<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED NOVEMBER 30, 1996
COMMISSION FILE NUMBER 33-80770
SIGNAL INVESTMENT & MANAGEMENT CO.
A DELAWARE CORPORATION
I.R.S. EMPLOYER IDENTIFICATION NO. 62-1290284
1105 NORTH MARKET, SUITE 1300
WILMINGTON, DELAWARE 19890
TELEPHONE: 302-656-3950
THIS REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION J(1)
(a) AND (b) OF FORM 10-K AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.
INDICATE BY CHECK MARK WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS
REQUIRED TO BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 DURING THE PRECEDING 12 MONTHS (OR FOR SUCH SHORTER PERIOD THAT THE
REGISTRANT WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO
SUCH FILING REQUIREMENTS FOR THE PAST 90 DAYS. YES X . NO .
--- ---
AS OF FEBRUARY 21, 1997, 250 SHARES OF THE COMPANY'S COMMON STOCK, WITHOUT
PAR VALUE, WERE OUTSTANDING.
<PAGE>
PART I
ITEM 1. BUSINESS
GENERAL
Signal Investment & Management Co. (the "Company") was incorporated in 1986.
The Company is a wholly-owned subsidiary of Chattem, Inc. ("Chattem"). The
Company was formed by Chattem for the sole purpose of holding certain of
Chattem's trademarks and other purchased product rights and certain
investments. The Company owns or licenses substantially all of the trademarks
and intangibles associated with Chattem's consumer products business and
licenses Chattem's use thereof. In exchange for this license, Chattem pays
to the Company a royalty on net sales of licensed products. The Company has
no active operations.
On April 29, 1996, the Company and Chattem purchased the worldwide rights for
the GOLD BOND line of medicated powders and anti-itch creams. The purchase
price for the trademarks and inventory, was $40,000,000. Additionally,
Chattem assumed certain liabilities of approximately $500,000. The trademark
was acquired by the Company and licensed to Chattem. Inventory and certain
assumed liabilities were acquired by Chattem. Concurrently with the closing
of the acquisition, Chattem entered into a $61,500,000 bank credit agreement
and issued 1,100,000 new shares of Chattem common stock to a group of
investors, including certain officers, directors and affiliates and issued to
the seller 155,792 shares of Chattem stock at $6.42 per share. The proceeds
of the financing were used to fund the GOLD BOND acquisition and repay all
existing bank indebtedness of Chattem.
On June 6, 1996, the Company and Chattem purchased the rights for the
HERPECIN-L line of medicated lip balm. The purchase price for the trademark,
receivables and inventory was $5,607,000 plus a royalty payment equal to the
greater of $214,000 or 5% of net sales. Additionally, Chattem assumed certain
liabilities of approximately $500,000. The trademark was acquired by the
Company and licensed to Chattem. Receivables and inventory were acquired by
Chattem. The royalty payment is payable annually for each of the seven
twelve-month periods beginning July 1, 1996 and ending June 30, 2003. The
purchase was financed by Chattem with a $5,000,000 addition to its existing
bank credit agreement and the remaining $607,000 was funded by Chattem.
The Company is a guarantor of Chattem's $75,000,000 12.75% Series B Senior
Subordinated Notes (the "Notes") due 2004, which guaranty and notes were
registered under the Securities Act of 1933 on a Form S-2 Registration
Statement effective August 4, 1994. During 1995, Chattem prepaid
approximately $8,000,000 of the Notes with funds received from the sale of
Chattem's specialty chemicals division.
The Company is also guarantor of Chattem's $66,500,000 bank credit facility
which consists of term loans and working capital revolving loans maturing at
various dates from April 2001 to October 2003.
-2-
<PAGE>
TRADEMARKS
The Company's trademarks are its most important asset, although, except for
GOLD BOND, FLEXALL, PHISODERM and ICY HOT, its business as a whole is not
materially dependent upon ownership of any one trademark. The Company owns
or licenses substantially all of the trademarks associated with Chattem's
domestic consumer products business. The Company's significant domestic
trademarks have been registered on the principal register of the United
States Patent and Trademark Office. Federally registered trademarks have a
perpetual life as long as they are renewed in a timely manner and used
properly as trademarks, subject to the right of third parties to seek
cancellation of the marks.
EMPLOYEES
The Company has no employees.
ITEM 2. PROPERTIES
None.
ITEM 3. LEGAL PROCEEDINGS
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not required pursuant to reduced disclosure conditions set forth in General
Instruction J(2) (c) of Form 10-K.
-3-
<PAGE>
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
None.
ITEM 6. SELECTED FINANCIAL DATA
Not required pursuant to reduced disclosure conditions set forth in General
Instruction J(2) (a) of Form 10-K.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FISCAL 1996 COMPARED TO FISCAL 1995
The following narrative represents management's comparative analysis of the
fiscal year ended November 30, 1996 to the fiscal year ended November 30,
1995 results of operations of the Company pursuant to General Instruction
J(2) (a) of Form 10-K:
Interest income from the note receivable from Chattem decreased by $45,000
(or 25%) in fiscal 1996 from fiscal 1995 as a result of Chattem's repayment
of the note in the fourth quarter of fiscal 1996.
Royalty income increased by $844,000 (or 20%) in fiscal 1996 from fiscal 1995
primarily due to the acquisition of GOLD BOND in the second quarter of 1996
and HERPECIN-L in the third quarter of 1996.
The Company recognized a gain of $875,000 on the sale of two brands, SOLTICE
and BLIS-TO-SOL in 1996.
The Company recognized a gain of $323,000 on the sale of an investment in
1996.
Amortization expense increased by $617,000 (or 53%) in fiscal 1996 from
fiscal 1995 primarily due to the acqusition of the trademarks for GOLD BOND
and HERPECIN-L.
FISCAL 1995 COMPARED TO FISCAL 1994
The following narrative represents management's comparative analysis of the
fiscal year ended November 30, 1995 to the fiscal year ended November 30,
1994 results of operations of the Company pursuant to General Instruction
J(2) (a) of Form 10-K:
Interest income from the note receivable from Chattem increased by $33,000
(or 22%) in fiscal 1995 from fiscal 1994 as a result of the recognition of a
full year of interest on the Chattem note receivable, which originated in the
second quarter of fiscal 1994.
