SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
Commission File Number 1-1430
REYNOLDS METALS COMPANY
A Delaware Corporation
(IRS Employer Identification No. 54-0355135)
6601 West Broad Street, P. O. Box 27003, Richmond, Virginia 23261-7003
Telephone: (804) 281-2000
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
- ------------------- -----------------------
Common Stock, no par value New York Stock Exchange
Chicago Stock Exchange
Preferred Stock Purchase Rights New York Stock Exchange
Chicago Stock Exchange
7% PRIDES(SM), Convertible Preferred Stock New York Stock Exchange
Chicago Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
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, and (2) has been subject to such filing
requirements for the past 90 days. Yes __X__ No ___
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. __X__
As of February 20, 1996:
(a) the aggregate market value of the voting stock held by nonaffiliates of
the Registrant was approximately $2.58 billion*.
(b) the Registrant had 63,604,494 shares of Common Stock outstanding and
entitled to vote.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Proxy Statement for the Annual Meeting of Stockholders to be
held on April 17, 1996 - Part III
_____________________
* For this purpose, "nonaffiliates" are deemed to be persons other than
directors, officers and persons owning beneficially more than five percent
of the voting stock. The amount reported includes the market value of
8,594,400 shares of 7% PRIDES, Convertible Preferred Stock, each entitled
to 4/5 of a vote.
NOTE
In accordance with the Securities and Exchange Commission's requirements, we
will furnish copies of the exhibits listed below upon payment of a fee of 10
cents per page. Please remit the proper amount with your request to:
Secretary
Reynolds Metals Company
P.O. Box 27003
Richmond, Virginia 23261-7003
Exhibits have the following number of pages:
EXHIBIT 3.1 71 EXHIBIT 10.12 12
EXHIBIT 3.2 16 EXHIBIT 10.13 13
EXHIBIT 4.1 71 EXHIBIT 10.14 2
EXHIBIT 4.2 16 EXHIBIT 10.15 1
EXHIBIT 4.3 165 EXHIBIT 10.16 1
EXHIBIT 4.4 6 EXHIBIT 10.17 4
EXHIBIT 4.5 74 EXHIBIT 10.18 3
EXHIBIT 4.6 2 EXHIBIT 10.19 3
EXHIBIT 4.7 2 EXHIBIT 10.20 3
EXHIBIT 4.8 2 EXHIBIT 10.21 3
EXHIBIT 4.9 2 EXHIBIT 10.22 2
EXHIBIT 4.10 10 EXHIBIT 10.23 1
EXHIBIT 4.11 14 EXHIBIT 10.24 10
EXHIBIT 4.12 9 EXHIBIT 10.25 10
EXHIBIT 4.13 36 EXHIBIT 10.26 13
EXHIBIT 4.14 24 EXHIBIT 10.27 6
EXHIBIT 4.15 18 EXHIBIT 10.28 2
EXHIBIT 4.16 24 EXHIBIT 10.29 2
EXHIBIT 4.17 89 EXHIBIT 10.30 1
EXHIBIT 4.18 7 EXHIBIT 10.31 3
EXHIBIT 4.19 12 EXHIBIT 10.32 3
EXHIBIT 10.1 21 EXHIBIT 10.33 2
EXHIBIT 10.2 16 EXHIBIT 10.34 10
EXHIBIT 10.3 19 EXHIBIT 10.35 10
EXHIBIT 10.4 7 EXHIBIT 10.36 10
EXHIBIT 10.5 2 EXHIBIT 10.37 10
EXHIBIT 10.6 7 EXHIBIT 10.38 10
EXHIBIT 10.7 6 EXHIBIT 23 1
EXHIBIT 10.8 10 EXHIBIT 24 31
EXHIBIT 10.9 14 EXHIBIT 27 1
EXHIBIT 10.10 7
EXHIBIT 10.11 7
TABLE OF CONTENTS
PART I
ITEM PAGE
1. BUSINESS................................................... 1
GENERAL................................................. 1
COMPETITION............................................. 5
Principal Competitors................................ 5
Industry Conditions.................................. 5
RAW MATERIALS........................................... 5
Bauxite, Alumina and Related Materials............... 5
Australia......................................... 6
Brazil............................................ 6
Guinea............................................ 6
Guyana............................................ 6
Jamaica........................................... 6
ALUMINUM PRODUCTION..................................... 7
FABRICATING OPERATIONS.................................. 8
ENERGY.................................................. 10
ENVIRONMENTAL COMPLIANCE................................ 10
RESEARCH AND DEVELOPMENT................................ 12
EMPLOYEES............................................... 12
2. PROPERTIES................................................. 15
3. LEGAL PROCEEDINGS.......................................... 17
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS........ 18
4A. EXECUTIVE OFFICERS OF THE REGISTRANT....................... 19
PART II
5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS........................................ 21
6. SELECTED FINANCIAL DATA.................................... 22
7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS........................ 23
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA................ 33
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE..................... 54
PART III
10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT......... 54
11. EXECUTIVE COMPENSATION..................................... 54
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT............................................. 54
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS............. 54
PART IV
14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
ON FORM 8-K................................................ 55
PART I
Item 1. BUSINESS
Reynolds Metals Company (the "Registrant") was incorporated in 1928 under the
laws of the State of Delaware. As used herein, "Reynolds" and "Company" each
means the Registrant and its consolidated subsidiaries unless otherwise
indicated.
GENERAL
Reynolds is a leading global aluminum and packaging company. Reynolds serves
global markets as a supplier and recycler of aluminum and other products, with
its core business being as a vertically integrated producer of a wide variety
of value-added aluminum products. Reynolds produces alumina, carbon products
and primary and reclaimed aluminum, principally to supply the needs of its
fabricating operations. These fabricating operations produce aluminum foil,
sheet, plate, beverage cans, extruded products (including heat exchanger
tubing, drive shafts, bumpers and window systems), flexible packaging and
wheels, among other items. Reynolds also produces a broad range of plastic
products, including film, bags, containers and lids, for consumer products,
foodservice and packaging uses. The Company markets an extensive line of
consumer products under the Reynolds brand name, including the well-known
Reynolds Wrap aluminum foil. Reynolds' largest market for its products is the
packaging and containers market, which includes consumer products. The Company
also is engaged in the distribution of aluminum and stainless steel and other
non-aluminum industrial products to a variety of markets. Reynolds operates a
one-of-a-kind facility that converts spent potliner from Reynolds' and other
producers' North American aluminum smelting operations into an environmentally
safe material with potential for recycling.
To describe more fully the nature of its operations, Reynolds has separated its
vertically integrated operations into two areas -- (1) Finished Products and
Other Sales and (2) Production and Processing.
Finished Products and Other Sales includes the manufacture and distribution of
various finished aluminum products, such as beverage cans, containers, flexible
packaging products, foodservice and household foils (including Reynolds Wrap),
laminated and printed foil and aluminum building products and the distribution
of aluminum and stainless steel and other non-aluminum industrial products.
Finished Products and Other Sales also includes the manufacture and sale of
plastic bags and food wraps (for example, Reynolds Plastic Wrap, Reynolds
Crystal Color Plastic Wrap, Reynolds Oven Bags and Presto disposer bags),
plastic lidding and container products, plastic film packaging, Reynolds
Freezer Paper, Reynolds Baker's Choice baking cups, Reynolds Cut-Rite wax paper
and wax paper sandwich bags, composite and non-aluminum building products, and
printing cylinders and machinery.
Production and Processing includes the refining of bauxite into alumina,
calcination of petroleum coke and production of prebaked carbon anodes, all of
which are vertically integrated with aluminum production and processing plants.
These plants produce and sell primary and reclaimed aluminum and a wide range
of semifinished aluminum mill products, including flat rolled products,
extruded and drawn products, cast products and other aluminum products.
Examples of flat rolled products include aluminum can sheet and machined plate.
Examples of extruded and drawn products include heat exchanger tubing, drive
shafts and bumpers. Examples of cast products include aluminum wheels.
Production and Processing also includes the treatment of spent potliner and the
sale of non-aluminum products, technology and various licensing, engineering
and other services related to the production and processing of aluminum.
In March, 1995, Reynolds completed the sale of its wholly owned subsidiary,
Reynolds Australian Gold Operations, Ltd. ("RAGOL") to Sons of Gwalia Ltd. and
Camelot Resources N.L., both of Australia. RAGOL held Reynolds' principal gold
mining assets remaining after Reynolds' 1994 sale of Reynolds Australia Metals,
Ltd., which held a 40% interest in the Boddington Gold Mine in Western
Australia. The Company had been a gold producer through its operations in
Western Australia since 1986.
Reynolds acquired Alcan Aluminum Corporation's laminated foil plant in
Louisville, Kentucky in June, 1995. The plant laminates aluminum foil onto
paper and primarily serves the flexible packaging needs of the tobacco and
pharmaceutical industries. Reynolds is operating the plant as part of its
Flexible Packaging Division.
Also in June, 1995, Reynolds acquired Wilson Engraving Company, Inc., which
operates manufacturing plants in Dallas, Texas and West Monroe, Louisiana.
Wilson Engraving Company, Inc. prepares film and manufactures printing plates
and is being operated as an affiliate of Southern Graphic Systems, Inc.,
Reynolds' wholly owned manufacturer of printing cylinders and engravings for
the rotogravure, flexographic and lithographic printing industries.
In October, 1995, Reynolds acquired an additional 24.95% interest in the
Becancour, Quebec, Canada, primary aluminum production plant from Societe
Generale de financement du Quebec, an agency of the Government of Quebec. The
acquisition increased Reynolds' interest in the Becancour joint venture to 50%.
At current production levels, the acquisition provides Reynolds an additional
93,000 metric tons of the joint venture's primary aluminum annual output for a
total of 186,000 metric tons, and increases Reynolds' worldwide primary
aluminum production capacity to approximately 1.09 million metric tons per
year.
Reynolds acquired the flexible packaging manufacturing operations of Hargro
Flexible Packaging Corp. in Boyertown, Pennsylvania in December, 1995. The
operations produce flexographic printed film and film laminations, primarily
for the healthcare, confectionery and snack industries, and are being managed
as part of Reynolds' Flexible Packaging Division.
In another December, 1995 acquisition, Reynolds purchased the Canadian Cut-Rite
brand from Scott Paper Company, and other wax paper brands from Scott Paper
Company's Canadian affiliate, Scott Paper Limited. The acquisition enables
Reynolds, through its Reynolds Aluminum Company of Canada, Ltd. subsidiary, to
market Cut-Rite wax paper throughout Canada. Reynolds acquired Scott Paper
Company's Cut-Rite trademark rights except for Canada in 1986.
Reynolds closed its aluminum beverage can manufacturing plant in Fulton, New
York in December, 1995. Because of productivity gains throughout Reynolds' can
system, a geographic shift in customer demand and slower overall growth in U.S.
demand for aluminum cans, the Fulton plant's 1-billion-can capacity exceeded
the needs of Reynolds' customers.
Information on shipments and net sales by classes of similar products is shown
in Table 1. Net sales are in millions of dollars; shipments are in thousands
of metric tons.
<PAGE>
<TABLE>
<CAPTION>
TABLE 1
Net Sales and Shipments
1995 1994
1993
- -------------------------------------------------------------------
Net Net
Net
Shipments Sales Shipments Sales
Shipments Sales
--------- ------- --------- -------
- --------- ------
<S> <C> <C> <C> <C>
<C> <C>
Finished Products and Other Sales
- ---------------------------------
Packaging and containers
Aluminum 368 $1,871 359 $1,583
268 $1,262
Nonaluminum 556 529
511
Other aluminum 163 580 151 449
124 359
Other nonaluminum 528 479
396
- -------------------------------------------------------------------
531 3,535 510 3,040
392 2,528
- -------------------------------------------------------------------
Production and Processing
- -------------------------
Primary aluminum 346 684 277 440
309 380
Sheet and plate 409 1,350 418 1,003
452 1,063
Extrusions 200 765 211 627
183 526
Other aluminum 179 494 157 391
158 352
Other nonaluminum 385 378
420
- -------------------------------------------------------------------
1,134 3,678 1,063 2,839
1,102 2,741
- -------------------------------------------------------------------
Total 1,665 $7,213 1,573 $5,879
1,494 $5,269
===================================================================
Average realized price per pound:
- ---------------------------------
Fabricated aluminum products $1.84 $1.48
$1.45
Primary aluminum 0.90 0.72
0.56
</TABLE>
<PAGE>
Financial information relating to Reynolds' operations and identifiable assets
by major operating and geographic areas is presented in Note L to the
consolidated financial statements in Item 8 of this report.
Reynolds' products generally are sold to producers and distributors of
industrial and consumer products in various markets. Information on sales of
products by principal geographic and business markets is shown in Tables 2 and
3.
<TABLE>
<CAPTION>
TABLE 2
Principal Geographic Markets
Approximate
Percentage of Sales
------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
United States 77% 77% 75%
Canada 7 6 6
Other (Principally Europe) 16 17 19
---- ---- ----
Total 100% 100% 100%
</TABLE>
<TABLE>
<CAPTION>
TABLE 3
Principal Business Markets
Approximate
Percentage of Sales
--------------------------
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Packaging and Containers 44% 45% 45%
Automotive and Transportation 13 12 11
Distributors and Fabricators 13 13 13
Building and Construction 13 13 12
Other 17 17 19
---- ---- ----
Total 100% 100% 100%
</TABLE>
COMPETITION
Principal Competitors
- ---------------------
Reynolds' principal competitors in the sale in North America of products
derived from primary aluminum are ten other domestic companies, a Canadian
company and other foreign producers. Reynolds and many other companies produce
reclaimed aluminum.
In the sale of semifinished and finished products, Reynolds competes with (i)
other producers of primary and reclaimed aluminum, which are also engaged in
fabrication, (ii) other fabricators of aluminum and other products, (iii) other
producers of plastic products and (iv) metals service center companies engaged
in the distribution of aluminum and other products. Reynolds' principal
competitors in Europe are seven major multinational producers and a number of
smaller European producers of aluminum semifabricated products. In the
aluminum beverage can business, Reynolds competes worldwide with four major
producers and a number of smaller ones. Aluminum and related products compete
with various products, including those made of iron, steel, copper, zinc, tin,
titanium, lead, glass, wood, plastic, magnesium and paper. Plastic products
compete with products made of glass, aluminum, steel, paper, wood and ceramics,
among others. Competition is based upon price, quality and service.
Industry Conditions
- -------------------
A worldwide oversupply of aluminum, caused by high exports beginning in 1990
from the Commonwealth of Independent States ("CIS") (mostly from Russia),
start-up of substantial new capacity in the industry and economic weakness,
severely depressed the price of aluminum on world commodity markets in the
early 1990's, affecting the aluminum industry and the Company. Multilateral
government negotiations were commenced in late 1993 to develop strategies to
integrate the CIS aluminum industries into the world market. A Memorandum of
Understanding ("MOU") relating to primary aluminum supply-demand conditions and
international trade in aluminum was agreed to by the governments of six major
aluminum producing countries in March, 1994, and has since expired. See the
discussion in Note L to the consolidated financial statements in Item 8, and
under "Results of Operations - Aluminum Industry" and "Outlook and Strategy" in
Item 7, of this report with respect to current industry conditions.
RAW MATERIALS
Bauxite, Alumina and Related Materials
- --------------------------------------
Bauxite, the principal raw material used in the production of aluminum, is
refined into alumina, which is then reduced by an electrolytic process into
primary aluminum.
Reynolds' bauxite requirements and a portion of its alumina requirements are
met from sources outside the United States.
Reynolds has long-term arrangements to obtain bauxite at negotiated prices from
sources in Australia, Brazil, Guinea and Guyana, and is finalizing such an
arrangement as to Jamaican bauxite. Reynolds also has a long-term arrangement
with the U.S. government under which Reynolds has agreed to purchase at a
negotiated price an aggregate of approximately 1,000,000 long dry tons of
Jamaican bauxite stored next to Reynolds' Sherwin alumina plant near Corpus
Christi, Texas, for the period 1996 through 1998.
Reynolds refines bauxite into alumina at its Sherwin alumina plant. Reynolds
also acquires alumina from two joint ventures in which it has interests, one
located in Western Australia, known as the Worsley Joint Venture ("Worsley"),
and the other located in Stade, Germany, known as Aluminium Oxid Stade
("Stade"). See Table 4 under this Item and the discussion of Worsley under
"Australia".
Production and purchases of bauxite and production of alumina are adjusted from
time to time in response to changes in demand for primary aluminum and other
factors. Reynolds had reduced production at its Sherwin plant in connection
with the curtailment of operations at its U.S. primary aluminum production
plants. See "Aluminum Production". Although the curtailment of such operations
continues, the idle alumina capacity at the Sherwin plant was restarted during
1995 due to strong demand in the alumina market.
Australia
Worsley has a rated capacity of 1,700,000 metric tons of alumina per year
(expandable to 3,200,000 metric tons per year). Worsley has proven
bauxite reserves sufficient to operate the alumina plant at its rated
capacity (taking into account future expansions to increase rated capacity
to up to 3,200,000 metric tons per year) for at least the next 35 years.
The joint venture has no specified termination date.
Reynolds has a long-term purchase arrangement under which it may purchase
from a third party an aggregate of approximately 18,800,000 dry metric
tons of Australian bauxite through 2021. Of this amount, Reynolds has
agreed to purchase 1,000,000 dry metric tons in 1996.
Brazil
Reynolds and various other companies are participants in the Trombetas
bauxite mining project in Brazil. Reynolds has a 5% equity interest in
the project and has agreed to purchase an aggregate of approximately
1,600,000 dry metric tons of Brazilian bauxite from the project for the
period 1996 through 1999.
Reynolds also maintains an interest in other, undeveloped bauxite deposits
in Brazil.
<PAGE>
Guinea
Reynolds owns a 6% interest in Halco (Mining), Inc. ("Halco"). Halco owns
51% and the Guinean government owns 49% of Compagnie des Bauxites de
Guinee ("CBG"), which has the exclusive right through 2038 to develop and
mine bauxite in a 10,000 square-mile area in northwestern Guinea.
Reynolds has a bauxite purchase contract with CBG which will provide
Reynolds with an aggregate of approximately 8,250,000 dry metric tons of
Guinean bauxite for the period 1996 through 2011.
Guyana
Reynolds and the Guyanese government each owns a 50% interest in a bauxite
mining project in the Berbice region of Guyana. Reynolds has a bauxite
purchase contract running through 1998 under which it will purchase
approximately 1,200,000 dry metric tons of Guyanese bauxite from the
project in 1996. Quantities to be purchased in 1997 and 1998 are to be
agreed upon at the beginning of each contract year.
Jamaica
Reynolds is finalizing a purchase arrangement under which it will agree to
purchase from a third party an aggregate of up to 9,000,000 dry metric
tons of Jamaican bauxite for the period 1996 through 2000.
Reynolds' present sources of bauxite and alumina are more than adequate to meet
the forecasted requirements of its primary aluminum production operations for
the foreseeable future. To utilize excess alumina capacity, Reynolds enters
into third-party sales arrangements. Reynolds also enters into arrangements to
sell bauxite in excess of its needs to third parties.
Other materials used in making aluminum are either purchased from others or
supplied from Reynolds' carbon products plants in Baton Rouge and Lake Charles,
Louisiana.
ALUMINUM PRODUCTION
Reynolds owns and operates three primary aluminum production plants in the
United States and one located at Baie Comeau, Quebec, Canada. Reynolds is also
entitled to a share of the primary aluminum produced at three joint ventures in
which it participates, one located in Quebec, Canada, known as the Becancour
joint venture ("Becancour"), one located in Hamburg, Germany, known as
Hamburger Aluminium-Werk GmbH ("Hamburg"), and the third in Ghana, Africa,
known as Volta Aluminium Company Limited ("Ghana"). See Table 5 (and related
notes) under this Item for information on these primary aluminum production
plants. Reynolds also buys primary aluminum on the open market.
In October, 1995, Reynolds acquired an additional 24.95% interest in Becancour
from Societe Generale de financement du Quebec, an agency of the Government of
Quebec, increasing Reynolds' interest in Becancour to 50%. At current
production levels, the acquisition provides Reynolds an additional 93,000
metric tons of Becancour's annual primary aluminum output for a total of
186,000 metric tons, and increases its worldwide primary aluminum capacity to
1,094,000 metric tons per year.
Production at the primary aluminum plants listed in Table 5 can vary due to a
number of factors, including changes in worldwide supply and demand. Due to
the worldwide aluminum supply-demand imbalance, Reynolds has idled a total of
209,000 metric tons, or 19%, of its 1,094,000 metric tons of primary aluminum
capacity. Reynolds temporarily shut down 88,000 metric tons of primary
aluminum production capacity at its Massena, New York (41,000 metric tons) and
Longview, Washington (47,000 metric tons) plants, effective in the fourth
quarter of 1993, and its Troutdale, Oregon plant, with a capacity of 121,000
metric tons, has been idle since 1991. At December 31, 1995, the U.S. plants
listed in Table 5 were operating collectively at a rate of 53% of capacity;
Ghana (in which Reynolds has a 10% equity interest), where production has been
curtailed by drought (see "Energy") since September, 1994, was operating at 70%
of capacity; and all other plants listed in Table 5 were operating at full
capacity. See Table 6 under this Item. In order to balance its alumina supply
system, Reynolds had temporarily reduced production at its Sherwin alumina
plant in Texas in connection with the curtailments. The idle alumina capacity
at the Sherwin plant was restarted during 1995. See "Raw Materials - Bauxite,
Alumina and Related Materials".
Reynolds has an 8% equity interest in C.V.G. Aluminio del Caroni, S.A., which
produces primary aluminum in Venezuela.
Reynolds has agreed to acquire a 10% equity interest in the Aluminum Smelter
Company of Nigeria (ALSCON), with the Nigerian government and private interests
holding the remaining equity. As part of the arrangement, Reynolds will
purchase at market-related prices 140,000 metric tons of primary aluminum
annually from a 180,000 metric ton smelter being constructed by ALSCON in
Nigeria.
Reynolds produces reclaimed aluminum from aluminum scrap at its facilities
located in Bellwood, Virginia and Sheffield, Alabama, and at a facility in
which it has a 99.8% equity interest located in Isernia, Italy. See Table 6
under this Item. Scrap for the U.S. facilities is obtained through Reynolds'
nationwide recycling network and other scrap purchases and from Reynolds'
manufacturing operations. Scrap for the Italian facility is obtained through
scrap purchases. In 1995, Reynolds obtained approximately 276,100 metric tons
of recycled aluminum from its recycling network and other scrap purchases.
FABRICATING OPERATIONS
Reynolds' semifinished and finished aluminum products and non-aluminum products
are produced at numerous domestic and foreign plants wholly or partly owned by
Reynolds. These plants are included in Table 7 under Item 2 of this report.
The annual capacity of these plants depends upon the variety and type of
products manufactured.
In line with its strategic emphasis on growth opportunities in its core
downstream fabricating operations serving the aluminum beverage can, packaging,
consumer products, transportation, and building and construction markets,
Reynolds has over the past three years continued to upgrade and modernize its
beverage can, flexible packaging, foil, plastics, extrusion, sheet and plate
manufacturing facilities, particularly facilities for production of such
value-added products as can sheet, packaging, household foil and components for
the transportation industry. Specific actions the Company has taken include
the following:
Aluminum Beverage Cans
- ----------------------
- -- developed new types of, and applications for, aluminum cans;
- -- acquired in 1993 Miller Brewing Company's aluminum can and end
manufacturing operations, increasing its U.S. can-making capacity by
almost 50%;
- -- commercialized in 1993 Spin Flow can necking technology (developed by
Reynolds in conjunction with Ball Corporation) for forming the neck of
aluminum cans at high speeds;
- -- acquired in 1994 Bev-Pak, Inc. and its aluminum beverage can and end
manufacturing facility in Monticello, Indiana, increasing the Company's
U.S. aluminum can- and end-making capacity by approximately 15 and 20
percent, respectively;
- -- completed in 1994 a 70% expansion of its Tampa can plant;
- -- completed in 1995 an expansion of a joint venture facility to produce
aluminum cans and announced plans for the construction of a joint venture
can end plant, both in Brazil;
- -- in 1995 completed construction of, and began operations at, two joint
venture can plants, one in Brazil and one in Chile; and
- -- continued in 1995 its participation in the construction of joint venture
can plants in Brazil (the third in that country), Argentina (which has
begun production) and Saudi Arabia.
Packaging
- ---------
- -- increased PVC film capacity by 20% in 1992-1993 to serve the growing
Reynolon shrink film as well as consumer and foodservice film markets;
- -- acquired in 1994 assets to expand its printing cylinder and engraving
business and, in 1995, acquired Wilson Engraving Company Inc.,
strengthening the Company's ability to meet the needs of flexographic and
lithographic printers and extending the Company's geographic reach by
adding plants in Louisiana and Texas;
- -- began in 1995 an expansion at its Grottoes, Virginia plastics
manufacturing plant that will increase capacity by approximately 20%;
- -- began in 1995 a major, multi-year capital program to build a new aluminum
foil rolling mill at its Louisville, Kentucky plant that will increase
annual plant capacity by about 25%;
- -- acquired in 1995 a laminated foil plant in Louisville, Kentucky,
strengthening the Company's ability to serve the flexible packaging needs
of the tobacco and pharmaceutical industries; and
- -- acquired in 1995 the flexible packaging manufacturing operations of Hargro
Flexible Packaging Corp. in Boyertown, Pennsylvania, establishing a major
position in flexographic printing and increasing the Company's capacity to
produce printed film and film laminations.
Consumer Products
- -----------------
- -- substantially increased marketing support behind its Reynolds Wrap and
Reynolds Plastic Wrap brands;
- -- introduced in 1993 new products, including a complete line of Diamond
plastic wraps and bags for selected international markets;
- -- acquired in 1995 the Canadian Cut-Rite brand from Scott Paper Company, and
other wax paper brands from Scott Paper Company's Canadian affiliate,
Scott Paper Limited, enabling the Company to market Cut-Rite wax paper
throughout Canada, a key market for Reynolds' consumer products;
- -- introduced in 1995 a 50-foot Heavy Duty line extension of its Reynolds
Wrap brand, two printed plastic wrap products and several new Reynolds
Baker's Choice baking cup products; and
- -- in 1995 expanded its consumer products business in Latin America, the
Middle East and the Far East.
Transportation
- --------------
- -- restructured in 1994 its McCook plant in Illinois, exiting common alloy
sheet products and emphasizing plate and automotive sheet;
- -- began production in 1994 of aluminum automotive extruded components at a
new fabricating plant in Auburn, Indiana and began an expansion of the
plant in 1995;
- -- commercialized in 1995, for aerospace applications, aluminum-lithium plate
products manufactured at its McCook plant in Illinois and aluminum-lithium
extrusions manufactured by its Extrusion Division; and
- -- began manufacturing in 1995 aluminum wheels at a facility in Beloit,
Wisconsin, which it purchased in 1994 and modified and equipped for that
purpose.
Building and Construction
- -------------------------
- -- increased its investment in manufacturing equipment and facilities for
composite, vinyl and plastic building products.
Other
- -----
- -- acquired in 1994 the metals distribution business of Prime Metals, Inc.,
allowing the Company to broaden the geographic processing and service
capabilities of its Reynolds Aluminum Supply Company metals distribution
business; and
- -- purchased in 1995 the aluminum extrusion operations of AMAG Austria's
wholly owned subsidiary, Wexal International Ltd., in Ireland.
ENERGY
Reynolds consumes substantial amounts of energy in refining bauxite into
alumina and in reducing alumina to aluminum.
Alumina is produced by a process requiring high temperatures at various stages.
These temperatures are achieved by burning natural gas or coal at the alumina
plants. Natural gas and coal are purchased under long- and short-term
contracts. See Table 4 under this Item.
Primary aluminum is produced from alumina by an electrolytic process requiring
large amounts of electric power. Electricity required for Reynolds' primary
aluminum production plants generally is purchased under long-term contracts.
See Table 5 under this Item.
Reynolds expects generally to meet its energy requirements for primary aluminum
production for the foreseeable future under long-term contracts. Under these
contracts, however, Reynolds may experience shortages of interruptible power
from time to time at its Washington, Oregon, New York and Ghana reduction
plants. Production at Ghana is dependent on hydroelectric power and has from
time to time been curtailed by drought.
Rates for electricity charged by the Bonneville Power Administration ("BPA"),
which serves the Company's Troutdale, Oregon and Longview, Washington primary
aluminum production plants, have been settled through October, 1996, with a
four percent increase over the prior rate. The Company and BPA have entered
into a new five-year contract that would supersede the existing power contract
for the period October, 1996 - September, 2001 (when the existing contract was
due to expire). The new contract establishes a fixed rate, which is 16% less
than rates now in effect, that would apply for the entire term of the new
contract. This contract is, however, subject to review and approval both in
BPA's currently pending rate case and in a subsequent review process conducted
by the Federal Energy Regulatory Commission. Further, as part of a BPA rate
decision, the contract is subject to appeal in the courts by third parties.
Should the new contract be rejected in any of these processes, the Company
could continue service under the existing contract, renegotiate with BPA, or
contract for competitive power supplied by third parties.
ENVIRONMENTAL COMPLIANCE
Reynolds has spent and will spend substantial capital and operating amounts
relating to ongoing compliance with environmental laws. The area of
environmental management, including environmental controls, continues to be in
a state of scientific, technological and regulatory evolution. Consequently,
it is not possible for Reynolds to predict accurately the total expenditures
necessary to meet all future environmental requirements. Reynolds expects,
however, to add or modify environmental control facilities at a number of its
worldwide locations to meet existing and certain anticipated regulatory
requirements, including regulations to be implemented under the Clean Air Act
Amendments of 1990 (the "Clean Air Act").
Based on information currently available, Reynolds estimates that compliance
with the Clean Air Act's hazardous air pollutant standards would require in
excess of $250 million of capital expenditures (including a portion of the
expenditures at Reynolds' Massena plant referred to below), primarily at
Reynolds' U.S. primary aluminum production plants. The ultimate effect of the
Clean Air Act on such plants and Reynolds' other operations (and the actual
amount of any such capital expenditures) will depend on how the Clean Air Act
is interpreted and implemented pursuant to regulations that are currently being
developed and on such additional factors as the evolution of environmental
control technologies and the economic viability of such operations at the time.
Based on an August, 1995 memorandum of understanding with the State of New
York to resolve environmental issues at its Massena, New York primary aluminum
production plant, Reynolds has begun a five-year capital spending program of an
estimated $150 million to $200 million to modernize the Massena plant and
significantly reduce air emissions from the plant. Pursuant to the memorandum
of understanding, Reynolds is accelerating certain expenditures believed
necessary to achieve compliance with the Clean Air Act's Maximum Achievable
Control Technology standards, although the U.S. Environmental Protection Agency
(the "EPA") is still developing such standards. (See the related discussion in
Item 3 of this report.)
Capital expenditures for equipment designed for environmental control purposes
were approximately $55 million in 1993, $34 million in 1994 and $39 million in
1995. The portion of such amounts expended in the United States was $43
million in 1993, $15 million in 1994 and $18 million in 1995. Expenditures in
1993 and 1994 included $19 million and $1 million, respectively, for
construction of Reynolds' facility in Arkansas that converts spent potliner
from Reynolds' and other producers' aluminum smelting operations into an
environmentally safe material with potential for recycling. Reynolds estimates
that annual capital expenditures for environmental control facilities will be
approximately $53 million in 1996, $98 million in 1997 and $82 million in 1998,
the majority of such expenditures being associated with the capital spending
program referred to above at Reynolds' Massena plant. Future capital
expenditures for environmental control facilities cannot be predicted with
accuracy for the reasons cited above; however, it may be expected that
environmental control standards will become increasingly stringent and that the
expenditures necessary to comply with them could increase substantially.
Reynolds has been identified as a potentially responsible party ("PRP") and is
involved in remedial investigations and remedial actions under the
Comprehensive Environmental Response, Compensation and Liability Act
("Superfund") and similar state laws regarding the past disposal of wastes at
approximately 40 sites in the United States. Such statutes may impose joint
and several liability for the costs of such remedial investigations and actions
on the entities that arranged for disposal of the wastes, the waste
transporters that selected the disposal sites and the owners and operators of
such sites; responsible parties (or any one of them) may be required to bear
all of such costs regardless of fault, legality of the original disposal or
ownership of the disposal site. In addition, Reynolds is investigating
possible environmental contamination, which may also require remedial action,
at certain of its present and former United States manufacturing facilities,
including contamination by polychlorinated biphenyls ("PCBs") at its Massena,
New York primary aluminum production plant which requires remediation. In
1994, the EPA added Reynolds' Troutdale, Oregon primary aluminum production
plant to the National Priorities List of Superfund sites; the Company is
cooperating with the EPA and, under a September, 1995 consent order, is working
with the EPA in investigating potential environmental contamination at the
Troutdale site and to promote more efficient cleanup at the site. At most of
the 40 sites referred to above where Reynolds has been identified as a PRP, it
is one of many PRPs, and its share of the anticipated cleanup costs is expected
to be small. With respect to certain other sites (not included in the
foregoing number) where Reynolds has been identified as a PRP, Reynolds has
either fully or substantially settled or resolved actions related to such sites
at minimal cost or believes that it has no responsibility with regard to them.
Reynolds has been notified that it may be a PRP at certain additional sites.
Reynolds' policy is to accrue remediation costs when it is probable that
remedial efforts will be required and the related costs can be reasonably
estimated. On a quarterly basis, Reynolds evaluates the status of all sites,
develops or revises estimates of costs to satisfy known remediation
requirements and adjusts its accruals accordingly. At December 31, 1995, the
accrual for known remediation requirements was $242 million. This amount
reflects management's best estimate of Reynolds' ultimate liability for such
costs. Potential insurance recoveries are uncertain and therefore have not
been considered. As a result of such factors as the developing nature of
administrative standards promulgated under Superfund and other environmental
laws; the unavailability of information regarding the condition of potential
sites; the lack of standards and information for use in the apportionment of
remedial responsibilities; the numerous choices and costs associated with
diverse technologies that may be used in remedial actions at such sites; the
availability of insurance coverage; the ability to recover indemnification or
contribution from third parties; and the time periods over which eventual
remediation may occur, estimated costs for future environmental compliance and
remediation are necessarily imprecise. It is not possible to predict the
amount or timing of future costs of environmental remediation which may
subsequently be determined. Based on information currently available, it is
management's opinion that such future costs are not likely to have a material
adverse effect on Reynolds' competitive or financial position or its ongoing
results of operations. However, such costs could be material to future
quarterly or annual results of operations.
See the discussion under "Environmental" in Item 7, and under Note J to the
consolidated financial statements in Item 8, of this report regarding the
Company's anticipated costs of environmental compliance.
RESEARCH AND DEVELOPMENT
Reynolds engages in a continuous program of basic and applied research and
development. This program deals with new and improved materials, products,
processes and related environmental compliance technologies. It includes the
development and expansion of products and markets which benefit from aluminum's
light weight, strength, resistance to corrosion, ease of fabrication, high heat
and electrical conductivity, recyclability and other properties. Materials and
core competencies involving aluminum, ceramics, composites and various polymers
and their processing, fabrication and applications are also included in the
scope of Reynolds' research and development activity. Expenditures for
Reynolds-sponsored research and development activities were approximately $36
million in 1993, $38 million in 1994 and $43 million in 1995.
Reynolds owns numerous patents relating to its products and processes based
predominantly upon its in-house research and development activities. The
patents owned by Reynolds, or under which it is licensed, generally concern
particular products or manufacturing techniques. Reynolds' business is not,
however, materially dependent on patents.
EMPLOYEES
At December 31, 1995, Reynolds had approximately 29,800 employees. Labor
contracts between Reynolds and the United Steelworkers of America and the
Aluminum, Brick and Glass Workers International Union, respectively, entered
into in 1993 will expire by their terms in May, 1996. The contracts involve
approximately 7,000 employees.
<TABLE>
<CAPTION>
TABLE 4
Alumina Plants and Energy Supply
Rated
Capacity(a) at Principal
December 31, 1995 Energy Energy Contract
Plant Metric Tons Purchased(b) Expiration Date
- ----- ----------------- ------------ ---------------
<S> <C> <C> <C>
Corpus Christi, Texas 1,600,000(c) Natural Gas 1996(d)
Worsley, Australia 952,000(e) Coal 2002
Stade, Germany 375,000(e) Natural Gas 2008
</TABLE>
<TABLE>
<CAPTION>
TABLE 5
Primary Aluminum Production Plants and Energy Supply
Rated
Capacity(a) at Principal
December 31, 1995 Energy Energy Contract
Plant Metric Tons Purchased(b) Expiration Date
- ----- ----------------- ------------ ---------------
<S> <C> <C> <C>
Baie Comeau, Canada 400,000 Electricity 2011 and 2014
Longview, Washington 204,000(f) Electricity 2001
Massena, New York 123,000(f) Electricity 2013(g)
Troutdale, Oregon 121,000(f) Electricity 2001
Becancour, Canada 186,000(h) Electricity 2014
Hamburg, Germany 40,000(h) Electricity 2000
Ghana, Africa 20,000(h) Electricity 1997(i)
</TABLE>
<TABLE>
<CAPTION>
TABLE 6
Aluminum Capacity and Production
(Metric Tons)
Primary Aluminum(j) Reclaimed Aluminum(k)
------------------------------- -------------------------
Rated Rated
Year Capacity(a),(f) Production(f) Capacity(a) Production
- ---- --------------- ------------- ----------- ----------
<S> <C> <C> <C> <C>
1993 991,000 869,000 462,000 386,000
1994 998,000 792,000 491,000 409,000
1995 1,094,000 814,500 485,500 396,500
</TABLE>
NOTES TO TABLES 4, 5, and 6.
(a) Ratings are estimates at the end of the period based on designed capacity
and normal operating efficiencies and do not necessarily represent maximum
possible production.
(b) See "Energy".
(c) In order to balance its alumina supply system, Reynolds had reduced
production at its Sherwin alumina plant near Corpus Christi, Texas in
connection with the curtailment of operations at its U.S. primary aluminum
plants. Although the curtailment of such operations continues, the idle
alumina capacity at the Sherwin plant was restarted during 1995. See
"Aluminum Production".
(d) Approximately 50% of the plant's natural gas requirements is purchased
under a one-year contract and the remainder is purchased under other
short-term contracts. The base term of the one-year contract referred to
above will conclude in October, 1996, but the contract will extend from
month to month unless terminated by one of the parties.
(e) Reynolds is entitled to 56% of the production of Worsley and 50% of the
production of Stade. Capacity figures reflect Reynolds' share.
(f) Reynolds curtailed 70,500 metric tons of production at its Troutdale
primary aluminum plant in the third quarter of 1991 and the remainder of
the plant's capacity in the fourth quarter of 1991. The Troutdale plant
remains idle. Reynolds curtailed an aggregate of 88,000 metric tons of
primary aluminum production capacity at its Massena (41,000 metric tons)
and Longview (47,000 metric tons) plants effective in the fourth quarter
of 1993. See "Aluminum Production".
(g) The power contract terminates in 2013, subject to earlier termination by
the supplier in 2003 if its federal license for a hydroelectric project is
not renewed.
(h) Reynolds is entitled to 50% of the production of Becancour, 33-1/3% of the
production of Hamburg, and 10% of the production of Ghana. Capacity
figures reflect Reynolds' share. Production at Ghana has been curtailed
since September, 1994 by drought. See "Aluminum Production" and "Energy".
At December 31, 1995, Ghana was operating at 70% of capacity.
(i) The power contract provides for a 20-year extension at the option of the
smelter owners.
(j) Production is from Reynolds' primary aluminum production operations listed
in Table 5.
(k) Production through the second quarter of 1993 is from Reynolds' Bellwood,
Virginia; Sheffield, Alabama; and Benton Harbor, Michigan reclamation
facilities. Reynolds sold its Benton Harbor, Michigan facility in the
second quarter of 1993. Production in 1994 and 1995 includes the Isernia,
Italy reclamation facility, in which Reynolds has a 99.8% equity interest.
Item 2. PROPERTIES
For information on the location and general nature of Reynolds' principal
domestic and foreign properties, see Item 1, BUSINESS. Table 7 lists as of
February 15, 1996 Reynolds' wholly-owned domestic and foreign operations and
shows the domestic and foreign locations of operations in which Reynolds has
interests. Facilities that are under construction or for other reasons have
not begun production are not listed. The properties listed are held in fee
except as otherwise indicated. Properties held other than in fee are not,
individually or in the aggregate, material to Reynolds' operations and the
arrangements under which such properties are held are not expected to limit
their use. Reynolds believes that its facilities are suitable and adequate for
its operations. With the exception of the Longview, Massena, Troutdale and
Ghana primary aluminum production plants, as explained above, there is no
significant surplus or idle capacity at any of Reynolds' major manufacturing
facilities.
