<PAGE> 1
As filed with the Securities and Exchange Commission on June 5, 1995
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_________________
STANDARD BRANDS PAINT COMPANY
(Exact name of registrant as specified in its charter)
_________________
Delaware 4300 West 190th Street 95-6029682
(State or other jurisdiction of Torrance, California 90509 (I.R.S. Employer
incorporation or organization) (310) 214-2411 Identification
Number)
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
__________________
HOWARD S. SCHWARTZ
STANDARD BRANDS PAINT COMPANY
4300 West 190th Street
Torrance, California 90509
(310) 214-2411
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
_______________________
Copy to:
FRANK H. GOLAY, JR.
Sullivan & Cromwell
444 South Flower Street
Los Angeles, California 90071
(213) 955-8000
_______________________
Approximate date of commencement of proposed sale to the
public: From time to time after the effective date of this Registration
Statement, as determined by market conditions.
If the only securities being registered on this form are being
offered pursuant to dividend or interest reinvestment plans, please check
the following box. [ ]
If any of the securities being registered on this form are to
be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection
with dividend or reinvestment plans, please check the following box. [x]
_______________________
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed maximum Amount of
Title of each class of Amount to Proposed maximum aggregate offering registration
securities to be registered be registered aggregate price per unit(1) price(1) fee
<S> <C> <C> <C> <C>
Common Stock 3,392,008 shares $3.375 per share $11,448,027 $ 3,948
8% Series A Cumulative Convertible
Mandatory Redeemable Preferred Stock 1,570,049 shares $27.12 per share(2) $42,582,084 } $14,684
Common Stock(3) 12,616,970 shares N/A N/A } ________
Total registration fee $18,632
<FN>
(1) Estimated solely for the purpose of calculating the
registration fee.
(2) Based on the higher of (a) $8.92 per share (the liquidation
preference of such Preferred Stock) and (b) the Common Stock
price multiplied by approximately 8.036 (the number of shares
of Common Stock into which each share of Series A Preferred
Stock is convertible).
(3) Issuable upon conversion of the Series A Preferred Stock.
Holders of such Preferred Stock may either (a) sell such stock
directly (which will include an offer of the underlying Common
Stock), (b) convert the Preferred Stock and then sell the
Common Stock received on conversion or (c) effect some
combination thereof. In any such case, no separate filing fee
is payable with respect to such Common Stock, the same filing
fee covering both the Series A Preferred Stock and such Common
Stock.
_______________
</FN>
</TABLE>
<PAGE>
<PAGE> 2
The registrant hereby amends this registration statement on
such date or dates as may be necessary to delay its effective date or until
the registrant shall file a further amendment which specifically states
that this registration statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until this
registration statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.
<PAGE>
<PAGE> 1
PROSPECTUS
Standard Brands Paint Company
Common Stock
Series A Preferred Stock
_______________
This Prospectus relates to 3,392,008 shares of Common Stock and
1,570,049 shares of Series A Preferred Stock (and 12,616,970 shares of
Common Stock issuable upon conversion of the Series A Preferred Stock)
offered by the Selling Stockholders named herein (the "Selling
Stockholders"). See "Selling Stockholders." Standard Brands Paint
Company (the "Company") will not receive any of the proceeds from the
sale of the Common Stock or Series A Preferred Stock offered hereby.
The Common Stock and the Series A Preferred Stock are referred to herein
as the "Offered Securities."
The Series A Preferred Stock is entitled to cumulative cash dividends
at the annual rate of $0.71 per share, payable quarterly, commencing in
January 1997. The Series A Preferred Stock is convertible into the
Company's Common Stock at a conversion price of $1.11 per share of Common
Stock, the Series A Preferred Stock being credited at $8.92 per share for
this purpose, commencing in January 1997, or commencing earlier if a market
price condition relating to the Common Stock is met. The Series A
Preferred Stock is redeemable mandatorily in May 2005, and 785,025 shares
of the Series A Preferred Stock are subject to prior optional purchase or
redemption by the Company or Corimon, S.A.C.A. The applicable redemption
prices are stated elsewhere herein.
The sale or distribution of the Offered Securities may be effected
directly to purchasers by the Selling Stockholders as principals or through
one or more underwriters, brokers, dealers or agents from time to time in
one or more transactions. See "Plan of Distribution."
The number of shares of Offered Securities and the offering price of
the shares of Offered Securities in respect of which this Prospectus is
being delivered ("Offered Shares") are set forth in the accompanying
Prospectus Supplement ("Prospectus Supplement"). The Prospectus Supplement
also sets forth the names of any agents, dealers or underwriters acting in
connection with the sale of the Offered Shares, the compensation of such
agents, dealers and underwriters and the other terms of offering of the
Offered Shares. The Company estimates that the expenses of the offering to
be borne by it will be approximately $125,000.
The Company's Common Stock is listed on the New York Stock Exchange
under the symbol "SBP." On May 31, 1995, the last reported sale price for
the Common Stock on the New York Stock Exchange Composite Tape was $3.50
per share. The Company's Series A Preferred Stock is not listed on any
securities exchange.
THE OFFERED SECURITIES INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
BEGINNING ON PAGE 3.
_______________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMIS-
SION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
_______________
The date of this Prospectus is June 5, 1995
<PAGE>
<PAGE> 2
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). This
Prospectus does not contain all of the information set forth in the
Registration Statement on Form S-3 and exhibits thereto which the Company
has filed with the Commission under the Securities Act of 1933, as amended
(the "Securities Act"). Such reports, proxy statements and other informa-
tion concerning the Company and the Registration Statement can be inspected
and copied at the public reference facilities of the Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C., and at the following
regional offices of the Commission: 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and 7 World Trade Center, Suite 1300, New
York, New York 10048. Copies of such material can also be obtained at
prescribed rates from the Public Reference Section of the Commission,
450 Fifth Street, N.W., Washington, D.C. 20549. In addition, reports,
proxy statements and other information concerning the Company may be
inspected at the offices of the New York Stock Exchange, Room 401, 20 Broad
Street, New York, New York 10005.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
1. The Company's Annual Report on Form 10-K for the
fiscal year ended January 29, 1995 (the "Form 10-K").
2. The Company's Proxy Statement, April 25, 1995, relating to
the special meeting of stockholders held on May 16, 1995 at which the
stockholders approved a financial restructuring of the Company (the
"April Proxy Statement").
3. The Company's Current Report on Form 8-K dated May 16,
1995, as amended by Form 8-K/A dated May 23, 1995.
4. The Company's Proxy Statement, filed May 31, 1995, to be
dated on or about July 3, 1995, relating to the annual meeting of
stockholders to be held in August 1995.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Prospectus and prior
to the termination of the offering made hereby shall be deemed to be
incorporated by reference in this Prospectus.
Any statement in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for
purposes of this Prospectus to the extent that a statement contained herein
or in any subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as
so modified or superseded, to constitute a part of this prospectus.
The Company will provide without charge to each person to whom a
Prospectus is delivered, on the written or oral request of any such person,
a copy of any or all of the documents incorporated by reference herein
other than exhibits to such documents. Such requests should be addressed
to: Investor Relations Department, Standard Brands Paint Company,
4300 West 190th Street, Torrance, California 90509; (310) 214-2411.
<PAGE>
<PAGE> 3
No person has been authorized to give any information or to make any
representation not contained in this Prospectus or the Prospectus
Supplement in connection with the offering made hereby, and if given or
made, such information or representation must not be relied upon as having
been authorized by the Company or any dealer. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any of the
securities offered hereby in any jurisdiction to any person to whom it is
unlawful to make such offer or solicitation in such jurisdiction. Neither
the delivery of this Prospectus nor any sale hereunder shall under any
circumstances create any implication that there has been no change in the
affairs of the Company since the date hereof.
THE COMPANY
The Company, a Delaware corporation whose predecessor was founded in
1939, is an integrated supplier of paint and related products. As of
January 29, 1995, the end of the 1994 fiscal year, the Company operated 58
retail stores in eight western states. The Company's wholly-owned
subsidiary, Major Paint Company, manufactures high quality paint and
related products. Such paint and products are distributed primarily
through the Company's retail stores. The Company's principal executive
offices are located at 4300 West 190th Street, Torrance, California 90509;
(310) 214-2411.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Offered Securities.
RISK FACTORS
In addition to the other information in this Prospectus, the
following risk factors should be considered carefully in evaluating whether
to make an investment in the Offered Securities.
No Assurances as to Success in Restructuring
On May 16, 1995, the Company underwent a financial restructuring (the
"Restructuring") designed to provide new capital for the Company and
substantially reduce its outstanding indebtedness. However, additional
lease payments in part offset reductions in interest payments. Following
the Restructuring, the Company is under new management appointed by Corimon
Corporation, a wholly-owned subsidiary of Corimon, S.A.C.A. (collectively,
"CRM"). The Company will not, however, be consolidated or merged with CRM,
but will remain a separate company. CRM intends to propose from time to
time, and management intends to implement, various strategic changes to the
operations of the Company. Such changes will include increasing inventory
levels in the stores, refocusing sale strategies and increasing advertising
and other marketing efforts. Any such operational changes will be proposed
by CRM and implemented by the Company with the intention of returning the
Company to profitability. However, there can be no assurances that the
Company will be successful in the Restructuring or in effecting any such
operational changes or that it will be able to improve its sales or reduce
its operating expenses in order to return to profitability.
Previously, the Company has not been successful in its prior
restructuring efforts. The three principal restructuring efforts were
(i) the recapitalization in 1987, (ii) the bankruptcy in 1993 and (iii) the
establishment of a liquidating property trust in 1994. The Restructuring
was different from these three prior restructuring efforts in that it
involved a substantial equity investment by CRM, a multinational retailer
and producer of paint and related products.
<PAGE>
<PAGE> 4
Operating Losses and Declining Sales
The Company has incurred significant losses for each of the fiscal
years ended January 31, 1993, January 30, 1994 and January 29, 1995.
During these periods, sales have declined from $226.7 million for the
fiscal year ended January 31, 1993 to $112.2 million for the fiscal year
ended January 29, 1995. For the fiscal year ended January 29, 1995, the
Company reported consolidated losses of $48.0 million. The improved
performance of the Company will depend upon its ability to (i) increase
sales at core stores and outside sales, (ii) reduce debt levels, and
(iii) improve cash flow. There is no assurance that the Company will be
able to accomplish these objectives significantly enough to curtail its
continuing sales decline and net losses. Failure to effect substantial
positive changes in the operations of the Company could have a material
adverse effect on the Company and its stockholders.
Substantial Leverage
Even after giving effect to the reduction in outstanding debt
pursuant to the Restructuring, the Company has a substantial amount of
debt. On a consolidated basis as of May 31, 1995, the Company has
outstanding senior secured debt of approximately $16.0 million principal
amount owing to Transamerica Occidental Life Insurance Company ("TOLIC"),
Transamerica Life Insurance and Annuity Company ("TLIAC"), Sun Life
Insurance Company of America ("SAFI") and Anchor National Life Insurance
Company ("ANLIC" and, together with TOLIC, TLIAC and SAFI, the "Insurance
Company Lenders"), approximately $5.5 million under a working capital
facility with Foothill Capital Corp. ("Foothill") and approximately
$5.0 million under a working capital facility with Fidelity Capital &
Income Fund ("FCI"). The Company's high degree of leverage may pose
substantial risks to holders of its Common Stock and Series A Preferred
Stock and may have materially adverse effects on the marketability, price
and future value of the Common Stock and Series A Preferred Stock. Among
other consequences, the high degree of leverage of the Company may result
in impairment of its ability to obtain additional financing in the future,
to make acquisitions, or to take advantage of significant business
opportunities that may arise. In addition, this high degree of leverage
may increase the vulnerability of the Company to adverse general economic
and retailing industry conditions and to increased competitive pressures,
including price pressures from less highly leveraged competitors. The
Company believes, although there can be no assurance, that after giving
effect to the operational restructuring that is being made in conjunction
with the Restructuring, the Company's cash flow from operations,
borrowings, and asset sales will be adequate to make required payments of
principal and interest on its debt, to permit anticipated capital
expenditures, and to fund working capital requirements. However, if the
Company is unable to generate sufficient cash flow from operations,
borrowings, and asset sales in the future, it could default on its
outstanding debt obligations.
Management expects that the Company will need additional capital
during the third or fourth quarter to sustain its operations through the
end of the 1995 fiscal year. CRM has confirmed to the Company that it will
make funds available to the Company, as necessary, to meet its operating
requirements and discharge its obligations through the end of the 1995
fiscal year.
Debt Service Requirements
Although the Company expects to meet the interest and principal
payment requirements on its secured debt and pay its other indebtedness,
there can be no assurance that actual operating results will in fact
generate sufficient cash to pay such obligations. If they do not, cash
will have to be generated from alternative sources such as asset sales,
additional financings or refinancings, or reductions in operating
expenditures. Unfavorable conditions in the Southern California economy
and the retailing industry, the high degree of leverage of the Company,
restrictive covenants contained in the Company's senior secured debt and
working capital facilities, liens granted on assets, and various other
factors may limit the ability of the Company to successfully undertake any
such actions. No assurance can be given as to the availability of
alternative sources of funds if such funds are needed by the Company. Any
utilization of alterative sources of funds may impair the competitive
position
<PAGE>
<PAGE> 5
of the Company, reduce its cash flow, or have other adverse consequences,
including imposition of burdensome covenants, security interests, or other
obligations, thereby possibly increasing the risk of defaults under
applicable debt instruments or causing other foreseeable consequences that
could be adverse to the Company and holders of its Common Stock and
Series A Preferred Stock. There can be no assurance as to when, or to what
extent, the business environment will improve. As a result, the Company
may continue to experience difficulty in improving its operating and
financial results for an indefinite period.
The Competitive Retail Industry
The retail industry generally, and the home improvement industry in
particular, is intensively competitive. The Company not only competes with
home improvement stores in the geographic areas in which it operates, but
also with home centers and warehouse-type distributors of home improvement
and related products that emphasize wide selection and everyday low prices.
Some of the retailers with which the Company competes have substantially
greater financing resources than the Company and may have greater
competitive advantages over the Company. The Company believes that it can
compete successfully with these and other distributors of home improvement
and related products in terms of price, quality, service and selection, by
concentrating on inner city markets largely ignored by the warehouse-type
stores or where barriers to entry may exist, and by implementing a
marketing strategy that characterizes the Company's retail units as the low
price "neighborhood store" offering a wide selection of paint and home
improvement products and first class service.
Economic Recession
The economy in the Company's primary geographical markets in Southern
California continues to experience an economic recession. As a result, the
Company's sales are very sensitive to fluctuations in the level of economic
activity in California. The California economy has remained in a recession
longer than many other portions of the United States. The current
recession has had an adverse effect on the Company's revenues and operating
results and there can be no assurance that it will not continue to do so.
Fluctuation of the Public Market for the Company's Common Stock and
Series A Preferred Stock
The market for the Company's Common Stock may be affected by the fact
that, as of May 16, 1995, approximately 77.4% of the Company's issued and
outstanding Common Stock was held by CRM, approximately 9.6% was held by
FCI, approximately 1.8% was held by Kodak Retirement Income Plan Trust Fund
("KRI"), approximately 2.2% was held by Libra Investments, Inc. ("Libra")
and approximately 4.2% was held by the Insurance Company Lenders. Thus, as
of that date, only approximately 5% (or 3% on a fully diluted basis) of the
total outstanding shares of Common Stock was held by other stockholders.
Prior to effectiveness of the Registration Statement of which this
Prospectus is a part, only a limited amount of Common Stock was available
for public trading. These factors will affect the liquidity of the market
for the Common Stock. Depending upon how and when the Selling Stockholders
sell their shares, the market for Common Stock may be volatile and indeed
may be depressed for a period of time until the market has had time to
absorb these sales. Other factors, such as the likelihood that the Company
will not declare dividends for the foreseeable future, may further depress
the market for the Common Stock.
