THIS CONFORMING PAPER FORMAT DOCUMENT IS BEING SUBMITTED PURSUANT TO RULE
901(D) OF REGULATION S-T
Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1995
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from
____________ to ______________
Commission File Number 0-15339
THE STROBER ORGANIZATION, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 11-2822910
(State of Organization (IRS Employer Identification Number
or other Jurisdiction
of Incorporation)
550 Hamilton Avenue
BROOKLYN, NEW YORK 11232
(Address of principal executive office)
(718) 832-1212
(Registrant's telephone number,
including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to
filing requirements for the past 90 days.
Yes X No _____
COMMON STOCK $.01 PAR - SHARES ISSUED AND OUTSTANDING AT JUNE 30, 1995 -
5,060,922
(Number of shares outstanding of each class of the Registrant's Common Stock)
This report contains a total of 37 pages.
<PAGE>
THE STROBER ORGANIZATION, INC. AND SUBSIDIARIES
INDEX
PAGE
Face Sheet............................................................1
Index.................................................................2
Part I Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets as of
June 30, 1995 and December 31, 1994....................3
Consolidated Statements of Operations for the
Three Months Ended June 30, 1995 and 1994..............4
Consolidated Statements of Operations for
the Six Months Ended June 30, 1995
and 1994...............................................5
Consolidated Statements of Cash Flows
for the Six Months Ended June 30,
1995 and 1994..........................................6
Notes to Consolidated
Financial Statements...................................7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations..........................................8-10
Part II Other Information..................................11-12
Part III Exhibits..............................................13
Signature............................................................14
<PAGE>
Part 1-Financial Statements
The Strober Organization, Inc. and Subsidiaries Consolidated Balance Sheets
(In Thousands)
June 30, DEC. 31,
ASSETS 1995 1994
Current assets:
Cash $3,876 $3,890
Accounts receivable, net of allowance for
doubtful accounts of $2,832 and $2,320
in 1995 and 1994, respectively 17,689 16,651
Inventory 11,838 10,741
Deferred income taxes 926 926
Other current assets 311 350
Total current assets 34,640 32,558
Property and equipment, net 3,210 2,518
Goodwill, net of accumulated amortization
of $1,555 and $1,450 in 1995 and 1994,
respectively 6,831 6,936
Other assets 628 637
Total assets $45,309 $42,649
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt $1,081 $1,233
Revolving line of credit - -
Accounts payable 6,755 5,056
Accrued expenses and taxes 4,202 4,425
Total current liabilities 12,038 10,714
Long-term debt, less current installments 1,271 1,171
Deferred income taxes 77 77
Total liabilities 13,386 11,962
Stockholders' equity:
Preferred stock, $.01 par value, 1,000
shares authorized and unissued - -
Common stock, $.01 par value, 20,000
shares authorized; issued: 5,173 and outstanding
5,061 shares in 1995 and issued 5,167
and outstanding 5,055 in 1994 52 52
Additional paid-in capital 7,022 7,013
Retained earnings 25,334 24,107
Less: Treasury stock at cost, 112 shares
in 1995 and 1994 (485) (485)
Total stockholders' equity 31,923 30,687
Total liabilities and stockholders' equity $45,309 $42,649
See notes to the accompanying financial statements
<PAGE>
The Strober Organization, Inc. and Subsidiaries
Consolidated Statements of Operations
Three Months Ended June 30, 1995 and 1994
(In thousands, except per share data) 1995 1994
Net sales $34,035 $34,709
Cost of goods sold 25,225 26,003
Gross profit 8,810 8,706
Selling, general and administrative expenses 7,161 7,126
Income from operations 1,649 1,580
Interest expense (58) (196)
Interest income 84 90
Net income before income taxes 1,675 1,474
Provision for income taxes 687 516
Net income $988 $958
Net income per share $0.19 $0.19
Weighted average number of shares
outstanding 5,227 5,167
The computation of fully diluted earnings per share does not materially
differ from that presented above.
See accompanying notes to consolidated financial statements.
<PAGE>
The Strober Organization, Inc. and Subsidiaries
Consolidated Statements of Operations
Six Months Ended June 30, 1995 and 1994
(In thousands, except per share data) 1995 1994
Net sales $62,202 $55,165
Cost of goods sold 46,002 40,780
Gross profit 16,200 14,385
Selling, general and administrative expenses 14,198 13,681
Income from operations 2,002 704
Interest expense (112) (373)
Interest income 189 172
Net income before income taxes 2,079 503
Provision for income taxes 852 176
Net income $1,227 $327
Net income per share $0.24 $0.06
Weighted average number of shares
outstanding 5,217 5,165
The computation of fully diluted earnings per share does not materially
differ from that presented above.
See accompanying notes to consolidated financial statements.
<PAGE>
The Strober Organization, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
Six Months Ended June 30, 1995 and 1994
(In thousands)
1995 1994
Cash flows from operating activities:
Net income $1,227 $327
Adjustments to reconcile net
income to net cash provided by
(used by) operating activities:
Depreciation and amortization 695 743
Provision for estimated losses
on accounts receivable 384 552
Changes in operating assets and
liabilities:
Accounts receivable (1,422) (1,934)
Inventory (1,097) (2,652)
Other assets 38 407
Accounts payable 1,699 2,509
Accrued expenses and taxes (224) (1,214)
Net cash provided by (used by) operating
activities 1,300 (1,262)
Cash flows from investing activities:
Additions to property and
equipment, net (392) (135)
Cash flows from financing activities:
Repayment of long-term debt (931) (646)
Net increase in revolving line of
credit --- 1,746
Proceeds from exercise of stock options 9 26
Net cash (used by) provided by financing
activities (922) 1,126
Net decrease in cash (14) (271)
Cash at beginning of period 3,890 3,082
Cash at end of period $3,876 $2,811
See accompanying notes to consolidated financial statements
<PAGE>
THE STROBER ORGANIZATION, INC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) UNAUDITED STATEMENTS
The accompanying unaudited financial statements and other related
financial information furnished reflect all adjustments which are in the
opinion of management, necessary to a fair presentation of the financial
position as of June 30, 1995 and the results of operations and cash flows for
the six months ended June 30, 1995 and 1994.
(2) PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiaries. Significant intercompany balances and
transactions have been eliminated.
(3) STATEMENTS OF CASH FLOWS-SUPPLEMENTAL DISCLOSURES
Schedule of amounts paid for interest and income taxes:
1995 1994
(In thousands)
Interest paid $ 95 $ 235
Income taxes paid $ 733 $ 1,050
Capital lease obligations
incurred for purchase of
equipment $ 880 $ -0-
(4) CONDENSED FINANCIAL STATEMENTS
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that these
consolidated condensed financial statements be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
December 31, 1994 financial statements. The results of operations for the
period ended June 30, 1995 are not necessarily indicative of the operating
results for the full year.
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following table sets forth certain statement amounts expressed as a
percentage of sales:
<TABLE>
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
JUNE 30, 1995 JUNE 30, 1994 JUNE 30, 1995 JUNE 30, 1994
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of goods sold 74.1% 74.9% 74.0% 73.9%
Gross profit 25.9% 25.1% 26.0% 26.1%
SG&A expenses 21.0% 20.5% 22.8% 24.8%
Income from operations 4.9% 4.6% 3.2% 1.3%
Net interest income (expense) .1% -.3% .1% -.4%
Net income before income taxes 5.0% 4.3% 3.3% .9%
Provision for income taxes 2.0% 1.5% 1.3% .3%
Net income 3.0% 2.8% 2.0% .6%
</TABLE>
RESULT OF OPERATIONS
SECOND QUARTER ENDED JUNE 30, 1995 COMPARED TO SECOND QUARTER ENDED JUNE 30,
1994.
