<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
August 5, 1999
Date of Report
(Date of earliest event reported)
--------------
DECRANE AIRCRAFT HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 333-70365 34-1645569
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
2361 ROSECRANS AVENUE, SUITE 180, EL SEGUNDO, CA 90245
(Address, including zip code, of principal executive offices)
(310) 725-9123
(Registrant's telephone number, including area code)
--------------
NOT APPLICABLE
(Former address and telephone number of principal executive offices, if changed
since last report)
--------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
EXPLANATORY NOTE
On August 6, 1999, DeCrane Aircraft Holdings, Inc. filed its Form 10-Q
for the quarter ended June 30, 1999. In Item 5 of that Form 10-Q, we
described our August 5, 1999 acquisition of Custom Woodwork & Plastics, Inc.
At the time of filing, the Regulation S-X compliant audited financial
statements of Custom Woodwork and the pro forma consolidated financial
information required by the Securities Exchange Act of 1934 were not
available. The purpose of this Form 8-K is to provide the required financial
statements and pro forma financial information.
In October 1998, we also acquired PCI NewCo, Inc. and International
Custom Interiors, Inc. Item 2 of this Form 8-K includes a description of
these acquisitions. The Regulation S-X compliant audited financial statements
and pro forma consolidated financial information required in Item 7 are not
available at this time and will be filed by amendment to this Form 8-K by no
later than December 20, 1999.
DOCUMENTS REFERRED TO IN THIS REPORT
DeCrane Aircraft has filed documents with the Securities and Exchange
Commission that we refer to in this report. The documents we refer to and the
information they contain are described below:
- - Our Registration Statement No. 333-70365 on Form S-1 effective May 14,
1999, and the prospectus it contains. The prospectus includes our audited
1998 financial statements, descriptions of previously completed
acquisitions and the DLJ acquisition, audited financial statements of
previously acquired companies and unaudited pro forma consolidated
financial information reflecting the previously acquired companies.
- - Our Form 10-Q for the quarter ended June 30, 1999. The Form 10-Q includes
our historical consolidated financial statements, updated information for
previously acquired companies and information on the Custom Woodwork's
acquisition.
You may read and copy any reports, statements or other information we
file at the SEC's reference room in Washington D.C. Please call the SEC at
(202) 942-8090 for further information on the operation of the reference
rooms. You can also request copies of these documents, upon payment of a
duplicating fee, by writing to the SEC, or review our SEC filings on the
SEC's EDGAR web site, which can be found at http:\\www.sec.gov. You may also
write or call us at our corporate office located at 2361 Rosecrans Avenue,
Suite 180, El Segundo, California 90245. Our telephone number is (310)
725-9123.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
ACQUISITION OF CUSTOM WOODWORK & PLASTICS, INC.
On August 5, 1999 we acquired substantially all of the assets, subject
to accounts payable and accrued expenses assumed, of Custom Woodwork &
Plastics, Inc. Custom Woodwork is a Georgia-based designer and manufacturer
of interior furniture components for middle- and high-end corporate aircraft.
We intend to continue to use the acquired assets to manufacture products
similar to those previously manufactured by Custom Woodwork.
The total purchase price was $13.8 million, including an estimated $0.5
million of acquisition related costs. The acquisition will be accounted for
as a purchase and the assets acquired and liabilities assumed will be
recorded at their estimated fair values. Based on historical values as of
June 30, 1999, it is estimated that the historical value of inventory will be
increased by $0.5 million and the $11.7 million difference between the
purchase price and the fair value of the net assets acquired will be recorded
as goodwill and amortized on a straight-line basis over thirty years. The
purchase price allocation is preliminary and may change upon the completion
of the final valuation of the net assets acquired. Our consolidated financial
statement will include Custom Woodwork's financial position and its results
of operations for periods subsequent to the acquisition date.
The acquisition was funded with borrowings under our senior credit
facility.
1
<PAGE>
ACQUISITION OF PCI NEWCO, INC.
On October 6, 1999 we acquired substantially all of the assets, subject
to accounts payable and accrued expenses assumed, of PCI NewCo, Inc. PCI
NewCo is a Kansas-based manufacturer of composite material and components for
middle- and high-end corporate aircraft. We intend to continue to use the
acquired assets to manufacture products similar to those previously
manufactured by PCI NewCo.
The total purchase price was $8.8 million, plus $1.5 million of
contingent consideration payable in 2000 based on future attainment of
defined performance criteria. The total purchase price includes an estimated
$0.3 million of acquisition related costs. The acquisition will be accounted
for as a purchase and the difference between the purchase price and the fair
value of the net assets acquired will be recorded as goodwill and amortized
on a straight-line basis over thirty years. The amount of contingent
consideration paid in the future, if any, will increase goodwill and will be
amortized prospectively over the remaining period of the initial thirty-year
term. Our consolidated financial statements will include PCI NewCo's
financial position and its results of operations for periods subsequent to
the acquisition date.
The acquisition was funded with borrowings under our senior credit
facility.
ACQUISITION OF INTERNATIONAL CUSTOM INTERIORS, INC.
On October 8, 1999 we acquired all of the common stock of International
Custom Interiors, Inc. Custom Interiors is a Florida-based provider of
upholstery services and manufacturer of furniture for middle- and high-end
corporate aircraft. We intend to continue to use the acquired assets to
manufacture products similar to those previously manufactured by Custom
Interiors.
The total purchase price was $3.2 million, including an estimated $0.4
million of acquisition related costs. The acquisition will be accounted for
as a purchase and the difference between the purchase price and the fair
value of the net assets acquired will be recorded as goodwill and amortized
on a straight-line basis over thirty years. Our consolidated financial
statements will include Custom Interiors' financial position and its results
of operations for periods subsequent to the acquisition date.
The acquisition was funded with borrowings under our senior credit
facility.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial statements of businesses acquired.
Audited financial statements of Custom Woodwork & Plastics, Inc.,
including related notes and independent accountants' report, are attached
hereto as follows:
<TABLE>
<CAPTION>
Page
------
<S> <C>
Report of Independent Accountants ......................................................................... F-1
Balance Sheets as of December 31, 1997 and 1998 and June 30, 1999 (unaudited) ............................. F-2
Statements of Income for the years ended December 31, 1997 and 1998 and
the six months ended June 30, 1998 and 1999 (unaudited) ................................................. F-3
Statements of Stockholders' Equity for years ended December 31, 1997 and 1998 and
the six months ended June 30, 1999 (unaudited) .......................................................... F-4
Statements of Cash Flows for the years ended December 31, 1997 and 1998 and
the six months ended June 30, 1998 and 1999 (unaudited) ................................................. F-5
Notes to the Financial Statements ......................................................................... F-6
</TABLE>
PCI NewCo, Inc. Regulation S-X compliant audited financial statements
are not available at this time. The audited financial statements for the
appropriate periods will be filed by amendment to this Form 8-K as soon as
practicable, but in no event later than December 20, 1999. Because
International Custom Interiors, Inc. does not constitute a significant
subsidiary, the filing of Regulation S-X compliant audited financial
statements is not required.
2
<PAGE>
(b) Pro forma financial information.
Unaudited pro forma financial information reflecting the Custom Woodwork &
Plastics, Inc. acquisition, including related explanatory notes, are attached
hereto as follows:
<TABLE>
<CAPTION>
Page
------
<S> <C>
Basis of Presentation ..................................................................................... P-1
Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 1998 ............. P-2
Unaudited Pro Forma Consolidated Statement of Operations for the six months ended June 30, 1999 ........... P-3
Unaudited Pro Forma Consolidated Balance Sheet as of June 30, 1999 ........................................ P-4
Notes to Unaudited Pro Forma Consolidated Financial Information ........................................... P-5
</TABLE>
Unaudited pro forma financial information reflecting the PCI NewCo, Inc.
and International Custom Interiors, Inc. acquisitions is not available at
this time. The pro forma financial information will be filed by amendment to
this Form 8-K as soon as practicable, but in no event later than December 20,
1999.
(c) Exhibits.
<TABLE>
<CAPTION>
Exhibit
No. Exhibit Description
------- ---------------------------------------------------------------------------------------------
<S> <C>
13.19.1 Articles of Incorporation of CWP Acquisition, Inc. *
13.19.2 By Laws of CWP Acquisition, Inc. *
13.20.1 Articles of Incorporation of PCI Acquisition Co., Inc. **
13.20.2 By Laws of PCI Acquisition Co., Inc. **
13.21.1 Articles of Incorporation of International Custom Interiors, Inc. **
13.21.2 By Laws of International Custom Interiors, Inc. **
20.1 Prospectus of DeCrane Aircraft Holdings, Inc. dated May 14, 1999 (incorporated by reference to
the Company's Registration Statement No. 333-70365 on Form S-1 effective May 14, 1999) *
21.1 List of Subsidiaries of Registrant **
</TABLE>
- --------------
* Previously filed
** Filed herewith
3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DECRANE AIRCRAFT HOLDINGS, INC.
(Registrant)
October 19, 1999 By: /s/ RICHARD J. KAPLAN
-------------------------------------
Name: Richard J. Kaplan
Title: Senior Vice President, Chief
Financial Officer,
Secretary and Treasurer
4
<PAGE>
FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
and Stockholders of
Custom Woodwork & Plastics, Inc.
In our opinion, the accompanying balance sheets and the related
statements of income, of stockholders' equity and of cash flows present
fairly, in all material respects, the financial position of Custom Woodwork &
Plastics, Inc. at December 31, 1997 and 1998 and the results of its
operations and its cash flows for the years then ended, in conformity with
generally accepted accounting principles. 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 of these statements in accordance with generally accepted auditing
standards which 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, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for the opinion expressed above.
PRICEWATERHOUSECOOPERS LLP
Los Angeles, California
October 1, 1999
F-1
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
------------------------ ------------
1997 1998 1999
----------- ----------- ------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets
Cash and cash equivalents ....................................................... $ 452 $ 776 $ 873
Trade accounts receivable ....................................................... 209 269 642
Inventories ..................................................................... 197 434 400
Note receivable ................................................................. 50 - -
----------- ----------- -----------
Total current assets .......................................................... 908 1,479 1,915
Property, plant and equipment, net ................................................. 737 793 731
----------- ----------- -----------
Total assets ................................................................ $ 1,645 $ 2,272 $ 2,646
----------- ----------- -----------
----------- ----------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Trade accounts payable .......................................................... $ 15 $ 95 $ 100
Accrued expenses and other liabilities........................................... 10 17 39
----------- ----------- -----------
Total current liabilities ..................................................... 25 112 139
----------- ----------- -----------
Commitments and contingencies (Note 8).............................................. - - -
----------- ----------- -----------
Stockholders' equity
Common stock, $1 par value, 50,000 shares authorized; 500 shares
issued and outstanding at December 31, 1997 and 1998 and June 30, 1999......... 1 1 1
Retained earnings ............................................................... 1,619 2,159 2,506
----------- ----------- -----------
Total stockholders' equity .................................................... 1,620 2,160 2,507
----------- ----------- -----------
Total liabilities and stockholders' equity .................................. $ 1,645 $ 2,272 $ 2,646
----------- ----------- -----------
----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-2
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
STATEMENTS OF INCOME
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
------------------------ ------------------------
1997 1998 1998 1999
----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C>
Sales ................................................................. $ 3,235 $ 4,480 $ 2,034 $ 4,002
Cost of sales ......................................................... 1,877 2,358 1,104 1,843
----------- ----------- ----------- -----------
Gross profit .......................................................... 1,358 2,122 930 2,159
Operating expenses
Selling, general and administrative ................................ 365 397 169 198
----------- ----------- ----------- -----------
Income from operations ................................................ 993 1,725 761 1,961
Other income
Interest income, net ............................................... 27 35 18 9
Other (expense) income, net ........................................ (5) 2 - -
----------- ----------- ----------- -----------
Net income ............................................................ $ 1,015 $ 1,762 $ 779 $ 1,970
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-3
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
COMMON STOCK
----------------------
NUMBER
OF RETAINED
SHARES AMOUNT EARNINGS TOTAL
--------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance, December 31, 1996 ............................................ 500 $ 1 $ 1,268 $ 1,269
Net income ......................................................... - - 1,015 1,015
Distributions to stockholders ...................................... - - (664) (664)
--------- ----------- ----------- -----------
Balance, December 31, 1997 ............................................ 500 1 1,619 1,620
Net income ......................................................... - - 1,762 1,762
Distributions to stockholders ...................................... - - (1,222) (1,222)
--------- ----------- ----------- -----------
Balance, December 31, 1998 ............................................ 500 1 2,159 2,160
Net income (Unaudited) ............................................. - - 1,970 1,970
Distributions to stockholders (Unaudited) .......................... - - (1,623) (1,623)
--------- ----------- ----------- -----------
Balance, June 30, 1999 (Unaudited) .................................... 500 $ 1 $ 2,506 $ 2,507
--------- ----------- ----------- -----------
--------- ----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-4
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
------------------------ ------------------------
1997 1998 1998 1999
----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C>
Cash flows from operating activities
Net income ......................................................... $ 1,015 $ 1,762 $ 779 $ 1,970
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation ................................................... 35 40 22 17
Changes in operating assets and liabilities
Trade accounts receivable ........................................ (209) (60) 158 (373)
Inventories ...................................................... 2 (237) 14 34
Trade accounts payable ........................................... - 80 33 5
Accrued expenses and other liabilities ........................... - 7 15 22
----------- ----------- ----------- -----------
Net cash provided by operating activities ...................... 843 1,592 1,021 1,675
----------- ----------- ----------- -----------
Cash flows from investing activities
Purchases of property, plant and equipment ......................... (38) (96) (64) -
(Issuance) payment of note receivable .............................. (50) 50 - -
----------- ----------- ----------- -----------
Net cash used for investing activities ......................... (88) (46) (64) -
----------- ----------- ----------- -----------
Cash flows from financing activities
Distributions paid to stockholders ................................. (664) (1,222) (322) (1,578)
----------- ----------- ----------- -----------
Net cash used for financing activities ......................... (664) (1,222) (322) (1,578)
----------- ----------- ----------- -----------
Net increase in cash and cash equivalents ............................. 91 324 635 97
Cash and cash equivalents at beginning of period ...................... 361 452 452 776
----------- ----------- ----------- -----------
Cash and cash equivalents at end of period ............................ $ 452 $ 776 $ 1,087 $ 873
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of the financial statements.
