13 hereof and to the
receipt by the Corporation of the letter from the staff of the
Securities and Exchange Commission referred to in Section 14
hereof, an initial grant of an aggregate of 12,000 shares divided
equally (rounded, if necessary, down to the nearest whole number of
shares) among the Participants is made effective as of January 24,
1989 to the Participants on that date.
(ii) In addition to the options referred to in
subparagraph (i) above, during the term of the Plan a subsequent
grant of options for an aggregate of 12,000 shares or such lesser
number of shares as shall then constitute all of the remaining
shares which are not then, but which may be subject to options
under the Plan within the limitation set forth in Section 4 hereof,
divided equally (rounded, if necessary, down to the nearest whole
number of shares) among the then Participants under the Plan, will
be made at the meeting of the Board of Directors of the Corporation
immediately following the 1990 annual meeting of stockholders of
the Corporation and at each Board meeting immediately following
each annual meeting of stockholders of the Corporation thereafter
during the term of the Plan.
4. STOCK
The stock which may be subject to the options under the
Plan shall be 60,000 shares of the Corporations authorized but
unissued or reacquired $1.00 par value common stock hereafter
sometimes called capital stock. The aggregate number of shares of
capital stock which are subject to outstanding options and which
will be subject to options to be granted under the Plan shall be
subject to adjustment in accordance with the provisions of
subsection (h) of Section 5 hereof.
In the event that any outstanding option under the Plan
for any reason expires or is terminated, the shares of capital
stock allocable to the unexercised portion of such option may again
be subjected to an option under the Plan.
5. TERMS AND CONDITIONS OF OPTIONS: STOCK OPTION AGREEMENTS
Stock options granted pursuant to the Plan shall be
evidenced by stock option agreements in such form as the Committee
shall from time to time recommend and the Board of Directors shall
from time to time approve, which agreements shall comply with and
be subject to the following terms and conditions:
(a) Optionee's Agreement
Each optionee shall agree to remain as a Director of
the Corporation but such agreement shall not impose upon the
Corporation any obligation to retain the optionee as a Director for
any period.
(b) Number of Shares
Each option shall state the number of shares to
which it pertains.
(c) Option Price
Each option shall state the option price, which
shall be not less than one hundred percent (100%) of the fair
market value of the shares of capital stock of the Corporation on
the date of the granting of the option. During such time as such
stock is not listed upon an established stock exchange the fair
market value per share shall be the mean between dealer "bid" and
"ask" prices of the capital stock in over-the-counter market
applicable to transactions effected in Orlando, Florida on the day
the option is granted, as reported by the National Association of
Securities Dealers, Inc. If the stock is listed upon an
established stock exchange or exchanges such fair market value
shall be deemed to be the highest closing price of the capital
stock on such stock exchange or exchanges on the day the option is
granted or if no sale of the Corporation's capital stock shall have
been made on any stock exchange on that day, on the next preceding
day on which there was a sale of such stock. Subject to the
foregoing, the Board of Directors and the Committee in fixing the
option price shall have full authority and discretion and be fully
protected in doing so.
(d) Medium and Time of Payment
The option price shall be payable in United States
dollars upon the exercise of the option and may be paid in cash, by
check or with shares of capital stock of the Corporation valued at
their fair market value, as that term is defined in the preceding
paragraph.
(e) Term and Exercise of Options
An option shall be exercisable either in whole or in
part at any time after the date on which it is granted and prior to
its expiration date which, unless sooner terminated under
subsections (f) or (g) of this Section 5 hereof, shall be ten (10)
years from the date on which it is granted. The procedure for
exercise of an option shall be as set forth in the Plan and in the
stock option agreement evidencing the grant of the option. In the
event of any conflict between the language of the stock option
agreement and the language of the Plan, the language of the Plan
shall govern. No option shall be exercisable after its expiration
date. Not less than ten (10) shares may be purchased at any one
time unless the number purchased is the total number at the time
purchasable under the option. During the lifetime of the optionee,
the option shall be exercisable only by him and shall not be
assignable or transferable by him and no other person shall acquire
any rights therein.
(f) Termination of Service as a Director Except Death
In the event that an optionee shall cease to be a
Director of the Corporation for any reason other than his death,
subject to the condition that no option shall be exercisable after
its expiration date, such optionee shall have the right to exercise
the option at any time within three (3) months after such
termination as a Director to the extent his right to exercise such
option has not previously been exercised at the date of such
termination. For purposes of this paragraph, in the case of an
optionee who becomes disabled within the meaning of Sec. 22(3)(e) of
the Code, the words "three months" shall be replaced by the words
"one year".