Net sales for the quarter ended June 30, 1995 decreased by $674,000 (2%)
compared to the same period in 1994 due to a leveling of sales activity in the
Company's marketing regions.
Gross profit increased by $104,000 (1%) in the second quarter of 1995 as
compared to the same period in 1994 due to higher profit margins. Gross profit
as a percentage of sales increased from 25.1% to 25.9% in the second quarter of
1995 compared to the same period in 1994.
Selling, general and administrative expenses increased by $35,000 (1/2%) in the
second quarter of 1995 compared to the same period in 1994.
<PAGE>
The following table shows the components of the SG&A expenses:
THREE MONTHS ENDED
IN THOUSANDS 6/30/95 6/30/94
Delivery $ 2,763 $ 2,797
Selling 1,037 1,033
Administrative 3,361 3,296
$7,161 $7,126
Interest expense decreased by $138,000 in the second quarter of 1995 compared
to the same period in 1994. This decrease results from lower outstanding loan
balances on financing debt.
Income from operations increased $69,000 in the second quarter of 1995 to
$1,649,000 compared to $1,580,000 in the same period in 1994. This increase
resulted from higher gross margin dollars reduced by higher operating expenses.
Net income before taxes increased $201,000 in the 1995 second quarter to
$1,675,000 compared to $1,474,000 in the same period in 1994 due to increased
operating income and lower interest costs.
The net income for the second quarter of 1995 reflects an income tax provision
of $687,000 compared to a provision of $516,000 for same period in 1994.
Certain federal income tax benefit carryovers have been exhausted as of
December 31, 1994, resulting in an increase in the effective income tax rate
from 35% in 1994 to 41% in 1995. Net income for the second quarter ended June
30, 1995 increased $30,000 to $988,000 compared to $958,000 in the same period
in 1994.
SIX MONTH PERIOD ENDED JUNE 30, 1995 COMPARED TO SIX MONTH PERIOD ENDED JUNE
30, 1994.
Net sales for the six month period ended June 30, 1995 increased by $7 million
(13%) compared to the same period in 1994. The increase in sales is primarily
due to better weather conditions experienced in the Northeast this winter as
compared to the extremely severe winter weather conditions endured during the
first quarter of 1994.
Gross profit increased by $1.8 million (13%) in the first six months of 1995 as
compared to the same period in 1994 due to the higher sales volume. Gross
profit as a percentage of sales was 26.0% during the 1995 first six month
period compared to 26.1% in the same period in 1994.
Selling, general and administrative expenses increased by $517,000 (4%). This
increase is primarily attributable to increased variable expenses associated
with higher sales volume achieved in the 1995 six month period compared to 1994
and increased insurance and employee benefit costs. Bad debt expenses included
in SG&A expenses decreased by $168,000 during the 1995 first six month period
compared to 1994.
The following table shows the components of the SG&A expenses.
SIX MONTHS ENDED
IN THOUSANDS
6/30/95 6/30/94
Delivery $ 5,452 $ 5,223
Selling 2,039 2,011
Administrative 6,707 6,447
$ 14,198 $ 13,681
Interest expense decreased by $261,000 in the six month period ended June 30,
1995 compared to the same period in 1994. This decrease results from lower
outstanding loan balances on financing debt, as the Company did not incur any
borrowings on its working capital facility during the first six months of 1995
and continued to reduce its outstanding subordinated debt obligation.
Income from operations increased $1.3 million in the six month period ended
June 30, 1995 to $2,002,000 compared to $704,000 in the same period in 1994.
This increase is attributable to higher gross margin dollars resulting from the
increased sales activity, reduced by increases in operating expenses. Net
income before taxes increased $1.6 million in the six month period ended June
30, 1995 to $2.1 million compared to $503,000 in the same period in 1994 due to
increased operating income and lower interest costs.
The net income for the six month period ended June 30, 1995 reflects an income
tax provision of $852,000 compared to $176,000 in the same period of 1994. Net
income for the six month period ended June 30, 1995 increased $900,000 to
$1,227,000 compared to $327,000 in the same period in 1994.
LIQUIDITY AND CAPITAL RESOURCES
The Company financed its operations in the first six month period of 1995 with
cash generated from operations. The Company also maintains a revolving working
capital line of credit in the amount of $10,000,000 with the Chase Manhattan
Bank, N.A. Borrowings under the credit facility are made as needed, up to a
maximum of 75% of eligible accounts receivable and bear interest at the prime
rate plus 1/2 a percentage point or at the option of the Company at various
fixed LIBOR interest rates.
The Company pledged as collateral for the credit facility its accounts
receivable and is required to maintain certain financial covenants. At June
30, 1995 and December 31, 1994, there were no balances owed under this credit
line.
Capital expenditures, net of dispositions and including capital leases,
amounted to $1.3 million in the six month period ended June 30, 1995, compared
to $135,000 in the same period in 1994. The 1995 acquisitions were for
replacement of delivery equipment and facility improvements. The Company is
utilizing capital lease arrangements to finance the acquisition of new delivery
equipment.
In June 1995, the Company relocated its Farmingdale, New York facility to a
larger Farmingdale location. Facility improvements and fixtures associated
with the relocation was approximately $350,000.
<PAGE>
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS.
The Company is not a party to any material legal proceedings. It is,
however, involved in litigation relating to claims arising out of its
operations in the normal course of business. Such claims against the Company
are generally covered by insurance. It is the opinion of management that any
uninsured liability resulting from such litigation would not have a material
adverse effect on the Company's business, financial position or earnings.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
(a) The Annual Meeting of Stockholders of the Company was held on May
25, 1995.
(b) The Classified Board Amendments were approved, receiving the
required favorable majority vote necessary for approval as follows:
FOR AGAINST ABSTAIN
2,660,294 1,210,071 4,850
(c) The following nominees were elected by the following vote as
directors of the Company to serve until the Annual Meeting of
Stockholders applicable to their class or until their respective
successors shall be elected and shall qualify:
FOR WITHHELD
Class I (Term to Expire at 1996 Stockholder Meeting)
Emil W. Solimine 4,006,188 587,355
Eliott Zieky 4,428,837 164,706
Class II (Term to Expire at 1997 Stockholder Meeting)
Robert J. Gaites 4,428,837 164,706
Joseph Mangino, Sr. 4,428,837 164,706
Class III (Term to Expire at 1998 Stockholder Meeting)
David W. Bernstein 4,428,837 164,706
Alvin Murstein 4,428,837 164,706
John Yanuklis 4,428,837 164,706
<PAGE>
(d) The proposal to ratify the appointment of KPMG Peat Marwick LLP as
independent public accountants for the Company for the fiscal year
ending December 31, 1995 received the required favorable majority
vote necessary for approval as follows:
FOR AGAINST ABSTAIN
4,561,602 19,062 150
(e) The proposal to approve the Company's 1995 Outside Director Stock
Option Plan received the required favorable majority vote necessary
for approval as follows:
FOR AGAINST ABSTAIN
3,775,612 760,547 3,380
<PAGE>
PART III - EXHIBITS
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
3 (i)Restated and Amended Certificate of Incorporation.
3 (ii)Restated and Amended Bylaws.