F-5
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - THE COMPANY
Custom Woodwork & Plastics, Inc. (the "Company") designs and
manufactures interior furniture components for middle- and high-end corporate
aircraft. The Company operates in the U.S. market and 100% and 74% of the
Company's sales for fiscal 1998 and 1997 were to Gulfstream Aerospace
Corporation, respectively. The Company's customers are principally
concentrated in the corporate aircraft industry.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid investments with an original
maturity of three months or less when purchased to be cash equivalents.
It is the policy of the Company to deposit its cash and cash equivalents
in federally insured financial institutions. From time to time deposits may
exceed Federal Deposit Insurance Corporation ("FDIC") limits. At December 31,
1998, the Company had $476,000 on deposit in excess of the FDIC limits.
INVENTORIES
Inventories are valued at the lower of cost or market, cost being
determined using the first-in, first-out (FIFO) method.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost less accumulated
depreciation. Major renewals and betterments are capitalized and ordinary
repairs and maintenance are charged against operations in the year incurred.
Depreciation is computed using the straight-line method for buildings and
building improvements and the double-declining balance method for machinery
and equipment, vehicles and furniture and fixtures. Estimated useful lives
are 40 years for buildings and building improvements and 5 to 7 years for
machinery and equipment, vehicles and furniture and fixtures.
REVENUE RECOGNITION
Revenue is recognized when products are shipped.
INCOME TAXES
The Company elected to have its income taxed as an S corporation under
provisions of the Internal Revenue Code; therefore, taxable income or loss is
reported to the individual stockholders for inclusion in their tax returns,
and no provision for Federal and state income tax is included in these
statements.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amounts of financial instruments including cash,
receivables, accounts payable and accrued expenses and other liabilities do
not significantly differ from fair values as of December 31, 1997 and 1998.
USE OF ESTIMATES
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 and
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.
F-6
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
UNAUDITED INTERIM RESULTS
The financial information as of June 30, 1999 and for the six months
ended June 30, 1998 and 1999 is unaudited. In the opinion of the Company, the
unaudited financial information is presented on a basis consistent with the
audited financial statements and contains all adjustments, consisting only of
normal recurring adjustments, necessary for a fair statement of the results
for such interim periods. The results of operations for the interim periods
are not necessarily indicative of results of operations for the full year.
NOTE 3 - INVENTORIES
Inventories consist of the following (amounts in thousands):
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
------------------------ ------------
1997 1998 1999
----------- ----------- ------------
(UNAUDITED)
<S> <C> <C> <C>
Raw material ....................................................................... $ 14 $ 24 $ 47
Work-in-process .................................................................... 183 410 353
----------- ----------- ------------
Total inventories ............................................................... $ 197 $ 434 $ 400
----------- ----------- ------------
----------- ----------- ------------
</TABLE>
NOTE 4 - PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consists of the following (amounts in
thousands):
<TABLE>
<CAPTION>
DECEMBER 31,
------------------------
1997 1998
----------- -----------
<S> <C> <C>
Land ............................................................................................ $ 75 $ 75
Buildings and building improvements ............................................................. 644 644
Machinery and equipment ......................................................................... 113 113
Vehicles ........................................................................................ 90 163
Furniture and fixtures .......................................................................... 16 16
----------- -----------
Total cost ................................................................................... 938 1,011
Accumulated depreciation and amortization .................................................... (201) (218)
----------- -----------
Net property and equipment ................................................................... $ 737 $ 793
----------- -----------
----------- -----------
</TABLE>
Depreciation expense for the years ended December 31, 1997 and 1998 was
$35,000 and $40,000, respectively.
NOTE 5 - LINE OF CREDIT
The Company had a $200,000 revolving line of credit with a bank,
collaterialized by all of the assets of the Company. Loans under the line of
credit bear interest at the rate of 8.75% per annum. All borrowings under the
line of credit were used for working capital purposes. The line of credit
matured in February 1999 and was not renewed. As of December 31, 1997 and
1998, the Company had no borrowings outstanding under the line of credit.
NOTE 6 - RELATED PARTY TRANSACTIONS
At December 31, 1997, the Company had a $50,000 note receivable from a
related party. The note was repaid in full in 1998.
F-7
<PAGE>
CUSTOM WOODWORK & PLASTICS, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 7 - EMPLOYEE BENEFIT PLANS
The Company has a savings and retirement plan which qualifies under
Section 401(k) of the Internal Revenue Code in which all full-time employees
are eligible to participate. In accordance with the terms of the plan,
employees may elect to contribute up to 15% of their annual compensation to
the plan, subject to certain limitations. The Board of Directors may elect to
declare a discretionary matching contribution to the Plan of 50% of all
contributions made up to 6% of each employee's salary. The Company did not
make any matching contributions for 1997 or 1998.
NOTE 8 - COMMITMENT AND CONTINGENCIES
The Company is involved in routine legal and administrative proceedings
incidental to the normal conduct of business. Management believes the
ultimate disposition of these matters will not have a material adverse effect
on the Company's financial position, results of operations or cash flows.
NOTE 9 - SUBSEQUENT EVENT
In August 1999, substantially all of the Company's net assets were
acquired by DeCrane Aircraft Holdings, Inc. for a purchase price of $13.3
million.
F-8
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
BASIS OF PRESENTATION
The following unaudited pro forma consolidated financial information for
DeCrane Aircraft is based on its historical financial statements adjusted to
reflect the 1998 Avtech, Dettmers and DLJ acquisitions and the 1999 PATS, PPI
and Custom Woodwork acquisitions. For additional information on the 1998
Avtech, Dettmers and DLJ acquisitions, see the notes to DeCrane Aircraft's
1998 consolidated financial statements included in the prospectus. For
additional information on the 1999 PATS, PPI and Custom Woodwork
acquisitions, see the notes to DeCrane Aircraft's Form 10-Q.
Unaudited pro forma consolidated statements of operations are presented
for the year ended December 31, 1998 and the six months ended June 30, 1999.
The statements reflect the acquisitions as if they had occurred as of January
1, 1998. The unaudited pro forma consolidated balance sheet reflects the
Custom Woodwork acquisition as of June 30, 1999; all of the 1998 acquisitions
and the 1999 PATS and PPI acquisitions had occurred by that date and are
therefore reflected in the historical balance sheet.
The pro forma adjustments are based upon available information and
assumptions management believes are reasonable under the circumstances. The
unaudited pro forma consolidated financial information and accompanying notes
should be read in conjunction with the historical financial statements and
related notes of:
- - DeCrane Aircraft included in the prospectus and Form 10-Q;
- - Avtech, PATS and PPI included in the prospectus; and
- - Custom Woodwork included in this Form 8-K.
The pro forma financial information does not purport to represent what
DeCrane Aircraft's actual results of operations or actual financial position
would have been if the transactions described above in fact occurred on such
dates or to project DeCrane Aircraft's results of operations or financial
position for any future period or date.
P-1
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
COMPANIES ACQUIRED (2)
DECRANE AIRCRAFT -------------------------------------------------
HISTORICAL (1) PREVIOUSLY
----------------------- REPORTED CUSTOM
PREDECESSOR SUCCESSOR ACQUISITIONS (3) WOODWORK (4) ADJUSTMENTS PRO FORMA
----------- ----------- ---------------- ------------ ----------------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
Revenues ............................. $ 90,077 $ 60,356 $ 94,059 $ 4,480 $ (133) (5) $ 248,839
Cost of sales ........................ 60,101 42,739 63,418 2,358 755 (6) 169,371
----------- ----------- ------------ ------------ ----------- -----------
Gross profit ......................... 29,976 17,617 30,641 2,122 (888) 79,468
Selling, general and administrative
expenses .......................... 15,719 10,274 11,579 397 (1,728) (7) 36,241
Nonrecurring acquisition expenses .... 3,632 - 1,479 - (5,111) (8) -
Nonrecurring bonuses and
employment contract
termination expenses .............. - - 4,072 - (4,072) (9) -
ESOP contribution .................... - - 530 - (530) (10) -
Amortization of intangible assets .... 1,347 3,148 328 - 7,893 (11) 12,716
----------- ----------- ------------ ------------ ----------- -----------
Operating income .................... 9,278 4,195 12,653 1,725 2,660 30,511
Interest expense (income) ............ 2,350 6,852 1,345 (35) 20,371 (12) 30,883
Other expenses (income) .............. 847 335 (30) (2) (600) (13) 550
----------- ----------- ------------ ------------ ----------- -----------
Income (loss) before provision for
income taxes and extraordinary
item .............................. 6,081 (2,992) 11,338 1,762 (17,111) (922)
Provision for income taxes (benefit) . 2,892 (2,668) 691 - 1,098 (14) 2,013
----------- ----------- ------------ ------------ ----------- -----------
Income (loss) before extraordinary
item (15) ......................... $ 3,189 $ (324) $ 10,647 $ 1,762 $ (18,209) $ (2,935)
----------- ----------- ------------ ------------ ----------- -----------
----------- ----------- ------------ ------------ ----------- -----------
See accompanying notes to the Unaudited Pro Forma Consolidated Financial Information.
</TABLE>
P-2
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
COMPANIES ACQUIRED (2)
DECRANE --------------------------------------------------
AIRCRAFT PREVIOUSLY
HISTORICAL REPORTED CUSTOM
(SUCCESSOR) (1) ACQUISITIONS (3) WOODWORK (4) ADJUSTMENTS PRO FORMA
--------------- ---------------- ------------ ----------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Revenues .......................................... $ 112,598 $ 13,208 $ 4,002 $ - $ 129,808
Cost of sales ..................................... 75,974 9,664 1,843 (1,093) (6) 86,388
----------- ----------- ---------- --------- ---------
Gross profit ...................................... 36,624 3,544 2,159 1,093 43,420
Selling, general and administrative expenses ...... 17,250 1,235 198 - 18,683
Nonrecurring acquisition expenses ................. - 200 - (200) (8) -
Nonrecurring bonuses and employment contract
termination expenses ........................... - 120 - (120) (9) -
Amortization of intangible assets ................. 5,458 124 - 746 (11) 6,328
----------- ----------- ---------- --------- ---------
Operating income ................................. 13,916 1,865 1,961 667 18,409
Interest expense (income) ......................... 12,729 150 (9) 1,588 (12) 14,458
Other income ...................................... (367) (22) - - (389)
----------- ----------- ---------- --------- ---------
Income (loss) before provision for
income taxes and extraordinary item ............ 1,554 1,737 1,970 (921) 4,340
Provision for income taxes (benefit) .............. 1,737 (1,244) - 2,504 (14) 2,997
----------- ----------- ---------- --------- ---------
Income (loss) before extraordinary item ........... $ (183) $ 2,981 $ 1,970 $ (3,425) $ 1,343
----------- ----------- ---------- --------- ---------
----------- ----------- ---------- --------- ---------
See accompanying notes to the Unaudited Pro Forma Consolidated Financial Information.