There is currently no public market for the Company's Series A
Preferred Stock nor does the Company expect one to develop. The Company's
Series A Preferred Stock is not listed on any securities exchange and all
shares of such stock are held by the Selling Stockholders.
No Dividends
The Company anticipates that no dividends on its Common Stock will be
declared in the foreseeable future. In addition, covenants in the
Company's senior secured debt and working capital facilities currently
prohibit the Company from paying dividends on its Common Stock. Certain
institutional investors may invest
<PAGE>
<PAGE> 6
only in dividend-paying equity securities or may operate under other
restrictions that prohibit or limit their ability to invest in the
Company's Common Stock. These prohibitions or limitations may depress the
market for the Common Stock.
Control by CRM
The consummation of the Restructuring has resulted in a change in
control of the Company. CRM currently owns approximately 77.4% of the
outstanding shares of the Company's Common Stock, and pursuant to a
stockholders' agreement between CRM and the Company, CRM has the power to
designate seven of the ten directors of the Company. CRM has the power to
control the affairs of the Company and to direct all fundamental corporate
transactions.
<PAGE>
<PAGE> 7
PRICE RANGE OF COMMON STOCK
The Common Stock of the Company is listed on the New York Stock
Exchange, Inc. (the "NYSE").
The following table shows the high and low sale prices of the Common
Stock for the periods indicated as reported on the NYSE Composite Tape
during each period. Prices through May 16, 1995 are adjusted to reflect
the 1 for 10 reverse stock split effected by the Company on May 16, 1995 in
connection with the Restructuring.
<TABLE>
<CAPTION>
High Low
<S> <C> <C>
Fiscal Year Ending January 28, 1996
First Quarter . . . . . . . . . . . . . . . . . . . . . . $ 8.75 $ 2.34
Second Quarter (through May 16, 1995) . . . . . . . . . 3.75 1.87
(through May 31, 1995) . . . . . . . . . 8.00 1.00
Fiscal Year Ended January 29, 1995
First Quarter . . . . . . . . . . . . . . . . . . . . . . $ 23.75 $ 17.50
Second Quarter . . . . . . . . . . . . . . . . . . . . 20 13.75
Third Quarter . . . . . . . . . . . . . . . . . . . . . . 16.25 10
Fourth Quarter . . . . . . . . . . . . . . . . . . . . . . 10 2.03
Fiscal Year Ended January 30, 1994
First Quarter . . . . . . . . . . . . . . . . . . . . . . $ 28.75 $ 15
Second Quarter . . . . . . . . . . . . . . . . . . . . 48.75 20
Third Quarter . . . . . . . . . . . . . . . . . . . . . . 36.25 20
Fourth Quarter . . . . . . . . . . . . . . . . . . . . . . 22.50 17.50
</TABLE>
For a recent reported price of the Common Stock on the NYSE, see the
cover page of this Prospectus. As of May 31, 1995, the Company had 2,815
holders of record of Common Stock.
Since 1987, the Company has not declared or paid any cash dividends
on its Common Stock. The Company anticipates that no cash dividends on its
Common Stock will be declared in the foreseeable future, and that all
earnings will be retained for the development of the Company's business.
In addition, covenants in the Company's senior secured debt and working
capital facilities currently prohibit the Company from paying dividends on
its Common Stock. Any future dividends would be conditional upon, among
other things, future earnings and the financial condition of the Company.
<PAGE>
<PAGE> 8
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 100,000,000
shares of Common Stock and 5,000,000 shares of Preferred Stock. As of
May 16, 1995, the Company had outstanding 20,634,936 shares of Common
Stock, 1,570,049 shares of Series A Preferred Stock and 12,616,970 shares
of Common Stock reserved for issuance upon conversion of the Series A
Preferred Stock. The following summary description relating to the capital
stock does not purport to be complete. Reference is made to the Restated
Certificate of Incorporation of the Company, the By-Laws of the Company and
the Certificate of Designations of Series A Preferred Stock of the Company,
which are filed as exhibits to the Registration Statement of which this
Prospectus is a part.
Common Stock
Holders of Common Stock are entitled to receive such dividends as may
from time to time be declared by the Board of Directors of the Company out
of funds legally available therefor. Holders of Common Stock are entitled
to one vote per share on all matters on which stockholders are entitled to
vote and do not have any cumulative voting rights. Holders of Common Stock
have no preemptive, conversion, redemption or sinking fund rights. In the
event of a liquidation, dissolution or winding-up of the Company, holders
of Common Stock are entitled to share equally and ratably in the net assets
of the Company, if any, remaining after the payment preference of any
outstanding Preferred Stock. The outstanding shares of Common Stock are,
and the shares of Common Stock issuable upon conversion of the Series A
Preferred Stock, when such shares are issued, will be, fully paid and
nonassessable. The rights, preferences and privileges of holders of Common
Stock are subject to the Series A Preferred Stock and any other series of
Preferred Stock which the Company may issue in the future.
The registrar and transfer agent for the Common Stock is Continental
Stock Transfer & Trust Company.
Preferred Stock
Pursuant to the Restructuring, the Company issued 1,570,049 shares of
8% Series A Convertible Mandatory Redeemable Preferred Stock (the "Series A
Preferred Stock").
Dividend Rights
The holders of shares of the Series A Preferred Stock shall be
entitled to receive, when and as declared by the Company's Board of
Directors, cumulative cash dividends at the annual rate of $0.71 per share,
payable quarterly on the first days of January, April, July and October.
The initial dividend on the Series A Preferred Stock shall be payable on
the first quarterly dividend payment date after the date ("Commencement
Date") that is 18 months after May 16, 1995 ("Issuance Date"). So long as
any share of Series A Preferred Stock remains outstanding, no dividend
shall be paid or declared and no distribution made on any junior stock
other than a dividend payable in junior stock, and no shares of junior
stock shall be purchased, redeemed or otherwise acquired for consideration
by the Company, directly or indirectly (other than as a result of a
reclassification of junior stock, or the exchange or conversion of one
junior stock for or into another junior stock, or other than through the
use of the proceeds of a substantially contemporaneous sale of other junior
stock), unless all dividends on the Series A Preferred Stock accrued for
all past quarter-yearly dividends since the Commencement Date have been
paid or declared or set aside for payment.
<PAGE>
<PAGE> 9
Liquidation Rights
In the event of any voluntary liquidation, dissolution or winding up
of the affairs of the Company, the holders of shares of Series A Preferred
Stock shall be entitled, before any distribution or payment is made to the
holders of any junior stock, to be paid in full the Redemption Price in
effect at the time of such distribution, together with accrued dividends to
such date whether or not earned or declared. The Redemption Price shall be
$6.69 per share for the period from the Issuance Date to the first
anniversary thereof, $7.14 per share thereafter to the second anniversary
of the Issuance Date, $7.60 per share thereafter for the next six-month
period, $8.03 per share thereafter for the next six-month period, $8.47 per
share thereafter for the next six-month period and $8.92 per share
thereafter.
In the event of an involuntary liquidation, dissolution or winding up
of the affairs of the Company, then, before any distribution or payment to
holders of any junior stock, the holders of Series A Preferred Stock shall
be entitled to be paid in full an amount equal to $8.92 per share, together
with accrued dividends to such date whether or not earned or declared.
Optional Purchase and Redemption Rights
CRM or the Company may purchase or redeem up to 785,025 shares of
Series A Preferred Stock, at any time or from time to time, at the
Redemption Price in effect at the redemption date, together with accrued
dividends to the redemption date. Such dividends shall be deemed to have
been cumulative from the Issuance Date.
Advance notice of every redemption is required at least 30 and not
more than 60 days prior to the redemption date. Any partial redemption
must be effected on a pro rata basis.
Mandatory Redemption
The Company will redeem the whole of the shares of Series A Preferred
Stock at the time outstanding at the tenth anniversary of the Issuance
Date, at a price of $8.92 per share, together with accrued dividends to the
redemption date.
Conversion Rights
The holders of shares of Series A Preferred Stock shall have the
right, at their option, to convert such shares into Company Common Stock at
any time after the Commencement Date, and prior to such date if and only if
the price of the Company's Common Stock trades at a twenty day average
price at or above the Conversion Price (as hereafter defined). The price
at which Common Stock shall be delivered upon conversion (the "Conversion
Price") shall initially be $1.11 per share of Common Stock. Each share of
Series A Preferred Stock shall be valued at $8.92 for the purpose of
conversion. In lieu of issuing any fractional share of Common Stock upon
conversion, the Company shall pay the cash equivalent thereof based on the
then current market price of such shares.
The Conversion Price is subject to adjustment under formulas designed
to protect against dilution of the conversion right, including adjustments
upon stock dividends, subdivisions of Common Stock, combinations of Common
Stock, reclassifications of Common Stock (including reclassification by a
merger or consolidation or otherwise), certain extraordinary distributions
of evidences of indebtedness or assets, and certain rights offerings. In
case shares of the Series A Preferred Stock are called for redemption, the
right to convert such shares will terminate at the close of business on the
redemption date, unless default is made in payment of the redemption price.
In case of any conversion, the Company shall always have the option, in
lieu of delivering shares of its Common Stock upon conversion, of paying to
the converting holder a cash amount equal to the
<PAGE>
<PAGE> 10
current market price per share of the Common Stock, multiplied by the
number of shares of Common Stock that would otherwise be issuable upon such
conversion.
Voting Rights
The holders of Series A Preferred Stock shall be entitled to the
following voting rights. After the Commencement Date, if and whenever six
quarterly dividends payable on any shares of Series A Preferred Stock shall
be in arrears in whole or in part whether or not earned or declared, the
number of directors then constituting the Board of Directors shall be
increased by two and the holders of shares of Series A Preferred Stock,
together with the holders of shares of every other series of Preferred
Stock similarly entitled to vote for the election of two additional
directors, voting separately as a class, shall be entitled to elect the two
additional directors. When all dividends in arrears on the shares of
Series A Preferred Stock then outstanding shall have been paid the right of
the holders of the shares of Series A Preferred Stock to elect such two
additional directors shall cease, and the terms of office of all persons so
elected as directors shall terminate.
The consent of the holders of at least 66-2/3% of the shares of
Series A Preferred Stock shall be necessary to effect or validate, any of
the following: (i) any amendment, alteration or repeal of any of the
provisions of the certificate of incorporation or bylaws of the Company
which adversely affect the voting powers, rights or preferences of the
holders of shares of Series A Preferred Stock; (ii) the authorization or
creation of, or the increase in the authorized amount of, any shares of any
class or any security convertible into share of any class ranking prior to
the Series A Preferred Stock in the distribution of assets on any
liquidation, dissolution or winding up of the Company or in the payment of
dividends; or (iii) the merger or consolidation of the Company with or into
any other corporation, unless the resulting corporation will thereafter
have no class of shares and no other securities either authorized or
outstanding ranking prior to the Series A Preferred Stock in the
distribution of its assets on liquidation, dissolution or winding up or in
the payment of dividends, subject to limited exceptions.
The consent of the holders of at least a majority of the shares of
Series A Preferred Stock shall be necessary to effect or validate any
increase in the authorized amount of the Series A Preferred Stock, or the
authorization or creation of, or the increase in the authorized amount of
any shares or security convertible into shares ranking on a parity with the
Series A Preferred Stock in the distribution of assets on any liquidation,
dissolution or winding up of the Company or in the payment of dividends.
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
The Company's consolidated ratios of earnings to combined fixed charges
and preferred stock dividend requirements are shown in the table below. For
purposes of the following ratios: (i) "earnings" consist of loss before
reorganization items, income taxes and extraordinary items plus fixed charges;
and (ii) "fixed charges" consist of interest (including debt amortization) and
the estimated interest portion of lease payments.
In calculating the ratio of earnings to combined fixed charges and
preferred stock dividend requirements, the preferred stock dividend
requirements were assumed to be equal to the pretax earnings required to
cover such dividend requirements. The amount of such pretax earnings
required to cover preferred stock dividend requirements was computed using
tax rates for the applicable year.
<PAGE>
<PAGE> 11
<TABLE>
<CAPTION>
Fiscal
Fiscal Year Fiscal Year 1993 Year
Six Six
Months Months
Ended Ended
August 1, January 30,
1990 1991 1992 1993 1994 1994
(Predecessor Company) (Successor Company)
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to combined
fixed charges and preferred
stock dividend requirements ... 0.47x (0.31x) (0.05x) 0.01x (4.68x) (2.78x)
</TABLE>
The earnings coverage deficiencies (in thousands) were $11,683,
$28,645, $18,141, $8,022, $32,216 and $47,789 for fiscal years 1990, 1991
and 1992, the six months ended August 1, 1993, the six months ended
January 30, 1994 and fiscal year 1994, respectively.
SELLING STOCKHOLDERS
The following table sets forth certain information with respect to
the Selling Stockholders and reflects their ownership of the Company's
capital stock as of May 31, 1995. Such persons, pursuant to registration
rights, may sell all of the shares of the Common Stock and the Series A
Preferred Stock (or shares of Common Stock issuable upon conversion of the
Series A Preferred Stock) owned by them as of such date, or any lesser
portion thereof. Information as to beneficial ownership reflects
information currently available to the Company. In addition to the 972,332
shares of Common Stock registered for sale by Corimon Corporation as shown
in the table below, Corimon Corporation is entitled to have an additional
15,000,000 shares of Common Stock registered for sale but has not elected
to do so at this time. The shares of Series A Preferred Stock shown in the
table below represent all of the Series A Preferred Stock.
<TABLE>
<CAPTION>
Beneficial Ownership
Number of Shares Offered After Offering
Beneficial Series A
Ownership of Common Preferred Common Common
Name of Beneficial Owner Common Stock Stock Stock Stock(1) Stock(2) Percentage
<S> <C> <C> <C> <C> <C> <C>
Corimon Corporation(3) 23,922,342 972,332 190,288 1,529,161 15,112,360 53.1%
c/o Corimon, S.A.C.A. 785,025(4) 6,308,489(4)
Calle Hans Neumann
Edificio Corimon
Los Cortijos de Lourdes
Caracas, Venezuela 0171
Fidelity Capital &
Income Fund(5) 8,562,043 1,216,595 851,616 6,843,617 619,331 2.3%
82 Devonshire Street, F7E
Boston, Massachusetts 02109
Kodak Retirement Income Plan
Trust Fund(5) 1,610,140 228,807 160,165 1,287,092 116,441 *
c/o Fidelity Investments
82 Devonshire Street, F7E
Boston, Massachusetts 02109
Transamerica Life Insurance
and Annuity Company(6) 870,697 131,422 91,995 739,275 0 *
1150 South Olive Street
Los Angeles, CA 90015
<PAGE>
<PAGE> 12
Beneficial Ownership
Number of Shares Offered After Offering
Beneficial Series A
Ownership of Common Preferred Common Common
Name of Beneficial Owner Common Stock Stock Stock Stock(1) Stock(2) Percentage
<S> <C> <C> <C> <C> <C> <C>
Transamerica Occidental Life
Insurance Company(6) 1,084,691 131,422 91,995 739,275 213,994 *
1150 South Olive Street
Los Angeles, CA 90015
Sun Life Insurance(7) 131,422 131,422 91,995 739,275 0 *
Company of America
1 SunAmerica Center
Los Angeles, CA 90067
Anchor National Life
Insurance Company(7) 131,486 131,422 91,995 739,275 64 *
1 SunAmerica Center
Los Angeles, CA 90067
Libra Investments, Inc. 348,586 348,586 0 0 0 *
11766 Wilshire Blvd.
Los Angeles, CA 90025
Everest Capital Fund LP 43,500 43,500 0 0 0 *
P.O. Box 2458
20 Parliament Street
Corner House
Hamilton, BERMUDA
Everest Capital 56,500 56,500 0 0 0 *
International, Ltd.
P.O. Box 2458
20 Parliament Street
Corner House
Hamilton, BERMUDA
______________________
<FN>
* Less than 1%
(1) Represents shares of Common Stock issuable upon conversion of the
Series A Preferred Stock.
(2) Assumes the Selling Stockholder does not sell any other shares of
Common Stock. The Selling Stockholders may purchase and sell shares
of Common Stock not covered by this Prospectus from time to time.