27 Financial Data Schedule
(b) Reports on Form 8-K:
There were two Reports on Form 8-K filed during the quarter. The
first reported for an event dated May 10, 1995 filed a press release announcing
the Company's results of operations for the three months ended March 31, 1995.
The second reported an event dated May 22, 1995 filing a press release
announcing the Company's plan to buy back up to 250,000 of its shares of Common
Stock so as to enhance stockholder value.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE STROBER ORGANIZATION, INC.
By: /S/ DAVID J. POLISHOOK
----------------------------
David J. Polishook
Chief Financial Officer
and Treasurer
<PAGE>
EXHIBIT INDEX
EXHIBIT SEQUENTIALLY
NUMBER DESCRIPTION NUMBERED PAGE
3(i) Amended and Restated Certificate of Incorporation of Company.
3(ii) Amended and Restated By-Laws of Company.
4(a) Form of Common Stock Certificate incorporated by reference to
Exhibit 4(a) to Annual Report on Form 10-K for the year ended
December 31, 1986.
4(b) Amendatory Agreement dated December 14, 1990 together with
Amended and Restated Subordinated Note Due January 15, 1994,
incorporated by reference to Exhibit 4(b) to Annual Report for
the year ended December 31, 1990 incorporated by reference to
Exhibit 4(b) to Annual Report on Form 10-K for the year ended
December 31, 1990.
4(c) Warrant to Purchase 300,000 Common Shares dated December 14,
1990 incorporated by reference to Schedule 13D filed by Sue
Strober on December 22, 1990.
4(d) Reserved
4(e) Form of Warrant Extension Amendment between Strober and David
W. Bernstein amending the Warrant Agreement between Strober and
David W. Bernstein dated November 6, 1988, incorporated by
reference to Exhibit 4(e) to Annual Report on Form 10-K for the
year ended December 31, 1991.
10(a) Non-Qualified Stock Option Plan incorporated by reference to
Exhibit 10(a) to Amendment No. 2 to the Company's Registration
Statement on Form S-1 (Commission File No. 33-9348), filed on
November 7, 1986, as amended on August 13, 1991, which
amendment is incorporated by reference to Quarterly Report on
Form 10-Q for the three months ended September 30, 1991.
10(b) Form of Profit-Sharing Plans incorporated by reference to
Exhibit 10(b) to the Company's Registration Statement on Form
S-1 (Commission File No. 33-9348), filed on October 8, 1986 and
Exhibit 10(b) to Amendment No. 2 to the Company's Registration
Statement on Form S-1 (Commission File No. 33-9348), filed on
November 7, 1986.
10(c) Form of Target Benefit Plan incorporated by reference to
Exhibit 10(c) to the Company's Registration Statement on Form
S-1 (Commission File No. 33-9348), filed on October 8, 1986.
10(d) Restricted Stock Plan incorporated by reference to Exhibit
10(d) to Amendment No. 2 to the Company's Registration
Statement on Form S-1 (Commission File No. 33-0348), filed on
November 7, 1986.
10(e) Form of Lease between: (i) JNR Realty Company and Strober -
L.I. Bldg. - Supply Centers, Inc.; (ii) Strober Realty Company
and Strober Bros. Inc. Bldg. Supply Centers, Inc.; (iii) SCONN
Realty and Strober Connecticut Bldg. Supply Centers, Inc.; and
(iv) SY Realty Corp. and Strober- King Bldg. Supply Centers,
Inc. incorporated by reference to Exhibit 10(f) to Amendment
No. 1 to the Company's Registration Statement on Form S-1
(Commission File No. 33-9348), filed on November 4, 1986 and
Exhibit 10(f) to Amendment No. 2 to the Company's Registration
Statement on Form S-1 (Commission File No. 33-9348), filed on
November 7, 1986.
10(f) Form of Lease between: (i) General Realty Associates and
General Building Supply Company, (ii) P&Z Realty and General
Building Company; (iii) 3IS Associates and General Building
Supply Company; and (iv) Peter L. Churilo and General Building
Supply Company incorporated by reference to Exhibit 10(f) to
Annual Report on Form 10-K for the year ended December 31,
1987.
10(g) Form of Lease between: (i) SAY Realty Corp. and Strober-King
Bldg. Supply Centers, Inc.; (ii) P&Z Realty and General
Building Supply Company; and (iii) SG Realty Corp. and Strober
New Jersey Building Supply Center, Inc. incorporated by
reference to Exhibit 10(g) to Annual Report on Form 10-K for
the year ended December 31, 1988.
10(h) Form of Lease between Strober Bros. Inc. Building Supply
Centers and Elstro Company incorporated by reference to Exhibit
10(h) to Annual Report on Form 10-K for the year ended December
31, 1989.
10(i) Form of Agreement and Plan of Reorganization among the Company
and certain of its affiliates incorporated by reference to
Exhibit 2 to the Company's Registration Statement on Form S-1
(Commission File No. 33-9348), filed on October 8, 1986.
10(j) Amendment to Agreement and Plan of Reorganization dated January
25, 1988 incorporated by reference to Exhibit 4(d) to Current
Report on Form 8-K filed by the Company to report an event of
January 25, 1988.
10(k) Purchasers' Purchase Agreement between the Company and certain
of its affiliates incorporated by reference to Exhibit 4(e) to
Current Report on Form 8-K filed by the Company to report an
event of January 25, 1988.
10(l) Amendment to Purchasers' Purchase Agreement dated January 25,
1988 incorporated by reference to Exhibit 4(v) to Current
Report on Form 8-K filed by the Company to report an event of
January 25, 1988.
10(m) Corporate Purchase Agreement dated November 7, 1986
incorporated by reference to Exhibit (g) to Current Report on
Form 8-K filed by the Company to report an event of January 25,
1988.
10(n) Metal and Roofing Contract between Strober-Price Building
Supply Corp. and Local 282 effective January 1, 1991,
incorporated by reference to Exhibit 10(v) to Annual Report for
the year ended December 31, 1990.
10(o) Lease dated June 14, 1991 between The Chapin Trust and Strober
Building Supply Center, Inc., incorporated by reference to
Exhibit 10(w) to Annual Report on Form 10-K for the year ended
December 31, 1991.
10(p) Agreements between The General Building Supply Company and
Grocery, Bakery, Construction Drivers and Helpers, Teamsters
Local Union 559 for the years 1995 through 1998.
10(q) Form of Senior Subordinated Note due September 1, 1996 and form
of Employment Agreement incorporated by reference to Exhibit
10(q) to Annual Report on Form 10-K for the year ended December
31, 1993.
10(r) Credit Agreement dated as of December 9, 1994 between and among
the Company, certain of its subsidiaries and The Chase
Manhattan Bank (National Association).
10(s) Form of Agreement between the Marda Group of Building Materials
Distributors, Inc. and International Brotherhood of Teamsters,
Chauffeurs, Warehousemen of Local 807 and Helpers of America
for the Period Ending December 3, 1995, incorporated by
reference to Exhibit 10(s) to Annual Report on Form 10-K for
the year ended December 31, 1992.
10(t) Form of The Strober Organization, Inc. Fiduciary Reimbursement
and Indemnification Agreement incorporated by reference to
Exhibit 10(t) to Annual Report on Form 10-K for the year ended
December 31, 1992.
10(u) Addendum to Lease dated December 23, 1993 by and between The
Chapin Trust and Strober Building Supply Center, Inc.
incorporated by reference to Exhibit 10(u) to Annual Report on
Form 10-K for the year ended December 31, 1993.
