SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-----------------
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-5354
SWANK, INC.
(Exact name of registrant as specified in its charter)
Delaware 04-1886990
(State or other jurisdiction of incorporation (IRS employer identification
or organization) Number)
6 Hazel Street, Attleboro, Massachusetts 02703
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code 508-222-3400
Former name, former address and former fiscal year, if changed since last
report.
Indicate by X 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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date April 18, 1995
Title of Class Shares Outstanding
Common Stock 16,505,636
$.10 par value
<PAGE>
PART I - FINANCIAL STATEMENTS
Item 1. Financial Statements.
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
ASSETS March 31, 1995 December 31, 1994
<S> <C> <C> <C> <C>
Current:
Cash and temporary cash investments $ 631 $ 2,153
Accounts receivable, less allowances 16,529 13,874
of $6,432 and $9,484
Inventories, at the lower of cost
or market
Raw materials $ 3,924 $ 4,295
Work-in-process 7,166 7,987
Finished goods 15,919 27,009 13,867 26,149
------- -------
Deferred income taxes 4,105 4,105
Prepaid and other 2,202 977
------- ------
Total current assets 50,476 47,258
Property, plant and equipment, at cost 22,259 22,064
Less accumulated depreciation
and amortization 15,742 6,517 15,477 6,587
------- -------
Deferred income taxes 834 834
Other assets 3,129 2,779
------- -------
Total Assets $60,956 $57,458
======= =======
LIABILITIES
Current:
Notes payable to banks $16,500 $ 5,000
Current portion of long-term
obligations 999 2,920
Accounts payable, trade 3,045 3,665
Accrued employee compensation 1,544 3,010
Income taxes payable - 1,826
Other liabilities 6,097 6,512
------- -------
Total current liabilities 28,185 22,933
------- -------
Long-term obligations 4,096 4,308
------- -------
Total liabilities 32,281 27,241
======= =======
STOCKHOLDERS' EQUITY
Preferred stock, par value $1.00
Authorized 1,000,000 shares
Common stock, par value $.10:
Authorized 66,000,000 shares
Issued 16,839,155 and 16,804,155 1,683 1,680
Capital in excess of par value 837 825
Retained earnings 26,869 28,421
------- -------
29,389 30,926
Unearned ESOP shares 5 -
Treasury stock at cost 333,519 shares 709 709
------- -------
Total stockholders' equity 28,675 30,217
------- -------
Total liabilities and stockholders'
equity $60,956 $57,458
======= =======
The accompanying notes are an integral part of the consolidated financial
statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SWANK, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE QUARTERS ENDED MARCH 31, 1995 AND 1994
(Dollars in thousands)
----------------
1995 1994
<S> <C> <C>
Net sales $29,966 $29,002
Cost of goods sold 18,183 16,584
-------- -------
Gross profit 11,783 12,418
Selling and administrative expenses 14,124 12,691
-------- --------
Loss from operations (2,341) (273)
Interest charges 246 222
-------- --------
Loss before income taxes (2,587) (495)
Benefit for income taxes (1,035) (83)
-------- --------
Net loss $(1,552) $ (412)
======== ========
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Share and per share information:
Weighted average common shares and
common share equivalents outstanding 16,474,425 16,444,507
Net loss per share $(.09) $(.03)
====== ======
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
<CAPTION>
SWANK, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE QUARTERS ENDED MARCH 31, 1995 AND 1994
(Dollars in thousands)
----------
1995 1994
<S> <C> <C>
Cash flow from operating activities:
Net loss $ (1,552) $ (412)
Adjustments to reconcile net loss
to operating cash flows:
Increase in post-retirement benefits 68 90
Loan forgiveness in lieu of contribution to
employees' stock ownership plan - 236
Depreciation and amortization 266 262
Decrease in receivable reserves (3,052) (2,184)
Change in assets and liabilities
(Increase) decrease in accounts receivable 396 (494)
Increase in inventory (860) (3,821)
Increase in prepaid and other (1,575) (264)
Decrease in accounts payable, income taxes
payable and accrued other (4,606) (3,069)
--------- --------
Net cash used in operating activities (10,915) (9,656)
--------- --------
Cash flow from investing activities:
Capital expenditures (196) (175)
--------- --------
Net cash used in investing activities (196) (175)
--------- --------
Cash flow from financing activities:
Borrowing under revolving credit agreement 16,500 11,450
Payments of revolving credit agreement (5,000) (3,500)
Principal payments of long-term debt (1,921) (890)
Advance to employees stock ownership trust (5) -
Proceeds from exercise of employees' stock
options 15 33
--------- --------
Net cash provided by financing activities 9,589 7,093
--------- --------
Net decrease in cash and equivalents (1,522) (2,738)
Cash and equivalents at beginning of period 2,153 2,935
--------- --------
Cash and equivalents at end of period $ 631 $ 197
========= ========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
Notes to Unaudited Consolidated Financial Statements.