</TABLE>
P-3
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
JUNE 30, 1999
<TABLE>
<CAPTION>
COMPANY ACQUIRED (18)
DECRANE -----------------------------------
AIRCRAFT CUSTOM
HISTORICAL WOODWORK
(SUCCESSOR) (17) HISTORICAL (19) ADJUSTMENTS PRO FORMA
---------------- --------------- ---------------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
ASSETS
Current assets
Cash and cash equivalents ................................... $ 3,489 $ 873 $ (873) (20) $ 3,489
Accounts receivable, net .................................... 43,786 642 - 44,428
Inventories ................................................. 49,323 400 513 (21) 50,236
Deferred income taxes ....................................... 3,630 - - 3,630
Prepaid expenses and other current assets ................... 3,186 - - 3,186
----------- ----------- -------- ----------
Total current assets ...................................... 103,414 1,915 (360) 104,969
----------- ----------- -------- ----------
Property and equipment, net .................................... 35,670 731 - 36,401
----------- ----------- -------- ----------
Other assets, principally intangibles, net
Goodwill and other intangibles .............................. 295,847 - 11,668 (22) 307,515
Deferred financing costs .................................... 11,131 - - 11,131
Other assets ................................................ 713 - - 713
----------- ----------- -------- ----------
Net other assets, principally intangibles ................. 307,691 - 11,668 319,359
----------- ----------- -------- ----------
Total assets .......................................... $ 446,775 $ 2,646 $ 11,308 $ 460,729
----------- ----------- -------- ----------
----------- ----------- -------- ----------
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities
Short-term borrowings ....................................... $ 489 $ - $ - $ 489
Current portion of long-term obligations .................... 3,368 - - 3,368
Accounts payable ............................................ 9,308 100 - 9,408
Accrued expenses ............................................ 26,934 39 - 26,973
Income taxes payable ........................................ 5,107 - - 5,107
----------- ----------- -------- ----------
Total current liabilities ................................. 45,206 139 - 45,345
----------- ----------- -------- ----------
Long-term obligations
Senior revolving credit facility ............................ 3,000 - 13,815 (23) 16,815
Senior term facility ........................................ 166,725 - - 166,725
Senior subordinated notes ................................... 100,000 - - 100,000
Other long-term obligations ................................. 1,783 - - 1,783
----------- ----------- -------- ----------
Total long-term obligations ............................... 271,508 - 13,815 285,323
Deferred income taxes .......................................... 16,418 - - 16,418
Other long-term liabilities .................................... 4,815 - - 4,815
----------- ----------- -------- ----------
Total long-term liabilities ............................. 292,741 - 13,815 306,556
----------- ----------- -------- ----------
Stockholder's equity ........................................... 108,828 2,507 (2,507) (24) 108,828
----------- ----------- -------- ----------
Total liabilities and stockholder's equity ............ $ 446,775 $ 2,646 $ 11,308 $ 460,729
----------- ----------- -------- ----------
----------- ----------- -------- ----------
See accompanying notes to the Unaudited Pro Forma Consolidated Financial Information.
</TABLE>
P-4
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
(1) For the year ended December 31, 1998, reflects DeCrane Aircraft's
historical results of operations for the eight months ended August 31,
1998 prior to the DLJ acquisition (predecessor) and the four months ended
December 31, 1998 subsequent to the DLJ acquisition (successor). For the
six months ended June 30, 1999, reflects DeCrane Aircraft's historical
results of operations subsequent to the DLJ acquisition (successor).
(2) Reflects the results of operations for companies acquired and DLJ
acquisition adjustments for the periods not included in the historical
columns.
(3) Reflects the results of operations of companies acquired and previously
reported in our prospectus as follows (dollars in thousands):
<TABLE>
<CAPTION>
AVTECH (a) DETTMERS (b) PATS (c) PPI (d) TOTAL
----------- ------------ ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1998
Revenues .......................................... $ 20,984 $ 2,013 $ 33,348 $ 37,714 $ 94,059
Cost of sales ..................................... 13,267 1,454 24,321 24,376 63,418
----------- ----------- ----------- ----------- -----------
Gross profit ...................................... 7,717 559 9,027 13,338 30,641
Selling, general and administrative expenses ...... 3,695 760 4,906 2,218 11,579
Nonrecurring acquisition expenses ................. 1,229 - 250 - 1,479
Nonrecurring bonuses and employment
contract termination expenses ................... 3,592 - 480 - 4,072
ESOP contribution ................................. 300 - 230 - 530
Amortization of intangible assets ................. - - - 328 328
----------- ----------- ----------- ----------- -----------
Operating income (loss) ........................... (1,099) (201) 3,161 10,792 12,653
Interest expense (income) ......................... (60) 13 296 1,096 1,345
Other expenses (income) ........................... (35) - - 5 (30)
----------- ----------- ----------- ----------- -----------
Income (loss) before provision for
income taxes and extraordinary item ............. (1,004) (214) 2,865 9,691 11,338
Provision for income taxes (benefit) .............. (322) - 1,013 - 691
----------- ----------- ----------- ----------- -----------
Income (loss) before extraordinary item ........... $ (682) $ (214) $ 1,852 $ 9,691 $ 10,647
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
SIX MONTHS ENDED JUNE 30, 1999
Revenues .......................................... $ - $ - $ 451 $ 12,757 $ 13,208
Cost of sales ..................................... - - 1,229 8,435 9,664
----------- ----------- ----------- ----------- -----------
Gross profit (loss) ............................... - - (778) 4,322 3,544
Selling, general and administrative expenses ...... - - 291 944 1,235
Nonrecurring acquisition expenses ................. - - 200 - 200
Nonrecurring bonuses and employment
contract termination expenses ................... - - 120 - 120
Amortization of intangible assets ................. - - - 124 124
----------- ----------- ----------- ----------- -----------
Operating income (loss) ........................... - - (1,389) 3,254 1,865
Interest expense .................................. - - 23 127 150
Other expenses (income) ........................... - - 11 (33) (22)
----------- ----------- ----------- ----------- -----------
Income (loss) before provision for
income taxes and extraordinary item ............. - - (1,423) 3,160 1,737
Provision for income taxes (benefit) .............. - - (1,244) - (1,244)
----------- ----------- ----------- ----------- -----------
Income (loss) before extraordinary item ........... $ - $ - $ (179) $ 3,160 $ 2,981
----------- ----------- ----------- ----------- -----------
----------- ----------- ----------- ----------- -----------
-----------------
Notes (a) through (d) appear on the next page.
</TABLE>
P-5
<PAGE>
(a) Avtech - For the year ended December 31, 1998, reflects the period
from January 1, 1998 to June 25, 1998; for periods subsequent to June
25, 1998, its results are included in the historical columns.
(b) Dettmers - For the year ended December 31, 1998, reflects the period
from January 1, 1998 to June 29, 1998; for periods subsequent to June
29, 1998, its results are included in the historical columns.
(c) PATS - For the year ended December 31, 1998, reflects the period from
January 1, 1998 to December 31, 1998; for the six months ended June
30, 1999, reflects the period from January 1, 1999 to January 21,
1999; subsequent to January 21, 1999, its results are included in the
historical column.
(d) PPI - For the year ended December 31, 1998, reflects the period from
January 1, 1999 to December 31, 1998; for the six months ended June
30, 1999, reflects the period from January 1, 1999 to April 22, 1999;
subsequent to April 22, 1999, its results are included in the
historical column.
(4) Reflects the results of operations of Custom Woodworks for the year ended
December 31, 1998 and the six months ended June 30, 1999.
(5) Reflects the elimination of intercompany sales.
(6) Reflects the net change in cost of sales attributable to the following
(dollars in thousands):
<TABLE>
<CAPTION>
YEAR SIX MONTHS
ENDED ENDED
DECEMBER 31, JUNE 30,
1998 1999
------------ -----------
<S> <C> <C>
Increase (decrease) in cost of goods sold (a) ............................................ $ 1,606 $ (1,093)
Decrease in depreciation expense (b) ..................................................... (658) -
Elimination of intercompany sales ........................................................ (133) -
Work force reductions attributable to merging the companies acquired ..................... (60) -
----------- -----------
Net increase (decrease) in cost of sales ............................................... $ 755 $ (1,093)
----------- -----------
----------- -----------
</TABLE>
---------------
(a) To reflect cost of goods sold based on the fair value of inventory
acquired in conjunction with the PPI and Custom Woodwork acquisitions
as if they were acquired on January 1, 1998.
(b) To reflect a decrease in depreciation expense resulting from the fair
value and remaining economic useful lives of depreciable assets
acquired in connection with the DLJ acquisition.
(7) Reflects the net decrease in selling, general and administrative expenses
attributable to the following (dollars in thousands):
<TABLE>
<CAPTION>
YEAR SIX MONTHS
ENDED ENDED
DECEMBER 31, JUNE 30,
1998 1999
------------ -----------
<S> <C> <C>
Decrease in compensation expense (a) ..................................................... $ (1,775) $ -
Decrease in investor relations expenses (b) .............................................. (221) -
Other, net (c) ........................................................................... 268 -
----------- ----------
Net decrease in selling, general and administrative expenses ........................... $ (1,728) $ -
----------- ----------
----------- ----------
</TABLE>
---------------
(a) To reflect the resignation of some former employees and changes to
employment agreements for remaining employees of the companies
acquired.
(b) To reflect the decrease in investor relations expenses associated
with becoming a privately held company as a result of the DLJ
acquisition.
(c) To reflect an increase in depreciation expense resulting from the
fair value and remaining economic useful lives of depreciable assets
acquired in connection with the DLJ acquisition, net of cost savings
attributable to employee benefit plans implemented at the companies
acquired.
P-6
<PAGE>
(8) Reflects a reduction for nonrecurring charges incurred by DeCrane Aircraft
on behalf of its stockholders related to the DLJ acquisition, and by Avtech
and PATS on behalf of their stockholders related to their respective
acquisitions by DeCrane Aircraft.
(9) Reflects a reduction in expense attributable to employment contract
termination expenses and nonrecurring bonuses awarded prior to, and in
anticipation of, the acquisitions of Avtech and PATS by DeCrane Aircraft.
(10) Reflects a reduction in expense attributable to the termination of the
Employee Stock Ownership Plans in conjunction with the acquisitions of
Avtech and PATS.
(11) Reflects a net increase in amortization expense pertaining to the
amortization of goodwill and other intangible assets related to the DLJ,
PATS, PPI and Custom Woodwork acquisitions on a straight-line basis as
follows (dollars in thousands):
<TABLE>
<CAPTION>
AMORTIZATION EXPENSE
-------------------------
YEARS YEAR SIX MONTHS
INTANGIBLE ESTIMATED ENDED ENDED
ASSET USEFUL DECEMBER 31, JUNE 30,
AMOUNT LIFE 1998 1999
----------- --------- ------------ ------------
<S> <C> <C> <C> <C>
Elimination of predecessor basis amortization:
DeCrane Aircraft ............................................. $ (1,347) $ -
PPI .......................................................... (328) (124)
DLJ acquisition amortization (a):
Goodwill ..................................................... $ 166,674 30 3,704 -
FAA certifications ........................................... 30,391 15 1,351 -
Engineering drawings ......................................... 9,138 15 406 -
Assembled workforce .......................................... 6,588 7 627 -
Tradenames, trademarks and patents ........................... 3,908 5 to 12 269 -
Goodwill amortization attributable to 1999 acquisitions (b):
PATS (c) ..................................................... 31,759 30 1,059 88
PPI (d) ...................................................... 52,896 30 1,763 588
Custom Woodwork (e) .......................................... 11,668 30 389 194
----------- ---------
Net increase in amortization ............................... $ 7,893 $ 746
----------- ---------
----------- ---------
</TABLE>
---------------
(a) For the year ended December 31, 1998, reflects amortization for the
period from January 1, 1998 to August 31, 1998. Subsequent to August
31, 1998, amortization is included in the historical column.
(b) Amortization expense may change upon completion of the final
valuations of the net assets acquired.
(c) For the year ended December 31, 1998, reflects amortization for the
period from January 1, 1998 to December 31, 1998. For the six months
ended June 30, 1999, reflects amortization for the period from
January 1, 1999 to January 21, 1999; subsequent to January 21, 1999,
amortization is included in the historical column.
(d) For the year ended December 31, 1998, reflects amortization for the
period from January 1, 1999 to December 31, 1998. For the six months
ended June 30, 1999, reflects amortization for the period from
January 1, 1999 to April 22, 1999; subsequent to April 22, 1999,
amortization is included in the historical column.
(e) Reflects amortization for the year ended December 31, 1998 and the
six months ended June 30, 1999.
P-7
<PAGE>
(12) Reflects the net increase in interest expense, including deferred financing
cost amortization and commitment fees, as a result of the 1998 Avtech,
Dettmers and DLJ acquisitions and the 1999 PATS, PPI and Customer Woodwork
acquisitions as if they all had occurred on January 1, 1998.
Pro forma interest expense consists of the following (dollars in
thousands):
<TABLE>
<CAPTION>
INTEREST EXPENSE
------------------------
YEAR SIX MONTHS
ENDED ENDED
DECEMBER 31, JUNE 30,
RATE OR TERM AMOUNT 1998 1999
----------------- ----------- ------------ -----------
<S> <C> <C> <C> <C>
Senior credit facility (a):
Revolving credit facilities ....................... LIBOR (b) + 2.75% $ (c) $ 1,621 $ 303
Term facilities:
Term A .......................................... LIBOR (b) + 2.75% (d) 2,955 1,376
Term B .......................................... LIBOR (b) + 3.00% (e) 5,615 2,613
Term C .......................................... LIBOR (b) + 3.25% (f) 6,220 2,897
Senior subordinated notes ........................... 12.00% 100,000 12,000 6,000
Customer advance .................................... 7.50% (g) 380 146
Other long-term obligations ......................... 4.34% to 18.08% (h) 148 109
Deferred financing cost amortization:
Senior revolving credit facilities ................ 6 years (i) 1,277 213 106
Senior term facilities:
Term A .......................................... 6 years (j) 894 196 98
Term B .......................................... 7 years (j) 2,043 313 156
Term C .......................................... 7 years (j) 2,168 336 167
Senior subordinated notes ......................... 10 years (j) 5,810 581 290
Commitment fees and expenses ........................ 305 197
----------- -----------
Pro forma interest expense (k) .................. $ 30,883 $ 14,458
----------- -----------
----------- -----------
</TABLE>
---------------
(a) Reflects the senior credit facility established in conjunction with
the DLJ acquisition, as amended for the PATS, PPI and Custom Woodwork
acquisitions, as if all events had occurred January 1, 1998.