Royalty income increased by $250,000 (or 6%) in fiscal 1995 from fiscal 1994
primarily due to recognition of a full year of sales by Chattem of PHISODERM,
acquired in the third quarter of fiscal 1994, and BENZODENT, acquired in the
second quarter of fiscal 1994.
Amortization expense increased by $223,000 (or 24%) in fiscal 1995 from
fiscal 1994 primarily due to recognition of a full year of amortization on
the trademarks for PHISODERM, acquired in the third quarter of fiscal 1994,
and BENZODENT, acquired in the second quarter of fiscal 1994.
-4-
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
See page 6 for the Company's index to its financial statements.
ITEM 9. CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
-5-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO. INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Report of Independent Public Accountants 7
Balance Sheets as of November 30, 1996 and 1995 8
Statements of Income for the years ended November 30, 1996, 1995 and 1994 9
Statements of Shareholder's Equity for the years ended November 30, 1996,
1995 and 1994 10
Statements of Cash Flows for the years ended November 30, 1996, 1995 and 1994 11
Notes to Financial Statements 12
</TABLE>
-6-
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholder and Board of Directors of
Signal Investment & Management Co.:
We have audited the accompanying balance sheets of SIGNAL INVESTMENT &
MANAGEMENT CO. (a Delaware corporation and wholly owned subsidiary of
Chattem, Inc.) as of November 30, 1996 and 1995 and the related statements of
income, shareholder's equity and cash flows for each of the three years in
the period ended November 30, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Signal Investment &
Management Co. as of November 30, 1996 and 1995 and the results of its
operations and its cash flows for each of the three years in the period ended
November 30, 1996 in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Chattanooga, Tennessee
January 17, 1997
-7-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
BALANCE SHEETS
NOVEMBER 30, 1996 AND 1995
(IN THOUSANDS, EXCEPT SHARE DATA)
ASSETS
<TABLE>
<CAPTION>
1996 1995
-------- --------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 2,911 $ 851
Royalties receivable from Chattem, Inc. 1,287 1,021
Note receivable from Chattem, Inc. 0 2,500
Interest receivable from Chattem, Inc. 0 121
------- -------
Total current assets 4,198 4,493
TRADEMARKS AND OTHER PURCHASED PRODUCT
RIGHTS, NET 74,086 30,054
-------- --------
Total assets $78,284 $34,547
-------- --------
-------- --------
LIABILITIES AND SHAREHOLDER'S EQUITY
PAYABLE TO CHATTEM, INC. $75,713 $29,844
-------- --------
DEFERRED INCOME TAXES 1,556 874
-------- --------
COMMITMENTS AND CONTINGENCIES (NOTES 1 AND 4)
SHAREHOLDER'S EQUITY:
Common shares, without par value, 500 shares authorized,
250 shares issued and outstanding 2 2
Retained earnings 1,013 3,827
-------- --------
Total shareholders' equity 1,015 3,829
-------- --------
Total liabilities and shareholders' equity $78,284 $34,547
-------- --------
-------- --------
The accompanying notes are an integral part of these balance sheets.
</TABLE>
-8-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
STATEMENTS OF INCOME
FOR THE YEARS ENDED NOVEMBER 30, 1996, 1995, AND 1994
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
REVENUES:
Royalties from Chattem, Inc. $ 5,044 $4,200 $3,950
Investment income:
Interest 33 23 16
Interest from Chattem, Inc. note receivable 136 181 148
Gain on sale of investment 323 0 0
Gain on product divestitures 875 0 0
------- ------ ------
Total revenues 6,411 4,404 4,114
------- ------ ------
EXPENSES:
Amortization of trademarks and other purchased product rights 1,779 1,162 939
Other 18 11 0
------- ------ ------
Total expenses 1,797 1,173 939
------- ------ ------
INCOME BEFORE PROVISION FOR INCOME TAXES 4,614 3,231 3,175
PROVISION FOR INCOME TAXES 1,575 1,091 1,074
------- ------ ------
NET INCOME $ 3,039 $2,140 $2,101
------- ------ ------
------- ------ ------
NET INCOME PER COMMON SHARE $12,156 $8,560 $8,404
------- ------ ------
------- ------ ------
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 250 250 250
------- ------ ------
------- ------ ------
</TABLE>
The accompanying notes are an integral part of these statements.
-9-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
STATEMENTS OF SHAREHOLDER'S EQUITY
FOR THE YEARS ENDED NOVEMBER 30, 1996, 1995, AND 1994
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
COMMON RETAINED
SHARES EARNINGS
------ --------
<S> <C> <C>
BALANCE, NOVEMBER 30, 1993 $2 $5,586
Net income 0 2,101
Dividends ($8,000 per share) 0 (2,000)
------ ------
BALANCE, NOVEMBER 30, 1994 2 5,687
Net income 0 2,140
Dividends ($16,000 per share) 0 (4,000)
------ ------
BALANCE, NOVEMBER 30, 1995 2 3,827
Net income 0 3,039
Dividends ($23,412 per share) 0 (5,853)
------ ------
BALANCE, NOVEMBER 30, 1996 $2 $1,013
------ ------
------ ------
</TABLE>
The accompanying notes are an integral part of these statements.
-10-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED NOVEMBER 30, 1996, 1995, AND 1994
(IN THOUSANDS)
<TABLE>
<CAPTION>
1996 1995 1994
------ ------ ------
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net income $ 3,039 $ 2,140 $ 2,101
Adjustments to reconcile net income to net cash provided by operating
activities:
Amortization 1,779 1,162 939
Deferred income tax provision 682 366 174
Proceeds from sale of investment 323 0 0
Gain on sale of investment (323) 0 0
Gain on product divestitures (875) 0 0
Changes in operating assets and liabilities:
(Increase) decrease in royalties receivable from
Chattem, Inc. (266) 51 (408)
(Increase) decrease in interest receivable from
Chattem, Inc. 121 (84) (37)
------- ------- -------
Net cash provided by operating activities 4,480 3,635 2,769
------- ------- -------
INVESTING ACTIVITIES:
(Addition) payment of note receivable from Chattem, Inc. 2,500 0 (2,500)
------- ------- -------
FINANCING ACTIVITIES:
Net increase in payable to Chattem, Inc. 933 740 402
Dividends paid to Chattem, Inc. (5,853) (4,000) (2,000)
------- ------- -------
Net cash used in financing activities (4,920) (3,260) (1,598)
------- ------- -------
CASH AND CASH EQUIVALENTS:
Increase (decrease) for the year 2,060 375 (1,329)
At beginning of year 851 476 1,805
------- ------- -------
At end of year $ 2,911 $ 851 $ 476
------- ------- -------
------- ------- -------
</TABLE>
The accompanying notes are an integral part of these statements.