(3) As reported on Schedule 13D filed with the Securities and Exchange
Commission on May 17, 1995. CRM beneficial ownership includes
15,972,332 shares, 1,529,161 shares issuable upon conversion of
Series A Preferred Stock, 6,308,489 shares issuable upon purchase and
conversion of Series A Preferred Stock and 112,360 shares under a Put
Agreement with Libra Investments, Inc. Corimon Corporation is a
wholly-owned subsidiary of Corimon, S.A.C.A., a Venezuelan
multinational retailer and producer of paint and related products.
(4) Includes shares issuable upon purchase and conversion of Series A
Preferred Stock. Upon such purchase and conversion, the shares of
Series A Preferred Stock (and Common Stock into which such shares are
convertible) available for sale by the other Selling Stockholders
would be proportionately reduced. See "Description of Capital
Stock."
(5) FCI beneficial ownership includes 1,718,426 shares and 6,843,617
shares issuable upon conversion of Series A Preferred Stock. KRI
beneficial ownership includes 323,048 shares and 1,287,092 shares
issuable upon conversion of Series A Preferred Stock. FCI is a
portfolio of an investment company registered under Section 8 of the
Investment Company Act of 1940, as amended. Fidelity Management &
Research Company, a Massachusetts corporation and an investment
adviser registered under Section 203 of the Investment Advisers Act
<PAGE>
of 1940 ("FMRC"), provides investment advisory services to FCI, to
certain other registered investment companies and to certain other
funds which are generally offered to limited groups of investors.
KRI is an account managed by Fidelity Management Trust Company, a
Massachusetts corporation and a bank as defined in Section 3(a)(6) of
the Securities Exchange Act of 1934, as amended ("FMTC"). FMRC and
FMTC are wholly owned subsidiaries of FMR Corp., a Massachusetts
corporation.
(6) TLIAC beneficial ownership includes 131,422 shares and 739,275 shares
issuable upon conversion of Series A Preferred Stock. TOLIC
beneficial ownership includes 345,416 shares and 739,275 shares
issuable upon conversion of Series A Preferred Stock. TOLIC is a
subsidiary of Transamerica Insurance Corporation of California which
is a subsidiary of Transamerica Corporation and is an affiliate of
TLIAC.
(7) As reported on Schedule 13D filed with the Securities and Exchange
Commission on May 26, 1995. SAFI beneficial ownership includes
131,422 shares and does not include 739,275 shares issuable upon
conversion of Series A Preferred Stock. ANLIC beneficial ownership
includes 131,486 shares and does not include 739,275 shares issuable
upon conversion of Series A Preferred Stock. SAFI and ANLIC
beneficial ownership do not include 129,936 shares owned by
SunAmerica Inc. ANLIC is a subsidiary of SAFI, which is a subsidiary
of SunAmerica Inc.
</FN>
/TABLE
<PAGE>
<PAGE> 13
Inasmuch as the conversion of the Company's Preferred Stock currently
depends upon a market price condition being met, which will be met, if at
all, only after approximately one month from May 16, 1995, the foregoing
persons may take the position that ownership of Preferred Stock does not
represent beneficial ownership of Common Stock.
PLAN OF DISTRIBUTION
The sale or distribution of the Offered Securities may be effected
directly to purchasers by the Selling Stockholders as principals or through
one or more underwriters, brokers, dealers or agents from time to time in
one or more transactions (which may involve crosses or block transactions)
(i) on any stock exchange or in the over-the-counter market, (ii) in
transactions otherwise than on any stock exchange or in the over-the-
counter market or (iii) through the writing of options (whether such
options are listed on an options exchange or otherwise) on, or settlement
of short sales of, the Offered Securities. Any of such transactions may be
effected at market prices prevailing at the time of sale, at prices related
to such prevailing market prices, at varying prices determined at the time
of sale or at negotiated or fixed prices, in each case as determined by the
Selling Stockholder or by agreement between the Selling Stockholder and
underwriters, brokers, dealers or agents, or purchasers. If the Selling
Stockholders effect such transactions by selling Offered Securities to or
through underwriters, brokers, dealers or agents, such underwriters,
brokers, dealers or agents may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders or
commissions from purchasers of Offered Securities for whom they may act as
agent (which discounts, concessions or commissions as to particular
underwriters, brokers, dealers or agents may be in excess of those
customary in the types of transactions involved). The Selling Stockholders
and any brokers, dealers or agents that participate in the distribution of
the Offered Securities may be deemed to be underwriters, and any profit on
the sale of Offered Securities by them and any discounts, concessions or
commissions received by any such underwriters, brokers, dealers or agents
may be deemed to be underwriting discounts and commissions under the
Securities Act.
Under the securities laws of certain states, the Offered Securities
may be sold in such states only through registered or licensed brokers or
dealers. In addition, in certain states the Offered Securities may not be
sold unless the Offered Securities have been registered or qualified for
sale in such state or an exemption from registration or qualification is
available and is complied with.
The Company will pay all of the expenses incident to the
registration, offering and sale of the Offered Securities to the public
hereunder other than commissions, fees and discounts of underwriters,
brokers, dealers and agents. The Company has agreed to indemnify the
Selling Stockholders and their agents and controlling persons against
certain liabilities, including liabilities under the Securities Act. The
Company estimates that the expenses of the offering to be borne by it will
be approximately $125,000.
VALIDITY OF OFFERED SECURITIES
The validity of the Offered Securities will be passed upon for the
Company by Sullivan & Cromwell, Los Angeles, California.
EXPERTS
The consolidated financial statements of the Company appearing
in the Company's Annual Report (Form 10-K) for the fiscal year ended
January 29, 1995, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements
are incorporated herein by reference in reliance upon such report given
upon the authority of such firm as experts in accounting and auditing.
<PAGE>
<PAGE> 1
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with the issuance and
distribution of the securities being registered, other than underwriting
compensation, are:
Filing Fee for Registration Statement . . . . . $ 18,632
Legal Fees and Expenses . . . . . . . . . . . . 50,000
Accounting Fees and Expenses . . . . . . . . . 15,000
Transfer Agent's Fees and Expenses . . . . . . 5,000
Blue Sky Fees and Expenses . . . . . . . . . . 10,000
Printing and Engraving Fees . . . . . . . . . . 25,000
Miscellaneous . . . . . . . . . . . . . . . . . 1,368
Total . . . . . . . . . . . . . . . . . . $ 125,000
The Company will pay all or substantially all of such expenses.
Item 14. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of Delaware provides, in
summary, that the directors and officers of the Company may, under certain
circumstances, be indemnified by the Company against all expenses incurred
by or imposed upon them as a result of actions, suits or proceedings
brought against them as such directors and officers, or as directors or
officers of any other organization at the request of the Company, if they
act in good faith and in a manner they reasonably believe to be in or not
opposed to the best interests of the Company, and with respect to any
criminal action or proceeding, have no reasonable cause to believe their
conduct was unlawful, except that no indemnification shall be made against
expenses in respect of any claim, issue or matter as to which they shall
have been adjudged to be liable to the Company unless and only to the
extent that the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, they are fairly and
reasonably entitled to indemnify for such expenses which such court shall
deem proper. Section 145 of the Delaware General Corporation Law also
provides that directors and officers of the Company are entitled to such
indemnification by the Company to the extent that such persons are
successful on the merits or otherwise in defending any such action, suit or
proceeding. The Company's Bylaws provide for the indemnification by the
Company of officers and directors to the fullest extent permitted by
Section 145 of the Delaware General Corporation Law.
Section 102 of the Delaware General Corporation Law provides that a
corporation, in its Certificate of Incorporation, may eliminate the
personal liability of its directors to the corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director, other than
liability for (1) any breach of the director's duty of loyalty to the
corporation or its stockholders, (2) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (3) any
transaction from which the director derived an improper personal benefit
and (4) unlawful payment of dividends or unlawful stock purchases or
redemptions. The Company's Certificate of Incorporation provides for the
elimination of personal liability of its directors as permitted by
Section 102 of the Delaware General Corporation Law.
The Company maintains a Director and Officer's Insurance Policy for
the benefit of its directors and officers.
<PAGE>
<PAGE> 2
Item 15. Exhibits.
4.1 Restated Certificate of Incorporation, as amended.
4.2 Amended and Restated By-Laws.
4.3 Certificate of Designations of Series A Preferred
Stock.
5.1 Opinion of Sullivan & Cromwell.
12.1 Statement regarding computation of ratio of earnings to
combined fixed charges and preferred stock dividend
requirements.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Sullivan & Cromwell (included in its opinion
filed as Exhibit 5.1).
24.1 Power of Attorney (included on signature page).
Item 16. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales of the
securities being registered are being made, a post-effective amendment to
this registration statement to include any material information with
respect to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in the
registration statement, including (but not limited to) any addition or
deletion of a managing underwriter.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions
described under Item 14 above, or otherwise, the registrant has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
<PAGE>
<PAGE> 3
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
<PAGE>
<PAGE> 4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Torrance, State of California, on
the 1st day of June, 1995.
STANDARD BRANDS PAINT COMPANY
(Registrant)
By:/s/ Juan J. Gramage
Juan J. Gramage
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Juan J. Gramage and Howard S.
Schwartz, and each of them, his true and lawful attorneys-in-fact and
agents, with full power or substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments, including post-effective amendments, to this Form S-3
Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in and about the premises, as
fully and to all intents and purposes as he might or could do in person
hereby ratifying and confirming all that said attorneys-in-fact and agents,
or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
<PAGE>
<PAGE> 5
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Capacity Date
<S> <C> <C>
/s/ Juan J. Gramage
Juan J. Gramage General Manager, President and Chief Operating
Officer and Director (Principal Executive Officer) June 1, 1995
/s/ Howard S. Schwartz
Howard S. Schwartz Senior Vice President and Chief Financial Officer
(Principal Financial Officer) June 1, 1995
/s/ Gary Van Wagner
Gary Van Wagner Controller (Principal Accounting Officer) June 1, 1995
/s/ Roland F. Breault
Roland F. Breault Director June 1, 1995
/s/ Thomas A. White
Thomas A. White Director June 1, 1995
/s/ Deborah Hicks Midanek
Deborah Hicks Midanek Director June 1, 1995
/s/ Gustavo Jose Blanco-Uribe
Gustavo Jose Blanco-Uribe Director June 1, 1995
/s/ Richard L. Boje
Richard L. Boje Director June 1, 1995
Robert N. Dangremond Director June 1, 1995
/s/ William E. Yingling, III
William E. Yingling, III Director June 1, 1995
</TABLE>
<PAGE> 1
EXHIBIT 4.1
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
STANDARD BRANDS PAINT COMPANY
Standard Brands Paint Company, a Delaware corporation, hereby
certifies as follows:
FIRST. The Board of Directors of said corporation duly adopted
a resolution setting forth and declaring advisable the amendment of Article
IV of the certificate of incorporation of said corporation to increase the
total number of shares of Common Stock which the corporation shall have au-
thority to issue from 30,000,000 shares of Common Stock of the par value of
$0.01 per share to 100,000,000 shares of Common Stock of the par value of
$0.01 per share, to effect a one-for-ten reverse stock split, and to
eliminate the prohibition on the issuance of non-voting equity stock, so
that, as amended, said Article shall read as follows:
"The Corporation is authorized to issue two classes of shares
of stock to be designated, respectively, "Common Stock" and
"Preferred Stock." The total number of shares which the Corporation
shall have authority to issue is one hundred five million
(105,000,000) shares, consisting of one hundred million
<PAGE>
<PAGE> 2
(100,000,000) shares of common stock having $.01 par value per share
("Common Stock") and five million (5,000,000) shares of preferred
stock having $.01 par value per share ("Preferred Stock"). Upon the
amendment of this Article IV effected by this Amendment, each 10
outstanding shares of Common Stock will be converted into 1 share of
Common Stock, provided that no fractional shares may be issued
pursuant to such change. The Corporation may, at its option, pay
cash for any fractional shares or round such fractional shares up to
the nearest whole number of shares.
The shares of Preferred Stock may be issued from time to time
in one or more series. The Board of Directors is hereby authorized
to fix by resolution or resolutions the voting rights, designations,
powers, preferences and the relative, participating, optional or
other rights, if any, and the qualifications, limitations or
restrictions thereof of any wholly unissued shares of Preferred
Stock; and to fix the number of shares constituting such series, and
to increase or decrease the number of shares of any such series, but
not below the number of shares thereof then outstanding."
SECOND. The foregoing amendment has been duly adopted by the
favorable vote of the holders of a majority
<PAGE>
<PAGE> 3
of the outstanding stock entitled to vote thereon in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, Standard Brands Paint Company has caused
this certificate to be signed by Howard Schwartz, its Senior Vice
President-Finance and Chief Financial Officer and Edward A. Drury, its
Corporate Secretary, on the 16th day of May, 1995.
By \s\ EDWARD A. DRURY
Edward A. Drury
By \s\ HOWARD SCHWARTZ
Howard Schwartz
<PAGE>
<PAGE> 1
RESTATED
CERTIFICATE OF INCORPORATION
OF
STANDARD BRANDS PAINT COMPANY
STANDARD BRANDS PAINT COMPANY, a corporation organized and
existing under the laws of the State of Delaware, hereby certifies as
follows:
1. The name of the Corporation is STANDARD BRANDS PAINT
COMPANY. STANDARD BRANDS PAINT COMPANY was originally incorporated under
the name STANDARD BRANDS PAINT COMPANY (DELAWARE) and the original
Certificate of Incorporation of the Corporation was filed with the
Secretary of State of Delaware on June 5, 1987.
2. This Restated Certificate of Incorporation has been adopted
pursuant to the authority of Section 303 of the General Corporation of the
State of Delaware.
3. Pursuant to Section 303 of the General Corporation Law of
the State of Delaware, this Restated Certificate of Incorporation restates
and integrates and further amends the provisions of the Certificate of
Incorporation of this Corporation.
4. The text of the Certificate of Incorporation is hereby
restated and amended to read in its entirety as follows:
<PAGE>
<PAGE> 2
ARTICLE I
The name of the Corporation is STANDARD BRANDS PAINT COMPANY.
ARTICLE II
The address of the registered office of the Corporation in the
State of Delaware is 1209 Orange Street, County of New Castle,
Wilmington, Delaware 19801, and the name of its registered agent at
that address is The Corporation Trust Company.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.
ARTICLE IV
The Corporation is authorized to issue two classes of shares of
stock to be designated, respectively, "Common Stock" and "Preferred
Stock." The total number of shares which the Corporation shall have
authority to issue is thirty-five million (35,000,000) shares,
consisting of thirty million (30,000,000) shares of common stock
having $.01 par value per share ("Common Stock") and five million
(5,000,000) shares of preferred stock having $.01 par value per share
<PAGE>
<PAGE> 3
("Preferred Stock"). The Corporation is prohibited from issuing non-
voting equity stock.
The shares of Preferred Stock may be issued from time to time
in one or more series. The Board of Directors is hereby authorized
to fix by resolution or resolutions the voting rights, designations,
powers, preferences and the relative, participating, optional or
other rights, if any, and the qualifications, limitations or
restrictions thereof of any wholly unissued shares of Preferred
Stock; and to fix the number of shares constituting such series, and
to increase or decrease the number of shares of any such series, but
not below the number of shares thereof then outstanding.
ARTICLE V
In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized to make,
repeal, alter, amend and rescind the Bylaws of the Corporation.
ARTICLE VI
A director of the Corporation shall not be personally liable to
the Corporation or its stockholders for monetary damages for breach
of the director's fiduciary duty as a director, except for liability
(i) for any breach of the director's duty of
<PAGE>
<PAGE> 4
loyalty to the Corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) under Section 174 of the General
Corporation Law of the State of Delaware or (iv) for any transaction
from which the director derived an improper personal benefit.
ARTICLE VII
This Corporation shall indemnify its officers, directors,
employees, and agents to the maximum extent permitted by the General
Corporation Law of the State of Delaware, as now and hereinafter
enacted (with any and all amendments thereto), including, but not
limited to, the right to make indemnification contracts.