(b) Calculations based on the historical LIBOR rates charged during the
respective periods. The weighted average historical LIBOR rates were
as follows:
<TABLE>
<CAPTION>
YEAR SIX MONTHS
ENDED ENDED
DECEMBER 31, JUNE 30,
1998 1999
------------ ----------
<S> <C> <C>
Revolving credit facilities .......................................................... 5.593% 4.978%
Term A facility ...................................................................... 5.694% 5.147%
Term B facility ...................................................................... 5.666% 5.124%
Term C facility ...................................................................... 5.669% 5.121%
</TABLE>
(c) Reflects revolving credit facility borrowings for the DLJ, PATS, PPI
and Custom Woodwork acquisitions as of January 1, 1998. The pro forma
weighted average borrowings outstanding under the revolving credit
facilities were $19.5 million for the twelve months ended December
31, 1998 and $7.9 million for the six months ended June 30, 1999.
(d) Reflects Term A facility borrowings of $35.0 million for the DLJ
acquisition as of January 1, 1998 reduced by quarterly principal
payments of $438,000 commencing March 31, 1999. The pro forma
weighted average borrowings outstanding under the Term A facility
were $35.0 million for the twelve months ended December 31, 1998 and
$34.9 million for the six months ended June 30, 1999.
(e) Reflects Term B facility borrowings of $65.0 million for the DLJ and
PATS acquisitions as of January 1, 1998 reduced by quarterly
principal payments of $163,000 commencing March 31, 1998. The pro
forma weighted average borrowings outstanding under the Term B
facility were $64.8 million for the twelve months ended December 31,
1998 and $64.3 million for the six months ended June 30, 1999.
P-8
<PAGE>
(f) Reflects Term C facility borrowings of $70.0 million for the PPI
acquisition and to refinance acquisition related revolving credit
facility borrowings as of January 1, 1998 reduced by quarterly
principal payments of $175,000 commencing March 31, 1998. The pro
forma weighted average borrowings outstanding under the Term C
facility were $69.7 million for the twelve months ended December 31,
1998 and $69.2 million for the six months ended June 30, 1999.
(g) Reflects a $5.0 million customer advance related to the PATS
acquisition as of January 1, 1998 reduced by principal payments of
$975,000 on November 30, 1998 and $1.2 million on May 31, 1999. The
pro forma weighted average advance outstanding was $4.9 million for
the twelve months ended December 31, 1998 and $3.8 million for the
six months ended June 30, 1999.
(h) Reflects historical interest expense related to capital lease
obligations and equipment term debt financing.
(i) Deferred financing costs are amortized on a straight-line basis over
the term of the agreement.
(j) Deferred financing costs are amortized using the effective interest
method.
(k) A 0.125% change in the interest rates charged on variable rate
borrowings would change interest expense by $245,000 for the twelve
months ended December 31, 1998 and $121,000 for the six months ended
June 30, 1999. Income (loss) before extraordinary item would change
by $148,000 for the twelve months ended December 31, 1998 and $73,000
for the six months ended June 30, 1999.
(13) Reflects adjustment for nonrecurring charges associated with a terminated
debt offering in June 1998. Such offering was terminated upon initiation of
the DLJ acquisition.
(14) Represents an increase in the provision for income taxes as a result of a
change in pro forma taxable income, a provision for income taxes on the
income of Dettmers, PPI and Custom Woodwork which were taxed as S
Corporations prior to their acquisitions, and elimination of the $2.6
million one time benefit caused by reversal of DeCrane Aircraft's deferred
tax valuation allowance. The effective tax rate differs from the U.S.
federal statutory rate due to goodwill amortization related to acquisitions
not deductible for income tax purposes and state income taxes.
(15) In conjunction with the DLJ acquisition, deferred financing costs of
$347,000, net of income tax benefit, were written off as an extraordinary
charge as a result of the termination of DeCrane Aircraft's prior senior
credit facility. In conjunction with the sale of the senior subordinated
notes described in the prospectus, deferred financing costs of $1.9
million, net of income tax benefit, were written off as an extraordinary
charge as a result of the termination of the bridge notes. These amounts
have not been reflected in the unaudited pro forma consolidated statement
of operations for the year ended December 31, 1998.
(16) Supplemental pro forma financial information is as follows (dollars in
thousands):
<TABLE>
<CAPTION>
YEAR SIX MONTHS
ENDED ENDED
DECEMBER 31, JUNE 30,
1998 1999
------------ ----------
<S> <C> <C>
Net cash provided by (used for)
Operating activities ................................................................... $ 2,216 $ 12,977
Investing activities ................................................................... (204,031) (6,091)
Financing activities ................................................................... 203,492 (8,943)
EBITDA (a) ............................................................................... 54,528 27,463
Depreciation and amortization (b) ........................................................ 17,963 9,054
Capital expenditures
Paid in cash ........................................................................... 6,789 3,169
Financed with capital lease obligations ................................................ 164 1,323
Cash interest expense .................................................................... 29,244 13,641
Ratio of earnings to fixed charges (c) ................................................... - 1.3x
</TABLE>
---------------
Notes (a) through (c) appear on the next page.
P-9
<PAGE>
(a) EBITDA equals operating income plus depreciation, amortization,
parent company management fees and certain non-cash and acquisition
related charges. EBITDA is not a measure of performance or financial
condition under generally accepted accounting principles. EBITDA is
not intended to represent cash flow from operations and should not be
considered as an alternative to income from operations or net income
computed in accordance with generally accepted accounting principles,
as an indicator of our operating performance, as an alternative to
cash flow from operating activities or as a measure of liquidity. The
funds depicted by EBITDA are not available for our discretionary use
due to funding requirements for working capital, capital
expenditures, debt service, income taxes and other commitments and
contingencies. We believe that EBITDA is a standard measure of
liquidity commonly reported and widely used by analysts, investors
and other interested parties in the financial markets. However, not
all companies calculate EBITDA using the same method and the EBITDA
numbers set forth above may not be comparable to EBITDA reported by
other companies.
(b) Reflects depreciation and amortization of plant and equipment,
goodwill and other intangible assets. Excludes amortization of
deferred financing costs and debt discounts, which are classified as
a component of interest expense.
(c) For purposes of calculating the earnings to fixed charges ratio,
earnings represent net income before income taxes, minority interest
in the income of majority-owned subsidiaries, extraordinary items
and fixed charges. Fixed charges consist of:
- interest, whether expensed or capitalized;
- amortization of debt expense and discount relating to any
indebtedness, whether expensed or capitalized; and
- one-third of rental expense under operating leases which is
considered to be a reasonable approximation of the interest
portion of such expense.
There was a $792,000 deficiency of earnings to fixed charges for the
year ended December 31, 1998.
(17) Reflects DeCrane Aircraft's financial position subsequent to the 1998
Avtech, Dettmers and DLJ acquisitions and the 1999 PATS and PPI
acquisitions.
(18) Reflects DeCrane Aircraft's purchase of substantially all of the assets,
subject to accounts payable and accrued liabilities assumed, of Custom
Woodwork in August 1999. Sources and uses of funds for the acquisition,
had it occurred on June 30, 1999, are as follows (dollars in thousands):
<TABLE>
<CAPTION>
AMOUNT
-----------
<S> <C>
SOURCES
Senior revolving credit facility borrowings ........................................................... $ 13,815
-----------
-----------
USES
Purchase of assets, net of accounts payable and accrued liabilities assumed ........................... $ 13,315
Estimated acquisition fees and expenses ............................................................... 500
-----------
Total uses .......................................................................................... $ 13,815
-----------
-----------
</TABLE>
(19) Reflects the financial position of Custom Woodworks as of June 30, 1999.
(20) Reflects the elimination of Custom Woodwork's cash and cash equivalents not
acquired.
(21) Reflects the increase in Custom Woodwork's inventory to its estimated fair
value as of the acquisition date.
(22) Reflects the excess of the Custom Woodwork purchase price over the fair
value of the assets acquired. For purposes of this pro forma consolidated
financial information, we allocated the excess purchase price to goodwill
and amortized it on a straight-line basis over 30 years. Such allocation is
preliminary and may change upon the completion of the final valuations of
the assets acquired.
(23) Reflects the senior credit facility borrowings for the Custom Woodwork
acquisition. The terms of the senior credit facility are described in our
historical consolidated financial statements included in the prospectus.
(24) Reflects the elimination of Custom Woodwork's stockholders' equity upon
acquisition.
P-10
<PAGE>
EXHIBIT 13.20.1
ARTICLES OF INCORPORATION
OF
PCI ACQUISITION CO., INC.
FIRST. The name of the Corporation is:
PCI Acquisition Co., Inc.
SECOND. The address of its registered office in the State of Kansas is 515
South Kansas, Topeka, County of Shawnee, Kansas 66603. The name of its resident
agent at such address is the Corporation Company, Inc.
THIRD. The nature of the business or purposes to be conducted or promoted
by the Corporation is to engage in any lawful act or activity for which
corporations may be organized under the Kansas general corporation code.
In addition to the powers and privileges conferred upon the Corporation by
law and those incidental thereto, the Corporation shall possess and may exercise
all the powers and privileges which are necessary or convenient to the conduct,
promotion or attainment of the business or purposes of the Corporation.
FOURTH.
(a) The total number of shares of stock which the Corporation shall have
authority to issue is One Thousand (1,000) shares of common stock, of the par
value of $0.01 per share.
The Board of Directors is authorized to provide by resolution or
resolutions for the issuance of shares of stock of any class or of any series of
any class at any time and from time to time and, by filing a certificate of
designations in the manner prescribed under the laws of the State of Kansas, to
fix and, if no shares of stock have been issued of a class or series of stock,
amend the voting powers, full or limited, or no voting powers, and the
designations, preferences and relative, participating, optional or other special
rights, if any, and qualifications, limitations or restrictions thereof. Unless
otherwise provided in any such resolution or resolutions, the number of shares
of stock of any such series to which such resolution or resolutions apply may be
increased (but not above the total number of authorized shares of the class or
series) or decreased (but not below the number of shares thereof then
outstanding) by filing a certificate of designations in the manner prescribed
under the laws of the State of Kansas.
1
<PAGE>
(b) No holder of any shares of stock of the Corporation of any class shall
be entitled as such, as a matter of right, to subscribe for or purchase any
shares of stock of the Corporation of any class, whether now or hereafter
authorized or whether issued for cash, property or services or as a dividend or
otherwise, or to subscribe for or purchase any obligations, bonds, notes,
debentures, other securities or stock convertible into shares of stock of the
Corporation of any class or carrying or evidencing any right to purchase shares
of stock of any class.
FIFTH. The name and mailing address of the incorporator are as follows:
<TABLE>
<CAPTION>
NAME ADDRESS
<S> <C>
Craig L. Evans 1201 Walnut, Suite 2800
Kansas City, Missouri 64106
</TABLE>
SIXTH. The number of directors of the Corporation shall be fixed by, or in
the manner provided in, the Bylaws, The names and mailing addresses of the
persons who are to serve as the initial directors of the Corporation until the
first annual meeting of the stockholders, until such director's successor is
duly elected and qualified, or until such director's earlier resignation or
removal, are as follows:
<TABLE>
<CAPTION>
NAMES ADDRESSES
<S> <C>
R. Jack DeCrane 2361 Rosecrans Avenue, Suite 180
El Segundo, California 90245
Richard J. Kaplan 2361 Rosecrans Avenue, Suite 180
El Segundo, California 90245
</TABLE>
SEVENTH. Elections of directors need not be by ballot unless the Bylaws of
the Corporation so provide.
EIGHTH. The original Bylaws of the Corporation shall be adopted in any
manner provided by law. Thereafter, the Bylaws of the Corporation may from time
to time be amended or repealed, or new Bylaws may be adopted, in any of the
following ways: (i) by the holders of a majority of the outstanding shares of
stock of the Corporation entitled to vote thereon, or (ii) by a majority of the
full Board of Directors, and any change so made by the stockholders may
thereafter be further changed by a majority of the directors; provided, however,
that the power of the Board of Directors to amend or repeal the Bylaws, or to
adopt new Bylaws, (A) may be denied as to any Bylaws or portion thereof by the
stockholders if at the time of enactment the stockholders shall so expressly
provide, and (B) shall not divest the stockholders of their power, nor limit
their power, to amend or repeal the Bylaws, or to adopt new Bylaws.
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NINTH. The Corporation may agree to the terms and conditions upon which
any director, officer, employee or agent accepts his office or position and in
its Bylaws, by contract or in any other manner may agree to indemnify and
protect any director, officer, employee or agent of the Corporation, or any
person who serves at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, to the fullest extent permitted by
the laws of the State of Kansas.