10(v) Memorandum of Agreement by and between Local 282, IBT and
Strober Price Incorporated, incorporated by reference to
Exhibit 10(v) to Annual Report on Form 10-K for the year ended
December 31, 1993.
10(w) 1993 Outside Director Stock Option Plan incorporated by
reference and Exhibit 4.1 to the Company's Registration on Form
S-8 (Commission File No. 33-71766), filed November 16, 1993.
10(x) Form of 1994 Non-Qualified Stock Option Agreement between the
Company and each of its outside directors incorporated by
reference to Exhibit 10(x) to Annual Report on Form 10-K for
the year ended December 31, 1993.
10(y) Lease effective as of May 1, 1995 by and among Carman Road
Realty Inc., Broad Properties, Inc. and Strober Long Island
Building Material Centers, Inc. incorporated by reference to
Exhibit 10(y) to Annual Report on Form 10-K for the year ended
December 31, 1994.
10(z) Form of Master Lease Agreement dated as of March 24, 1995
between the Company and Chase Equipment Leasing, Inc.
incorporated by reference to Exhibit 10(z) to Quarterly Report
of Form 10-Q/A for the quarter ended March 31, 1995.
22(a) List of Subsidiaries of the Company.
24(a) Consent of Independent Auditors.
27 Financial Data Schedule for the three months ended June 30,
1995.
<PAGE>
Exhibit 3(i)
<PAGE>
RESTATED CERTIFICATE OF INCORPORATION
OF
THE STROBER ORGANIZATION, INC.
It is hereby certified that:
1. (a) The present name of the corporation (hereinafter called the
"Corporation") is THE STROBER ORGANIZATION, INC.
(b) The name under which the Corporation was originally
incorporated was THE STROBER ORGANIZATION, INC. and the date of filing the
original Certificate of Incorporation of the Corporation with the Secretary of
State of the State of Delaware was October 1, 1986.
2. The Certificate of Incorporation of the Corporation is hereby amended
by superseding and restating Article SEVENTH and by adding a new Article
TWELFTH which are set forth in the Restated Certificate of Incorporation
hereinafter provided for.
3. The provisions of the Certificate of Incorporation of the Corporation,
as herein amended, are hereby restated and integrated into the single
instrument which is hereinafter set forth, and which is entitled "Restated
Certificate of Incorporation of THE STROBER ORGANIZATION, INC.".
4. The amendments and the restatement of the Certificate of Incorporation
herein certified have been duly adopted by the stockholders in accordance with
the provisions of Sections 228, 242, and 245 of the General Corporation Law of
the State of Delaware.
5. The Certificate of Incorporation of the Corporation as amended and
restated herein, shall read as follows:
<PAGE>
RESTATED CERTIFICATE OF INCORPORATION
OF
THE STROBER ORGANIZATION, INC.
FIRST: The name of the corporation is THE STROBER ORGANIZATION, INC. (the
"Corporation").
SECOND: The registered office of the Corporation in the State of Delaware
is to be located at 32 Loockerman Square, Suite L-100, in the City of Dover,
County of Kent, State of Delaware 19901. The name of its registered agent at
that address is United States Corporation Company.
THIRD: The nature of the business or purposes to be conducted or promoted
by the Corporation is to engage in any lawful act or activity for which
corporations may be organized under the General Corporation Law of Delaware.
FOURTH: The aggregate number of shares of stock which the Corporation
shall have authority to issue is Twenty-One Million (21,000,000) shares, of
which Twenty Million (20,000,000) shall be Common Stock, par value one cent
($0.01) per share and One Million (1,000,000) shall be Preferred Stock, par
value one cent ($0.01) per share. The Preferred Stock shall have such voting
powers, full or limited, or no voting powers, and shall be issued in such
series and with such designations, powers, preferences and relative,
participating, optional or other special rights and qualifications, limitations
or restrictions thereof, as shall be stated and expressed in the resolution or
resolutions providing for the issuance of such stock adopted by the Board of
Directors, which shall have full authority to authorize the issuance of such
Preferred Stock from time to time.
FIFTH: The name and the mailing address of the sole incorporator is Peter
G. Samuels, Esq., Proskauer Rose Goetz & Mendelsohn, 300 Park Avenue, New York,
New York 10022.
SIXTH: The number of directors of the Corporation shall be the number
from time to time fixed by or in the manner provided in the By-Laws. Elections
of directors need not be by ballot unless the By-Laws of the 'Corporation shall
so provide.
SEVENTH: The entire Board of Directors shall consist of not less than
three (3) nor more than twenty (20) directors. Within these limits and subject
to the rights of the holders of any series of Preferred Stock to elect
additional directors under specified circumstances, the number of directors of
the Corporation shall be fixed from time to time exclusively by resolution of
the Board of Directors. The directors in office, other than those who may be
elected by the holders of any series of Preferred Stock under specified
circumstances, shall be divided, with respect to the time for which they
severally hold office, into three classes: Class I, Class II and Class III.
The term of office of the Class I directors will expire at the 1996 annual
meeting of stockholders, the term of office of the Class II directors will
expire at the 1997 annual meeting of stockholders, and the term of office of
the Class III directors will expire at the 1998 annual meeting of stockholders
following their election, and shall hold office until their successors have
been duly elected and qualified. At each annual meeting of stockholders,
commencing with the 1996 annual meeting, directors elected to succeed the
directors whose terms then expire shall be elected for a term of office to
expire at the third succeeding annual meeting of stockholders following their
election, and shall hold office until their successors have been duly elected
and qualified; provided however that a director may resign. If the number of
directors is not evenly divisible into thirds, the Board shall determine which
Class or Classes shall have one extra director. Any additional director of any
Class elected to the Board of Directors to fill a vacancy from an increase in
such Class shall hold office for the term that expires as to that Class. The
tenure of a Director shall not be affected by any decrease in the number of
directors so made by the Board. Subject to the rights of the holders of any
series of Preferred Stock, any directors or the entire Board of Directors may
be removed from office at any time but only for cause by the affirmative vote
of the holders of not less than 75% of the outstanding stock of the Corporation
entitled to vote in the election of directors. Any director may be removed
with cause at any time by the affirmative vote of the majority of directors in
office. The Board of Directors is expressly authorized to make, alter, amend
and repeal the By-laws of the Corporation. By-laws of the Corporation may also
be made, altered, amended or repealed by the stockholders, but only by the
affirmative vote of the holders of at least 75% of the outstanding stock of the
Corporation entitled to vote in the election of directors at a meeting of
stockholders duly held subject to the right of the Board of Directors to amend
or repeal any By-law adopted by the stockholders unless the By-law or any
provision thereof specifically states that it shall not be amended or repealed
by the Board of Directors in which case such By-law shall only be amended or
repealed by the affirmative vote of the holders of at least 75% of the
outstanding stock of the Corporation entitled to vote in the election of
directors.
EIGHTH: The Corporation shall, to the fullest extent permitted by law, as
the same is now or may hereafter be in effect, indemnify each person (including
the heirs, executors, administrators and other personal representatives of such
person) against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement, actually and reasonably incurred by such person in
connection with any threatened, pending or completed suit, action or proceeding
(whether civil, criminal, administrative or investigative in nature or
otherwise) in which such person may be involved by reason of the fact that he
or she is or was a director, officer, employee or agent of the Corporation or
is or was serving any other incorporated or unincorporated enterprise in any of
such capacities at the request of the Corporation. To the fullest extent
permitted by law, as the same is now or may hereafter be in effect, any such
expenses (including attorney's fees) may be paid by the Corporation in advance
of the final disposition of such suit, action or proceeding.