TABLE 7
Wholly-Owned Operations
Manufacturing, Mining and Distribution
Alumina: Recycling:
Corpus Christi, Texas Recycling Plants and Centers (U.S.)(698)**
Malakoff, Texas
Calcined Coke: Reclamation:
Baton Rouge, Louisiana Sheffield, Alabama (2)
Lake Charles, Louisiana Bellwood, Virginia
Carbon Anodes: Mill Products:
Lake Charles, Louisiana Sheffield, Alabama
McCook, Illinois
Primary Aluminum: Bellwood, Virginia
Massena, New York Cap-de-la-Madeleine,
Troutdale, Oregon Quebec, Canada
Longview, Washington Hamburg, Germany***
Baie Comeau, Quebec, Canada Latina, Italy
Aluminum Beverage Cans:
Spent Potliner Treatment: San Francisco, California
Gum Springs, Arkansas Torrance, California
Tampa, Florida
Extruded Products: Moultrie, Georgia
Auburn, Indiana Honolulu, Hawaii
Louisville, Kentucky Monticello, Indiana (cans and ends)
El Campo, Texas Kansas City, Missouri
Ashland, Virginia* Middletown, New York
Bellwood, Virginia Reidsville, North Carolina (cans and ends)
Richmond Hill, Ontario, Canada Salisbury, North Carolina
Ste. Therese, Quebec, Canada Fort Worth, Texas
Nachrodt, Germany Houston, Texas
Wexford, Ireland Seattle, Washington
Harderwijk, Netherlands Milwaukee, Wisconsin
Lelystad, Netherlands Rocklin, California (ends)
Maracay, Venezuela Bristol, Virginia (ends)
Guayama, Puerto Rico
Powder and Paste: Printing Cylinders:
Louisville, Kentucky Longmont, Colorado*
Atlanta, Georgia*
Electrical Rod: Clarksville, Indiana*
Becancour, Quebec, Canada Louisville, Kentucky (2)
Newport, Kentucky*
West Monroe, Louisiana
Foil Feed Stock: Battle Creek, Michigan*
Hot Springs, Arkansas St. Louis, Missouri
Fulton, New York*
Packaging and Consumer Wilmington, North Carolina*
Products: Exton, Pennsylvania*
Beacon Falls, Connecticut Franklin, Tennessee*
Louisville, Kentucky(2) Dallas, Texas
Mt. Vernon, Kentucky Richmond, Virginia (2)
Sparks, Nevada* Toronto, Ontario, Canada
Boyertown, Pennsylvania(3)*
Downingtown, Pennsylvania
Lewiston, Utah Reynolds Aluminum Supply
Bellwood, Virginia Company:
Grottoes, Virginia Service Centers (U.S.)(27)**
Richmond, Virginia Processing Centers (U.S.)(3)**
South Boston, Virginia
Appleton, Wisconsin (2)
Little Chute, Wisconsin Research and Development
Weyauwega, Wisconsin
Rexdale, Ontario, Canada* Richmond, Virginia:
Cap-de-la-Madeleine, Can Division Headquarters
Quebec, Canada Corporate Research
Latina, Italy and Development
Central Laboratories
Building and Construction Packaging Technology
Products:
Eastman, Georgia*
Bourbon, Indiana Corpus Christi, Texas:
Ashville, Ohio Alumina Technology
Lynchburg, Virginia
Weston, Ontario, Canada
Merxheim, France* Sheffield, Alabama:
Nachrodt, Germany Manufacturing Technology
Dublin, Ireland* Laboratory
Wexford, Ireland
Harderwijk, Netherlands
Lisburn, Northern Ireland*
Service Centers (U.S.)(51)**
Service Centers (Canada) (11)**
Wheels:
Beloit, Wisconsin
Ferrara, Italy
Can Machinery and Systems:
Richmond, Virginia
Other Operations
In Which Reynolds Has Interests
Argentina: Ghana:
Aluminum cans, recycling Primary aluminum*
Australia: Guinea:
Bauxite, alumina Bauxite
Belgium: Guyana:
Building products, extrusions Bauxite*
Brazil: India:
Bauxite, aluminum cans Extrusions
and ends, recycling, reclamation
Italy:
Canada: Reclamation
Primary aluminum, electric
power generation, aluminum Russia:
wheels Foil
Chile: Spain:
Aluminum cans, recycling Mill products, extrusions, foil,
packaging and consumer products,
Colombia: printing cylinders
Mill products, extrusions,
foil Venezuela:
Primary aluminum, mill products,
Egypt: foil, aluminum cans and ends,
Extrusions recycling, aluminum wheels
Germany:
Alumina, primary aluminum*
____________________________
* Leased.
** Recycling Plants and Centers - 689 leased.
Building and Construction Products Service Centers - 60 leased.
Reynolds Aluminum Supply Company Service Centers - 18 leased.
Reynolds Aluminum Supply Company Processing Centers - 1 leased.
*** Held under an installment purchase arrangement.
The titles to Reynolds' various properties were not examined specifically for
this report.
Item 3. LEGAL PROCEEDINGS
On June 10, 1988, the Atlantic States Legal Foundation ("Atlantic States")
filed suit against the Registrant in the U.S. District Court for the Western
District of New York (the "Court") under the "citizen suit" provision of the
federal Clean Water Act. The State of New York intervened in the case on
December 1, 1989. The suit involved the discharge of substances from the
Registrant's Massena, New York primary aluminum production plant. An agreement
of the parties to settle the suit for payments by the Registrant aggregating
$515,000, resolving claims for penalties and other costs, was approved by the
Court on May 12, 1992; however, the Court retained jurisdiction of the matter.
In a letter dated April 12, 1993, Atlantic States informed the Registrant that
it has withdrawn its waiver of enforcement, citing violations at the Massena
plant of interim effluent limits contained in the settlement agreement and
other effluent limit violations. Atlantic States has stated that it would be
providing the Registrant a settlement offer concerning such violations, which
the Registrant to date has not received.
On November 9, 1993, counsel for the St. Regis Mohawk Tribe (the "Tribe")
served the Registrant with a notice of intent to file a citizen suit for
alleged violations of the federal Clean Air Act and certain New York state air
emission standards at the Registrant's Massena, New York primary aluminum
production plant. Subsequently, the State of New York alleged that the
Registrant's emissions were causing a violation of certain state air emission
standards. In October, 1994, based on an agreement in principle with the State
to resolve environmental issues at the plant, the Registrant approved a
five-year capital spending program of an estimated $150 million to $200 million
to modernize the Massena plant and significantly reduce air emissions from the
plant. In August, 1995, the Registrant and the State of New York formalized the
agreement in principle in a memorandum of understanding, and the Registrant has
begun the work included in the capital spending program. The Registrant is
accelerating certain expenditures believed necessary to achieve compliance with
the MACT standards, although the EPA is still developing such standards. The
Registrant and the Tribe reached an agreement in November, 1995 to resolve
issues relating to the Massena plant's air emissions and certain other
environmental matters at the plant. Under the agreement, the Registrant will,
in order to promote continued communication and to foster good will between the
Tribe and the Registrant, complete the capital spending program referred to
above, contribute $1.65 million to establish a perpetual scholarship fund for
the Tribe, fund a $250,000 air sampling program to be developed by the Tribe
and pay $100,000 for past and future legal fees and expenses. See the
discussion of Clean Air Act compliance costs in Item 1 under the caption
"Environmental Compliance".
The Registrant received from the U.S. Department of Justice (i) on August 29,
1994, a civil investigative demand relating to production of primary aluminum
and (ii) on March 30, 1995, a civil investigative demand relating to the
pricing of aluminum can stock. The Registrant is cooperating with both
inquiries and is confident that its conduct has been in compliance with U.S.
antitrust laws.
A private antitrust lawsuit styled Hammons v. Alcan Aluminum Corp. et al.,
seeking estimated damages of approximately $13 billion, was filed in the
Superior Court of California for the County of Los Angeles on March 5, 1996
against the Registrant and other aluminum producers. The lawsuit alleges a
conspiracy to reduce worldwide and U.S. aluminum production. The Registrant
has made, and will make, its decisions regarding production levels independent-
ly. As noted above, the Registrant is confident that its conduct has been in
compliance with the antitrust laws.
Various other suits and claims are pending against Reynolds. In the opinion of
Reynolds' management, after consultation with counsel, disposition of these
suits and claims and the actions referred to in the preceding paragraphs,
either individually or in the aggregate, will not have a material adverse
effect on Reynolds' competitive or financial position or its ongoing results of
operations. No assurance can be given, however, that the disposition of one or
more of such suits, claims or actions in a particular reporting period will not
be material in relation to the reported results for such period.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the Registrant's security holders during
the fourth quarter of 1995.
Item 4A. EXECUTIVE OFFICERS OF THE REGISTRANT
The executive officers of the Registrant are as follows:
Name Age* Positions Held During Past Five Years
- ---- ---- -----------------------------------------
Richard G. Holder 64 Chairman of the Board and Chief Executive
Officer since May 1992. President and
Chief Operating Officer 1988-1992.
Director since 1984.
Randolph N. Reynolds** 54 Vice Chairman since January 1994.
Executive Vice President, International
1990-1994. President, Reynolds
International, Inc. ("RII"), a subsidiary
of the Company, since November 1980, and
Chief Executive Officer of RII since
November 1981. Director since 1984.
Jeremiah J. Sheehan 57 President and Chief Operating Officer since
January 1994. Executive Vice President,
Fabricated Products 1993-1994. Executive
Vice President, Consumer and Packaging
Products 1990-1993. Director since January
1994.
Henry S. Savedge, Jr. 62 Executive Vice President and Chief
Financial Officer since May 1992. Vice
President, Finance 1990-1992. Director
since 1992.
J. Wilt Wagner 54 Executive Vice President, Raw Materials,
Metals and Industrial Products since March
1993. Executive Vice President, Fabricated
Industrial Products 1992-1993. Vice
President, Mill Products Division 1990-
1992.
James R. Aitken 61 Vice President since April 1994. Executive
Vice President, RII since March 1993. Vice
President, Europe of RII and President,
Reynolds (Europe) Ltd., a subsidiary of
RII, 1987-1993.
Thomas P. Christino 56 Vice President, Flexible Packaging Division
since November 1993. Flexible Packaging
Division General Manager 1992-1993.
Flexible Packaging Products National Sales
and Marketing Manager 1987-1992.
Donald T. Cowles 48 Vice President and Reynolds Aluminum Supply
Company Division General Manager since
August 1995. Executive Vice President,
Human Resources and External Affairs
1993-1995. Vice President, General Counsel
and Secretary 1989-1993.
Eugene M. Desvernine 54 Vice President since April 1994. Executive
Vice President, RII since March 1993. Vice
President, Latin America of RII 1982-1993.
Allen M. Earehart 53 Vice President, Controller since April
1994. Controller 1993-1994. Director,
Corporate Accounting 1982-1993.
E. Jack Gates 54 Vice President, Raw Materials and Carbon
Products Division since April 1993. Raw
Materials and Precious Metals Division
General Manager 1993. Reduction Division
General Manager 1990-1993.
Rodney E. Hanneman 59 Vice President, Quality Assurance and
Technology Operations since March 1985.
Paul S. Hayden 53 Vice President, Recycling Division since
April 1995. Recycling Division General
Manager 1991-1995.
Douglas M. Jerrold 45 Vice President, Tax Affairs since April
1990.
D. Michael Jones 42 Vice President, General Counsel and
Secretary since February 1993. Associate
General Counsel and Assistant Secretary
1990-1993.
John B. Kelzer 59 Vice President, Extrusion Division since
April 1993. Extrusion Division General
Manager 1990-1993.
William E. Leahey, Jr. 46 Vice President, Can Division since April
1993. Can Division General Manager 1992-
1993. Can Division Sales and Marketing
Director 1990-1992.
John M. Lowrie 55 Vice President, Consumer Products Division
since October 1988.
F. Robert Newman 52 Vice President, Human Resources since
October 1995. Corporate Director, Human
Resources 1993-1995. Corporate Director,
Industrial Relations 1992-1993. Director,
Industrial Relations Operations 1986-1992.
John M. Noonan 62 Vice President, Construction Products and
Properties Divisions since January 1984.
Paul Ratki 56 Vice President, Metals Division since April
1994. Reduction and Reclamation Division
General Manager 1993-1994. Reduction and
Reclamation Division Operations Manager
1991-1993.
William G. Reynolds, Jr.** 56 Vice President, Government Relations and
Public Affairs since 1980.
John F. Rudin 50 Vice President, Chief Information Officer
since August 1995. Vice President since
April 1995. Reynolds Aluminum Supply
Company Division General Manager 1989-1995.
Julian H. Taylor 52 Vice President, Treasurer since April 1988.
C. Stephen Thomas 56 Vice President, Mill Products Division
since May 1992. Vice President, Can
Division 1990-1992.
Nicholas D. Triano 64 Vice President, Materials Management since
April 1989.
_______________
* As of February 17, 1996
** Randolph N. Reynolds and William G. Reynolds, Jr. are brothers.
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Registrant's Common Stock is listed on the New York Stock Exchange and the
Chicago Stock Exchange. At February 20, 1996, there were 9,666 holders of
record of the Registrant's Common Stock.
The high and low sales prices for shares of the Registrant's Common Stock as
reported on the New York Stock Exchange Composite Transactions Tape and the
dividends declared per share during the periods indicated are set forth below:
<TABLE>
<CAPTION>
High Low Dividends
---- --- ---------
1995
<S> <C> <C> <C>
First Quarter $ 56-1/2 $ 46-1/4 $.25
Second Quarter 52-3/8 46-3/4 .30
Third Quarter 64-3/4 51-5/8 .30
Fourth Quarter 58-5/8 48-1/2 .35
1994
First Quarter $ 54-5/8 $ 44-7/8 $.25
Second Quarter 50-5/8 40-3/8 .25
Third Quarter 58 47-1/4 .25
Fourth Quarter 59-3/8 44-3/4 .25
</TABLE>
On February 16, 1996, the Board of Directors declared a dividend of $.35 per
share of Common Stock, payable April 1, 1996 to stockholders of record on
March 1, 1996.
Item 6. SELECTED FINANCIAL DATA
- ------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
Consolidated Income Statement (In millions, except per share amounts)
- ----------------------------------------------------------------------
1995 1994 1993
1992 1991
- ------------------------------------------------------
<S> <C> <C> <C>
<C> <C>
Net sales $7,213 $5,879 $5,269
$5,593 $5,730
Equity, interest and other income 39 46 25
28 54
Gains on sales of assets - 88 -
36 -
- ------------------------------------------------------
7,252 6,013 5,294
5,657 5,784
- ------------------------------------------------------
Cost of products sold 5,772 4,996 4,657
4,762 4,760
Selling, administrative and
general expenses 449 376 358
369 378
Provision for depreciation and amortization 311 295 287
284 265
Interest expense 172 156 159
167 161
Operational restructuring and asset
revaluation costs - - 348
106 -
Provision for estimated
environmental costs - - -
164 -
- ------------------------------------------------------
6,704 5,823 5,809
5,852 5,564
- ------------------------------------------------------
Income (loss) before income taxes
and cumulative effects of
accounting changes 548 190 ( 515)
( 195) 220
Taxes on income (credit) 159 68 (193)
(86) 66
- ------------------------------------------------------
Income (loss) before cumulative
effects of accounting changes 389 122 ( 322)
( 109) 154
Cumulative effects of accounting
changes (1) - - -
(640) -
- ------------------------------------------------------
Net income (loss) $ 389 $ 122 ($ 322)
($ 749) $ 154
======================================================
Earnings per share
Primary earnings (losses) $5.35 $1.42 $(5.38)
$(12.56) $2.60
======================================================
Cash dividends declared
======================================================
per common share $1.20 $1.00 $1.20
$1.80 $1.80
======================================================
Other items:
Total assets $7,740 $7,461 6,709
$6,897 $6,685
======================================================
Long-term debt $1,853 $1,848 $1,990
$1,798 $1,854
======================================================
</TABLE>
[FN]
(1) In 1992, the Company adopted FAS No. 106, requiring accrual accounting for
postretirement benefits other than pensions, and FAS No. 109, which
requires use of the liability method of determining deferred income taxes.
Charges of $610 million (FAS No. 106) and $30 million (FAS No. 109) were
recognized in 1992 for the cumulative effects of these accounting changes.
The adoption of FAS No. 109 enabled the Company to fully recognize the
deferred tax benefits associated with the adoption of FAS No. 106.
[/FN]
<PAGE>
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following information should be read in conjunction with the consolidated
financial statements, related notes and other sections of this report. In the
tables, dollars are in millions, except per share and per pound amounts, and
shipments are in thousands of metric tons. A metric ton is equivalent to 2,205
pounds.
- -------------------------------------------------------------------------------
RESULTS OF OPERATIONS
The Company had a very successful year in 1995 with record shipments and
revenues and the third-highest net income in the Company's history. These
results reflect continued strength in overall global demand for aluminum
products, improved prices and actions the Company has taken to improve
operating performance such as acquisitions, divestitures, restructurings and
cost reductions. The Company achieved these results despite weaker market
conditions in the second half of the year and with approximately 20% of its
primary aluminum capacity temporarily idled. The overall improved performance
and optimistic long-term outlook for the aluminum business led the Company to
increase the dividend on its common stock in 1995 at an annual rate of 40%.
<PAGE>
<TABLE>
<CAPTION>
1995 1994
1993
- -----------------------------------
<S> <C> <C>
<C>
Net income (loss) $389 $122
$(322)
Net income (loss) includes special items:
Gains on sales of assets - 57
-
Operational restructuring and asset revaluation costs - -
(227)
Earnings (loss) per share $5.35 $1.42
$(5.38)
Earnings (loss) per share includes special items:
Gains on sales of assets - .92
-
Operational restructuring and asset revaluation costs - -
(3.80)
</TABLE>
ALUMINUM INDUSTRY
The aluminum industry turned in a strong performance in 1995, particularly in
the first half of the year, due to improved aluminum supply/demand
fundamentals. Prices for both primary and fabricated aluminum products
improved from their recent depressed lows. Industry shipments increased in
late 1994 and early 1995, largely as a result of hedge buying by end-users
anticipating price increases. The hedge buying occurred primarily in the
aluminum beverage can and distributor markets. This created a customer
inventory buildup, which resulted in lower shipments to these markets during
the second half of 1995 as excess inventories were starting to be reduced.
Additionally, the soft landing of the U.S. and European economies that occurred
in 1995 led to lower shipments to some markets, particularly construction and
automotive. The inventory liquidation process and the economic soft landing
led to lower primary aluminum prices in the latter part of 1995.
<PAGE>
<TABLE>
SHIPMENTS AND NET SALES
<CAPTION>
1995 1994
1993
- ---------------------------------------------------------
Net Net
Net
Shipments Sales Shipments Sales
Shipments Sales
--------- ----- --------- -----
- --------- -----
<S> <C> <C> <C> <C> <C>
<C>
Finished Products and Other Sales
- ---------------------------------
Packaging and containers
Aluminum 368 $1,871 359 $1,583 268
$1,262
Nonaluminum 556 529
511
Other aluminum 163 580 151 449 124
359
Other nonaluminum 528 479
396
- ---------------------------------------------------------
531 3,535 510 3,040 392
2,528
- ---------------------------------------------------------
Production and Processing
- -------------------------
Primary aluminum 346 684 277 440 309
380
Sheet and plate 409 1,350 418 1,003 452
1,063
Extrusions 200 765 211 627 183
526
Other aluminum 179 494 157 391 158
352
Other nonaluminum 385 378
420
- ---------------------------------------------------------
1,134 3,678 1,063 2,839 1,102
2,741
- ---------------------------------------------------------
Total 1,665 $7,213 1,573 5,879 1,494
$5,269
=========================================================
Average realized price per pound:
- --------------------------------
Fabricated aluminum products $1.84 $1.48
$1.45
Primary aluminum 0.90 0.72
0.56
</TABLE>
Finished Products and Other Sales
- ---------------------------------
Aluminum packaging and container shipments increased in 1995 and 1994,
principally due to additional aluminum beverage can and end shipments resulting
primarily from acquisitions in late 1993 and mid-1994.
The increases in other aluminum shipments in 1995 and 1994 resulted from the
1994 acquisition of a metals distribution company and strong demand in the
distribution market in 1994.
Production and Processing
- -------------------------
Primary aluminum shipments fluctuate from year to year because of variations in
internal requirements and changes in customer demand for value-added foundry
ingot and billet. The acquisition of an additional interest in the Becancour,
Quebec primary aluminum production facility contributed to the increase in
1995. The decrease in 1994 resulted from a decision to idle 88 thousand metric
tons of primary aluminum capacity late in 1993 due to weak aluminum
supply/demand fundamentals at that time.
Shipments of sheet and plate were slightly lower in 1995 compared to 1994, as
higher can stock shipments were offset by lower shipments of other sheet
products. The increase in can stock shipments resulted from higher shipments
to the growing operations of the Company's partially owned aluminum beverage
can operations in Latin America. Shipments of other sheet products decreased
due to the conversion of a portion of the Company's sheet business to
tolling. The decline from 1993 to 1994 can be attributed to the restructuring
of the Company's Illinois sheet and plate facility and lower can stock
shipments caused by greater internal consumption by the Company's growing can
manufacturing operations.
Extrusion shipments were slightly lower in 1995 after increasing in 1994. The
differences in shipping levels primarily reflect changes in demand for
electrical rod that was impacted by customers adjusting inventory levels in
1995. Additionally, the Company's restructuring of extrusion operations in
1993, to focus on markets with the greatest potential, has resulted in reduced
shipments of certain products in each of the past two years.
The increase in shipments of other aluminum products in 1995 resulted from
strong demand for aluminum wheels in the transportation market and for
deoxidation products in the steel industry.
Net Sales
- ---------
The increases in net sales resulted from higher shipments and improved aluminum
prices in 1995 and from higher shipments in 1994. Average realized prices for
fabricated aluminum products increased more than 20% in 1995 due to strong
demand for these products.
The increases in sales of nonaluminum products in 1995 and 1994 were due
partially to higher sales of stainless steel (due in part to the 1994
acquisition of a metals distribution company). The increases also resulted
from higher sales of alumina in 1995 and increased sales of vinyl building
products and packaging products in 1994.
<TABLE>
<CAPTION>
OPERATING PROFIT (LOSS)
1995 1994 1993
---------------------------------
<S> <C> <C> <C>
Finished Products and Other Sales $232 $256 $146
Production and Processing 492 2 (188)
</TABLE>
Operating profits in Finished Products and Other Sales and Production and
Processing in 1995 and 1994 benefited from improved shipping volumes (except
for Production and Processing in 1994), higher prices for aluminum products,
increased levels of capacity utilization at aluminum fabricating operations and
performance-improvement programs, including acquisitions, divestitures,
restructurings and cost reductions. Operating profits in both years were
adversely affected by higher costs for purchased materials and increases in
selling, administrative and general expenses, which were generally the result
of the higher level of business activity. Unused capacity at primary aluminum
and alumina production facilities adversely affected operating results in all
three years. The Company has temporarily curtailed U.S. primary aluminum
production of 209,000 metric tons and had reduced production at its Texas
alumina refinery. The alumina refinery returned to full production during 1995
due to strong demand in the alumina market.
Restructuring actions for which charges were taken in 1993 and 1992 reduced
1995 and 1994 operating costs. Most significant was the restructuring of the
Company's sheet and plate facility in Illinois, where the production of various
common alloy aluminum sheet products was discontinued by mid-1994. The Company
streamlined the plant to manufacture sheet and plate products for the
automotive, aircraft and aerospace markets. Extrusion operations also were
restructured in 1993 to increase competitiveness and focus on markets with the
greatest growth potential. As a result, the Company discontinued production of
irrigation tubing at a California facility, and a Kentucky operation was
converted to manufacture products for the automotive industry.
In 1995, the Company closed an aluminum beverage can manufacturing facility in
New York. The facility's billion-can annual capacity was determined to be in
excess of the Company's customer needs due to productivity gains throughout the
Company's can system, a geographic shift in customer demand and slower overall
growth in U.S. demand for aluminum beverage cans. The Company has sold the
equipment at the facility and intends to sell the plant and property. In 1995,
the Company recorded asset revaluation costs related to certain of its foreign
investments, and costs related to the closing of the can facility, of $25
million. As a result of changes in estimated requirements for previously
restructured operations, existing reserves of approximately the same amount
were reversed during 1995. These actions did not have a material impact on
revenues, operating results or financial position.
GEOGRAPHIC AREA ANALYSIS
The Company has operations in the U.S., Canada and other foreign areas, which
include Europe, Latin America and Australia. Certain of these operations,
especially in Latin America, consist of equity interests, whose sales are not
included in the consolidated net sales of the Company. The Company
participates in an unincorporated joint venture that mines bauxite and produces
alumina in Australia.
U.S. operations produce and sell a broad range of aluminum and nonaluminum
products. U.S. sales and operating profits increased in 1995 and 1994 on the
strength of higher shipments of certain products, especially cans and ends, and
higher realized prices for aluminum products.
Sales and operating profits from Canada and Europe increased in 1995 due to
higher realized prices for aluminum products and in 1994 due to higher
shipments.
INTEREST EXPENSE
Interest expense increased in 1995 due to higher rates and declined in 1994 due
to lower amounts of debt outstanding. The Company uses interest rate swap
agreements to manage its exposure to interest rate fluctuations after
considering market conditions and levels of variable-rate and fixed-rate debt
outstanding. These arrangements caused interest expense to be slightly higher
in 1995 and slightly lower in 1994. The Company's strategy is to provide for
lower interest expense during economic downturns, with the potential for higher
interest cost during periods of economic growth.
TAXES ON INCOME
The Company pays U.S. federal and state taxes and foreign taxes based on the
laws of the various jurisdictions in which it operates. The effective tax
rates reflected in the income statement differ from the U.S. federal statutory
rate principally because of foreign taxes, the effects of percentage depletion
allowances and, in 1995, the effect of a non-recurring foreign tax benefit. A
reconciliation of the effective rates is included in Note H to the consolidated
financial statements.
At December 31, 1995, the Company had recorded $902 million of deferred tax
assets that relate primarily to its U.S. tax positions. The most significant
portions of these assets relate to tax carryforward benefits and accrued costs
for employee health care and environmental and restructuring costs. A major
portion of these assets will be realized in the future through the reversal of
temporary differences, principally depreciation. To the extent that these
assets are not covered by reversals of depreciation, the remainder is expected
to be realized through U.S. income earned in future periods. The Company has
worldwide operations in many tax jurisdictions that generate deferred tax
assets and/or liabilities. Deferred tax assets and liabilities have been
netted by jurisdiction and this results in both a deferred tax asset and a
deferred tax liability on the balance sheet.
The Company has a strong history of sustainable earnings. However, even
without considering projections of income, certain tax planning strategies,
such as changing the method of valuing inventories from LIFO to FIFO and/or
entering into sale-leaseback transactions, would generate sufficient taxable
income to realize the portion of the deferred tax asset related to U.S.
operations. Also, the majority of the U.S. tax carryforward benefits can be
carried forward indefinitely.
Based on its evaluation of these matters, the Company is confident that its
deferred tax assets will be realized and is not aware of any events or
uncertainties that could significantly affect its conclusions regarding
realization. The Company reassesses the realization of deferred tax assets
quarterly and, if necessary, adjusts its valuation allowance accordingly.
ENVIRONMENTAL
Annual capital expenditures for equipment designed for environmental control
purposes averaged approximately $36 million over the last three years. Ongoing
environmental operating costs for the same period averaged approximately $76
million per year. The Company estimates that operating expenditures for 1996
through 1998 will remain at approximately these same levels and estimates
annual capital expenditures for environmental control facilities at
approximately $53 million in 1996, $98 million in 1997 and $82 million in 1998.
The majority of these expenditures are associated with the capital spending
program referred to below at the Company's New York primary aluminum production
plant.
The Company's spending on environmental compliance will be influenced by future
environmental regulations, including those issued and to be issued under the
Clean Air Act Amendments of 1990. The Company has begun a five-year capital
spending program of an estimated $150 million to $200 million at its primary
aluminum production plant in New York. The project includes new air emissions
controls and a phased modernization of the plant's production lines. The
Company is accelerating certain expenditures believed necessary to achieve
compliance with the Clean Air Act's Maximum Achievable Control Technology
standards, although the U.S. Environmental Protection Agency (the "EPA") is
still developing such standards. Based on current information, it is estimated
that compliance with the Clean Air Act's hazardous air pollutant standards will
require in excess of $250 million of capital expenditures (including a portion
of the expenditures at the New York plant referred to above), principally at
the Company's U.S. primary aluminum plants.
The Company is involved in remedial investigations and actions at various
locations, including EPA Superfund sites where the Company and, in most cases,
others have been designated as potentially responsible parties.
The Company accrues remediation costs when it establishes the probability that
such efforts will be required and the costs can be reasonably estimated. The
Company evaluates the status of all significant existing or potential
environmental issues quarterly, develops or revises cost estimates to satisfy
known remediation requirements, and adjusts the accrual accordingly. At
December 31, 1995, the accrual was $242 million ($272 million at December 31,
1994) and reflects management's best estimate of the Company's ultimate
liability for known remediation costs.
In estimating anticipated costs, the Company considers the extent of its
involvement at each site, joint and several liability provisions under
applicable law, and the likelihood of obtaining contributions from other
potentially responsible parties. Potential insurance recoveries are uncertain
and therefore have not been considered. Based on information currently
available, remediation expenditures relating to costs currently accrued are
expected to be made over the next 15 to 20 years with the majority spent by the
year 2000. Cash flows from operations are expected to provide most of the
funds for capital, operating and remediation expenditures.
Estimating future environmental compliance and remediation costs is imprecise
due to the continuing evolution of environmental laws and regulatory
requirements, the availability and application of technology, the
identification of currently unknown remediation sites, and the allocation of
costs among potentially responsible parties. Future costs are not expected to
have a material adverse effect on the Company's competitive or financial
position or ongoing operating results. However, future costs of environmental
remediation requirements that may subsequently be determined could be material
to future quarterly or annual results of operations.
OTHER INFORMATION
In 1995, the Financial Accounting Standards Board ("FASB") issued Statement of
Financial Accounting Standards ("SFAS") No. 121, Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed Of. The Company
will adopt the statement in 1996. It is not expected to have a material impact
on the Company's financial position or results of operations.
Also in 1995, the FASB issued SFAS No. 123, Accounting for Stock-Based
Compensation. With respect to accounting for its stock options, as permitted
under SFAS No. 123, the Company intends to retain the intrinsic value method
currently used as prescribed by Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees. The Company will provide disclosures
in accordance with SFAS No. 123 when the standard is adopted in 1996.
On August 29, 1994 and March 30, 1995, the Company received civil investigative
demands from the U.S. Department of Justice relating to production of primary
aluminum and the pricing of aluminum can stock, respectively. The Company is
cooperating with both inquiries and is confident that its conduct has been in
compliance with U.S. antitrust laws.
Rates for electricity charged by the Bonneville Power Administration ("BPA"),
which serves the Company's Oregon and Washington primary aluminum production
plants, have been settled through October 1996, with a 4% increase over the
prior rate. The Company and BPA have entered into a 5-year contract that would
supersede the existing power contract for the period October 1996 - September
2001 (when the existing contract was due to expire). The new contract
establishes a fixed rate, which is 16% less than rates now in effect, that
would apply for the entire term of the new contract. The contract is, however,
subject to review and approval both in BPA's currently pending rate case and in
a subsequent review process conducted by the Federal Energy Regulatory
Commission. Further, as part of a BPA rate decision, the contract is subject
to appeal in the courts by third parties. Should the new contract be rejected
in any of these processes, the Company could continue service under the
existing contract, renegotiate with BPA, or contract for competitive power
supplied by third parties.
LIQUIDITY AND CAPITAL RESOURCES
WORKING CAPITAL
Working capital totaled $647 million at the end of 1995 compared to $898
million at the end of 1994. The ratio of current assets to current liabilities
was 1.5/1 at the end of 1995 compared to 1.6/1 at year-end 1994. The decrease
in working capital was due to the use of cash and the proceeds from the
maturities of investments in debt securities to fund a part of the requirements
of investing activities.
OPERATING ACTIVITIES
Cash provided from operations in 1995, 1994 and 1993 amounted to $489 million,
$493 million and $259 million, respectively. The Company used these funds for
investing activities during this period.
INVESTING ACTIVITIES
Substantial investments have provided the Company with low-cost operations in
most of its raw materials, industrial and finished products businesses. The
Company is now focusing on strategic areas for expansion and on further quality
and efficiency enhancements. The table below shows actual and projected
capital expenditures in the following categories: operational (replacement
equipment, environmental control projects, etc.), strategic (performance
improvement and strategic investments), and acquisitions and investments.
<TABLE>
<CAPTION>
Projected
1996 1995 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
Operational $230 $219 $151 $146
Strategic 195 189 107 138
Acquisitions and investments 65 437 146 117
--------------------------------------------
Total capital investments $490 $845 $404 $401
============================================
</TABLE>
In the Finished Products and Other Sales operating area, strategic projects and
acquisitions and investments that have been completed in the past three years
or that are underway include: the acquisition of can manufacturing facilities
that increased the Company's U.S. can-making capacity by 70%; the expansion and
modernization of other can manufacturing facilities; the participation as a
joint-venture partner in the construction of can manufacturing facilities in
Argentina, Brazil, Chile and Saudi Arabia; expansions at foil and plastic film
facilities; and the acquisitions of a metals distribution business, a printing
cylinder engraving company, a foil laminating plant, and a flexible packaging
manufacturing operation.
In the Production and Processing operating area, strategic projects and
acquisitions and investments that have been completed in the past three years
or that are underway include: the acquisition of an additional interest (6%)
in an alumina refinery in Australia; the acquisition of an additional interest
(24.95%) in the Becancour, Quebec primary aluminum production facility; the
modernization of a primary aluminum production plant in New York; the
construction of a plant in Arkansas that processes spent potliner into an
environmentally acceptable material with potential for recycling; a quality
improvement program at a can sheet operation in Alabama; the construction and
expansion of a facility in Indiana to produce bumpers and other automotive
components; and the modification and equipping of a purchased facility in
Wisconsin to produce aluminum wheels.
In addition to these major projects, capacity expansions, equipment upgrades
and/or improvement programs have been completed or are currently underway at a
number of other facilities.
Capital investments for 1996 will include amounts for those projects now
underway, the participation in a joint venture in China that produces foil and
extrusions, and continuing operating requirements. Projected 1996 capital
investments do not include amounts for acquisitions as no significant
acquisitions are pending. The Company will, however, consider any
opportunities that arise.
A part of the Company's strategy is to sell non-core assets and redeploy the
proceeds into strategic businesses. In early 1995, the Company sold its
remaining gold mining assets in Australia. In 1994, the Company sold a can
manufacturing facility in Austria, a subsidiary that held a 40% investment in
an Australian gold mine, and timberland in the Pacific Northwest.
FINANCING ACTIVITIES
The Company believes its available financial resources, together with
internally generated funds, are sufficient to meet its business needs at the
present time and for the foreseeable future. The Company continues to exceed
the financial ratio requirements contained in its financing arrangements and
expects to do so for the foreseeable future. At December 31, 1995, $150
million of the Company's $1.65 billion shelf registration remained available
for the issuance of debt securities. The Company also has a $500 million
revolving credit facility. Following is a summary of significant financing
activities over the past three years:
1993:
- -- Issued $78 million of medium-term notes at an average rate of 7.5% that
mature in 2004 to 2013
- -- Issued $285 million of 6-5/8% amortizing notes due between 1998 and 2002
- -- Borrowed $150 million under a bank credit agreement that requires a single
repayment in 1998 and bears interest at a variable rate (6.4% at
December 31, 1995)
Proceeds from these activities were used for voluntary prepayment of $143
million of a term loan agreement, refinancing approximately $200 million of
short-term obligations, scheduled payments on long-term obligations of
approximately $100 million and for general corporate purposes.
1994:
- -- Issued 11 million shares of 7% PRIDES(SM), Convertible Preferred Stock for
$47.25 (stated value) per share, which generated $505 million of net
proceeds
- -- Voluntarily prepaid the remaining balance ($72 million) of a term loan
agreement and repaid the balance ($50 million) of commercial paper
outstanding
The Company used proceeds from the PRIDES issue for capital investments in 1994
and 1995 and to repay obligations incurred in the fourth quarter of 1993 to
acquire Miller Brewing Company's can manufacturing operations.
FINANCING ACTIVITIES - continued
1995:
- -- Amended the $500 million revolving credit facility arranged in 1994 to
extend the term from 1999 to 2000 and lower the commitment fee on the
unused portion of the facility from .20% to .125%. No amounts were
outstanding under the facility at December 31, 1995
- -- Borrowed $22 million through the issuance of tax-exempt bonds that require
a single repayment in 2025 and bear interest at a variable rate (4% at
December 31, 1995)
- -- Issued $72 million of medium-term notes, which bear interest at an
average rate of 6% and mature in 1996 and 1997
- -- Increased the quarterly dividend on the Company's common stock by 10 cents
to 35 cents per share, in view of the Company's improved performance and
outlook for the future
Proceeds from the tax-exempt bonds were used to finance a portion of the costs
of acquiring, constructing and installing environmental control facilities at
the Company's primary aluminum production plant in New York. Proceeds from the
medium-term notes were supplemented with cash on hand and cash generated from
operations to acquire an additional interest (24.95%) in the Becancour, Quebec
primary aluminum production facility for approximately $390 million, plus
associated working capital.
In 1993, the Company filed a registration statement relating to the
contribution, through December 31, 1995, of up to 3 million shares of common
stock to its pension plans. The shares were contributed as follows (in
millions):
<TABLE>
<CAPTION>
Year Shares Value
---- ------ -----
<S> <C> <C>
1993 .6 $28
1994 1.5 77
1995 .9 45
----------------------------
3.0 $150
============================
</TABLE>
OUTLOOK AND STRATEGY
At the beginning of 1996, the liquidation of excess customer inventories
continues and slower economic growth rates worldwide are expected to have an
impact on market conditions, possibly through the first half. As the year
progresses, market conditions are expected to improve based on the Company's
projections of world economic growth of just over 3%, and world aluminum
consumption growth of 3.5%-4%. After the inventory liquidation process ends,
and barring a recession in any major world economy, the Company expects the
improvement in aluminum industry supply/demand fundamentals to continue for the
next several years. The Company's outlook for growth in aluminum consumption
for the remainder of this decade is an average of 4% per year, compared to 1.5%
in the 1980s, and 2% in the 1970s. The Company expects greater use of aluminum
around the world in automobiles and other light vehicles; rapid growth of the
aluminum beverage can market in Latin America, Asia, the Middle East, and other
developing economies; and increased use of aluminum in the building and
construction markets, particularly in developing countries.
The Company's strategy is to continue improving its global competitive position
as a vertically integrated producer of value-added aluminum products, with
emphasis on growth opportunities in its fabricating operations serving the can,
packaging, consumer products, transportation, and building and construction
markets. To improve its competitiveness, the Company has undertaken intensive
cost reduction and performance improvement programs that include work force
reductions, permanent closures of higher-cost facilities, disposal of
uneconomic and non-core assets, and operational and organizational
restructuring. The Company's restructuring efforts and performance
improvements of the past few years, along with improving economic conditions
that are expected to create a strong demand for aluminum, should contribute
significantly to the Company's operating results.
Primary aluminum is an internationally traded commodity. The price of primary
aluminum is subject to worldwide market forces of supply and demand. Prices
can be volatile and fluctuations influence the Company's financial results.
The world market is still recovering from a serious supply-demand imbalance
that began in the early 1990s and there may be periods of marked short-term
price volatility. The Company's strategy of being a vertically integrated
producer of value-added aluminum products reduces its exposure to these
fluctuations, but does not eliminate it. The Company manages its exposure to
these fluctuations, after giving consideration to market conditions, sale and
purchase transactions, overall business strategies and other factors that
affect the Company's risk profile, with contractual arrangements including
fixed-price sales contracts, fixed-price supply contracts, and forward, futures
and option contracts. Through these activities, the Company balances its risk
profile consistent with management's operational strategies.
In addition to the aluminum price risk, the Company is exposed to general
financial, political, economic and business risks in connection with its
worldwide operations. The Company continues to evaluate and manage its
operations in a manner to mitigate the effects from exposure to such risks.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS (In millions, except
per share amounts)
===============================================================================
==================
Years ended December 31 1995 1994
1993
- -------------------------------------------------------------------------------
- ------------------
<S> <C> <C>
<C>
REVENUES
Net sales $7,213 $5,879
$5,269
Equity, interest and other income 39 46
25
Gains on sales of assets - 88
-
- -------------------------------------------------------------------------------
- ------------------
7,252 6,013
5,294
- -------------------------------------------------------------------------------
- ------------------
COSTS AND EXPENSES
Cost of products sold 5,772 4,996
4,657
Selling, administrative and general expenses 449 376
358
Provision for depreciation and amortization 311 295
287
Interest - principally on long-term obligations 172 156
159
Operational restructuring and asset revaluation costs - -
348
- -------------------------------------------------------------------------------
- ------------------
6,704 5,823
5,809
- -------------------------------------------------------------------------------
- ------------------
EARNINGS
Income (loss) before income taxes 548 190
( 515)
Taxes on income (credit) 159 68
(193)
- -------------------------------------------------------------------------------
- ------------------
NET INCOME (LOSS) 389 122
( 322)
Preferred stock dividends 36 34
-
- -------------------------------------------------------------------------------
- ------------------
NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS 353 88
( 322)
RETAINED EARNINGS
Balance at beginning of year 980 954
1,348
Cash dividends on common stock 77 62
72
- -------------------------------------------------------------------------------
- ------------------
Retained earnings at end of year $1,256 $ 980
$ 954
===============================================================================
==================
EARNINGS PER SHARE
Average shares outstanding 73 62
60
Net income (loss) $5.35 $1.42
$(5.38)
===============================================================================
==================
CASH DIVIDENDS PER COMMON SHARE $1.20 $1.00
$1.20
===============================================================================
==================
See notes beginning on page 36.