ARTICLE VIII
The Corporation shall have perpetual existence.
IN WITNESS WHEREOF, this Restated Certificate of Incorporation
has been signed under the seal of the Corporation this 14th day of June,
1993.
STANDARD BRANDS PAINT COMPANY,
By \s\ STUART D. BUCHALTER
Stuart D. Buchalter,
Chairman of the Board
<PAGE>
<PAGE> 5
[SEAL]
Attest:
\s\ TERRIE ROGERS
Terrie Rogers,
Assistant Secretary
<PAGE> 1
EXHIBIT 4.2
AMENDED AND RESTATED
BY-LAWS
OF
STANDARD BRANDS PAINT COMPANY
ARTICLE I
OFFICES
Section 1. Registered Office.
The registered office of Standard Brands Paint Company
(hereinafter called the "Corporation") in the State of Delaware shall be at
1209 Orange Street, Wilmington, Delaware 19801, and the name of the
registered agent at that address shall be The Corporation Trust Company.
Section 2. Principal Offices.
The board of directors of the Corporation (the "Board of
Directors") shall fix the location of the principal executive office of the
Corporation at any place within or without the State of Delaware as the
Board of Directors determines from time to time or as the business of the
Corporation may require.
Section 3. Other Offices.
The Corporation may also have an office or offices at such
other place or places, either within or without the State of Delaware, as
the Board of Directors may from time to time determine or as the business
of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. Place of Meetings.
Meetings of the stockholders of the Corporation
("Stockholders") shall be held at any place within or without the State of
Delaware designated by the Board of Directors. In the absence of any such
designation, the Stockholders' meetings shall be held at the principal
executive office of the Corporation.
<PAGE>
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Section 2. Annual Meetings.
The annual meetings of the Stockholders of the Corporation may
be called at any time by the Chairman of the Board, if any, the Vice
Chairman of the Board, if any, the President or the Board of Directors, to
be held at such date, time and place either within or without the State of
Delaware as may be stated in the notice of the meeting.
Section 3. Special Meetings.
Special meetings of the Stockholders may be called by the Board
of Directors pursuant to a resolution adopted by a majority of the
directors then in office.
Section 4. Notice of Stockholders' Meetings.
Except as otherwise required or permitted by law, whenever the
Stockholders are required or permitted to take any action at a meeting,
written notice thereof shall be given, stating the place, date and time of
the meeting, and, in the case of a special meeting, the purpose or purposes
for which the meeting is called. The notice shall also designate the place
where the Stockholders list is available for examination, unless the list
is kept at the place where the meeting is to be held. A copy of the notice
of any meeting shall be delivered personally or shall be mailed, not less
than ten (10) and no more than sixty (60) days before the date of the
meeting, to each Stockholder of record entitled to vote at such meeting.
If mailed, such notice shall be deemed to be given when deposited in the
United States mail, postage prepaid, and shall be directed to each
Stockholder at its address as it appears on the record of Stockholders,
unless it shall have filed with the Secretary of the Corporation a written
request that notices be mailed to some other address, in which case it
shall be directed to the Stockholder at such other address. Notice of any
meeting of Stockholders shall not be required to be given to any
Stockholder who shall attend the meeting, except if such Stockholder shall
attend for the express purpose of objecting at the beginning thereof to the
transaction of any business because the meeting is not lawfully called or
convened, such Stockholder shall submit, either before or after the
meeting, a signed waiver of notice. Unless the Board of Directors, after
the adjournment, shall fix a new record date for an adjourned meeting or
unless the adjournment is for more than thirty (30) days, notice of an
adjourned meeting need not be given if the place, date and time to which
the meeting shall be adjourned is announced at the meeting at which the
adjournment is taken.
Section 5. Quorum.
Except as otherwise provided by law or by the certificate of
incorporation of the Corporation (the "Certificate of Incorporation"), the
presence in person or by
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proxy of the holders of a majority of the shares entitled to vote at the
meeting of Stockholders shall constitute a quorum for the transaction of
business. The Stockholders present at a duly called or held meeting at
which a quorum is present may continue to do business until adjournment,
notwithstanding the withdrawal of enough Stockholders to leave less than a
quorum, if any action taken (other than adjournment) is approved by at
least a majority of the shares required to constitute a quorum.
Section 6. Voting.
A Stockholder may vote in person or by proxy. Except as
otherwise provided by law, the Certificate of Incorporation or these
Bylaws, any corporate action to be taken by a vote of Stockholders shall be
authorized by the affirmative vote of the majority of shares present in
person or represented by proxy at the meeting and entitled to vote thereon.
Directors shall be elected as provided in Section 3 of Article
III of these Bylaws. Written ballots shall not be required for voting on
any matter, unless otherwise provided by the Certificate of Incorporation.
Section 7. Proxies.
Each Stockholder entitled to vote at a meeting of Stockholders
or to express consent or dissent to corporate action in writing without a
meeting may authorize another person or persons to act for such Stockholder
by proxy, but no such proxy shall be voted or acted upon after three years
from its date, unless the 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, regardless of whether the interest with
which it is coupled is an interest in the stock itself or an interest in
the Corporation generally. A Stockholder may revoke any proxy which is not
irrevocable by attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or another duly executed proxy
bearing a later date with the Secretary of the Corporation. Voting at
meetings of Stockholders need not be by written ballot and need not be con-
ducted by inspectors unless the holders of a majority of the outstanding
shares of all classes of stock entitled to vote thereon present in person
or represented by proxy at such meeting shall so determine.
Section 8. Inspectors of Election.
Before any meeting of Stockholders, the Board of Directors may
appoint any persons other than nominees for office to act as inspectors of
election at the meeting or its
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adjournment. If no inspectors of election are appointed, the chairman of
the meeting may, and on the request of the holders of ten percent (10%) of
the stock entitled to vote at such election shall, appoint inspectors of
election at the meeting. No candidate for the office of Director shall be
appointed inspector. The number of inspectors shall either be one (1) or
three (3). If inspectors are appointed at a meeting on the request of ten
percent (10%) of the Stockholders or proxies, the holders of a majority of
shares or their proxies present at the meeting shall determine whether one
(1) or three (3) inspectors are to be appointed. If any person appointed
as inspector fails to appear or fails or refuses to act, the vacancy may be
filled by appointment by the Board of Directors before the meeting, or by
the chairman at the meeting.
The duties of these inspectors shall be as follows:
(i) Determine the number of shares outstanding and the voting
power of each, the shares represented at the meeting, the existence
of a quorum, and the authenticity, validity and effect of proxies;
(ii) Receive votes, ballots or consents;
(iii) Hear and determine all challenges and questions in any
way arising in connection with the right to vote;
(iv) Count and tabulate all votes or consents;
(v) Determine the election result; and
(vi) Do any other acts that may be proper to conduct the
election or vote with fairness to all Stockholders.
Section 9. Action Without Meeting.
Unless otherwise provided in the Certificate of Incorporation
of the Corporation, 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 or consents in writing, setting
forth the action so taken, shall be signed, in person or by proxy, by the
holders of outstanding stock having not less than the minimum number of
votes that would be necessary to authorize or take the action at a meeting
at which all shares entitled to vote thereon were present and voted in
person or by proxy. Prompt notice of the taking of the corporate action
without a meeting by less than unanimous written consent shall be given to
those Stockholders who have not consented in writing, but who were entitled
to vote on the matter.
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ARTICLE III
BOARD OF DIRECTORS
Section 1. Powers.
Subject to the provisions of the Delaware General Corporation
Law and any limitations in the Certificate of Incorporation and these
Bylaws relating to action required to be approved by the Stockholders or by
the outstanding shares, the business and affairs of the Corporation shall
be managed and all corporate powers shall be exercised by or under the
direction of the Board of Directors.
Without prejudice to such general powers, but subject to the
same limitations, it is hereby expressly declared that the Board of
Directors shall have the power and authority to:
(i) Select and remove all officers, agents and employees of
the Corporation and prescribe such powers and duties for them as may
not be inconsistent with law, with the Certificate of Incorporation
or these Bylaws.
(ii) Change the principal executive office or the principal
business office in or outside of the State of Delaware from one
location to another; cause the Corporation to be qualified to do
business in any other state, territory, dependency or foreign country
and conduct business within or without the State; designate any place
within or without the State for the holding of any Stockholders'
meeting or meetings, including annual meetings; adopt, make and use a
corporate seal, and prescribe the forms of certificates of stock, and
alter the form of such seal and of such certificates from time to
time as in their judgment they may deem best, provided that such
forms shall at all times comply with the applicable provisions of
law.
(iii) Authorize the issuance of shares of stock of the
Corporation from time to time, upon such terms as may be lawful.
(iv) Borrow money and incur indebtedness for the purpose of
the Corporation, and cause to be executed and delivered therefor, in
the corporate name, promissory notes, bonds, debentures, deeds of
trust, mortgages, pledges, hypothecations and other evidences of debt
and securities therefor.
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Section 2. Number of Board of Directors.
The Board of Directors shall consist of not less than eight (8)
nor more than twelve (12) members. Until such time as the Board of
Directors determines otherwise, the number of directors shall be eight (8).
The number of Directors of the Board of Directors may be reduced or
increased from time to time by action of a majority of the Board of
Directors, but no such decrease may shorten the term of an incumbent
Director. When used in these Bylaws, the phrase "entire Board of
Directors" means the total number of directors which the Corporation would
have in office if there were no vacancies.
Section 3. Election and Term of Office of Directors.
The Directors shall be elected by the Stockholders of the
Corporation, and at each election the persons receiving the greatest number
of votes, up to the number of Directors then to be elected, shall be the
persons then elected. The election of Directors is subject to any
provision contained in the Certificate of Incorporation relating thereto.
Nominations of persons to serve as Directors must be submitted to the
Secretary of the Corporation not less than forty-five (45) days prior to
the meeting of the Stockholders at which Directors shall be elected. At
each annual meeting of the Stockholders of the Corporation, the successors
of the Directors whose term expires at that meeting shall be elected to
hold office for a term expiring at the next annual meeting of Stockholders.
Subject to his earlier death, resignation or removal, each Director shall
hold office until his successor shall have been duly elected and shall have
qualified.
Section 4. Removal.
Subject to the limitations set forth in Section 141(k) of the
General Corporation Law of Delaware, the Board of Directors, or any
individual Director, may be removed from office, with or without cause, and
a new Director or Directors elected by a vote of Stockholders holding a
majority of the outstanding shares entitled to vote at an election of
Directors.
Section 5. Resignations.
Any Director may resign effective upon giving written notice to
the Chairman of the Board of Directors, the President, the Secretary or the
Board of Directors, unless the notice specifies a later time for the
effectiveness of such resignation, in which case such resignation shall be
effective at the time specified. Unless such resignation specifies
otherwise, its acceptance by the Corporation shall not be necessary to make
it effective.
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Section 6. Vacancies.
Any vacancy in the Board of Directors arising from an increase
in the number of Directors or otherwise may be filled by a vote of the
majority of the Directors then in office, though less than a quorum, or by
a sole remaining Director. Subject to the earlier death, resignation or
removal of a Director, each Director so elected shall hold office until the
next election of the class for which such Director shall have been chosen,
and until his successor shall be elected and qualified.
A vacancy in the Board of Directors exists as to any authorized
position of Director which is not then filled by a duly elected Director,
whether caused by death, resignation, removal or increase in the authorized
number of Directors or otherwise.
Section 7. Place of Meetings.
Meetings of the Board of Directors of the Corporation shall be
held at any place within or without the State of Delaware designated by the
Board of Directors.
Section 8. Annual Meeting.
The annual meeting of the Board of Directors shall be held as
soon as practicable after the annual meeting of Stockholders on such date
and at such time and place as the Board of Directors determines.
Section 9. Regular Meetings.
Regular meetings of the Board of Directors shall be held on
such dates and at such places and times as the Board of Directors
determines. In the absence of such determination, regular meetings shall
be held at the principal executive office of the Corporation. Notice of
such regular meetings need not be given, except as otherwise required by
law. If any day fixed for a meeting shall be a legal holiday at the place
where the meeting is to be held, then the meeting shall be held at the same
hour and place on the next succeeding business day not a legal holiday.
Section 10. Special Meetings.
Special meetings of the Board of Directors for any purpose or
purposes may be called at any time by the Chairman of the Board or the
President or a majority of the Directors, to be held at the principal
offices of the Corporation or at such other place or places, within or
without the State of Delaware, as the person or persons calling the meeting
may designate.
Notice of the time and place of special meetings shall be
delivered personally or by telephone to each Director
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<PAGE> 8
or sent by first-class mail or telegram, charges prepaid, addressed to each
Director at his address as it is shown upon the records of the Corporation.
In case such notice is mailed, it shall deposited in the United States mail
at least two (2) days prior to the time of the holding of the meeting. In
case such notice is delivered personally, or by telephone or telegram, it
shall be delivered personally or by telephone or to the telegraph office at
least forty-eight (48) hours prior to the time of the holding of the
meeting. Any oral notice given personally or by telephone may be
communicated to either the Director or to a person at the office of the
Director whom the person giving the notice has reason to believe will
promptly communicate it to the Director. The notice need not specify the
purpose of the meeting nor the place if the meeting is to be held at the
principal executive office of the Corporation.
Section 11. Quorum.
Except as otherwise provided by law, the Certificate of
Incorporation or these Bylaws, at all meetings of the Board of Directors,
six (6) of the elected Directors shall constitute a quorum for the
transaction of business, and the vote of a majority of the Directors pres-
ent at a meeting at which a quorum is present shall be the act of the Board
of Directors, except as specifically provided by the law of the State of
Delaware, the Certificate of Incorporation, these Bylaws or any contract or
agreement to which the Corporation is a party. Notice of any adjourned
meeting need not be given.
Section 12. Conduct of Meetings.
Meetings of the Board of Directors shall be presided over by
the Chairman of the Board, if any, or in the absence of the Chairman of the
Board by the Vice Chairman of the Board, if any, or in the absence of the
Vice Chairman of the Board by the President, or in their absence by a
chairman chosen at the meeting. The Secretary, or in the absence of the
Secretary an Assistant Secretary, shall act as secretary of the meeting,
but in the absence of the Secretary and any Assistant Secretary the
chairman of the meeting may appoint any person to act as secretary of the
meeting.
Section 13. Waiver of Notice.
The transactions of any meeting of the Board of Directors,
however called and noticed or wherever held, shall be as valid as though
taken at a meeting duly held after regular call and notice if a quorum is
present and if, either before or after the meeting, each of the Directors
not present signs a written waiver of notice, a consent to holding the
meeting or an approval of the minutes thereof. The waiver of notice or
consent need not specify the purpose of the meeting.
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All such waivers, consents and approvals shall be filed with the corporate
records or made a part of the minutes of the meeting. Notice of a meeting
shall also be deemed given to any Director who attends the meeting without
protesting, prior thereto or at its commencement, the lack of notice to
such Director.
Section 14. Adjournment.
A majority of the Directors present, whether or not
constituting a quorum, may adjourn any meeting to another time and place.
Section 15. Notice of Adjournment.
Notice of the time and place of holding an adjourned meeting
need not be given, unless the meeting is adjourned for more than twenty-
four (24) hours, in which case notice of such time and place shall be given
prior to the time of the adjourned meeting, in the manner specified in
Section 10 of this Article III, to the Directors who were not present at
the time of the adjournment.
Section 16. Action Without Meeting.
Any action required or permitted to be taken at any meeting of
the Board of Directors, or of any committee thereof, may be taken without a
meeting if all members of the Board or of such 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.
Section 17. Fees and Compensation of Directors.
Directors and members of committees may receive such
compensation, if any, for their services and such reimbursement of
expenses, as may be fixed or determined by resolution of the Board of
Directors. Nothing herein contained shall be construed to preclude any
Director from serving the Corporation in any other capacity as an officer,
agent, employee or otherwise and receiving compensation for such services.
Section 18. Committees of Directors.