Without limiting the generality of the foregoing provisions of this Article
NINTH, to the fullest extent permitted or authorized by the laws of the State of
Kansas, including, without limitation, the provisions of subsection (b)(8) of K.
S.A. 17-6002 as now in effect and as it may from time to time hereafter be
amended, no director of the Corporation shall be personally liable to the
Corporation or to its stockholders for monetary damages for breach of fiduciary
duty as a director. Any repeal or modification of the limitation of liability
provided by the immediately preceding sentence shall not adversely affect any
right or protection of a director of the Corporation existing hereunder with
respect to any act or omission occurring prior to or at the time of such repeal
or modification.
TENTH. Whenever a compromise or arrangement is proposed between this
Corporation and its creditors or any class of them or between this Corporation
and its stockholders or any class of them, any court of competent jurisdiction
within the State of Kansas, on the application in a summary way of this
Corporation or of any creditor or stockholder thereof or on the application of
any receiver or receivers appointed for this Corporation under the provisions of
K.S.A. 17-6901 and amendments thereto, or on the application of trustees in
dissolution or of any receiver or receivers appointed for this Corporation under
the provisions of K.S.A. 17-6808 and amendments thereto, may order a meeting of
the creditors or class of creditors, or of the stockholders or class of
stockholders of this Corporation, as the case may be, to be summoned in such
manner as such court directs. If a majority in number representing three-fourths
in value of the creditors or class of creditors, or of the stockholders or class
of stockholders of this Corporation, as the case may be, agree to any compromise
or arrangement and to any reorganization of this Corporation as consequence of
such compromise or arrangement and the reorganization, if sanctioned by the
court to which the application has been made, shall be binding on all the
creditors or class of creditors, or on all the stockholders or class of
stockholders, of this Corporation, as the case may be, and also on this
Corporation.
ELEVENTH. Except as may be otherwise provided by statute, the Corporation
shall be entitled to treat the registered holder of any shares of the
Corporation as the owner of such shares and of all rights derived from such
shares for all purposes, and the Corporation shall not be obligated to recognize
any equitable or other claim to or interest in such shares or rights on the part
of any other person, including, but without limiting the generality of the term
"person" to, a purchaser, pledgee, assignee or transferee of such shares or
rights, unless and until such person becomes the registered holder of such
shares. The foregoing shall apply whether or not the Corporation shall have
either actual or constructive notice of the claim by or the interest in such
person.
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TWELFTH. The books of the Corporation may be kept (subject to any
provision contained in the statutes of the State of Kansas) outside the State of
Kansas at such place or places as may be designated from time to time by the
Board of Directors or in the Bylaws of the Corporation.
THIRTEENTH. The Corporation reserves the right to amend, alter, change or
repeal any provision contained in these Articles of Incorporation in the manner
now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
The undersigned, for the purpose of forming a corporation under the Kansas
general corporation code, does hereby execute these Articles, and does hereby
declare and certify that this is his act and deed and the facts herein stated
are true, and accordingly has executed these Articles of Incorporation as of
September 29, 1999.
/s/ Craig L. Evans
----------------------------
Craig L. Evans, Incorporator
STATE OF MISSOURI )
) SS,
COUNTY OF JACKSON )
This instrument was acknowledged before me this 29th day of September,
1999, by Craig L. Evans,
/s/ Erin Dudley
----------------------------------------
Notary Public in and for said County and
State
(NOTARIAL SEAL)
My commission expires: February 5, 2001
------------------------------------
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EXHIBIT 13.20.2
BYLAWS
OF
PCI ACQUISITION CO., INC.
ARTICLE 1
Offices
Section 1.1 REGISTERED OFFICE. The location of the registered office
and the name of the registered agent of the Corporation in the State of Kansas
shall be as stated in the Articles of Incorporation or as shall be determined
from time to time by resolution of the Board of Directors and on file in the
appropriate offices of the State of Kansas pursuant to applicable provisions of
law.
Section 1.2 OTHER OFFICES. The Corporation may also have offices at
such other places both within and without the State of Kansas as the Board of
Directors may from time to time determine or the business of the Corporation may
require.
ARTICLE 2
Meetings of Stockholders
Section 2.1 ANNUAL MEETINGS. Annual meetings of stockholders shall be
held on a date set by the Board of Directors in each year for the purpose of
electing directors and transacting such other proper business as may come before
the meeting.
Section 2.2 SPECIAL MEETINGS. Special meetings shall by held solely for
the purpose or purposes specified in the notice of meeting.
Section 2.3 TIME AND PLACE OF MEETINGS. Subject to the provisions of
Section 2.1 each meeting of stockholders shall be held on such date, at such
hour and at such place, either within or without the State of Kansas, as shall
be fixed by the Board of Directors or in the notice of the meeting or, in the
case of an adjourned meeting, as announced at the meeting at which the
adjournment is taken.
Section 2.4 NOTICE OF MEETINGS. A written notice of each meeting of
stockholders, stating the place, date and hour of the meeting and, in the case
of a special meeting, the purpose or purposes for which the meeting is called,
shall be given either personally or by mail to each stockholder entitled to vote
at the meeting. Unless otherwise provided by statute, the notice shall
<PAGE>
be given not less than ten nor more than sixty days before the date of the
meeting and, if mailed, shall be deposited in the United States mail, postage
prepaid, directed to the stockholder at his address as it appears on the
records of the Corporation. No notice need be given to any person with whom
communication is unlawful, nor shall there be any duty to apply for any
permit or license to give notice to any such person. If the time and place
of an adjourned meeting of stockholders are announced at the meeting at which
the adjournment is taken, no notice need be given of the adjourned meeting
unless that adjournment is for more than thirty days or unless, after the
adjournment, a new record date is fixed for the adjourned meeting.
Section 2.5 WAIVER OF NOTICE. Anything herein to the contrary
notwithstanding, notice of any meeting of stockholders need not be given to any
stockholder who in person or by proxy shall have waived in writing notice of the
meeting, either before or after such meeting, or who shall attend the meeting in
person or by proxy, unless he attends for the express purpose of objecting, at
the beginning of the meeting, to the transaction of any business because the
meeting is not lawfully called or convened.
Section 2.6 QUORUM AND MANNER OF ACTING. Subject to the provisions of
these bylaws, the articles of incorporation and statutes as to the vote that is
required for a specified action, the presence in person or by proxy of the
holders of 50% of the outstanding shares of the Corporation entitled to vote at
any meeting of stockholders, plus one share, shall constitute a quorum for the
transaction of business, and the vote in person or by proxy of the holders of a
majority of the shares constituting such quorum shall be binding on all
stockholders of the Corporation. A majority of the shares present in person or
by proxy and entitled to vote may, regardless of whether or not they constitute
a quorum, adjourn the meeting to another time and place. Any business which
might have been transacted at the original meeting may be transacted at any
adjourned meeting at which a quorum is present.
Section 2.7 VOTING. Stockholders shall be entitled to cumulative voting
at all elections of directors to the extent provided in or pursuant to the
articles of incorporation. Stockholders may vote by proxy but no proxy shall be
voted or acted upon after three years from its date, unless the proxy provides
for a longer period.
Section 2.8 INSPECTION OF ELECTION.
(a) The Board of Directors shall appoint an inspector of election to
act at each meeting of stockholders and any adjournment thereof. If an
inspector of election is not so appointed, or the person appointed as inspector
fails or refuses to act, the chairman of the meeting shall appoint an inspector
of election.
(b) The inspector of election shall determine the outstanding stock
of the Corporation and the voting power of each class and series, the stock
represented at the meeting and the existence of a quorum, shall receive votes or
ballots, shall count and tabulate all votes and shall determine the result; and
in connection therewith, the inspector shall determine the authority,
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validity and effect of proxies, hear and determine all challenges and
questions, and do such other acts as may be proper to conduct the election or
vote with fairness to all stockholders.
(c) The inspector of election shall make a report in writing of any
challenge or question or other matter determined by him and shall execute a
certificate of any fact found in connection therewith. Any such report or
certificate shall be filed with the record of the meeting.
Section 2.9 LIST OF STOCKHOLDERS. A complete list of the stockholders
entitled to vote at each meeting of stockholders, arranged in alphabetical
order, and showing the address and number of shares registered in the name of
each stockholder, shall be prepared and made available for examination during
regular business hours by any stockholder for any purpose germane to the
meeting. The list shall be available for such examination at the place where
the meeting is to be held for a period of not less than ten days prior to the
meeting and during the whole time of the meeting.
Section 2.10 ACTION WITHOUT A MEETING. Any action required to be taken
at any annual or special meeting of stockholders, or any action which may be
taken at any annual or special meeting of stockholders, may be taken without a
meeting, without prior notice and without a vote, if a consent in writing,
setting forth the action so taken, shall be signed by the holders of outstanding
stock having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares entitled to
vote thereon were present and voted.
ARTICLE 3
Board of Directors
Section 3.1 NUMBER. The number of directors shall be no less than one
and no more than five, and shall be set by the Board of Directors by adoption of
a resolution with respect thereto.
Section 3.2 ORGANIZATION MEETINGS. As promptly as practicable after
each annual meeting of stockholders, an organization meeting of the Board of
Directors shall be held for the purpose of organization and the transaction of
other business.
Section 3.3 REGULAR MEETINGS. Regular meetings of the Board of
Directors may be held at such place and time as may be designated by the Board.
Section 3.4 SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by the Chairman, the President, any three directors, or,
if less than three, the remaining directors.
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Section 3.5 BUSINESS OF MEETINGS. Except as otherwise expressly
provided in these bylaws, any and all business may be transacted at any meeting
of the Board of Directors; PROVIDED, that if so stated in the notice of
meeting, the business transacted at a special meeting shall be limited to the
purpose or purposes specified in the notice.
Section 3.6 TIME AND PLACE OF MEETINGS. Subject to the provisions of
Section 3.4 each meeting of the Board of Directors shall be held on such date,
at such hour and in such place as fixed by the Board or in the notice or waivers
of notice of the meeting or, in the case of an adjourned meeting, as announced
at the meeting at which the adjournment is taken.
Section 3.7 NOTICE OF MEETINGS. No notice need be given of any
organization or regular meeting of the Board of Directors for which the date,
hour and place have been fixed by the Board. Notice of the date, hour and place
of all other organization and regular meetings, and of all special meetings,
shall be given to each director personally, by telephone or telegraph or by
mail. If by mail, the notice shall be deposited in the United States mail,
postage prepaid, directed to the director at his residence or usual place of
business as the same appear on the books of the Corporation not later than five
days before the meeting. If given by telegraph, the notice shall be directed to
the director at his residence or usual place of business as the same appear on
the books of the Corporation not later than at any time during the day before
the meeting. If given personally or by telephone, the notice shall be given not
later than the day before the meeting.
Section 3.8 WAIVER OF NOTICE. Anything herein to the contrary
notwithstanding, notice of any meeting of the Board of Directors need not be
given to any director who shall have waived in writing notice of the meeting,
either before or after the meeting, or who shall attend such meeting, unless he
attends for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business because the meeting is not lawfully called or
convened.
Section 3.9 ATTENDANCE BY TELEPHONE. Directors may participate in
meetings of the Board of Directors by means of conference telephone or similar
communications equipment by means of which all directors participating in the
meeting can hear one another, and such participation shall constitute presence
in person in the meeting.
Section 3.10 QUORUM AND MANNER OF ACTING. A majority of the total number
of directors at the time provided for pursuant to Section 3.1 shall constitute a
quorum for the transaction of business at any meeting of the Board of Directors
and, except as otherwise provided in these bylaws, in the articles of
incorporation or by statute, the act of a majority of the directors present at
any meeting at which a quorum is present shall be the act of the Board. A
majority of the directors present at any meeting, regardless of whether or not
they constitute a quorum, may adjourn the meeting to another time or place. Any
business which might have been transacted at the original meeting may be
transacted at any adjourned meeting at which a quorum is present.
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Section 3.11 ACTION WITHOUT A MEETING. Any action which could be taken
at a meeting of the Board of Directors may be taken without a meeting if all of
the directors consent to the action in writing and the writing or writings are
filed with the minutes of the Board.
Section 3.12 RESIGNATION OF DIRECTORS. Any director may resign at any
time upon written notice to the Corporation. The resignation shall become
effective at the time specified in the notice and, unless otherwise provided in
the notice, acceptance of the resignation shall not be necessary to make it
effective.
Section 3.13 VACANCIES AND REMOVAL. Vacancies in the Board of Directors,
except vacancies created by removal of a director by the shareholders, may be
filled by a majority of the remaining directors, though less than a quorum, or
by a sole remaining director, and each director so elected shall hold office
until a successor is elected at an annual or a special meeting of the
shareholders in accordance with these Bylaws.
The shareholders may elect a director or directors at any time to fill any
vacancy or vacancies not filled by the directors. If the Board of Directors
accepts the resignation of a director tendered to take effect at a future time,
the Board or the shareholders may elect a successor to take office when the
resignation is to become effective.
No reduction of the authorized number of directors shall have the effect
of removing any director prior to the expiration of such director's term of
office.