/TABLE
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEET (In
millions)
===============================================================================
==================
December 31 1995
1994
- -------------------------------------------------------------------------------
- ------------------
<S> <C>
<C>
ASSETS
Current assets
Cash $ 17
$ 26
Short-term investments (cash equivalents 1995 - $22, 1994 - $282) 22
408
Receivables
Customers, less allowances of $20 (1994 - $19) 889
851
Other 154
111
- -------------------------------------------------------------------------------
- ------------------
Total receivables 1,043
962
Inventories 891
873
Prepaid expenses 41
53
- -------------------------------------------------------------------------------
- ------------------
Total current assets 2,014
2,322
Unincorporated joint ventures and associated companies 1,286
856
Property, plant and equipment - net 3,223
3,108
Deferred taxes 376
426
Other assets 841
749
- -------------------------------------------------------------------------------
- ------------------
Total assets $7,740
$7,461
===============================================================================
==================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Trade payables $ 527
$ 658
Accrued compensation and related amounts 252
263
Payables to unincorporated joint ventures and
associated companies 102
84
Short-term borrowings 111
120
Long-term debt 101
18
Other liabilities 274
281
- -------------------------------------------------------------------------------
- ------------------
Total current liabilities 1,367
1,424
Long-term debt 1,853
1,848
Postretirement benefits 1,213
1,145
Environmental 178
236
Deferred taxes 236
183
Other liabilities 276
353
Stockholders' equity
Preferred stock 505
505
Common stock 941
870
Retained earnings 1,256
980
Cumulative currency translation adjustments (22)
(43)
Pension liability adjustment (63)
(40)
- -------------------------------------------------------------------------------
- ------------------
Total stockholders' equity 2,617
2,272
Contingent liabilities and commitments (Notes I and J)
- -------------------------------------------------------------------------------
- ------------------
Total liabilities and stockholders' equity $7,740
$7,461
===============================================================================
==================
See notes beginning on page 36.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED STATEMENT OF CASH FLOWS (In
millions)
===============================================================================
==================
Years ended December 31 1995
1994 1993
- -------------------------------------------------------------------------------
- ------------------
<S> <C>
<C> <C>
OPERATING ACTIVITIES
Net income (loss) $389
$122 ($322)
Adjustments to reconcile to net cash provided by
operating activities:
Depreciation and amortization 311
295 287
Gains on sales of assets -
(88) -
Deferred taxes 127
7 (161)
Operational restructuring and asset revaluation costs -
- 344
Other (76)
42 106
Changes in operating assets and liabilities net of
effects from acquisitions and dispositions:
Accounts payable, accrued and other liabilities (173)
272 50
Receivables (59)
(173) (55)
Inventories 17
(106) 70
Other (47)
122 (60)
- -------------------------------------------------------------------------------
- ------------------
Net cash provided by operating activities 489
493 259
INVESTING ACTIVITIES
Capital investments
Operational (219)
(151) (146)
Strategic (189)
(107) (138)
Acquisitions and investments (437)
(146) (117)
Purchases of debt securities -
(139) -
Maturities of investments in debt securities 125
14 -
Proceeds from sales of assets 28
162 36
Other (48)
(71) 60
- -------------------------------------------------------------------------------
- ------------------
Net cash used in investing activities ( 740)
( 438) ( 305)
FINANCING ACTIVITIES
Proceeds from long-term debt 106
- 545
Proceeds from preferred stock issue -
505 -
Reduction of long-term debt and other financing liabilities (22)
(165) (469)
Decrease in short-term borrowings (18)
(37) (20)
Cash dividends paid (106)
(71) (72)
Other 22
2 1
- -------------------------------------------------------------------------------
- ------------------
Net cash provided by (used in) financing activities ( 18)
234 ( 15)
CASH AND CASH EQUIVALENTS
Net increase (decrease) ( 269)
289 ( 61)
At beginning of year 308
19 80
- -------------------------------------------------------------------------------
- ------------------
At end of year $ 39
$ 308 $ 19
===============================================================================
==================
See notes beginning on page 36.
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
- ------------------------------------------
(In the tables, dollars are in millions, except share amounts. Certain amounts
have been reclassified to conform to the 1995 presentation.)
- -------------------------------------------------------------------------------
NOTE A - ACCOUNTING POLICIES
- ----------------------------
General
- -------
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Principles of Consolidation
- ---------------------------
The accounts of the Company and its majority-owned subsidiaries are included in
the consolidated financial statements after eliminating intercompany
transactions, profits and losses. The investments in unincorporated joint
ventures, which are production facilities without marketing or sales
activities, are accounted for on an investment cost basis adjusted for the
Company's share of the non-cash production charges of the operation.
Investments in associated (20% to 50% owned) companies are carried at cost,
adjusted for the Company's equity in their undistributed net income.
Revenue Recognition
- -------------------
Revenues are recognized when products are shipped and the title and risk of
ownership pass to the customer.
Inventories
- -----------
Inventories are stated at the lower of cost or market. Costs of inventories
totaling $312 million in 1995 and $309 million in 1994 were determined by the
last-in, first-out (LIFO) method. Remaining inventories of $579 million in
1995 and $564 million in 1994 were determined by the average or first-in,
first-out (FIFO) methods. If the FIFO method were applied to LIFO inventories,
the amount for inventories would increase by $508 million at December 31, 1995,
and $454 million at December 31, 1994. Since certain inventories may be sold
at various stages of processing, no practical distinction can be made between
finished products, in-process products and other materials. Inventories are
therefore presented as a single classification.
Depreciation and Amortization
- -----------------------------
Depreciation of plant and equipment is recorded on the straight-line method
over their estimated useful lives. Improvements to leased properties are
amortized generally on the basis of the shorter of the terms of the respective
leases or the estimated useful lives of the related facilities.
Environmental Expenditures
- --------------------------
The Company's policy is to accrue remediation costs when it is probable that
such efforts will be required and the related costs can be reasonably
estimated.
Postemployment Benefits
- -----------------------
The expected cost of postemployment benefits is accrued when it becomes
probable that such benefits will be paid.
Hedging
- -------
The Company designates forward, futures and option contracts and swap
agreements to manage market risks resulting from fluctuations in the aluminum,
foreign currency and debt markets. These instruments, which are held for
purposes other than trading, are effective in minimizing these risks by
creating equal and offsetting market exposure. None of these instruments
contain multiplier or leverage features. The
NOTE A - ACCOUNTING POLICIES - continued
- ----------------------------------------
Company is exposed to credit risk if the other parties to these instruments do
not perform. The Company closely monitors the creditworthiness of the
counterparties and they are expected to fulfill their obligations. Instruments
utilized by the Company to manage risks in the foreign currency and debt
markets are not material. For contracts that are designated and effective as
hedges, unrealized gains and losses are deferred and recorded as a component of
the underlying transaction. Realized gains or losses resulting from
termination of contracts designated as hedges are deferred as a component of
other assets or liabilities until the occurrence of the underlying transaction.
Realized and unrealized gains and losses on contracts that relate to
transactions that are no longer probable of occurring are recognized in results
currently.
Earnings Per Share
- ------------------
For 1995, earnings per share equals net income divided by the weighted-average
number of common shares and common share equivalents outstanding during the
year. The number of common share equivalents outstanding was based on the
assumed conversion of the Company's preferred stock ("PRIDES"). For the
purpose of this computation, the conversion rate (0.88 per share) of common
stock for each share of PRIDES was based on the average market value of the
Company's common stock during the year ($53.56 per share). For 1994, earnings
per share equals net income, minus PRIDES dividends, divided by the
weighted-average number of common shares outstanding during the year. Common
share equivalents relating to the PRIDES were not included in 1994 since their
effect would have been anti-dilutive. For 1993, earnings per share equals net
income divided by the weighted-average number of common shares outstanding
during the year.
Statement of Cash Flows
- -----------------------
For purposes of the Statement of Cash Flows, all highly liquid, short-term
investments purchased with an original maturity of three months or less are
considered to be cash equivalents.
New Accounting Rules
- --------------------
In 1995, the Financial Accounting Standards Board ("FASB") issued Statement of
Financial Accounting Standards ("SFAS") No. 121, Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed Of. The Company
will adopt the statement in 1996. It is not expected to have a material impact
on the Company's financial position or results of operations.
Also in 1995, the FASB issued SFAS No. 123, Accounting for Stock-Based
Compensation. With respect to accounting for its stock options, as permitted
under SFAS No. 123, the Company intends to retain the intrinsic value method
currently used as prescribed by Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees. The Company will provide disclosures
in accordance with SFAS No. 123 when the standard is adopted in 1996.
NOTE B - GAINS ON SALES OF ASSETS
- ---------------------------------
In 1994, the Company completed the sale of Reynolds Australia Metals, Ltd.,
which held a 40% interest in the Boddington Gold Mine, to a subsidiary of
Poseidon Gold Limited, recognizing a pre-tax gain of $63 million. Also in
1994, the Company recorded a pre-tax gain of $25 million on the sale of
timberland in the Pacific Northwest.
NOTE C - UNINCORPORATED JOINT VENTURES AND ASSOCIATED COMPANIES
- ---------------------------------------------------------------
The Company has interests in unincorporated joint ventures that produce alumina
and primary aluminum. The investments in these entities consist of the
following:
<TABLE>
<CAPTION>
December 31
---------------------
1995 1994
---------------------
<S> <C> <C>
Current assets $67 $71
Current liabilities (54) (51)
Property, plant and equipment and other assets 1,032 624
---------------------
Net investment $1,045 $644
=====================
</TABLE>
The Company also has interests in foreign-based associated companies that
produce bauxite, alumina, primary aluminum, hydroelectric power and aluminum
cans. The investments in these companies were $241 million and $212 million at
December 31, 1995 and 1994, respectively, which includes advances of $46
million and $49 million.
The Company recorded equity income (pre-tax) of $17 million, $24 million and $9
million during 1995, 1994 and 1993, respectively. Summarized financial
information related to these entities is as follows:
<TABLE>
<CAPTION>
Years ended December 31
-----------------------------
1995 1994 1993
-----------------------------
<S> <C> <C> <C>
Net sales $709 $476 $444
Cost of products sold 602 410 376
Net income 37 33 22
</TABLE>
<TABLE>
<CAPTION>
December 31
----------------------
1995 1994
----------------------
<S> <C> <C>
Current assets $533 $367
Non-current assets 575 422
Current liabilities 384 214
Non-current liabilities 265 197
Stockholders' equity 459 378
</TABLE>
NOTE D - PROPERTY, PLANT AND EQUIPMENT - AT COST
- ------------------------------------------------
<TABLE>
<CAPTION>
December 31
-----------------------
1995 1994
-----------------------
<S> <C> <C>
Land, land improvements and mineral properties $302 $306
Buildings and leasehold improvements 1,057 1,030
Machinery and equipment 4,972 4,797
Construction in progress 269 175
-----------------------
$6,600 $6,308
Less allowances for depreciation and amortization 3,377 3,200
-----------------------
Net property, plant and equipment $3,223 $3,108
=======================
</TABLE>
NOTE E - FINANCING ARRANGEMENTS
- -------------------------------
<TABLE>
<CAPTION>
December 31
------------------------
1995 1994
------------------------
<S> <C> <C>
Public debt securities:
Medium-term notes $1,046 $976
6-5/8% amortizing notes 284 284
9% debentures due 2003 100 100
9-3/8% debentures due 1999 100 100
Industrial and environmental control revenue bonds 242 220
Other issues:
Bank credit agreement 150 150
Mortgages and other notes payable 32 36
------------------------
1,954 1,866
Amounts due within one year 101 18
------------------------
Long-term debt $1,853 $1,848
========================
</TABLE>
Maturities of long-term debt at December 31, 1995 were $101 million in 1996,
$72 million in 1997, $292 million in 1998, $197 million in 1999, $155 million
in 2000 and $1,137 million from 2001 to 2025. Interest paid amounted to $172
million, $152 million and $159 million during 1995, 1994 and 1993,
respectively, net of interest capitalized of $7 million, $5 million and $8
million.
The Company has on file a shelf registration to issue up to $1.65 billion of
debt securities. The medium-term notes, 9% debentures and 9-3/8% debentures
were issued under the shelf registration. The medium-term notes bear interest
at an average fixed rate of 8.8% and have maturities ranging from 1996 to 2013.
At December 31, 1995, $150 million of debt securities remained unissued under
the shelf registration.
The 6-5/8% amortizing notes were issued at a discount (99.48%) and have an
effective interest rate of 6.7%. The notes require annual principal repayments
of $57 million each year between 1998 and 2002.
Industrial and environmental control revenue bonds consist principally of
variable-rate debt with interest rates averaging approximately 4.3% at December
31, 1995. These bonds require principal repayment periodically or in a lump
sum through 2025. $237 million of these bonds are supported by bank letters of
credit.
The bank credit agreement bears interest at a variable rate (6.4% at December
31, 1995) and requires a single repayment in 1998.
The mortgages and other notes payable category consists of fixed-rate debt at
an average rate of 6.7% and requires principal repayment through 2009.
The Company has a $500 million revolving credit facility that expires in 2000.
No amounts were outstanding under the facility at December 31, 1995. The
Company pays a commitment fee of .125% per year on the unused portion of the
facility.
NOTE E - FINANCING ARRANGEMENTS - continued
- -------------------------------------------
The Company designates interest rate swap agreements to manage a portion of its
exposure to interest rate fluctuations after considering outstanding levels of
variable-rate and fixed-rate debt. The differential to be paid or received
under these agreements as interest rates change is accrued and recognized as an
adjustment of interest expense. The fair values of the swap agreements (which
at the end of 1995 and 1994 were not material) are not recognized in the
financial statements. At December 31, 1995, the Company had $742 million of
interest rate swap agreements (1994 - $742 million), which effectively convert
a portion of its debt (principally medium-term notes) from fixed-rate to
variable-rate. Under these agreements, payments are received based on a fixed
rate (4.9%) and made based on a variable rate (5.6% at December 31, 1995).
These agreements mature in 1996 ($517 million, including $317 million in
January), 1997 ($125 million) and 1998 ($100 million). The Company also had
$175 million of interest rate swap agreements (1994 - $175 million), which
effectively convert a portion of its debt (principally the bank credit
agreement and industrial and environmental control revenue bonds) from
variable-rate to fixed-rate. Under these agreements, payments are received
based on a variable rate (5.9% at December 31, 1995) and made based on a fixed
rate (6.0%). These agreements mature in 1998. The variable rates in the
Company's interest rate swap agreements are based on the London Interbank Offer
Rate.
Certain of the Company's financing arrangements contain restrictions that
primarily consist of requirements to maintain specified financial ratios.
These restrictions do not inhibit operations or the use of fixed assets. At
December 31, 1995, the Company exceeded all such requirements.
The fair value of the Company's long-term debt (determined based on discounted
cash flows) was approximately $2.1 billion at the end of 1995 and approximately
equal to book value at the end of 1994.
Short-term borrowings included in current liabilities represent notes payable
to banks. The weighted-average interest rate on these debt instruments was
7.0% and 7.6% at December 31, 1995 and 1994, respectively.
NOTE F - STOCKHOLDERS' EQUITY
- -----------------------------
Preferred stock
- ---------------
The Company has 21,000,000 shares of preferred stock authorized of which
2,000,000 shares have been designated Series A Junior Participating Preferred
and 11,000,000 have been designated 7% PRIDES(SM), Convertible Preferred Stock.
The Company has 11,000,000 shares of 7% PRIDES outstanding ($47.25 stated
value). The PRIDES mature on December 31, 1997, at which time they
mandatorily convert into shares of the Company's common stock on a one-for-one
basis. Dividends are cumulative from the date of issuance and are payable
quarterly in arrears. Holders may convert each share of PRIDES into .82 of a
share of common stock (to be adjusted under certain circumstances) at any time
prior to December 31, 1997. The Company has the option of redeeming the PRIDES
at any time on or after December 31, 1996, for common stock having a fair
market value equal to the issue price plus accrued dividends plus a small
premium. The redemption price will in no event be less than .82 of a share of
common stock per share of PRIDES. The holders of shares of PRIDES have the
right to vote with the holders of common stock in the election of Directors and
on each matter coming before any meeting of the holders of common stock on the
basis of 4/5 of a vote for each share of PRIDES. Dividends declared were
$3.31and $3.10 per share in 1995 and 1994, respectively.
NOTE F - STOCKHOLDERS' EQUITY - continued
- -----------------------------------------
<TABLE>
<CAPTION>
Common stock
- ------------
Shares Amount
-----------------------------
<S> <C> <C>
Authorized, without par value 200,000,000
Outstanding:
At beginning of 1993 59,760,219 $750
Shares issued under employee benefit plans:
1993 728,644 34
1994 1,679,792 86
1995 1,429,822 71
-----------------------------
At end of 1995 63,598,477 $941
=============================
</TABLE>
The Company filed a registration statement in late 1993 relating to the
contribution, through December 31, 1995, of up to 3 million shares of common
stock to one or more of its pension plans. Contributions were made totaling
0.6 million shares (valued at $28 million) in 1993, 1.5 million shares (valued
at $77 million) in 1994 and 0.9 million shares (valued at $45 million) in 1995.
<TABLE>
<CAPTION>
Cash dividends declared
- -----------------------
1995 1994 1993
----------------------------------
<S> <C> <C> <C>
7% PRIDES $36 $34 -
Common stock 77 62 $72
----------------------------------
$113 $96 $72
==================================
</TABLE>
Stock option plan
- -----------------
The Company has a non-qualified stock option plan under which stock options may
be granted to key employees at a price equal to the fair market value at the
date of grant. Transactions involving the plan were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
---------------------------------------------
<S> <C> <C> <C>
Outstanding January 1 4,404,054 3,755,806 3,138,856
Granted 755,400 727,950 673,100
Cancelled (26,225) (24,650) (33,250)
Exercised (453,509) (55,052) (22,900)
---------------------------------------------
Outstanding at December 31 4,679,720 4,404,054 3,755,806
=============================================
Exercisable at December 31 3,931,370 3,681,204 3,084,356
=============================================
Options available for grant 520,025 1,259,500 1,978,150
=============================================
Weighted-average prices:
Granted $51.50 $45.38 $45.50
Exercised 42.75 31.00 35.25
Outstanding at December 31 51.50 50.75 51.50
Exercisable at December 31 51.50 51.75 52.75
</TABLE>
NOTE F - STOCKHOLDERS' EQUITY - continued
- -----------------------------------------
Shareholder rights plan
- -----------------------
Each share of the Company's common stock has one right attached. The rights
trade with the common stock and are exercisable only if a person or group buys
20% or more of the Company's common stock, or announces a tender offer for 30%
or more of the outstanding common stock. When exercisable, each right will
entitle a holder to buy one-hundredth of one share of the Company's Series A
Junior Participating Preferred Stock at an exercise price of $125.
If at any time after the rights become exercisable, the Company is acquired in
a merger or other business combination or if 50% of its assets or earning power
is sold or transferred, each right would enable its holder to buy common stock
of the acquiring company at a 50% discount. In addition, if a person or group
acquires 30% or more of the common stock or if certain other events occur, each
right would enable its holder to buy common stock of the Company at a 50%
discount. The rights, which do not have voting privileges, expire in 1997, but
may be redeemed by action of the Board of Directors before then, under certain
circumstances, for $0.05 per right. Until the rights become exercisable, they
have no dilutive effect on earnings per share.
Although these rights should not interfere with a business combination approved
by the Board of Directors, they will cause substantial dilution to a person or
group that attempts to acquire the Company without conditioning the offer on
redemption of the rights or acquiring a substantial number of the rights.
<TABLE>
<CAPTION>
Cumulative currency translation adjustments
- -------------------------------------------
1995 1994 1993
-------------------------------
<S> <C> <C> <C>
At beginning of year $(43) $(50) $(2)
Currency translation adjustments 23 7 (49)
Income taxes (2) - 1
-------------------------------
At end of year $(22) $(43) $(50)
===============================
</TABLE>
NOTE G - POSTRETIREMENT BENEFITS
- --------------------------------
Pensions
- --------
The Company has several noncontributory defined benefit pension plans covering
substantially all employees. Plans covering salaried employees provide pension
benefits that are based on a formula which considers length of service and
earnings during years of service. Plans covering hourly employees generally
provide a specific amount of benefits for each year of service.
Net pension costs were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
-------------------------------
<S> <C> <C> <C>
Service cost $27 $32 $27
Interest cost 133 127 117
Actual return on plan assets (308) 3 (163)
Net amortization and deferrals 192 (92) 84
Other 12 12 10
-------------------------------
Total $56 $82 $75
===============================
</TABLE>
NOTE G - POSTRETIREMENT BENEFITS - continued
- --------------------------------------------
Assumptions used in accounting for the principal pension plans were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
----------------------------
<S> <C> <C> <C>
Discount rate 7.25% 8.75% 7.5%
Approximate weighted-average rate of increase in
compensation levels (salaried plan only) 4.5% 4.5% 4.5%
Expected long-term rate of return on assets 9.25% 9.25% 9.25%
</TABLE>
The following table sets forth information on the principal pension plans:
<TABLE>
<CAPTION>
December 31
1995 1994
---------------------
<S> <C> <C>
Actuarial present value of pension benefit obligation:
Vested $1,546 $1,286
Nonvested 177 160
---------------------
Accumulated $1,723 $1,446
=====================
Projected $1,858 $1,539
Plan assets at fair value 1,692 1,346
---------------------
Plan assets less than pension benefit obligation 166 193
Items not yet recognized:
Unrecognized net loss (271) (181)
Unamortized plan change benefits (98) (96)
Recognition of minimum liability 151 104
---------------------
Net pension (asset) liability $(52) $20
=====================
</TABLE>
The increase in the accumulated benefit obligation in 1995 was due to the
reduction in the discount rate.
Reflected in the Company's balance sheet is the additional minimum liability
relative to its underfunded plans in the amount of $151 million in 1995 ($104
million in 1994). A corresponding amount was recognized as an intangible
asset, to the extent it does not exceed unamortized plan change benefits, while
the excess, net of tax, has been charged to stockholders' equity.
The Company plans to make contributions totaling approximately $200 million to
its pension plans between 1996 and 1998. The timing and ultimate level of the
contributions will depend upon conditions in the securities markets and the
overall business environment. Cash for the fundings is expected to be
generated from operations. If there are no significant plan changes and/or
deviations in actuarial assumptions, this funding level will provide for a
fully funded accumulated benefit obligation by 1998. The Company contributed
$127 million (including 0.9 million shares of common stock valued at $45
million) in 1995 and $122 million (including 1.5 million shares of common stock
valued at $77 million) in 1994.
At December 31, 1995, approximately 62% of the plans' assets were invested in
corporate equity securities (including 1.8 million shares of common stock of
the Company with a market value of $102 million), 18% in corporate bonds, 16%
in government debt securities and cash equivalents and 4% in real estate.
Dividends paid on common shares of the Company held by the plans during 1995
totaled $3 million.
NOTE G - POSTRETIREMENT BENEFITS - continued
- --------------------------------------------
Other postretirement benefits
- -----------------------------
The Company provides health care and life insurance benefits to most domestic
retired employees. Substantially all of the Company's domestic employees may
become eligible for these benefits if they reach retirement age while working
for the Company. The Company's policy is to fund the cost of these benefits
when actual expenses are incurred.
The Company's accumulated postretirement benefit obligation was comprised of
the following:
<TABLE>
<CAPTION>
December 31
--------------------
1995 1994
--------------------
<S> <C> <C>
Retirees $694 $717
Active employees fully eligible 71 55
Active employees not fully eligible 165 140
Unamortized plan change benefits 178 189
Unrecognized net loss (46) (21)
--------------------
Total $1,062 $1,080
====================
</TABLE>
Net periodic postretirement benefit cost was:
<TABLE>
<CAPTION>
1995 1994 1993
------------------------------------
<S> <C> <C> <C>
Service cost $6 $8 $9
Interest cost 74 74 74
Net amortization (19) (16) (14)
------------------------------------
Total $61 $66 $69
====================================
</TABLE>
The annual assumed rate of increase in the per capita cost of covered benefits
(i.e., health care cost trend rate) is 7% for 1996 (10% in 1995 and 11% in
1994) and is assumed to decrease gradually to 5% for 2002 and remain at that
level thereafter. The health care cost trend rate assumption has a significant
effect on the amounts reported. For example, each one percentage point change
in the assumed health care cost trend rate would change the accumulated
postretirement benefit obligation as of December 31, 1995, by approximately $61
million and the aggregate of the service and interest cost components of net
periodic postretirement benefit cost for 1995 by approximately $4 million.
The discount rate used in determining the accumulated postretirement benefit
obligation was 7.25% at December 31, 1995, and 8.75% at December 31, 1994. The
effect of the reduction in the discount rate in 1995 was partially offset by a
reduction in the health care cost trend rate.
NOTE H - TAXES ON INCOME
- ------------------------
At December 31, 1995, the Company had various U.S. and German income tax
carryforward benefits of $37 million that expire primarily between 1998 and
2010 and $132 million that can be carried forward indefinitely. The Company
has deferred tax assets primarily relating to certain state operating loss
carryforwards, and foreign entities of approximately $45 million against which
a full valuation reserve has been recorded. The Company is continuing to
evaluate alternatives that may result in the ultimate realization of a portion
of these assets.
NOTE H - TAXES ON INCOME - continued
- ------------------------------------
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. At December 31, 1995,
the Company had $902 million (1994 - $976 million) of deferred tax assets and
$759 million (1994 - $717 million) of deferred tax liabilities that have been
netted with respect to tax jurisdictions for presentation purposes. The
significant components of these amounts as shown on the balance sheet were as
follows:
<PAGE>
<TABLE>
<CAPTION>
1995
1994
- ------------------------------------------
Asset
Liability Asset Liability
- ------------------------------------------
<S> <C> <C>
<C> <C>
Retiree health benefits $415 -
$414 -
Tax carryforward benefits 213
$(1) 207 $(61)
Environmental and restructuring costs 121
(2) 142 (3)
Other 44 39
69 17
Tax over book depreciation (369) 200
(341) 230
Valuation reserve relating to tax carryforward benefits (45) -
(49) -
- ------------------------------------------
Total deferred tax assets and liabilities 379 236
442 183
Amount included as current in balance sheet 3 -
16 -
- ------------------------------------------
Noncurrent deferred tax assets and liabilities $376 $236
$426 $183
==========================================
</TABLE>
The significant components of the provision for income taxes were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
- --------------------------------
<S> <C>
<C> <C>
Current:
Federal
$10 $30 $(55)
Foreign
10 15 14
State
3 1 4
- --------------------------------
Total current
23 46 (37)
- --------------------------------
Deferred:
Federal
66 (13) (99)
Foreign
62 32 (33)
State
- - (8) (29)
- --------------------------------
Total deferred
128 11 (161)
- --------------------------------
Equity income
8 11 5
- --------------------------------
Total
$159 $68 $(193)
================================
</TABLE>
<PAGE>
The deferred tax provision included state and foreign operating loss
carryforward benefits of $9 million.
The Company has not provided taxes on the undistributed earnings ($992 million)
of foreign subsidiaries. It is the intent of the Company to use such earnings
to finance foreign expansion, reduce foreign debt, or support foreign
operating requirements.
NOTE H - TAXES ON INCOME - continued
- -------------------------------------
The Company's effective income tax rate varied from the U.S. statutory rate as
follows:
<TABLE>
<CAPTION>
1995 1994 1993
-----------------------------
<S> <C> <C> <C>
U.S. rate 35% 35% (35)%
Income taxed at other than the U.S. rate (5) 2 3
Percentage depletion (1) (3) (1)
State income taxes and other - 2 (4)
-----------------------------
Effective rate 29% 36% (37)%
=============================
</TABLE>
In 1995, income taxed at other than the U.S. rate includes a non-recurring
foreign tax benefit of 3%.
Net income taxes paid (refunded) were $56 million, ($17 million) and $6 million
in 1995, 1994 and 1993, respectively.
NOTE I - CONTINGENT LIABILITIES AND COMMITMENTS
- -----------------------------------------------
Various suits and claims are pending against the Company. In the opinion of
management, after consultation with counsel, disposition of these suits and
claims, either individually or in the aggregate, will not have a material
adverse effect on the Company's competitive or financial position or its
ongoing results of operations. No assurance can be given, however, that the
disposition of one or more of such suits or claims in a particular reporting
period will not be material in relation to the reported results for such
period.
In order to ensure an adequate supply of certain raw material requirements, the
Company has committed to pay its proportionate share of annual production
charges (including debt service) relating to its interests in an unincorporated
joint venture and certain associated companies. These arrangements include
minimum commitments of approximately $37 million annually through 2000 and
additional amounts thereafter which together, at present value, total $159
million at December 31, 1995, after excluding interest of $25 million and
variable operating costs of the facilities. During 1995, approximately $154
million (1994 - $190 million; 1993 - $195 million) of raw materials were
purchased under these arrangements.
Certain items of property, plant and equipment are leased under long-term
operating leases. Lease expense was approximately $46 million per year for the
years 1993 to 1995. Lease commitments at December 31, 1995, were approximately
$83 million. Leases covering major items contain renewal and/or purchase
options that may be exercised.
NOTE J - ENVIRONMENTAL EXPENDITURES
- -----------------------------------
The Company is involved in various worldwide environmental improvement
activities resulting from past operations, including designation as a
potentially responsible party (PRP), with others, at various Environmental
Protection Agency designated Superfund sites. In developing its estimate of
environmental remediation costs, the Company considers, among other things,
currently available technological solutions, alternative cleanup methods and
risk-based assessments of the contamination and, as applicable, an estimation
of its proportionate share of remediation costs. The Company may also use
external consultants, and consider, when available, estimates by other PRP's
and governmental agencies and information regarding the financial viability of
other PRP's. Based on information currently available, the Company believes it
is unlikely that it will incur substantial additional costs as a result of
failure by other PRP's to satisfy their responsibilities for remediation costs.
NOTE J - ENVIRONMENTAL EXPENDITURES - continued
- -----------------------------------------------
Amounts have been recorded which, in management's best estimate, will be
sufficient to satisfy anticipated costs of known remediation requirements. At
December 31, 1995, $242 million for estimated environmental remediation costs
had been accrued. Expenditures relating to costs currently accrued are
expected to be made over the next 15 to 20 years with the majority to be spent
by the year 2000. As a result of factors such as the continuing evolution of
environmental laws and regulatory requirements, the availability and
application of technology, the identification of presently unknown remediation
sites and the allocation of costs among potentially responsible parties,
estimated costs for future environmental compliance and remediation are
necessarily imprecise. It is not possible to predict the amount or timing of
future costs of environmental remediation which may subsequently be determined.
Based on information presently available, such future costs are not expected to
have a material adverse effect on the Company's competitive or financial
position or its ongoing results of operations. However, such costs could be
material to results of operations in a future period.
NOTE K - OPERATIONAL RESTRUCTURING AND ASSET REVALUATION COSTS
- --------------------------------------------------------------
The Company recorded $348 million in 1993 for operational restructuring and
asset revaluation costs. These charges related primarily to the Company's
plans to discontinue the manufacture of various sheet products in Illinois and
extruded shapes in Kentucky. The components of these charges were as follows:
Asset revaluation $189
Pension, health care and early retirement costs 116
Other operational restructuring costs 43
--------
Total $348
========
Substantially all of the restructuring activities for which costs were accrued
have been completed and future cash requirements are not expected to be
material.
NOTE L - COMPANY OPERATIONS
The Company serves global markets as a supplier and recycler of aluminum and
other products, with its core business being as a vertically integrated
producer of a wide variety of value-added aluminum products. The Company
produces alumina, carbon products and primary and reclaimed aluminum,
principally to supply the needs of its fabricating operations. These
fabricating operations produce aluminum foil, sheet, plate, cans, extruded
products (including heat exchanger tubing, drive shafts, bumpers and window
systems), flexible packaging and wheels, among other items. The Company also
produces a broad range of plastic products, including film, bags, containers
and lids, for consumer products, foodservice and packaging uses. The Company
markets an extensive line of consumer products under the Reynolds brand name,
including the well-known Reynolds Wrap aluminum foil. The Company's principal
markets for its products are the aluminum beverage can, packaging, consumer
products, transportation, and building and construction markets. The Company
also is engaged in the distribution of aluminum and stainless steel and other
nonaluminum industrial products to a variety of markets.
Primary aluminum is an internationally traded commodity. The price of primary
aluminum is subject to worldwide market forces of supply and demand. Prices
can be volatile and fluctuations influence the Company's financial results.
The world market is still recovering from a serious supply-demand imbalance
that began in the early 1990s, and there may be periods of marked short-term
price volatility. The Company's strategy of being a vertically integrated
producer of value-added aluminum products reduces, but does not eliminate its
exposure to these fluctuations. The Company manages its exposure
NOTE L - COMPANY OPERATIONS - continued
- ---------------------------------------
to these fluctuations, after giving consideration to market conditions, sale
and purchase transactions, overall business strategies and other factors that
affect the Company's risk profile, with contractual arrangements including
fixed-price sales contracts, fixed-price supply contracts, and forward, futures
and option contracts. Through these activities the Company balances its risk
profile consistent with management's operational strategies. In addition to
the aluminum price risk, the Company is exposed to general financial,
political, economic and business risks in connection with its worldwide
operations. The Company continues to evaluate and manage its operations in a
manner to mitigate the effects from exposure to such risks.
In order to more fully describe the nature of its operations and to supplement
the foregoing, the Company has separated its vertically integrated operations
into two groups referred to as Finished Products and Other Sales, and
Production and Processing. Summarized financial information relating to the
Company's operations and investments is as follows:
<PAGE>
NOTE L - COMPANY OPERATIONS - continued
- ---------------------------------------
<TABLE>
<CAPTION>
Domestic
Canada
-----------------------------
- ---------------------------
GEOGRAPHIC DATA 1995 1994 1993 1995
1994 1993
-----------------------------
- ---------------------------
<S> <C> <C> <C> <C>
<C> <C>
Products and services sold
Customers $5,524 $4,506 $3,966 $529
$375 $294
Transfers between areas 484 404 283 726
576 508
----------------------------
- ---------------------------
Total products and services sold $6,008 $4,910 $4,249 $1,255
$951 $ 802
============================
===========================
Operating profit (loss) $230 $27 $(19) $351
$133 $(7)
Equity in income of companies
not consolidated 8
9 8
Interest and other income 19 45 6 2
2 -
Interest expense (129) (117) (116) (31)
(28) (23)
----------------------------
- ---------------------------
Income (loss) before income taxes $120 $(45) $(129) $330
$116 $(22)
============================
===========================
Identifiable assets $4,360 $4,578 $3,991 $1,326
$1,288 $1,216
</TABLE>
- -------------------------------------------------------------------------------
- ----------------
<TABLE>
<CAPTION>
Finished products
and Other Sales
- ---------------------------------
OPERATING DATA 1995
1994 1993
- ---------------------------------
<S> <C>
<C> <C>
Products and services sold
Customers $3,535
$3,040 $2,528
Internal transfers 9
4 2
- ---------------------------------
Total products and services sold $3,544
$3,044 $2,530
=================================
Operating profit (loss) $232
$256 $146
Equity in income of companies not consolidated 14
22 7
Interest and other income
Interest expense
Income (loss) before income taxes
Operating profit (loss) includes depreciation and amortization of $94
$86 $71
Identifiable assets $1,558
$1,452 $1,253
Capital investments $157
$183 $183
<PAGE>
<CAPTION>
Other Foreign (principally Europe) Eliminations, etc.
Consolidated
- ------------------------------------ --------------------------------
- -----------------------------
1995 1994 1993 1995 1994 1993
1995 1994 1993
- ------------------------------------ --------------------------------
- -----------------------------
<C> <C> <C> <C> <C> <C>
<C> <C> <C>
$1,160 $998 $1,009
$7,213 $5,879 $5,269
176 178 161 $(1,386) $(1,158) $(952)
- ------------------------------------ --------------------------------
- -----------------------------
$1,336 $1,176 $1,170 $(1,386) $(1,158) $(952)
$7,213 $5,879 $5,269
==================================== ================================
=============================
$87 $63 $(5) $13 $(11) $(350)
$681 $212 $(381)
17 23 9 (8) (9) (8)
17 23 9
6 67 10 (5) (3) -
22 111 16
(17) (14) (20) 5 3 -
(172) (156) (159)
- ------------------------------------ --------------------------------
- -----------------------------
$93 $139 $(6) $5 $(20) $(358)
$548 $190 $(515)
==================================== ================================
=============================
$981 $975 $748 $(213) $(236) $(79)
$6,454 $6,605 $5,876
- -------------------------------------------------------------------------------
- --------------------------
<CAPTION>
Production and Processing Eliminations, etc.
Consolidated
- ------------------------------------ --------------------------------
- -----------------------------
1995 1994 1993 1995 1994 1993
1995 1994 1993
- ------------------------------------ --------------------------------
- -----------------------------
<C> <C> <C> <C> <C> <C>
<C> <C> <C>
$3,678 $2,839 $2,741
$7,213 $5,879 $5,269
809 706 660 $(818) $(710) $(662)
- ------------------------------------ --------------------------------
- -----------------------------
$4,487 $3,545 $3,401 $(818) $(710) $(662)
$7,213 $5,879 $5,269
- ------------------------------------ --------------------------------
- -----------------------------
$492 $2 $(188) $(43) $(46) $(339)
$681 $212 $(381)
11 10 10 (8) (9) (8)
17 23 9
22 111 16
(172) (156) (159)
- -----------------------------
$548 $190 $(515)
=============================
$217 $209 $216
$311 $295 $287
$4,121 $3,963 $3,686 $(83) $(84) $(15)
$5,596 $5,331 $4,924
$688 $221 $218
$845 $404 $401
</TABLE>
<PAGE>
NOTE L- COMPANY OPERATIONS - continued
- --------------------------------------
Approximately 33% of products transferred between operating areas are reflected
at cost-related prices. The remaining transfers between operating areas and
transfers between Canada, other foreign and domestic areas are reflected at
market-related prices.
Operating profit is after allocation of selling, administrative and general
expenses. It does not reflect interest expense or other items of income or
expense considered to be general corporate in nature.
The Company had investments in, and advances to, associated companies and
unincorporated joint ventures not consolidated amounting to $1,286 million,
$856 million and $833 million at the end of 1995, 1994 and 1993, respectively.
These investments and advances relate principally to Australian and Canadian
entities in the Production and Processing operating area. Corporate assets of
$858 million, $1,274 million and $952 million at the end of 1995, 1994 and
1993, respectively, consist principally of cash, investments, deferred taxes
and other assets.
Research and development expenditures were $43 million in 1995, $38 million in
1994 and $36 million in 1993.
NOTE M - CANADIAN REYNOLDS METALS COMPANY, LIMITED
- --------------------------------------------------
Financial statements and financial statement schedules for Canadian Reynolds
Metals Company, Limited, whose name was changed to Reynolds Aluminum Company of
Canada, Ltd. effective January 1, 1996, have been omitted because the
securities it has registered under the Securities Act of 1933 (thus subjecting
it to reporting requirements under Section 13 or 15(d) of the Securities
Exchange Act of 1934) are fully and unconditionally guaranteed by Reynolds
Metals Company. Financial information relating to Canadian Reynolds Metals
Company, Limited is presented herein in accordance with Staff Accounting
Bulletin 53 as an addition to the footnotes to the financial statements of
Reynolds Metals Company. Summarized financial information is as follows:
<TABLE>
<CAPTION>
Years ended December 31
---------------------------------
1995 1994 1993
---------------------------------
<S> <C> <C> <C>
Net Sales:
Customers $522 $373 $294
Parent company 619 498 377
---------------------------------
1,141 871 671
Cost of products sold 849 755 666
Net income (loss) $188 $50 $(36)
</TABLE>
<TABLE>
<CAPTION>
December 31
---------------------
1995 1994
---------------------
<S> <C> <C>
Current assets $221 $238
Noncurrent assets 1,407 1,015
Current liabilities (199) (83)
Noncurrent liabilities (632) (564)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Quarterly Results of Operations
(Unaudited)
(In millions, except per share
amounts)
1995
1994
----------------------------------------
- ---------------------------------------------
Quarter 1st 2nd 3rd 4th
1st 2nd 3rd 4th
----------------------------------------
- ---------------------------------------------
<S> <C> <C> <C> <C>
<C> <C> <C> <C>
Net sales $1,651 $1,864 $1,841 $1,857
$1,254 $1,455 $1,531 $1,639
Gross profit 259 304 307 272
88 145 158 210
Net income (loss) $82 $111 $112 $84
$(21) $12 $62 $69
========================================
=============================================
Net income (loss) per share $1.13 $1.51 $1.56 $1.15
$(0.46) $0.05 $0.86 $0.97
_________________________________
Gross profit is net sales minus cost of products sold (including manufacturing
depreciation). Net income (loss) for 1994 includes a gain of $41 million in
the third quarter from the sale of Reynolds Australia Metals, Ltd. and a gain
of $16 million in the fourth quarter from the sale of timberland in the Pacific
Northwest.
</TABLE>
<PAGE>
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
Stockholders and Board of Directors
Reynolds Metals Company
We have audited the accompanying consolidated balance sheets of Reynolds Metals
Company as of December 31, 1995 and 1994, and the related consolidated
statements of income and retained earnings, and cash flows for each of the
three years in the period ended December 31, 1995. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Reynolds Metals
Company at December 31, 1995 and 1994, and the consolidated results of its
operations and its cash flows for each of the three years in the period ended
December 31, 1995, in conformity with generally accepted accounting principles.
Ernst & Young LLP
Richmond, Virginia
February 16, 1996
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
For information concerning the directors and nominees for directorship, see the
information under the caption "Item 1. Election of Directors" in the
Registrant's Proxy Statement for the Annual Meeting of Stockholders to be held
on April 17, 1996, which information is incorporated herein by reference.
Information concerning executive officers of the Registrant is shown in Part I
- - Item 4A of this report.
Item 11. EXECUTIVE COMPENSATION
For information required by this item, see the information under the captions
"Item 1. Election of Directors - Board Compensation and Benefits", "Item 1.
Election of Directors - Other Compensation", and "Executive Compensation" in
the Registrant's Proxy Statement for the Annual Meeting of Stockholders to be
held on April 17, 1996, which information is incorporated herein by reference.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
For information required by this item, see the information under the caption
"Beneficial Ownership of Securities" in the Registrant's Proxy Statement for
the Annual Meeting of Stockholders to be held on April 17, 1996, which
information (other than that appearing under the caption "Beneficial Ownership
of Securities - Stock Ownership Guidelines") is incorporated herein by
reference.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
For information required by this item, see the information under the captions
"Item 1. Election of Directors - Other Compensation", "Executive Compensation
- - Pension Plan Table" and "Executive Compensation - Certain Arrangements" in
the Registrant's Proxy Statement for the Annual Meeting of Stockholders to be
held on April 17, 1996, which information is incorporated herein by reference.
