<PAGE> 1
FORM lO-Q
---------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
20549
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-5869-1
SUPERIOR SURGICAL MFG. CO., INC.
Incorporated - New York Employer Identification No.
11-1385670
10099 Seminole Boulevard
Post Office Box 4002
Seminole, Florida 33775-0002
Telephone No.: 813-397-9611
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
As of the date of this report, the registrant had 8,133,552 common
shares outstanding.
Page 1
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PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
SUPERIOR SURGICAL MFG. CO., INC.
CONDENSED SUMMARY OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended September 30,
------------------------------------
1996 1995
------------- -------------
(Unaudited)
<S> <C> <C>
Net sales................................. $ 35,433,226 $ 33,267,467
------------ ------------
Costs and expenses:
Cost of goods sold...................... $ 23,261,706 $ 22,221,843
Selling and administrative expenses..... 8,161,832 7,548,589
Interest expense........................ 339,971 250,601
------------ ------------
$ 31,763,509 $ 30,021,033
------------ ------------
Earnings before taxes on income........... $ 3,669,717 $ 3,246,434
Taxes on income........................... 1,390,000 1,235,000
------------ ------------
Net earnings.............................. $ 2,279,717 $ 2,011,434
============ ============
Weighted average number of shares out-
standing during the period.............. 8,133,552 Shs. 8,363,552 Shs.
Net earnings per common share........... $0.28 $0.24
============ ============
Cash dividends declared per common
share................................. $0.09 $0.09
============ ============
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine Months Ended September 30,
------------------------------------
1996 1995
------------- -------------
(Unaudited)
<S> <C> <C>
Net sales................................. $105,002,376 $100,429,444
------------ ------------
Costs and expenses:
Cost of goods sold...................... $ 69,713,756 $ 66,983,969
Selling and administrative expenses..... 24,134,067 22,656,524
Interest expense........................ 973,663 697,574
------------ ------------
$ 94,821,486 $ 90,338,067
------------ ------------
Earnings before taxes on income........... $ 10,180,890 $ 10,091,377
Taxes on income........................... 3,865,000 3,835,000
------------ ------------
Net earnings.............................. $ 6,315,890 $ 6,256,377
============ ============
Weighted average number of shares out-
standing during the period.............. 8,133,552 Shs. 8,363,552 Shs.
Net earnings per common share........... $0.78 $0.75
============ ============
Cash dividends declared per common
share................................. $0.27 $0.27
============ ============
</TABLE>
The results of the nine months ended September 30, 1996 are not
necessarily indicative of results to be expected for the full year
ending December 31, 1996.
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SUPERIOR SURGICAL MFG. CO., INC.
CONDENSED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
September 30,
1996 December 31,
(Unaudited) 1995(1)
-------------- ------------
<S> <C> <C>
CURRENT ASSETS:
Cash and certificates of deposit............. $ 5,078,758 $ 5,421,553
Accounts receivable and other current assets. 24,617,734 25,876,100
Inventories*................................. 45,616,415 41,089,948
------------ ------------
TOTAL CURRENT ASSETS.................. $ 75,312,907 $ 72,387,601
PROPERTY, PLANT AND EQUIPMENT.................. 29,690,220 30,734,584
EXCESS OF COST OVER FAIR VALUE OF
ASSETS ACQUIRED............................. 819,439 822,926
OTHER ASSETS................................... 2,807,890 2,188,526
------------ ------------
$108,630,456 $106,133,637
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable............................. $ 8,641,482 $ 6,630,608
Other current liabilities.................... 5,826,265 3,575,151
Liability for dispute settlement............. - 6,500,000
Current portion of long-term debt............ 1,850,000 600,000
------------ ------------
TOTAL CURRENT LIABILITIES............. $ 16,317,747 $ 17,305,759
LONG-TERM DEBT................................. 16,450,000 18,000,000
DEFERRED INCOME TAXES.......................... 2,225,000 1,310,000
SHAREHOLDERS' EQUITY........................... 73,637,709 69,517,878
------------ ------------
$108,630,456 $106,133,637
============ ============
</TABLE>
* Inventories consist of the following:
<TABLE>
<CAPTION>
September 30,
1996 December 31,
(Unaudited) 1995
------------ ------------
<S> <C> <C>
Finished goods................. $ 27,210,739 $ 24,783,647
Work in process................... 3,816,668 3,515,698
Raw materials..................... 14,589,008 12,790,603
------------ ------------
$ 45,616,415 $ 41,089,948
============ ============
</TABLE>
(1) The balance sheet as of December 31, 1995 has been taken from the
audited financial statement as of that date and has been condensed.