A vacancy or vacancies in the Board of Directors shall be deemed to exist
in case of the death, resignation or removal of any director, or if the
authorized number of directors is increased, or if the shareholders fail at any
annual or special meeting of shareholders at which any director or directors are
elected to elect the full authorized number of directors to be voted for at that
meeting. The Board may declare vacant the office of a director who has been
declared of unsound mind by an order of court or convicted of a felony.
All the directors, or any individual director or directors, may be removed
from office, without cause, by the vote of the shareholders having a majority of
the voting power entitling them to elect directors in place of those to be
removed.
ARTICLE 4
Committees of the Board of Directors
Section 4.1 EXECUTIVE COMMITTEE. By resolution adopted by an
affirmative vote of the majority of the whole Board of Directors, the Board may
appoint an Executive Committee consisting of the chief executive officer of the
Corporation, EX OFFICIO, and two or more other directors and, if deemed
desirable, one or more directors as alternate members who may replace any
absentee or disqualified member at any meeting of the Executive Committee. If
so
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appointed, the Executive Committee shall, when the Board is not in session,
have all the power and authority of the Board in the management of the
business and affairs of the Corporation not reserved to the Board by Section
4.3 including, but not limited to, the power and authority to declare
dividends, to authorize the issuance of stock and to adopt a certificate of
ownership and merger. The Executive Committee shall keep a record of its
acts and proceedings and shall report the same from time to time to the Board
of Directors.
Section 4.2 OTHER COMMITTEES. By resolution adopted by an affirmative
vote of the majority of the whole Board of Directors, the Board may from time to
time appoint such other committees of the Board, consisting of one or more
directors and, if deemed desirable, one or more directors who shall act as
alternate members and who may replace any absentee or disqualified member at any
meeting of the committee, and may delegate to each such committee any of the
powers and authority of the Board in the management of the business and affairs
of the Corporation not reserved to the Board pursuant to Section 4.3. Each such
committee shall keep a record of its acts and proceedings.
Section 4.3 POWERS RESERVED TO THE BOARD. No committee of the Board
shall take any action to amend the articles of incorporation (except that a
committee may, to the extent authorized in the resolution or resolutions
providing for the issuance of shares of stock adopted by the Board, fix any of
the preferences or rights of such shares relating to dividends, redemption,
dissolution, any distribution of assets of the Corporation or the conversion
into, or the exchange of such shares for, shares of any other class or classes
or any other series of the same or any other class or classes of stock of the
Corporation) or these bylaws, adopt any agreement to merge or consolidate the
Corporation, or recommend to the stockholders a sale, lease or exchange of all
or substantially all of the property and assets of the Corporation, a
dissolution of the Corporation or a revocation of a dissolution of the
Corporation; nor shall any committee of the Board take any action which is
required in these bylaws, in the articles of incorporation or by statute to be
taken by a vote of a specified proportion of the whole Board of Directors.
Section 4.4 ELECTION OF COMMITTEE MEMBERS; VACANCIES. So far as
practicable, members of the committees of the Board and their alternates (if
any) shall be appointed at each organization meeting of the Board of Directors
and, unless sooner discharged by an affirmative vote of the majority of the
whole Board, shall hold office until the next organization meeting of the Board
and until their respective successors are appointed. In the absence or
disqualification of any member of a committee of the Board, the member or
members (including alternates) present at any meeting of the committee and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another director to act at a meeting in place of any absent
or disqualified member. Vacancies in committees of the Board created by death,
resignation or removal may be filled by an affirmative vote of a majority of the
whole Board of Directors.
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Section 4.5 MEETINGS. Each committee of the Board may provide for
regular meetings of such committee. Special meetings of each committee may be
called by any two members of the committee (or, if there is only one member, by
that member in concert with the chief executive officer) or by the chief
executive officer of the Corporation. The provisions of Section 3 regarding the
business, time and place, notice and waivers of notice of meetings, attendance
at meetings and action without a meeting shall apply to each committee of the
Board, except that the references in such provisions to the directors and the
Board of Directors shall be deemed respectively to be references to the members
of the committee and to the committee.
Section 4.6 QUORUM AND MANNER OF ACTING. A majority of the members of
any committee of the Board shall constitute a quorum for the transaction of
business at meetings of the committee, and the act of a majority of the members
present at any meeting at which a quorum is present shall be the act of the
committee. A majority of the members present at any meeting, regardless of
whether or not they constitute a quorum, may adjourn the meeting to another time
or place. Any business which might have been transacted at the original meeting
may be transacted at any adjourned meeting at which a quorum is present.
ARTICLE 5
Officers
Section 5.1 ELECTION AND APPOINTMENT. The elected officers of the
Corporation shall consist of a Chief Executive Officer, one or more Vice
Presidents, a Treasurer, a Secretary and such other elected officers as shall
from time to time be designated by the Board of Directors. The Board shall
designate from among such elected officers a chief executive officer and a chief
financial officer of the Corporation, and may from time to time make, or provide
for, other designations it deems appropriate. The Board may also appoint, or
provide for the appointment of, such other officers and agents as may from time
to time appear necessary or advisable in the conduct of the affairs of the
Corporation. Any number of offices may be held by the same person, except no
person may at the same time be both the Chief Executive Officer and the chief
financial officer.
Section 5.2 DUTIES OF CHIEF EXECUTIVE OFFICER. The chief executive
officer of the Corporation shall preside at all meetings of stockholders and
(unless the Board of Directors elects a separate Chairman) at all meetings of
the Board of Directors and the Executive Committee and, except to the extent
otherwise provided in these bylaws or by the Board, shall have general authority
to execute any and all documents in the name of the Corporation and general and
active supervision and control of all of the business and affairs of the
Corporation. In the absence of the chief executive officer, his duties shall be
performed and his powers may be exercised by the chief financial officer or by
such other officer as shall be designated either by the chief executive officer
in writing or (failing such designation) by the Executive Committee or Board of
Directors.
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Section 5.3 DUTIES OF OTHER OFFICERS. The other officers of the
Corporation shall have such powers and duties not inconsistent with these bylaws
as may from time to time be conferred upon them in or pursuant to resolutions of
the Board of Directors, and shall have such additional powers and duties not
inconsistent with such resolutions as may from time to time be assigned to them
by any competent superior officer. The Board shall assign to one or more of the
officers of the Corporation the duty to record the proceedings of the meetings
of the stockholders and the Board of Directors in a book to be kept for that
purpose.
Section 5.4 TERM OF OFFICE AND VACANCY. So far as practicable, the
elected officers shall be elected at each organization meeting of the Board, and
shall hold office until the next organization meeting of the Board and until
their respective successors are elected and qualified. If a vacancy shall occur
in any elected office, the Board of Directors may elect a successor for the
remainder of the term. Appointed officers shall hold office at the pleasure of
the Board. Any officer may resign by written notice to the Corporation.
Section 5.5 REMOVAL OF ELECTED OFFICERS. Elected officers may be
removed at any time, either for or without cause, by the affirmative vote of a
majority of the whole Board of Directors at a meeting called for that purpose.
Section 5.6 COMPENSATION OF ELECTED OFFICERS. The compensation of all
elected officers of the Corporation shall be fixed from time to time by the
Board of Directors.
ARTICLE 6
Shares and Transfer of Shares
Section 6.1 CERTIFICATES. Every stockholder shall be entitled to a
certificate signed by the Chairman or Vice Chairman of the Board of Directors,
or the Chief Executive Officer or the President, and by the Chief Financial
Officer or the Treasurer or an Assistant Treasurer, or the Secretary or an
Assistant Secretary of the Corporation, certifying the class and number of
shares owned by him in the Corporation; PROVIDED that, any and all signatures on
a certificate may be a facsimile. In case any officer, transfer agent or
registrar who has signed or whose facsimile signature has been placed upon a
certificate shall have ceased to be such officer, transfer agent or registrar
before such certificate is issued, it may be issued by the Corporation with the
same effect as if he or it were such officer, transfer agent or registrar at the
date of issue.
Section 6.2 TRANSFER AGENTS AND REGISTRARS. The Board of Directors may,
in its discretion, appoint one or more responsible banks or trust companies in
the City of New York or in such other city or cities (if any) as the Board may
deem advisable, from time to time, to act as transfer agents and registrars of
shares of the Corporation; and, when such appointments shall have been made, no
certificate for shares of the Corporation shall be valid until countersigned by
one of such transfer agents and registered by one of such registrars.
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Section 6.3 TRANSFERS OF SHARES. Shares of the Corporation may be
transferred by delivery of the certificates therefor, accompanied either by an
assignment in writing on the back of the certificates or by written power of
attorney to sell, assign and transfer the same, signed by the record holder
thereof; but no transfer shall affect the right of the Corporation to pay any
dividend upon the shares to the holder of record thereof, or to treat the holder
of record as the holder in fact thereof for all purposes, and no transfer shall
be valid, except between the parties thereto, until such transfer shall have
been made upon the books of the Corporation.
Section 6.4 LOST CERTIFICATES. In case any certificate for shares of
the Corporation shall be lost, stolen or destroyed, the Board of Directors, in
its discretion, or any transfer agent thereunto duly authorized by the Board,
may authorize the issue of a substitute certificate in place of the certificate
so lost, stolen or destroyed, and may cause such substitute certificate to be
countersigned by the appropriate transfer agent (if any) and registered by the
appropriate registrar (if any); PROVIDED that, in each such case, the applicant
for a substitute certificate shall furnish to the Corporation and to such of its
transfer agents and registrars as may require the same, evidence to their
satisfaction, in their discretion, of the loss, theft or destruction of such
certificate and of the ownership thereof, and also such security or indemnity as
may by them be required.
Section 6.5 RECORD DATES. In order that the Corporation may determine
the stockholders entitled to notice of or to vote at any meeting of
stockholders, or any adjournment thereof, or to express consent to action in
writing without a meeting, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of shares or for the
purpose of any other lawful action, the Board of Directors may fix, in advance,
a record date which shall be not more than sixty nor less than ten days before
the date of any meeting of stockholders, and not more than sixty days prior to
any other action. In such case, those stockholders, and only those
stockholders, who are stockholders of record on the date fixed by the Board of
Directors shall, notwithstanding any subsequent transfer of shares on the books
of the Corporation, be entitled to notice of and to vote at such meeting of
stockholders, or any adjournment thereof, or to express consent to such
corporate action in writing without a meeting, or entitled to receive payment of
such dividend or other distribution or allotment of rights, or entitled to
exercise rights in respect of any such change, conversion or exchange of shares
or to participate in any such other lawful action.
ARTICLE 7
Miscellaneous
Section 7.1 FISCAL YEAR. The fiscal year of the Corporation shall be
fixed by resolution of the Board of Directors.
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Section 7.2 SIGNATURE ON NEGOTIABLE INSTRUMENTS. All bills, notes,
checks or other instruments for the payment of money shall be signed or
countersigned in such manner as from time to time may be prescribed by
resolution of the Board of Directors.
Section 7.3 INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES, AGENTS
AND FIDUCIARIES; INSURANCE.
(a) The Corporation may indemnify, in accordance with and to the full
extent permitted by the laws of the State of Kansas, as such laws may be amended
from time to time, and shall so indemnify to the full extent permitted by such
laws, any person (and the heirs and legal representatives of any such person)
made or threatened to be made a party to any threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative, by reason of the fact that such person is or was a director,
officer, employee, agent, or fiduciary of the Corporation or any constituent
corporation absorbed in a consolidation or merger, or serves or served as such
with another corporation, partnership, joint venture, trust or other enterprise
at the request of the Corporation or any such constituent corporation.
(b) By action of the Board of Directors notwithstanding any interest
of the directors in such action, the Corporation may purchase and maintain
insurance in such amounts as the Board of Directors deems appropriate on behalf
of any person who is or was a director, officer, employee, agent or fiduciary of
the Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee, agent or fiduciary of another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or arising out of
his status as such, whether or not the Corporation shall have power to indemnify
him against such liability under the provisions of this Section.
ARTICLE 8
Bylaw Amendments
Section 8.1 BY THE STOCKHOLDERS. These bylaws may be amended by the
stockholders at a meeting called for the purpose in any manner not inconsistent
with any provision of law or of the articles of incorporation.
Section 8.2 BY THE DIRECTORS. These bylaws may be amended by the
affirmative vote of a majority of the whole Board of Directors in any manner not
inconsistent with any provision of law or of the articles of incorporation.
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EXHIBIT 13.21.1
ARTICLES OF INCORPORATION
OF
INTERNATIONAL CUSTOM INTERIORS, INC.
The undersigned incorporator, being a person competent to contract
subscribes to these Articles of Incorporation to form a for profit corporation
under the laws of the State of Florida.
ARTICLE I
NAME. The name and mailing address of this corporation is:
International Custom Interiors, Inc.
16511 Bayridge Drive
Clermont, Florida 34711
ARTICLE II
BUSINESS AND ACTIVITIES. This corporation may and is authorized to engage
in any activity or business permitted under the laws of the United States and of
the State of Florida.