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) The consolidated financial statements and exhibits listed below are filed
as a part of this report.
(1) Consolidated Financial Statements: Page
----
Consolidated statement of income and retained earnings -
Years ended December 31, 1995, 1994 and 1993. 33
Consolidated balance sheet - December 31, 1995 and 1994. 34
Consolidated statement of cash flows - Years ended
December 31, 1995, 1994 and 1993. 35
Notes to consolidated financial statements. 36
Report of Ernst & Young LLP, Independent Auditors. 53
(2) Financial Statement Schedules
All schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission have
been omitted because they are not required, are inapplicable or the
required information has otherwise been given.
Individual financial statements of Reynolds Metals Company have been
omitted because the restricted net assets (as defined in Accounting
Series Release 302) of all subsidiaries included in the consolidated
financial statements filed, in the aggregate, do not exceed 25% of
the consolidated net assets shown in the consolidated balance sheet
as of December 31, 1995.
Financial statements of all associated companies (20% to 50% owned)
have been omitted because no associated company is individually
significant.
(3) Exhibits
EXHIBIT 2 - None
* EXHIBIT 3.1 - Restated Certificate of Incorporation, as amended
to the date hereof. (Registration Statement No.
33-00929 on Form S-8, dated February 14, 1996,
EXHIBIT 4.1)
* EXHIBIT 3.2 - By-Laws, as amended to the date hereof. (File
No. 1-1430, Form 10-Q Report for the Quarter
Ended June 30, 1995, EXHIBIT 3.2)
EXHIBIT 4.1 - Restated Certificate of Incorporation. See
EXHIBIT 3.1.
EXHIBIT 4.2 - By-Laws. See EXHIBIT 3.2.
___________________________
*Incorporated by reference.
* EXHIBIT 4.3 - Indenture dated as of April 1, 1989 (the
"Indenture") between Reynolds Metals Company and
The Bank of New York, as Trustee, relating to
Debt Securities. (File No. 1-1430, Form 10-Q
Report for the Quarter Ended March 31, 1989,
EXHIBIT 4(c))
* EXHIBIT 4.4 - Amendment No. 1 dated as of November 1, 1991 to
the Indenture. (File No. 1-1430, 1991 Form 10-K
Report, EXHIBIT 4.4)
* EXHIBIT 4.5 - Rights Agreement dated as of November 23, 1987
(the "Rights Agreement") between Reynolds Metals
Company and The Chase Manhattan Bank, N.A. (File
No. 1-1430, Registration Statement on Form 8-A
dated November 23, 1987, pertaining to Preferred
Stock Purchase Rights, EXHIBIT 1)
* EXHIBIT 4.6 - Amendment No. 1 dated as of December 19, 1991 to
the Rights Agreement. (File No. 1-1430, 1991
Form 10-K Report, EXHIBIT 4.11)
* EXHIBIT 4.7 - Form of 9-3/8% Debenture due June 15, 1999.
(File No. 1-1430, Form 8-K Report dated June 6,
1989, EXHIBIT 4)
* EXHIBIT 4.8 - Form of Fixed Rate Medium-Term Note.
(Registration Statement No. 33-30882 on Form S-3,
dated August 31, 1989, EXHIBIT 4.3)
* EXHIBIT 4.9 - Form of Floating Rate Medium-Term Note.
(Registration Statement No. 33-30882 on Form S-3,
dated August 31, 1989, EXHIBIT 4.4)
* EXHIBIT 4.10 - Form of Book-Entry Fixed Rate Medium-Term Note.
(File No. 1-1430, 1991 Form 10-K Report, EXHIBIT
4.15)
* EXHIBIT 4.11 - Form of Book-Entry Floating Rate Medium-Term
Note. (File No. 1-1430, 1991 Form 10-K Report,
EXHIBIT 4.16)
* EXHIBIT 4.12 - Form of 9% Debenture due August 15, 2003. (File
No. 1-1430, Form 8-K Report dated August 16,
1991, Exhibit 4(a))
EXHIBIT 4.13 - Articles of Continuance of Societe d'Aluminium
Reynolds du Canada, Ltee/Reynolds Aluminum
Company of Canada, Ltd. (formerly known as
Canadian Reynolds Metals Company, Limited --
Societe Canadienne de Metaux Reynolds, Limitee)
("REYCAN"), as amended to the date hereof
EXHIBIT 4.14 - By-Laws of REYCAN, as amended to the date hereof
EXHIBIT 4.15 - Articles of Incorporation of Societe Canadienne
de Metaux Reynolds, Ltee/Canadian Reynolds Metals
Company, Ltd. ("CRM"), as amended to the date
hereof
___________________________
*Incorporated by reference.
EXHIBIT 4.16 - By-Laws of CRM, as amended to the date hereof
* EXHIBIT 4.17 - Indenture dated as of April 1, 1993 among REYCAN,
Reynolds Metals Company and The Bank of New York,
as Trustee. (File No. 1-1430, Form 8-K Report
dated July 14, 1993, EXHIBIT 4(a))
EXHIBIT 4.18 - First Supplemental Indenture, dated as of
December 18, 1995 among REYCAN, Reynolds Metals
Company, CRM and The Bank of New York, as Trustee
* EXHIBIT 4.19 - Form of 6-5/8% Guaranteed Amortizing Note due
July 15, 2002. (File No. 1-1430, Form 8-K Report
dated July 14, 1993, EXHIBIT 4(d))
EXHIBIT 9 - None
#* EXHIBIT 10.1 - Reynolds Metals Company 1982 Nonqualified Stock
Option Plan, as amended through May 17, 1985.
(File No. 1-1430, 1985 Form 10-K Report, EXHIBIT
10.2)
#* EXHIBIT 10.2 - Reynolds Metals Company 1987 Nonqualified Stock
Option Plan. (Registration Statement No.
33-13822 on Form S-8, dated April 28, 1987,
EXHIBIT 28.1)
#* EXHIBIT 10.3 - Reynolds Metals Company 1992 Nonqualified Stock
Option Plan. (Registration Statement No.
33-44400 on Form S-8, dated December 9, 1991,
EXHIBIT 28.1)
#* EXHIBIT 10.4 - Reynolds Metals Company Performance Incentive
Plan, as amended and restated effective January
1, 1996. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended March 31, 1995, EXHIBIT 10.4)
#* EXHIBIT 10.5 - Agreement dated December 9, 1987 between Reynolds
Metals Company and Jeremiah J. Sheehan. (File
No. 1-1430, 1987 Form 10-K Report, EXHIBIT 10.9)
#* EXHIBIT 10.6 - Supplemental Death Benefit Plan for Officers.
(File No. 1-1430, 1986 Form 10-K Report, EXHIBIT
10.8)
#* EXHIBIT 10.7 - Financial Counseling Assistance Plan for
Officers. (File No. 1-1430, 1987 Form 10-K
Report, EXHIBIT 10.11)
#* EXHIBIT 10.8 - Management Incentive Deferral Plan. (File No.
1-1430, 1987 Form 10-K Report, EXHIBIT 10.12)
#* EXHIBIT 10.9 - Deferred Compensation Plan for Outside Directors
as Amended and Restated Effective December 1,
1993. (File No. 1-1430, 1993 Form 10-K Report,
EXHIBIT 10.12)
_______________________________
* Incorporated by reference.
# Management contract or compensatory plan or arrangement required to
be filed as an exhibit pursuant to Item 601 of Regulation S-K.
#* EXHIBIT 10.10 - Retirement Plan for Outside Directors. (File No.
1-1430, 1986 Form 10-K Report, EXHIBIT 10.10)
#* EXHIBIT 10.11 - Death Benefit Plan for Outside Directors. (File
No. 1-1430, 1986 Form 10-K Report, EXHIBIT 10.11)
#* EXHIBIT 10.12 - Form of Indemnification Agreement for Directors
and Officers. (File No. 1-1430, Form 8-K Report
dated April 29, 1987, EXHIBIT 28.3)
#* EXHIBIT 10.13 - Form of Executive Severance Agreement between
Reynolds Metals Company and key executive
personnel, including each of the individuals
listed in Item 4A hereof. (File No. 1-1430, 1987
Form 10-K Report, EXHIBIT 10.18)
#* EXHIBIT 10.14 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective May 20,
1988. (File No. 1-1430, Form 10-Q Report for the
Quarter Ended June 30, 1988, EXHIBIT 19(a))
#* EXHIBIT 10.15 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective October
21, 1988. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended September 30, 1988, EXHIBIT
19(a))
#* EXHIBIT 10.16 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective January
1, 1987. (File No. 1-1430, 1988 Form 10-K
Report, EXHIBIT 10.22)
#* EXHIBIT 10.17 - Form of Stock Option and Stock Appreciation Right
Agreement, as approved February 16, 1990 by the
Compensation Committee of the Company's Board of
Directors. (File No. 1-1430, 1989 Form 10-K
Report, EXHIBIT 10.24)
#* EXHIBIT 10.18 - Amendment to Reynolds Metals Company 1982
Nonqualified Stock Option Plan effective January
18, 1991. (File No. 1-1430, 1990 Form 10-K
Report, EXHIBIT 10.25)
#* EXHIBIT 10.19 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective January
18, 1991. (File No. 1-1430, 1990 Form 10-K
Report, EXHIBIT 10.26)
#* EXHIBIT 10.20 - Letter Agreement dated January 18, 1991 between
Reynolds Metals Company and William O. Bourke.
(File No. 1-1430, 1990 Form 10-K Report, EXHIBIT
10.27)
#* EXHIBIT 10.21 - Form of Stock Option Agreement, as approved April
22, 1992 by the Compensation Committee of the
Company's Board of Directors. (File No. 1-1430,
Form 10-Q Report for the Quarter Ended March 31,
1992, EXHIBIT 28(a))
____________________________
* Incorporated by reference.
# Management contract or compensatory plan or arrangement required to
be filed as an exhibit pursuant to Item 601 of Regulation S-K.
#* EXHIBIT 10.22 - Consulting Agreement dated May 1, 1992 between
Reynolds Metals Company and William O. Bourke.
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended March 31, 1992, EXHIBIT 28(b))
#* EXHIBIT 10.23 - Renewal dated February 18, 1994 of Consulting
Agreement dated May 1, 1992 between Reynolds
Metals Company and William O. Bourke. (File No.
1-1430, 1993 Form 10-K Report, EXHIBIT 10.28)
#* EXHIBIT 10.24 - Reynolds Metals Company Restricted Stock Plan for
Outside Directors. (Registration Statement No.
33-53851 on Form S-8, dated May 27, 1994, EXHIBIT
4.6)
#* EXHIBIT 10.25 - Reynolds Metals Company New Management Incentive
Deferral Plan. (File No. 1-1430, Form 10-Q
Report for the Quarter Ended June 30, 1994,
EXHIBIT 10.30)
#* EXHIBIT 10.26 - Reynolds Metals Company Salary Deferral Plan for
Executives. (File No. 1-1430, Form 10-Q Report
for the Quarter Ended June 30, 1994, EXHIBIT
10.31)
#* EXHIBIT 10.27 - Reynolds Metals Company Supplemental Long Term
Disability Plan for Executives. (File No.
1-1430, Form 10-Q Report for the Quarter Ended
June 30, 1994, EXHIBIT 10.32)
#* EXHIBIT 10.28 - Amendment to Reynolds Metals Company 1982
Nonqualified Stock Option Plan effective August
19, 1994. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended September 30, 1994, EXHIBIT
10.33)
#* EXHIBIT 10.29 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective August
19, 1994. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended September 30, 1994, EXHIBIT
10.34)
#* EXHIBIT 10.30 - Amendment to Reynolds Metals Company 1992
Nonqualified Stock Option Plan effective August
19, 1994. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended September 30, 1994, EXHIBIT
10.35)
#* EXHIBIT 10.31 - Amendment to Reynolds Metals Company New
Management Incentive Deferral Plan effective
January 1, 1995. (File No. 1-1430, 1994 Form
10-K Report, EXHIBIT 10.36)
#* EXHIBIT 10.32 - Amendment to Reynolds Metals Company New
Management Incentive Deferral Plan effective
January 1, 1995 through December 31, 1996. (File
No. 1-1430, 1994 Form 10-K Report, EXHIBIT 10.37)
____________________________
* Incorporated by reference.
# Management contract or compensatory plan or arrangement required to
be filed as an exhibit pursuant to Item 601 of Regulation S-K.
#* EXHIBIT 10.33 - Amendment to Reynolds Metals Company Salary
Deferral Plan for Executives effective January 1,
1995 through December 31, 1996. (File No.
1-1430, 1994 Form 10-K Report, EXHIBIT 10.38)
#* EXHIBIT 10.34 - Form of Split Dollar Life Insurance Agreement
(Trustee Owner, Trustee Pays Premiums). (File
No. 1-1430, Form 10-Q Report for the Quarter
Ended June 30, 1995, EXHIBIT 10.34)
#* EXHIBIT 10.35 - Form of Split Dollar Life Insurance Agreement
(Trustee Owner, Employee Pays Premium). (File
No. 1-1430, Form 10-Q Report for the Quarter
Ended June 30, 1995, EXHIBIT 10.35)
#* EXHIBIT 10.36 - Form of Split Dollar Life Insurance Agreement
(Employee Owner, Employee Pays Premium). (File
No. 1-1430, Form 10-Q Report for the Quarter
Ended June 30, 1995, EXHIBIT 10.36)
#* EXHIBIT 10.37 - Form of Split Dollar Life Insurance Agreement
(Third Party Owner, Third Party Pays Premiums).
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended June 30, 1995, EXHIBIT 10.37)
#* EXHIBIT 10.38 - Form of Split Dollar Life Insurance Agreement
(Third Party Owner, Employee Pays Premiums).
(File No. 1-1430, Form 10-Q Report for the
Quarter Ended June 30, 1995, EXHIBIT 10.38)
EXHIBIT 11 - Computation of Earnings Per Share
EXHIBIT 12 - Not applicable
EXHIBIT 13 - Not applicable
EXHIBIT 16 - Not applicable
EXHIBIT 18 - None
EXHIBIT 21 - List of Subsidiaries of Reynolds Metals Company
EXHIBIT 22 - None
EXHIBIT 23 - Consent of Independent Auditors
EXHIBIT 24 - Powers of Attorney
____________________________
* Incorporated by reference.
# Management contract or compensatory plan or arrangement required to
be filed as an exhibit pursuant to Item 601 of Regulation S-K.
EXHIBIT 27 - Financial Data Schedule
EXHIBIT 28 - Not applicable
Pursuant to Item 601 of Regulation S-K, certain instruments with
respect to long-term debt of the Company are omitted because such debt
does not exceed 10 percent of the total assets of the Company and its
subsidiaries on a consolidated basis. The Company agrees to furnish a
copy of any such instrument to the Commission upon request.
(b) Reports on Form 8-K
The Registrant filed no reports on Form 8-K during the fourth quarter of
1995.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
REYNOLDS METALS COMPANY
By Richard G. Holder
Richard G. Holder, Chairman of
the Board and Chief Executive
Officer
Date March 6, 1996
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
By Henry S. Savedge, Jr. By Richard G. Holder
Henry S. Savedge, Jr., Director Richard G. Holder, Director
Executive Vice President and Chairman of the Board and
Chief Financial Officer Chief Executive Officer
(Principal Financial Officer) (Principal Executive Officer)
Date March 6, 1996 Date March 6, 1996
By *Patricia C. Barron By *William O. Bourke
Patricia C. Barron, Director William O. Bourke, Director
Date March 6, 1996 Date March 6, 1996
By *John R. Hall By *Robert L. Hintz
John R. Hall, Director Robert L. Hintz, Director
Date March 6, 1996 Date March 6, 1996
By *William H. Joyce By *Mylle Bell Mangum
William H. Joyce, Director Mylle Bell Mangum, Director
Date March 6, 1996 Date March 6, 1996
By *D. Larry Moore By Randolph N. Reynolds
D. Larry Moore, Director Randolph N. Reynolds, Director
Date March 6, 1996 Date March 6, 1996
By *James M. Ringler By Jeremiah J. Sheehan
James M. Ringler, Director Jeremiah J. Sheehan, Director
Date March 6, 1996 Date March 6, 1996
By *Robert J. Vlasic By *Joe B. Wyatt
Robert J. Vlasic, Director Joe B. Wyatt, Director
Date March 6, 1996 Date March 6, 1996
By Allen M. Earehart
Allen M. Earehart,
Vice President, Controller
(Principal Accounting Officer)
Date March 6, 1996
*By D. Michael Jones
D. Michael Jones, Attorney-in-Fact
Date March 6, 1996
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS
TO
FORM 10-K
For the fiscal year ended December 31, 1995
Commission File No. 1-1430
REYNOLDS METALS COMPANY
Attached herewith are
Exhibits 4.13, 4.14, 4.15, 4.16, 4.18, 11, 21, 23, 24 and 27
INDEX
EXHIBIT 2 - None
* EXHIBIT 3.1 - Restated Certificate of Incorporation, as amended
to the date hereof. (Registration Statement No.
33-00929 on Form S-8, dated February 14, 1996,
EXHIBIT 4.1)
* EXHIBIT 3.2 - By-Laws, as amended to the date hereof. (File
No. 1-1430, Form 10-Q Report for the Quarter Ended
June 30, 1995, EXHIBIT 3.2)
EXHIBIT 4.1 - Restated Certificate of Incorporation. See EXHIBIT
3.1.
EXHIBIT 4.2 - By-Laws. See EXHIBIT 3.2.
* EXHIBIT 4.3 - Indenture dated as of April 1, 1989 (the
"Indenture") between Reynolds Metals Company and
The Bank of New York, as Trustee, relating to Debt
Securities. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended March 31, 1989, EXHIBIT 4(c))
* EXHIBIT 4.4 - Amendment No. 1 dated as of November 1, 1991 to
the Indenture. (File No. 1-1430, 1991 Form 10-K
Report, EXHIBIT 4.4)
* EXHIBIT 4.5 - Rights Agreement dated as of November 23, 1987
(the "Rights Agreement") between Reynolds Metals
Company and The Chase Manhattan Bank, N.A. (File
No. 1-1430, Registration Statement on Form 8-A
dated November 23, 1987, pertaining to Preferred
Stock Purchase Rights, EXHIBIT 1)
* EXHIBIT 4.6 - Amendment No. 1 dated as of December 19, 1991 to
the Rights Agreement. (File No. 1-1430, 1991 Form
10-K Report, EXHIBIT 4.11)
___________________________
*Incorporated by reference.
* EXHIBIT 4.7 - Form of 9-3/8% Debenture due June 15, 1999.
(File No. 1-1430, Form 8-K Report dated June 6,
1989, EXHIBIT 4)
* EXHIBIT 4.8 - Form of Fixed Rate Medium-Term Note.
(Registration Statement No. 33-30882 on Form S-3,
dated August 31, 1989, EXHIBIT 4.3)
* EXHIBIT 4.9 - Form of Floating Rate Medium-Term Note.
(Registration Statement No. 33-30882 on Form S-3,
dated August 31, 1989, EXHIBIT 4.4)
* EXHIBIT 4.10 - Form of Book-Entry Fixed Rate Medium-Term Note.
(File No. 1-1430, 1991 Form 10-K Report, EXHIBIT
4.15)
* EXHIBIT 4.11 - Form of Book-Entry Floating Rate Medium-Term
Note. (File No. 1-1430, 1991 Form 10-K Report,
EXHIBIT 4.16)
* EXHIBIT 4.12 - Form of 9% Debenture due August 15, 2003. (File
No. 1-1430, Form 8-K Report dated August 16, 1991,
Exhibit 4(a))
EXHIBIT 4.13 - Articles of Continuance of Societe d'Aluminium
Reynolds du Canada, Ltee/Reynolds Aluminum Company
of Canada, Ltd. (formerly known as Canadian
Reynolds Metals Company, Limited -- Societe
Canadienne de Metaux Reynolds, Limitee) ("REYCAN"),
as amended to the date hereof
EXHIBIT 4.14 - By-Laws of REYCAN, as amended to the date hereof
EXHIBIT 4.15 - Articles of Incorporation of Societe Canadienne
de Metaux Reynolds, Ltee/Canadian Reynolds Metals
Company, Ltd. ("CRM"), as amended to the date
hereof
EXHIBIT 4.16 - By-Laws of CRM, as amended to the date hereof
* EXHIBIT 4.17 - Indenture dated as of April 1, 1993 among REYCAN,
Reynolds Metals Company and The Bank of New York,
as Trustee. (File No. 1-1430, Form 8-K Report
dated July 14, 1993, EXHIBIT 4(a))
EXHIBIT 4.18 - First Supplemental Indenture, dated as of
December 18, 1995 among REYCAN, Reynolds Metals
Company, CRM and The Bank of New York, as Trustee
* EXHIBIT 4.19 - Form of 6-5/8% Guaranteed Amortizing Note due
July 15, 2002. (File No. 1-1430, Form 8-K Report
dated July 14, 1993, EXHIBIT 4(d))
EXHIBIT 9 - None
___________________________
*Incorporated by reference.
* EXHIBIT 10.1 - Reynolds Metals Company 1982 Nonqualified Stock
Option Plan, as amended through May 17, 1985.
(File No. 1-1430, 1985 Form 10-K Report, EXHIBIT
10.2)
* EXHIBIT 10.2 - Reynolds Metals Company 1987 Nonqualified Stock
Option Plan. (Registration Statement No. 33-13822
on Form S-8, dated April 28, 1987, EXHIBIT 28.1)
* EXHIBIT 10.3 - Reynolds Metals Company 1992 Nonqualified Stock
Option Plan. (Registration Statement No. 33-44400
on Form S-8, dated December 9, 1991, EXHIBIT 28.1)
* EXHIBIT 10.4 - Reynolds Metals Company Performance Incentive
Plan, as amended and restated effective January 1,
1996. (File No. 1-1430, Form 10-Q Report for the
Quarter Ended March 31, 1995, EXHIBIT 10.4)
* EXHIBIT 10.5 - Agreement dated December 9, 1987 between Reynolds
Metals Company and Jeremiah J. Sheehan. (File No.
1-1430, 1987 Form 10-K Report, EXHIBIT 10.9)
* EXHIBIT 10.6 - Supplemental Death Benefit Plan for Officers.
(File No. 1-1430, 1986 Form 10-K Report, EXHIBIT
10.8)
* EXHIBIT 10.7 - Financial Counseling Assistance Plan for
Officers. (File No. 1-1430, 1987 Form 10-K Report,
EXHIBIT 10.11)
* EXHIBIT 10.8 - Management Incentive Deferral Plan. (File No.
1-1430, 1987 Form 10-K Report, EXHIBIT 10.12)
* EXHIBIT 10.9 - Deferred Compensation Plan for Outside Directors
as Amended and Restated Effective December 1, 1993.
(File No. 1-1430, 1993 Form 10-K Report, EXHIBIT
10.12)
* EXHIBIT 10.10 - Retirement Plan for Outside Directors. (File No.
1-1430, 1986 Form 10-K Report, EXHIBIT 10.10)
* EXHIBIT 10.11 - Death Benefit Plan for Outside Directors. (File
No. 1-1430, 1986 Form 10-K Report, EXHIBIT 10.11)
* EXHIBIT 10.12 - Form of Indemnification Agreement for Directors
and Officers. (File No. 1-1430, Form 8-K Report
dated April 29, 1987, EXHIBIT 28.3)
* EXHIBIT 10.13 - Form of Executive Severance Agreement between
Reynolds Metals Company and key executive
personnel, including each of the individuals listed
in Item 4A hereof. (File No. 1-1430, 1987 Form
10-K Report, EXHIBIT 10.18)
_______________________________
* Incorporated by reference.
* EXHIBIT 10.14 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective May 20,
1988. (File No. 1-1430, Form 10-Q Report for the
Quarter Ended June 30, 1988, EXHIBIT 19(a))
* EXHIBIT 10.15 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective October
21, 1988. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended September 30, 1988, EXHIBIT
19(a))
* EXHIBIT 10.16 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective January 1,
1987. (File No. 1-1430, 1988 Form 10-K Report,
EXHIBIT 10.22)
* EXHIBIT 10.17 - Form of Stock Option and Stock Appreciation Right
Agreement, as approved February 16, 1990 by the
Compensation Committee of the Company's Board of
Directors. (File No. 1-1430, 1989 Form 10-K
Report, EXHIBIT 10.24)
* EXHIBIT 10.18 - Amendment to Reynolds Metals Company 1982
Nonqualified Stock Option Plan effective January
18, 1991. (File No. 1-1430, 1990 Form 10-K Report,
EXHIBIT 10.25)
* EXHIBIT 10.19 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective January
18, 1991. (File No. 1-1430, 1990 Form 10-K Report,
EXHIBIT 10.26)
* EXHIBIT 10.20 - Letter Agreement dated January 18, 1991 between
Reynolds Metals Company and William O. Bourke.
(File No. 1-1430, 1990 Form 10-K Report, EXHIBIT
10.27)
* EXHIBIT 10.21 - Form of Stock Option Agreement, as approved April
22, 1992 by the Compensation Committee of the
Company's Board of Directors. (File No. 1-1430,
Form 10-Q Report for the Quarter Ended March 31,
1992, EXHIBIT 28(a))
* EXHIBIT 10.22 - Consulting Agreement dated May 1, 1992 between
Reynolds Metals Company and William O. Bourke.
(File No. 1-1430, Form 10-Q Report for the Quarter
Ended March 31, 1992, EXHIBIT 28(b))
* EXHIBIT 10.23 - Renewal dated February 18, 1994 of Consulting
Agreement dated May 1, 1992 between Reynolds Metals
Company and William O. Bourke. (File No. 1-1430,
1993 Form 10-K Report, EXHIBIT 10.28)
* EXHIBIT 10.24 - Reynolds Metals Company Restricted Stock Plan for
Outside Directors. (Registration Statement No.
33-53851 on Form S-8, dated May 27, 1994, EXHIBIT
4.6)
_______________________________
* Incorporated by reference.
* EXHIBIT 10.25 - Reynolds Metals Company New Management Incentive
Deferral Plan. (File No. 1-1430, Form 10-Q Report
for the Quarter Ended June 30, 1994, EXHIBIT 10.30)
* EXHIBIT 10.26 - Reynolds Metals Company Salary Deferral Plan for
Executives. (File No. 1-1430, Form 10-Q Report for
the Quarter Ended June 30, 1994, EXHIBIT 10.31)
* EXHIBIT 10.27 - Reynolds Metals Company Supplemental Long Term
Disability Plan for Executives. (File No. 1-1430,
Form 10-Q Report for the Quarter Ended June 30,
1994, EXHIBIT 10.32)
* EXHIBIT 10.28 - Amendment to Reynolds Metals Company 1982
Nonqualified Stock Option Plan effective August 19,
1994. (File No. 1-1430, Form 10-Q Report for the
Quarter Ended September 30, 1994, EXHIBIT 10.33)
* EXHIBIT 10.29 - Amendment to Reynolds Metals Company 1987
Nonqualified Stock Option Plan effective August 19,
1994. (File No. 1-1430, Form 10-Q Report for the
Quarter Ended September 30, 1994, EXHIBIT 10.34)
* EXHIBIT 10.30 - Amendment to Reynolds Metals Company 1992
Nonqualified Stock Option Plan effective August 19,
1994. (File No. 1-1430, Form 10-Q Report for the
Quarter Ended September 30, 1994, EXHIBIT 10.35)
* EXHIBIT 10.31 - Amendment to Reynolds Metals Company New
Management Incentive Deferral Plan effective
January 1, 1995. (File No. 1-1430, 1994 Form 10-K
Report, EXHIBIT 10.36)
* EXHIBIT 10.32 - Amendment to Reynolds Metals Company New
Management Incentive Deferral Plan effective
January 1, 1995 through December 31, 1996. (File
No. 1-1430, 1994 Form 10-K Report, EXHIBIT 10.37)
* EXHIBIT 10.33 - Amendment to Reynolds Metals Company Salary
Deferral Plan for Executives effective January 1,
1995 through December 31, 1996. (File No. 1-1430,
1994 Form 10-K Report, EXHIBIT 10.38)
* EXHIBIT 10.34 - Form of Split Dollar Life Insurance Agreement
(Trustee Owner, Trustee Pays Premiums). (File No.
1-1430, Form 10-Q Report for the Quarter Ended June
30, 1995, EXHIBIT 10.34)
* EXHIBIT 10.35 - Form of Split Dollar Life Insurance Agreement
(Trustee Owner, Employee Pays Premium). (File No.
1-1430, Form 10-Q Report for the Quarter Ended June
30, 1995, EXHIBIT 10.35)
* EXHIBIT 10.36 - Form of Split Dollar Life Insurance Agreement
(Employee Owner, Employee Pays Premium). (File No.
1-1430, Form 10-Q Report for the Quarter Ended June
30, 1995, EXHIBIT 10.36)
_______________________________
* Incorporated by reference.
* EXHIBIT 10.37 - Form of Split Dollar Life Insurance Agreement
(Third Party Owner, Third Party Pays Premiums).
(File No. 1-1430, Form 10-Q Report for the Quarter
Ended June 30, 1995, EXHIBIT 10.37)
* EXHIBIT 10.38 - Form of Split Dollar Life Insurance Agreement
(Third Party Owner, Employee Pays Premiums). (File
No. 1-1430, Form 10-Q Report for the Quarter Ended
June 30, 1995, EXHIBIT 10.38)
EXHIBIT 11 - Computation of Earnings Per Share
EXHIBIT 12 - Not applicable
EXHIBIT 13 - Not applicable
EXHIBIT 16 - Not applicable
EXHIBIT 18 - None
EXHIBIT 21 - List of Subsidiaries of Reynolds Metals Company
EXHIBIT 22 - None
EXHIBIT 23 - Consent of Independent Auditors
EXHIBIT 24 - Powers of Attorney
EXHIBIT 27 - Financial Data Schedule
EXHIBIT 28 - Not applicable
______________________________
* Incorporated by reference.
EXHIBIT 4.13
Quebec
CERTIFICAT DE MODIFICATION
Loi sur les compagnies, Partie IA
(L.R.Q., chap. C-38)
J'atteste par les presentes que la compagnie
SOCIETE D'ALUMINIUM REYNOLDS DU
CANADA, LTEE
et sa version
REYNOLDS ALUMINUM COMPANY OF
CANADA, LTD.
a modifie ses statuts le 1ER JANVIER 1996, sous l'autorite de la
partie IA de la Loi sur les compagnies, tel qu'indique dans les
statuts de modification ci-joints.
Deposes au registre le 15 decembre 1995
sous le matricule 1143544550
Gouvernement
du Quebec
L'Inspecteur
general des Alfred Vaillancourt
institutions Inspecteur general des institutions financieres par interim
financieres
T130D10C55S43JA
[IMAGE OF SEAL OMITTED]
<PAGE>
Gouvernement du Quebec
L'Inspecteur general
des institutions financieres
Formulaire 5
STATUTS DE MODIFICATION
Loi sur les compagnies, L.R.Q. c. C-38
Partie 1A
1. Denomination sociale
SOCIETE D'ALUMINIUM REYNOLDS DU CANADA, LTEE
REYNOLDS ALUMINUM COMPANY OF CANADA, LTD.
2. Adresse actuelle de la compagnie
1002 SHERBROOKE WEST, SUITE 2420
No Nom de la rue
MONTREAL
Municipalite
QUEBEC H3A 3L6
Province Code postal
3. ____ Requete presentee en vertu de l'article 123.140 et suivants de la Loi
sur les compagnies
4. Les statuts de la compagnie sont modifies de la facon suivante:
5. Date d'entree en vigueur, 6. Denomination sociale (ou numero
si differente de la date matricule) anterieure a la modification, si
du depot (voir instructions) differente de celle mentionnee a la case 1
JANUARY 1, 1996 SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
CANADIAN REYNOLDS METALS COMPANY, LIMITED
Si l'espace est insuffisant, joindre une annexe en deux (2) exemplaires
Signature de
l'administrateur autorise D. Michael Jones
____________________________________________________________________________
Reserve a 'l'administration
GOUVERNEMENT DU QUEBEC
DEPOSE LE
15 DEC. 1995
INSPECTEUR GENERAL DES
INSTITUTIONS FINANCIERES
<PAGE>
Gouvernement du Quebec
L'Inspecteur general
des institutions financieres
CERTIFICAT DE MODIFICATION
Loi sur les compagnies
(L.R.Q., chap. C-38)
Partie IA
J'atteste par les presentes que la compagnie
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
a modifie ses statuts, sous l'autorite de
la partie IA de la Loi sur les compagnies,
tel qu'indique dans les statuts de modifi-
cation ci-joints.
Le 1993 02 19
Jean Marie Bandchard
Inspecteur general des institutions financieres
Gouvernement
du Quebec
L'Inspecteur
general des
institutions 1171-7386
financieres
[IMAGE OF SEAL OMITTED]
<PAGE>
Gouvernement du Quebec
L'Inspecteur general
des institutions financieres
CERTIFICAT D'ENREGISTREMENT
Loi sur les compagnies
(L.R.Q., chap. C-38)
Partie IA
J'atteste par les presentes que la copie
qui accompagne le present certificat est
une copie authentique de l'original d'un
document concernant
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
et que cette copie a ete enregistree
le 1993 02 19
au libro S-3016, folio 53
Jean Marie Bandchard
Inspecteur general des institutions financieres
Gouvernement
du Quebec
L'Inspecteur
general des
institutions 1171-7386
financieres
[IMAGE OF SEAL OMITTED]
<PAGE>
Gouvernement du Quebec
L'Inspecteur general
des institutions financieres
Formulaire 5
STATUTS DE MODIFICATION
Loi sur les compagnies
Partie 1A
1. Denomination sociale ou numero matricule
Canadian Reynolds Metals Company, Limited -- Societe
Canadienne de Metaux Reynolds, Limitee
2. Les statuts de la compagnie sont modifies de la facon suivante:
Section 5 of the articles of continuance is amended by deleting therefrom
the following provision (set forth in Annex B to the articles of
continuance):
(c) Any invitation to the public to subscribe for any shares,
debentures or other securities of the company shall be prohibited.
Section 5, as so amended, reads in its entirety as set forth in the revised
Annex B to the articles of continuance attached hereto.
3. Date d'entree en vigueur, 4. Denomination sociale (ou numero matricule)
si differente de la date anterieure a la modification, si
du depot (Voir instructions) differente de celle mentionnee a la case 1
Signature de Fonction du
l'administrateur autorise signataire Director
Henry S. Savedge, Jr.
____________________________________________________________________________
Reserve a 'l'administration 1171-7386
GOUVERNEMENT DU QUEBEC
DEPOSE LE
19 FEV. 1993
L'INSPECTEUR GENERAL DES
INSTITUTIONS FINANCIERES
<PAGE>
ANNEX B TO ARTICLES OF CONTINUANCE OF
-------------------------------------
CANADIAN REYNOLDS METALS COMPANY, LIMITED--
-------------------------------------------
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
----------------------------------------------
5. Limitations on the transfers of shares, if any.
-----------------------------------------------
(a) The shares of the capital stock of the company shall not be transferred
without the consent of the Board of Directors evidenced by a resolution
adopted by them and recorded in the books of the company or the consent of
the holders of the majority in number of the outstanding shares of the
company then entitled to vote at meetings of shareholders of the company.
(b) The number of shareholders of the company shall be limited to fifty (50)
not including persons who are in the employment of the company and persons
who, having been formerly in the employment of the company were, while in
that employment and have continued after the termination of that
employment to be, shareholders of the company, two (2) or more persons
holding one (1) or more shares jointly being counted as a single
shareholder.
<PAGE>
ARTICLES OF CONTINUANCE
Form 7
(Part 1A of the Companies Act)
1 Corporate name 2 Date of incorporation
Canadian Reynolds Metals Company Limited -- July 31, 1970
Societe Canadienne De Metaux Reynolds, Limitee
3 Judicial district within Quebec chosen as the company's head-office location
Judicial District of Montreal
4 Description of the company's share capital
See Annex A.
5 Limitations on the transfer of shares, if any
See Annex B.
6 Number (or minimum and maximum number) of directors permissible
The Board of Directors of the company shall consist of such number, being
not less than three and not greater than twelve, as may be determined from
time to time by the Board of Directors.
7 Limitations imposed on activities, if any
None.
8 Other provisions
See Annex C.
Signature of
authorized Post of Vice Chairman of the Board
director William S. Leonhardt signatory and Chief Financial Officer
William S. Leonhardt Date October 1, 1982
For Departmental use only
- -------------------------------------------------------------------------------
Date filed File number
1171-7386
QUEBEC
DEPOSES
LE
1982 10 01
LE DIRECTEUR
DES
COMPAGNIES
<PAGE>
Gouvernement du Quebec
Ministere des Institutions financieres
et Cooperatives
Direction des compagnies
CERTIFICAT D'ENREGISTREMENT
(Partie 1A de la Loi sur les compagnies)
Je certifie par les presentes que chaque
document qui accompagne le present certificat
est une copie authentique de l'original d'un
document concernant
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
et qu'il a ete enregistre
le 82/10/06
au libro S-228, folio 138
Le Directeur
Hubert Jaudry
Dossier: 1171-7386
<PAGE>
Gouvernement du Quebec
Ministere des Institutions financieres
et Cooperatives
Direction des compagnies
CERTIFICAT DE CONTINUATION
(Partie 1A de la Loi sur les compagnies)
Je certifie par les presentes que
la compagnie
SOCIETE CANADIENNE DE METAUX
REYNOLDS, LIMITEE
a continue son existence sous l'autorite de la partie
1A de la Loi sur les compagnies, tel qu'indique dans
les statuts de continuation ci-joints.
Date 82/10/01
Le Directeur
Hubert Jaudry
<PAGE>
ANNEX A TO ARTICLES OF CONTINUANCE OF
-------------------------------------
CANADIAN REYNOLDS METALS COMPANY, LIMITED--
-------------------------------------------
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
----------------------------------------------
4. Description of the Company's Share Capital. The authorized share
capital of the company shall be unlimited and shall consist of:
1. An unlimited number of Common Shares, without Par Value ("Common
Shares");
2. An unlimited number of Class A Preferred Shares, $100 Par Value
("Class A Preferred");
3. An unlimited number of Class B Preferred Shares, $100 Par Value
("Class B Preferred"); and
4. An unlimited number of Class C Preferred Shares, $100 Par Value
("Class C Preferred").
The said Common Shares and the Class A Preferred, Class B Preferred and
Class C Preferred (such three classes of preferred shares hereinafter referred
to in the aggregate as the "Preferred Shares") shall carry and be subject to
the following preferences, priorities, rights, conditions, limitations and
restrictions:
(1) The holders of each class of the Preferred Shares shall, when
and as declared by the Board of Directors, be entitled, out of the funds of the
company legally available therefor, to noncumulative dividends at a rate of (a)
$10.00 per annum and no more for each share of Class A Preferred, (b) $9.50 per
annum and no more for each share of Class B Preferred, and (c) $9.00 per annum
and no more for each share of Class C Preferred. Such dividends shall be
preferential, so that in no event shall any dividend be declared, paid or set
apart for payment on the Common Shares in respect of any quarter-annual period
(other than a dividend payable solely in Common Shares) unless and until all
dividends on all then outstanding Preferred Shares for such quarter shall have
been (i) paid or (ii) declared and a sum sufficient for the payment thereof set
apart. The holders of the Preferred Shares shall not be entitled to any
dividend other than or in excess of the noncumulative dividends at the rates
provided for above. No dividends for any quarter-annual period shall be
declared, paid or set apart for payment on any class of then outstanding
Preferred Shares unless the same proportion of the annual dividend rate
respectively applicable to the shares of every class of Preferred Shares at the
time outstanding shall likewise be declared, paid or set apart as a dividend in
respect of such quarter-annual dividend period.
(2) In the event of the voluntary or involuntary liquidation,
dissolution or winding up of the company, the holders of the then outstanding
Preferred Shares shall be entitled to receive the sum of $100.00 per share,
together with all unpaid declared dividends thereon in priority to any
distribution to the holders of the then outstanding Common Shares and shall not
be entitled to share any further in the distribution of the property or assets
of the company. If, on any voluntary or involuntary liquidation, dissolution
or winding up of the company, the assets of the company are insufficient to
permit full payment to the holders of the then outstanding Preferred Shares as
herein provided, then the holders of the then outstanding Preferred Shares
shall share ratably in any distribution of assets in proportion to the full
amounts to which they would otherwise be respectively entitled. An
amalgamation of the company with or into another company or companies shall not
be deemed to be a liquidation, dissolution or winding up of the company within
the meaning of this Paragraph.
(3) The company may, at the option of the Board of Directors of the
company, redeem all or, from time to time, any part of the then outstanding
Preferred Shares on payment to the holders thereof, for each share to be
redeemed, of the amount of S100.00, together with all unpaid declared dividends
thereon. Before redeeming any Preferred Shares, the company shall mail to each
person who, at the date of such mailing, is a registered holder of shares to be
redeemed, notice of the intention of the company to redeem such shares held by
such registered holder. Such notice shall be mailed by registered or certified
post addressed to the last address of any such holder as it appears on the
records of the company or, in the event of the address of any such holder not
appearing on the records of the company, then to the last known address of such
holder, at least 10 days before the date specified for redemption. Such notice
shall set out the class to be redeemed, redemption price, the date on which
redemption is to take place and, if only part of the shares held by the person
to whom it is addressed is to be redeemed, the number thereof so to be
redeemed. On or after the date so specified for redemption, the company shall
pay or cause to be paid the redemption price to the registered holders of the
shares to be redeemed, on presentation and surrender of the certificates for
the shares so called for redemption, duly endorsed in blank, at the head office
of the company or at such other place or places as may be specified for
redemption in such notice. On and after the date so specified for redemption,
the holders of such shares called for redemption shall cease to be entitled to
any rights in respect thereof, except to receive the redemption price, without
interest, unless payment of the redemption price shall not be made by the
company in accordance with the foregoing provisions, in which case the rights
of the holders of such shares shall remain unimpaired. On or before the date
specified for redemption, the company shall have the right to deposit the
redemption price of the shares called for redemption in a special account with
a bank or trust company named in the notice of redemption to be paid, without
interest, to or to the order of the respective holders of such shares called
for redemption upon presentation and surrender of the certificates representing
the same, duly endorsed in blank, and, on the date specified for redemption,
the shares in respect whereof such deposit shall have been made shall be deemed
to have been redeemed and the rights of the several holders thereof, after such
date, shall be limited to receiving, out of the moneys so deposited, without
interest, the redemption price applicable to their respective shares against
presentation and surrender of the certificates representing such shares.