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SUPERIOR SURGICAL MFG. CO., INC.
SUMMARY OF CASH FLOWS
<TABLE>
<CAPTION>
Nine Months Ended September 30,
-------------------------------
1996 1995
------------ ------------
(Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings................................. $ 6,315,890 $ 6,256,377
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Depreciation and amortization............. 3,170,941 2,654,432
Deferred income taxes..................... 915,000 290,000
Changes in assets and liabilities:
Accounts receivable and other current
assets................................ 1,258,366 16,258
Inventories............................. (4,526,467) (3,691,179)
Accounts payable ....................... 2,010,874 232,140
Other current liabilities............... 2,251,114 435,582
Liability for dispute settlement....... (6,500,000) -
----------- -----------
Net cash flows provided from operating
activities.................................. $ 4,895,718 $ 6,193,610
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant, and equipment.. $(2,123,090) $(5,551,768)
Other assets................................. (619,364) (242,982)
----------- -----------
Net cash (used) in investing activities...... $(2,742,454) $(5,794,750)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Reduction in long-term debt.................. $ (300,000) $ (300,000)
Declaration of cash dividends................ (2,196,059) (2,258,159)
----------- -----------
Net cash (used) in financing activities...... $(2,496,059) $(2,558,159)
----------- -----------
Net (decrease) in cash and
certificates of deposit.................. $ (342,795) $(2,159,299)
Cash and certificates of deposit balance,
beginning of year.............................. 5,421,553 11,233,700
----------- -----------
Cash and certificates of deposit balance,
end of period.........................,,,,,.... $ 5,078,758 $ 9,074,401
=========== ===========
</TABLE>
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SUPERIOR SURGICAL MFG. CO., INC.
NOTES TO SUMMARIZED INTERIM FINANCIAL STATEMENTS
Note 1 - Summary of Significant Interim Accounting Policies:
a) Recognition of costs and expenses
Costs and expenses other than product costs are charged to income in interim
periods as incurred, or allocated among interim periods based on an estimate of
time expired, benefit received or activity associated with the periods.
Procedures adopted for assigning specific cost and expense items to an interim
period are consistent with the basis followed by the registrant in reporting
results of operations at annual reporting dates. However, when a specific cost
or expense item charged to expense for annual reporting purposes benefits more
than one interim period, the cost or expense item is allocated to the interim
periods.
b) Inventories
Inventories at interim dates are determined by using both perpetual records and
gross profit calculations.
c) Accounting for income taxes
The provision for income taxes is calculated by using the effective tax rate
anticipated for the full year.
d) Earnings per share
Earnings per share have been computed based on the weighted average number of
shares outstanding during each period. The exercise of outstanding stock
options would not have a significant effect on earnings per share.
Note 2 - Capital Stock:
Pursuant to authorization by the Board of Directors in July, 1995, during
October, 1995, the registrant re-acquired and retired 230,000 shares of its
common stock for an aggregate consideration of $2,191,900.
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The interim information contained above is not certified or audited; it
reflects all adjustments (consisting of normal recurring accruals) which are,
in the opinion of management, necessary to a fair statement of the operating
results for the periods presented, stated on a basis consistent with that of
the audited financial statements.
The financial information included in this form has been reviewed by Deloitte &
Touche LLP, independent certified public accountants; such review was made in
accordance with established professional standards and procedures for such a
review.
All financial information has been prepared in accordance with the accounting
principles or practices reflected in the financial statements for the year
ended December 31, 1995, filed with the Securities and Exchange Commission.
Reference is hereby made to registrant's Financial Statements for 1995,
heretofore filed with registrant's Form 10-K.
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[LETTERHEAD OF DELOITTE & TOUCHE LLP]
BOARD OF DIRECTORS
Superior Surgical Mfg. Co., Inc.