NINTH: To the fullest extent that elimination or limitation of the
liability of directors is permitted by law, as the same is now or may hereafter
be in effect, no director of the Corporation shall be liable to the Corporation
or its stockholders for monetary damages for breach of his or her fiduciary
duty as a director.
TENTH: The Corporation reserves the right to amend or repeal any
provisions contained in this Certificate of Incorporation in the manner now or
hereafter prescribed by law, and all rights and powers conferred herein on
stockholders, directors and officers are granted subject to this reservation.
ELEVENTH: Whenever a compromise or arrangement is proposed between the
Corporation and its creditors or any class of them and/or between the
Corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of the Corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for the Corporation under
the provisions of section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers
appointed for the Corporation under the provisions of section 279 of Title 8 of
the Delaware Code order a meeting of the creditors or class of creditors,
and/or of the stockholders or class of stockholders of the Corporation, as the
case may be, to be summoned in such manner as the said court directs. If a
majority in number representing three-fourths in value of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of the
Corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of the Corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of the Corporation, as the case may be,
and also on the Corporation.
TWELFTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Amended Certificate of Incorporation in
the manner now or hereafter prescribed by law, and all rights conferred on
stockholders herein are granted subject to this reservation.
In addition to any other requirements for amendments to the Certificate,
no amendment to this Certificate shall amend, alter, change or repeal any of
the provisions of Article SEVENTH or this Article TWELFTH unless the amendment
effecting such amendment, alteration, change or repeal shall have received the
affirmative approval of holders of shares of capital stock of the Corporation
entitled to cast at least 75% of the outstanding stock of the Corporation
entitled to vote in the election of directors; PROVIDED HOWEVER, that this
Article TWELFTH shall not apply to, and such 75% vote shall not be required to
amend, alter, change or repeal any provisions of this Article recommended by
not less than the two-thirds (2/3) of the Board of Directors.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
executed by its President and attested by its Secretary thereunto duly
authorized, who acknowledged and affirm under the penalties of perjury that
this Certificate is the act and deed of the Corporation and that the facts
herein are true, as of ________________.
THE STROBER ORGANIZATION, INC.
Attest:______________________ By:___________________________
David J. Polishook Robert J. Gaites
Secretary President
<PAGE>
Exhibit 3(ii)
<PAGE>
RESTATED BY-LAWS
OF
THE STROBER ORGANIZATION, INC.
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. ANNUAL MEETING. The annual meeting of the stockholders shall
be held at the principal office of the Company in Brooklyn, New York, or at
such other place as the Board of Directors shall determine, on a date and at a
time to be fixed by the Board of Directors, for the purpose of electing
directors and of transacting such other business as may properly be brought
before the meeting. The meeting may be adjourned from time to time until its
business is completed.
SECTION 2. SPECIAL MEETINGS. Special meetings of the stockholders may be
held at the principal office of the Company in Brooklyn, New York or at such
other place as the Board of Directors shall determine, upon the call of the
Board of Directors or the Chairman of the Board, at such time as may be fixed
by the Board of Directors or the Chairman of the Board, as the case may be, and
as may be stated in the call and notice. Any such notice shall be sent by the
Secretary of the Company or such other person as may be designated by the
person or persons calling such meeting. The meeting may be adjourned from time
to time until its business is completed.
SECTION 3. NOTICE OF MEETINGS. Written notice of the time, place and
purpose or purposes of every meeting of stockholders, signed by the Chairman of
the Board, the President, a Vice President, or the Secretary or an Assistant
Secretary, shall be served either personally or by mail, not less than ten nor
more than sixty days before the date of the meeting, upon each stockholder of
record entitled to vote at such meeting and upon each other stockholder of
record who, by reason of any action proposed at such meeting, would be entitled
to have his stock appraised if such action were taken. If mailed, such notice
shall be directed to each such stockholder at his address as it appears on the
stock book unless he shall have filed with the Secretary of the Company a
written request that notices intended for him be mailed to some other address,
in which case it shall be mailed to the address designated in such request.
Such further notice as may be required by the Certificate of Incorporation of
the Company or by law shall be given by mail, publication or otherwise, as
required.
SECTION 4. QUORUM. Except where otherwise provided by statute, at every
meeting of the stockholders the holders of record of shares entitled in the
aggregate to a majority of the number of votes which could at the time be cast
by the holders of all shares of the capital stock of the Company then
outstanding and entitled to vote if all such holders were present or
represented at the meeting, shall constitute a quorum. If at any meeting there
shall be no quorum, the holders of a majority of the shares of stock entitled
to vote so present or represented may adjourn the meeting to another time, or
place, or both, until such quorum shall have been obtained. No notice of the
adjourned meeting need be given if the time and place of the adjourned meeting
are announced at the meeting at which the adjournment is taken unless the
adjournment is for more than thirty days, or if after the adjournment a new
record date is fixed for the adjourned meeting. At an adjourned meeting the
Company may transact any business which might have been transacted at the
original meeting.
SECTION 5. ORGANIZATION. Except where otherwise provided by statute, the
Chairman of the Board, and in his absence the President, shall act as chairman
of such meeting. In the absence of the Chairman of the Board and the
President, a chairman shall be chosen by the stockholders present. The
Secretary of the Company shall act as Secretary at all meetings of the
stockholders but, in the absence of the Secretary, the presiding officer may
appoint any person to act as Secretary of the meeting.
SECTION 6. VOTING. At all meetings of the stockholders, each holder of
record of outstanding shares of stock of the Company, entitled to vote thereat,
may so vote either in person or by proxy appointed by instrument in writing
executed by such holder or by his duly authorized attorney. Except where
otherwise provided by statute, the Certificate of Incorporation or these By-
Laws, at any meeting of the stockholders at which a quorum is present in person
or by proxy, the vote of the holders of record of a majority of the shares of
stock of the Company present in person or by proxy, at the meeting and entitled
to vote shall be necessary and sufficient to constitute the act of the
stockholders of the Company.
SECTION 7. RECORD DATE. In order that the Company may determine the
stockholders entitled to notice of or to vote at any meeting of stockholders or
any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the purpose of
any other lawful action, the board of directors may fix, in advance, a record
date, which shall not be more than sixty nor less than ten days before the date
of such meeting, nor more than sixty days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Directors may fix a new record date for
the adjourned meeting.
SECTION 8. INSPECTORS OF ELECTION. At all elections of directors by the
stockholders the chairman of the meeting may, but need not, appoint two
inspectors of election. Before entering upon the discharge of his duties, each
such inspector shall take and subscribe an oath or affirmation faithfully to
execute the duties of inspector at such meeting with strict impartiality and
according to the best of his ability and thereupon the inspectors shall take
charge of the polls and after the balloting shall make a certificate of the
result of the vote taken. No director or candidate for the office of director
shall be appointed such inspector.