The Board of Directors may, by these Bylaws or resolutions
passed by a majority of the whole Board of Directors, designate one or more
committees, each consisting of one or more Directors, to serve at the
pleasure of the Board of Directors. The Board of Directors 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 a member of a committee, 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
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another member of the Board of Directors to act at the meeting in place of
any such absent or disqualified member. Any such committee, to the extent
provided in these Bylaws or the resolutions of the Board of Directors,
shall have and may exercise all of the powers and authority of the Board of
Directors in the management of the business and affairs of the Corporation
and may authorize the seal of the Corporation to be affixed to all papers
which may require such seal; but no such committee shall have the power or
authority in reference to amending the Certificate of Incorporation,
adopting an agreement of merger or consolidation, recommending to the
Stockholders the sale, lease or exchange of all or substantially all of the
Corporation's property and assets, recommending to the Stockholders a
dissolution of the Corporation or revocation of a dissolution, or amending
the Bylaws of the Corporation; and, unless a resolution of the Board of
Directors, these Bylaws or the Certificate of Incorporate expressly so
provide, no such committee shall have the power or authority to declare a
dividend, to adopt a certificate of ownership and merger pursuant to
Section 253 of the Delaware General Corporation Law, or to authorize the
issuance of stock. Any such committee shall keep written minutes of its
meetings and report the same to the Board of Directors at the next regular
meeting of the Board of Directors.
Section 19. Meetings and Action of Committees.
Meetings and action of committees shall be governed by, and
held and taken in accordance with, the provisions of this Article III with
such changes in the context of these Bylaws as are necessary to substitute
the committee and its members for the Board of Directors and its members,
except that the time of regular meetings of committees may be determined by
resolution of the Board of Directors as well as the committee, special
meetings of committees may also be called by resolutions of the Board of
Directors and notice of special meetings of committees shall also be given
to all alternate members, who shall have the right to attend all meetings
of the committee. The Board of Directors may adopt rules for the
governance of any committee not inconsistent with the provisions of these
Bylaws.
Section 20. Executive Committee.
The Board of Directors may, in each year, by the affirmative
vote of a majority of the entire Board of Directors, elect from the
Directors an executive committee (the "Executive Committee") to consist of
such number of Directors (not less than three) as the Board of Directors
may from time to time determine. The chairman of the Executive Committee
shall be elected by the Board of Directors. The Board of Directors by such
affirmative vote shall have power
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at any time to change the members of the Executive Committee and may fill
vacancies in the Executive Committee by election from the Directors. When
the Board of Directors is not in session, the Executive Committee shall
have and may exercise, subject to the powers, duties and responsibilities
vested by these Bylaws in the Finance Committee of the Board of Directors
of this Corporation, any or all of the powers of the Board of Directors in
the management of the business and affairs of the Corporation (including
the power to authorize the seal of the Corporation to be affixed to all
papers which may require it), except as provided by law or any contract or
agreement to which the Corporation is a party and except the power to
increase or decrease the size of, or fill vacancies on, the Board of
Directors, to remove or appoint executive officers or to dissolve or change
the permanent membership of the Executive Committee, and the power to make
or amend these Bylaws. The Executive Committee may fix its own rules of
procedure, and may meet when and as provided by such rules or resolutions
of the Board of Directors, but in every case, the presence of a majority
shall be necessary to constitute a quorum. In the absence of any member of
the Executive Committee, the members thereof present at any meeting,
whether or not they constitute a quorum, may appoint a member of the Board
of Directors to act in the place of such absent member.
Section 21. Finance Committee.
The Board of Directors may, in each year, by the affirmative
vote of a majority of the entire Board of Directors, elect from the
Directors a finance committee (the "Finance Committee") to consist of such
number of Directors (not less than three) as the Board of Directors may
from time to time determine. The chairman of the Finance Committee shall
be elected by the Board of Directors. The Board of Directors by such
affirmative vote shall have the power at any time to change the members of
the Finance Committee and may fill vacancies in the Finance Committee by
election from the Directors. The powers, functions and duties of the
Finance Committee shall include (i) the review, on a continuing basis, of
the Corporation's financial policies and the implementation of such
policies and the making of appropriate recommendations to the Board of
Directors for the modification or continuation thereof, (ii) the review of
the Corporation's basic financial plans prior to submission thereof to the
Board of Directors, (iii) the review of possible or proposed acquisitions,
divestitures and capital expenditures and the authority to approve capital
expenditures within the financial limits from time to time established by
the Board of Directors, (iv) the review of the Corporation's asset and
liability management programs and (v) such other powers, functions and
duties as may, from time to time, be delegated to the Finance Committee by
the Board of Directors. From time to time, various
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executives and counsel to the Corporation may be selected by the chairman
of the Finance Committee in consultation with the Chairman of the Board of
Directors and President of the Corporation to serve as consultants to the
Finance Committee on a permanent or temporary basis, as appropriate. The
Finance Committee may fix its own rules of procedures, and may meet when
and as provided by such rules or resolutions of the Board of Directors, but
in every case, the presence of a majority shall be necessary to constitute
a quorum.
Section 22. Compensation Committee.
The Board of Directors may, in each year, by the affirmative
vote of a majority of the entire Board of Directors, elect from the
Directors a compensation committee (the "Compensation Committee") to
consist of such number of Directors (not less than three) as the Board of
Directors may from time to time determine. The chairman of the
Compensation Committee shall be elected by the Board of Directors. The
Board of Directors by such affirmative vote shall have the power at any
time to change the members of the Compensation Committee and may fill
vacancies in the Compensation Committee by election from the Directors.
The powers, functions and duties of the Compensation Committee shall
include (i) the review of and the making of recommendations to the Board
regarding compensation, both direct and indirect, of the chief executive
officers and other members of executive management of the Corporation, (ii)
the review and submission of recommendations regarding new executive
compensation plans to the full Board of Directors, (iii) the establishment
and periodic review of the Corporation's policies relating to executive
perquisites, (iv) the administration of executive incentive compensation
plans and (v) such other powers, functions and duties as may, from time to
time, be delegated to the Compensation Committee by the Board of Directors.
From time to time, various executives and counsel to the Corporation may be
selected by the chairman of the Compensation Committee in consultation with
the Chairman of the Board of Directors and President of the Corporation to
serve as consultants to the Compensation Committee on a permanent or
temporary basis, as appropriate. The Compensation Committee may fix its
own rules or procedures, and may meet when and as provided by such rules or
resolutions of the Board of Directors, but in every case, the presence of a
majority shall be necessary to constitute a quorum.
Section 23. Audit Committee.
The Board of Directors may, in each year, by the affirmative
vote of a majority of the entire Board of Directors, elect from the
Directors an audit committee (the "Audit Committee") to consist of such
number of Directors (not less than three) as the Board of Directors may
from time to
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time determine. The chairman of the Audit Committee shall be elected by
the Board of Directors. The Board of Directors by such affirmative vote
shall have the power at any time to change the members of the Audit
Committee and may fill vacancies in the Audit Committee by election from
the Directors. The powers, functions and duties of the Audit Committee
shall include (i) recommendations regarding the appointment of independent
auditors of the Corporation, (ii) consultation with such independent
auditors regarding the plan of any audits, (iii) review of the audit report
and management letter, (iv) consultations with the independent auditors
regarding the adequacy of the Corporation's system of internal controls,
(v) meeting with the internal auditors to review the results of the
Corporation's internal audits and (vi) such other powers, functions and
duties as may, from time to time, be delegated to the Audit Committee by
the Board of Directors. From time to time, various executives and counsel
to the Corporation may be selected by the chairman of the Audit Committee
in consultation with the Chairman of the Board of Directors and President
of the Corporation to serve as consultants to the Audit Committee on a
permanent or temporary basis, as appropriate. The Audit Committee may fix
its own rules of procedures, and may meet when and as provided by such
rules or by resolution of the Board of Directors, but in every case,
presence of a majority shall be necessary to constitute a quorum.
Section 24. Meetings Held Other Than in Person.
Members of the Board of Directors or any committee may
participate in a meeting of the Board of Directors or 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, and such participation shall constitute presence in person
at the meeting.
Section 25. Remuneration.
The Directors shall be paid such remuneration, if any, as the
Board of Directors may from time to time determine. Any remuneration so
payable to a Director who is also an officer or employee of the Corporation
or who is counsel or solicitor to the Corporation or otherwise serves it in
a professional capacity shall, unless the Board of Directors shall
otherwise determine, be in addition to his salary as such officer or
employee or to his professional fees as the case may be. In addition, the
Board of Directors may by resolution from time to time award special
remuneration out of the funds of the Corporation to any Director who
performs any special work or service for or undertakes any special mission
on behalf of the Corporation outside of the work or services ordinarily
required of a Director of a Corporation.
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The Directors shall also be paid such sums in respect of their out-of-
pocket expenses incurred in attending meetings of the Board of Directors or
otherwise in respect of the performance by them of their duties as the
Board of Directors may from time to time determine. Confirmation by the
Stockholders of any such remuneration or payment shall not be required.
Section 26. Mandatory Retirement.
All Directors upon reaching the age of seventy-two (72) years
shall thereupon be ineligible to stand for reelection to the Board of
Directors, and such directorship shall automatically terminate effective
upon the first to occur of (i) the resignation of such Director pursuant to
call therefor by the Chairman of the Board of Directors; (ii) the
nomination and election to the Board of Directors of a successor
replacement for such Director; or (iii) the attainment of such Director's
73rd birthday. The provisions of this Section shall apply only to members
of the Board of Directors of this Corporation who are first elected on
July 1, 1987 or thereafter and shall not apply to persons who are members
of the Board of Directors as of June 30, 1987.
ARTICLE IV
OFFICERS
Section 1. Executive Officers.
The executive officers of the Corporation shall be the Chairman
of the Board of Directors, the President, one or more Vice-Presidents (the
number of to be determined by the Board of Directors), the Secretary and
the Treasurer and such other officers as may be appointed in accordance
with the provisions of Section 3 of this Article IV.
Section 2. Election of Officers.
The officers of this Corporation, except such officers as may
be appointed in accordance with the provisions of Section 3 or Section 5 of
this Article IV, shall be chosen by the Board of Directors, and each shall
serve for one year, subject to the rights, if any, of an officer under any
contract of employment.
Any two offices, except those of President and Vice-President,
may be held by the same person, but no officer shall execute, acknowledge
or verify any instrument in more than one capacity if such instrument is
required by law or these Bylaws to be executed, acknowledged or verified by
two or more officers.
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Section 3. Subordinate Officers.
The Board of Directors or the Executive Committee may appoint
and may empower the Chairman of the Board and the President to appoint such
other officers as the business of the Corporation may require, each of whom
shall hold office for such period, have such authority and perform such
duties as are provided in these Bylaws or as the Board of Directors may
from time to time determine.
Section 4. Removal and Resignation of Officers.
Subject to the rights, if any, of an officer under any contract
of employment, any officer may be removed, either with or without cause, by
the Board of Directors, at any regular or special meeting thereof, or,
except in the case of an officer chosen by the Board of Directors, by any
officer upon whom such power of removal may be conferred by the Board of
Directors.
Any officer may resign at any time by giving written notice to
the Corporation. Any such resignation shall take effect on the date of
receipt of such notice or at any later time specified therein; and, unless
otherwise specified therein, the acceptance of such resignation shall not
be necessary to make it effective. Any such resignation is without
prejudice to the rights, if any, of the Corporation under any contract to
which the officer is a party.
Section 5. Vacancies in Offices.
A vacancy in any office because of death, resignation, removal,
disqualification or any other cause shall be filled in the manner
prescribed in these Bylaws for regular appointments to such office.
Section 6. Chairman.
The Chairman of the Board of Directors shall be the chief
executive officer of the Corporation (provided that the Chairman may
appoint any other officer of the Corporation to serve as chief executive
officer for any reasonable period of time); shall, if present, preside at
all meetings of the Stockholders and the Board of Directors; shall, subject
to the control of the Board of Directors, have general supervision,
direction and control of the business and officers of the Corporation; and
shall exercise and perform such other powers and duties as may from time to
time be assigned to him by the Board of Directors or prescribed by these
Bylaws.
Section 7. President.
Subject to such supervisory powers, if any, as may be given by
these Bylaws or the Board of Directors to the Chairman of the Board of
Directors, if there be such an officer, the President shall be the chief
operating officer of
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<PAGE> 16
the Corporation. He shall, subject to the control of the Board of
Directors and Chairman of the Board of Directors, have general supervision,
direction and control of the operations of the Corporation, and he shall
have the general powers usually vested in the chief operating officer of a
corporation. In the absence or disability of the Chairman of the Board of
Directors, the President shall perform all of the duties of the Chairman of
the Board of Directors, and when so acting shall have all the powers of,
and be subject to all of the restrictions upon, the Chairman of the Board
of Directors. The President shall have such other duties or powers as may
be prescribed by the Board of Directors or these Bylaws.
Section 8. Vice Presidents.
In the absence or disability of the President, the Vice-
Presidents, in order of their rank as fixed by the Board of Directors, or
if not ranked, the Vice-President designated by the Board of Directors,
shall perform all 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. The Vice-Presidents shall have such other powers and perform
such other duties as from time to time may be prescribed for them
respectively by the Board of Directors or these Bylaws.
Section 9. Secretary.
The Secretary shall keep or cause to be kept, at the principal
executive office of the Corporation or such other place as the Board of
Directors may order, a book of minutes of all meetings of Directors,
committees of Directors and Stockholders, with the time and place of
holding, whether regular or special, and, if special, how authorized, the
notice thereof given, the names of those present at Directors' and
committee meetings, the number of shares present and represented at
Stockholders' meetings and the proceeding thereof.
The Secretary shall keep, or cause to be kept, at the principal
executive office of the Corporation or at the office of the Corporation's
transfer agent or registrar, as determined by resolution of the Board of
Directors, a share register, or a duplicate share register, showing the
names of all Stockholders and their addresses, the number and class of
shares held by each Stockholder, the number and date of certificates issued
for the same, and the number and date of cancellation of every certificate
surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all
meetings of the Stockholders and of the Board of Directors required to be
given by these ByLaws, and he shall
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keep the seal of the Corporation in safe custody, as may be prescribed by
the Board of Directors or these Bylaws.
Section 10. Treasurer.
The Treasurer shall have the powers and duties customary to the
office and as the Board of Directors may from time to time provide.
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS,
EMPLOYEES AND OTHER AGENTS
Section 1. Agents, Proceedings and Expenses.
For the purposes of this Article, "agent" means any person who
is or was a director, officer, employee, or other agent of this
Corporation, or is or was serving at the request of this Corporation as a
director, officer, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust or other enterprise, or was
a director, officer, employee, or agent of a foreign or domestic
corporation, which was a predecessor corporation of this Corporation or of
another enterprise at the request of such predecessor corporation;
"proceeding" means any threatened, pending or completed action or
proceeding, whether civil, criminal, administrative, or investigative; and
"expenses" includes, without limitation, attorneys' fees and any expenses
of establishing a right to indemnification under this Article.
Section 2. Actions Other Than by the Corporation.
This Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any proceeding (other than an
action by or in the right of the Corporation) by reason of the fact that
such person is or was an agent of this Corporation against expenses
(including attorneys' fees); judgments, fines and amounts paid in
settlements and other amounts actually and reasonably incurred in
connection with such proceeding if such person acted in good faith and in a
manner that such person reasonably believed to be in or not opposed to the
best interests of the Corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe the conduct of such
person was unlawful. The termination of any proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which the person reasonably believed
to be in the best interests of this Corporation, or that the person had
reasonable cause to believe that the person's conduct was unlawful.
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<PAGE> 18
Section 3. Actions by the Corporation.
This Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action by or in the right of this Corporation to procure a
judgment in its favor by reason of the fact that such person is or was an
agent of this Corporation against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection with the
defense or settlement of that action or suit if such person acted in good
faith and in a manner that such person reasonably believed to be in or not
opposed to the best interests of this Corporation, except that no
indemnification shall be made in respect of any proceeding as to which such
person shall have been adjudged to be liable for negligence or misconduct
in the performance of his duty to the Corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication
of liability but in view of all circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
Section 4. Indemnification Against Expenses of Successful
Party.