-11-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 30, 1996 AND 1995
(ALL MONETARY AMOUNTS ARE EXPRESSED IN
THOUSANDS OF DOLLARS UNLESS CONTRARILY EVIDENT)
1. GENERAL
Signal Investment & Management Co. ("Signal" or the "Company") is a
wholly-owned subsidiary of Chattem, Inc. ("Chattem"). Signal was formed
by Chattem for the sole purpose of holding certain of Chattem's trademarks
and other purchased product rights and certain investments. The Company
owns or licenses substantially all of the trademarks and intangibles
associated with Chattem's domestic consumer products business and licenses
Chattem's use thereof. Signal has no active operations.
Signal is a guarantor of Chattem's $75,000 12.75% Senior Subordinated Notes
(the "Notes") due 2004, which guaranty and notes were registered under the
Securities Act of 1933 on a Form S-2 Registration Statement effective
August 4, 1994.
Signal is also guarantor of Chattem's $66,500 bank credit facility which
consists of term loans and working capital revolving loans maturing at
various dates from April 2001 to October 2003.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
TRADEMARKS AND OTHER PURCHASED PRODUCT RIGHTS
The costs of acquired trademarks and other purchased product rights are
capitalized and amortized over periods ranging from 20 to 40 years. Total
accumulated amortization of these assets at November 30, 1996 and 1995 was
$5,060 and $3,281, respectively. Amortization expense for 1996, 1995, and
1994 was $1,779, $1,162, and $939, respectively.
INCOME TAXES
The Company uses the asset and liability approach to accounting for
deferred income taxes based on currently enacted tax rates and differences
in financial reporting and income tax bases of assets and liabilities.
INVESTMENTS
In March 1996, the Company sold for $323 an investment which had been
written down to a carrying value of zero in 1993 due to uncertainty
concerning future realization.
-12-
<PAGE>
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 revenue and expenses
during the reporting period. Actual results could differ from those
estimates.
CASH AND CASH EQUIVALENTS
The Company considers all short-term deposits and investments with
original maturities of three months or less to be cash equivalents.
RECLASSIFICATIONS
Certain prior year amounts have been reclassified to conform with the 1996
financial statements' presentation.
3.INCOME TAXES
The provision for income taxes includes the following components for the
years ended November 30:
1996 1995 1994
------ ------ ------
Current $ 893 $ 725 $ 900
Deferred 682 366 174
------ ------ ------
$1,575 $1,091 $1,074
------ ------ ------
------ ------ ------
The temporary difference which gives rise to the deferred tax liability at
November 30, 1996 and 1995 consists primarily of the differences between
carrying values of trademarks and other purchased product rights for
income tax and financial statement reporting purposes.
The difference between the provision for income taxes and the amount
computed by multiplying income before income taxes by the U.S. statutory
rate is summarized as follows for the year ended November 30:
1996 1995 1994
------ ------ ------
Expected tax provision $1,584 $1,098 $1,080
Nontaxable interest income (9) (7) (5)
Other, net 0 0 (1)
------ ------ ------
$1,575 $1,091 $1,074
------ ------ ------
------ ------ ------
-13-
<PAGE>
4. ACQUISITION AND SALE OF TRADEMARKS
On May 12, 1994, the Company acquired the BENZODENT (a topical analgesic)
trademark for approximately $3,200 from The Proctor & Gamble Company, and
subsequently licensed the use of the trademark to Chattem. The purchase
of the BENZODENT trademark was financed with borrowings from Chattem.
On June 17, 1994, the Company acquired a license to the PHISODERM
trademark in the United States, Canada, and Puerto Rico, together with
certain other assets from Sterling Winthrop Inc. ("Sterling"). The
purchase price for the license of PHISODERM was approximately $16,826. If
net sales of PHISODERM products in the United States, by Chattem only,
exceed $11,000 for either of the 12-month periods beginning July 1, 1995
and July 1, 1996 and ending June 30, 1996 and June 30, 1997, the Company
will pay Sterling an additional $1,000 per year. Net sales of PHISODERM
products exceeded $11,000 for the 12-month period ended June 30, 1996. As
a result, an additional $1,000 is reflected in trademarks and other
purchased products rights at November 30, 1996.
On April 29, 1996, the Company purchased the worldwide rights for the GOLD
BOND line of medicated powders and anti-itch cream, and subsequently
licensed the use of the trademark to Chattem. The purchase price for the
trademark was $38,000 which was financed with borrowings from Chattem.
On June 6, 1996, the Company purchased the rights for the HERPECIN-L line
of medicated lip balm, and subsequently licensed the use of the trademark
to Chattem. The purchase price for the trademark was $5,159 plus a
royalty payment equal to the greater of $214 or 5% of net sales. The
royalty payment is payable annually for each of the seven twelve-month
periods beginning July 1, 1996 and ending June 30, 2003. The purchase of
the HERPECIN -L trademark was financed with borrowings from Chattem.
During April, 1996, the Company sold the trademarks of two minor
consumer products brands, SOLTICE and BLIS-TO-SOL. The sales price of
$1,200 consisted of $1,000 of cash received at closing and a $200 promissory
note requiring payments of $100 per year for the next two years contingent
upon the brands meeting specific future sales levels.
5. RELATED PARTY TRANSACTIONS
In exchange for the licensed use of the Company's trademarks, the Company
receives royalties from Chattem of 5% of net sales of certain defined
domestic consumer products.