Seminole, Florida
We have reviewed the accompanying condensed balance sheet of Superior Surgical
Mfg. Co., Inc. (the "Company") as of September 30, 1996, the condensed
summaries of operations for the nine-months and three-months ended September
30, 1996 and 1995 and the condensed summaries of cash flows for the nine-months
ended September 30, 1996 and 1995. This condensed financial information is the
responsibility of the Company's management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and of making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that
should be made to the accompanying condensed financial information for them to
be in conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the balance sheet as of December 31, 1995, and the related
statements of earnings, shareholders' equity, and cash flows for the year then
ended (not presented herein); and in our report dated March 8, 1996, we
expressed an unqualified opinion on those financial statements. In our opinion,
the information set forth in the accompanying condensed balance sheet as of
December 31, 1995 is fairly stated, in all material respects, in relation to
the balance sheet from which it has been derived.
/s/ Deloitte & Touche LLP
October 17, 1996
Page 7
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ITEM 2. Management's Discussion And Analysis of Financial Condition and
Results of Operations
RESULTS OF OPERATIONS
Net sales of the registrant increased by approximately 2% in the first quarter
of 1996 compared to the first quarter of 1995 due to new customers and new
uniform programs. For the second and third quarters of 1996 compared to 1995,
sales increased by approximately 6% and 7% respectively due to continued
momentum in the economic activities in the marketplaces served by the
registrant. Accordingly, for the nine months ended September 30, 1996, sales
were approximately 5% more than the nine months ended September 30, 1995.
Cost of goods sold approximated 66-1/2% for the nine months ended September 30,
1996 and 1995.
Selling and administrative expenses, as a percentage of sales, were
approximately 22-3/4% for the first nine months of 1996 and 1995.
Interest expense of $973,663 for the nine month period ended September 30,
1996 increased 40% from $697,574 for the similar period ended September 30,
1995 due to repayment of debt and lesser cash balances invested in certificates
of deposit.
Net earnings increased 13% to $2,279,717 for the three months ended September
30, 1996 as compared to net earnings of $2,011,434 for the same period ended
September 30, 1995 as a result of increased sales.
Accounts receivable and other current assets decreased 5% from $25,876,100 on
December 31, 1995 to $24,617,734 as of September 30, 1996.
Inventories as of September 30, 1996 increased 11% to $45,616,415 from
$41,089,948 on December 31, 1995 mainly to support expected future customer
demand.
Accounts payable increased 30% from $6,630,608 on December 31, 1995 to
$8,641,482 on September 30, 1996 primarily due to increases in purchases of
inventories.
The registrant's current portion of long-term debt of $1,850,000 and long-term
debt of $16,450,000 for September 30, 1996 is $300,000 less than it was at
December 31, 1995, due to scheduled repayments of debt.
LIQUIDITY AND CAPITAL RESOURCES
Cash and certificates of deposit decreased by $342,795 from $5,421,553 on
December 31, 1995 to $5,078,758 as of September 30, 1996. The change is
primarily a result of normal operations and the payment in the third quarter of
1996 of $6,500,000 to settle and finalize the previously announced dispute with
the federal government. Additionally, as of September 30, 1996, under its
existing revolving Credit Agreement, the registrant had $10,000,000 available
to it. The registrant has operated without hindrance or restraint with its
present working capital, as income generated from operations and outside
sources of credit, both trade and institutional, have been more than adequate.
In the foreseeable future, the registrant will continue its ongoing capital
expenditure program designed to maintain and improve its facilities. The
registrant at all times evaluates its capital expenditure program in light of
prevailing economic conditions. The registrant believes that its cash flow
from operating activities together with other capital resources and funds from
credit sources are adequate to meet its anticipated funding requirements for
the foreseeable future.
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PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
None.
ITEM 2. Changes in Securities
None.
ITEM 3. Defaults Upon Senior Securities
Inapplicable.
ITEM 4. Submission of Matters to a Vote of Security-holders
None.
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ITEM 5. Other Information
Inapplicable.
ITEM 6. Exhibits and Reports on Form 8-K
a) Exhibits
3 By-Laws of Registrant as amended August 9, 1996.
15 Letter re: Unaudited Interim Financial Information.
27 Financial Data Schedule (FOR SEC USE ONLY).
b) Reports on Form 8-K
None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: October 30, 1996 SUPERIOR SURGICAL MFG. CO., INC.