Notwithstanding the other provisions of this Article, to the
extent that an agent of this Corporation has been successful on the merits
or otherwise in the defense of any suit or proceeding referred to in
Section 2 or 3 of this Article, or in defense of any claim, issue or matter
therein, the agent shall be indemnified against expenses actually and
reasonably incurred by the agent in connection therewith.
Section 5. Determination of Right of Indemnification.
Any indemnification under Sections 2 or 3 of this Article
(unless ordered by a court) shall be made by the Corporation only as
authorized in the specific case upon a determination that indemnification
of the agent is proper in the circumstances because the agent has met the
applicable standard of conduct as set forth in Sections 2 or 3 of this
Article. Such determination shall be made (i) by the Board of Directors by
a majority vote of a quorum consisting of Directors who are not parties to
such proceeding, (ii) if such a quorum is not obtainable, or even if
obtainable, a quorum of disinterested Directors so directs, by independent
legal counsel in a written opinion or (iii) by the Stockholders.
Section 6. Advances of Expenses.
Expenses incurred by an officer or Director in defending a
proceeding may be paid by the Corporation in advance of the final
disposition of such proceeding as
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<PAGE> 19
authorized by the Board of Directors in the specific case upon receipt of
an undertaking by or on behalf of such Director or officer to repay such
amount unless it shall ultimately be determined that he is entitled to be
indemnified by the Corporation as authorized in this Article. Such
expenses incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the Board of Directors deems appropriate.
Section 7. Other Rights and Remedies.
The indemnification provided by this Article shall not be
deemed exclusive of any other rights to which one seeking indemnification
may be entitled under any Bylaw, agreement, vote of Stockholders or
disinterested directors, or otherwise.
Section 8. Insurance.
The Corporation may purchase and maintain insurance on behalf
of any person who is or was a Director, officer, employee or agent of the
Corporation, or is or was serving at the request of, or to represent the
interests of, the Corporation as a subsidiary officer of any affiliated
entity, against any liability asserted against such person in any such
capacity, or arising out of such person's status as such, whether or not
the Corporation would have the power to indemnify such person against such
liability under the provisions of this Article or applicable law.
ARTICLE VI
RECORDS AND REPORTS
Section 1. Maintenance and Inspection of Share Register.
The Secretary of the Corporation shall prepare and make, or
cause to be made, at least ten (10) days before every meeting of
Stockholders, a complete list of the Stockholders entitled to vote at the
meeting, 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 (10) days prior to the
meeting, either at a place within the city 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 willful neglect or refusal of the Directors to produce such a list at
any meeting for the
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<PAGE> 20
election of Directors, shall make such Directors ineligible for election to
any office at such meeting.
The stock ledger shall be the only evidence as to who are the
Stockholders entitled to examine the stock ledger, the list of Stockholders
required under this Section 1 or the books of the Corporation, or to vote
in person or by proxy at any meeting of Stockholders.
Any Stockholder, in person or by attorney or other agent,
shall, upon five (5) days written demand under oath stating the purpose
thereof, have the right during the usual hours for business to inspect for
any proper purpose the Corporation's stock ledger, a list of its
Stockholders, and its other books and records, and to make copies or
extracts therefrom. A proper purpose shall mean a purpose reasonably
related to such person's interests as a Stockholder. In every instance
where an attorney or other agent shall be the person who seeks the right to
inspection, the demand under oath shall be accompanied by a power of
attorney or such other writing which authorizes the attorney or other agent
to so act on behalf of the Stockholder. The demand under oath shall be
directed to the Corporation at its registered office in this State or at
its principal place of business.
If the Corporation or an officer or agent thereof refuses to
permit an inspection sought by a Stockholder or attorney or other agent
acting for the Stockholder pursuant to this Section 1 or does not reply to
the demand within five (5) business days after the demand has been made,
the Stockholder may apply to the Court of Chancery for an order to compel
such inspection.
Any Director shall have the right to examine the Corporation's
stock ledger, a list of its Stockholders and its other books and records
for a purpose reasonably related to his position as a Director. The Court
of Chancery is hereby vested with the exclusive jurisdiction to determine
whether a Director is entitled to the inspection sought.
Section 2. Maintenance and Inspection of Bylaws.
The Corporation shall keep at its principal executive office,
or if its principal executive office is not in this State at its principal
business office in this State, the original or a copy of the Bylaws as
amended to date, which shall be open to inspection by the Stockholders at
all reasonable times during office hours. If the principal executive
office of the Corporation is outside this State and the Corporation has no
principal business office in this State, the Secretary shall, upon the
written request of any
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<PAGE> 21
Stockholder, furnish to such Stockholder a copy of the Bylaws as amended to
date.
Section 3. Maintenance and Inspection of Other Corporate
Records.
The minutes of proceedings of the Stockholders and the Board of
Directors and any committee or committees of the Board of Directors shall
be kept at such place or places designated by the Board of Directors, or,
in the absence of such designation, at the principal executive office of
the Corporation. The minutes shall be kept in written form. Such minutes
shall be open to inspection upon the written demand of any Stockholder or
holder of a voting trust certificate at any reasonable time during usual
business hours for a purpose reasonably related to such holder's interests
as a Stockholder or as the holder of a voting trust certificate. Such
inspection may be made in person or by an agent or attorney and shall
include the right to copy and make extracts.
Every Director shall have the absolute right at any reasonable
time to inspect and copy all books, records and documents of every kind and
to inspect the physical properties of this Corporation and any subsidiary
of this Corporation. Such inspection by a Director may be made in person
or by agent or attorney and the right of inspection includes the right to
copy and make extracts.
The foregoing rights of inspection shall extend to the records
of each subsidiary of the Corporation.
Section 4. Annual Report to Stockholders.
The Board of Directors shall cause an annual report to be sent
to the Stockholders not later than one hundred twenty (120) days after the
close of the fiscal year adopted by the Corporation. Such report shall be
sent at least ten (10) days prior to the annual meeting of Stockholders to
be held during the next fiscal year and in the manner specified in
Section 4 of Article II of these Bylaws for giving notice to Stockholders
of the Corporation. The annual report shall contain a balance sheet as of
the end of such fiscal year and an income statement and statement of
changes in financial position of such fiscal year, accompanied by a report
thereon of independent accountants or, if there is no such report, the
certificate of an authorized officer of the Corporation that such
statements were prepared without audit from the books and records of the
Corporation.
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<PAGE> 22
ARTICLE VII
DIVIDENDS AND RESERVES
Subject always to the provisions of law and the Certificate of
Incorporation, the Board of Directors shall have full power to determine
whether any and, if any, what part of any funds legally available for the
payment of dividends shall be declared as dividends and paid to the
Stockholders; the division of the whole or any part of such funds of the
Corporation shall rest wholly within the lawful discretion of the Board of
Directors, and it shall not be required at any time, against such
discretion, to divide or pay any part of such funds among or to the
Stockholders as dividends or otherwise, and before payment of any dividend,
there may be set aside out of any funds of the Corporation available for
dividends such sum or sums as the Board of Directors from time to time, in
its absolute discretion, thinks proper as a reserve or reserves to meet
contingencies, or for equalizing dividends, or for repairing or maintaining
any property of the Corporation, or for such other purpose as the Board of
Directors shall think conducive to the interests of the Corporation, and
the Board of Directors may modify or abolish any such reserve in the manner
in which it was created.
ARTICLE VIII
GENERAL CORPORATE MATTERS
Section 1. Record Date.
For purposes of determining the Stockholders entitled to notice
of or to vote at any meeting of Stockholders or any adjournment thereof, or
entitled to receive payment of any dividends or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of
any change, conversion or exchange of stock or for the purpose of any
lawful action, the Board of Directors may fix, in advance, a record date,
which shall not be more than sixty (60) nor less than ten (10) days prior
to the date of any such meeting, nor more than sixty (60) days prior to any
other action. A determination of the Stockholders of record entitled to
notice of or to vote at a meeting of the Stockholders shall apply to any
adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjournment meeting.
If the Board of Directors does not so fix a record date; then
(1) The record date for determining the Stockholders entitled
to notice of or to vote at a meeting of
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<PAGE> 23
the Stockholders shall be at the close of business on the date 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.
(2) The record date for determining the 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.
Section 2. Checks, Drafts and Evidences of Indebtedness.
All checks, drafts or other orders for payment of money, notes
or other evidence of indebtedness, issued in the name of or payable to the
Corporation shall be signed or endorsed by such person or persons and in
such manner as, from time to time, shall be determined by resolution of the
Board of Directors.
Section 3. Corporate Contracts and Instruments: Manner of
Execution.
The Board of Directors, except as otherwise provided in the
Bylaws, may authorize any officer or officers or agent or agents, to enter
into any contract or execute any instrument in the name of and on behalf of
the Corporation, and such authority may be general or confined to specific
instances; and, unless so authorized or ratified by the Board of Directors
or within the agency power of an officer, no officer, agent or employee
shall have any power or authority to bind the Corporation by any contract
or engagement or to pledge its credit or to render it liable for any
purpose or to any amount.
Section 4. Stock Certificates.
Every holder of stock of the Corporation shall be entitled to
have a certificate signed by or in the name of the Corporation by the
Chairman or Vice Chairman of the Board of Directors, if any, or the Presi-
dent or any Vice President, and by the Treasurer or any Assistant
Treasurer, or the Secretary or any Assistant Secretary, of the Corporation
certifying the number of shares of stock in the Corporation owned by such
holder in the Corporation. Any or all of the signatures on the certificate
may be a facsimile. In case that any officer, transfer agent or registrar
who has signed or whose facsimile signature has been placed upon a certifi-
cate 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 such person were such officer, transfer agent or
registrar at the date of issue. The Corporation may issue the whole or any
part of its shares as partly paid and subject to call for the remainder of
the consideration to be paid therefor. Upon the face or back of
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<PAGE> 24
each stock certificate issued to represent any such partly paid shares, the
total amount of the consideration to be paid therefor and the amount paid
thereon shall be stated. Upon the declaration of any dividend on fully
paid shares, the Corporation shall declare a dividend upon partly paid
shares of the same class, but only upon the basis of the percentage of the
consideration actually paid thereon.
Any stock certificate shall also contain such legend or other
statement as may be required by law or by any agreement between the
Corporation and the issuee thereof.
Section 5. Lost Certificates.
No new certificate for shares shall be issued in place of any
certificate theretofore issued unless the latter is surrendered and
cancelled at the same time; provided, however, that a new certificate may
be issued without the surrender and cancellation of the old certificate if
the certificate theretofore issued is alleged to have been lost, stolen or
destroyed. In case of any such allegedly lost, stolen or destroyed
certificate, the Corporation may require the owner thereof or the legal
representative of such owner to give the Corporation a bond sufficient to
indemnify it against any claim that may be made against it (including any
expense or liability) on account of the alleged loss, theft or destruction
of any such certificate or the issuance of such new certificate.
Section 6. Representation of Shares of Other Corporations.
The Chairman of the Board of Directors, the President, the
Secretary or any Vice President or any person authorized by resolution of
the Board of Directors or by any of the foregoing designated officers, is
authorized to vote on behalf of the Corporation any and all shares of any
other corporation or corporations, foreign or domestic, standing in the
name of the Corporation. The authority herein granted to said officers to
vote or represent on behalf of the Corporation any and all shares held by
the Corporation in any other corporation or corporations may be exercised
by any such officer in person or by any person authorized to do so by a
proxy duly executed by said officer.
Section 7. Construction and Definitions.
Unless the context requires otherwise, the general provisions,
rules of construction and definitions in the Delaware General Corporation
Law shall govern the construction of these Bylaws. Without limiting the
generality of the foregoing, the singular number includes the plural, the
plural includes the singular and the term "person" includes both a
corporation and a natural person.
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<PAGE> 25
Section 8. Seal.
The Corporation's seal shall be in such form as is required by
law and shall be approved by the Board of Directors.
Section 9. Fiscal Year.
The fiscal year of the Corporation shall be determined by the
Board of Directors.
ARTICLE IX
AMENDMENTS
Section 1. Amendment by Stockholders.
Subject to the provisions of the Certificate of Incorporation,
these Bylaws may be altered, amended or repealed at any regular meeting of
the Stockholders (or at a special meeting duly called for that purpose) by
the approval of not less than a majority of all shares of the Corporation
entitled to vote in the election of Directors considered for the purposes
of this Article IX as voting as one class; provided, however, that in the
notice of such special meeting, notice of such purpose shall be given.
Section 2. Amendment by Directors.
Subject to the laws of the State of Delaware, the Certificate
of Incorporation and these Bylaws, the Board of Directors may by the
majority vote of those Directors present at any meeting of the Board of
Directors at which a quorum is present amend these Bylaws or enact such
other Bylaws as in their judgment may be advisable for the regulation of
the conduct of the affairs of the Corporation.
<PAGE> 1
EXHIBIT 4.3
CERTIFICATE OF DESIGNATIONS
OF
SERIES A PREFERRED STOCK
OF
STANDARD BRANDS PAINT COMPANY
Pursuant to Section 151 of the General
Corporation Law of the State of Delaware
We, the undersigned duly authorized officers of Standard Brands
Paint Company, a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), in accordance
with the provisions of Section 103 thereof, and pursuant to Section 151
thereof, do hereby certify:
That pursuant to the authority conferred upon the Board of
Directors by the Certificate of Incorporation of the Corporation, the Board
of Directors of the Corporation on February 8, 1995 approved the creation
of the following series of Preferred Stock and adopted the following
resolution creating a series of 1,570,049 shares of Preferred Stock, no par
value per share, each designated as set forth below:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of the Corporation in accordance with the provisions of its
Certificate of Incorporation, a series of the class designated as the
Preferred Stock (the "Preferred Stock") of the Corporation be and it hereby
is created, and that the designation and amount thereof and the preferences
and relative, optional and other special rights of the shares of such
series, and the qualifications, limitations or restrictions thereof, are as
follows:
(i) The distinctive serial designation of this series shall be
"8% Series A Cumulative Convertible Mandatory Redeemable Preferred Stock"
(hereinafter called the "Series A Preferred Stock"). Each share of Series
A Preferred Stock shall be identical in all respects with the other shares
of Series A Preferred Stock except as to the dates from and after which
dividends thereon shall be cumulative.
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<PAGE> 2
(ii) The number of shares of Series A Preferred Stock shall
initially be 1,570,049, which number may from time to time be increased or
decreased (but not below the number then outstanding) by the Board of
Directors. Shares of Series A Preferred Stock redeemed, purchased by the
Corporation or converted into Common Stock shall be canceled and shall
revert to authorized but unissued Preferred Stock undesignated as to
series.
(iii) The holders of shares of Series A Preferred Stock shall be
entitled to receive, when and as declared by the Board of Directors, but
only out of funds legally available therefor, cumulative cash dividends at
the annual rate of $0.71 per share, and no more, payable quarterly on the
first days of January, April, July and October, respectively, in each year
with respect to the quarterly dividend period (or portion thereof) ending
on the day preceding such respective dividend payment date, to stockholders
of record on the respective date, not exceeding fifty days preceding such
dividend payment date, fixed for the purpose by the Board of Directors in
advance of payment of each particular dividend. However, the initial
dividend on the Series A Preferred Stock shall be payable on the first such
quarterly dividend payment date following after the Commencement Date (as
hereinafter defined), and not earlier.
(iv) Dividends on the shares of Series A Preferred Stock shall
be cumulative from the date (the "Commencement Date") that is 18 months
after the original issuance date of such shares (the "Issuance Date").
So long as any share of Series A Preferred Stock remains
outstanding, no dividend whatever shall be paid or declared and no
distribution made on any junior stock other than a dividend payable in
junior stock, and no shares of junior stock shall be purchased, redeemed or
otherwise acquired for consideration by the Corporation, directly or
indirectly (other than as a result of a reclassification of junior stock,
or the exchange or conversion of one junior stock for or into another
junior stock, or other than through the use of the proceeds of a
substantially contemporaneous sale of other junior stock), unless all
dividends on the Series A Preferred Stock accrued for all past
quarter-yearly dividend periods since the Commencement Date shall have been
paid and the full dividend thereon for the then current quarter-yearly
dividend period shall have been paid or declared and set apart for payment.