Note receivable from Chattem, Inc. results from borrowings by Chattem.
The note bears interest at 7 1/4% which is payable quarterly. The note
and all accrued interest were repaid by Chattem in fiscal 1996.
Payable to Chattem, Inc. represents net advances received from Chattem
used to fund the acquisitions of trademarks as discussed in Note 4. Such
advances are noninterest bearing and are not expected to be paid prior to
November 30, 1997.
Certain general and administrative expenses of the Company are paid by
Chattem on behalf of the Company. Such amounts are not significant.
-14-
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Not required pursuant to reduced disclosure conditions set forth in General
Instruction J(2) (c) of Form 10-K.
ITEM 11. EXECUTIVE COMPENSATION
Not required pursuant to reduced disclosure conditions set forth in General
Instruction J(2) (c) of Form 10-K.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Not required pursuant to reduced disclosure conditions set forth in General
Instruction J(2) (c) of Form 10-K.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Not required pursuant to reduced disclosure conditions set forth in General
Instruction J(2) (c) of Form 10-K.
-15-
<PAGE>
PART IV
ITEM 14. REPORTS ON FORM 8-K
No reports on Form 8-K were filed with the Securities and Exchange Commission
during the three months ended November 30, 1996.
The following documents are filed or incorporated by reference as exhibits to
this report.
<TABLE>
<CAPTION>
Exhibit Number Description of Exhibit Reference
- -------------- ---------------------- ---------
<S> <C> <C>
3 Certificate of Incorporation (5)
By-laws (5)
4 Form of Indenture dated August 3, 1994 between
Chattem, Inc., Signal Investment & Management
Co., as guarantor and SouthTrust Bank NA relating
to the 12.75% Senior Subordinated Notes (1)
10 Asset Purchase and Sale Agreement dated June 17,
1994 between Sterling Winthrop Inc. and Signal
Investment & Management Co. for the PHISODERM
business (2)
Asset Purchase Agreement dated April 10, 1996
between Martin Himmel Inc., seller, and Chattem,
Inc. and Signal Investment & Management Co., as
purchasers, for the GOLD BOND business (3)
Credit Agreement dated April 29, 1996, among
Chattem, Inc., as borrower, Signal Investment &
Management Co., as guarantor, NationsBank, N.A.
as agent and the lenders named therein (4)
Credit Agreement (secondary working capital facility)
among Chattem, Inc., as borrower, Signal Investment
& Management Co., as guarantor, NationsBank, N.A. as
agent and the lenders named therein (4)
</TABLE>
- 16 -
<PAGE>
<TABLE>
<CAPTION>
Exhibit Number Description of Exhibit Reference
- -------------- ---------------------- ---------
<S> <C> <C>
10 Asset Purchase Agreement dated June 6, 1996
between Campbell Laboratories Inc., seller,
and Chattem, Inc. and Signal Investment &
Management Co., purchasers, for the
HERPECIN-L business (4)
Amendment to the Credit Agreement (HERPECIN-L
Acquisition) among Chattem, Inc., as borrower,
Signal Investment & Management Co., as guarantor,
NationsBank, N.A., as agent and the lenders
named therein (4)
REFERENCES -
Previously filed as an exhibit to and incorporated by reference from:
(1) Form S-2 Registration Statement (No. 33-80770) of Chattem, Inc.
(2) Form 10-K for Chattem, Inc. for the year ended November 30, 1994.
(3) Form 8-K for Chattem, Inc. dated April 29, 1996.
(4) Form 10-K for Chattem, Inc. for the year ended November 30, 1996.
(5) Form 10-K for Signal Investment & Management Co. for the year ended
November 30, 1996.
</TABLE>
- 17 -
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
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.
SIGNAL INVESTMENT & MANAGEMENT CO.
(Registrant)
Dated: FEBRUARY 21, 1997 /s/ ROBERT E. BOSWORTH
----------------- ------------------------------
Robert E. Bosworth,
President and Director
(principal executive officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the registrant
and in the capacities and on the date indicated.
Dated: FEBRUARY 21, 1997 /s/ ROBERT E. BOSWORTH
----------------- -------------------------------------
Robert E. Bosworth,
President and Director
(principal executive officer)
Dated: FEBRUARY 21, 1997 /s/ STEPHEN M. POWELL
----------------- -------------------------------------
Stephen M. Powell,
Vice President, Treasurer and Director
(principal financial officer)
Dated: FEBRUARY 21, 1997 /s/ ERIK L. SAVILLE
----------------- -------------------------------------
Erik L. Saville,
Assistant Vice President and Director
Dated: FEBRUARY 21, 1997 /s/ HUGH F. SHARBER
----------------- -------------------------------------
Hugh F. Sharber,
Secretary and Director
-18-
<PAGE>
SIGNAL INVESTMENT & MANAGEMENT CO.
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
-------- ---------------------------------------------
3.1 Certificate of Incorporation
3.2 By-Laws
<PAGE>
EXHIBIT 3.1
STATE OF DELAWARE
[SEAL] BOOK 384 PAGE 338
OFFICE OF SECRETARY OF STATE
-----------------------
I, MICHAEL HARKINS, SECRETARY OF STATE OF THE STATE OF DELAWARE DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
INCORPORATION OF SIGNAL INVESTMENT & MANAGEMENT CO. FILED IN THIS OFFICE ON
THE TWENTY-SEVENTH DAY OF JUNE, A.D. 1986, AT 11 O'CLOCK A.M.
[SEAL]
/s/ Michael Harkins
---------------------
Michael Harkins, Secretary of State
AUTHENTICATION: 10868284
DATE: 06/27/1986
726178101
<PAGE>
726178101
BOOK 384 PAGE 339
CERTIFICATE OF INCORPORATION FILED
JUN 27 1986
OF 11 AM
Michael Harkins
Signal Investment & Management Co. SECRETARY OF STATE
1. The name of the corporation is:
Signal Investment & Management Co.
2. The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is to engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of Delaware.
4. The total number of shares of stock which the corporation shall
have authority to issue is five hundred (500); all of such shares shall be
without par value.
5. The board of directors is authorized to make, alter or repeal
the by-laws of the corporation. Election of directors need not be by written
ballot.