SECTION 9. ADVANCE NOTICE OF STOCKHOLDER-PROPOSED BUSINESS AT ANNUAL
MEETINGS. At any annual meeting of the stockholders, only such business shall
be conducted as shall have been properly brought before the meeting. To be
properly brought before an annual meeting, business must be specified in the
notice of meeting (or any supplement thereto) given by or at the direction of
the Board of Directors, otherwise properly brought before the meeting by or at
the direction of the Board of Directors, or otherwise properly brought before
the meeting by a stockholder. In addition to any other applicable
requirements, for business to be properly brought before an annual meeting by a
stockholder, the stockholder must have given timely notice thereof in writing
to the Secretary of the Company. To be timely, a stockholder's notice must be
delivered to or mailed and received at the principal executive offices of the
Company not less than ninety (90) days nor more than one hundred twenty (120)
days in advance of the date in the then current year corresponding to the date
the Company's proxy statement was released to stockholders in connection with
the previous year's annual meeting of stockholders, except that if no annual
meeting was held in the previous year of if the date of the annual meeting has
been changed by more than thirty (30) calendar days from any date contemplated
at the time of the previous year's proxy statement, notice by the stockholder
to be timely must be so received not later than the close of business on the
10th day following the day on which such notice of the date of the annual
meeting was mailed or prior public disclosure of the date of the meeting is
given or made to stockholders. A stockholder's notice to the Secretary shall
set forth as to each matter the stockholder proposes to being before the annual
meeting (i) a full description of the business desired to be brought before the
annual meeting and the reasons for conducting such business at the annual
meeting; (ii) the name and record address of the stockholder of record
proposing such business; (iii) the class and number of shares of the Company
which are beneficially owned and represented by proxy held by the stockholder
as of the record date of the meeting (if such date has been made publicly
available) and as of the date of such notice; (iv) any material interest of the
stockholder in such business; and (v) if so requested by the-Company, all other
information that would be required to be filed with the Securities and Exchange
Commission (the "SEC") if, with respect to the business proposed to be brought
before the meeting, the person proposing such business was a participant in a
solicitation subject to Regulation 14A of the Securities Exchange Act of 1934,
as amended (the "Exchange Act") or any successor thereto. Notwithstanding
anything in the By-laws to the contrary, no business shall be conducted at any
annual meeting except in accordance with the procedures set forth in this
Section 9, PROVIDED, HOWEVER, that nothing in this Section 9 shall be deemed to
preclude discussion by any stockholder of any business properly brought before
the annual meeting in accordance with said procedure. Notwithstanding the
foregoing provisions, unless otherwise required by law, the Board of Directors
shall not be obligated to include information as to any proposed business in
any proxy statement or other communication sent to stockholders. The Chairman
of an annual meeting shall, if the facts warrant, determine and declare to the
meeting that business was not properly brought before the meeting in accordance
with the foregoing provisions, and if he should so determine, he shall so
declare to the meeting and any such business not properly brought before the
meeting shall not be transacted.
SECTION 10. STOCKHOLDER NOMINATIONS OF DIRECTORS. Only persons who are
nominated in accordance with the following procedures shall be eligible for
election as Directors. Nominations of persons for election to the Board of
Directors may be made at a meeting of stockholders by or at the direction of
the Board of Directors, by any nominating committee or person appointed by the
Board of Directors or by any stockholder of the Company entitled to vote for
the election of Directors at the meeting who complies with the notice
procedures set forth in this Section 10. Such nominations, other than those
made by or at the direction of the Board of Directors, shall be made pursuant
to timely notice in writing to the Secretary of the Company. To be timely, a
stockholder's notice shall be delivered to or mailed and received at the
principal executive offices of the Company not less than ninety (90) days nor
more than one hundred twenty (120) days in advance of the date in the then
current year corresponding to the date the Company's proxy statement was
released to stockholders in connection with the previous year's annual meeting
of stockholders, except that if no annual meeting was held in the previous year
or if the date of the annual meeting has been changed by more than thirty (30)
calendar days from any date contemplated at the time of the previous year's
proxy statement, notice by the stockholder to be timely must be so received not
later than the close of business on the 10th day following the day on which
such notice of the date of the annual meeting was mailed or prior public
disclosure of the date of the meeting is given or made to stockholders. Such
stockholder's notice to the Secretary of the Company shall set forth (a) as to
each person whom the stockholder proposes to nominate for election or re-
election as a Director, (i) the name, age, business address and residence
address of the person; (ii) the principal occupation or employment of the
person; (iii) the class and number of shares of capital stock of the Company
which are beneficially owned by the person; (iv) any other information relating
to the person that is required to be disclosed in solicitations of proxies for
election of Directors pursuant to Regulation 14A under the Exchange Act; and
(v) any other information relating to the person that is required pursuant to
the rules of the national securities exchange or any other securities,
commodities or other exchange or market of which the is a member or pursuant to
any statute, or any rule or regulation of any governmental authority,
applicable to any other licenses held by the or any subsidiary; and (b) as to
the stockholder giving the notice (i) the name and record address of the
stockholder and (ii) the class and number of shares of capital stock of the
company which are beneficially owned and represented by proxy by the
stockholder. The Company may require any proposed nominee to furnish such
other information as may reasonably be required by the Company to determine the
eligibility of such proposed nominee to serve as a Director of the Company. No
person shall be eligible for election as a Director of the Company unless
nominated in accordance with the procedures set forth herein. The Chairman of
the meeting shall, if the facts warrant, determine and declare to the meeting
that a nomination was not made in accordance with the foregoing provisions, and
if he should so determine, he shall so declare to the meeting and the defective
nomination shall be disregarded.
SECTION 11. WRITTEN CONSENT IN LIEU OF MEETINGS. Unless otherwise
provided in the Certificate of Incorporation, any action required to be taken
at any annual or special meeting of stockholders of the Company, or any action
which may be taken at any annual or special meeting of such stockholders, may
be taken without a meeting, without prior notice and without a vote, if a
consent in writing, setting forth the action so taken, shall be signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted and shall be
delivered to the Company by delivery to its registered office in Delaware.
Delivery made to the Company's registered office shall be by hand or by
certified or registered mail, return receipt requested. Consents to corporate
action shall be valid for a maximum of sixty (60) days after the date of the
earliest dated consent delivered to the Company. Consents may be revoked by
written notice (i) to the Company; (ii) to the stockholders soliciting consents
or soliciting revocations in opposition to action by consent proposed by the
Company (the "Soliciting Stockholders"); or (iii) to a proxy solicitor or other
agent designated by the Company or the Soliciting Stockholders. Within three
(3) business days after receipt of the earliest dated consent delivered to the
Company or the determination by the Board of Directors that the Company should
seek corporate action by written consent, as the case may be, the Secretary
shall engage nationally recognized independent inspectors of elections or such
other inspectors of election as designated by the Board of Directors for the
purpose of performing a ministerial review of the validity of the consents and
revocations. The cost of retaining inspectors of election shall be borne by
the Company. Consents and revocations shall be delivered to the inspectors
upon receipt by the Company, the soliciting Stockholders or their proxy
solicitors or other designated agents. As soon as consents and revocations are
received, the inspectors shall review the consents and revocations and shall
maintain a count of the number of valid and unrevoked consents. As soon as
practicable after the earlier of (i) sixty (60) days after the date of the
earliest dated consent delivered to the Company or (ii) a written request
therefor by the Company or the Soliciting Stockholders (whichever is soliciting
consents), notice of which request shall be given to the party opposing the
solicitation of consents, if any, which request shall state that the Company or
Soliciting Stockholders, as the case may be, have a good faith belief that the
requisite number of valid and unrevoked consents to authorize or take the
action specified in the consents has been received in accordance with these By-
Laws, the inspectors shall issue a preliminary report to the Company and the
Soliciting Stockholders stating (i) the number of valid consents; (ii) the
number of valid revocations; (iii) the number of valid and unrevoked consents;
(iv) the number of invalid consents; (v) the number of invalid revocations;
(vi) whether, based on their preliminary count, the requisite number of valid
and unrevoked consents has been obtained to authorize or take the action
specified in the consents. Unless the Company and the Soliciting Stockholders
shall agree to a shorter or longer period, the company and the Soliciting
Stockholders shall have forty-eight (48) hours to review the consents and
revocations and to advise the inspectors and the opposing party in writing as
to whether they intend to challenge the preliminary report of the inspectors.