(4) The company may at any time or times purchase for cancellation
the whole or any part of the Preferred Shares outstanding from time to time
pursuant to tenders, or, with the unanimous consent of the holders of all the
then outstanding Preferred Shares (or, if only one or two classes are involved,
by the holders of all then outstanding shares of the involved class or
classes), by private contract at the lowest price at which, in the opinion of
the Board of Directors, such shares are obtainable but not exceeding the amount
of $100.00 per share, together with all unpaid declared dividends thereon.
(5) Subject to the provisions of the Companies Act (Quebec), any
holder of one or more then outstanding Preferred Shares may require the company
to redeem all or any of such shares registered in the name of such holder on
the books of the company, by tendering to the company at its head office the
share certificate(s), duly endorsed in blank, representing such share(s) which
such holder desires to have the company redeem and a written request for
redemption specifying (i) the number of shares for which redemption is sought
(the "sold shares") and (ii) the business day (the "purchase date") on which
such holder desires to have the company redeem the sold shares, which shall be
not less than 10 days after the day on which the request is given to the
company. After receipt of such share certificate(s) and request the company
shall on the purchase date redeem the sold shares by paying to such shareholder
an amount of $100 per sold share plus any unpaid declared dividends thereon.
Such payment shall be made by check payable at any branch of the company's
bank. The sold shares shall be redeemed on the purchase date and thereafter
their holders shall cease to be entitled to any rights of shareholders in
respect of the sold shares (except to receive the redemption price) unless
payment of the redemption price is not made on the purchase date, in which case
the rights of the holders of the sold shares shall remain unimpaired.
Notwithstanding the foregoing, the company shall not be obliged to purchase the
sold shares to the extent that such purchase would be contrary to any
applicable law, and if such purchase of any such sold shares would be contrary
to any applicable law, the company shall only be obliged to purchase such sold
shares to the extent that the monies applied thereto shall be such amount
(rounded to the next lower multiple of $100) as would not be contrary to such
law, in which case, the company shall pay to each holder of sold shares his pro
rata share of the purchase monies allocable and shall cause to be issued to
such holder a new share certificate representing the sold shares held by such
holder and not purchased by the company.
(6) The holders of the then outstanding Preferred Shares and
the holders of the then outstanding Common Shares shall be entitled to receive
notice of and to attend and vote at all meetings of shareholders of the company
and each share of the Preferred Shares and Common Shares then outstanding shall
confer the right to one (1) vote in person or by proxy at all meetings of
shareholders of the company.
(7) The company shall not, except by by-law passed by the Board of
Directors and confirmed by resolution by a majority of not less than two-thirds
of the votes cast by (i) the holders of each class of the then outstanding
Preferred Shares and (ii) the holders of the then outstanding Common Shares
present or represented at, and voting separately by classes at, a special
general meeting of the shareholders called for considering such resolution and
upon compliance with any relevant provisions of the laws governing the company,
(i) create any other class of shares, (ii) voluntarily liquidate or dissolve
the company, (iii) distribute any surplus of the company other than by way of
dividend or by purchase or redemption of any Preferred Shares in accordance
with the provisions of paragraphs (1), (3), (4) and (5), respectively, hereof,
or (iv) repeal, amend or otherwise alter any of the provisions contained in
paragraphs (1) to (6) hereof or in this paragraph (7).
FI2734
<PAGE>
ANNEX B TO ARTlCLES OF CONTINUANCE OF
-------------------------------------
CANADIAN REYNOLDS METALS COMPANY, LIMITED-
------------------------------------------
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
----------------------------------------------
5. Limitations on the transfers of shares, if any.
(a) The shares of the capital stock of the company shall not be
transferred without the consent of the Board of Directors evidenced
by a resolution adopted by them and recorded in the books of the
company or the consent of the holders of the majority in number of
the outstanding shares of the company then entitled to vote at
meetings of shareholders of the company.
(b) The number of shareholders of the company shall be limited to fifty
(50) not including persons who are in the employment of the company
and persons who, having been formerly in the employment of the
company were, while in that employment and have continued after the
termination of that employment to be, shareholders of the company,
two (2) or more persons holding one (1) or more shares jointly being
counted as a single shareholder.
(c) Any invitation to the public to subscribe for any shares, debentures
or other securities of the company shall be prohibited.
FI2734
<PAGE>
ANNEX C TO ARTICLES OF CONTINUATION OF
--------------------------------------
CANADIAN REYNOLDS METALS COMPANY, LIMITED--
-------------------------------------------
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
----------------------------------------------
8. Other Provisions.
(a) So long as the company has not made a distribution of its
securities to the public, the annual meeting of the shareholders of the
company may be held within or outside Quebec at such place as the Board of
Directors of the company may from time to time designate.
(b) So long as the company has not made a distribution of its
securities to the public, the shareholders of the company may participate
and vote at any shareholders' meeting by any means allowing all
participants to communicate with each other.
(c) The company shall have the power to purchase or otherwise acquire
and to hold, sell, exchange or otherwise dispose of and deal in the
property, rights and assets of, and bonds, debentures, debenture stock,
shares of all classes and securities of any form or type issued by any
individual, corporation or company, public or private, incorporated or
unincorporated.
(d) The Board of Directors may, when they deem it expedient:
(i) Borrow money upon the credit of the company;
(ii) Issue debentures or other securities of the company, and
pledge or sell the same for such sums and at such prices as may be
deemed expedient;
(iii) Notwithstanding the provisions of the Civil Code,
hypothecate, mortgage or pledge the moveable or immoveable property,
present or future, of the company, to secure any such debentures, or
other securities, or give part only of such guarantee for such
purposes; and constitute the hypothec, mortgage or pledge above
mentioned, by trust deed, in accordance with sections 28 and 29 of the
Special Corporate Powers Act (Chap. p-16), or in any other manner;
(iv) Hypothecate or mortgage the immoveable property of the
company, or pledge or otherwise affect the moveable property, or give
all such guarantees, to secure the payment of loans made otherwise
than by the issue of debentures, as well as the payment or performance
of any other debt, contract or obligation of the company.
FI2734
<PAGE>
NOTICE OF ADDRESS
OR OF CHANGE OF ADDRESS
OF HEAD OFFICE
Form 2
(Part IA of the Companies Act)
Corporate name or designating number
Canadian Reynolds Metals Company, Limited --
Societe Canadienne De Metaux Reynolds, Limitee
Notice is hereby given that the address of the head office of the company,
within the limits of the judicial district declared in the articles, is as
follows:
1100 Sherbrooke Street West
Civic number Street:
Montreal
Locality
Quebec H3A IG7
Province or country Postal code
The company Canadian Reynolds Metals Company, Limited --
Societe Canadienne De Metaux Reynolds, Limitee
Post occupied Vice Chairman of the Board
by William S. Leonhardt by signatory and Chief Financial Officer
(signature) Date October 1, 1982
William S.Leonhardt
For Departmental use only
- ------------------------------------------------------------------------------
Date filed File number
1171-7386
QUEBEC
DEPOSES
LE
1982 10 01
LE DIRECTEUR
DES
COMPAGNIES
<PAGE>
NOTICE CONCERNING
COMPOSITION OF BOARD OF DIRECTORS
Form 4
(Part IA of the Companies Act)
1. Corporate name or designating number
Canadian Reynolds Metals Company, Limited --
Societe Canadienne De Metaux Reynolds, Limitee
2. The directors of the company are:
Name and surname Full residential address Profession
(postal code included)
David P. Reynolds 905 Tresco Rd., Richmond, VA 23229 Company Executive
John. H. Galea 207 Hollyport Rd.,Richmond, VA 23229 Company Executive
William S. Leonhardt 3000 S. Ocean Blvd., Apt. 1106 Company Executive
Boca Raton, FL 33432
A. D. Reynolds, III 2956 Hathaway Rd., No. 610-612 Company Executive
Richmond, VA 23233
W. J. Bennett Chateau Apartments, #F-41 Company Executive
1321 Sherbrooke St., West
Montreal, Quebec H-3G 1J4
H. W. DeJong 15 Mance Avenue Company Executive
Baie Comeau, Quebec G4Z 1M6
Jock K. Finlayson 18 Misty Crescent Avenue Company Executive
Don Mills, Ontario MCV 1T3
If space is insufficient, join an annex See also attached Annex
The company Canadian Reynolds Metals Company, Limited -
Societe Canadienne De Metaux Reynolds Limitee
Post occupied Vice Chairman of the Board
by: William S. Leonhardt by signatory & Chief Financial Officer
(signature) Date: October 1, 1982
William S. Leonhardt
For Departmental use only
- -------------------------------------------------------------------------------
Date filed File number
QUEBEC 1171-7386
DEPOSES
LE
1982 10 01
LE DIRECTEUR
DES
COMPAGNIES
<PAGE>
ANNEX TO FORM 4
NOTICE CONCERNING
COMPOSITION OF BOARD OF DIRECTORS
H. V. Helton 10800 Whitaker Woods Road Company Executive
Richmond, VA 23233
Randolph N. Reynolds 8605 River Road Company Executive
Richmond, VA 23229
Warren Y. Soper 1415 Scarboro Road Company Executive
Montreal, Quebec H3P 2S2
<PAGE>
Gouvernement du Quebec
L'Inspecteur general CERTIFICAT D'ENREGISTREMENT
des Institutions financieres Loi sur les compagnies
(L.R.Q., chap. C-38)
Partie IA
J'atteste par les presentes que la copie
qui accompagne le present certificat est
une copie authentique de l'original d'un
document concernant
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
et que cette copie a ete enregistree
le 1986 08 12
au libro S-877 , folio 100
Jean Marie Bandchard
Inspecteur general des institutions financieres
Gouvernement
du Quebec -
L'Inspecteur
general des
institutions
financieres
[IMAGE OF SEAL OMITTED]
Dossier: 1171-7386
<PAGE>
Gouvernement du Quebec CERTIFICAT DE MODIFICATION
L'Inspecteur general Loi sur Ies compagnies
des Institutions financieres (L.R.Q. chap. C-38)
Partie IA
J 'atteste par les presentes que la compagnie
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
a modifie ses statuts, sous l'autorite de la partie IA de la Loi
sur les compagnies, tel qu'indique dans les statuts de modification
ci-joints.
Le 1986 08 11
Jean Marie Bandchard
Inspecteur general des institutions financieres
Gouvernement
du Quebec -
L'Inspecteur
general des
institutions
financieres
[IMAGE OF SEAL OMITTED]
<PAGE>
FORM 5
ARTICLES OF AMENDMENT
The Companies Act
Part IA
1 Corporate name or designating number
CANADIAN REYNOLDS METALS COMPANY, LIMITED
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
2 The company's articles are amended as follows:
Section 6 of the articles of continuance be and is hereby deleted and
replaced by the following:
[6 Precise number of minimum and maximum number of directors]
[Minimum: 3 Maximum:13]
The Board of Directors of the company shall consist of such number, being
not less than three and not greater than thirteen, as may be determined from
time to time by the Board of Directors.
3 Effective date, if different 4 Corporate name, or designating number,
from date of filing prior to amendment
(if different from that mentioned in Item 1)
Signature of Post occupied
authorized director John H. Galea by signatory Director
John H. Galea
_____________________________________________________________________________
For departmental use only 1171-7386
Gouvernement
du Quebec
Depose le
1986 08 11
Gouvernement du Quebec
L'Inspecteur general CERTIFICAT D'ENREGISTREMENT
des Institutions financieres Loi sur les compagnies
(L.R.Q., chap. C-38)
Partie IA
J 'atteste par les presentes que la copie qui accompagne le
present certificat est une copie authentique de l'original d'un
document concernant
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
et que cette copie a ete enregistree
le 1988 03 04
au libro S-1384 , folio 85
Jean Marie Bandchard
Inspecteur general des institutions financieres
Gouvernement
du Quebec -
L'Inspecteur 1171-7386
general des
institutions
financieres
[IMAGE OF SEAL OMITTED]
<PAGE>
Gouvernement du Quebec
L'Inspecteur general CERTIFICAT DE MODIFICATION
des Institutions financieres Loi sur les compagnies
(L.R.Q., chap. C-38)
Partie IA
J 'atteste par les presentes que la compagnie
SOCIETE CANADIENNE DE METAUX REYNOLDS,
LIMITEE
a modifie ses statuts, sous l'autorite de
la partie IA de la Loi sur les compagnies,
tel qu'indique dans les statuts de modifi-
cation ci-joints
Le 1988 02 29
Jean Marie Bandchard
Inspecteur general des institutions financieres
Gouvernement
du Quebec -
L'Inspecteur 1171-7386
general des
institutions
financieres
[IMAGE OF SEAL OMITTED]
<PAGE>
Form 5
ARTICLES OF AMENDMENT
The Companies Act
Part IA
1 Corporate name or designating number
CANADIAN REYNOLDS METALS COMPANY, LIMITED
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
2 The company's articles are amended as follows:
Section 4 of the articles of continuance be and is
hereby deleted and replaced by the following:
A Description of share capital
See Annex A
3 Effective date, if different 4 Corporate name, or designating number,
from date of filing prior to amendment (if different from
that mentioned in Item 1)
Signature of Post occupied
authorized director John H. Galea by signatory Director
John H. Galea
_______________________________________________________________________________
For departmental use only 1171-7386
Gouvernement
du Quebec
Depose le
1988 02 29
ANNEX A TO ARTICLES OF AMENDMENT OF
-----------------------------------
CANADIAN REYNOLDS METALS COMPANY, LIMITED--
-------------------------------------------
SOCIETE CANADIENNE DE METAUX REYNOLDS, LIMITEE
----------------------------------------------
4. Description of the Company's Share Capital. The authorized share
capital of the company shall be unlimited and shall consist of:
1. An unlimited number of Common Shares, Without Par Value ("Common
Shares");
2. An unlimited number of Class A Preferred Shares, $100 Par Value
("Class A Preferred");
3. An unlimited number of Class B Preferred Shares, $l00 Par Value
("Class B Preferred");
4. An unlimited number of Class C Preferred Shares, $100 Par Value
("Class C Preferred"); and
5. An unlimited number of Class D Preferred Shares, $100 Par Value
("Class D Preferred").
The said Common Shares and the Class A Preferred, Class B Preferred, Class
C Preferred and Class D Preferred (such four classes of preferred shares
hereinafter referred to in the aggregate as the "Preferred Shares") shall carry
and be subject to the following preferences, priorities, rights, conditions,
limitations and restrictions:
(1) The holders of each class of the Preferred Shares shall, when and
as declared by the Board of Directors, be entitled, out of the funds of
the company legally available therefor, to noncumulative dividends at a
rate of (a) $10.00 per annum and no more for each share of Class A
Preferred, (b) $9.50 per annum and no more for each share of Class B
Preferred, (c) $9.00 per annum and no more for each share of Class C
Preferred, and (d) $8.75 per annum and no more for each share of Class D
Preferred. Such dividends shall be preferential, so that in no event
shall any dividend be declared, paid or set apart for payment on the
Common Shares in respect of any quarter-annual period (other than a
dividend payable solely in Common Shares) unless and until all dividends
on all then outstanding Preferred Shares for such quarter shall have
been (i) paid or (ii) declared and a sum sufficient for the payment
thereof set apart. The holders of the Preferred Shares shall not be
entitled to any dividend other than or in excess of the noncumulative
dividends at the rates provided for above. No dividends for any
quarter-annual period shall be declared, paid or set apart for payment on
any class of then outstanding Preferred Shares unless the same proportion
of the annual dividend rate respectively applicable to the shares of every
class of Preferred Shares at the time outstanding shall likewise be
declared, paid or set apart as a dividend in respect of such
quarter-annual dividend period.
(2) In the event of the voluntary or involuntary liquidation,
dissolution or winding up of the company, the holders of the then
outstanding Preferred Shares shall be entitled to receive the sum of
$100.00 per share, together with all unpaid declared dividends thereon in
priority to any distribution to the holders of the then outstanding Common
Shares and shall not be entitled to share any further in the distribution
of the property or assets of the company. If, on any voluntary or
involuntary liquidation, dissolution or winding up of the company, the
assets of the company are insufficient to permit full payment to the
holders of the then outstanding Preferred Shares as herein provided, then
the holders of the then outstanding Preferred Shares shall share ratably
in any distribution of assets in proportion to the full amounts to which
they would otherwise be respectively entitled. An amalgamation of the
company with or into another company or companies shall not be deemed to
be a liquidation, dissolution or winding up of the company within the
meaning of this Paragraph.
(3) The company may, at the option of the Board of Directors of the
company, redeem all or, from time to time, any part of the then
outstanding Preferred Shares on payment to the holders thereof, for each
share to be redeemed, of the amount of $100.00, together with all unpaid
declared dividends thereon. Before redeeming any Preferred Shares, the
company shall mail to each person who, at the date of such mailing, is a
registered holder of shares to be redeemed, notice of the intention of the
company to redeem such shares held by such registered holder. Such notice
shall be mailed by registered or certified post addressed to the last
address of any such holder as it appears on the records of the company or,
in the event of the address of any such holder not appearing on the
records of the company, then to the last known address of such holder, at
least 10 days before the date specified for redemption. Such notice shall
set out the class to be redeemed, redemption price, the date on which
redemption is to take place and, if only part of the shares held by the
person to whom it is ad-dressed is to be redeemed, the number thereof so
to be redeemed. On or after the date so specified for redemption, the
company shall pay or cause to be paid the redemption price to the
registered holders of the shares to be redeemed, on presentation and
surrender of the certificates for the shares so called for redemption,
duly endorsed in blank, at the head office of the company or at such other
place or places as may be specified for redemption in such notice. On and
after the date so specified for redemption, the holders of such shares
called for redemption shall cease to be entitled to any rights in respect
thereof, except to receive the redemption price, without interest, unless
payment of the redemption price shall not be made by the company in
accordance with the foregoing provisions, in which case the rights of the
holders of such shares shall remain unimpaired. On or before the date
specified for redemption, the company shall have the right to deposit the
redemption price of the shares called for redemption in a special account
with a bank or trust company named in the notice of redemption to be paid,
without interest, to or to the order of the respective holders of such
shares called for redemption upon presentation and surrender of the
certificates representing the same, duly endorsed in blank, and, on the
date specified for redemption, the shares in respect whereof such deposit
shall have been made shall be deemed to have been redeemed and the rights
of the several holders thereof, after such date, shall be limited to
receiving, out of the moneys so deposited, without interest, the
redemption price applicable to their respective shares against
presentation and surrender of the certificates representing such shares.
(4) The company may at any time or times purchase for cancellation
the whole or any part of the Preferred Shares outstanding from time to
time pursuant to tenders, or, with the unanimous consent of the holders of
all the then outstanding Preferred Shares (or, if only one, two or three
classes are involved, by the holders of all then outstanding shares of the
involved class or classes), by private contract at the lowest price at
which, in the opinion of the Board of Directors, such shares are
obtainable but not exceeding the amount of $100.00 per share, together
with all unpaid declared dividends thereon.
(5) Subject to the provisions of the Companies Act (Quebec), any
holder of one or more then outstanding Preferred Shares may require the
company to redeem all or any of such shares registered in the name of such
holder on the books of the company, by tendering to the company at its
head office the share certificate(s), duly endorsed in blank, representing
such share(s) which such holder desires to have the company redeem and a
written request for redemption specifying (i) the number of shares for
which redemption is sought (the "sold shares") and (ii) the business day
(the "purchase date") on which such holder desires to have the company
redeem the sold shares, which shall be not less than 10 days after the day
on which the request is given to the company. After receipt of such share
certificate(s) and request the company shall on the purchase date redeem
the sold shares by paying to such shareholder an amount of $100 per sold
share plus any unpaid declared dividends thereon. Such payment shall be
made by check payable at any branch of the company's bank. The sold
shares shall be redeemed on the purchase date and thereafter their holders
shall cease to be entitled to any rights of shareholders in respect of the
sold shares (except to receive the redemption price) unless payment of the
redemption price is not made on the purchase date, in which case the
rights of the holders of the sold shares shall remain unimpaired.
Notwithstanding the foregoing, the company shall not be obliged to
purchase the sold shares to the extent that such purchase would be
contrary to any applicable law, and if such purchase of any such sold
shares would be contrary to any applicable law, the company shall only be
obliged to purchase such sold shares to the extent that the monies applied
thereto shall be such amount (rounded to the next lower multiple of $100)
as would not be contrary to such law, in which case, the company shall pay
to each holder of sold shares his pro rata share of the purchase rnonies
allocable and shall cause to be issued to such holder a new share
certificate representing the sold shares held by such holder and not
purchased by the company.
(6) The holders of the then outstanding Preferred Shares and the
holders of the then outstanding Common Shares shall be entitled to receive
notice of and to attend and vote at all meetings of shareholders of the
company and each share of the Preferred Shares and Common Shares then
outstanding shall confer the right to one (1) vote in person or by proxy
at all meetings of shareholders of the company.
(7) The company shall not, except by by-law passed by the Board of
Directors and confirmed by resolution by a majority of not less than
two-thirds of the votes cast by (i) the holders of each class of the then
outstanding Preferred Shares and (ii) the holders of the then outstanding
Common Shares present or represented at, and voting separately by classes
at, a special general meeting of the shareholders called for considering
such resolution and upon compliance with any relevant provisions of the
laws governing the company, (i) create any other class of shares, (ii)
voluntarily liquidate or dissolve the company, (iii) distribute any
surplus of the company other than by way of dividend or by purchase or
redemption of any Preferred Shares in accordance with the provisions of
paragraphs (1), (3), (4) and (5), respectively hereof, or (iv) repeal,
amend or otherwise alter any of the provisions contained in paragraphs (1)
to (6) hereof or in this paragraph (7).
EXHIBIT 4.14
BY-LAWS
(consisting of General and Special By-Laws)
of
SOCIETE D'ALUMINIUM REYNOLDS DU CANADA, LTEE
REYNOLDS ALUMINUM COMPANY OF CANADA, LTD.
(Incorporated under the Laws of the Province of Quebec)
<PAGE>
GENERAL BY-LAWS
GENERAL BY-LAW NO. 1
ARTICLE I - Shares
1. Share Certificates. Share certificates shall be issued in numerical
order, be signed by the Chairman of the Board of Directors, the President or a
Vice President who is a director, and by the Secretary or an Assistant
Secretary, or the Treasurer or an Assistant Treasurer, and sealed with the
corporate seal.
2. Transfers of Shares. Transfers of shares shall be made only upon the
register of transfers of the company, and only by the person named in the
certificate or by attorney, lawfully constituted in writing, and only upon
surrender of the certificate therefor. The Board of Directors may by
resolution make reasonable regulations for the transfers of shares.
3. Holders of Record. Registered shareholders only shall be entitled to
be treated by the company as the holders in fact of the shares standing in
their respective names and the company shall not be bound to recognize any
equitable or other claim to or interest in any share on the part of any other
person, whether or not it shall have express or other notice thereof, except as
expressly provided by the laws of Quebec.
4. Lost or Destroyed Certificates. In case of loss or destruction of
any share certificate another may be issued in its place upon satisfactory
proof of such loss or destruction and upon the giving of a satisfactory bond of
indemnity to the company, all as determined either expressly by the Board of
Directors or pursuant to general authority granted by them.
ARTICLE II - Shareholders' Meetings
1. Place of Meetings. Subject to paragraph 2 of this Article II, unless
otherwise prescribed by law or by the articles of the company, meetings of the
shareholders shall be held at such place, within or outside Quebec, as the
Board of Directors may determine.
2. Annual Meeting. So long as the company has not made a distribution
of its securities to the public, the annual meeting of the shareholders of the
company, for the election of directors and for the transaction of such other
business as may properly come before the meeting, may be held within or outside
Quebec at such place as the Board of Directors may from time to time designate.
The annual meeting of the shareholders shall be held on the first Friday after
April 15th of each year, if not a legal holiday, and if a legal holiday, then
on the first business day following, at 10:00 o'clock in the A.M., or on such
other date and at such other time as may be fixed by the Board of Directors.
If the annual meeting of the shareholders be not held as herein prescribed, the
election of directors may be held at any meeting of shareholders thereafter
called pursuant to the By-Laws of the company.
3. Special Meetings. Special meetings of the shareholders may be called
by the Chairman of the Board of Directors, or by the President, or by the Board
of Directors, and shall be called at any time by the Board of Directors or, if
there is not a quorum in office, the director or directors which remain, upon
receipt by the Secretary of the company of a request in writing of shareholders
owning not less than one-tenth of the subscribed shares of the company. Such
request must state the purpose of the meeting.
If such meeting is not called and held within twenty-one days of the date
on which the requisition is delivered to the Secretary of the company, any
group of shareholders, whether signatories to the requisition or not, who hold
in the aggregate not less than one-tenth of the outstanding voting shares of
the company, may themselves call the meeting.
4. Notice of Meetings. Written notice of the place, date and hour of
the annual and of all special meetings of the shareholders and, in the case of
special meetings, of the purpose or purposes for which such special meeting is
called, shall be given in the manner specified in Section 1 of Article VII of
these By-Laws not less than ten (10) nor more than sixty (60) days prior to the
meeting, to each shareholder of record of the company entitled to vote thereat.
Business transacted at all special meetings shall be confined to the purposes
stated in the notice.
The attendance of a shareholder at a meeting constitutes waiver of notice
thereof or of any irregularity in the notice except where he attends for the
express purpose of objecting to the holding of the meeting on the grounds that
the manner of calling it was irregular.
5. Quorum. A quorum at any annual or special meeting of the
shareholders shall consist of shareholders holding a majority of the shares of
the company outstanding and entitled to vote thereat, represented either in
person or by proxy, except as otherwise specifically provided by law, in the
articles of the company or in the By-Laws of the company. Where the company
has only one shareholder or only one holder of any class or series of shares,
the shareholder present in person or by proxy constitutes a quorum.
6. Adjourned Meetings. If a quorum be not present at a properly called
shareholders' meeting, the meeting may be adjourned from time to time by a
majority in interest of those present in person or by proxy and entitled to
vote thereat. At any such adjourned meeting at which a quorum shall be
present, any business may be transacted which might have been transacted at the
meeting as originally notified. If the adjournment is for more than thirty
(30) days, or if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given to each
shareholder of record entitled to vote at the meeting; otherwise, no notice of
such adjourned meeting need be given if the time and place thereof are
announced at the meeting at which the adjournment is taken. The absence from
any meeting of shareholders holding the number of shares of stock of the
company required by law, the articles of the company or the By-Laws of the
company for action upon any given matter shall not prevent action at such
meeting upon any other matter or matters which may properly come before the
meeting, if there shall be present thereat in person or by proxy shareholders
holding the number of shares of the company required in respect of such other
matter or matters.
7. Voting. Unless otherwise prescribed by law or by the articles of the
company, and subject to the provisions of Article VI, Section 2 of these
By-Laws, each holder of shares of a class which is entitled to vote in any
election or on any other questions at any annual or special meeting of the
shareholders shall be entitled to one vote, in person or by written proxy, for
each share of such class held of record. However, no shareholder in arrears in
respect of any call may vote at a shareholders' meeting. Except where, and to
the extent that, a different percentage of votes and/or a different exercise of
voting power is prescribed by law, the articles of the company or the By-Laws
of the company, all elections and other questions shall be decided by the
holders of a majority in number of the shares of the company present in person
or by proxy and entitled to vote. The votes for directors and the votes upon
any question before the meeting shall be cast by such method as the Chairman of
the Board of Directors prescribes, provided that any shareholder or proxy may
demand a poll in respect of any matter submitted to the vote of the
shareholders. In case of an equality of votes, the chairman of the meeting
shall not have a second or casting vote in addition to the vote or votes to
which he may be entitled as a shareholder.
8. Consents in Writing. Any action which might have been taken by a
vote of the shareholders at a meeting thereof may be taken by them without a
meeting, without prior notice and without a vote, if a resolution in writing
setting forth the action so taken shall be signed by all the holders of
outstanding shares entitled to vote at a shareholders' meeting of the company
on that resolution.
9. Irregularities and Omissions. Any irregularities affecting the
notice of meeting or its expedition, the involuntary omission to give any such
notice or the fact that such a notice has not been received by a shareholder,
shall not affect in any manner the validity of the meeting of shareholders.
Furthermore, the involuntary omission of the general nature of an item of
business which should have been mentioned in the notice of the meeting as being
on the agenda of the meeting does not prevent such item of business from being
considered and voted upon at the meeting, unless a shareholder suffers
prejudice or his interests are injured as a result. A certificate signed by
the Secretary or any other duly authorized officer of the company or any
registrar or transfer agent for shares of the company shall constitute
conclusive evidence of the expedition of a notice of meeting to the
shareholders and the shareholders shall be bound by such certificate.
10. Participation by Telephone. So long as the company has not made a
distribution of its securities to the public, the shareholders may participate
and vote at a shareholders' meeting by any means allowing all the participants
to communicate with each other if all the shareholders entitled to participate
and vote at the meeting consent thereto.
ARTICLE III - Board of Directors
1. Number, Term of Office and Powers. The business and affairs of the
company shall be under the direction of a Board of Directors, consisting of
such minimum and maximum number of persons as may be set out in the articles of
the company, the exact number of which shall be fixed from time to time by
resolution of the Board of Directors. Until such time as the Board of
Directors shall by resolution fix a different number of directors, the Board of
Directors shall consist of ten (10) persons. Each director shall be elected
for a term running from the date of his election to the next annual meeting of
shareholders, but, notwithstanding the expiration of his term, each director
shall remain in office until he is re-elected, replaced or removed. Directors
need not be shareholders and need not be residents of Canada or Quebec. In
addition to the power and authority expressly conferred upon them by the
By-Laws and the articles, the Board of Directors may exercise all such powers
of the company and do all such lawful acts and things as are not by law or by
the articles of the company or by the By-Laws of the company directed or
required to be exercised or done by the shareholders.
2. Resignations. Any director may resign at any time by giving written
notice of resignation to the Board of Directors, to the Chairman of the Board
of Directors or to the Secretary of the company. Any such resignation shall
take effect at the time specified therein, or if the time be not specified
therein, then upon receipt thereof. The acceptance of such resignation shall
not be necessary to make it effective.
3. Vacancies. Except as otherwise specifically provided by law, by the
articles of the company or by the By-Laws of the company, all vacancies in the
Board of Directors, whether caused by resignation, death, increase in the
number of authorized directors or otherwise, may be filled by a majority of the
Board of Directors then in office, even though less than a quorum, or by the
shareholders at a special meeting. A director thus elected to fill any vacancy
shall hold office until he is re-elected, replaced or removed.
4. Annual Meeting. The annual meeting of the Board of Directors, for
the election of officers and the transaction of other business, shall be held
on the same day and at the same place as, and as soon as practicable following,
the annual meeting of shareholders, or at such other date, time or place as the
Board of Directors may by resolution designate.
5. Regular Meetings. Regular meetings of the Board of Directors shall
be held at such times, and at such place within or outside Quebec, as the Board
of Directors may from time to time by resolution designate.
6. Special Meetings. Special meetings of the Board of Directors may be
called at any time by the Chairman of the Board of Directors; or any Vice
Chairman of the Board of Directors; or the President; or by the Secretary upon
written request of one-third of the directors, such request stating the purpose
for which the meeting is to be called. Special meetings shall be held at the
principal office of the company or at such office within or outside Quebec as
the directors may from time to time designate.
7. Notice of Meetings. Except as otherwise required by law, notice of
special meetings of the Board of Directors shall be given to each director, at
least two days before the day on which the meeting is to be held, by personal
delivery, mail, telegram, telephone, radio, cable or other comparable means.
Such notice shall state the time and place of such meeting, but need not state
the purpose thereof unless otherwise required by law. No notice need be given
of the annual meeting of the Board of Directors or of regular meetings,
provided that, whenever the time or place of such meetings shall be fixed or
changed, notice of such action shall be mailed promptly to each director who
shall not have been present at the meeting at which such action was taken.
8. Quorum; Adjourned Meetings; Required Vote. A majority of the Board
of Directors as constituted from time to time shall be necessary and sufficient
at all meetings to constitute a quorum for the transaction of business. In the
absence of a quorum, a majority of those present may adjourn the meeting from
time to time and the meeting may be held as adjourned without further notice
provided a quorum be present at such adjourned meeting. Unless otherwise
specifically provided by law, by the articles of the company or by the By-Laws
of the company, the act of a majority of the directors present at any properly
convened meeting at which there is a quorum, but in no case less than one-third
of all of the directors then in office, shall be the act of the Board of
Directors.
9. Advisory Committees. Standing or temporary advisory committees may
be appointed from their own number by the Board of Directors from time to time,
and the directors may from time to time vest such committees with such advisory
powers as the directors may see fit, subject to such conditions as the
directors may prescribe or as may be prescribed by the laws of Quebec. All
advisory committees shall consist of two or more directors. The term of office
of the members of each advisory committee shall be as fixed from time to time
by the Board of Directors; provided, however, that any committee member who
ceases to be a director shall ipso facto cease to be a committee member. Any
member of an advisory committee may be removed at any time with or without
cause by the Board of Directors, and any vacancy in the committee may be filled
by the Board of Directors. All advisory committees shall keep regular minutes
of their transactions and shall cause them to be recorded in books kept for
that purpose in the office of the company, and shall report the same to the
Board of Directors at their regular meetings. Subject to this Section 9 and
except as otherwise determined by the Board of Directors, each advisory
committee may make rules for the conduct of its business.
10. Compensation. Subject to the articles or any unanimous shareholders'
agreement, directors, as such, may receive, pursuant to resolution of the Board
of Directors, fixed fees, other compensation and expenses for their services as
directors, including, without limitation, services as chairmen or as members of
committees of the Board of Directors; provided, however, that nothing herein
contained shall be construed to preclude any director from serving the company
in any other capacity and receiving compensation therefor.
11. Consents in Writing. Any action required or permitted to be taken at
any meeting of the Board of Directors may be taken without a meeting if all
members of the Board of Directors entitled to vote thereon at a meeting thereof
sign a resolution in writing setting forth the actions so taken, and the
writing or writings are filed with the minutes of proceedings of the Board of
Directors.
12. Participation by Conference Telephone. Members of the Board of
Directors may participate in a meeting thereof, if all such members consent, by
means of conference telephone or similar communications equipment by means of
which all persons participating in the meeting can hear each other, and
participation in a meeting by such means shall constitute presence in person at
the meeting.
13. Validation. All acts done at any meeting of the directors by any
person or persons acting as a director or directors shall, notwithstanding that
it be afterwards discovered that there was a defect in the appointment of any
such director or directors or person or persons acting as aforesaid, or that
they or any of them were disqualified as directors, be as valid as if every
such person or persons had been duly appointed and qualified as directors.
ARTICLE IV - Officers
1. Officers. The company may have a Chairman of the Board of Directors,
one or more Vice Chairmen of the Board of Directors, a President, one or more
Vice Presidents, which may include Executive and Senior Vice Presidents, a
General Counsel, a Secretary, a Treasurer, a Controller and such other officers
and assistant officers as the Board of Directors shall deem appropriate;
provided, that the company shall have such officers as are required by
applicable law. Officers shall be elected annually by the Board of Directors.
One person may hold more than one office.
2. Chairman of the Board. The Chairman of the Board of Directors shall
preside at all meetings of shareholders and directors, shall be the chief
executive officer of the company and, subject to the direction of the Board of
Directors, shall have general supervision and management of the business and
affairs of the company and shall perform all such duties as are incident to
such office or are properly required by the Board of Directors. The Chairman
of the Board shall be a director.
3. Vice Chairmen of the Board. A Vice Chairman of the Board of
Directors shall perform all such duties as are properly required by the Board
of Directors. A Vice Chairman of the Board shall be a director.
4. President. The President shall be the chief operating officer of the
company and shall, subject to the direction of the Board of Directors and the
Chairman of the Board of Directors, direct and supervise the business and
affairs of the company and shall perform all such other duties as are incident
to such office or as are properly required by the Board of Directors or the
Chairman of the Board of Directors. During the absence or disability of the
Chairman of the Board of Directors, or in the event such office remains vacant,
the President shall exercise all powers and discharge all the duties of the
Chairman of the Board of Directors. The President shall be a director.
5. Executive Vice Presidents and Vice Presidents. Each of the Executive
Vice Presidents and other Vice Presidents shall perform such duties as are
properly required by the Board of Directors, the Chairman of the Board of
Directors or the President. If any Executive Vice President or other Vice
President shall be elected and designated the "General Manager" by the Board of
Directors, during the absence of the President, he shall, subject to the
direction of the Board of Directors, the Chairman of the Board of Directors and
the President, direct and supervise the business and affairs of the company and
shall perform all such other duties as are incident to such office or as are
properly required by the Board of Directors, the Chairman of the Board of
Directors, or the President.
6. General Counsel. The General Counsel shall advise the company on
legal matters affecting the company and its activities, shall supervise and
direct the handling of all such legal matters and shall perform all such other
duties as are incident to the office of General Counsel.
7. Treasurer. The Treasurer shall have the custody of all moneys and
securities of the company and shall keep or cause to be kept accurate accounts
of all moneys received or payments made in books kept for that purpose. The
Treasurer shall deposit or cause to be deposited funds of the company in
accordance with Article V, Section 2 of these By-Laws and shall disburse the
funds of the company by checks or vouchers as authorized by the Board of
Directors. The Treasurer shall also perform all other duties incident to the
office of Treasurer.
8. Secretary. The Secretary shall keep the minutes of the meetings of
the shareholders and of the Board of Directors, and, when required, the minutes
of the meetings of the Executive Committee, and shall be responsible for the
custody of all such minutes. The Secretary shall be responsible for the
custody of the stock ledger and documents of the company. The Secretary shall
have custody of the corporate seal and shall affix and attest such seal to any
instrument whose execution under seal shall have been duly authorized and enjoy
all other powers incident to the office of Secretary.
9. Secretary - Treasurer. Whenever one person is to hold the offices of
Secretary and Treasurer, he may, at the option of the Board of Directors, be
elected and designated as the "Secretary-Treasurer," and references to the
"Secretary" or to the "Treasurer" shall be deemed to include the
"Secretary-Treasurer."
10. Controller. The Controller shall be the chief accounting officer
of the company. The Controller shall keep or cause to be kept all books of
accounts and accounting records of the company and shall keep and maintain, or
cause to be kept and maintained, adequate and correct accounts of the
properties and business transactions of the company. The Controller shall
prepare or cause to be prepared appropriate financial statements for the
company and shall have such other powers and perform such other duties as may
be incident to the office of Controller.
11. Other Officers and Assistant Officers. All other officers and
assistant officers shall exercise such powers and perform such duties as shall
be determined from time to time by the Board of Directors.
12. Term of Office; Vacancies. Each officer shall hold office until the
annual meeting of the Board of Directors following the end of the term of the
Board by which such officer is elected, except in the case of earlier death,
resignation or removal. Vacancies in any office arising from any cause may be
filled by the directors at any regular or special meeting.
13. Removal. Any officer elected or appointed by the Board of Directors
may be removed at any time, with or without cause, by the Board of Directors.
ARTICLE V - Dividends and Finance
1. Dividends. Subject to the provisions of the laws of Quebec, the
Board of Directors may from time to time by resolution declare dividends
payable to the shareholders according to their respective rights and interests
in the company. Dividends may be paid in money or property or by issuing fully
paid shares of the company. The Directors may deduct from the dividends
payable to a shareholder any amounts owed by the shareholder to the company by
virtue of a call or calls or for any other reason.
2. Deposits; Withdrawals; Notes and Other Instruments. The moneys of the
company shall be deposited in the name of the company in such banks or trust
companies as shall be designated by the Board of Directors or by an officer or
assistant officer of the company to whom the Board of Directors has delegated
such authority, and shall be drawn out only by persons designated, from time to
time, by the Board of Directors or by an officer or assistant officer of this
company to whom the Board of Directors has delegated such authority. All notes
and other instruments for the payment of money shall be signed or endorsed by
officers or other persons authorized from time to time by the Board of
Directors or by an officer or assistant officer of this company to whom the
Board of Directors has delegated such authority.
3. Fiscal Year. The fiscal year of the company shall date from the
first day of January in each year.
ARTICLE VI - Books and Records; Record Date
1. Books and Records. The books, accounts and records of the company,
except as may be otherwise required by the laws of Quebec (including with
respect to the book of the company, which shall be kept at the head office of
the company), may be kept within or outside of Quebec at such places as the
Board of Directors may from time to time designate.
2. Record Date. The Board of Directors is authorized to fix in advance
a date, not exceeding sixty (60) days preceding the date of any meeting of
shareholders, or the date for the payment of any dividend, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
shares shall go into effect, or a date in connection with obtaining consent, as
a record date for the determination of the shareholders entitled to notice of,
and to vote at, any such meeting and any adjournment thereof, or entitled to
receive payment of any such dividend or to any such allotment of rights, or to
exercise the rights in respect of any such change, conversion or exchange of
capital shares, or to give such consent. In such case such shareholders and
only such shareholders as shall be shareholders of record on the date so fixed
shall be entitled to such notice of, and to vote at, such meeting and any
adjournment thereof, or to receive payment of 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 shares on the register of
transfers of the company after any such record date fixed as aforesaid. Any
such record date fixed in connection with a meeting of shareholders shall not
be less than ten (10) days before the date of such meeting.