6. The name and mailing address of the incorporator is:
L. M. Custis
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
I, THE UNDERSIGNED, being the incorporator hereinbefore named, for
the purpose of forming a corporation pursuant to the General Corporation Law
of Delaware, do make this certificate, hereby declaring and certifying that
this is my act and deed and the facts herein stated are true, and accordingly
have hereunto set my hand this 27th day of June, 1986.
L. M. Custis
--------------------
L. M. Custis
RECEIVED FOR RECORD
JUL 01 1986
LEO J. DUGAN, JR., RECORDER
<PAGE>
Received for Record
July 1st, A. D. 1986.
Leo J. Dugan, Jr., Recorder.
STATE OF DELAWARE :
: SS.:
NEW CASTLE COUNTY :
Recorded in the Recorder's Office at
Wilmington, Vol. Page &c., the
1st day of July, A. D. 1986.
Witness my hand and official seal.
Leo J. Dugan, Jr.
Recorder.
Recorders Office
New Castle Co. Del.
Mercy Justice
<PAGE>
S T A T E M E N T
OF
SOLE INCORPORATOR
OF
Signal Investment & Management Co.
* * * * *
The certificate of incorporation of this corporation having been
filed in the office of the Secretary of State, the undersigned, being the
sole incorporator named in said certificate, does hereby state that the
following actions were taken on this day for the purpose of organizing this
corporation:
1. The following persons were elected as directors to hold office
until the first annual meeting of stockholders or until their respective
successors are elected and qualified:
Roger Thompson
Robert Bosworth
David R. Evans
2. The board of directors was authorized to make and adopt the
by-laws of the corporation and, in its discretion, to issue the shares of the
capital stock of this
<PAGE>
corporation to the full amount or number of shares authorized by the
certificate of incorporation, in such amounts and for such considerations as
from time to time shall be determined by the board of directors and as may be
permitted by law.
Dated, June 27th, 1986.
/s/ L. M. Custis
--------------------
L. M. Custis
<PAGE>
* * * * *
Signal Investment & Management Co.
* * * * *
* * * * *
C O R P O R A T E R E C O R D S
* * * * *
* * * * *
<PAGE>
CERTIFICATE OF INCORPORATION
OF
Signal Investment & Management Co.
* * * * *
1. The name of the corporation is:
Signal Investment & Management Co.
2. The address of its registered office in the State of Delaware
is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
3. The nature of the business or purposes to be conducted or
promoted is to engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of Delaware.
<PAGE>
4. The total number of shares of stock which the corporation shall
have authority to issue is five hundred (500); all of such shares shall be
without par value.
5. The board of directors is authorized to make, alter or repeal
the by-laws of the corporation. Election of directors need not be by written
ballot.
6. The name and mailing address of the incorporator is:
L. M. Custis
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
I, THE UNDERSIGNED, being the incorporator hereinbefore named, for
the purpose of forming a corporation pursuant to the General Corporation Law
of Delaware, do make this certificate, hereby declaring and certifying that
this is my act and deed and the facts herein stated are true, and
<PAGE>
accordingly have hereunto set my hand this 27th day of June, 1986.
L. M. Custis
------------------
L. M. Custis
<PAGE>
EXHIBIT 3.2
AMENDED AND RESTATED
BYLAWS
OF
SIGNAL INVESTMENT & MANAGEMENT CO.
(a Delaware corporation)
ARTICLE I
STOCKHOLDERS
1. CERTIFICATES REPRESENTING STOCK. Certificates representing
stock in the corporation shall be signed by, or in the name of, the
corporation by the Chairman or Vice-Chairman of the Board of Directors, if
any, or by the President or a Vice-President and by the Treasurer or an
Assistant Treasurer or the Secretary or an Assistant Secretary of the
corporation. Any and all the signatures on any such certificate may be a
facsimile. In case any officer, transfer agent, or registry 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 were such officer, transfer agent, or registrar at the date
of issue.
Whenever the corporation shall be authorized to issue more
than one class of stock or more than one series of any class of stock, and
whenever the corporation shall issue any shares of its stock as partly paid
stock, the certificates representing shares of any such class or series or of
any such partly paid stock shall set forth thereon the statements prescribed
by the General Corporation Law. Any restrictions on the transfer or
registration of transfer of any shares of stock of any class or series shall
be noted conspicuously on the certificate representing such shares.
The corporation may issue a new certificate of stock or
uncertificated shares in place of any certificate theretofore issued by it,
alleged to have been lost, stolen, or destroyed, and the Board of Directors
may require the owner of the lost, stolen, or destroyed certificate, or his
legal representative, to give the corporation a bond sufficient to indemnify
the corporation against any claim that may be made against it on account of
the alleged loss, theft, or destruction of any such certificate or the
issuance of any such new certificate or uncertificated shares.
<PAGE>
2. UNCERTIFICATED SHARES. Subject to any conditions imposed by the
General Corporation Law, the Board of Directors of the corporation may
provide by resolution or resolutions that some or all of any or all classes
or series of the stock of the corporation shall be uncertificated shares.
Within a reasonable time after the issuance or transfer of any uncertificated
shares, the corporation shall send to the registered owner thereof the
written notice prescribed by the General Corporation Law.
3. FRACTIONAL SHARE INTERESTS. The corporation may, but shall not
be required to, issue fractions of a share. If the corporation does not issue
fractions of a share, it shall (1) arrange for the disposition of fractional
interests by those entitled thereto, (2) pay in cash the fair value of
fractions of a share as of the time when those entitled to receive such
fractions are determined, or (3) issue scrip or warrants in registered form
(either represented by a certificate or uncertificated) or bearer form
(represented by a certificate) which shall entitle the holder to receive a
full share upon the surrender of such scrip or warrants aggregating a full
share. A certificate for a fractional share or an uncertificated fractional
share shall, but scrip or warrants shall not unless otherwise provided
therein, entitle the holder to exercise voting rights, to receive dividends
thereon, and to participate in any of the assets of the corporation in the
event of liquidation. The Board of Directors may cause scrip or warrants to
be issued subject to the conditions that they shall become void if not
exchanged for certificates representing the full shares or uncertificated
full shares before a specified date, or subject to the conditions that the
shares for which scrip or warrants are exchangeable may be sold by the
corporation and the proceeds thereof distributed to the holders of scrip or
warrants, or subject to any other conditions which the Board of Directors may
impose.