Subject to the foregoing, and not otherwise, such dividends (payable in
cash, stock or otherwise) as may be determined by the Board of Directors
may be declared and paid on any junior stock
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<PAGE> 3
from time to time out of any funds legally available therefor, and the
Series A Preferred Stock shall not be entitled to participate in any such
dividends, whether payable in cash, stock or otherwise.
(v) In the event of any voluntary liquidation, dissolution or
winding up of the affairs of the Corporation, the holders of shares of
Series A Preferred Stock shall be entitled, before any distribution or
payment is made to the holders of any junior stock, to be paid in full the
redemption price in effect at the time of such distribution or payment date
as provided in subparagraph (vi) hereof, together with accrued dividends to
such distribution or payment date whether or not earned or declared. In
the event of any involuntary liquidation, dissolution or winding up of the
affairs of the Corporation, then, before any distribution or payment shall
be made to the holders of any junior stock, the holders of shares of Series
A Preferred Stock shall be entitled to be paid in full an amount equal to
$8.92 per share (which amount is hereinafter referred to as the
"involuntary liquidation amount"), together with accrued dividends to such
distribution or payment date whether or not earned or declared.
If such payment shall have been made in full to all holders of
shares of Series A Preferred Stock, the remaining assets of the Corporation
shall be distributed among the holders of junior stock, according to their
respective rights and preferences and in each case according to their
respective numbers of shares. For the purposes of this subparagraph (v),
the consolidation or merger of the Corporation with any other corporation
shall not be deemed to constitute a liquidation, dissolution or winding up
of the Corporation.
(vi) Corimon, S.A.C.A., a Venezuelan corporation (or any
affiliate of Corimon, S.A.C.A. designated by it), or the Corporation, at
the option of the Board of Directors, may purchase or redeem up to 785,025
of the shares of Series A Preferred Stock at the time outstanding, at any
time or from time to time, upon notice given as hereinafter specified, at
the redemption price in effect at the redemption date as provided in this
subparagraph (vi), together with accrued dividends to the redemption date.
For this purpose only, dividends are deemed to have been cumulative from
the Issuance Date. The redemption price for shares of Series A Preferred
Stock shall be $6.69 per share for the period from the Issuance Date to the
first anniversary thereof, $7.14 per share thereafter to the second
anniversary of the Issuance Date, $7.60 per share thereafter for the next
six-monthly period, $8.03 per share thereafter for the next six-
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<PAGE> 4
monthly period, $8.47 for the next six-monthly period and $8.92 per share
thereafter.
The Corporation will redeem the whole of the shares of Series A
Preferred Stock at the time outstanding, at the tenth anniversary of the
Issuance Date, at the mandatory redemption price in effect at the mandatory
redemption date as provided in this subparagraph (vi), together with
accrued dividends to the redemption date. The mandatory redemption price
for shares of Series A Preferred Stock shall be $8.92 per share.
Notice of every redemption of shares of Series A Preferred
Stock shall be mailed by first class mail, postage prepaid, addressed to
the holders of record of the shares to be redeemed at their respective last
addresses as they shall appear on the books of the Corporation. Such
mailing shall be at least 30 days and not more than 60 days prior to the
date fixed for redemption. Any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given, whether or
not the stockholder receives such notice, and failure duly to give such
notice by mail, or any defect in such notice, to any holder of shares of
Series A Preferred Stock designated for redemption shall not affect the
validity of the proceedings for the redemption of any other shares of
Series A Preferred Stock.
In case of redemption of a part only of the shares of Series A
Preferred Stock at the time outstanding the redemption will be pro rata.
The Board of Directors shall have full power and authority, subject to the
provisions herein contained, to prescribe the terms and conditions upon
which shares of the Series A Preferred Stock shall be redeemed from time to
time.
If notice of redemption shall have been duly given, and if, on
or before the redemption date specified therein, all funds necessary for
such redemption shall have been set aside by the Corporation, separate and
apart from its other funds, in trust for the pro rata benefit of the
holders of the shares called for redemption, so as to be and continue to be
available therefor, then, notwithstanding that any certificate for shares
so called for redemption shall not have been surrendered for cancellation,
all shares so called for redemption shall no longer be deemed outstanding
on and after such redemption date, and all rights with respect to such
shares shall forthwith on such redemption date cease and terminate, except
only the right of the holders thereof to receive the amount payable on
redemption thereof, without interest.
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<PAGE> 5
If such notice of redemption shall have been duly given or if
the Corporation shall have given to the bank or trust company hereinafter
referred to irrevocable authorization promptly to give such notice, and if
on or before the redemption date specified therein the funds necessary for
such redemption shall have been deposited by the Corporation with such bank
or trust company in trust for the pro rata benefit of the holders of the
shares called for redemption, then, notwithstanding that any certificate
for shares so called for redemption shall not have been surrendered for
cancellation, from and after the time of such deposit, all shares so called
for redemption shall no longer be deemed to be outstanding and all rights
with respect to such shares shall forthwith cease and terminate, except
only the right of the holders thereof to receive from such bank or trust
company at any time after the time of such deposit the funds so deposited,
without interest, and the right to exercise, on or before the date fixed
for redemption, privileges of exchange or conversion, if any, not
theretofore expiring. The aforesaid bank or trust company shall be
organized and in good standing under the laws of the United States of
America or of the State of New York, shall be doing business in the Borough
of Manhattan, The City of New York, shall have capital, surplus and
undivided profits aggregating at least $10,000,000 according to its last
published statement of condition, and shall be identified in the notice of
redemption. Any interest accrued on such funds shall be paid to
Corporation from time to time.
Any funds so set aside or deposited by the Corporation which
shall not be required for such redemption because of the exercise of any
right of conversion subsequent to the date of such deposit shall be
released or repaid to the Corporation forthwith. Any funds so set aside or
deposited, as the case may be, and unclaimed at the end of three years from
such redemption date shall, to the extent permitted by law, be released or
repaid to the Corporation, after which repayment the holders of the shares
so called for redemption shall look only to the Corporation for payment
thereof.
(vii) The holders of shares of Series A Preferred Stock shall
have the right, at their option, to convert such shares into Common Stock
of the Corporation at any time after the Commencement Date, and prior to
such date if and only if a Conversion Event occurs, on and subject to the
following terms and conditions:
<PAGE>
<PAGE> 6
(a) The shares of Series A Preferred Stock shall be
convertible at the principal office of the Corporation, and at such
other office or offices, if any, as the Board of Directors may
designate, into fully paid and non-assessable shares (calculated as
to each conversion to the nearest 1/100th of a share) of Common Stock
of the Corporation, at the conversion price, determined as
hereinafter provided, in effect at the time of conversion, each share
of Series A Preferred Stock being taken at $8.92 for the purpose of
such conversion. The price at which Common Stock shall be delivered
upon conversion (herein called the "conversion price") shall
initially be $1.11 per share of Common Stock.
(b) In order to convert shares of Series A Preferred Stock
into Common Stock the holder thereof shall surrender at the office
hereinabove mentioned the certificate or certificates therefor, duly
endorsed or assigned to the Corporation or in blank, and give written
notice to the Corporation at said office that he elects to convert
such shares. Upon conversion no allowance or adjustment shall be
made for dividends on either class of stock.
Shares of Series A Preferred Stock shall be deemed to have been
converted immediately prior to the close of business on the day of
the surrender of such shares for conversion in accordance with the
foregoing provisions, and the person or persons entitled to receive
the Common Stock issuable upon such conversions shall be treated for
all purposes as the record holder or holders of such Common Stock at
such time. As promptly as practicable on or after the conversion
date, the Corporation shall issue and shall deliver at said office
(or by mail if so requested by the person converting), a certificate
or certificates for the number of full shares of Common Stock
issuable upon such conversion, together with payment in lieu of any
fraction of a share, as hereinafter provided, to the person or
persons entitled to receive the same. In case shares of Series A
Preferred Stock are called for redemption, the right to convert such
shares shall cease and terminate at the close of business on the date
fixed for redemption, unless default shall be made in payment of the
redemption price.
(c) No fractional share of Common Stock shall be issued upon
conversion of shares of Series A Preferred Stock, but, instead of any
fraction which would otherwise be issuable in respect of the
aggregate
<PAGE>
<PAGE> 7
number of shares of Series A Preferred Stock surrendered for
conversion at one time by the same holder, the Corporation shall pay
a cash adjustment in an amount equal to the same fraction of the
Closing Price (as hereinafter defined) on the date on which the
certificate or certificates for such shares were duly surrendered for
conversion, or, if such date is not a Trading Day (as hereinafter
defined), on the next Trading Day.
(d) The conversion price shall be adjusted from time to time
as follows:
(A) In case the Corporation shall (i) pay a dividend or
make a distribution on its outstanding shares of Common Stock
in shares of its capital stock, (ii) subdivide its outstanding
shares of Common Stock, (iii) combine its outstanding shares of
Common Stock into a smaller number of shares of Common Stock,
or (iv) issue by reclassification of its shares of Common Stock
(whether pursuant to a merger or consolidation or otherwise)
any other shares of the Corporation, the holder of any shares
of Series A Preferred Stock surrendered for conversion after
the record date for such dividend or distribution (which for
this purpose shall be at the close of business on the date
fixed by the Board of Directors as the record date), or after
the close of business on the effective date of such
subdivision, combination or reclassification, as the case may
be (the close of business times being hereinafter in this
clause (A) referred to as "such record date"), shall be
entitled to receive the aggregate number and kind of shares of
capital stock of the Corporation which, if such shares of
Series A Preferred Stock had been converted immediately prior
to such record date at the conversion price then in effect, he
would have been entitled to receive by virtue of such dividend,
distribution, subdivision, combination or reclassification; and
the conversion price shall be deemed to have been adjusted
after such record date to apply to such aggregate number and
kind of shares. Such adjustment shall be made whenever any of
the events listed above shall occur.
(B) In case the Corporation shall fix a record date for
issuing to all holders of shares of Common Stock rights or
warrants entitling them to subscribe for or purchase shares of
Common
<PAGE>
<PAGE> 8
Stock at a price per share less than the current market price
per share (as determined pursuant to clause (D) below) on such
record date, the conversion price in effect from and after such
record date shall be adjusted so that it shall be equal to the
price determined by multiplying the conversion price in effect
immediately prior to such record date by a fraction, of which
the numerator shall be the number of shares of Common Stock
outstanding on such record date plus the number of shares of
Common Stock which the aggregate offering price of the total
number of shares of Common Stock so offered for subscription or
purchase would purchase at such current market price and of
which the denominator shall be the number of shares of Common
Stock outstanding on such record date plus the number of
additional shares of Common Stock so offered for subscription
or purchase. For the purpose of this clause (B), the issuance
of rights or warrants to subscribe for or purchase securities
convertible into shares of Common Stock shall be deemed to be
the issuance of rights or warrants to purchase the shares of
Common Stock into which such securities are convertible at an
aggregate offering price equal to the aggregate offering price
of such securities plus the minimum aggregate amount (if any)
payable upon conversion of such securities into shares of
Common Stock. Such adjustment shall be made successively
whenever such a record date is fixed. In the event that such
rights or warrants are not issued after such a record date has
been fixed, the conversion price shall be retroactively
adjusted to the conversion price which would have been in
effect if such record date had not been fixed.
(C) In case the Corporation shall fix a record date for
the distribution to all holders of shares of Common Stock
(whether pursuant to a merger or consolidation or otherwise) of
evidence of its indebtedness or assets (excluding cash
dividends), or rights to subscribe (excluding those referred to
in clause (B) above), then in each such case the conversion
price in effect from and after such record date shall be
adjusted so that the same shall be equal to the price
determined by multiplying the conversion price in effect
immediately prior to such record date by a fraction, of which
the numerator shall be the current market price per share
(determined as
<PAGE>
<PAGE> 9
provided in clause (D) below) of the shares of Common Stock on
such record date less the fair market value (as determined by a
resolution of the Board of Directors of the Corporation filed
with the transfer agent for the Series A Preferred Stock, which
determination shall be conclusive) of the portion of the
evidences of indebtedness or assets so distributed or of such
rights to subscribe applicable to one share of Common Stock and
of which the denominator shall be such current market price per
share of Common Stock. Such adjustment shall be made whenever
any such record date is fixed. In the event that such
distribution is not made after such a record date has been
fixed, the conversion price shall be retroactively adjusted to
the conversion price which would have been in effect if such
record date had not been fixed.
(D) For the purpose of any computation under clauses
(B) and (C) above, the current market price per share of Common
Stock on any date shall be deemed to be the average of the
daily Closing Prices for 30 consecutive Trading Days selected
by the Corporation commencing not more than 45 Trading Days
before the date in question.
(E) In any case in which this subdivision (d) shall
require that an adjustment as a result of any event become
effective from and after a record date, the Corporation may
elect to defer until after the occurrence of such event
(i) issuing to the holder of any shares of Series A Preferred
Stock converted after such record date and before the
occurrence of such event the additional shares of Common Stock
issuable upon such conversion over and above the shares
issuable on the basis of the conversion price in effect
immediately prior to adjustment and (ii) paying to such holder
any amount in cash in lieu of a fractional share of Common
Stock pursuant to subdivision (c) above. In lieu of the shares
the issuance of which is deferred pursuant to item (i) above,
the Corporation shall issue or cause one of its transfer agents
to issue due bills or other appropriate evidence of the right
to receive such shares.
(F) Any adjustment in the conversion price otherwise
required by this subparagraph (vii) to be made may be postponed
if such adjustment (plus
<PAGE>
<PAGE> 10
any other adjustments postponed pursuant to this clause (F) and
not theretofore made) would not require an increase or decrease
of more than 1% in such price. All calculations under this
subdivision (d) shall be made to the nearest cent or to the
nearest 1/100 of a share, as the case may be.
(G) The Board of Directors may make such adjustments in
the conversion price, in addition to those required by this
subdivision (d) as shall be determined by the Board, as
evidenced by a Board resolution, to be advisable in order to
avoid taxation so far as practicable of any dividend of stock
or stock rights or any event treated as such for Federal income
tax purposes to the recipients. The Board shall have the power
to resolve any ambiguity or correct any error in this
subdivision (d) and its action in so doing, as evidenced by a
Board resolution, shall be final and conclusive.
(H) In the event that at any time, as a result of an
adjustment made pursuant to clause (A) above, the holder of any
shares of Series A Preferred Stock thereafter surrendered for
conversion shall become entitled to receive any shares of
capital stock of the Corporation other than shares of Common
Stock, thereafter the number of such other shares so receivable
upon conversion of such shares of Series A Preferred Stock
shall be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the
provisions with respect to the shares of Common Stock contained
in clauses (A) to (G), inclusive, above, and the other
provisions of this subdivision (d) with respect to the shares
of Common Stock shall apply on like terms to any such other
shares.
(e) Whenever the conversion price is adjusted as herein
provided:
(A) The Corporation shall compute the adjusted
conversion price and shall cause to be prepared a certificate
signed by the Corporation's treasurer setting forth the
adjusted conversion price and a brief statement of the facts
requiring such adjustment and the computation thereof; such
certificate shall forthwith be filed with the
<PAGE>
<PAGE> 11
transfer agent for the Series A Preferred Stock; and
(B) A notice stating that the conversion price has been
adjusted and setting forth the adjusted conversion price shall,
as soon as practicable, be mailed to the holders of record of
outstanding shares of the Series A Preferred Stock.