By /s/ Gerald M. Benstock
------------------------------------
Gerald M. Benstock
Chairman and Chief Executive Officer
By /s/ John W. Johansen
------------------------------------
John W. Johansen
Chief Financial Officer and Principal
Accounting Officer, Sr. Vice President
and Treasurer
Page 10
<PAGE> 1
EXHIBIT 3
BY-LAWS
OF
SUPERIOR SURGICAL MFG. CO., INC.
ARTICLE I: OFFICES:
Section 1:
The office of the Corporation shall be located in the County of Suffolk, State
of New York.
Section 2:
The Corporation may also have offices and places of business at such other
places within or without the State of New York as the Board of Directors may,
from time to time, determine, or the business of the Corporation may require.
ARTICLE II: MEETINGS OF SHAREHOLDERS:
Section 1:
The annual meeting of the shareholders for the election of directors, and all
special meetings of shareholders for that or any other purpose, may be held at
such time and place within or without the State of New York as shall be stated
in the notice of the meeting or in a duly executed waiver of notice thereof.
At least ten [10] days written notice shall be given to all shareholders in
advance of any meeting of shareholders [last sentence added February 5, 1969].
Section 2: [as amended May 17, 1974]:
The annual meeting of shareholders shall be held in each year upon such date as
may be determined by the Board of Directors; at such meeting the shareholders
shall elect a Board of Directors, and transact such other business as may
properly be brought before the meeting. The Board shall also determine the
place where the shareholders' meeting shall be held.
Section 3: [as amended May 8, 1986]:
Special meetings of the shareholders for any purpose or purposes, unless
otherwise prescribed by statute or by the Certificate of Incorporation, may be
called by the Chairman of the Board, by the President, or by the Board of
Directors, and shall be called by the President or the Secretary at the request
in writing of a majority of the Directors. Such request shall state the
purpose or purposes of the proposed meeting.
By-Laws -1-
<PAGE> 2
Section 4:
Except as otherwise provided by the Certificate of Incorporation, the holders
of a majority of the shares of the Corporation issued and outstanding and
entitled to vote thereon, present in person or by proxy, shall be necessary to
and shall constitute a quorum for the transaction of business at all meetings
of the shareholders.
ARTICLE III: DIRECTORS:
Section 1: (as amended August 2, 1996):
The number of directors which shall constitute the entire Board of Directors
shall be not less than three nor more than eight as the Board of Directors may,
by resolution adopted by a majority of the entire Board, from time to time
determine; directors need not be shareholders of the Corporation. Directors
shall be elected at the annual meeting of the shareholders, except as provided
in Section 3 of this Article III, and each director shall be elected to serve
until his successor shall have been elected and shall have qualified.
Section 2: (as amended May 8, 1986):
Any director may resign at any time. The shareholders entitled to vote for the
election of directors may remove a director with cause.
Section 3:
If any vacancies occur in the Board of Directors, for any reason whatsoever, or
if any new directorships are created, all of the directors then in office,
although less than a quorum, may by majority vote, choose a successor or
successors or fill the newly created directorship, and the directors so chosen
shall hold office until the next annual meeting of the shareholders and until
their successors shall have been duly elected and qualified, unless sooner
displaced; provided, however, that if in the event of any such vacancy the
directors remaining in office shall be unable by majority vote to fill such
vacancy within thirty days of the occurrence thereof, the Chairman or the
President may call a special meeting of the shareholders, at which such vacancy
shall be filled.
ARTICLE IV. MEETINGS OF THE BOARD:
Section 1:
The Board of Directors of the Corporation may hold meetings, both regular and
special, either within or without the State of New York.
By-Laws -2-
<PAGE> 3
Section 2:
Regular meetings of the Board of Directors shall be held without notice
immediately following the annual meeting of shareholders, and may be held
without notice at such time and at such place as shall, from time to time, be
determined by the Board.
Section 3:
Special meetings of the Board of Directors may be called by the Chairman of the
Board or by the President on two days notice to each director, either
personally or by mail or by telegram; special meetings shall be called by the
Chairman of the Board or the President in like manner and on like notice on the
written request of two directors.