4. STOCK TRANSFERS. Upon compliance with provisions restricting
the transfer or registration of transfer of shares of stock, if any,
transfers or registration of transfers of shares of stock of the corporation
shall be made only on the stock ledger of the corporation by the registered
holder thereof, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary of the corporation or with a
transfer agent or a registry, if any, and, in the case of shares represented
by certificates, on surrender of the certificate or certificates for such
shares of stock properly endorsed and the payment of all taxes due thereon.
5. RECORD DATE FOR STOCKHOLDERS. For the purpose of determining
the stockholders entitled to notice of or to
<PAGE>
vote at any meeting of stockholders or any adjournment thereof, or to express
consent to corporate action in writing without a meeting, or entitled to
receive payment of any dividend or other distribution or the allotment of any
rights, or entitled to exercise any rights in respect of any change,
conversion, or exchange of stock or for the purpose of any other lawful
action, the directors may fix, in advance, a record date, which shall not be
more than sixty days nor less than ten days before the date of such meeting,
nor more than sixty days prior to any other action. If no record date is
fixed, the record date for determining stockholders entitled to notice of or
to vote at a meeting of stockholders shall be at the close of business on the
day next preceding the day on which notice is given, or, if notice is waived,
at the close of business on the day next preceding the day on which the
meeting is held; the record date for determining stockholders entitled to
express consent to corporate action in writing without a meeting, when no
prior action by the Board of Directors is necessary, shall be the day on
which the first written consent is expressed; and the record date for
determining stockholders for any other purpose shall be at the close of
business on the day on which the Board of Directors adopts the resolution
relating thereto. A determination of stockholders of record entitled to
notice of or to vote at any meeting of stockholders shall apply to any
adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.
6. MEANING OF CERTAIN TERMS. As used herein in respect of the
right to notice of a meeting of stockholders or a waiver thereof or to
participate or vote thereat or to consent or dissent in writing in lieu of a
meeting, as the case may be, the term "share" or "shares" or "share of stock"
or "shares of stock" or "stockholder" or "stockholders" refers to an
outstanding share or shares of stock and to a holder or holders of record of
outstanding shares of stock when the corporation is authorized to issue only
one class of shares of stock, and said reference is also intended to include
any outstanding share or shares of stock and any holder or holders of record
of outstanding shares of stock of any class upon which or upon whom the
certificate of incorporation confers such rights where there are two or more
classes or series of shares of stock or upon which or upon whom the General
Corporation Law confers such rights notwithstanding that the certificate of
incorporation may provide for more than one class or series of shares of stock,
one or more of which are limited or denied such rights thereunder; provided,
however, that no such right shall vest in the event of an increase or a
decrease in the authorized number of shares of stock of any class or series
which is otherwise denied voting rights under the provisions of the
certificate of incorporation, except as any provision of law may otherwise
require.
<PAGE>
7. STOCKHOLDER MEETINGS.
- TIME. The annual meeting shall be held on the date and at the
time fixed, from time to time, by the directors, provided, that the first
annual meeting shall be held on a date within thirteen months after the
organization of the corporation, and each successive annual meeting shall be
held on a date within thirteen months after the date of the preceding annual
meeting. A special meeting shall be held on the date and at the time fixed by
the directors.
- PLACE. Annual meetings and special meetings shall be held at
such place, within or without the State of Delaware, as the directors may,
from time to time, fix. Whenever the directors shall fail to fix such place,
the meeting shall be held at the registered office of the corporation in the
State of Delaware.
- CALL. Annual meetings and special meetings may be called by the
directors or by any officer instructed by the directors to call the meeting.
- NOTICE OR WAIVER OF NOTICE. Written notice of all meetings
shall be given, stating the place, date, and hour of the meeting and stating
the place within the city or other municipality or community at which the
list of stockholders of the corporation may be examined. The notice of an
annual meeting shall state that the meeting is called for the election of
directors and for the transaction of other business which may properly come
before the meeting, and shall (if any other action which could be taken at a
special meeting is to be taken at such annual meeting) state the purpose or
purposes. The notice of a special meeting shall in all instances state the
purpose or purposes for which the meeting is called. The notice of any
meeting shall also include, or be accompanied by, any additional statements,
information, or documents prescribed by the General Corporation Law. Except
as otherwise provided by the General Corporation Law, a copy of the notice of
any meeting shall be given, personally or by mail, not less than ten days nor
more than sixty days before the date of the meeting, unless the lapse of the
prescribed period of time shall have been waived, and directed to each
stockholder at his record address or at such other address which he may have
furnished by request in writing to the Secretary of the corporation. Notice
by mail shall be deemed to be given when deposited, with postage thereon
prepaid, in the United States Mail. If a meeting is adjourned to another
time, not more than thirty days hence, and/or to another place, and if an
announcement of the adjourned time and/or place is made at the meeting, it
shall not be necessary to give notice of the adjourned meeting unless the
directors, after adjournment, fix a new record date for the adjourned
meeting. Notice need not be given to any stockholder who submits a written
waiver of notice signed by him before or after the time stated therein.
Attendance of a stockholder at a meeting of stockholders shall
<PAGE>
constitute a waiver of notice of such meeting, except when the stockholder
attends the meeting 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. Neither the business to be transacted at, nor
the purpose of, any regular or special meeting of the stockholders need be
specified in any written waiver of notice.
- STOCKHOLDER LIST. The officer who has charge of the stock
ledger of the corporation shall prepare and make, at least ten days before
every meeting of stockholder, a complete list of the stockholders, arranged
in alphabetical order, and showing the address of each stockholder and the
number of shares registered in the name of each stockholder. Such list shall
be open to the examination of any stockholder, for any purpose germane to the
meeting, during ordinary business hours, for a period of at least ten days
prior to the meeting, either at a place within the city or other municipality
or community where the meeting is to be held, which place shall be specified
in the notice of the meeting, or if not so specified, at the place where the
meeting is to be held. The list shall also be produced and kept at the time
and place of the meeting during the whole time thereof, and may be inspected
by any stockholder who is present. The stock ledger shall be the only
evidence as to who are the stockholders entitled to examine the stock ledger,
the list required by this section or the books of the corporation, or to vote
at any meeting of stockholders.