(f) In case:
(A) The Corporation shall declare a dividend or other
distribution on its shares of Common Stock, other than in cash;
(B) The Corporation shall authorize the issuance to all
holders of its shares of Common Stock of rights or warrants
entitling them to subscribe for or purchase any shares of
Common Stock or any other subscription rights or warrants; or
(C) Of any reclassification of the capital stock of the
Corporation (other than a subdivision or combination of its
outstanding shares of Common Stock), or of any consolidation or
merger to which the Corporation is a party and for which
approval of any stockholders of the Corporation is required, or
of the sale, lease, exchange or other disposition of all or
substantially all the property and assets of the Corporation;
or
(D) Of the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation;
then the Corporation shall cause to be mailed to the transfer agent
for the Series A Preferred Stock and to the holders of record of the
outstanding shares of Series A Preferred Stock, at least 20 days (or
10 days in any case specified in clause (A) or (B) above) prior to
the applicable record or effective date hereinafter specified, a
notice stating (x) the date as of which the holders of record of
shares of Common Stock to be entitled to such dividend, distribution,
rights or warrants are to be determined, or (y) the date on which
such reclassification, consolidation, merger, sale, lease, exchange,
disposition, liquidation, dissolution or winding up is expected to
become effective, and the date as of which it is expected that
holders of record
<PAGE>
<PAGE> 12
of shares of Common Stock shall be entitled to exchange their shares
for securities or other property, if any, deliverable upon such
reclassification, consolidation, merger, sale, lease, exchange,
disposition, liquidation, dissolution or winding up. The failure to
give the notice required by this subdivision (f), or any defect
therein, shall not affect the legality or validity of any such
dividend, distribution, right, warrant, reclassification,
consolidation, merger, sale, lease, exchange, disposition,
liquidation, dissolution or winding up, or the vote on any action
authorizing such.
(g) The Corporation shall at all times reserve and keep
available, free from preemptive rights, out of its authorized but
unissued shares of Common Stock, for the purpose of issuance upon
conversion of the Series A Preferred Stock, the full number of shares
of Common Stock then deliverable upon the conversion of all shares of
Series A Preferred Stock then outstanding.
(h) The Corporation will pay any and all taxes that may be
payable in respect of the issuance or delivery of shares of Common
Stock on conversion of shares of Series A Preferred Stock. The
Corporation shall not, however, be required to pay any tax which may
be payable in respect of any transfer involved in the issuance and
delivery of shares of Common Stock in a name other than that in which
the shares of Series A Preferred Stock so converted were registered,
and no such issuance or delivery shall be made unless and until the
person requesting such issuance has paid to the Corporation the
amount of any such tax or has established to the satisfaction of the
Corporation that such tax has been paid.
(i) For the purpose of this subparagraph (vii), the term
"shares of Common Stock" shall include any shares of the Corporation
of any class or series which has no preference or priority in the
payment of dividends or in the distribution of assets upon any
voluntary or involuntary liquidation, dissolution or winding up of
the Corporation and which is not subject to redemption by the
Corporation. However, shares of Common Stock issuable upon
conversion of shares of Series A Preferred Stock shall include only
shares of the class designated as shares of Common Stock as of the
original date of issuance of the shares of Series A Preferred Stock,
or shares of the Corporation of any classes or series resulting from
any reclassification or reclassifications thereof and which have no
<PAGE>
<PAGE> 13
preference or priority in the payment of dividends or in the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation and which are not
subject to redemption by the Corporation, provided that if at any
time there shall be more than one such resulting class or series, the
shares of each such class and series then so issuable shall be
substantially in the proportion which the total number of shares of
such class and series resulting from all such reclassifications bears
to the total number of shares of all such classes and series
resulting from all such reclassifications.
(j) As used in this subparagraph (vii), the term "Closing
Price" on any day shall mean the reported last sale price per share
of Common Stock regular way on such day or, in case no such sale
takes place on such day, the average of the reported closing bid and
asked prices regular way, in each case on the New York Stock
Exchange, or, if the shares of Common Stock are not listed or
admitted to trading on such Exchange, on the American Stock Exchange,
or, if the shares of Common Stock are not listed or admitted to
trading on such Exchange, on the principal national securities
exchange on which the shares of Common Stock are listed or admitted
to trading, or, if the shares of Common Stock are not listed or
admitted to trading on any national securities exchange, the average
of the closing bid and asked prices in the over-the-counter market as
reported by the National Association of Securities Dealers' Automated
Quotation System, or, if not so reported, as reported by the National
Quotation Bureau, Incorporated, or any successor thereof, or, if not
so reported, the average of the closing bid and asked prices as
furnished by any member of the National Association of Securities
Dealers, Inc. selected from time to time by the Corporation for that
purpose; and the term "Trading Day" shall mean a day on which the
principal national securities exchange on which the shares of Common
Stock are listed or admitted to trading is open for the transaction
of business or, if the shares of Common Stock are not listed or
admitted to trading on any national securities exchange, a Monday,
Tuesday, Wednesday, Thursday or Friday on which banking institutions
in the Borough of Manhattan, City and State of New York are not
authorized or obligated by law or executive order to close.
<PAGE>
<PAGE> 14
(k) As used in this subparagraph (vii), the term "Conversion
Event" shall mean the Common Stock shall have traded at a twenty-day
average Closing Price at or above the conversion price.
(l) The certificate of any independent firm of public
accountants of recognized standing selected by the Board of Directors
shall be presumptive evidence of the correctness of any computation
made under this subparagraph (vii).
(m) Notwithstanding anything contained in this subparagraph
(vii), the Corporation shall have the option, in lieu of delivering
shares of Common Stock of the Corporation upon conversion, of paying
to such holder a cash amount equal to the current market price per
share of Common Stock, as determined under clause (vii)(d)(D) above,
of the number of shares of Common Stock issuable upon such
conversion.
(viii) The holders of Series A Preferred Stock shall be entitled
to no voting rights, except as hereinafter provided.
Commencing after the Commencement Date, if and whenever six
quarterly dividends payable on any shares of Series A Preferred Stock shall
be in arrears in whole or in part whether or not earned or declared, the
number of directors then constituting the Board of Directors shall be
increased by two and the holders of shares of Series A Preferred Stock,
together with the holders of shares of every other series of Preferred
Stock similarly entitled to vote for the election of two additional
directors, voting separately as a class, regardless of series, shall be
entitled to elect the two additional directors at any annual meeting of
stockholders or special meeting held in place thereof, or at a special
meeting of the holders of such series of the Preferred Stock called as
hereinafter provided. Whenever all arrears in dividends on the shares of
Series A Preferred Stock then outstanding shall have been paid and
dividends thereon for the current quarterly dividend period shall have been
paid or declared and set apart for payment, then the right of the holders
of the shares of Series A Preferred Stock to elect such additional two
directors shall cease (but subject always to the same provisions for the
vesting of such voting rights in the case of any similar future arrearages
in dividends), and the terms of office of all persons elected as directors
by the holders of such shares of Series A Preferred Stock shall forthwith
terminate and the number of the Board of Directors shall be reduced
accordingly. At any time after such voting
<PAGE>
<PAGE> 15
power shall have been so vested in the holders of shares of Series A
Preferred Stock, the secretary of the Corporation may, and upon the written
request of any holder of shares of Series A Preferred Stock (addressed to
the secretary at the principal office of the Corporation) shall, call a
special meeting of the holders of the Series A Preferred Stock for the
election of the two directors to be elected by them as herein provided,
such call to be made by notice similar to that provided in the by-laws for
a special meeting of the stockholders or as required by law. If any such
special meeting required to be called as above provided shall not be called
by the secretary within 20 days after receipt of any such request, then any
holder of shares of Series A Preferred Stock may call such meeting, upon
the notice above provided, and for that purpose shall have access to the
stock books of the Corporation. The directors elected at any such special
meeting shall hold office until the next annual meeting of the stockholders
or special meeting held in place thereof if such office shall not have
previously terminated as above provided. In case any vacancy shall occur
among the directors elected by the holders of the shares of Series A
Preferred Stock, a successor shall be elected by the Board of Directors to
serve until the next annual meeting of the stockholders or special meeting
held in place thereof upon the nomination of the then remaining director
elected by the holders of such series or the successor of such remaining
director.
(ix) So long as any shares of Series A Preferred Stock are
outstanding, in addition to any other vote or consent of stockholders
required by law or by the certificate of incorporation, the consent of the
holders of at least 66 2/3% of the shares of Series A Preferred Stock, at
the time outstanding, acting as a single class, given in person or by
proxy, either in writing without a meeting or by vote at any meeting called
for the purpose, shall be necessary for effecting or validating:
(a) Any amendment, alteration or repeal of any of the
provisions of the certificate of incorporation, or of the by-laws, of
the Corporation, which affects adversely the voting powers, rights or
preferences of the holders of shares of the Series A Preferred Stock;
provided, however, that the amendment of the provisions of the
certificate of incorporation so as to authorize or create, or to
increase the authorized amount of, any junior stock or any shares of
any class ranking on a parity with the Series A Preferred Stock shall
not be deemed to affect adversely the voting powers, rights or
preferences of the holders of shares of the Series A Preferred Stock.
<PAGE>
<PAGE> 16
(b) The authorization or creation of, or the increase in the
authorized amount of, any shares of any class or any security
convertible into shares of any class ranking prior to the Series A
Preferred Stock in the distribution of assets on any liquidation,
dissolution or winding up of the Corporation or in the payment of
dividends; or
(c) The merger or consolidation of the Corporation with or
into any other corporation, unless the resulting corporation will
thereafter have no class of shares and no other securities either
authorized or outstanding ranking prior to Series A Preferred Stock
in the distribution of its assets on liquidation, dissolution or
winding up or in the payment of dividends, except the same number of
shares and the same amount of other securities with the same rights
and preferences as the shares and securities of the Corporation
respectively authorized and outstanding immediately preceding such
merger or consolidation, and each holder of shares of Series A
Preferred Stock immediately preceding such merger or consolidation
shall receive the same number of shares, with the same rights and
preferences, of the resulting corporation;
provided, however, that no such consent of the holders of Series A
Preferred Stock shall be required if, at or prior to the time when such
amendment, alteration or repeal is to take effect or when the issuance of
any such prior shares or convertible security is to be made, or when such
consolidation or merger, purchase or redemption is to take effect, as the
case may be, provision is made for the redemption of all shares of Series A
Preferred Stock at the time outstanding.
(x) So long as any shares of Series A Preferred Stock are
outstanding, in addition to any other vote or consent of stockholders
required by law or by the certificate of incorporation, the consent of the
holders of at least a majority of the shares of Series A Preferred Stock,
at the time outstanding, acting as a single class, given in person or by
proxy, either in writing without a meeting or by vote at any meeting called
for the purpose, shall be necessary for effecting or validating any
increase in the authorized amount of the Series A Preferred Stock, or the
authorization or creation of, or the increase in the authorized amount of,
any shares of any class or any security convertible into shares of any
class, ranking on a parity with the Series A Preferred Stock in the
distribution of assets on any liquidation, dissolution, or winding up of
the Corporation or in the payment of dividends; provided,
<PAGE>
<PAGE> 17
however, that no such consent shall be required if, at or prior to the time
such increase, authorization, or creation of parity shares is to be made,
provision is made for the redemption of all shares of Series A Preferred
Stock at the time outstanding.
(xi) As used herein with respect to Series A Preferred Stock,
the following terms shall have the following meanings:
(a) The term "junior stock" shall mean the Common Stock and
any other class or series of shares of the Corporation hereafter
authorized over which Series A Preferred Stock has preference or
priority in the payment of dividends or in the distribution of assets
on any liquidation, dissolution or winding up of the Corporation.
(b) The term "accrued dividends", with respect to any share
of any class or series, shall mean an amount computed at the annual
dividend rate for the class or series of which the particular share
is a part, from the date on which dividends on such share became
cumulative to and including the date to which such dividends are to
be accrued, less the aggregate amount of all dividends theretofore
paid thereon.
(xii) The shares of Series A Preferred Stock shall not have any
relative, participating, optional or other special rights and powers other
than as set forth herein.
IN WITNESS WHEREOF, we have signed this certificate on the 16th
day of May, 1995, and affirm the statements contained herein as true under
penalties of perjury.
\s\ HOWARD SCHWARTZ
Senior Vice President - Finance
and Chief Financial Officer
\s\ EDWARD A. DRURY
Corporate Secretary
<PAGE> 1
EXHIBIT 5.1
SULLIVAN & CROMWELL
444 South Flower Street
Los Angeles, California 90071-2901
Telephone: (213) 955-8000
Facsimile: (213) 683-0457
June 5, 1995
Standard Brands Paint Company,
4300 West 190th Street,
Torrance, California 90509.
Dear Sirs:
In connection with the registration under the Securities Act of
1933 (the "Act") of 3,392,008 shares of Common Stock, par value $.01 per
share, of Standard Brands Paint Company, a Delaware corporation (the
"Company"), 1,570,049 shares of Series A Preferred Stock, par value $.01
per share, of the Company (together with such shares of Common Stock, the
"Securities") and 12,616,970 shares of Common Stock of the Company issuable
upon conversion of the Series A Preferred Stock (the "Shares"), we, as your
counsel, have examined such corporate records, certificates and other
documents, and such questions of law, as we have considered necessary or
appropriate for the purposes of this opinion. Upon the basis of such
examination, we advise you that, in our opinion, the Securities have been
validly
<PAGE>
<PAGE> 2
issued and are fully paid and nonassessable, and the Shares, when duly
issued upon conversion of the Series A Preferred Stock, will be validly
issued, fully paid and nonassessable.
The foregoing opinion is limited to the Federal laws of the
United States and the General Corporation Law of the State of Delaware, and
we are expressing no opinion as to the effect of the laws of any other
jurisdiction.
Also, we have relied as to certain matters on information
obtained from public officials, officers of the Company and other sources
believed by us to be responsible.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the reference to us under the heading
"Validity of Offered Securities" in the Prospectus. In giving such
consent, we do not thereby admit that we are in the category of persons
whose consent is required under Section 7 of the Act.
Very truly yours,
SULLIVAN & CROMWELL
<PAGE> 1
EXHIBIT 12.1
<TABLE>
<CAPTION>
Fiscal
Fiscal Year Fiscal Year 1993 Year
Six Six
Months Months
Ended Ended
August 1, January 30,
1990 1991 1992 1993 1994 1994
(Predecessor Company) (Successor Company)
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to combined
fixed charges and preferred
stock dividend requirements. . 0.47x (0.31x) (0.05x) 0.01x (4.68x) (2.78x)
CALCULATION: (Thousands of Dollars)
Earnings:
Loss before reorganization
items, income taxes and
extraordinary items. . . . . $ (10,058) $ (26,798) $ (16,218) $ (6,992) $ (32,216) $ (47,789)
Interest expense (including
debt amortization) . . . . . 18,482 18,085 13,846 6,556 5,358 11,518
Estimated interest portion of
lease payments . . . . . . . 1,813 1,947 1,555 513 315 1,114
Total . . . . . . . . . . $ 10,237 $ (6,766) $ (817) $ 77 $ (26,543) $ (35,157)
Combined Fixed Charges and Preferred
Stock Dividend Requirements:
Interest expense (including debt
amortization) . . . . . . . . $ 18,482 $ 18,085 $ 13,846 $ 6,556 $ 5,358 $ 11,518
Estimated interest portion of
lease payments . . . . . . . . 1,813 1,947 1,555 513 315 1,114
Preferred stock dividend
requirements . . . . . . . 1,625 1,847 1,923 1,030 0 0
Total . . . . . . . . . . $ 21,920 $ 21,879 $ 17,324 $ 8,099 $ 5,673 $ 12,632
</TABLE>
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EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts"
in the Registration Statement (Form S-3) and related Prospectus of
Standard Brands Paint Company for the registration of 3,392,008 shares
of its common stock, 1,570,049 shares of its Series A Preferred Stock and
12,616,970 of common stock issuable upon conversion of the Series A
Preferred Stock and to the incorporation by reference therein of our report
dated April 7, 1995, with respect to the consolidated financial statements
of Standard Brands Paint Company included in its Annual Report (Form 10-K) for
the year ended January 29, 1995, filed with the Securities and Exchange
Commission.
ERNST & YOUNG LLP
Los Angeles, California
June 2, 1995