Section 4:
At all meetings of the Board of Directors a majority of the entire Board shall
be necessary to and constitute a quorum for the transaction of business, and
the vote of a majority of the directors present at the time of the vote, if a
quorum is present, shall be the act of the Board of Directors except as may be
otherwise specifically provided by law or the Certificate of Incorporation. If
a quorum shall not be present at any meeting of the Board of Directors, the
directors present thereat may adjourn the meeting from time to time until a
quorum shall be present. Notice of such adjournment shall be given to any
directors who are not present and, unless announced at the meeting, to the
other directors.
Section 5: [added February 27, 1975]
Any action required or permitted to be taken by the Board of Directors may be
taken without a meeting provided all members of the Board of Directors consent
in writing to the adoption of a resolution authorizing such action, and further
provided such resolution and written consents of the directors thereto shall be
filed with the minutes of the Board of Directors.
ARTICLE IV-A: EXECUTIVE AND OTHER COMMITTEES
Section 1: How Constituted and the Powers thereof:
The Board of Directors by the vote of a majority of the entire Board, may
designate three or more directors to constitute an Executive Committee, who
shall serve during the pleasure of the Board of Directors. Except as otherwise
provided by law, by these By-Laws, or by resolution adopted by a majority of
the whole Board of Directors, the Executive Committee shall possess and may
exercise during the intervals between the meetings of the directors, all of
By-Laws -3-
<PAGE> 4
the powers of the Board of Directors in the management of the business, affairs
and property of the Corporation, including, without limitation, the power to
cause the seal of the Corporation to be affixed to all papers that may require
it, other than the powers enumerated in Sec. 712 (1)-(5) of the Business
Corporation Law of New York.
Section 2: Organization, etc.:
The Executive Committee may choose its own Chairman and its Secretary and may
adopt rules for its procedure. The Committee shall keep a record of its acts
and proceedings and report the same from time to time to the Board of
Directors.
Section 3: Meetings:
Meetings of the Executive Committee may be called by the Chairman of the
Committee, and shall be called by him at the request of any member of the
Committee; if there shall be no chairman, meetings may be called by any member
of the Committee. Notice of each meeting of the Committee shall be sent to
each member of the Committee by mail at least two days before the meeting is to
be held, or if given by the Chairman, may be given personally or by telegraph
or telephone at least one day before the day on which the meeting is to be
held. Notice of any meeting may be waived before, at or after the meeting, and
shall be deemed waived if the director attends the meeting without protesting
prior thereto or at its commencement, the lack of notice to him.
Section 4: Quorum and Manner of Acting:
A majority of the Executive Committee shall constitute a quorum for the
transaction of business, and the act of a majority of those present at the
meeting at which a quorum is present shall be the act of the Executive
Committee.
Section 5: Removal:
Any member of the Executive Committee may be removed, with or without cause, at
any time, by the Board of Directors.
Section 6: Vacancies:
Any vacancy in the Executive Committee shall be filled by the Board of
Directors.
Section 7: Other Committees:
The Board of Directors may, by resolution, provide for such other standing or
special committee as it deems desirable, and discontinue the same at pleasure.
Each Committee shall have such powers and perform such duties, not inconsistent
with law, as may be assigned to it by the Board of Directors.
By-Laws -4-
<PAGE> 5
Section 8: [added February 27, 1975]:
Any action required or permitted to be taken by the Executive Committee may be
taken without a meeting provided all members of said Committee consent in
writing to the adoption of a resolution authorizing such action, and further
provided such resolution and written consents of the members of said Committee
thereto be filed with the minutes of the Executive Committee.
ARTICLE V: [APPROVED BY THE BOARD OF DIRECTORS ON 5/1/92]:
Section 1:
The executive officers of the Corporation shall be:
a. Chairman of the Board
b. Chief Executive Officer
c. One or more Presidents
d. One or more Vice Presidents
e. Secretary (and Assistant Secretary, if designated by the Board
of Directors)
f. Treasurer (and Assistant Treasurer, if designated by the
Board of Directors)
Section 2:
All officers, as between themselves and the Corporation, shall have such
authority and perform such duties in the management of the Corporation as may
be provided in these By-Laws or, to the extent not so provided, by the Board of
Directors. The Board of Directors may also provide for the appointment of such
associate or assistant officers as the Board of Directors determines
appropriate or proper for the management of the Corporation and all such
associate or assistant officers, so appointed, shall have the authority and
responsibility as designated by the Board of Directors or, so long as not in
conflict, the Chief Executive Officer of the Corporation if such duties and
responsibilities have not otherwise been provided in the By-Laws of the
Corporation.