- CONDUCT OF MEETING. Meetings of the stockholders shall be
presided over by one of the following officers in the order of seniority and
if present and acting--the Chairman of the Board, if any, the Vice-Chairman
of the Board, if any, the President, a Vice-President, or, if none of the
foregoing is in office and present and acting, by a chairman to be chosen by
the stockholders. The Secretary of the corporation, or in his absence, an
Assistant Secretary, shall act as secretary of every meeting, but if neither
the Secretary nor an Assistant Secretary is present the Chairman of the
meeting shall appoint a secretary of the meeting.
- PROXY REPRESENTATION. Every stockholder may authorize another
person or persons to act for him by proxy in all matters in which a
stockholder is entitled to participate, whether by waiving notice of any
meeting, voting or participating at a meeting, or expressing consent or
dissent without a meeting. Every proxy must be signed by the stockholder or
by his attorney-in-fact. No proxy shall be voted or acted upon after three
years from its date unless such proxy provides for a longer period. A duly
executed proxy shall be irrevocable if it states that it is irrevocable and,
if, and only as long as, it is coupled with an interest sufficient in law to
support an irrevocable power. A proxy may be made irrevocable regardless of
whether the interest with which it is coupled is an interest in the stock
itself or an interest in the corporation generally.
<PAGE>
- INSPECTORS. The directors, in advance of any meeting, may, but
need not, appoint one or more inspectors of election to act at the meeting or
any adjournment thereof. If an inspector or inspectors are not appointed, the
person presiding at the meeting may, but need not, appoint one or more
inspectors. In case any person who may be appointed as an inspector fails to
appear or act, the vacancy may be filled by appointment made by the directors
in advance of the meeting or at the meeting by the person presiding thereat.
Each inspector, if any, before entering upon the discharge of his duties,
shall take and sign an oath faithfully to execute the duties of inspector at
such meeting with strict impartiality and accord to the best of his ability.
The inspectors, if any, shall determine the number of shares of stock
outstanding and the voting power of each, the shares of stock represented at
the meeting, the existence of a quorum, the validity and effect of proxies,
and shall receive votes, ballots or consents, hear and determine all
challenges and questions arising in connection with the right to vote, count
and tabulate all votes, ballots or consents, determine the result, and do
such acts as are proper to conduct the election or vote with fairness to all
stockholders. On request of the person presiding at the meeting, the
inspector or inspectors, if any, shall make a report in writing of any
challenge, question or matter determined by him or them and execute a
certificate of any fact found by him or them.
- QUORUM. The holders of a majority of the outstanding shares of
stock shall constitute a quorum at a meeting of stockholders for the
transaction of any business. The stockholders present may adjourn the meeting
despite the absence of a quorum.
- VOTING. Each share of stock shall entitle the holder thereof to
one vote. In the election of directors, a plurality of the votes cast shall
elect. Any other action shall be authorized by a majority of the votes cast
except where the General Corporation Law prescribes a different percentage of
votes and/or a different exercise of voting power, and except as may be
otherwise prescribed by the provisions of the certificate of incorporation
and these bylaws. In the election of directors, and for any other action,
voting need not be by ballot.
8. STOCKHOLDER ACTION WITHOUT MEETINGS. Any action required by the
General Corporation Law 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. Prompt notice of the taking of the corporate action
without a meeting by less
<PAGE>
than unanimous written consent shall be given to those stockholders who have
not consented in writing.
ARTICLE II
DIRECTORS
1. FUNCTIONS AND DEFINITION. The business and affairs of the
corporation shall be managed by or under the direction of the Board of
Directors of the corporation. The Board of Directors shall have the authority
to fix the compensation of members thereof. The use of the phrase "whole
board" herein refers to the total number of directors which the corporation
would have if there were no vacancies.
2. QUALIFICATIONS AND NUMBER. A director need not be a
stockholder, a citizen of the United States, or a resident of the State of
Delaware. The Board of Directors shall consist of at least three persons and
no more than seven persons. Subject to the foregoing limitation, such number
may be fixed from time to time by action of the stockholders or of the
directors, or, if the number is not fixed, the number shall be five. The
number of directors may be increased or decreased by action of the
stockholders or of the directors.
3. ELECTION AND TERM. The first Board of Directors, unless the
members thereof shall have been named in the certificate of incorporation,
shall be elected by the incorporator or incorporators and shall hold office
until the first annual meeting of stockholders and until their successors are
elected and qualified or until their earlier resignation or removal. Any
director may resign at any time upon written notice to the corporation.
Thereafter, directors who are elected at an annual meeting of stockholders,
and directors who are elected in the interim to fill vacancies and newly
created directorships, shall hold office until the next annual meeting of
stockholders and until their successors are elected and qualified or until
their earlier resignation or removal. In the interim between annual meetings
of stockholders or of special meetings of stockholders called for the
election of directors and/or for the removal of one or more directors and for
the filling of any vacancy in that connection, newly created directorships
and any vacancies in the Board of Directors, including unfilled vacancies
resulting from the removal of directors for cause or without cause, may be
filled by the vote of a majority of the remaining directors then in office,
although less than a quorum, or by the sole remaining director.
4. MEETINGS.
- TIME. Meetings shall be held at such time as the Board shall
fix, except that the first meeting of a newly elected Board shall be held as
soon after its election as the directors may conveniently assemble.
<PAGE>
- PLACE. Meetings shall be held at such place within or without
the State of Delaware as shall be fixed by the Board.
- CALL. No call shall be required for regular meetings for which
the time and place have been fixed. Special meetings may be called by or at
the direction of the Chairman of the Board, if any, the Vice-Chairman of the
Board, if any, of the President, or of a majority of the directors in office.
- NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be
required for regular meetings for which the time and place have been fixed.