ARTICLE III
CAPITAL STOCK. The maximum number of shares of stock that this corporation
is authorized to have outstanding at any one time is 10,000 shares of common
stock having a par value of $1 per share, with the consideration to be paid for
each share to be in money, property, or services actually performed as may be
fixed by the Board of Directors.
ARTICLE IV
TERM OF EXISTENCE. This corporation shall commence on date of execution
and shall have perpetual existence.
ARTICLE V
INITIAL REGISTERED OFFICE AND AGENT. The address of the initial registered
office of the corporation is 16511 Bayridge Drive, Clermont, Florida 34711 and
the name of the initial registered agent of the corporation at that address is
Alan Cook.
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ARTICLE VI
NUMBER OF DIRECTORS. This corporation shall have one (1) director
initially. The number of directors may be increased from time to time by the
Board of Directors or the shareholders in accordance with the By-Laws of this
corporation. Directors as such, shall receive such compensation for their
services, if any, as may be set by the Board of Directors at an annual or
special meeting.
ARTICLE VII
INITIAL BOARD OF DIRECTORS. The name and street address of the initial
director of this corporation is:
Alan Cook 16511 Bayridge Drive
Clermont, Florida 34711
ARTICLE VIII
INCORPORATOR. The name and street address of the incorporator signing
these articles is:
Alan Cook 16511 Bayridge Drive
Clermont, Florida 34711
ARTICLE IX
LOST OR DESTROYED CERTIFICATES. Stock certificates to replace lost or
destroyed certificates shall be issued on such basis and according to such
procedures as are from time-to-time provided for in the by-laws of this
corporation.
ARTICLE X
AMENDMENT TO ARTICLES. These Articles of Incorporation may be amended in
the manner provided by law. Every amendment shall be approved by the Board of
Directors proposed by them to the shareholders and approved at a shareholders'
meeting by a majority of the stock issued and entitled to be voted, unless all
of the Directors and all the shareholders sign a written statement manifesting
their intention that a certain amendment of these Articles of Incorporation be
made. Any rights conferred by these Articles of Incorporation upon the
shareholders are subject to this reservation.
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ARTICLE XI
BY-LAWS. The power to adopt, alter, amend, or repeal By-Laws of this
corporation shall be vested in the Board of Directors.
ARTICLE XII
INDEMNIFICATION. This corporation shall indemnify any officer or director,
or any former officer or director to the full extent permitted by the law.
ARTICLE XIII
RIGHT OF FIRST REFUSAL. No shareholder of this corporation shall have the
right to sell or assign stock of this corporation without having first offered
to sell such shares first to the corporation and then to other shareholders of
the corporation at the same price and at the same terms and conditions pursuant
to which the shareholder intends to sell their shares subject only to this right
of first refusal in the corporation and the other shareholders.
Each stock certificate issued representing shares of this corporation shall
bear a restrictive legend as follows:
Transfer of this certificate and the shares represented hereby is subject
to the right of first refusal of the corporation and the other shareholders
contained in the Articles of Incorporation of the corporation to which the
holder hereof assents.
IN WITNESS WHEREOF, the undersigned does set their hand and seal and has
acknowledged and filed the foregoing Articles of Incorporation under the laws of
the State of Florida this 14th day of March, 1995.
/s/ Allan Cook
----------------------------------
Alan Cook
C200-014-56-286-0
----------------------------------
Florida Driver's License
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STATE OF FLORIDA
COUNTY OF SEMINOLE
I HEREBY CERTIFY that on this day, before me, an officer duly authorized in
the State and County aforesaid to take acknowledgements, personally appeared
Alan Cook, who produced a current driver's license issued by the State of
Florida Department of Motor Vehicles as identification, and they executed the
foregoing Articles of Incorporation in my presence freely and voluntarily, and
for the uses and purposes expressed therein.
WIITNESS my hand and official seal in the County and State aforesaid this
14th day of March 1995.
/s/ Shawn L. Hartsfield
----------------------------------------
NOTARY PUBLIC, State of Florida
Name: Shawn L. Hartsfield
-----------------------------------
Commission Number: 257502
----------------------
My commission expires: 2/7/97
-----------------
(NOTARY SEAL)
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EXHIBIT 13.21.2
BY-LAWS
OF
INTERNATIONAL CUSTOM INTERIORS, INC.
ARTICLE I
OFFICES
The principal office of the corporation in the State of Florida shall be located
in the City of Orlando, County of Orange. The corporation may have such other
offices, either within or without the State of Florida, as the board of
directors may designate or as the business of the corporation may require from
time to time.
ARTICLE II
SHAREHOLDERS
Section 1. ANNUAL MEETING. The annual meeting of the shareholders shall be
held on the 17th in the month of March in each year, beginning with the year
1995, at the hour of five o'clock P.M., or at such other time on such other day
within such months as shall be fixed by the board of directors, for the purpose
of electing directors and for the transaction of such other business as may come
before the meeting. If the day fixed for the annual meeting shall be a legal
holiday in the State of Florida, such meeting shall be held on the next
succeeding business day. If the election of directors shall not be held on the
day designated herein for any annual meeting of the shareholders, or at any
adjournment thereof, the board of directors shall cause the election to be held
at a special meeting of the shareholders as soon thereafter as conveniently may
be.
Section 2. SPECIAL MEETINGS. Special meetings of the shareholders for any
purpose or purposes, unless otherwise prescribed by statute, may be called by
the president or by the board of directors, and shall be called by the president
at the request of the holders of not less than one-tenth of all outstanding
shares of the corporation entitled to vote at the meeting.
Section 3. PLACE OF MEETING. The board of directors may designate any place,
either within or without the State of Florida as the place of meeting for any
annual meeting or for any special meeting called by the board of directors. A
waiver of notice signed by all shareholders entitled to vote at a meeting may
designate any place, either within or without the State of Florida as the place
for the holding of such meeting. If no designation is made, or if a special
meeting be otherwise called, the place of meeting shall be the principal office
of the corporation in the State of Florida.
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Section 4. NOTICE OF MEETING. Written notice stating the place, day and hour
of the meeting and, in case of a special meeting, the purpose or purposes for
which the meeting is called shall, unless otherwise prescribed by statute, be
delivered not less than ten nor more than sixty days before the date of the
meeting, either personally or by first class mail, by or at the direction of the
president, or the secretary, or the officer of other persons calling the
meeting, to each shareholder or record entitled to vote at such meeting. If
mailed, such notice shall be deemed to be delivered when deposited in the United
States mail, addressed to the shareholder at his address as it appears on the
stock transfer books of the corporation, with postage thereon prepaid.
Section 5. CLOSING OF TRANSFER BOOKS OR FIXING OF RECORD DATE. For the purpose
of determining shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or shareholders entitled to receive
payment of any dividend, or in order to make a determination of shareholders for
any other proper purpose, the board of directors of the corporation may provide
that the stock transfer books shall be closed for a stated period but not to
exceed, in any case, sixty days. If the stock transfer books shall be closed for
the purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for a least ten days
immediately preceding such meeting. In lieu of closing the stock transfer books,
the board of directors may fix in advance a date as the record date for any such
determination of shareholders, such date in any case to be not more than sixty
days and, in case of a meeting of shareholders, not less than ten days prior to
the date on which the particular action, requiring such determination of
shareholders, is to be taken. If the stock transfer books are not closed and no
record date is fixed for the determination of shareholders entitled to notice of
or to vote at a meeting of shareholders, or shareholders entitled to receive
payment of a dividend, the date on which notice of the meeting is mailed or the
date on which the resolution of the board of directors such dividend is adopted,
as the case may be, shall be the record date for such determination of
shareholders. When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof.
Section 6. VOTING RECORD. The officer or agent having charge of the stock
transfer books for shares of the corporation shall make, at least ten days
before each meeting of shareholders, a complete list of the shareholders
entitled to vote at such meeting of shareholders or any adjournment thereof,
arranged in alphabetical order, with the address of and the number of shares,
including classes and series, held by each. Such list, for a period of ten days
prior to such meeting, shall be kept on file at the registered office of the
corporation, at the principal place of the business of the corporation, or at
the office of the transfer agent or registrar of the corporation and shall be
subject to inspection by any shareholder at any time during usual business
hours. Such list shall also be produced and kept open at the time and place of
the meeting and shall be subject to the inspection of any shareholder during the
whole time of the meeting for the purposes thereof.
Section 7. QUORUM. A majority of the outstanding shares of the corporation
entitled to vote, represented in person or by proxy, shall constitute a quorum
at a meeting of shareholders. If less than a majority of the outstanding shares
are represented at a meeting, a majority of the shares so
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represented may adjourn the meeting from time to time without further notice.
At such adjourned meeting at which quorum shall be present and represented,
any business may be transacted which might have been transacted at the
meeting as originally noticed. The shareholders present at a duly organized
meeting may continue to transact business until adjournment, notwithstanding
the withdrawal of enough shareholders to leave less than a quorum.
Section 8. PROXIES. At all meetings of shareholders, a shareholder may vote in
person or by proxy executed in writing by the shareholder or by his duly
authorized attorney-in-fact. Such proxy shall be filed with the secretary of the
corporation before eleven months from the date of its execution, unless
otherwise provided in the proxy.
Section 9. VOTING OF SHARES. Subject to the provisions of Section 12 of this
Article II, each outstanding share entitled to vote shall be entitled to one
vote upon each matter submitted to a vote at a meeting of shareholders.
Section 10. VOTING OF SHARES BY CERTAIN HOLDERS. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as
the by-laws of such corporation may prescribe, or, in the absence of such
provision, as the board of directors of such other corporation may determine.
Shares held by an administrator, executor, guardian or conservator may be voted
by him, either in person or by proxy, without a transfer of such shares into his
name. Shares standing in the name of a trustee may be voted by him, either in
person or by proxy, but no trustee shall be entitled to vote shares hold by him
without a transfer of such shares into his name.
Shares standing in the name of a receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by such receiver
without the transfer thereof into his name if authority so to do be contained in
the appropriate order of the court by which such receiver was appointed.
A shareholder whose shares are pledged shall be entitled to vote such shares
until the shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
Neither treasury shares of its own stock held by the corporation, nor shares
held by another corporation if a majority of the shares entitled to vote for the
election of directors of such other corporation are hold by the corporation,
shall be voted at any meeting or counted in determining the total number of
outstanding shares at any given time for purposes of any meeting.
Section 11. INFORMAL ACTION BY SHAREHOLDERS. Any action required or permitted
to be taken at a meeting of the shareholders may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted.
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Section 12. CUMULATIVE VOTING. At each election for directors every
shareholder entitled to vote at such election shall have the right to vote, in
person or by proxy, the number of shares owned by him for as many persons as
there are directors to be elected and for whose election he has a right to vote,
or to cumulate his votes by giving one candidate as many votes as the number or
such directors multiplied by the number of shares shall equal, or by
distributing such votes on the same principle among any number of such
candidates.
ARTICLE III
BOARD OF DIRECTORS
Section 1. GENERAL POWERS. The business and affairs of the corporation shall
be managed by its board of directors.
Section 2. NUMBER, TENURE AND QUALIFICATIONS. The number of directors of the
corporation shall be two. Each director shall hold office until the next annual
meeting of shareholders and until his successor shall have been elected and
qualified. Directors need not be residents of the State of Florida or
shareholders of the corporation.
Section 3. REGULAR MEETINGS. A regular meeting of the board of directors shall
be held without other notice than this by-law immediately after, and at the same
place as, the annual meeting of shareholders. The board of directors may
provide, by resolution, the time and place, either within or without the State
of Florida, for the holding of additional regular meetings without other notice
than such resolution.
Section 4. SPECIAL MEETINGS. Special meetings of the board of directors may be
called by or at the request of the chairman of the board, or the president or
any two directors. The person or persons authorized to call special meetings of
the board of directors may fix any place, either within or without the state of
Florida, as the place for holding any special meeting of the board of directors
called by them.
Section 5. NOTICE. Notice of any special meeting shall be given at least two
days previously thereto by written notice delivered personally or mailed to each
director at his business address, or by telegram or cablegram. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
so addressed, with postage thereon prepaid. If notice be given by telegram or
cablegram, such notice shall be deemed to be delivered when the telegram is
delivered to the telegraph company. Any director may waive notice of any
meeting. The attendance of a director at a meeting shall constitute a waiver of
notice of any meeting. The attendance of a director at a meeting shall
constitute a waiver of notice of such meeting, except where a director attends a
meeting for the express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
board of directors need by specified in the notice or waiver of notice of such
meeting.
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Section 6. QUORUM. A majority of the number of directors fixed by Section 2 of
this Article III shall constitute a quorum for the transaction of business at
any meeting of the board of directors, but if less than such majority is present
at the meeting, a majority of the directors present may adjourn the meeting from
time to time without further notice.
Section 7. MANNER OF ACTING. The act of the majority of the directors present
at a meeting at which a quorum is present shall be the act of the board of
directors.
Section 8. ACTION WITHOUT A MEETING. Any action required or permitted to be
taken by the board of directors at a meeting may be taken by the board of
directors at a meeting may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all of the-directors.
Section 9. VACANCIES. Any vacancy occurring in the board of directors may be
filled by the affirmative vote of a majority of the remaining directors though
less than a quorum of the board of directors. A director elected to fill a
vacancy shall be elected for the unexpired term of his predecessor in office.