Section 3:
The Chairman of the Board of Directors shall preside at all meetings of the
Shareholders and Directors of the Corporation. The Chairman shall oversee all
directives and policies of the Board of Directors and shall supervise the
performance and authority of the Chief Executive Officer of the Corporation.
The Chairman shall further act for the Board in the absence of the directives
from the Board of Directors or its Executive Committee. The Chairman shall
have such other powers and duties as may, from time to time, be assigned to him
by the Board of Directors. The Chairman of the Board of Directors shall be
selected from among the Directors of the Corporation from time to time serving.
By-Laws -5-
<PAGE> 6
Section 4:
The Chief Executive Officer of the Corporation shall have primary, general and
active management and control of the business and affairs of the Corporation,
subject only to the direction of the Board of Directors, its Chairman and the
Shareholders. The Chief Executive Officer shall see that all orders and
resolutions of the Board of Directors, its Chairman and the Shareholders are
carried into effect. The Chief Executive Officer of the Corporation may also
be the Chairman of the Board of Directors or a President of the Corporation.
The Chief Executive Officer shall preside at all meetings of Shareholders and
Directors in the absence of the Chairman of the Board.
Section 5:
The Corporation may have one or more Presidents and, if more than one, the
duties and responsibilities of each President shall be as designated by the
Chief Executive Officer of the Corporation subject, nevertheless, to the
directives of the Board of Directors. A President shall have general and
active management and control of the business and affairs of the Corporation in
the areas designated by the Board of Directors and, if not in conflict
therewith, by the Chief Executive Officer of the Corporation but shall be
subject to direction by the Chief Executive Officer of the Corporation. A
President shall have such power and authority as necessary to carry out the
duties and responsibilities so assigned., In the event of the absence of the
Chairman of the Board who may then also be the Chief Executive Officer of the
Corporation, a President shall preside at all meetings of Shareholders and
Directors. Subject to contrary direction from the Board or the Chief Executive
Officer, a President shall have the power and authority to fulfill the duties
and responsibilities of any other President in the absence of such other
President.
Section 6:
The Vice President or Vice Presidents, if there be more than one, may be
assigned to specific areas, fields or divisions of the Corporation as may be
determined from time to time by the Board of Directors or, in the absence of
such determination, by the Chief Executive Officer of the Corporation or the
appropriate President if so authorized by the Chief Executive Officer. All
such Vice Presidents shall generally assist the Chief Executive Officer of the
Corporation and the President or Presidents of the Corporation and shall
perform such other duties and responsibilities as shall be prescribed by the
Board of Directors and, if not inconsistent therewith, by the Chief Executive
Officer of the Corporation or any President.
By-Laws -6-
<PAGE> 7
Section 7:
The Secretary (and in his absence any Assistant Secretary) shall attend all
meetings of the Board of Directors and all meetings of the Shareholders,
recording all votes and the minutes of all proceedings in a book to be kept for
that purpose. He shall give or cause to be given timely notice of all meetings
of the Shareholders and Board of Directors for which a notice is required by
law, the Articles of Incorporation or the By-Laws of this Corporation. He
shall also perform such other duties as may be prescribed by the Board of
Directors (or its Chairman) and, to the extent not in conflict therewith, by
the Chief Executive Officer of the Corporation under whose supervision the
Secretary shall act. The Secretary shall have custody of the seal of the
Corporation and shall have the responsibility to affix the seal of the
Corporation to all documents as authorized or directed by the Board of
Directors and, in the absence of such direction, by the Chief Executive Officer
of the Corporation.