ARTICLE VII - Notices
1. Notices. Whenever any provision of law or the By-Laws of the company
requires notice to be given to any director, officer or shareholder, such
notice may be given in writing by mailing the same to such director, officer or
shareholder at his or her address as the same appears in the books of the
company, unless such shareholder shall have filed with the Secretary a written
request that notices intended for him or her be mailed to some other address,
in which case it shall be mailed to the address designated in such request.
The time when the same shall be mailed shall be deemed to be the time of the
giving of such notice. However, any notice given by the company to
shareholders, other than notices of annual or special meetings, shall be by
registered or certified letter. Such notice by registered or certified letter
shall be deemed given at the time such letter would be delivered in the
ordinary course of post. This section shall not be deemed to preclude the
giving of notice by other means if permitted by law, by the articles of the
company, or by the By-Laws of the company.
2. Waivers of Notice. A waiver of any notice in writing, signed by a
shareholder, director or officer, whether before or after the time stated in
said waiver for holding a meeting, shall be deemed equivalent to a notice
required to be given to any director, officer or shareholder.
ARTICLE VIII - Contracts
1. Interested Directors or Officers. No contract or transaction between
the company and one or more of its directors or officers, or between the
company and any other company, partnership, association, or other organization
in which one or more of the directors or officers of the company are directors
or officers, or have a financial interest, shall be void or voidable solely for
this reason, or solely because the director or officer of the company is
present at or participates in the meeting of the Board of Directors or the
Executive Committee thereof which authorizes the contract or transaction, or
solely because his, her or their votes are counted for such purpose, if:
(i) The material facts as to the relationship or interest of such
person and as to the contract or transaction are disclosed or are known to
the Board of Directors or the Executive Committee thereof, and the Board
of Directors or Executive Committee in good faith authorizes the contract
or transaction by a vote sufficient for such purpose without counting the
vote of the interested director or directors of the company; provided,
however, that common or interested directors may be counted in determining
the presence of a quorum at a meeting of the Board of Directors or
Executive Committee; or
(ii) The material facts as to the relationship or interest of such
person and as to the contract or transaction are disclosed or are known to
the shareholders of the company entitled to vote thereon, and the contract
or transaction is specifically approved in good faith by vote of the
shareholders of the company; or
(iii) The contract or transaction is fair as to the company as of the
time it is authorized, approved or ratified, by the Board of Directors,
the Executive Committee thereof, or the shareholders of the company.
ARTICLE IX - Seal
1. Seal. The corporate seal of the company shall be circular in form
and bear the name of the company and the year of its incorporation.
ARTICLE X - Indemnification
1. Indemnification in Third Party Action. Unless and except to the
extent prohibited by law, the company shall assume the defense of each person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
company) by reason of the fact that such person is or was a director, officer,
employee or agent of the company, or is or was serving at the request of the
company as a director, officer, employee or agent of another company,
partnership, joint venture, trust or other enterprise, and shall indemnify each
such person against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding unless such person has
committed a grievous offense or personal offense separable from the exercise of
his or her duties. With respect to any penal or criminal action or proceeding,
the company shall likewise indemnify each such person if he or she had reason
to believe his or her conduct was lawful or if they have been freed or
acquitted. The termination of any action or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not have
reasonable cause to believe that his or her conduct was unlawful.
2. Indemnification in an Action by or in the Right of the Company. The
company shall indemnify each person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or suit by or in
the right of the company to procure a judgment in its favor by reason of the
fact that such person is or was a director, officer, employee or agent of the
company, or is or was serving at the request of the company as a director,
officer, employee or agent of another company, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection with the defense
or settlement of such action or suit if the company loses its case and the
court so decides. If the company wins its case only in part, the court may
determine the amount of the expense the company shall assume.
3. Determination of Indemnification. Any indemnification under Sections
1 and 2 of this Article X (unless ordered by a court) shall be made by the
company only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper in the
circumstances because the person has met or failed to meet, as the case may be,
the applicable standard of conduct set forth in such Sections 1 and 2. Such
determination shall be made (a) by the Board of Directors by a majority vote of
a quorum consisting of directors who were not parties to such action, suit or
proceeding, or (b) if such a quorum is not obtainable, or, even if obtainable a
quorum of disinterested directors so directs, by independent legal counsel in a
written opinion, or (c) by the shareholders.
4. Advance for Expenses. Expenses incurred in defending a civil or
criminal action, suit or proceeding may be paid by the company in advance of
the final disposition of such action, suit or proceeding as authorized by the
Board of Directors in the specific case upon receipt of an undertaking by or on
behalf of the director, officer, employee or agent to repay such amount unless
it shall ultimately be determined that he or she is entitled to be indemnified
by the company as authorized in this Article X.
5. General Provisions.
(a) Any payment of indemnification made pursuant to this Article X
shall be reported to the shareholders, except that no such payment need be
reported if the person to whom it was made has been fully successful on the
merits or otherwise.
(b) All expenses incurred in defending a civil or criminal action or
proceeding which are advanced by the company under Section 4 of this Article X
shall be repaid (i) in case the person receiving such advance is ultimately
found, under the procedure set forth in this Article X, not to be entitled to
indemnification, or (ii) where indemnification is granted, to the extent that
the expenses so advanced by the company exceed the indemnification to which
such person is entitled.
(c) The company may indemnify each person, though he or she is not
or was not a director, officer, employee or agent of the corporation, who
served at the request of the company on a committee created by the Board to
consider and report to it in respect of any matter. Any such indemnification
may be made under the preceding provisions of this Article X and shall be
subject to the limitations thereof except that (as indicated) any such
committee member need not be nor have been a director, officer, employee or
agent of the company.
(d) If any section, subsection, paragraph, sentence, clause, phrase
or word in this Article X shall be adjudicated invalid or unenforceable, such
adjudication shall not be deemed to invalidate or otherwise affect any other
section, subsection, paragraph, sentence, clause, phrase or word of this
Article.
(e) The indemnification provided by this Article X shall not be
deemed exclusive of any other rights to which those indemnified may be entitled
under any By-Law, agreement, vote of shareholders or disinterested directors or
otherwise, both as to action in their official capacities and as to action in
another capacity while holding such office, and shall continue as to a person
who has ceased to be a director, officer, employee or agent and shall inure to
the benefit of the heirs, executors, and administrators of such a person.
ARTICLE XI - Borrowing of Money by the Company
1. Borrowing. The Board of Directors of the company may from time to
time:
(a) borrow money upon the credit of the company;
(b) issue debentures or other securities of the company, and pledge
or sell the same for such sums and at such prices as may be deemed
expedient;
(c) notwithstanding the provisions of the Civil Code, hypothecate,
mortgage or pledge the moveable or immoveable property, present or future,
of the company, to secure any such debentures or other securities, or give
part only of such guarantee for such purposes and constitute the hypothec,
mortgage or pledge above mentioned, by trust deed, in accordance with
Sections 28 and 29 of the Special Corporate Powers Act (Chap. P-16), or in
any other manner; and
(d) hypothecate or mortgage the immoveable property of the company,
or pledge or otherwise affect the moveable property, or give all such
guarantees, to secure the payment of loans made otherwise than by the
issue of debentures, as well as the payment or performance of any other
debt, contract or obligation of the company.
The limitations and restrictions contained in this section shall not
apply to the borrowing of money by the company on bills of exchange or
promissory notes made, drawn, accepted or endorsed by or on behalf of the
company.
2. Delegation. The Board of Directors may from time to time delegate to
such one or more of the directors and officers of the company as may be
designated by the Board of Directors all or any of the powers conferred on the
Board of Directors by Article XI, Section 1 hereof or by the laws of Quebec to
such extent and in such manner as the Board of Directors shall determine at the
time of each such delegation. The powers hereby confirmed by this paragraph
and the preceding paragraph shall be deemed to be in supplement to and not in
substitution for any other borrowing powers which may otherwise be conferred on
the directors or officers of the company independently of such paragraphs.
ARTICLE XII - Executive Committee
1. Number; Term of Office; Increase or Decrease; Removal; Vacancies;
Resignation. So long as the board of directors shall consist of more than six
directors, the Board of Directors may designate and elect from among its
members an Executive Committee. The Executive Committee shall be composed of
three directors, unless and until the Board of Directors shall fix a different
number of members; provided, that the Executive Committee may not be composed
of less than three directors. Each member of the Executive Committee shall
continue to be a member thereof so long as he shall continue to be a member of
the Board of Directors or until his successor is designated and elected,
unless, prior to his ceasing to be a director or his successor being designated
and elected, he shall be removed from the Executive Committee by the Board of
Directors or he shall resign from the Executive Committee. A majority of the
Board of Directors then in office, even though less than a quorum, may at any
time (i) increase or decrease (to not less than three) the number of members of
the Executive Committee, (ii) remove (with or without cause) members of the
Executive Committee, and (iii) designate and elect new members of the Executive
Committee to replace existing members thereof or to fill vacancies therein,
whether caused by death, increase in the number of members, resignation,
removal or otherwise. Any member of the Executive Committee may at any time
resign therefrom by giving written notice thereof to the Board of Directors,
the Chairman of the Board, or the Secretary, and any such resignation shall
take effect at the time specified therein, or if a time is not specified
therein, then upon receipt thereof.
2. Powers. Subject to the provisions of paragraph 5 of this Article
XII, during intervals between meetings of the Board of Directors, the Executive
Committee shall have, and may exercise, any and all powers of the Board of
Directors, except those powers which by law, by the Articles of the Company, or
by any By-Laws of the Company hereafter enacted by the Board of Directors must
be exercised only by the Board of Directors.
3. Meetings; Notice; Waiver of Notice. Meetings of the Executive
Committee may be called by the Chairman of the Board, any Vice Chairman of the
Board, the President, or, upon written request of any member, by the Secretary.
Notice of a meeting of the Executive Committee shall be given to each member at
least two days before the day on which the meeting is to be held by personal
delivery, mail, telegram, radio, cable or other means. The notice shall state
the time and place of the meeting and the purpose or purposes for which the
meeting has been called. A written waiver of notice signed by a member of the
Executive Committee, whether signed before or after a meeting, shall be deemed
to satisfy any requirement to give notice of the meeting to such member.
4. Quorum; Adjourned Meetings; Required Vote; Consent in Writing;
Participation by Conference Phone. A majority of the Executive Committee as
then constituted, but in no event less than two members thereof, shall be
necessary and sufficient at all meetings to constitute a quorum for the
transaction of business. In the absence of a quorum, a majority of the members
present may adjourn the meeting from time to time and the meeting may be held
as adjourned without further notice provided that a majority of the Executive
Committee as then constituted, but in no event less than two members thereof,
are present at such adjourned meeting. Unless otherwise specifically required
by law, by the Articles of the Company, or by any By-Laws of the Company
hereafter enacted by the Board of Directors, the act of a majority of the
members of the Executive Committee present at any properly convened meeting at
which there is a quorum shall be the act of the Executive Committee. Any
action permitted to be taken at any meeting of the Executive Committee may be
taken without a meeting if all members thereof entitled to vote at a meeting
sign a resolution in writing setting forth the actions so taken, and the
writing or writings are filed with the minutes of proceedings of the Executive
Committee. If all members of the Executive Committee consent, members thereof
may participate in a meeting thereof by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and participation in a meeting by such means
shall constitute presence in person at the meeting.
5. Validation. All acts done at any meeting of the Executive Committee
by any person or persons acting as a member or members thereof shall,
notwithstanding that it may subsequently be discovered that there was a defect
in the appointment of any such person or persons as a member or members
thereof, or that any such person or persons were disqualified as members
thereof, be valid as if every such person or persons had been duly designated
and elected as members of the Executive Committee. Actions by the Executive
Committee need not be approved by the Board of Directors to be valid; however,
any action by the Executive Committee shall be subject to rescission or
alteration by the Board of Directors; provided, that no rights or actions of or
with respect to third parties shall be prejudiced or affected by any such
rescission or alteration.
ARTICLE XIII - Head Office
The company shall maintain a head office in Quebec in the judicial
district indicated in its articles. The company may change the address of its
head office within the limits of such judicial district by a resolution of its
Board of Directors. It may also transfer its head office to another judicial
district by amending its articles and such transfer shall have effect as of the
date of the amendment to the articles.
ARTICLE XIV - Amendments to the By-Laws
The Board of Directors may from time to time repeal, amend, or re-enact
By-Laws of the company, but every such By-law, (except By-Laws respecting
agents, officers and servants of the company, and except such By-Laws which by
law require approval or sanction by the shareholders before coming into effect)
and every repeal, amendment or re-enactment thereof, unless in the meantime
confirmed at a meeting of the shareholders of the company duly called for that
purpose, shall have force only until the next annual meeting of shareholders of
the company, and in default of confirmation thereat, shall, at and from that
time only, cease to be in force.
SPECIAL BY-LAWS
SPECIAL BY-LAW NO. 1 (originally adopted as By-Law No. 1 at a meeting of the
Directors held on September 17, 1982)
That:
1. The Company be, and it hereby is, authorized to make an application
to the Ministre des Consommateurs, Cooperatives et Institutions
Financieres de la Province de Quebec for a Certificate of Continuance
continuing the Company under Part 1A of the Companies Act, Quebec.
2. Subject to the issuance of such Certificate of Continuance and
without affecting the validity of the incorporation and existence of
the Company by and under its Charter, and of any act done thereunder,
its Charter is hereby amended by deleting all of the provisions
thereof and substituting therefor all provisions set out in the
Articles of Continuance, a copy of which has been presented at this
meeting and is to be included in the Minutes of this Meeting; and
that the Chairman of the Board, the Vice Chairman of the Board and
the President of the Company be, and each of them hereby is,
authorized to execute and deliver such documents and instruments
(including, without limitation, the Articles of Continuance of the
Company), and to take and cause to be taken such additional actions,
as he deems necessary or desirable to effect the foregoing.
SPECIAL BY-LAW NO. 2 (originally adopted as By-Law No. 7 by consent of the
Executive Committee of the Board of Directors dated July 18, 1986)
1. THAT the articles of amendment attached hereto, providing for
increasing the maximum number of directors from twelve to thirteen
which the board of directors may determine, is hereby approved;
2. THAT the Company file the articles of amendment with the Inspecteur
general des institutions financieres in order to obtain a certificate
of amendment, and that any one of the directors of the Company is
hereby authorized to file the said articles of amendment for and on
behalf of and in the name of the Company;
3. THAT upon the issuance of the certificate of amendment and without
affecting the validity and the existence of the Company by virtue of
its certificate of continuance, the articles of continuance are
hereby amended by amending section 6 of the articles of continuance
in accordance with the provisions of the articles of amendment
attached hereto;
4. THAT any one of the directors of the Company is hereby authorized to
sign all documents and forms necessary or incidental for the due
carrying out of the foregoing; and
5. THAT upon the issuance of the certificate of amendment, the Board of
Directors of the Company shall consist of thirteen persons.
SPECIAL BY-LAW NO. 3 (originally adopted as By-Law No. 9 by consent of the
Directors dated February 19, 1988)
1. THAT the articles of amendment presented at this meeting, amending
the share capital to authorize an unlimited number of shares of Class
D Preferred Stock, are hereby approved;
2. THAT the Company file articles of amendment with the Inspecteur
general des institutions financieres in order to obtain a certificate
of amendment amending its capital structure and that any one of the
Directors of the Company be and he is hereby authorized to file the
said articles of amendment for and on behalf of and in the name of
the Company;
3. THAT upon the issuance of the certificate of amendment and without
affecting the validity and the existence of the Company by virtue of
its certificate of continuance, the articles of continuance be and
they are hereby amended by amending Section 4 of the articles of
continuance in accordance with the provisions of the articles of
amendment approved by the Board of Directors of the Company; and
4. THAT any one of the Directors of the Company be and he is hereby
authorized to sign all documents and forms necessary or incidental
for the due carrying out of the foregoing.
SPECIAL BY-LAW NO. 4 (originally adopted as By-Law No. 10 by consent of the
Executive Committee of the Board of Directors dated February 15, 1993)
1. THAT the articles of amendment attached hereto amending Section 5 of
the Company's articles of continuance to permit the Company to offer
its securities to the public are hereby approved;
2. THAT the Company file articles of amendment with the Inspecteur
general des institutions financieres in order to obtain a certificate
of amendment amending the limitations on the public offering of the
Company's securities set forth in Section 5 of the Company's articles
of continuance and that any one of the Directors of the Company be
and he is hereby authorized to execute and file the said articles of
amendment for and on behalf of and in the name of the Company;
3. THAT upon the issuance of the certificate of amendment and without
affecting the validity and the existence of the Company by virtue of
its certificate of continuance, the articles of continuance be and
they are hereby amended by amending Section 5 of the articles of
continuance in accordance with the provisions of the articles of
amendment approved by the Executive Committee of the Board of
Directors of the Company; and
4. THAT any one of the Directors of the Company be and he is hereby
authorized to do all things and sign all documents and forms
necessary or incidental for the due carrying out of the foregoing.
SPECIAL BY-LAW NO. 5
being a by-law authorizing the Company to file articles of amendment with
the Inspecteur general des institutions financieres, in order to obtain a
certificate of amendment changing the corporate name of the Company:
1. THAT the Company file articles of amendment with the Inspecteur
general des institutions financieres, in order to obtain a
certificate of amendment changing its corporate name from "Societe
Canadienne de Metaux Reynolds, Limitee-Canadian Reynolds Metals
Company, Limited" to "Societe d'Aluminium Reynolds du Canada,
Ltee/Reynolds Aluminum Company of Canada, Ltd." effective January 1,
1996; and
2. THAT any one of the directors of the Company be and he/she is hereby
authorized to do all things and sign all documents and forms
necessary or incidental for the due carrying out of the foregoing.
SPECIAL BY-LAW NO. 6
THAT the Company is hereby authorized to enter into and carry out a Plan
of Reorganization (the "Plan of Reorganization") among the Company,
Southern Graphic Systems, Inc. ("SGS") and Systemes Graphiques
Southern-Canada, Ltee-Southern Graphic Systems-Canada, Ltd. ("SGSC").
THAT each of the officers of the Company is hereby authorized to execute
and deliver on behalf of the Company the Plan of Reorganization in the
form or substantially the form attached hereto, with such changes therein
as the executing officer shall deem necessary or advisable.
THAT each of the officers of the Company is hereby authorized to sign any
and all certificates, agreements, instruments and documents required under
Canadian federal or Quebec law relating to an election under Section 85 of
the Canadian Income Tax Act.
THAT each officer of the Company is hereby authorized to cause the Company
to acquire from SGS (i) 100 class A common shares without par value of
SGSC and (ii) 4,288 class A preferred shares without par value of SGSC
(together, being all of the outstanding shares of SGSC, the "SGSC
Shares"), solely in consideration of and exchange for 45,000 Class A
Preferred Shares, Cdn. $100 Par Value, of the Company (the "Class A
Preferred Shares").
THAT the Board of Directors hereby determines that the SGSC Shares to be
acquired by the Company have a fair market value, and are the fair
equivalent of cash in the amount, of Cdn. $4,500,000.
THAT the Company issue, allot and deliver to SGS the Class A Preferred
Shares for the consideration established above.
THAT the Class A Preferred Shares when issued, allotted and delivered to
SGS for the consideration described above shall be, and shall be deemed to
be, fully paid and nonassessable, and the holders of the Class A Preferred
Shares shall be subject to no further call or liability with respect
thereto.
THAT in the event the fair market value of the SGSC Shares to be acquired
by the Company pursuant to this resolution shall be determined by final
judgment of any competent administrative tribunal or court, or by
uncontested decision of any revenue authority, to be other than Cdn.
$4,500,000 as of the date such SGSC Shares are exchanged for the Class A
Preferred Shares, each officer of the Company is hereby authorized to
execute and deliver such documents and instruments, and to take and cause
to be taken such additional action, as any such officer deems necessary or
desirable to adjust retroactively the stated capital of the Class A
Preferred Shares to reflect the valuation so determined, and to make or
cause to be made all necessary adjustments, payments or repayments,
cancellation or issuance of shares as may be required in order to give
effect to such changes as of the date of issuance of the Class A Preferred
Shares.
THAT each of the officers of the Company is hereby authorized to take any
and all such other actions, including without limitation the incurrence
and payment of all fees, expenses and other charges, and to execute and
deliver any and all agreements, instruments and documents which in the
opinion of any of them may be necessary or desirable to achieve the
purposes of, or effect the transactions contemplated by, this resolution,
the taking of any such action or the execution and delivery of any such
agreements, instruments or documents to be conclusive evidence of the
authority to take, execute and deliver the same"; and
FURTHER RESOLVED, that the amount of $4,500,000 be added to the paid-up
share capital account being maintained by the Company for its Class A
Preferred Shares.
EXHIBIT 4.15
Quebec
CERTIFICAT DE MODIFICATION
Loi sur les compagnies, Partie IA
(L.R.Q., chap. C-38)
J'atteste par les presentes que la compagnie
SOCIETE CANADIENNE DE METAUX
REYNOLDS, LTEE
et sa version
CANADIAN REYNOLDS METALS COMPANY, LTD.
a modifie ses statuts le 1ER JANVIER 1996, sous l'autorite de la
partie IA de la Loi sur les compagnies, tel qu'indique dans les
statuts de modification ci-joints.
Deposes au registre le 15 decembre 1995
sous le matricule 1140329104
Gouvernement
du Quebec
L'Inspecteur
general des Alfred Vaillancourt
institutions Inspecteur general des institutions financieres par interim
financieres
[IMAGE OF SEAL OMITTED]
APPENDIX 2
(1) The number of its shareholders is limited to fifty (50), exclusive of
present or former employees of the Company or of a subsidiary.
(2) The directors may, when they deem it expedient:
(a) borrow money upon the credit of the Company;
(b) issue debentures or other securities of the Company, and pledge or
sell the same for such sums and at such prices as may be deemed
expedient;
(c) hypothecate the immovable and movable property or otherwise affect
the movable property of the Company.
<PAGE>
Quebec
CERTIFICAT DE CONSTITUTION
Loi sur les compagnies, Partie IA
(L.R.Q., chap. C-38)
J'atteste par les presentes que la compagnie
SYSTEMES GRAPHIQUES SOUTHERN-CANADA,
LTEE
et sa version
SOUTHERN GRAPHIC SYSTEMS-CANADA, LTD.
a ete constituee le 31 MARS 1994, sous l'autorite de la
partie IA de la Loi sur les compagnies, tel qu'indique dans les
statuts de constitution ci-joints.
Deposes au registre le 12 avril 1994
sous le matricule 1140329104
Gouvernement
du Quebec
L'Inspecteur
general des Jean Marie Blandchard
institutions Inspecteur general des institutions financieres
financieres
S110S14G01S93MA
[IMAGE OF SEAL OMITTED]
<PAGE>
Gouvernement du Quebec A-110220-J9401
L'Inspecteur general
des institutions financieres
Form 1
ARTICLES OF INCORPORATION
The Companies Act, R.S.Q., c. C-38
Part 1A
1 Corporate name
SYSTEMES GRAPHIQUES SOUTHERN-CANADA, LTEE
SOUTHERN GRAPHIC SYSTEMS-CANADA, LTD.
2 Quebec judicial district 3 Precise number or 4 Effective date if
wherein company is minimum and maximum after filing date
setting up its head number of directors
office
Montreal Minimum: 3 Maximum: 10 N/A
5 Description of share capital
The annexed Appendix 1 is incorporated in this form
6 Restrictions (if any) on transfer of shares
No shares of the Company shall be transferred without the approval of the
directors evidenced by a resolution duly adopted by them
7 Limitations (if any) on company activity
None
8 Other provisions
The annexed Appendix 2 is incorporated in this form
9 Incorporators
Name and surname Address and postal code Signature of each incorporator
(if a corporation, give (if a corporation, signature
head office address and of authorized person)
incorporation act)
Bertrand, Maryse 3123 Daulac Road Maryse Bertrand
Montreal, Quebec
H3Y 2A1
______________________________________________________________________________
If space is insufficient, attach an appendix in two (2) copies
- ------------------------------------------------------------------------------
For departmental use only CA-211(REV.12-93)
Gouvernement
du Quebec
Depose le
31 MARS 1994
L'Inspecteur general des
Institutions financieres
<PAGE>
APPENDIX 1
----------
Unlimited number of class A common shares without par value;
Unlimited number of class B common shares without par value;
Unlimited number of class A preferred shares without par value;
Unlimited number of class B preferred shares without par value;
Unlimited number of class C preferred shares without par value; and
Unlimited number of class D preferred shares without par value.
I. The class A common shares and the class B common shares shall have
attached thereto the following rights, privileges, restrictions and
conditions:
(a) Each class A common share shall entitle the holder thereof to one (1)
vote at all meetings of the shareholders of the Company (except
meetings at which only holders of another specified class of shares
are entitled to vote pursuant to the provisions hereof or pursuant to
the provisions of the Companies Act (hereinafter referred to as the
"Act")). The holders of the class B common shares shall not be
entitled to receive notice of, nor to attend or vote at meetings of
the shareholders of the Company (except as required by the provisions
hereof or by the Act).
(b) In the event of the liquidation, dissolution or winding-up of the
Company, whether voluntary or involuntary, or other distribution of
assets of the Company among shareholders for the purpose of
winding-up its affairs, subject to the rights, privileges,
restrictions and conditions attaching to the class A preferred
shares, the class B preferred shares, the class C preferred shares,
the class D preferred shares and to any other class of shares ranking
prior to the class A common shares or the class B common shares, the
holders of the class A common shares and the holders of the class B
common shares shall be entitled to receive the remaining property of
the Company; the class A common shares and the class B common shares
shall rank equally with respect to the payment of dividends and to
the distribution of assets in the event of the liquidation,
dissolution or winding-up of the Company, whether voluntary or
involuntary, or any other distribution of the assets of the Company
among shareholders for the purpose of winding-up its affairs.
II. The class A preferred shares shall have attached thereto the following
rights, privileges, restrictions and conditions:
(a) Each class A preferred share shall entitle the holder thereof to one
(1) vote at all meetings of the shareholders of the Company (except
meetings at which only holders of another specified class of shares
are entitled to vote pursuant to the provisions of the Act).
(b) The holders of the class A preferred shares shall be entitled to
receive during each month, as and when declared by the board of
directors, but always in preference and priority to any payment of
dividends on the other shares of the Company, non-cumulative
dividends at a fixed rate of one percent (1%) per month calculated on
the class A preferred redemption price (as hereinafter in paragraph
II. (g) defined) of each such share payable in money, property or by
the issue of fully paid shares of any class of the Company. The
holders of the class A preferred shares shall not be entitled to any
dividend in excess of the dividend hereinbefore provided for.
(c) In the event of the liquidation, dissolution or winding-up of the
Company, whether voluntary or involuntary, or other distribution of
assets of the Company among shareholders for the purpose of
winding-up its affairs, the holders of the class A preferred shares
shall be entitled to receive for each class A preferred share, in
preference and priority to any distribution of the property or assets
of the Company to the holders of the other shares of the Company, an
amount equal to the class A preferred redemption price plus all
declared and unpaid dividends thereon, but shall not be entitled to
share any further in the distribution of the property or assets of
the Company.
(d) The Company may, in the manner hereinafter provided, redeem at any
time all, or from time to time any part, of the outstanding class A
preferred shares on payment for each class A preferred share to be
redeemed of the class A preferred redemption price plus all declared
and unpaid dividends thereon (in paragraphs II. (e) and (f) called
the "redemption price").
(e) Before redeeming any class A preferred shares, the Company shall mail
or deliver to each person who, at the date of such mailing or
delivery, shall be a registered holder of class A preferred shares to
be redeemed, notice of the intention of the Company to redeem such
shares held by such registered holder; such notice shall be delivered
to, or mailed by ordinary prepaid post addressed to, the last address
of such holder as it appears on the records of the Company, or in the
event of the address of any such holder not appearing on the records
of the Company, then to the last address of such holder known to the
Company, at least one (1) day before the date specified for
redemption; such notice shall set out the redemption price, the date
on which the redemption is to take place and, if part only of the
class A preferred shares held by the person to whom it is addressed
is to be redeemed, the number thereof so to be redeemed; on or after
the date so specified for redemption the Company shall pay or cause
to be paid the redemption price to the registered holders of the
class A preferred shares to be redeemed on presentation and surrender
of the certificates for the class A preferred shares so called for
redemption at the registered office of the Company or at such other
place or places as may be specified in such notice, and the
certificates for such class A preferred shares shall thereupon be
cancelled, and the class A preferred shares represented thereby shall
thereupon be redeemed; from and after the date specified for
redemption in such notice, the holders of the class A preferred
shares called for redemption shall cease to be entitled to dividends
in respect of such shares and shall not be entitled to exercise any
of the rights of the holders thereof, except the right to receive the
redemption price, unless payment of the redemption price shall not be
made by the Company in accordance with the foregoing provisions, in
which case the rights of the holders of such shares shall remain
unaffected; on or before the date specified for redemption, the
Company shall have the right to deposit the redemption price of the
class A preferred shares called for redemption in a special account
with any chartered bank or trust company in Canada named in the
notice of redemption, to be paid, without interest, to or to the
order of the respective holders of such class A preferred shares
called for redemption, upon presentation and surrender of the
certificates representing the same and, upon such deposit being made
or upon the date specified for redemption, whichever is later, the
class A preferred shares in respect whereof such deposit shall have
been made, shall be deemed to be redeemed and the rights of the
respective holders thereof, after such deposit or after such
redemption date, as the case may be, shall be limited to receiving,
out of the moneys so deposited, without interest, the redemption
price applicable to their respective class A preferred shares against
presentation and surrender of the certificates representing such
class A preferred shares. If less than all the class A preferred
shares are to be redeemed, the shares to be redeemed shall be
redeemed pro rata, disregarding fractions, unless the holders of the
class A preferred shares unanimously agree to the adoption of
another method of selection of the class A preferred shares to be
redeemed. If less than all the class A preferred shares represented
by any certificate be redeemed, a new certificate for the balance
shall be issued.
(f) The Company may purchase for cancellation at any time all, or from
time to time any part, of the class A preferred shares outstanding,
by private contract at any price, with the unanimous consent of the
holders of the class A preferred shares then outstanding, or by
invitation for tenders addressed to all the holders of the class A
preferred shares at the lowest price at which, in the opinion of the
directors, such shares are obtainable but not exceeding the
redemption price thereof. If less than all the class A preferred
shares represented by any certificate be purchased for cancellation,
a new certificate for the balance shall be issued.
(g) For the purposes of the foregoing paragraphs II. (b), (c) and (d),
the "class A preferred redemption price" of each class A preferred
share shall be an amount equal to (i) the monetary consideration
received by the Company upon the issuance of such share (denominated
in the currency in which such consideration was paid to the Company),
if such share has been issued for money; or (ii) the fair market
value of the consideration received by the Company (including,
without limitation, shares of another class of the Company) upon the
issuance of such share, if such share has been issued for a
consideration other than money. Subject to the provisions of the
following sub-paragraph, such fair market value is to be determined
by the directors on the basis of generally accepted accounting and
valuation principles.
The fair market value determined as hereinabove provided for shall be
subject to revision in accordance with any binding agreement with, or
decision by, the appropriate taxation authorities, or any judgment of
a court of competent jurisdiction. In the event that any such
agreement, decision or judgment shall result in a final determination
under the provisions of the appropriate taxation legislation and the
amount thereby determined is an amount other than the amount for
which such share was originally issued as determined by the directors
in accordance with the preceding sub-paragraph, such finally
determined amount for the purpose of the appropriate taxation
legislation shall then be deemed to be the fair market value of the
consideration received by the Company upon the issuance of such class
A preferred share.
(h) In the event that only part of the amount of the consideration
received by the Company for any class A preferred share issued by the
Company is added to the issued and paid up capital account for the
class of shares of which such class A preferred share forms part,
such class A preferred share shall be deemed to have been issued for
the full amount of the consideration received, for all purposes of
these articles (except only the issued and paid up capital of such
shares) including, but without limiting the generality of the
foregoing, dividend rights, redemption rights and rights upon
liquidation and dissolution.
(i) No change to any of the provisions of paragraphs II. (a) to (h) or of
this paragraph (i) shall have any force or effect until it has been
approved by a majority of not less than two-thirds (2/3) of the votes
cast by the holders of the class A preferred shares, voting
separately as a class at a meeting of such holders specially called
for that purpose, or by a resolution in writing signed by all the
holders of the class A preferred shares, in addition to any other
approval required by the Act.
III. The class B preferred shares shall have attached thereto the following
rights, privileges, restrictions and conditions:
(a) Subject to the provisions of the Act or as otherwise expressly
provided herein, the holders of the class B preferred shares shall
not be entitled to receive notice of, nor to attend or vote at
meetings of the shareholders of the Company.
(b) The holders of the class B preferred shares shall be entitled to
receive during each month, as and when declared by the board of
directors, but always in preference and priority to any payment of
dividends on the class C preferred shares, the class D preferred
shares, the class A common shares and the class B common shares or
any other shares ranking junior to the class B preferred shares,
non-cumulative dividends at a fixed rate of one percent (1%) per
month calculated on the class B preferred redemption price (as
hereinafter in paragraph III. (g) defined) of each such share
payable in money, property or by the issue of fully paid shares of
any class of the Company. The holders of the class B preferred
shares shall not be entitled to any dividend in excess of the
dividend hereinbefore provided for.
(c) In the event of the liquidation, dissolution or winding-up of the
Company, whether voluntary or involuntary, or other distribution of
assets of the Company among shareholders for the purpose of
winding-up its affairs, the holders of the class B preferred shares
shall be entitled to receive for each class B preferred share, in
preference and priority to any distribution of the property or
assets of the Company to the holders of the class C preferred
shares, the class D preferred shares, the class A and the class B
common shares or any other shares ranking junior to the class B
preferred shares, an amount equal to the class B preferred
redemption price plus all declared and unpaid dividends thereon, but
shall not be entitled to share any further in the distribution of
the property or assets of the Company.
(d) The Company may, in the manner hereinafter provided, redeem at any
time all, or from time to time any part, of the outstanding class B
preferred shares on payment for each class B preferred share to be
redeemed of the class B preferred redemption price plus all declared
and unpaid dividends thereon (in paragraphs III. (e) and (f) called
the "redemption price").
(e) Before redeeming any class B preferred shares, the Company shall
mail or deliver to each person who, at the date of such mailing or
delivery, shall be a registered holder of class B preferred shares
to be redeemed, notice of the intention of the Company to redeem
such shares held by such registered holder; such notice shall be
delivered to, or mailed by ordinary prepaid post addressed to, the
last address of such holder as it appears on the records of the
Company, or in the event of the address of any such holder not
appearing on the records of the Company, then to the last address of
such holder known to the Company, at least one (1) day before the
date specified for redemption; such notice shall set out the
redemption price, the date on which the redemption is to take place
and, if part only of the class B preferred shares held by the person
to whom it is addressed is to be redeemed, the number thereof so to
be redeemed; on or after the date so specified for redemption the
Company shall pay or cause to be paid the redemption price to the
registered holders of the class B preferred shares to be redeemed on
presentation and surrender of the certificates for the class B
preferred shares so called for redemption at the head office of the
Company or at such other place or places as may be specified in such
notice, and the certificates for such class B preferred shares shall
thereupon be cancelled, and the class B preferred shares represented
thereby shall thereupon be redeemed; from and after the date
specified for redemption in such notice, the holders of the class B
preferred shares called for redemption shall cease to be entitled to
dividends in respect of such shares and shall not be entitled to
exercise any of the rights of the holders thereof, except the right
to receive the redemption price, unless payment of the redemption
price shall not be made by the Company in accordance with the
foregoing provisions, in which case the rights of the holders of
such shares shall remain unaffected; on or before the date
specified for redemption, the Company shall have the right to
deposit the redemption price of the class B preferred shares called
for redemption in a special account with any chartered bank or trust
company in Canada named in the notice of redemption, to be paid,
without interest, to or to the order of the respective holders of
such class B preferred shares called for redemption, upon
presentation and surrender of the certificates representing the same
and, upon such deposit being made or upon the date specified for
redemption, whichever is later, the class B preferred shares in
respect whereof such deposit shall have been made, shall be deemed
to be redeemed and the rights of the respective holders hereof,
after such deposit or after such redemption date, as the case may
be, shall be limited to receiving, out of the moneys so deposited,
without interest, the redemption price applicable to their
respective class B preferred shares against presentation and
surrender of the certificates representing such class B preferred
shares. If less than all the class B preferred shares are to be
redeemed, the shares to be redeemed shall be redeemed pro rata,
disregarding fractions, unless the holders of the class B preferred
shares unanimously agree to the adoption of another method of
selection of the class B preferred shares to be redeemed. If less
than all the class B preferred shares represented by any certificate
be redeemed, a new certificate for the balance shall be issued.
(f) The Company may purchase for cancellation at any time all, or from
time to time any part, of the class B preferred shares outstanding,
by private contract at any price, with the unanimous consent of the
holders of the class B preferred shares then outstanding, or by
invitation for tenders addressed to all the holders of the class B
preferred shares at the lowest price at which, in the opinion of the
directors, such shares are obtainable but not exceeding the
redemption price thereof. If less than all the class B preferred
shares represented by any certificate be purchased for cancellation,
a new certificate for the balance shall be issued.
(g) For the purposes of the foregoing paragraphs III. (b), (c) and (d),
the "class B preferred redemption price" of each class B preferred
share shall be an amount equal to (i) the monetary consideration
received by the Company upon the issuance of such share (denominated
in the currency in which such consideration was paid to the
Company), if such share has been issued for money; or (ii) the fair
market value of the consideration received by the Company
(including, without limitation, shares of another class of the
Company) upon the issuance of such share, if such share has been
issued for a consideration other than money. Subject to the
provisions of the following sub-paragraph, such fair market value is
to be determined by the directors on the basis of generally accepted
accounting and valuation principles.
The fair market value determined as hereinabove provided for shall
be subject to revision in accordance with any binding agreement
with, or decision by, the appropriate taxation authorities, or any
judgment of a court of competent jurisdiction. In the event that
any such agreement, decision or judgment shall result in a final
determination under the provisions of the appropriate taxation
legislation and the amount thereby determined is an amount other
than the amount for which such share was originally issued as
determined by the directors in accordance with the preceding
subparagraph, such finally determined amount for the purpose of the
appropriate taxation legislation shall then be deemed to be the fair
market value of the consideration received by the Company upon the
issuance of such class B preferred share.
(h) In the event that only part of the amount of the consideration
received by the Company for any class B preferred share issued by
the Company is added to the issued and paid up capital account for
the class of shares of which such class B preferred share forms
part, such class B preferred share shall be deemed to have been
issued for the full amount of the consideration received, for all
purposes of these articles (except only the issued and paid up
capital of such shares) including, but without limiting the
generality of the foregoing, dividend rights, redemption rights and
rights upon liquidation and dissolution.
(i) No change to any of the provisions of paragraphs III. (a) to (h) or
of this paragraph (i) shall have any force or effect until a by-law
has been approved by a majority of not less than two-thirds (2/3) of
the votes cast by the holders of the class B preferred shares,
voting separately as a class at a meeting of such holders specially
called for that purpose, or by a resolution in writing signed by all
the holders of the class B preferred shares, in addition to any
other approval required by the Act.
IV. The class C preferred shares shall have attached thereto the following
rights, privileges, restrictions and conditions:
(a) Each class C preferred share shall entitle the holder thereof to one
(1) vote at all meetings of the shareholders of the Company (except
meetings at which only holders of another specified class of shares
are entitled to vote pursuant to the provisions hereof or pursuant
to the Act).
(b) The holders of the class C preferred shares shall be entitled to
receive during each month, as and when declared by the board of
directors, but always in preference and priority to any payment of
dividends on the class D preferred shares, the class A and the class
B common shares or any other shares ranking junior to the class C
preferred shares, non-cumulative dividends at a fixed rate of one
percent (1%) per month calculated on the class C preferred
redemption price (as hereinafter in paragraph IV. (h) defined) of
each such share payable in money, property or by the issue of fully
paid shares of any class of the Company. The holders of the class C
preferred shares shall not be entitled to any dividend in excess of
the dividend hereinbefore provided for.
(c) In the event of the liquidation, dissolution or winding-up of the
Company, whether voluntary or involuntary, or other distribution of
assets of the Company among shareholders for the purpose of
winding-up its affairs, the holders of the class C preferred shares
shall be entitled to receive for each class C preferred share, in
preference and priority to any distribution of the property or
assets of the Company to the holders of the class D preferred
shares, the class A and the class B common shares or any other
shares ranking junior to the class C preferred shares, an amount
equal to the class C preferred redemption price plus all declared
and unpaid dividends thereon, but shall not be entitled to share any
further in the distribution of the property or assets of the
Company.
(d) The Company may, in the manner hereinafter provided, redeem at any
time all, or from time to time any part, of the outstanding class C
preferred shares on payment for each class C preferred share to be
redeemed of the class C preferred redemption price plus all declared
and unpaid dividends thereon (in paragraphs IV. (e), (f) and (g)
called the "redemption price").