If no written notice of an intention to challenge the preliminary report is
received within forty-eight (48) hours after the inspectors' issuance of the
preliminary report, the inspectors shall issue to the Company and the
Soliciting Stockholders their final report containing the information from the
inspectors' determination with respect to whether the requisite number of valid
and unrevoked consents was obtained to authorize and take the action specified
in the consents. If the Company or the Soliciting Stockholders issue written
notice of an intention to challenge the inspectors' preliminary report within
forty-eight (48) hours after the issuance of that report, a challenge session
shall be scheduled by the inspectors as promptly as practicable. A transcript
of the challenge session shall be recorded by a certified court reporter.
Following completion of the challenge session, the inspectors shall as promptly
as practicable issue their final report to the Soliciting Stockholders and the
Company, which report shall contain the information included in the preliminary
report, plus all changes in the vote totals as a result of the challenge and a
certification of whether the requisite number of valid and unrevoked consents
was obtained to authorize or take the action specified in the consents. A Copy
of the final report of the inspectors shall be included in the Company minute
book. The Company shall give prompt notice to the stockholders of the results
of any consent solicitation or the taking of the corporate action without a
meeting and by less than unanimous written consent.
ARTICLE II
BOARD OF DIRECTORS
SECTION 1. NUMBER. The entire Board of Directors shall consist of not
less than three (3) nor more than twenty (20) directors. Within these limits
and subject to the rights of the holders of any series of Preferred Stock to
elect additional directors under specified circumstances, the number of
directors of the Corporation shall be fixed from time to time exclusively by
resolution of the Board of Directors. The directors in office, other than
those who may be elected by the holders of any series of Preferred Stock under
specified circumstances, shall be divided, with respect to the time for which
they severally hold office, into three classes: Class I, Class II and Class
III. The term of office of the Class I directors will expire at the 1996
annual meeting of stockholders, the term of office of the Class II directors
will expire at the 1997 annual meeting of stockholders, and the term of office
of the Class III directors will expire at the 1998 annual meeting of
stockholders following their election, and shall hold office until their
successors have been duly elected and qualified. At each annual meeting of
stockholders, commencing with the 1996 annual meeting, directors elected to
succeed the directors whose terms then expire shall be elected for a term of
office to expire at the third succeeding annual meeting of stockholders
following their election, and shall hold office until their successors have
been duly elected and qualified; provided however that a director may resign.
If the number of directors is not evenly divisible into thirds, the Board shall
determine which Class or Classes shall have one extra director. Any additional
director of any Class elected to the Board of Directors to fill a vacancy from
an increase in such Class shall hold office for the term that expires as to
that Class. The tenure of a Director shall not be affected by any decrease in
the number of directors so made by the Board.
SECTION 2. MEETINGS OF THE BOARD. Meetings of the Board of Directors
shall be held at such place within or without the State of Delaware as may from
time to time be fixed by resolution of the Board, or as may be specified in the
call of any meeting. Regular meetings of the Board of Directors shall be held
at such times as may from time to time be fixed by resolution of the Board.
Notice need not be given of the regular meetings of the Board held at times
fixed by resolution of the Board. Special meetings of the Board may be held at
any time upon the call of the Chairman of the Board or any four directors by
telegraphic, cable or written notice, duly served on or sent or mailed to each
director not less than two days before such meeting. Any such notice shall be
sent by the Secretary of the Company or such other person as may be designated
by the person or persons calling such meeting. Special meetings of the Board
of Directors may be held without notice, if all of the directors are present or
if those not present waive notice of the meeting in writing or by telegram or
cable.
SECTION 3. QUORUM. The attendance of a majority of the members of the
whole Board of Directors shall be necessary to constitute a quorum for the
transaction of business.
SECTION 4. VACANCIES. Vacancies in the Board of Directors may be filled
by a vote of a majority of the directors in office even though less than a
quorum, or by a sole remaining director.
SECTION 5. RESIGNATIONS. Any director of the Corporation may resign at
any time by giving written notice to the Chairman of the Board, the President
or to the Secretary of the Corporation. Such resignation shall take effect at
the time specified therein, and unless otherwise specified therein the
acceptance of such resignation shall not be necessary to make it effective.
SECTION 6. ORGANIZATION. The Board of Directors shall have general power
to direct the management of the business and affairs of the Corporation, and
may adopt such rules and regulations as they shall deem proper, not
inconsistent with law or with these By-laws, for the conduct of their meetings
and for the management of the business and affairs of the Company.
SECTION 7. REMOVAL. No director may be removed from office by the
stockholders except for cause with the affirmative vote of the holders of not
less than 75% of the total voting power of all outstanding securities of the
Corporation then entitled to vote generally in the election of directors,
voting together as a single class. Any director may be removed with cause at
any time by the affirmative vote of the majority of the directors in office.
ARTICLE III
COMMITTEES
SECTION 1. EXECUTIVE COMMITTEE. The Board of Directors may, by
resolution passed by a majority of the whole Board, designate an Executive
Committee to consist of two or more of the directors. The Executive Committee
shall have and may exercise, so far as may be permitted by law, all of the
powers of the Board in the direction of the management of the business and
affairs of the Company during the intervals between meetings of the Board of
Directors, and shall have power to authorize the seal of the Company to be
affixed to all papers which may require it; but the Executive Committee shall
not have power to fill vacancies in the Board, or to change the membership of,
or to fill vacancies in, the Executive Committee or to make or amend By-Laws of
the Company. The Board shall have the power any time to fill vacancies in, to
change the membership of, or to dissolve, the Executive Committee. The
Executive Committee may hold meetings and make rules for the conduct of its
business and appoint such committees and assistants as it shall from time to
time deem necessary. A majority of the members of the Executive Committee
shall constitute a quorum. All action of the Executive Committee shall be
reported to the Board at its meeting next succeeding such action.
SECTION 2. OTHER COMMITTEES. The Board of Directors may, in its
discretion, by resolution, appoint other committees, composed of two or more
members, which shall have and may exercise such powers as shall be conferred or
authorized by the resolution appointing them. A majority of any such committee
may determine its action and fix the time and place of its meetings, unless the
Board of Directors shall otherwise provide. The Board shall have power at any
time to fill vacancies in, to change the membership of or to dissolve, any such
committee.
<PAGE>
ARTICLE IV
OFFICERS
SECTION 1. OFFICERS. The Board of Directors, as soon as may be after the
election of directors held in each year, shall elect a Chairman of the Board, a
President, one or more Vice Presidents (including such number of Executive Vice
Presidents and/or Senior Vice Presidents as the Board determines), a Secretary
and a Treasurer, and from time to time may appoint such Assistant Secretaries,
Assistant Treasurers and such other officers, agents and employees as it may
deem proper. Any of such offices may be held by the same person. The Chairman
of the Board shall be chosen from among the directors, but no other officer
need be a director. The powers and functions of the Chief Executive Officer of
the Company shall be performed and exercised by the Chairman of the Board.