Written, oral, or any other mode of notice of the time and place shall be
given for special meetings in sufficient time for the convenient assembly of
the directors thereat. Notice need not be given to any director or to any
member of a committee of directors who submits a written waiver of notice
signed by him before or after the time stated therein. Attendance of any such
person at a meeting shall constitute a waiver of notice of such meeting,
except when he attends a meeting 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. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the
directors need be specified in any written waiver of notice.
- QUORUM AND ACTION. Two or more members of the Board shall
constitute a quorum provided that proper notice has been given or other
directors file a waiver of notice. A majority of the directors present,
whether or not a quorum is present, may adjourn a meeting to another time and
place. Except as herein otherwise provided, and except as otherwise provided
by the General Corporation Law, the vote of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the
Board. The quorum and voting provisions herein stated shall not be construed
as conflicting with any provisions of the General Corporation Law and these
Bylaws which govern a meeting of directors held to fill vacancies and newly
created directorships in the Board or action of disinterested directors.
Any member or members of the Board of Directors or of any committee
designated by the Board, may participate in a meeting of the Board, or any
such committee, as the case may be, by means of conference telephone or
similar communications equipment by means of which all persons participating
in the meeting can hear each other.
- CHAIRMAN OF THE MEETING. The Chairman of the Board, if any and
if present and acting, shall preside at all meetings. Otherwise, the
Vice-Chairman of the Board, if any and if present and acting, or the
President, if present and acting, or any other director chosen by the Board,
shall preside.
<PAGE>
5. REMOVAL OF DIRECTORS. Except as may otherwise be provided by
the General Corporation Law, any director or the entire Board of Directors
may be removed, with or without cause, by the holders of a majority of the
shares then entitled to vote at an election of directors.
6. COMMITTEES. The Board of Directors may, by resolution passed by
a majority of the whole Board, designate one or more committees, each
committee to consist of one or more of the directors of the corporation. The
Board may designate one or more directors as alternate members of any
committee, who may replace any absent or disqualified member at any meeting
of the committee. In the absence or disqualification of any member of any
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they
constitute a quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in the place of any such absent or
disqualified member. Any such committee, to the extent provided in the
resolution of the Board, shall have and may exercise the powers and authority
of the Board of Directors in the management of the business and affairs of
the corporation with the exception of any authority the delegation of which
is prohibited by Section 141 of the General Corporation Law, and may
authorize the seal of the corporation to be affixed to all papers which may
require it.
7. WRITTEN ACTION. Any action required or permitted to be taken at
any meeting of the Board of Directors or any committee thereof may be taken
without a meeting if all members of the Board or committee, as the case may
be, consent thereto in writing, and the writing or writings are filed with
the minutes of proceedings of the Board or committee.
ARTICLE III
OFFICERS
The officers of the corporation shall consist of a President, a
Secretary, a Treasurer, and, if deemed necessary, expedient, or desirable by
the Board of Directors, a Chairman of the Board, a Vice-Chairman of the
Board, an Executive Vice-President, one or more other Vice-Presidents, one or
more Assistant Secretaries, one or more Assistant Treasurer, and such other
officers with such titles as the resolution of the Board of Directors
choosing them shall designate. Except as may otherwise be provided in the
resolution of the Board of Directors choosing him, no officer other than the
Chairman or Vice-Chairman of the Board, if any, need be a director. Any
number of offices may be held by the same person, as the directors may
determine.
Unless otherwise provided in the resolution choosing him, each
officer shall be chosen for a term which shall continue until the meeting of
the Board of Directors following the next
<PAGE>
annual meeting of stockholders and until his successor shall have been chosen
and qualified.
All officers of the corporation shall have such authority and
perform such duties in the management and operation of the corporation as
shall be prescribed in the resolutions of the Board of Directors designating
and choosing such officers and prescribing their authority and duties, and
shall have such additional authority and duties as are incident to their
office except to the extent that such resolutions may be inconsistent
therewith. The Secretary or an Assistant Secretary of the corporation shall
record all of the proceedings of all meetings and actions in writing of
stockholders, directors, and committees of directors, and shall exercise such
additional authority and perform such additional duties as the Board shall
assign to him. Any officer may be removed, with or without cause, by the
Board of Directors. Any vacancy in any office may be filled by the Board of
Directors.
<PAGE>
ARTICLE IV
OFFICERS AND DIRECTORS
INDEMNIFICATION
The corporation shall indemnify its officers and directors and
provide for the advancement of litigation expenses to them to the fullest
extent permitted by Section 145 of the General Corporation Law, as the same
may from time to time be amended, and any successor statute thereto.
ARTICLE V
The corporation seal shall be in such form as the Board of
Directors shall prescribe.
ARTICLE VI
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall be
subject to change, by the Board of Directors.
ARTICLE VII
CONTROL OVER BYLAWS
Subject to the provisions of the certificate of incorporation and
the provisions of the General Corporation Law, the power to amend, alter or
repeal these Bylaws and to adopt new Bylaws may be exercised by the Board of
Directors or by the stockholders.
I HEREBY CERTIFY that the foregoing is a full, true and correct
copy of the Bylaws of Signal Investment & Management Co., a Delaware
corporation, as in effect on the date hereof.
WITNESS my hand and seal of the corporation.
Dated: March 20, 1991
/s/ CHARLES N. JOLLY
-----------------------------------
CHARLES N. JOLLY, Secretary
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
Signal Investment & Management Co.'s audited financial statements and
is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> NOV-30-1996
<PERIOD-START> DEC-01-1995
<PERIOD-END> NOV-30-1996
<CASH> 2,911
<SECURITIES> 0
<RECEIVABLES> 1,287
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 4,198
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 78,284
<CURRENT-LIABILITIES> 0
<BONDS> 75,713
0
0
<COMMON> 2
<OTHER-SE> 1,013
<TOTAL-LIABILITY-AND-EQUITY> 78,284
<SALES> 0
<TOTAL-REVENUES> 6,411
<CGS> 0
<TOTAL-COSTS> 1,797
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 4,614
<INCOME-TAX> 1,575
<INCOME-CONTINUING> 3,039
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,039
<EPS-PRIMARY> 12.16
<EPS-DILUTED> 12.16
</TABLE>