(g) Death of Optionee and Transfer of Option
If the optionee shall die while a Director of the
Corporation or within a period of three (3) months after the
termination of his service as a Director of the Corporation and
shall not have fully exercised the option, an option may be
exercised at any time within one (1) year after the optionee's
death, subject to the condition that no option shall be exercisable
after its expiration date, to the extent that the optionee's right
to exercise such option at the time of his death had not been
previously exercised, by the executors or administrators of the
optionee or by any person or persons who shall have acquired the
option directly from the optionee by bequest or inheritance or by
reason of the death of the decedent.
No option shall be transferable by the optionee
otherwise than by Will or the laws of descent and distribution.
(h) Recapitalization
Subject to any required action by the stockholders,
the number of shares of capital stock which are subject to each
outstanding option or which will be subject to each option to be
granted under the Plan, and the price per share thereof in each
such option, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of capital stock of the
Corporation resulting from a subdivision or consolidation of shares
or the payment of a stock dividend (but only on the capital stock)
or any other increase or decrease in the number of such shares
effected without receipt of consideration by the Corporation.
Subject to any required action by the stockholders
if the Corporation shall be the surviving corporation in any
merger or consolidation, each outstanding option shall pertain to
and apply to the securities to which a holder of the number of
shares of capital stock subject to the option would have been
entitled. A dissolution or liquidation of the Corporation or a
merger or consolidation in which the Corporation is not the
surviving corporation, shall cause each outstanding option to
terminate provided that each optionee shall, in such event, have
the right immediately prior to such dissolution or liquidation, or
merger or consolidation in which the Corporation is not the
surviving corporation, to exercise his option in whole or in part.
In the event of a change in the capital stock of the
Corporation as presently constituted, which is limited to a change
of all of its authorized shares with par value into the same number
of shares with a different par value or without par value, the
shares resulting from any such change shall be deemed to be the
capital stock within the meaning of the Plan.
To the extent that the foregoing adjustments relate
to stock or securities of the Corporation, such adjustments shall
be made by the Committee, whose determination in that respect shall
be final, binding and conclusive.
Except as hereinbefore expressly provided in this
subsection 5(h), the optionee shall have no rights by reason of any
subdivision or consolidation of shares of stock of any class or the
payment of any stock dividend or any other increase or decrease in
the number of shares of stock of any class or by reason of any
dissolution, liquidation, merger, or consolidation or spin-off of
assets or stock of another corporation, and any issue by the
Corporation of shares of stock of any class, or securities
convertible into shares of stock of any class, shall not affect,
and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of capital stock subject to the
option.
The grant of an option pursuant to the Plan shall
not affect in any way the right or power of the Corporation to make
adjustments, reclassifications, reorganizations or changes of its
capital or business structure or to merge or to consolidate or to
dissolve, liquidate or sell, or transfer all or any part of its
business or assets.
(i) Rights as a Stockholder
An optionee or a transferee of an option shall have
no rights as a stockholder with respect to any shares covered by
his option until the date of the issuance of a stock certificate to
him for such shares. No adjustments shall be made for dividends
(ordinary or extraordinary, whether in cash, securities or other
property) or distributions or other rights for which the record
date is prior to the date such stock certificate is issued, except
as provided in subsection 5(h) hereof.
(j) Modification, Extension and Renewal of Options
Subject to the terms and conditions and within the
limitations of the Plan, the Board of Directors may modify, extend
or renew outstanding options granted under the Plan, or accept the
surrender of outstanding options (to the extent not theretofore
exercised) and authorize the granting of new options in
substitution therefor (to the extent not theretofore exercised).
Notwithstanding the foregoing, however, no modification of an
option shall, without consent of the optionee, alter or impair any
rights of obligations under any option theretofore granted under
the Plan.
(k) Investment Purpose
Each option under the Plan shall be granted on the
condition that the purchases of stock thereunder shall be for
investment purposes, and not with a view to resale or distribution
except that in the event the stock subject to such option is
registered under the Securities Act of 1933, as amended (the
"Securities Act"), or in the event a resale of such stock without
such registration would otherwise be permissible, such condition
shall be inoperative if in the opinion of counsel for the
Corporation such condition is not required under the Securities
Act, or any other applicable law, regulation, or rule of any
governmental agency.
(I) Other Provisions
The option agreements authorized under the Plan
shall contain such other provisions, including, without limitation,
restrictions upon the exercise of the option, as the Committee and
the Board of Directors of the Corporation shall deem advisable.
6. EFFECTIVE DATE AND TERM OF PLAN
Subject to approval by the stockholders as required by
Section 13 hereof and to the receipt by the Corporation of the
letter from the staff of the Securities and Exchange Commission
referred to in Section 14 hereof, the Plan shall become effective
as of January 24, 1989, the date of its adoption by the Board of
Directors of the Corporation and, subject to such stockholder
approval and the receipt of such letter, the initial grant of
options hereunder as provided in subsection 3(i) shall be effective
as of the effective date of the Plan. This Plan shall remain in
effect and options shall be granted hereunder from time to time
until ten (10) years from the date the Plan is approved by the
stockholders or until terminated by the Board of Directors in
accordance with Section 8 hereof, whichever is earlier.