SECTION 2. TERM OF OFFICE. The term of office of all officers shall be
until the first meeting of the Board of Directors held immediately following
the next annual meeting of stockholders and until their respective successors
are elected and qualified; but at any time the Board may suspend or remove any
one or more of the officers, with or without cause, and the action thus taken
shall be conclusive. In the event of the suspension of an officer, the Board
shall fix the term of such suspension. Nothing herein shall be deemed to limit
the power or authority of the Chief Executive Officer of the Company in respect
of other officers of the Company.
SECTION 3. POWERS AND DUTIES. The officers, agents and employees of the
Company shall each have such powers and duties in the management of the
property and affairs of the Company, subject to the control of the Board of
Directors as generally pertain to their respective offices, as well as such
powers and duties as from time to time may be prescribed by the Board of
Directors. The Board of Directors may require any such officer, agent or
employee to give security for the faithful performance of his duties.
SECTION 4. RESIGNATIONS. Any officer of the Company may resign at any
time by giving written notice to the Chairman of the Board, the President, or
the Secretary of the Company. Such resignation shall take effect at the time
specified therein and unless otherwise specified therein the acceptance of such
resignation shall not be necessary to make it effective.
ARTICLE V
CAPITAL STOCK
SECTION 1. STOCK CERTIFICATES. The interest of each stockholder shall be
evidenced by a certificate or certificates for shares of stock of the Company
in such form as the Board of Directors may from time to time prescribe. The
certificates of stock shall be signed by the Chairman of the Board, the
President or a Vice President and the Treasurer or an Assistant Treasurer or
the Secretary or an Assistant Secretary and sealed with the seal of the
Company, and shall be countersigned and registered in such manner, if any, as
the Board may by resolution prescribe; provided that, in case such certificates
are required by such resolution to be signed by a Transfer Agent or Transfer
Clerk and by a Registrar, any and all signatures as well as the seal of the
Company upon such certificates, may be facsimiles, engraved or printed. In
case any such officer or Transfer Agent or Transfer Clerk whose facsimile
signature has been placed upon such certificate shall have ceased to be such
before such certificate is issued, it may be issued with the same effect as if
such officer, Transfer Agent or Transfer Clerk had not ceased to be such at the
date of its issue.
SECTION 2. TRANSFERS. Shares of capital stock of the Company shall be
transferred only on the books of the Company, by the holder thereof in person
or by his attorney, upon surrender for cancellation of certificates for the
same number of shares, with an assignment and power of transfer endorsed
thereon or attached thereto, duly executed, with such proof of the authenticity
of the signature as the Company or its agents may reasonably require. The
Board of Directors may from time to time appoint such Transfer Agents or
Registrars as it may deem advisable and may define their powers and duties.
SECTION 3. LOST OR DESTROYED STOCK CERTIFICATES. No certificates for
shares of stock of the Company shall be issued in place of any certificate
alleged to have been lost, stolen or destroyed, except upon production of such
evidence of the loss, theft or destruction and upon indemnification of the
Company and its agents to such extent and in such manner as the Company may
from time to time prescribe.
ARTICLE VI
FISCAL YEAR
The fiscal year of the Company for financial accounting purposes shall
commence on each January first and shall end on the next ensuing December
thirty-first, except as may be otherwise determined from time to time by the
Board.
ARTICLE VII
CORPORATE SEAL
The corporate seal shall have inscribed thereon the name of the Company
and the word "Delaware" arranged in a circular form around the words and
figures "Corporate Seal 1986". In lieu of the corporate seal, when so
authorized by the Board of Directors or a duly empowered committee thereof, a
facsimile thereof may be impressed or affixed or reproduced.
ARTICLE VIII
OFFICES AND BOOKS
SECTION 1. REGISTERED OFFICE. The registered office of the Company in
the State of Delaware shall be at c/o United States Corporation Company, 32
Loockerman Square, Suite L-100, Dover, Delaware 19901, except as may be
otherwise determined from time to time by the Board of Directors.
SECTION 2. OTHER OFFICES. The Board of Directors from time to time, and
at any time, may establish other offices and places of business of the Company
at whatever place or places within or without the State of Delaware, as may
seem to them expedient.
<PAGE>
ARTICLE IX
INDEMNIFICATION
The Company may implement the provisions of the Certificate of
Incorporation respecting indemnification of directors, officers, employees, and
agents of the Company and advancement of expenses (including attorney's fees)
actually and reasonably incurred by the directors and officers in connection
with any threatened, pending or completed action, suit or proceeding by
adopting such resolutions or by-laws, or causing the Company to enter into such
agreements, as the Board of Directors shall, from time to time, deem necessary.
ARTICLE X
AMENDMENT
The Board of Directors is expressly authorized to make, alter, amend and
repeal the By-laws of the Corporation. By-laws of the Corporation may also be
made, altered, amended or repealed by the stockholders, but only by the
affirmative vote of the holders of at least 75% of the outstanding stock of the
Corporation entitled to vote in the election of directors at a meeting of
stockholders duly held subject to the right of the Board of Directors to amend
or repeal any By-law adopted by the stockholders unless the By-law or any
provision thereof specifically states that it shall not be amended or repealed
by the Board of Directors in which case such By-law shall only be amended or
repealed by the affirmative vote of the holders of at least 75% of the
outstanding stock of the Corporation entitled to vote in the election of
directors. The Board of Directors may from time to time, by vote of a majority
of the Board, adopt, amend and repeal By-laws at any regular or special
meeting, provided notice of the proposed change is given in the notice of the
meeting, and subject to the power of the stockholders to amend and repeal any
By-laws made by the Board of Directors as provided in this Article. No
amendment or repeal of any By-law shall invalidate any prior act of the
directors or officers of the Corporation which would have been valid if the By-
law had not been so amended or repealed.
<PAGE>
Exhibit 27
Financial Data Schedule
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted
from the balance sheet and income statement of The Strober
Organization, Inc. for the three months ended June 30, 1995
</LEGEND>
<MULTIPLIER> 1,000
<CAPTION>
<S> <C> <C>
<PERIOD-TYPE> 6 Mos Qtr-2
<FISCAL-YEAR-END> Dec-31-95 Dec-31-95
<PERIOD-START> Jan-01-95 Apr-01-95
<PERIOD-END> Jun-30-95 Jun-30-95
<CASH> 3,876 3,876
<SECURITIES> 0 0
<RECEIVABLES> 20,521 20,521
<ALLOWANCES> 2,832 2,832
<INVENTORY> 11,838 11,838
<CURRENT-ASSETS> 34,640 34,640
<PP&E> 12,916 12,916
<DEPRECIATION> 9,706 9,706
<TOTAL-ASSETS> 45,309 45,309
<CURRENT-LIABILITIES> 12,038 12,038
<BONDS> 0 0
<COMMON> 6,589 6,589
<Perferred-Mandatory> 0 0
0 0
<OTHER-SE> 25,334 25,334
<TOTAL-LIABILITY-AND-EQUITY> 45,305 45,305
<SALES> 62,202 34,035
<Total-Revenue> 62,202 34,035
<CGS> 46,002 25,225
<TOTAL-COSTS> 60,200 32,386
<Other Expenses> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> (77) (26)
<INCOME-PRETAX> 2,079 1,675
<INCOME-TAX> 852 687
<INCOME-CONTINUING> 1,227 988
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 1,227 988
<EPS-PRIMARY> 0.24 0.19
<EPS-DILUTED> 0.24 0.19
</TABLE>