Any directorship to be filled by reason of an increase in the number of
directors may be filled by election by the board of directors for a term of
office continuing only until the next election of directors by the shareholders.
Section 10. COMPENSATION. By resolution of the board of directors, each
director may be paid his expenses, if any, of attendance at each meeting of the
board of directors, and may be paid a stated salary as director of a fixed sum
for attendance at each meeting of the board of directors or both. No such
payment shall preclude any director from serving the corporation in any other
capacity and receiving compensation therefore. Directors may set their own
compensation for service as officers as well as for service as directors.
Section 11. PRESUMPTION OF ASSENT. A director of the corporation who is
present at a meeting of the board of directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless he
votes against such action or abstains from voting in respect thereto because of
an asserted conflict of interest.
ARTICLE IV
OFFICERS
Section 1. NUMBER. The officers of the corporation shall be a president, one
or more vice-presidents (the number thereof to be determined by the board of
directors), a secretary, and a treasurer, each of whom shall be elected by the
board of directors. Such other officers and assistant officers as may be deemed
necessary may be elected or appointed by the board of directors. Any two or more
offices may be held by the same person.
Section 2. ELECTION AND TERM OF OFFICE. The officers of the corporation to be
elected by the board of directors shall be elected annually by the board of
directors at the first meeting of the board of directors held after each annual
meeting of the shareholders. If the election of
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officers shall not be held at such meeting, such election shall be held as
soon thereafter as conveniently may be. Each officer shall hold office until
his successor shall have been duly elected and shall have qualified or until
his death or until he shall resign or shall have been removed in the manner
hereinafter provided.
Section 3. REMOVAL. Any officer or agent may be removed by the board of
directors whenever in its judgment the best interests of the corporation will be
served thereby, but such removal shall be without prejudice to the contract
rights, if any, of the person so removed. Election or appointment of an officer
or agent shall not of itself create contract rights.
Section 4. VACANCIES. A vacancy in any office because of death, resignation,
removal, disqualification or otherwise, may be filled by the board of directors
for the unexpired portion of the term.
Section 5. PRESIDENT. The president shall be the principal executive
officer of the corporation and, subject to the control of the board of
directors, shall in general supervise and control all of the business and
affairs of the corporation. He shall, when present, preside at all meetings
of the shareholders and of the board of directors. He may sign, with the
secretary or any other proper officer of the corporation thereunto authorized
by the board of directors, certificates for shares of the corporation and
deeds, mortgages, bonds, contracts, or other instrument which the board of
directors has authorized to be executed, except in cases where the signing
and execution thereof shall be expressly delegated by the board of directors
or by these By-Laws to some other officer or agent of the corporation, or
shall be required by law to be otherwise signed or executed; and in general
shall perform all duties as may be prescribed by the board of directors from
time to time.
Section 6. THE VICE-PRESIDENT. In the absence of the president or in the event
of his death, inability or refusal to act, the vice-president (or in the event
there be more than one vice-president, the vice-presidents in the order
designated at the time of their election, or in the absence of any designation,
then in the order of their election) shall perform the duties of the president,
and when so acting, shall have all the powers of and be subject to all the
restrictions upon the president. Any vice-president may sign, with the secretary
or an assistant secretary, certificates for shares of the corporation; and shall
perform such other duties as from time to time may be assigned to him by the
president or by the board of directors.
Section 7. THE SECRETARY. The secretary shall: (a) keep the minutes of the
proceedings of the shareholders and of the board of directors in one or more
books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these By-Laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d)
keep a register of the post office address of each shareholder which shall be
furnished to the secretary by such shareholder; (e) sign with the president,
or a vice-president, certificates for share of the corporation, the issuance
of which shall have been authorized by resolution of the board of directors;
(f) have general charge of the stock transfer books of the corporation; and
(g) in general perform all duties incident to the office of
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secretary and such other duties as from time to time may be assigned to him
by the president or by the board of directors.
Section 8. THE TREASURER. The Treasurer shall: (a) have charge and custody of
and be responsible for all funds and securities of the corporation; (b) receive
and give receipts for moneys due and payable to the corporation from any source
whatsoever, and deposit all such moneys in the name of the corporation in such
banks, trust companies or other depositories as shall be selected in accordance
the provisions of Article V of these By-Laws, and (c) in general perform all of
the duties as from time to time may be assigned to him by the president or by
the board of directors. If required by the board of directors, the treasurer
shall give a bond for the faithful discharge of his duties in such sum and with
such surety or sureties as the board of directors shall determine.
Section 9. ASSISTANT SECRETARIES AND ASSISTANT TREASURERS. The assistant
secretaries, when authorized by the board of directors, may sign with the
president or a vice-president certificates for shares of the corporation the
issuance of which shall have been authorized by a resolution of the board of
directors. The assistant treasurers shall respectively, if required by the board
of directors, give bonds for the faithful discharge of their duties in such sums
and with such sureties as the board of directors shall determine. The assistant
secretaries and assistant treasurers, in general shall perform such duties as
shall be assigned to them by the secretary or the treasurer, respectively, or by
the president or the board of directors.
Section 10. SALARIES. The salaries of the officers shall be fixed from time to
time by the board of directors and no officer shall be prevented from receiving
such salary by reason of fact that he is also a director of the corporation.
ARTICLE V
CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 1. CONTRACTS. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation, and such authority
may be general or confined to specific instances.
Section 2. LOANS. No loans shall be contracted on behalf of the corporation
and no evidences of indebtedness shall be issued in its name unless authorized
by a resolution of the board of directors. Such authority may be general or
confined to specific instances.
Section 3. CHECKS, DRAFTS, ETC. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
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Section 4. DEPOSITS. All funds of the corporation not otherwise employed shall
be deposited from time to time to the credit of the corporation in such banks,
trust companies or other depositories as the board of directors may select.
ARTICLE VI
CERTIFICATES FOR SHARES AND THEIR TRANSFER
Section 1. CERTIFICATES FOR SHARES. Certificates representing shares of the
corporation shall be in such form as shall be determined by the board of
directors. Such certificates shall be signed by the president or a
vice-president and by the secretary or an assistant secretary and sealed with
the corporate seal or a facsimile thereof. The signatures of such officers
upon a certificate may be facsimiles if the certificate is manually signed on
behalf of a transfer agent or a registrar, other than the corporation itself
or one of its employees. Each certificate for shares shall be consecutively
numbered or otherwise identified. The name and address of the person to whom
the shares represented thereby are issued, with the number of shares and date
of issue, shall be entered on the stock transfer books of the corporation.
All certificates surrendered to the corporation for transfer shall be
cancelled and no new certificate shall be issued until the former certificate
for a like number of shares shall have been surrendered and cancelled, except
that in case of a lost, destroyed or mutilated certificate a new one may be
issued therefore upon such terms and indemnity to the corporation as the
board of directors may prescribe.
Section 2. TRANSFER OF SHARES. Transfer of shares of the corporation shall be
made only on the stock transfer books of the corporation by the holder of record
thereof or by this legal representative, who shall furnish proper evidence of
authority to transfer or by his attorney thereunto authorized by power of
attorney duly executed and filed with the secretary of the corporation, and on
surrender for cancellation of the certificate for such shares. The person in
whose name shares stand on the books of the corporation shall be deemed by the
corporation to be the owner thereof for all purposes.
ARTICLE VII
FISCAL YEAR
The fiscal year of the corporation shall begin on the first day of January and
end on the thirty-first day of December in each year.
ARTICLE VIII
DIVIDENDS
The board of directors may, from time to time, declare and the corporation may
pay dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law and the Articles of Incorporation.
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ARTICLE IX
CORPORATE SEAL
The board of directors shall provide a corporate seal which shall be circular in
form and shall have inscribed thereon the name of the corporation and the state
of incorporation and the words "Corporate Seal".
ARTICLE X
AMENDMENTS
These By-Laws may be altered, amended or repealed and new By-Laws may be adopted
by the board of directors or by the shareholders at any regular or special
meeting.
ARTICLE XI
WAIVER OF NOTICE
Whenever any notice is required to be given to any shareholder or director of
the corporation under the provisions of these By-Laws or under the provisions of
the Articles of Incorporation or under the provisions of the ICI Corporation
Law, a waiver thereof in writing signed by the person or persons entitled to
such notice whether before or after the time stated therein shall be deemed
equivalent lo the giving of such notice.
ARTICLE XII
EXECUTIVE COMMITTEE
Section 1. Appointment. The board of directors by resolution adopted by a
majority of the full board, may designate two or more of its members to
constitute an executive committee. The designation of such committee and the
delegation thereto of authority shall not operate to relieve the board of
directors, or any member thereof, of any responsibility imposed by law.
Section 2. Authority. The executive committee, when the board of directors is
not in session shall have and may exercise all of the authority of the board of
directors except to the extent, if any, that such authority shall be limited by
the resolution appointing the executive committee and except also that the
executive committee shall not have the authority of the board of directors to
approve or recommend to shareholders action or proposals required by this act to
be approved by shareholders; designate candidate for the office of director, for
purposes of proxy solicitation, or otherwise, fill vacancies on the board of
directors or any committee thereof; amend by-laws; authorize or approve the
reacquisition of shares unless pursuant to a general formula or method specified
by the board of directors; or authorize or approve the issuance or sale of, or
any contract to issue or sell, shares or designate the terms of a series of a
class of shares, except as provided by the State of Florida General Corporation
Law.
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Section 3. Tenure and Qualifications. Each member of the executive committee
shall hold office until the, next regular annual meeting of the board of
directors following his designation and until his successor is designated as a
member of the executive committee and is elected and qualified.
Section 4. Meetings. Regular meetings of the executive committee may be held
without notice at such times and places as the executive committee may fix from
time to time by resolution. Special meetings of the executive committee may be
called by any member thereof upon not less than one day's notice stating the
place, date and hour of the meeting, which notice may be written or oral, and if
mailed, shall be deemed to be delivered when deposited in the United States mail
addressed to the member of the executive committee at his business address. Any
member of the executive committee may waive notice of any meeting and no notice
of any meeting need be given to any member thereof who attends in person. The
notice of a meeting of the executive committee need not state the business
proposed to be transacted at the meeting.
Section 5. Quorum. A majority of the members of the executive committee shall
constitute a quorum for the transaction of business at any meeting thereof, and
action of the executive committee must be authorized by the affirmative vote of
a majority of the members present at a meeting at which a quorum is present.
Section 6. Action Without a Meeting. Any action required or permitted to be
taken by the executive committee at a meeting may be taken without a meeting if
a consent in writing, setting forth the action so taken, shall be signed by all
of the Members of the executive committee.
Section 7. Vacancies. Any vacancy in the executive committee may be filled by
a resolution adopted by a majority of the full board of directors.
Section 8. Resignations and Removal. Any member of the executive committee may
be removed at any time with or without cause by resolution adopted by a majority
of the full board of directors. Any member of the executive committee may resign
from the executive committee at any time by giving written notice to the
president or secretary of the corporation, and unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.
Section 9. Procedure. The executive committee shall elect a presiding officer
from its members and may fix its own rules of procedure which shall not be
inconsistent with these By-Laws. It shall keep regular minutes of its
proceedings and report the same to the board of directors for its information at
the meeting thereof held next after the proceedings shall have been taken.
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EXHIBIT 21.1
LIST OF SUBSIDIARIES OF REGISTRANT
SUBSIDIARIES OF DECRANE AIRCRAFT HOLDINGS, INC.
AEROSPACE DISPLAY SYSTEMS, INC., a Delaware corporation.
AUDIO INTERNATIONAL SALES, INC., a U. S. Virgin Islands corporation.
AUDIO INTERNATIONAL, INC., an Arkansas corporation.
AVTECH CORPORATION, a Washington corporation.
CORY COMPONENTS, INC., a California corporation.
CWP ACQUISITION, INC., a Delaware corporation.
DETTMERS INDUSTRIES, INC., a Delaware corporation.
ELSINORE AEROSPACE SERVICES, INC., a California corporation.
ELSINORE ENGINEERING, INC., a Delaware corporation.
FLIGHT REFUELING, INC., a Maryland corporation.
HOLLINGSEAD INTERNATIONAL, INC., a California corporation.
HOLLINGSEAD INTERNATIONAL, LTD., a UK company.
INTERNATIONAL CUSTOM INTERIORS, INC., a Florida corporation.
PATRICK AIRCRAFT TANK SYSTEMS, INC., a Maryland corporation.
PATS AIRCRAFT AND ENGINEERING CORPORATION, a Maryland corporation.
PATS SUPPORT, INC., a Maryland corporation.
PATS, INC., a Maryland corporation.
PCI ACQUISITION CO., INC., a Delaware Corporation.
PPI HOLDINGS, INC., a Kansas corporation.
PRECISION PATTERN, INC., a Kansas corporation.
TRI-STAR ELECTRONICS EUROPE S.A., a Swiss company.
TRI-STAR ELECTRONICS INTERNATIONAL, INC., a California corporation.
TRI-STAR TECHNOLOGIES, a California general partnership.