Notwithstanding the foregoing part of this Section 6, with respect
to any amendment to this Plan adopted for the purpose of increasing
the number of shares as to which options ("Amendment Options") may
be granted hereunder, the Plan shall remain in effect as to
Amendment Options and Amendment Options may be granted hereunder
from time to time until ten (10) years from the date such amendment
is adopted or the date such amendment is approved by the
stockholders if such approval is required or until the Plan, as
amended, is terminated by the Board of Directors in accordance with
Section 8 hereof, whichever is earlier. For purposes of options
outstanding under the Plan the Plan shall continue in effect until
all outstanding options have been exercised in full or are no
longer exercisable.
7. INDEMNIFICATION OF COMMITTEE
In addition to such other rights of indemnification as
they may have as Directors or as members of the Committee, the
members of the Committee shall be indemnified by the Corporation
against the reasonable expenses, including attorneys fees, actually
and necessarily incurred in connection with the defense of any
action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason of
any action taken or failure to act under or in connection with the
Plan or any option granted thereunder, and against all amounts paid
by them in settlement thereof, not to exceed, in the judgment of
the Board of Directors, the estimated expense of litigating the
proceeding to conclusion (provided such settlement is approved by
independent legal counsel selected by the Corporation) or paid by
them in satisfaction of a judgment in any such action, suit or
proceeding, except in relation to matters as to which it shall be
adjudged in such action, suit or proceeding that the member of the
Committee is liable. A Committee member shall in writing offer the
Corporation the opportunity, at its own expense, to handle and
defend the same.
8. AMENDMENT OF THE PLAN
The Board of Directors of the Corporation may, insofar as
permitted by law, from time to time, with respect to any shares at
the time not subject to options, suspend or discontinue the Plan or
revise or amend it in any respect whatsoever except that, without
approval of the stockholders, no such revision or amendment shall
change the number of shares subject to the Plan, extend the term of
the Plan or the term of any option which may be granted under the
Plan, change the designation of the Participants or the manner in
which options are granted under the Plan or materially increase the
benefits accruing under the Plan (materially, within the meaning of
Rule 16b-3 implementing the Exchange Act), decrease the price at
which options may be granted or remove the administration of the
Plan from the Committee (except as may be required by the staff of
the Commission to provide the letter described in Section 13
hereof).
9. APPLICATION OF FUNDS
The proceeds received by the Corporation from the sale of
capital stock pursuant to options will be used for general
corporate purposes.
10. NO OBLIGATION TO EXERCISE OPTION
The granting of an option shall impose no obligation upon
the optionee to exercise such option.
11. WITHHOLDING
The exercise of any option granted under the Plan shall
constitute an optionee's full and complete consent to whatever
action the Committee directs to satisfy the federal and state
withholding requirements, if any, which the Committee in its
discretion deems applicable to such exercise or surrender.
12. CONSTRUCTION
The Plan shall be construed under the laws of the State
of Florida.
13. APPROVAL OF STOCKHOLDERS
The Plan shall be submitted for approval by the
stockholders of the Corporation within twelve (12) months from the
date the Plan is adopted by the Board of Directors. Any amendment
to the Plan requiring approval by the stockholders of the
Corporation shall be submitted for approval by the stockholders
within twelve (12) months from the date the amendment is adopted by
the Board of Directors.
The initial options granted under the Plan, as set forth
in subsection 3(i) hereof are granted as of the date set forth
therein; provided, however, that such options shall not be
exercisable until after the date on which the Plan shall have
approved by a vote of the stockholders. Options may be granted
pursuant to any amendment to this Plan adopted for the purpose of
increasing the number of shares as to which options may be granted,
the types of options which may be granted or the rights applicable
to options which may be granted hereunder, commencing with the date
of adoption of such amendment by the Board of Directors of the
Corporation; provided, however, that options granted in reliance
upon any such amendment shall not be exercisable until the date on
which such amendment shall have been submitted for approval of the
stockholders.
14. LETTER FROM COMMISSION STAFF
The Corporation will request a letter from the staff of
the Securities and Exchange Commission (the "Commission")
concurring with the opinion of legal counsel to the Corporation
that the Plan complies with the requirements set forth in Rule 16b-
3 promulgated by the Commission to provide exemptive relief from
certain aspects of Section 16(b) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"). If, as a condition of
providing its concurring letter, the staff of the Commission
requires modifications to the Plan which are not material and such
modifications are approved by the Board of Directors, the Plan
shall be so modified and amended under the provisions of Section 8
hereof. In the event the Corporation is unable to obtain the
aforementioned concurring letter from the staff of the Commission
as required by this Section 14 or the Plan is not approved by the
stockholders as required by Section 13 hereof, the Plan shall be
deemed null and void ab initio.