Section 8:
The Treasurer (and in his absence any Assistant Treasurer) shall have the care
and custody of corporate funds and other valuable effects and assets of the
Corporation, shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation, and shall deposit all
monies in the name and to the credit of the Corporation in such depositories as
may be designated by the Board of Directors. The Treasurer shall disburse the
funds of the Corporation as may be ordered by the Board of Directors or, so
long as not in conflict therewith, by the Chief Executive Officer of the
Corporation, taking proper vouchers for such disbursements, and shall render to
the Board of Directors at regular or special meetings of the Board, or whenever
they require it, or to the Audit Committee of the Board of Directors, an
account of all transactions of the Corporation and of the financial condition
of the Corporation. If required by the Board of Directors, the Treasurer shall
give the Corporation a bond satisfactory to the Corporation but at the expense
of the Corporation. The Treasurer shall further provide such reports or
information regarding the condition of the Corporation, its assets and its
liabilities, as may be required, subject to direction by the Chief Executive
Officer, by all operating officers of the Corporation.
Section 9:
The Board of Directors may, at its discretion, from time to time designate the
Chairman of the Board of Directors, the Chief Executive Officer, one or more
Presidents or any Vice President as the Chief Operating Officer of the
Corporation who shall report to such officer, and perform such duties and
responsibilities, as may also be designated by the Board of Directors.
By-Laws -7-
<PAGE> 8
ARTICLE V-A: SHARES AND THEIR TRANSFER:
Section 1: Issue of Certificates of Stock:
The Board of Directors shall provide for the issue and transfer of the
certificates of stock of the Corporation and prescribe the form of such
certificates. Every owner of shares of the Corporation shall be entitled to a
certificate of stock, which shall be under the seal of the Corporation [which
seal may be a facsimile, engraved or printed], specifying the number of shares
owned by him, and which certificate shall be signed by the President or a Vice
President, or by the Chairman of the Board of Directors, and by the Secretary
or an Assistant Secretary or the Treasurer or an Assistant Treasurer of the
Corporation. Said signatures may, wherever permitted by law, be facsimile,
engraved or printed. In case any officer or officers who shall have signed, or
who facsimile signatures shall have been used on any such certificate or
certificates shall cease to be such officer or officers of the Corporation,
whether because of death, resignation or otherwise, before such certificate or
certificates shall have been delivered by the Corporation, such certificate or
certificates may nevertheless be issued and delivered as though the person or
persons who signed such certificate or certificates or whose facsimile
signature or signatures shall have been used thereon had not ceased to be such
officer or officers of the Corporation.
Section 2: Transfer Agents and Registrars:
The Board of Directors shall have power to appoint a Transfer Agent and/or
Registrar of its stock; to prescribe their respective duties; and to require
the countersignature of such Transfer Agent and/or Registrar upon stock
certificates. The duties of the Transfer Agent and Registrar may be combined.
Section 3: Transfer of Shares:
The shares of the Corporation shall be transferable only upon its books and by
the holders thereof in person or by their duly authorized attorneys or legal
representatives, and upon such transfer the old certificates shall be
surrendered to the Corporation by the delivery thereof to the person in charge
of the stock and transfer books and ledgers or to such other person as the
Board of Directors may designate for such purpose, and new certificates shall
thereupon be issued.
Section 4: Addresses of Shareholders:
Every shareholder shall furnish the Transfer Agent, or in the absence of a
Transfer Agent, the Registrar, or in the absence of a Transfer Agent and a
Registrar, the Secretary, with an address at or to which notices of meetings
and all other notices may be served upon or mailed to him, and in default
thereof, notices may be addressed to him at the office of the Corporation.
By-Laws -8-
<PAGE> 9
Section 5: Record Date:
The Board of Directors may fix a date not exceeding 50 days and not less than
10 days prior to the date of any meetings of shareholders or prior to the last
day on which the consent or dissent of shareholders may be effectively
expressed for any purpose without a meeting as the time as of which
shareholders entitled to notice of and to vote at such meeting or whose consent
or dissent is required or may be expressed for any purpose, as the case may be,
shall be determined, and all persons who were holders of record of voting
shares at such time and no others shall be entitled to notice of and to vote at
such meeting or to express their consent or dissent, as the case may be.
The Board of Directors shall also have power to fix a date not exceeding 50
days preceding the date fixed for the payment of any dividend or the making of
any distribution or for the allotment of any evidence of right or interest, or
for any other purpose, as a record time for the determination of the
shareholders entitled to receive any such dividend, distribution, right or
interest, or to participate in any such other action, and in such case only
shareholders of record at the time so fixed shall be entitled to receive such
dividend, distribution right or interest or to participate in such other
action.