(e) Before redeeming any class C preferred shares, the Company shall
mail or deliver to each person who, at the date of such mailing or
delivery, shall be a registered holder of class C preferred shares
to be redeemed, notice of the intention of the Company to redeem
such shares held by such registered holder; such notice shall be
delivered to, or mailed by ordinary prepaid post addressed to, the
last address of such holder as it appears on the records of the
Company, or in the event of the address of any such holder not
appearing on the records of the Company, then to the last address of
such holder known to the Company, at least one (1) day before the
date specified for redemption; such notice shall set out the
redemption price, the date on which the redemption is to take place
and, if part only of the class C preferred shares held by the person
to whom it is addressed is to be redeemed, the number thereof so to
be redeemed; on or after the date so specified for redemption the
Company shall pay or cause to be paid the redemption price to the
registered holders of the class C preferred shares to be redeemed on
presentation and surrender of the certificates for the class C
preferred shares so called for redemption at the head office of the
Company or at such other place or places as may be specified in such
notice, and the certificates for such class C preferred shares shall
thereupon be cancelled, and the class C preferred shares represented
thereby shall thereupon be redeemed; from and after the date
specified for redemption in such notice, the holders of the class C
preferred shares called for redemption shall cease to be entitled to
dividends in respect of such shares and shall not be entitled to
exercise any of the rights of the holders thereof, except the right
to receive the redemption price, unless payment of the redemption
price shall not be made by the Company in accordance with the
foregoing provisions, in which case the rights of the holders of
such shares shall remain unaffected; on or before the date specified
for redemption, the Company shall have the right to deposit the
redemption price of the class C preferred shares called for
redemption in a special account with any chartered bank or trust
company in Canada named in the notice of redemption, to be paid,
without interest, to or to the order of the respective holders of
such class C preferred shares called for redemption, upon
presentation and surrender of the certificates representing the same
and, upon such deposit being made or upon the date specified for
redemption, whichever is later, the class C preferred shares in
respect whereof such deposit shall have been made, shall be deemed
to be redeemed and the rights of the respective holders thereof,
after such deposit or after such redemption date, as the case may
be, shall be limited to receiving, out of the moneys so deposited,
without interest, the redemption price applicable to their
respective class C preferred shares against presentation and
surrender of the certificates representing such class C preferred
shares. If less than all the class C preferred shares are to be
redeemed, the shares to be redeemed shall be redeemed pro rata,
disregarding fractions, unless the holders of the class C preferred
shares unanimously agree to the adoption of another method of
selection of the class C preferred shares to be redeemed. If less
than all the class C preferred shares represented by any certificate
be redeemed, a new certificate for the balance shall be issued.
(f) A holder of class C preferred shares shall be entitled to require
the Company to redeem at any time all, or from time to time any
part, of the class C preferred shares registered in the name of such
holder by tendering to the Company at its head office the share
certificate(s) representing the class C preferred shares which the
registered holder desires to have the Company redeem together with a
request in writing specifying (i) the number of class C preferred
shares which the registered holder desires to have redeemed by the
Company and (ii) the business day (in this paragraph referred to as
the "redemption date") on which the holder desires to have the
Company redeem such class C preferred shares, which redemption date
shall not be less than five (5) days after the day on which the
request in writing is given to the Company. Upon receipt of the
share certificate(s) representing the class C preferred shares which
the registered holder desires to have the Company redeem together
with such a request, the Company shall on, or at its option, before,
the redemption date redeem such class C preferred shares by paying
to the registered holder thereof, for each share to be redeemed, an
amount equal to the redemption price in respect thereof; such
payment shall be made by cheque payable at par at any branch of the
Company's bankers for the time being in Canada. The said class C
preferred shares shall be deemed to be redeemed on the date of
payment of the redemption price and from and after such date such
class C preferred shares shall cease to be entitled to dividends and
the holders thereof shall not be entitled to exercise any of the
rights of the holders of class C preferred shares in respect
thereof. Notwithstanding the foregoing, the Company shall only be
obliged to redeem class C preferred shares so tendered for
redemption to the extent that such redemption would not be contrary
to any applicable law, and if such redemption of any such class C
preferred shares would be contrary to any applicable law, the
Company shall only be obliged to redeem such class C preferred
shares to the extent that the moneys applied thereto shall be such
amount (rounded to the next lower multiple of one hundred dollars
($100.00)) as would not be contrary to such law, in which case the
Company shall pay to each holder his pro rata share of the purchase
moneys allocable. If less than all the class C preferred shares
represented by any certificate be redeemed, a new certificate for
the balance shall be issued.
(g) The Company may purchase for cancellation at any time all, or from
time to time any part, of the class C preferred shares outstanding,
by private contract at any price, with the unanimous consent of the
holders of the class C preferred shares then outstanding, or by
invitation for tenders addressed to all the holders of the class C
preferred shares at the lowest price at which, in the opinion of the
directors, such shares are obtainable but not exceeding the
redemption price thereof. If less than all the class C preferred
shares represented by any certificate be purchased for cancellation,
a new certificate for the balance shall be issued.
(h) For the purposes of the foregoing paragraphs IV. (b), (c) and (d),
the "class C preferred redemption price" of each class C preferred
share shall be an amount equal to (i) the monetary consideration
received by the Company upon the issuance of such share (denominated
in the currency in which such consideration was paid to the
Company), if such share has been issued for money; or (ii) the fair
market value of the consideration received by the Company
(including, without limitation, shares of another class of the
Company) upon the issuance of such share, if such share has been
issued for a consideration other than money. Subject to the
provisions of the following sub-paragraph, such fair market value is
to be determined by the directors on the basis of generally accepted
accounting and valuation principles.
The fair market value determined as hereinabove provided for shall
be subject to revision in accordance with any binding agreement
with, or decision by, the appropriate taxation authorities, or any
judgment of a court of competent jurisdiction. In the event that
any such agreement, decision or judgment shall result in a final
determination under the provisions of the appropriate taxation
legislation and the amount thereby determined is an amount other
than the amount for which such share was originally issued as
determined by the directors in accordance with the preceding
sub-paragraph, such finally determined amount for the purpose of the
appropriate taxation legislation shall then be deemed to be the fair
market value of the consideration received by the Company upon the
issuance of such class C preferred share.
(i) In the event that only part of the amount of the consideration
received by the Company for any class C preferred share issued by
the Company is added to the issued and paid up capital account for
the class of shares of which such class C preferred share forms
part, such class C preferred share shall be deemed to have been
issued for the full amount of the consideration received, for all
purposes of these articles (except only the issued and paid up
capital of such class C preferred shares) including, but without
limiting the generality of the foregoing, dividend rights,
redemption rights and rights upon liquidation and dissolution.
(j) No change to any of the provisions of paragraphs IV. (a) to (i) or
of this paragraph (j) shall have any force or effect until a by-law
has been approved by a majority of not less than two-thirds (2/3) of
the votes cast by the holders of the class C preferred shares,
voting separately as a class at a meeting of such holders specially
called for that purpose, or by a resolution in writing signed by all
the holders of the class C preferred shares, in addition to any
other approval required by the Act.
V. The class D preferred shares shall have attached thereto the following
rights, privileges, restrictions and conditions:
(a) Subject to the provisions of the Act or as otherwise expressly
provided herein, the holders of the class D preferred shares shall
not be entitled to receive notice of, nor to attend or vote at
meetings of the shareholders of the Company.
(b) The holders of the class D preferred shares shall be entitled to
receive during each month, as and when declared by the board of
directors, but always in preference and priority to any payment of
dividends on the class A and the class B common shares or any other
shares ranking junior to the class D preferred shares,
non-cumulative dividends at a fixed rate of one percent (1%) per
month calculated on the class D preferred redemption price (as
hereinafter in paragraph V. (h) defined) of each such share payable
in money, property or by the issue of fully paid shares of any class
of the Company. The holders of the class D preferred shares shall
not be entitled to any dividend in excess of the dividend
hereinbefore provided for.
(c) In the event of the liquidation, dissolution or winding-up of the
Company, whether voluntary or involuntary, or other distribution of
assets of the Company among shareholders for the purpose of
winding-up its affairs, the holders of the class D preferred shares
shall be entitled to receive for each class D preferred share, in
preference and priority to any distribution of the property or
assets of the Company to the holders of the class A and the class B
common shares or any other shares ranking junior to the class D
preferred shares, an amount equal to the class D preferred
redemption price plus all declared and unpaid dividends thereon, but
shall not be entitled to share any further in the distribution of
the property or assets of the Company.
(d) The Company may, in the manner hereinafter provided, redeem at any
time all, or from time to time any part, of the outstanding class D
preferred shares on payment for each class D preferred share to be
redeemed of the class D preferred redemption price plus all declared
and unpaid dividends thereon (in paragraphs V. (e), (f) and (g)
called the "redemption price").
(e) Before redeeming any class D preferred shares, the Company shall
mail or deliver to each person who, at the date of such mailing or
delivery, shall be a registered holder of class D preferred shares
to be redeemed, notice of the intention of the Company to redeem
such shares held by such registered holder; such notice shall be
delivered to, or mailed by ordinary prepaid post addressed to, the
last address of such holder as it appears on the records of the
Company, or in the event of the address of any such holder not
appearing on the records of the Company, then to the last address of
such holder known to the Company, at least one (1) day before the
date specified for redemption; such notice shall set out the
redemption price, the date on which the redemption is to take place
and, if part only of the class D preferred shares held by the person
to whom it is addressed is to be redeemed, the number thereof so to
be redeemed; on or after the date so specified for redemption the
Company shall pay or cause to be paid the redemption price to the
registered holders of the class D preferred shares to be redeemed on
presentation and surrender of the certificates for the class D
preferred shares so called for redemption at the registered office
of the Company or at such other place or places as may be specified
in such notice, and the certificates for such class D preferred
shares shall thereupon be cancelled, and the class D preferred
shares represented thereby shall thereupon be redeemed; from and
after the date specified for redemption in such notice, the holders
of the class D preferred shares called for redemption shall cease to
be entitled to dividends in respect of such shares and shall not be
entitled to exercise any of the rights of the holders thereof,
except the right to receive the redemption price, unless payment of
the redemption price shall not be made by the Company in accordance
with the foregoing provisions, in which case the rights of the
holders of such shares shall remain unaffected; on or before the
date specified for redemption, the Company shall have the right to
deposit the redemption price of the class D preferred shares called
for redemption in a special account with any chartered bank or trust
company in Canada named in the notice of redemption, to be paid,
without interest, to or to the order of the respective holders of
such class D preferred shares called for redemption, upon
presentation and surrender of the certificates representing the same
and, upon such deposit being made or upon the date specified for
redemption, whichever is later, the class D preferred shares in
respect whereof such deposit shall have been made, shall be deemed
to be redeemed and the rights of the respective holders thereof,
after such deposit or after such redemption date, as the case may
be, shall be limited to receiving, out of the moneys so deposited,
without interest, the redemption price applicable to their
respective class D preferred shares against presentation and
surrender of the certificates representing such class D preferred
shares. If less than all the class D preferred shares are to be
redeemed, the shares to be redeemed shall be redeemed pro rata,
disregarding fractions, unless the holders of the class D preferred
shares unanimously agree to the adoption of another method of
selection of the class D preferred shares to be redeemed. If less
than all the class D preferred shares represented by any certificate
be redeemed, a new certificate for the balance shall be issued.
(f) A holder of class D preferred shares shall be entitled to require
the Company to redeem at any time all, or from time to time any
part, of the class D preferred shares registered in the name of such
holder by tendering to the Company at its head office the share
certificate(s) representing the class D preferred shares which the
registered holder desires to have the Company redeem together with a
request in writing specifying (i) the number of class D preferred
shares which the registered holder desires to have redeemed by the
Company and (ii) the business day (in this paragraph referred to as
the "redemption date") on which the holder desires to have the
Company redeem such class D preferred shares, which redemption date
shall not be less than five (5) days after the day on which the
request in writing is given to the Company. Upon receipt of the
share certificate(s) representing the class D preferred shares which
the registered holder desires to have the Company redeem together
with such a request, the Company shall on, or at its option, before,
the redemption date redeem such class D preferred shares by paying
to the registered holder thereof, for each share to be redeemed, an
amount equal to the redemption price in respect thereof; such
payment shall be made by cheque payable at par at any branch of the
Company's bankers for the time being in Canada. The said class D
preferred shares shall be deemed to be redeemed on the date of
payment of the redemption price and from and after such date such
class D preferred shares shall cease to be entitled to dividends and
the holders thereof shall not be entitled to exercise any of the
rights of the holders of class D preferred shares in respect
thereof. Notwithstanding the foregoing, the Company shall only be
obliged to redeem class D preferred shares so tendered for
redemption to the extent that such redemption would not be contrary
to any applicable law, and if such redemption of any such class D
preferred shares would be contrary to any applicable law, the
Company shall only be obliged to redeem such class D preferred
shares to the extent that the moneys applied thereto shall be such
amount (rounded to the next lower multiple of one hundred dollars
($100.00)) as would not be contrary to such law, in which case the
Company shall pay to each holder his pro rata share of the purchase
moneys allocable. If less than all the class D preferred shares
represented by any certificate be redeemed, a new certificate for
the balance shall be issued.
(g) The Company may purchase for cancellation at any time all, or from
time to time any part, of the class D preferred shares outstanding,
by private contract at any price, with the unanimous consent of the
holders of the class D preferred shares then outstanding, or by
invitation for tenders addressed to all the holders of the class D
preferred shares at the lowest price at which, in the opinion of the
directors, such shares are obtainable but not exceeding the
redemption price thereof. If less than all the class D preferred
shares represented by any certificate be purchased for cancellation,
a new certificate for the balance shall be issued.
(h) For the purposes of the foregoing paragraphs V. (b), (c) and (d),
the "class D preferred redemption price" of each class D preferred
share shall be an amount equal to (i) the monetary consideration
received by the Company upon the issuance of such share (denominated
in the currency in which such consideration was paid to the
Company), if such share has been issued for money; or (ii) the fair
market value of the consideration received by the Company
(including, without limitation, shares of another class of the
Company) upon the issuance of such share, if such share has been
issued for a consideration other than money. Subject to the
provisions of the following sub-paragraph, such fair market value is
to be determined by the directors on the basis of generally accepted
accounting and valuation principles.
The fair market value determined as hereinabove provided for shall
be subject to revision in accordance with any binding agreement
with, or decision by, the appropriate taxation authorities, or any
judgment of a court of competent jurisdiction. In the event that
any such agreement, decision or judgment shall result in a final
determination under the provisions of the appropriate taxation
legislation and the amount thereby determined is an amount other
than the amount for which such share was originally issued as
determined by the directors in accordance with the preceding
sub-paragraph, such finally determined amount for the purpose of the
appropriate taxation legislation shall then be deemed to be the fair
market value of the consideration received by the Company upon the
issuance of such class D preferred share.
(i) In the event that only part of the amount of the consideration
received by the Company for any class D preferred share issued by
the Company is added to the issued and paid up capital account for
the class of shares of which such class D preferred share forms
part, such class D preferred share shall be deemed to have been
issued for the full amount of the consideration received, for all
purposes of these articles (except only the issued and paid up
capital of such shares) including, but without limiting the
generality of the foregoing, dividend rights, redemption rights and
rights upon liquidation and dissolution.
(j) No change to any of the provisions of paragraphs V. (a) to (i) or of
this paragraph (j) shall have any force or effect until a by-law has
been approved by a majority of not less than two-thirds (2/3) of the
votes cast by the holders of the class D preferred shares, voting
separately as a class at a meeting of such holders specially called
for that purpose, or by a resolution in writing signed by all the
holders of the class D preferred shares, in addition to any other
approval required by the Act.
APPENDIX 2
(1) The number of its shareholders is limited to fifty (50), exclusive
of present or former employees of the Company or of a subsidiary.
(2) The Company shall not make a distribution to the public of any of
its securities.
(3) The directors may, when they deem it expedient:
(a) borrow money upon the credit of the Company;
(b) issue debentures or other securities of the Company, and
pledge or sell the same for such sums and at such prices as
may be deemed expedient;
(c) hypothecate the immovable and movable property or otherwise
affect the movable property of the Company.
<PAGE>
Gouvernement du Quebec A-110220-J9401
L'Inspecteur general
des institutions financieres
Form 4
NOTICE CONCERNING COMPOSITION
OF THE BOARD OF DIRECTORS
The Companies Act, R.S.Q., c. C-38
Part 1A
1 Corporate name
SYSTEMES GRAPHIQUES SOUTHERN-CANADA, LTEE
SOUTHERN GRAPHIC SYSTEMS-CANADA, LTD.
2 Present address of the company:
1420 Sherbrooke Street West, Suite 802
No Street name
Montreal
Municipality
Quebec H3G 1K9
Province Postal code
Full residential address
Name and surname (including postal code)
3 The directors of the Company are:
Christino, Thomas P. 6601 West Broad Street, Richmond, Virginia, U.S.A.
23230
Taylor, Julian H. 6601 West Broad Street, Richmond, Virginia, U.S.A.
23230
Jones, D. Michael 6601 West Broad Street, Richmond, Virginia, U.S.A.
23230
Hammond, T.L. 2929 South Floyd Street, Louisville, Kentucky,
U.S.A. 40213
______________________________________________________________________________
If space is insufficient, attach an appendix in two (2) copies
The Company
Post occupied
Maryse Bertrand by signatory Incorporator
(signature)
______________________________________________________________________________
For departmental use only CA214REV.12-93)
Gouvernement
du Quebec
Depose le
31 MARS 1994
L'Inspecteur general des
Institutions financieres
<PAGE>
Gouvernement du Quebec A-110220-J9401
L'Inspecteur general
des institutions financieres
Form 2
NOTICE OF ADDRESS OF HEAD OFFICE
The Companies Act, R.S.Q., c. C-38
Part 1A
1 Corporate name
SYSTEMES GRAPHIQUES SOUTHERN-CANADA, LTEE
SOUTHERN GRAPHIC SYSTEMS-CANADA, LTD.
2 Notice is hereby given that the address of the head office of the company,
within the limits of the judicial district indicated in the articles, is as
follows:
1420 Sherbrooke Street West, Suite 802
No Street name
Montreal
Municipality
Quebec H3G 1K9
Province Postal code
The Company
Post occupied
Maryse Bertrand by signatory Incorporator
(signature)
_______________________________________________________________________________
For departmental use only CA-212(REV.12-93)
Gouvernement
du Quebec
Depose le
31 MARS 1994
L'Inspecteur general des
Institutions financieres
EXHIBIT 4.16
SOUTHERN GRAPHIC SYSTEMS-CANADA, LTD.
SYSTEMES GRAPHIQUES SOUTHERN-CANADA, LTEE
-----------------------------------------
BY-LAW ONE
----------
being the general by-laws of the Company.
ARTICLE ONE
DEFINITIONS
SECTION 1.01 In this by-law and all other by-laws of the Company, unless the
context otherwise requires:
(a) "Act" means the Companies Act (Quebec) (R.S.Q. 1977, c. C-38), as
amended by the Act modifying the Companies Act and other statutory
dispositions, S.Q. 1979, c. 31, as from time to time further amended,
and every statute that may be substituted therefor and, in the case
of such amendment or substitution, any reference in the by-laws of
the Company to any provision of the Act shall be read as referring to
the amended or substituted provisions therefor;
(b) "articles" means the articles of incorporation of the Company
attached to the certificate of incorporation dated March 31, 1994, as
from time to time amended;
(c) "by-law" means this by-law and any other by-law of the Company from
time to time in force and effect;
(d) words importing the singular number shall include the plural and vice
versa; words importing the masculine gender shall include the
feminine and neuter genders and vice-versa; words importing persons
shall include bodies corporate, corporations, companies,
partnerships, syndicates, trusts and any number or aggregate of
individuals;
(e) the headings used in the by-laws are inserted for reference purposes
only and are not to be considered or taken into account in construing
the terms or provisions thereof or to be deemed in any way to
clarify, modify or explain the effect of any such terms of
provisions; and
(f) all terms contained in the by-laws and which are defined in the Act
shall have the meanings given to such terms in the Act.
In the case of any conflict between the Act, the unanimous
shareholder agreement, the articles and the by-laws of the Company, the Act
shall prevail over the unanimous shareholder agreement, the articles and the
by-laws, the unanimous shareholder agreement shall prevail over the articles
and the by-laws and the articles shall prevail over the by-laws.
ARTICLE TWO
HEAD OFFICE
SECTION 2.01 The Company shall maintain a head office in Quebec in the
judicial district indicated in its articles. The Company may change the address
of its head office within the limits of the judicial district indicated in its
articles by a resolution of its board of directors. It may also transfer its
head office to another judicial district by amending its articles and such
transfer shall have effect as of the date of the amendment to the articles.
ARTICLE THREE
FINANCIAL YEAR
SECTION 3.01 The fiscal period of the Company shall terminate on such date in
each year as the board of directors may from time to time by resolution
determine.
ARTICLE FOUR
CORPORATE SEAL
SECTION 4.01 The Company may have one or more corporate seals which shall be
such as the board of directors may by resolution from time to time adopt and
change.
ARTICLE FIVE
DIRECTORS
SECTION 5.01 NUMBER AND POWERS. The Company shall be managed by a board of
directors consisting of such fixed number, or minimum and maximum number, of
directors as may be set out in the articles.
SECTION 5.02 QUALIFICATIONS. Subject to any provision to the contrary in the
articles, a director of the Company need not be a shareholder of the Company or
a resident of Canada or of Quebec. Moreover, any natural person may be a
director of the Company, with the exception of a person under the age of
eighteen (18) years, an interdicted person, a person of unsound mind who has
been declared incapable by a court of another province or another country, and
an undischarged bankrupt.
SECTION 5.03 FILLING OF VACANCIES. Subject to the Act, if a vacancy occurs
in the board of directors, a quorum of the board of directors may appoint a
qualified person to fill the vacancy for the remainder of the term of the
director giving rise to the vacancy.
SECTION 5.04 TERM OF OFFICE. A director's term of office shall commence on
the date of the meeting at which he is elected or appointed and shall terminate
at the annual meeting next following his election or appointment (unless re-
elected) or, if an election of the board of directors is not held at such
meeting or if such meeting does not occur, on the date on which his successor
is elected or appointed. A director's term of office shall also terminate if
he dies or resigns, or is removed or ceases to be qualified to act as a
director.
SECTION 5.05 VACATION OF OFFICE. The office of a director shall ipso facto
be vacated if:
(a) he dies;
(b) he resigns his office, by notice in writing to the Company, such
resignation to be effective immediately upon receipt thereof by the
Company unless by its terms it is made effective at a later date;
(c) subject to the provisions of the articles, he is removed from office
in accordance with the provisions of the Act by a resolution of the
shareholders who are entitled to elect directors; or
(d) he ceases to be qualified to be a director.
SECTION 5.06 ELECTION. Directors shall be elected by the shareholders by
ordinary resolution passed on a ballot at a meeting of shareholders entitled to
elect directors.
A retiring director shall remain in office until the adjournment or
termination of the meeting at which his successor has been elected, unless such
meeting was called for the purpose of removing him from office as a director,
in which case the director so removed shall vacate office forthwith upon the
passing of the resolution for his removal.
SECTION 5.07 VALIDATION. All acts done at any meeting of the directors by
any person or persons acting as a director or directors shall, notwithstanding
that it be afterwards discovered that there was a defect in the appointment of
any such director or directors or person or persons acting as aforesaid, or
that they or any of them were disqualified as directors, be as valid as if
every such person or persons had been duly appointed and qualified as
directors.
SECTION 5.08 PLACE OF MEETING. Meetings of the board of directors shall be
held at the head office of the Company or at any other place as the officers or
directors convening the meeting may from time to time determine. A meeting of
the board of directors may be convened at any time by the chairman of the
board of directors, the president, any vice-president, the secretary, any
assistant-secretary or by two or more directors (other than any of the
foregoing officers).
SECTION 5.09 NOTICE. Notice of the time and place for the holding of any
such meeting shall be given verbally or delivered or mailed or telegraphed or
sent by any other form of transmitted or recorded message to each director at
his latest address as shown on the books of the Company not less than two (2)
days before the date of the meeting.
For the first meeting of the board of directors to be held
immediately following the election of directors at an annual or special meeting
of the shareholders, no notice of such meeting need be given to the directors
in order for the meeting to be duly constituted, provided a quorum of the
directors is present.
SECTION 5.10 WAIVER OF NOTICE. Notice of any meeting of the board of
directors or any irregularity in any meeting or in the notice thereof may be
waived by any director in writing (which shall include waiver by telegram,
cable or telex) addressed to the Company at its head office; such waiver may be
validly given either before or after the meeting to which such waiver relates.
The attendance of a director at a meeting of directors constitutes a waiver of
notice of the meeting except where a director attends a meeting for the express
purpose of objecting to the holding of the meeting on the grounds that the
manner of calling the meeting was irregular.
SECTION 5.11 PARTICIPATION BY TELEPHONE. A director may, if all the
directors of the Company consent, participate in a meeting of the board of
directors by such means, particularly by telephone as permits all persons
participating in the meeting to hear each other. A director participating in
such a meeting by such means shall be deemed to be present at that meeting.
SECTION 5.12 ADJOURNMENT. Any meeting of the board of directors may be
adjourned from time to time by the chairman of the meeting, with the consent of
the meeting, to such time and place as he may fix. No notice of an adjourned
meeting need be given to any director. Any adjourned meeting shall be duly
constituted if held in accordance with the terms of the adjournment and a
quorum is present thereat. The directors who formed a quorum at the original
meeting are not required to form the quorum at the adjourned meeting. If there
is no quorum present at the adjourned meeting, the original meeting shall be
deemed to have terminated forthwith after its adjournment.
SECTION 5.13 QUORUM. The directors may, from time to time, fix by resolution
the quorum for meetings of directors, but until otherwise fixed, a majority of
the directors in office from time to time shall constitute a quorum. Any
meeting of directors at which a quorum is present shall be competent to
exercise all or any of the authorities, powers and discretions by or under the
by-laws of the Company for the time being vested in or exercisable by the
directors generally. Where the Company has only one director, that director
shall constitute the meeting.
SECTION 5.14 VOTING. Questions arising at any meeting of the board of
directors shall be decided by a majority of votes cast. In case of an equality
of votes, the chairman of the meeting shall not be entitled to a second or
casting vote.
SECTION 5.15 RESOLUTION IN WRITING IN LIEU OF MEETING. A resolution in
writing, signed by all the directors entitled to vote on that resolution at a
meeting of directors or of the executive committee of directors, as the case
may be, is as valid as if it had been passed at a meeting of directors or of
the executive committee of directors, respectively.
A copy of every such resolution shall be kept with the minutes of the
proceedings of the board of directors or executive committee of directors.
SECTION 5.16 REMUNERATION OF DIRECTORS. Subject to the articles or any
unanimous shareholders' agreement, the remuneration to be paid to the directors
shall be such as the board of directors shall from time to time by resolution
determine and such remuneration shall be in addition to the salary paid to any
officer of the Company who is also a member of the board of directors. The
directors may also by resolution award special remuneration to any director
undertaking any special services on the Company's behalf other than the routine
work ordinarily required of a director by the Company. The confirmation of any
such resolution or resolutions by the shareholders shall not be required.
ARTICLE SIX
SUBMISSION OF CONTRACTS OR
TRANSACTIONS TO SHAREHOLDERS FOR APPROVAL
SECTION 6.01 The board of directors in its discretion may submit any
contract, act or transaction for approval, ratification or confirmation at any
annual meeting of the shareholders or at any special meeting of the
shareholders called for the purpose of considering the same. Any contract, act
or transaction that shall be approved, ratified or confirmed by resolution
passed by a majority of the votes cast at any such meeting (unless any
different or additional requirement is imposed by the Act or by the Company's
articles or any other by-law) shall be as valid and as binding upon the Company
and upon all the shareholders as though it had been approved, ratified and/or
confirmed by every shareholder of the Company.
ARTICLE SEVEN
OFFICERS
SECTION 7.01 APPOINTMENT OF OFFICERS. Subject to any unanimous shareholder
agreement, the board of directors, annually or as often as may be required,
shall appoint a president, and if they see fit, a chairman of the board and one
or more vice-presidents of the Company and may also appoint a secretary, a
treasurer and one or more assistant-secretaries and/or one or more assistant-
treasurers. Any two or more of such offices may be held by the same person.
If the same person holds the offices of secretary and treasurer, he may, but
need not, be known as a secretary-treasurer. The board of directors may from
time to time designate such other officers and appoint or authorize any one or
more of the foregoing officers to appoint such other officers, employees and
agents as it shall deem necessary who shall have such authority and shall
perform such functions and duties as may from time to time be prescribed by
resolution of the board of directors or by the officer or officers appointing
such other officers, employees or agents.
SECTION 7.02 QUALIFICATIONS. Subject to any contrary provisions herein, none
of the officers need be a director or a shareholder of the Company.
SECTION 7.03 REMUNERATION AND REMOVAL OF OFFICERS. Subject to any unanimous
shareholders' agreement, the remuneration of all officers, employees and agents
elected or appointed by the board of directors may be determined from time to
time by resolution of the board of directors. The fact that any officer,
employee or agent is a director or shareholder of the Company shall not
disqualify him from receiving such remuneration as may be so determined. The
board of directors may by resolution remove any officer, employee or agent at
any time, with or without cause, subject to his rights under any employment
contract in force between the Company and himself.
SECTION 7.04 DUTIES OF OFFICERS MAY BE DELEGATED. In case of the absence or
inability or refusal to act of any officer of the Company or for any other
reason that the board of directors may deem sufficient, the board may delegate
all or any of the powers of such officer to any other officer or to any
director for the time being.
SECTION 7.05 CHAIRMAN OF THE BOARD. The board of directors may from time to
time appoint a chairman of the board who shall be a director. The chairman
shall be the chief executive officer of the Company. The chairman presides, if
present, at all meetings of the board of directors and shall have such other
powers and duties as may from time to time be assigned to him by the board
of directors.
SECTION 7.06 PRESIDENT. If no chairman has been appointed, the president
shall be the chief executive officer of the Company. If a chairman has been
appointed, the president shall be the chief operating officer of the Company.
He shall exercise general supervision over the business and affairs of the
Company. In the absence of the chairman of the board (if any), the president
shall, if present, preside at all meetings of the board of directors and
shareholders; he shall sign such contracts, documents or instruments in writing
as require his signature and shall have such other powers and shall perform
such other duties as may from time to time be assigned to him by resolution of
the board of directors or as are incident to his office.
SECTION 7.07 VICE-PRESIDENT. The vice-president or, if more than one, the
vice-presidents in order of seniority, shall be vested with all the powers and
shall perform all the duties of the president in the absence or inability or
refusal to act of the president, provided, however, that a vice-president who
is not a director shall not preside as chairman at any meeting of directors or
shareholders. The vice-president or, if more than one, the vice-presidents,
shall sign such contracts, documents or instruments in writing as require his
or their signatures and shall also have such other powers and duties as may
from time to time be assigned to him or them by resolution of the board of
directors.
SECTION 7.08 SECRETARY. The secretary (if any), shall give or cause to be
given notices for all meetings of the board of directors and shareholders when
directed to do so. He shall have charge of the records and of the corporate
seal(s), (if any). He shall sign such contracts, documents or instruments in
writing as require his signature and shall have such other powers and duties
as may from time to time be assigned to him by resolution of the board of
directors or as are incident to his office.
SECTION 7.09 TREASURER. Subject to the provisions of any resolution of the
board of directors, the treasurer (if any) shall have the care and custody of
all the funds and securities of the Company and shall deposit the same in the
name of the Company in such bank or banks or with such other depositary or
depositaries as the board of directors may by resolution direct. He shall
prepare, maintain and keep or cause to be kept adequate books of accounts and
accounting records. He shall sign such contracts, documents or instruments in
writing as require his signature and shall have such other powers and duties as
may from time to time be assigned to him by resolution of the board of
directors or as are incident to his office. He may be required to give such
bonds for the faithful performance of his duties as the board of directors in
their uncontrolled discretion may require and no director shall be liable for
failure to require any such bond or for the insufficiency of any such bond or
for any loss by reason of the failure of the Company to receive any indemnity
thereby provided.
SECTION 7.10 ASSISTANT-SECRETARY AND ASSISTANT-TREASURER. The assistant-
secretary or, if more than one, the assistant-secretaries in order of
seniority, and the assistant treasurer or, if more than one, the assistant
treasurers in order of seniority, shall respectively perform all the duties of
the secretary and treasurer, respectively, in the absence or inability to act
of the secretary or treasurer as the case may be. The assistant-secretary or
assistant-secretaries, if more than one, and the assistant-treasurer or
assistant-treasurers, if more than one, shall sign such contracts, documents or
instruments in writing as require his or their signatures respectively and
shall have such other powers and duties as may from time to time be assigned to
them by resolution of the board of directors.
ARTICLE EIGHT
INDEMNITIES AND EXCLUSION OF LIABILITY
SECTION 8.01 The Company shall assume the defence of its directors and/or
officers prosecuted by a third person for acts done in the exercise of their
duties and the Company shall pay damages, if any, resulting from those acts,
unless the directors and/or officers have committed a grievous offence or a
personal offence separable from the exercise of their duties.
However, in a penal or criminal proceeding the Company shall assume
the payment of the expenses of its directors and/or officers only if they had
reasonable grounds to believe that their conduct was in conformity with the
law, or if they have been freed or acquitted.
The Company shall assume the expenses of its directors and/or
officers, if, having prosecuted any or all of them for an act done in the
exercise of their duties, it loses its case and the court so decides.
The Company shall assume the aforesaid obligations in respect of any
person who acted at its request as a director for a corporation of which it is
a shareholder or creditor.
ARTICLE NINE
MEETING OF SHAREHOLDERS
SECTION 9.01 ANNUAL MEETING. Subject to the Act, the annual meeting of the
shareholders of the Company shall be held on the first Friday after April 15 in
each year, or on such date in each year as the board of directors may from time
to time by resolution determine, at the head office of the Company or, subject
to the provisions of the Act, at any other place as may be specified in the
notice convening such meeting, as the directors may by resolution determine.
SECTION 9.02 SPECIAL MEETINGS. Other meetings of the shareholders may be
convened by order of the chairman of the board, president or a vice-president
or by the board of directors, to be held at such time and place as may be
specified in a resolution of the board of directors.
Special meetings of shareholders shall also be convened by the board
of directors or, if there is not a quorum in office, the director or directors
which remain, upon receipt by the secretary of the Company of a written
requisition, signed by shareholders holding in the aggregate not less than one
tenth (1/10) of the subscribed shares of the capital of the Company, stating
the business to be transacted at the proposed meeting.
If such meeting is not called and held within twenty-one (21) days of
the date on which the requisition is delivered to the head office of the
Company, any shareholder, whether signatories to the requisition or not, who
hold not less than one tenth in the value of the subscribed shares of the
capital of the Company, may themselves call the meeting. Notice of any special
meeting shall state the business which is to be transacted thereat.
SECTION 9.03 PLACE OF MEETINGS. Meetings of shareholders of the Company
shall be held at the head office of the Company or at such other place as may
be specified in the notice convening such meeting, which place must be located
in the province of Quebec in the case of annual meetings of shareholders and
meetings of shareholders at which any directors are elected. Notwithstanding
the foregoing, the annual shareholders' meeting and any meeting of shareholders
at which directors are elected may be held outside the Province of Quebec if
the Company has not made distribution to the public of its securities and if
its deed of incorporation so provides for it, or failing a provision in the
deed to that effect, if all the shareholders entitled to attend the meeting
consent. A shareholder who attends meetings held outside Quebec is deemed to
have so agreed except when he attends the meeting for the express purpose of
objecting to the transaction of any business on the grounds that the meeting is
not lawfully held.
SECTION 9.04 NOTICE. A printed, written or typewritten notice stating the
day, hour and place of meeting and the general nature of the business to be
transacted shall be sent not less than ten (10) days before the meeting, to the
shareholders entitled thereto by messenger or by prepaid registered or
certified mail to the shareholders entitled to vote at such meeting at their
respective addresses, as shown in the books of the Company. If the address of
a shareholder is not shown in the books of the Company, the notice may be
delivered by messenger or by prepaid registered or certified mail to the
address where, in the discretion of the sender, it is most likely to be
received by such shareholder. Notice of any meeting of shareholders or any
irregularity in any such meeting or in the notice thereof may be waived by any
shareholder or by the duly appointed proxy of any shareholder by telegram,
cable or telex or any other writing addressed to the Company and any such
waiver may be validly given either before or after the meeting to which such
waiver relates.
The attendance of a shareholder at a meeting constitutes waiver of
notice thereof or of any irregularity in the notice except where he attends for
the express purpose of objecting to the holding of the meeting on the grounds
that the manner of calling it was irregular.
SECTION 9.05 VOTING. Voting at a meeting of shareholders shall be by show of
hands except where a ballot is demanded by a shareholder entitled to vote at
the meeting. A shareholder may demand a ballot either before or after any vote
by show of hands.
SECTION 9.06 IRREGULARITIES AND OMISSIONS. Any irregularities affecting the
notice of meeting or its expedition, the involuntary omission to give any such
notice or the fact that such a notice has not been received by a shareholder,
shall not affect in any manner the validity of the meeting of shareholders.
Furthermore, the involuntary omission of the general nature of an item of
business which should have been mentioned in the notice of the meeting as being
on the agenda of the meeting, does not prevent such item of business from being
considered and voted upon at the meeting, unless a shareholder suffers
prejudice or his interests are injured as a result. A certificate signed by
the secretary or any other duly authorized officer of the Company or any
registrar or transfer agent for shares of the Company, shall constitute
conclusive evidence of the expedition of a notice of meeting to the
shareholders and the shareholders shall be bound by such certificate.
SECTION 9.07 RIGHT TO VOTE. Subject to the articles of the Company, at all
shareholders' meetings, each shareholder entitled to vote has as many votes as
he holds shares in the Company, and he may, subject to section 9.09 hereof,
vote by proxy. However, no shareholder in arrears in respect of any call may
vote at a shareholders' meeting.
SECTION 9.08 VOTES. Every question submitted to any meeting of shareholders
shall be decided in the first instance on a show of hands, unless a poll is
demanded. In case of an equality of votes, the chairman of the meeting, both
on a show of hands and on a poll, shall not have a second or casting vote in
addition to the vote or votes to which he may be entitled as a shareholder.
At any meeting, unless a poll is demanded, a declaration by the chairman of the
meeting that a resolution has been carried unanimously or by a particular
majority or lost or not carried unanimously or by a particular majority, along
with an entry to that effect in the minute books of the Company, will
constitute prima facia evidence of that fact without proof of the number or
proportion of votes recorded in favour of or against such resolution.
The chairman of the board, if any, shall preside at every meeting of
shareholders of the Company. If there is no chairman of the board or if he is
absent, the president of the Company shall preside as chairman and in his
absence this right devolves to the vice-president(s) designated for the purpose
of the board of directors. If at any meeting, none of the officers mentioned
above is present within the first fifteen (15) minutes following the time fixed
for the holding of the meeting, the shareholders present shall select from
their number a chairman of such meeting.
If at any meeting a poll is demanded on the election of a chairman or
on the question of adjournment or termination, it shall be taken forthwith
without adjournment. If a poll is demanded on any other question or as to the
election of directors, it shall be taken in such manner and either at once or
later at the meeting or after an adjournment as the chairman of the meeting
directs. The result of a poll shall be deemed to be the resolution of the
meeting at which the poll was demanded. A demand for a poll may be withdrawn.
Where a person holds shares as a personal representative, such person
or his proxy is the person entitled to vote at all meetings of shareholders in
respect of the shares so held by him.
Where two (2) or more persons hold the same share or shares jointly,
any one of such persons present at a meeting of shareholders has the right, in
the absence of the other or others, to vote in respect of such share or shares,
but if more than one of such persons are present or represented by proxy and
vote, they shall vote together as one on the share or shares jointly held by
them.
SECTION 9.09 PROXIES. A shareholder, including a shareholder that is a body
corporate, who is entitled to vote at a meeting of shareholders, may by means
of a proxy appoint a proxyholder or one or more alternate proxyholders, who are
not required to be shareholders, to attend and act at the meeting in the manner
and to the extent authorized by the proxy and with the authority conferred by
the proxy. A proxyholder, holding the right to vote on behalf of an absent
shareholder, shall not have the right to vote on show of hands.
An instrument appointing a proxyholder shall be in writing and shall
be executed by the shareholder or his attorney authorized in writing or, if the
shareholder is a body corporate, either under its seal or by an officer or
attorney thereof, duly authorized. A proxy expires at the end of one year from
the date on which it is issued, unless it expressly specifies some other
period.
Unless a relevant statute requires another form, an instrument
appointing a proxyholder may be in the following form or any similar form:
"The undersigned shareholder of ..... hereby appoints ..... of
.... or failing him, of ..... as the proxy of the undersigned to attend
and act for and on behalf of the undersigned at the meeting of the
shareholders of the said Company to be held on the .... day of ....,
19.., and at any adjournment thereof to the same extent and with the same
power as if the undersigned were personally present at the said meeting
or such adjournment thereof.
Dated the day of ...., 19...
Signature of shareholder
NOTE
This form of proxy must be signed by a shareholder or his attorney
authorized in writing or, if the shareholder is a body corporate, either
under its seal or by an officer or attorney thereof duly authorized."
An instrument appointing a proxy carries with it the revocation of
any previous instrument appointing another proxy in respect of such meeting.
The instrument appointing a proxy may be revoked at any time.
The directors may from time to time pass regulations regarding the
deposit of instruments appointing a proxy at some place or places other than
the place at which a meeting or adjourned meeting of shareholders is to be
held. They may as well from time to time pass regulations regarding
particulars of such instruments to be telegraphed, cabled, telexed or sent in
writing to the Company or any agent of the Company for the purpose of receiving
such particulars. These regulations may provide that any instrument appointing
a proxyholder so lodged may be voted upon as though the instruments themselves
were produced at the meeting or adjourned meeting in case of adjournment, and
votes given in accordance with such regulations shall be valid and shall be
counted. The chairman of any meeting of shareholders may, subject to
regulations, if any, made as aforesaid, in his discretion accept telegraphic,
telex, cable or written communication as to the authority of anyone claiming to
vote on behalf of and to represent a shareholder notwithstanding that no
instrument of proxy conferring such authority has been lodged with the Company.
Any votes given in accordance with such communications accepted by a chairman
of the meeting shall be counted.