Section 6: Lost and Destroyed Certificates:
The Board of Directors may direct a new certificate or certificates of stock to
be issued in the place of any certificate or certificates theretofore issued
and alleged to have been lost or destroyed, but the Board of Directors, when
authorizing such issue of a new certificate or certificates, may in its
discretion require the owner of the shares represented by the certificate so
lost or destroyed or his legal representative to furnish proof by affidavit or
otherwise to the satisfaction of the Board of Directors of the ownership of the
shares represented by such certificate alleged to have been lost or destroyed
and the facts which tend to prove its loss or destruction. The Board of
Directors may also require such person to execute and deliver to the
Corporation a bond, with or without sureties, in such sum as the Board of
Directors may direct, indemnifying the Corporation, its Transfer Agents and
Registrars, if any, against any claim that may be made against them, or any of
them, by reason of the issue of such certificate. The Board of Directors,
however, may in its discretion, refuse to issue any such new certificate,
except pursuant to court order. The Board may adopt such other and further
requirements or procedures for the replacement of lost or destroyed
certificates as it deems advisable, and may delegate to the Corporation's
Transfer Agent such duties and responsibilities in connection with such
replacement procedures as it deems advisable. [Last sentence added December
27, 1968.]
By-Laws -9-
<PAGE> 10
ARTICLE VI: GENERAL PROVISIONS:
Section 1:
All checks or demands for money and notes or other instruments evidencing
indebtedness or obligations of the Corporation shall be signed by such officer
or officers or such other person or persons as the Board of Directors may, from
time to time, designate.
Section 2:
The fiscal year of the Corporation shall begin on January first and end on
December thirty-first.
Section 3: [as amended May 8, 1986]:
The Board of Directors shall have power to amend, supplement, repeal or adopt
By-Laws at any regular or special meeting of the Board. However, any By-Law
adopted by the Board may be amended or repealed by the affirmative vote, at a
meeting, of a majority of the shares issued and outstanding and entitled to
vote thereon, and the Board of Directors shall take no action in conflict with
any By-Law so adopted by the shareholders.
By-Laws -10-
<PAGE> 1
EXHIBIT 15
[LETTERHEAD OF DELOITTE & TOUCHE LLP]
LETTER RE: UNAUDITED INTERIM FINANCIAL INFORMATION
BOARD OF DIRECTORS
Superior Surgical Mfg. Co., Inc.
Seminole, Florida
We have made a review, in accordance with standards established by the
American Institute of Certified Public Accountants, of the unaudited interim
financial information of Superior Surgical Mfg. Co., Inc. for the periods ended
September 30, 1996 and 1995, as indicated in our report dated October 17, 1996;
because we did not perform an audit, we expressed no opinion on that
information.
We are aware that our report referred to above, which is included in your
Quarterly Report on Form 10-Q for the quarter ended September 30, 1996, is
incorporated by reference in Registration Statement No 2-85796 on Form S-8.
We also are aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
/s/ Deloitte & Touche LLP
October 17, 1996
Page 11
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF SUPERIOR SURGICAL MFG. CO., INC. FOR THE NINE MONTHS
ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-1-1996
<PERIOD-END> SEP-30-1996
<CASH> 5,078,758
<SECURITIES> 0
<RECEIVABLES> 24,617,734
<ALLOWANCES> 0
<INVENTORY> 45,616,415
<CURRENT-ASSETS> 73,312,907
<PP&E> 29,690,220
<DEPRECIATION> 0
<TOTAL-ASSETS> 108,630,456
<CURRENT-LIABILITIES> 16,317,747
<BONDS> 16,450,000
0
0
<COMMON> 8,133,552
<OTHER-SE> 73,637,709
<TOTAL-LIABILITY-AND-EQUITY> 108,630,456
<SALES> 105,002,376
<TOTAL-REVENUES> 0
<CGS> 69,713,756
<TOTAL-COSTS> 94,821,486
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 973,663
<INCOME-PRETAX> 10,180,890
<INCOME-TAX> 3,865,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,315,890
<EPS-PRIMARY> 0.78
<EPS-DILUTED> 0.78
</TABLE>