SECTION 9.10 ADJOURNMENT. The chairman of the meeting may with the consent
of the meeting adjourn any meeting of shareholders from time to time to a fixed
time and place. If a meeting of shareholders is adjourned by one or more
adjournments for less than thirty (30) days, it is not necessary to give notice
of the adjourned meeting other than by announcement at the earlier meeting that
is adjourned. If a meeting of shareholders is adjourned by one or more
adjournments for an aggregate of thirty (30) days or more, notice of the
adjourned meeting shall be given as for an original meeting.
Any adjourned meeting shall be duly constituted if held in accordance
with the terms of the adjournment and a quorum is present thereat. The persons
who formed a quorum at the original meeting are not required to form a quorum
at the adjourned meeting. If there is no quorum present at the adjourned
meeting, the original meeting shall be deemed to have terminated forthwith
after its adjournment. Any business may be brought before or dealt with at any
adjourned meeting which might have been brought before or dealt with at the
original meeting in accordance with the notice calling same.
SECTION 9.11 QUORUM. Unless otherwise required by the Act, the articles or
any other by-law, one or more persons present and holding or representing by
proxy at least one (1) issued share of the Company entitled to vote at the
meeting shall constitute a quorum of any meeting of shareholders for the
choice of a chairman of the meeting and for the adjournment of the meeting.
For all other purposes, one or more persons present and holding or representing
by proxy not less than fifty-one percent (51%) of the shares entitled to vote
at the meeting shall constitute a quorum for such a meeting.
SECTION 9.12 RESOLUTION IN WRITING IN LIEU OF MEETING. A resolution in
writing signed by all the shareholders entitled to vote on that resolution at a
meeting of shareholders is as valid as if it had been passed at a meeting of
the shareholders.
A copy of every such resolution shall be kept with the minutes of the
meetings of shareholders.
SECTION 9.13 PARTICIPATION BY TELEPHONE. The shareholders of the Company
that has not made a distribution to the public of its securities may
participate and vote at a shareholders' meeting by any means allowing all the
participants to communicate with each other.
ARTICLE TEN
SHARES
SECTION 10.01 ALLOTMENT. The board of directors may from time to time allot
or grant options to purchase the whole or any part of the authorized and
unissued shares of the capital of the Company, including any shares created by
an amendment to the articles increasing or otherwise varying the capital of the
Company, to such person or persons or class of persons as the board of
directors shall, by resolution, determine.
SECTION 10.02 CALLS. The board of directors may, by resolution, make calls
upon the shareholders in respect of any moneys unpaid on the whole or any part
of shares held or subscribed by them, at the times and in the manner required
or permitted by the Act, the articles or the by-laws.
A call shall be deemed to have been made at the time when the
resolution of the board of directors authorizing such call was passed. If a
shareholder fails to pay any call due by him, on or before the day appointed
for the payment thereof, he shall be liable to pay interest thereon at the rate
of six percent (6%) per annum on the sum due from the date appointed for the
payment of such call to the time of actual payment.
The directors may, if they think fit, receive from any shareholder
willing to advance the same, all or any part of the amounts due on shares held
by such shareholder, in addition to amounts then actually owing by virtue of a
call or calls on shares held by him. The Company may pay interest at a rate
not exceeding eight percent (8%) per annum as may be agreed between the
directors and the shareholders who pay such sums in advance, on the moneys so
paid in advance, or so much thereof as, from time to time exceeds the amount of
the call then made upon the shares in respect of which the advance payment was
made.
However, if after a call is made and notice thereof is given to the
shareholder as prescribed by the resolution of the directors authorizing such
call, the call is not paid within such time as the directors prescribe by the
said resolution, the directors may, in their discretion, by resolution to that
effect and duly recorded in the minutes, summarily declare forfeited such share
or shares for which the amount called has not been paid and the same shall
thereupon become the property of the Company and may be disposed of as the
directors may prescribe. However, notwithstanding such forfeiture, the holder
of such shares at the time of the forfeiture shall continue to be liable
towards the then creditors of the Company, for the total amounts unpaid on such
shares at the time of the forfeiture, less the amounts which are subsequently
received by the Company in respect thereof.
Instead of declaring any share or shares forfeited, the directors
may, if they see fit, enforce payment of all calls, and interest thereon, by
action in any court of competent jurisdiction, the whole as prescribed by the
Act.
SECTION 10.03 SHARE CERTIFICATES. Share certificates (and the form of stock
transfer power on the reverse side thereof) shall be in such form and signed by
such director(s) and/or officer(s) as the board of directors may from time to
time by resolution determine.
SECTION 10.04 REGISTRAR AND TRANSFER AGENTS. The board of directors may
provide for the registration of securities issued as well as the registration
of transfers of securities of the Company in one or several places. The board
of directors may from time to time by resolution appoint or remove one or more
registrars and/or branch registrars (which may but need not be the same person)
to keep the register of securities and/or holders. The board of directors may
also appoint one or more transfer agents and/or branch transfer agents (which
may but need not be the same person) to keep the registers of securities
and/or transfers. All certificates issued after any such appointment
representing securities issued by the Company and in respect of the class for
which such appointment has been made shall be countersigned by or on behalf of
the said registrar transfer agent of such securities as the case may be.
SECTION 10.05 TRANSFERS. All transfers of shares of the capital of the
Company and all pertinent information relating thereto shall be registered in
the register of transfers. Registration of a transfer of shares of the capital
of the Company in the register of transfers held at the head office of the
Company or elsewhere as provided for in the by-laws, shall constitute a
complete and valid transfer. Subject to any provision to the contrary
contained in the Act, no transfer of shares of the capital of the Company shall
be valid for any purpose until entry thereof is duly made in the register of
transfers or in a branch register of transfers. The directors may refuse to
register any transfer of shares belonging to any shareholder who is indebted
to the Company. A share may not be transferred without the consent of the
directors if its price has not been fully paid. No share shall be transferable
until all calls payable thereon up to the time of transfer have been fully
paid.
SECTION 10.06 SURRENDER OF SHARE CERTIFICATES. No transfer of a share issued
by the Company shall be recorded or registered unless and until the certificate
representing the share to be transferred has been surrendered and cancelled or,
if no certificate has been issued by the Company in respect of such share,
unless and until a duly executed share transfer power in respect thereof has
been presented for registration.
SECTION 10.07 REPLACEMENT OF CERTIFICATES. Where a shareholder declares under
oath to the Company or the registrar, a branch registrar, transfer agent or a
branch transfer agent of the Company, that the share certificate which he held
has been destroyed, stolen or lost, and describes the circumstances under
which this occurred, and provides, if so required, a bond against any loss for
which the Company may be held responsible with regard to the issue of a new
certificate, the president, or vice-president, the secretary or the treasurer,
may issue a new certificate in replacement of the one which has been destroyed,
stolen or lost.
ARTICLE ELEVEN
DIVIDENDS
SECTION 11.01 Subject to the provisions of the Act, the board of directors may
from time to time by resolution declare dividends payable to the shareholders
according to their respective rights and interests in the Company. Dividends
may be paid in money or property or by issuing fully paid shares of the
Company.
The directors may deduct from the dividends payable to a shareholder
any amounts owed by the shareholder to the Company by virtue of a call or calls
or for any other reason.
As long as the Company pays interest on any amounts received in
advance on shares in addition to amounts due by virtue of a call or calls, such
amounts shall not be deemed paid on the said shares.
Before declaring a dividend or a distribution of profits of the Company,
the directors may transfer such sums as they may in their discretion decide to
one or several reserve funds which may be used at the discretion of the
directors for all purposes for which the profits of the Company may be legally
applied.
ARTICLE TWELVE
NOTICES
SECTION 12.01 NOTICE TO JOINT SHAREHOLDERS. If two (2) or more persons are
registered as joint holders of any share, any notice shall be addressed to all
of such joint holders but notice to one of such persons shall be sufficient
notice to all of them.
SECTION 12.02 PERSONS BECOMING ENTITLED BY TRANSFER OR OPERATION OF LAW.
Every person who by operation of law, transfer or by any other means whatsoever
shall become entitled to any shares in the capital of the Company shall be
bound by every notice or other document in respect of such shares which prior
to his name and address being entered on the records of the Company shall have
been duly given to the person or persons from whom he derives his title to such
shares.
SECTION 12.03 DECEASED SHAREHOLDERS. Any notice or other document delivered
or sent by post or left at the address of any shareholder as the same appears
in the records of the Company shall, notwithstanding that such shareholder be
then deceased and whether or not the Company has notice of his decease, be
deemed to have been duly served in respect of the shares held by such
shareholder (whether held solely or with other persons) until some other person
is entered in his stead in the records of the Company as the holder or one of
the holders thereof. Such service shall for all purposes be deemed a
sufficient service of such notice or other document on his heirs, executors or
administrators and all persons (if any) interested with him in such shares.
SECTION 12.04 SIGNATURES TO NOTICES. The signature of any director or officer
of the Company to any notice may be written, stamped, typewritten or printed or
partly written, stamped, typewritten or printed.
SECTION 12.05 COMPUTATION OF TIME. Where a given number of days, notice or
notice extending over any period is required to be given under any provisions
of the articles or by-laws of the Company, the day of service or posting of the
notice shall, unless it is otherwise provided, be counted in such number of
days or other period and such notice shall be deemed to have been given or sent
on the day of service or posting.
A notice or other document served by post by the Company on a
shareholder shall be held to be served at the time when the registered or
certified letter containing it would be delivered in the ordinary course of
post, and to prove the fact and time of service it shall be sufficient to prove
that such letter was properly addressed and put into the post office at the
time when it was put in and the time required for its delivery in the ordinary
course of post.
ARTICLE THIRTEEN
AUDITOR
SECTION 13.01 Subject to sections 123.98 to 123.100 of the Act, an auditor
shall be appointed each year by the shareholders at their first meeting and at
every subsequent annual meeting. The remuneration of the auditor shall be set
by the shareholders or by the directors when this power has been delegated to
them by the shareholders. No director or officer of the Company may be
appointed as auditor. If the auditor ceases to exercise his functions for any
reason before the end of his term, the directors may fill the vacancy and
appoint a replacement auditor who shall act as auditor until the annual meeting
of shareholders next following his appointment.
ARTICLE FOURTEEN
CHEQUES, DRAFTS, NOTES
SECTION 14.01 All cheques, drafts or orders for the payment of money and all
notes, acceptances and bills of exchange shall be signed by such officer or
officers or other person or persons, whether or not officers of the Company,
and in such manner as the board of directors may from time to time determine by
resolution.
ARTICLE FIFTEEN
CUSTODY OF SECURITIES
SECTION 15.01 All securities (including warrants) owned by the Company shall
be lodged (in the name of the Company) with a chartered bank or a trust company
or in a safety deposit box or with such other financial institution or in such
other manner as may be determined from time to time by the proper officers of
the Company.
ARTICLE SIXTEEN
EXECUTION OF CONTRACTS
SECTION 16.01 Deeds, contracts, documents, or instruments in writing requiring
the signature of the Company may be signed by one (1) person alone who holds
the office of chairman of the board, president, vice-president, director,
secretary, treasurer, assistant secretary or assistant treasurer or any other
office created by by-law or by resolution of the board. In addition, the board
of directors may from time to time direct the manner in which the person or
persons by whom any particular instrument or class of instruments may or shall
be signed.
Any signing officer may affix the corporate seal (if any) to any
contract, document or instrument requiring the same.
The term contracts, documents or instruments in writing as used in
this by-law shall include deeds, mortgages, hypothecs, charges, conveyances,
transfers and assignments of property, real or personal, immoveable or
moveable, agreements, releases, receipts and discharges for the payment of
money or other obligations, conveyances, transfers and assignment of shares,
warrants, bonds, debentures or other securities and all other writings.
In particular, one person alone who holds the office of chairman of
the board, president, vice-president or director, secretary, treasurer,
assistant-secretary or assistant-treasurer or any other office created by by-
law or by resolution of the board is hereby authorized to sell, assign,
transfer, exchange, convert or convey all shares, bonds, debentures, rights,
warrants or other securities owned by or registered in the name of the Company
and to sign and execute (under the seal of the Company or otherwise) all
assignments, transfers, conveyances, powers of attorney and other instruments
that may be necessary for the purpose of selling, assigning, transferring,
exchanging, converting or conveying or enforcing or exercising any voting
rights in respect of any such shares, bonds, debentures, rights, warrants or
other securities.
Where the Company has only one director and officer, being the same
person, that person may perform the functions and exercise the powers
contemplated by this paragraph.
The signature or signatures of any officer or director of the Company
and/or of any other officer or officers, person or persons appointed as
aforesaid by resolution of the board of directors may, if specifically
authorized by resolution of the board of directors, be printed, engraved,
lithographed or otherwise mechanically reproduced upon all contracts, documents
or instruments in writing or bonds, debentures or other securities of the
Company executed or issued by or on behalf of the Company.
All contracts, documents or instruments in writing or bonds,
debentures or other securities of the Company on which the signatures of any of
the foregoing officers, directors or persons shall be so reproduced, shall be
deemed to have been duly signed by such officers, and as valid to all intents
and purposes as if they had been signed manually. These documents are valid
notwithstanding that any of the officers, directors or persons whose signature
is or are so reproduced may have ceased to hold office at the date of the
delivery or issue of such contracts, documents or instruments in writing or
bonds, debentures or other securities of the Company.
ARTICLE SEVENTEEN
DECLARATIONS
SECTION 17.01 The chairman of the board, if any, the president of the Company,
any vice-president, secretary and/or treasurer, the assistant-secretaries
and/or assistant-treasurers, comptroller, accountant, chief clerk, or any other
officer or person authorized by an officer of the Company, is authorized and
empowered to appear and make answer for the Company to all writs, orders and
interrogatories upon articulated facts issued out of any court, to declare for
and on behalf of the Company any answer to writs of attachment by way of
garnishment in which the Company is garnishee, to make all affidavits and sworn
declarations in connection therewith or in connection with any or all judicial
proceedings to which the Company is a party, to make demands of abandonment or
petitions for winding up or bankruptcy orders upon any debtor of the Company,
to attend and vote at all meetings of creditors of any of the Company's debtors
and grant proxies in connection therewith, and to generally do all such things
in respect thereof as he deems to be in the best interests of the Company.
ARTICLE EIGHTEEN
AMENDMENTS TO BY-LAWS
SECTION 18.01 The board of directors may from time to time repeal, amend, or
re-enact the by-laws of the Company, but every such by-law, (except by-laws
respecting agents, officers and servants of the Company, and except such by-
laws which require, under the provisions of the Act, to be approved or
sanctioned by the shareholders before coming into effect) and every repeal,
amendment or re-enactment thereof unless in the meantime confirmed at a meeting
of the shareholders of the Company duly called for that purpose, shall have
force only until the next annual meeting of shareholders of the Company, and in
default of confirmation thereat, shall, at and from that time only, cease to
be in force.
ARTICLE NINETEEN
BORROWING OF MONEY BY THE COMPANY
SECTION 19.01 The directors of the Company may from time to time:
(a) borrow money upon the credit of the Company;
(b) issue debentures or other securities of the Company, and pledge or
sell the same for such sums and at such prices as may be deemed
expedient;
(c) hypothecate the immovable and movable property or otherwise affect
the movable property of the Company.
The limitations and restrictions contained in this section shall not
apply to the borrowing of money by the Company on bills of exchange or
promissory notes made, drawn, accepted or endorsed by or on behalf of the
Company.
SECTION 19.02 DELEGATION. The board may from time to time delegate to such
one or more of the directors and officers of the Company as may be designated
by the board all or any of the powers conferred on the board by section 19.01
or by the Act to such extent and in such manner as the board shall determine at
the time of each such delegation.
The powers hereby confirmed by this paragraph and the preceding
paragraph shall be deemed to be in supplement to and not in substitution for
any other borrowing powers which may otherwise be conferred on the directors or
officers of the Company independently of such paragraphs.
ARTICLE TWENTY
SPECIAL POWERS OF DIRECTORS
SECTION 20.01 The board of directors of the Company may from time to time
purchase, lease or otherwise acquire, alienate, sell, exchange or otherwise
dispose of stock, rights, warrants, options, debentures, lands, buildings, and
other property, moveable and immoveable, and grant any right or privilege on
the property of the Company for such considerations and upon such terms and
conditions as they may deem advisable. Without limiting the generality of the
foregoing, by this article the directors expressly authorize the Company to
utilize, in whole or in part, its funds for the purchase of shares of other
companies.
ENACTED ON MARCH 31, 1994.
CONFIRMED ON MARCH 31, 1994.
T. L. Hammond
T. L. Hammond
President
D. Michael Jones
D. Michael Jones
Secretary
BY-LAW TWO
being a by-law authorizing the Company to file articles of amendment with
the Inspecteur general des institutions financieres, in order to obtain a
certificate of amendment changing the corporate name of the Company and
deleting the limitations on the public distribution of the Company's
securities, such change and deletion to become effective as of January 1, 1996:
1. THAT the Company file the articles of amendment with the
Inspecteur general des institutions financieres, in order to obtain a
certificate of amendment changing its corporate name from "Systemes
Graphiques Southern-Canada, Ltee/Southern Graphic Systems-Canada, Ltd." to
"Societe Canadienne de Metaux Reynolds, Ltee/Canadian Reynolds Metals
Company, Ltd." and deleting the limitations on the public distribution of
the Company's securities set forth in Section 8 of its Articles of
Incorporation, such change and deletion to become effective as of January
1, 1996; and
2. THAT any one of the directors of the Company be and he/she is
hereby authorized to do all things and sign all documents and forms
necessary or incidental for the due carrying out of the foregoing.
EXHIBIT 4.18
FIRST SUPPLEMENTAL INDENTURE
FIRST SUPPLEMENTAL INDENTURE, dated as of December 18, 1995, among
CANADIAN REYNOLDS METALS COMPANY, LIMITED-SOCIETE CANADIENNE DE METAUX
REYNOLDS, LIMITEE, a company duly organized and existing under the laws of the
Province of Quebec, Canada (whose name effective January 1, 1996 will be
changed to "Reynolds Aluminum Company of Canada, Ltd.-Societe d'Aluminium
Reynolds du Canada, Ltee") (the "Company"), REYNOLDS METALS COMPANY, a
corporation duly organized and existing under the laws of the State of Delaware
(the "Guarantor"), THE BANK OF NEW YORK, a New York banking corporation, as
Trustee (the "Trustee"), and SOUTHERN GRAPHIC SYSTEMS-CANADA, LTD./SYSTEMES
GRAPHIQUES SOUTHERN-CANADA, LTEE, a company duly organized and existing under
the laws of the Province of Quebec, Canada (whose name effective January 1,
1996 will be changed to "Canadian Reynolds Metals Company, Ltd./Societe
Canadienne de Metaux Reynolds, Ltee") ("New Company").
WITNESSETH:
WHEREAS, the Company, the Guarantor and the Trustee are parties to an
Indenture, dated as of April 1, 1993 (the "Indenture"), providing for the
issuance from time to time of the Company's unsecured debentures, notes or
other evidences of indebtedness (the "Securities") in one or more series and
the guarantees of the Guarantor with respect to the Securities;
WHEREAS, at the date hereof, U.S. $285,000,000 aggregate principal amount
of Securities designated the "6-5/8% Guaranteed Amortizing Notes due July 15,
2002" (the "Notes") are the only series of Securities issued and outstanding
under the Indenture;
WHEREAS, the Notes are fully and unconditionally guaranteed as to payment
of principal and interest by the Guarantor (the "Guarantees");
WHEREAS, Section 803 of the Indenture permits any Subsidiary of the
Guarantor to assume the obligations of the Company with respect to the
Securities and under the Indenture, subject to compliance with the conditions
set forth in Section 803;
WHEREAS, Section 803 of the Indenture further provides that upon any such
assumption by a Subsidiary of the Guarantor, such Subsidiary shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under the Indenture with the same effect as if such Subsidiary had been named
as the "Company" in the Indenture, and the Company shall be released from its
liability as obligor upon the Securities;
WHEREAS, in connection with a restructuring of the Canadian operations of
the Guarantor, New Company, being a Subsidiary of the Guarantor, desires to
assume the obligations of the Company under the Indenture and with respect to
the Notes;
WHEREAS, the Company desires to remain as an obligor under the Indenture
and with respect to the Notes notwithstanding the assumption by New Company of
the Company's obligations thereunder;
WHEREAS, the Guarantor desires to confirm that the Guarantees shall apply
to New Company's obligations under the Indenture and with respect to the Notes
and shall continue to apply to the Company's obligations under the Indenture
and with respect to the Notes; and
WHEREAS, Section 901 of the Indenture provides that the Company, the
Guarantor and the Trustee may, without the consent of any Holders, enter into
one or more supplemental indentures to the Indenture, in form satisfactory to
the Trustee, (1) to evidence the assumption by any Person of the covenants of
the Company in the Indenture and in the Securities and (2) to add to the
covenants of the Company for the benefit of the Holders or to surrender any
right or power conferred upon the Company.
NOW, THEREFORE, for good and valuable consideration, the sufficiency and
receipt of which are hereby acknowledged, the parties, intending to be legally
bound, agree as follows:
Section 1. Confirmation of the Indenture; Definitions. Except as amended
and supplemented hereby, the Indenture is hereby confirmed and reaffirmed in
all particulars. Without limiting the generality of the foregoing, all
representations, covenants, agreements, obligations and rights contained in the
Indenture or herein and all security for the same are and shall be for the
equal and proportionate benefit and security of the Holders of all Securities
issued and outstanding under the Indenture, as amended hereby. Anything in the
Indenture or herein to the contrary notwithstanding, all recitals, definitions
and provisions contained in this First Supplemental Indenture shall take
precedence over the recitals, definitions and provisions of the Indenture to
the extent of any conflict between the two. Unless otherwise defined herein,
terms defined in the Indenture and used herein shall have the meanings given to
them in the Indenture.
Section 2. Amendment to Section 803. The last paragraph of Section 803
of the Indenture is hereby amended and restated in its entirety to read as
follows:
"Upon any such assumption, the Guarantor or such Subsidiary shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if the Guarantor or
such Subsidiary had been named as the "Company" herein, and the Person named as
the "Company" in the first paragraph of this instrument or any successor Person
which shall theretofore have become such in the manner prescribed in this
Article shall be released from its liability as obligor upon the Securities,
unless (i) such Person expressly agrees to remain as an obligor upon the
Securities and under this Indenture and (ii) the Guarantor expressly confirms
that its Guarantees shall continue to apply to such Person's obligations under
the Securities and this Indenture notwithstanding the assumption by the
Guarantor or such Subsidiary of such Person's obligations."
Section 3. Assumption by New Company of Company's Obligations. Pursuant
to Section 803 of the Indenture, as amended hereby, New Company, being a
Subsidiary of the Guarantor, hereby assumes the obligations of the Company for
the due and punctual payment of the principal of (and premium, if any),
interest, if any, on and any other payments with respect to the Notes and the
performance of every covenant of the Indenture and the Notes on the part of the
Company to be performed and observed.
Section 4. Agreement by Company to Remain as Obligor. Notwithstanding the
assumption by New Company of the Company's obligations under the Notes and the
Indenture, as amended hereby, as provided in Section 3 hereof, the Company
hereby expressly agrees to remain as an obligor upon the Notes and under the
Indenture, as amended hereby, and not to be released from its liability with
respect thereto.
Section 5. Confirmation by Guarantor of Guarantees. The Guarantor hereby
confirms that its Guarantees shall apply to (i) New Company's obligations under
the Notes and the Indenture, as amended hereby, and (ii) the Company's
obligations under the Notes and the Indenture, as amended hereby,
notwithstanding the assumption by New Company of the Company's obligations
thereunder.
Section 6. Subsidiary; Place of Incorporation. New Company hereby
confirms that it is a Subsidiary of the Guarantor and is incorporated under the
laws of the Province of Quebec, Canada.
Section 7. Payment of Additional Amounts. Without limiting the
generality of Section 3 of this First Supplemental Indenture, New Company
hereby expressly agrees that Section 1007 of the Indenture, as amended hereby,
relating to the payment of Additional Amounts with respect to Canadian non-
resident withholding taxes shall apply to and be binding upon it by virtue of
its assumption of the obligations of the Company under the Notes and the
Indenture, as amended hereby, as though said Section were fully recited herein
and with the same effect as if New Company had been named as the "Company"
therein.
Section 8. Conditions to Effectiveness. This First Supplemental
Indenture shall become effective on January 1, 1996, subject to the
satisfaction of the following conditions precedent:
(i) No Event of Default. Immediately after giving effect to the
transactions contemplated herein, no Event of Default, and no event which,
after notice or lapse of time or both, would become an Event of Default, shall
have occurred and be continuing.
(ii) Officers' Certificates and Opinions of Counsel. The
Company, the Guarantor and New Company shall each have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel pursuant to Section 803 of
the Indenture, as amended hereby, stating that: (I) (a) the assumption by New
Company of the obligations of the Company under the Notes and the Indenture, as
amended hereby, (b) the agreement of the Company to remain as an obligor upon
the Notes and under the Indenture, as amended hereby, (c) the confirmation by
the Guarantor that its Guarantees will apply to New Company's obligations under
the Notes and the Indenture, as amended hereby, (d) the confirmation by the
Guarantor that its Guarantees will continue to apply to the Company's
obligations under the Notes and the Indenture, as amended hereby, and (e) this
First Supplemental Indenture, comply with Article Eight of the Indenture, as
amended hereby; and (II) all conditions precedent set forth in the Indenture,
as amended hereby, relating to the foregoing have been complied with; and such
Opinions of Counsel shall further state, in accordance with Section 903 of the
Indenture, as amended hereby, that the execution of this First Supplemental
Indenture is authorized or permitted by the Indenture, as amended hereby.
(iii) Board Resolutions. The Company, the Guarantor and New
Company shall each have delivered to the Trustee a copy of a Board Resolution,
certified by its Secretary or an Assistant Secretary, duly adopted by its Board
of Directors, authorizing the transactions contemplated by, and the execution
and delivery of, this First Supplemental Indenture.
Section 9. Counterparts. This First Supplemental Indenture may be
executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
Section 10. Governing Law. This First Supplemental Indenture shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to principles of conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed, all as of the date first above written.
CANADIAN REYNOLDS METALS COMPANY,
LIMITED-SOCIETE CANADIENNE DE
METAUX REYNOLDS, LIMITEE
ATTEST:
Brenda A. Hart By Julian H. Taylor
Assistant Secretary Title: Vice President, Finance
[SEAL]
REYNOLDS METALS COMPANY
ATTEST:
Brenda A. Hart By Julian H. Taylor
Assistant Secretary Title: Vice President, Treasurer
[SEAL]
SOUTHERN GRAPHIC SYSTEMS-CANADA,
LTD./SYSTEMES GRAPHIQUES SOUTHERN-
CANADA, LTEE
ATTEST:
Brenda A. Hart By Julian H. Taylor
Assistant Secretary Title: Vice President, Treasurer
[SEAL]
THE BANK OF NEW YORK
ATTEST:
Marie E. Trimboli By Nancy Gill
Nancy Gill
Title: Assistant Treasurer
[SEAL]
COMMONWEALTH OF VIRGINIA )
) ss:
COUNTY OF HENRICO )
On the 18th day of December, 1995, before me personally came Julian H.
Taylor to me known, who, being by me duly sworn, did depose and say that he is
Vice President, Finance of Canadian Reynolds Metals Company, Limited--Societe
Canadienne de Metaux Reynolds, Limitee, one of the corporations described in
and which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
[SEAL]
Elizabeth B. Richardson
My commission expires September 30, 1997
COMMONWEALTH OF VIRGINIA )
) ss:
COUNTY OF HENRICO )
On the 18th day of December, 1995, before me personally came Julian H.
Taylor to me known, who, being by me duly sworn, did depose and say that he is
Vice President, Treasurer of Reynolds Metals Company, one of the corporations
described in and which executed the foregoing instrument; that he knows the
seal of said corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of Directors
of said corporation, and that he signed his name thereto by like authority.
[SEAL]
Elizabeth B. Richardson
My commission expires September 30, 1997
COMMONWEALTH OF VIRGINIA )
) ss:
COUNTY OF HENRICO )
On the 18th day of December, 1995, before me personally came Julian H.
Taylor to me known, who, being by me duly sworn, did depose and say that he is
Vice President, Treasurer of Southern Graphic Systems-Canada, Ltd./Systemes
Graphiques Southern-Canada, Ltee, one of the corporations described in and
which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
[SEAL]
Elizabeth B. Richardson
My commission expires September 30, 1997
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On the 20th day of December, 1995, before me personally came Nancy Gill to
me known, who, being by me duly sworn, did depose and say that he is Assistant
Treasurer of The Bank of New York, one of the corporations described in and
which executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
[SEAL]
William J. Cassels
William J. Cassels
Notary Public, State of New York
No. 01CA5027729
Qualified in Bronx County
Certificate Filed in New York County
Commission Expires May 16,
EXHIBIT 11
REYNOLDS METALS COMPANY AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
(In millions, except share data)
EARNINGS PER SHARE:
For 1995, earnings per share equals net income divided by the weighted-average
number of common shares and common share equivalents outstanding during the
year. The number of common share equivalents outstanding was based on the
assumed conversion of the Company's preferred stock ("PRIDES"). For the
purpose of this computation, the conversion rate shown below, which refers to
the number of shares of common stock to be received for each share of PRIDES,
was based on the average market value of the Company's common stock during the
year (also shown below). For 1994, earnings per share equals net income, minus
PRIDES dividends, divided by the weighted-average number of common shares
outstanding during the year. Common share equivalents relating to the PRIDES
were not included in 1994 since their effect would have been anti-dilutive, nor
in 1993 since the PRIDES were not issued until January 25, 1994. For 1993,
earnings per share equals net income divided by the weighted-average number of
common shares outstanding during the year.
<PAGE>
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
- -----------------------------------------------
1995 1994 1993
- -----------------------------------------------
<S> <C> <C> <C>
Weighted-average shares outstanding:
Common shares 63,051,000 61,756,000
59,850,000
Common share equivalents 9,704,000 - -
- -----------------------------------------------
Total 72,755,000 61,756,000
59,850,000
===============================================
Net income (loss) $389 $122
$(322)
Less preferred stock dividends - 34
- -
- -----------------------------------------------
$389 $88
$(322)
===============================================
Earnings per share $5.35 $1.42
$(5.38)
===============================================
Conversion rate 0.88 -
- -
Average market value of common stock $53.56 -
- -
</TABLE>
<PAGE>
EARNINGS PER SHARE (FULLY DILUTED):
Earnings per share (fully diluted) equals net income divided by the
weighted-average number of common shares and common share equivalents
outstanding during the year. The number of common share equivalents
outstanding was based on the maximum potential issuance of common shares upon
conversion of PRIDES, which is one share of common for each share of PRIDES.
This computation was made for presentation purposes only since its effect was
not material in 1995, was anti-dilutive in 1994 and was not applicable in 1993.
The difference between the number of common share equivalents for the years
ended December 31, 1995 and 1994 is due to the PRIDES having been issued on
January 25, 1994.
<PAGE>
YEARS ENDED DECEMBER 31
- ------------------------------------------------
1995 1994 1993
- ------------------------------------------------
Weighted-average shares outstanding:
Common shares 63,051,000 61,756,000
59,850,000
Common share equivalents 11,000,000 10,277,000 -
- ------------------------------------------------
Total 74,051,000 72,033,000
59,850,000
================================================
Net income (loss) $389 $122
$(322)
================================================
Earnings per share (fully diluted) $5.26 $1.69
$(5.38)
================================================
EXHIBIT 21
PARENTS AND SUBSIDIARIES
(A) Reynolds Metals Company has no parents.
(B) Set forth below is a list of certain of the subsidiaries and associated
companies of Reynolds Metals Company:
Place of
Incorporation Or
Organization
------------
Aluminerie de Becancour Inc. Quebec
* Aluminio Reynolds de Venezuela, S. A. Venezuela
Aluminium Oxid Stade Gesellschaft mit beschrankter Haftung Germany
* Canadian Reynolds Metals Company, Ltd./Societe Canadienne
de Metaux Reynolds, Ltee Quebec
* El Campo Aluminum Company Delaware
Hamburger Aluminium-Werk Gesellschaft mit beschrankter
Haftung Germany
* Industria Navarra del Aluminio, S. A. Spain
* Latas de Aluminio Reynolds, Inc. Delaware
Latas de Aluminio, S. A. Brazil
Manicouagan Power Company - La Compagnie Hydroelectrique
Manicouagan Quebec
* Mt. Vernon Plastics Corporation Delaware
Pechiney Reynolds Quebec, Inc. Nebraska
* Presidential Development Corporation New York
* RAMCO Manufacturing Company Delaware
* RB Sales Company, Ltd. Delaware
* Reynolds Aluminium Deutschland, Inc. Delaware
* Reynolds Aluminium Deutschland Internationale
Vertriebsgesellschaft mbH Germany
* Reynolds Aluminium France, S.A. France
* Reynolds Aluminium Holland B. V. The Netherlands
* Reynolds Aluminum Company of Canada, Ltd./Societe
D'Aluminium Reynolds Du Canada, Ltee Quebec
* Reynolds Australia Alumina, Ltd. Delaware
* Reynolds Becancour, Inc. Delaware
* Reynolds Consumer Europe, S. A./N.V. Belgium
* Reynolds Consumer Products, Inc. Delaware
* Reynolds (Europe) Limited Delaware
* Reynolds International Holdings, Inc. Delaware
* Reynolds International, Inc. Delaware
* Reynolds International (Panama) Inc. Panama
* Reynolds Italy Holding, S.p.A Italy
* Reynolds Wheels-Holding, S.p.A. Italy
* Reywest Development Corporation Arizona
* RMC Delaware, Inc. Delaware
* RMC Properties, Ltd. Delaware
* RMC Texas, Inc. Delaware
* RMCC Company Delaware
* Reynolds Metals Development Company Delaware
* Reynolds Metals Foreign Sales Corporation Barbados
* Saint George Insurance Company Vermont
* Southeast Vinyl Company Delaware
* Southern Graphic Systems - Canada, Ltd./Systemes
Graphiques Southern - Canada, Ltee Quebec
* Southern Graphic Systems, Inc. Kentucky
* Southern Reclamation Company, Inc. Alabama
* Wilson Engraving Company, Inc. Texas
The names of a number of subsidiaries and associated companies have been
omitted because considered in the aggregate they would not constitute a
significant subsidiary.
* Consolidated subsidiaries
EXHIBIT 23
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the:
1. Registration Statement (Form S-8 No. 2-76789) pertaining to the Reynolds
Metals Company 1982 Nonqualified Stock Option Plan;
2. Registration Statement (Form S-8 No. 33-13822) pertaining to the Reynolds
Metals Company 1987 Nonqualified Stock Option Plan;
3. Registration Statement (Form S-8 No. 33-44400) pertaining to the Reynolds
Metals Company 1992 Nonqualified Stock Option Plan;
4. Registration Statement (Form S-8 No. 33-20498) pertaining to the Reynolds
Metals Company Savings and Investment Plan for Salaried Employees;
5. Registration Statement (Form S-3 No. 33-43443) pertaining to the shelf
registration of debt securities of Reynolds Metals Company;
6. Registration Statement (Form S-8 No. 33-66032) pertaining to the Reynolds
Metals Company Savings Plan for Hourly Employees;
7. Registration Statement (Form S-3 No. 33-51153) pertaining to the offer and
resale of shares of Reynolds Metals Company Common Stock by the Trustee of
the Reynolds Metals Company Pension Plans Master Trust;
8. Registration Statement (Form S-8 No. 33-53847) pertaining to the Employees
Savings Plan;
9. Registration Statement (Form S-8 No. 33-53851) pertaining to the Reynolds
Metals Company Restricted Stock Plan for Outside Directors;
10. Registration Statement (Form S-3 No. 33-59168) pertaining to the
registration of debt securities of Canadian Reynolds Metals Company Ltd.;
11. Registration Statement (Form S-3 No. 33-51631) pertaining to the
registration of convertible preferred stock of Reynolds Metals Company;
and
12. Registration Statement (Form S-8 No. 33-00929) pertaining to the Reynolds
Metals Company Performance Incentive Plan,
and in the related prospectuses of our report dated February 16, 1996, with
respect to the consolidated financial statements of Reynolds Metals Company
included in this Annual Report (Form 10-K) for the year ended December 31,
1995.
Ernst & Young LLP
Richmond, Virginia
March 1, 1996
EXHIBIT 24
1. Powers of Attorney from the following persons are attached:
Patricia C. Barron
William O. Bourke
John R. Hall
Robert L. Hintz
William H. Joyce
Mylle Bell Mangum
D. Larry Moore
James M. Ringler
Robert J. Vlasic
Joe B. Wyatt
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for her and in her name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
Patricia C. Barron
Patricia C. Barron
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
William O. Bourke
William O. Bourke
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
John R. Hall
John R. Hall
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
Robert L. Hintz
Robert L. Hintz
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
William H. Joyce
William H. Joyce
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for her and in her name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
Mylle Bell Mangum
Mylle Bell Mangum
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
D. Larry Moore
D. Larry Moore
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
James M. Ringler
James M. Ringler
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 17th day of April, 1996.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
Robert J. Vlasic
Robert J. Vlasic
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned hereby
constitutes and appoints D. Michael Jones and Brenda A. Hart, or either of
them, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities (including without limitation in any capacity on behalf
of Reynolds Metals Company (the "Company")), to
(i) Sign the Annual Report on Form 10-K of the Company for the
year ended December 31, 1995 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and all documents in connection therewith,
if any, with the Securities and Exchange Commission (the "SEC"), and to take
all such other action which they or either of them may consider necessary or
desirable in connection therewith, all in accordance with the Securities
Exchange Act of 1934, as amended; and
(ii) Sign any and all Registration Statements on Form S-8, or on
such other form as may be appropriate, for registration of up to 2,000,000
shares of the Company's common stock, without par value (the "Common Stock"),
to be offered and sold under the Reynolds Metals Company 1996 Nonqualified
Stock Option Plan, and any and all post-effective amendments to such
Registration Statements, and to file the same, with all exhibits thereto and
documents in connection therewith, with the SEC; and
(iii) Sign any and all post-effective amendments to the Company's
Registration Statements relating to (a) the offer and sale of interests in the
Reynolds Metals Company Savings and Investment Plan for Salaried Employees and
an indefinite number of shares of Common Stock in connection therewith; (b) the
offer and sale of up to 900,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Reynolds Metals Company Savings Plan for Hourly Employees;
(c) the offer and sale of up to 50,000 shares of Common Stock together with an
indeterminate amount of interests to be offered and sold in connection
therewith under the Employees Savings Plan; (d) the offer and sale of 1,200,000
shares of Common Stock under the Reynolds Metals Company 1982 Nonqualified
Stock Option Plan; (e) the offer and sale of 3,000,000 shares of Common Stock
under the Reynolds Metals Company 1987 Nonqualified Stock Option Plan; (f) the
offer and sale of 3,250,000 shares of Common Stock under the Reynolds Metals
Company 1992 Nonqualified Stock Option Plan; and (g) the offer and sale of
30,000 shares of Common Stock under the Reynolds Metals Company Restricted
Stock Plan for Outside Directors; and to file the same, with all exhibits
thereto, and all documents in connection therewith, with the SEC; and
(iv) Sign any and all Registration Statements on Form S-3, or on
such other form as may be appropriate, for registration of the shares of Common
Stock and Series A Junior Participating Preferred Stock (without par value) of
the Company, issuable upon exercise of Rights (as defined in the Rights
Agreement between the Company and The Chase Manhattan Bank, N.A., dated as of
November 23, 1987, as amended from time to time) and any and all amendments
(including post-effective amendments) to such Registration Statements, and to
file the same, with all exhibits thereto, and all preliminary prospectuses,
prospectuses, prospectus supplements and documents in connection therewith,
with the SEC; and
(v) Sign any and all post-effective amendments to the Company's
Registration Statements relating to the offer and sale of up to $1,650,000,000
principal amount of unsecured debt securities of the Company, and to file the
same, with all exhibits thereto, and all prospectuses, prospectus supplements,
pricing supplements and documents in connection therewith, with the SEC; and
(vi) Sign any and all post-effective amendments to the Company's
Registration Statement relating to the offer and resale from time to time of up
to 3,000,000 shares of Common Stock by the Trustee of the Reynolds Metals
Company Pension Plans Master Trust, and to file the same, with all exhibits
thereto, and all prospectuses, prospectus supplements, pricing supplements and
documents in connection therewith, with the SEC;
granting unto each of said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all intents and purposes as the undersigned
might or could do in person, hereby ratifying and confirming all that each of
said attorneys-in-fact and agents, or his or her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
This Power of Attorney shall expire on the 28th day of February,
1997.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Power of Attorney on the 16th day of February, 1996.
Joe B. Wyatt
Joe B. Wyatt
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Reynolds
Metals Company Consolidated Balance Sheet for December 31, 1995 and
Consolidated
Statement of Income and Retained Earnings for the Year Ended December 31, 1995
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 39
<SECURITIES> 00
<RECEIVABLES> 909
<ALLOWANCES> 20
<INVENTORY> 891
<CURRENT-ASSETS> 2014
<PP&E> 6600
<DEPRECIATION> 3377
<TOTAL-ASSETS> 7740
<CURRENT-LIABILITIES> 1367
<BONDS> 1853
0
505
<COMMON> 941
<OTHER-SE> 1171
<TOTAL-LIABILITY-AND-EQUITY> 7740
<SALES> 7213
<TOTAL-REVENUES> 7252
<CGS> 5772
<TOTAL-COSTS> 6083
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 172
<INCOME-PRETAX> 548
<INCOME-TAX> 159
<INCOME-CONTINUING> 389
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 389
<EPS-PRIMARY> 5.35
<EPS-DILUTED> 0
</TABLE>