(1) The unaudited information furnished herein reflects all adjustments
(consisting only of normal recurring adjustments) which are, in the opinion of
management, necessary to present a fair statement of the results for the periods
ended March 31, 1995 and 1994. The financial information contained herein
represents condensed financial data and, therefore, does not include all
footnote disclosures required to be included in financial statements prepared
in conformity with generally accepted accounting principles. Footnote
information was included in the Company's annual report to stockholders for the
fiscal year ended December 31, 1994; the condensed financial data included
herein should be read in conjunction with the information in the annual report.
(2) Certain reclassifications have been made in the prior year's unaudited
consolidated financial statements to conform with the current year's
presentation. Accrued selling expenses, consisting of in-store markdowns and
cooperative advertising have been reclassified as accounts receivable
allowances. Equal amounts related to sales returns have been reclassified
between sales and cost of sales.
(3) During the first quarter 1995, the Company has not incurred any material
changes in the commitments and contingencies as previously referenced in
Footnote I of the 1994 annual report.
(4) During April, 1995, the Company has reduced the number of authorized
$.10 par value common shares from 66,000,000 to 43,000,000.
<PAGE>
Item 2. Managements's Discussion and Analysis of the Financial Condition and
Results of Operations
Results of Operations
As is customary in the fashion accessories industry, the Company makes
modifications to its lines coinciding with the Spring (January - June) and Fall
(July - December) seasons. The Company believes that results of operations are
considered to be more meaningful on a seasonal basis (six months) than on a
quarterly basis as the timing of sales (deliveries) and related income between
quarters can be affected by the availability of materials, retail sales and
fashion trends. These factors may affect the shift of volume between quarters
within a season differently in one year than another.
Quarters Ended March 31, 1995 AND 1994
Net sales for the quarter ended March 31, 1995 were $29,966,000, an
increase of $964,000 or 3% from the quarter ended March 31, 1994.
Sales increased in men's and women's jewelry $925,000 or 6% and men's
leather accessories $398,000 or 3%, offset in part, by decreased other product
line sales $359,000 or 30% compared to 1994. The increased sales in men's and
women's jewelry and men's leather accessories are attributable to sales from
the new Guess? lines, introduced in September of 1994, and expansion in the
customer base for the Company's special markets lines for jewelry and men's
leather accessories. The decreased sales in other product lines results
principally from the Company's decision to discontinue the sale and
distribution of men's accessories under various National Football League team
logos and the names and logos of several college and university teams.
Included in the sales figures above were sales from the Company's factory
outlets which decreased 15% compared to 1994. Decreases of 13% and 8% were
attributable to same store sales and closed store sales, respectively, offset
in part, by an increase of 6% in new store sales.
Gross profit for the quarter ended March 31, 1995 decreased $635,000 or 5%
from the quarter ended March 31, 1994. Gross profit expressed as a percentage
of net sales declined 4%, from 43% to 39%.
Gross profit decreased in men's and women's jewelry $633,000 or 9% and
men's leather accessories $270,000 or 5%, offset in part, by increased gross
profit for the Company's other product lines of $268,000 or 285%. The decreased
gross profit in men's and women's jewelry and men's leather accessories was a
result of unfavorable production variances caused by lower production levels,
lower margins on the current line as well as increased sales of off-price
merchandise. Gross profit increased in other product lines despite lower net
sales primarily as a result of fewer required inventory markdowns and less
royalty expense recognized.
Inventory levels increased $860,000 or 3% from December 31, 1994
reflecting the normal cyclical nature of the Company's sales. The increase is
smaller than in previous years, primarily as a result of increased sales of
excess inventory and a reduction in the number of items maintained in the
women's jewelry line. The increase in notes payable to banks at March 31, 1995
of $11,500,000 compared with December 31, 1994 is attributable to several
factors; higher outstanding borrowings at the beginning of 1995, increased long
term debt payments required under the Company's credit agreement, higher income
tax payments, and less cash generated from operations.
<PAGE>
Selling and administrative expenses increased $1,433,000 or 12% primarily
as a result of increased compensation costs, cooperative advertising and
displays. Compensation costs and related fringe benefits contributed to an
increase of $710,000 or 10%, relating primarily to additional personnel
required for the new Guess? lines and general wage increases. Cooperative
advertising and displays increased $107,000 or 22% and $128,000 or 45%,
respectively. Total advertising and promotion expressed as a percentage of net
sales remained unchanged at 7%.
Interest charges increased $24,000 or 11% as a result of increased short
term borrowings and interest rates, offset in part, by decreased long term
debt.
Income Taxes
The Company recognized an effective tax rate of 40%, which is above the
federal statutory rate of 34%, in order to recognize the combined federal and
state income tax expense. The higher effective tax rate in 1995 results from
the elimination of the valuation allowance against its net deferred tax asset
in the fourth quarter of 1994.
Current Liquidity
The Company's working capital decreased $2,034,000 during the three months
ended March 31, 1995.
The Company has maintained line of credit with banks to provide sufficient
working capital during the year. At March 31, 1995 the Company had a revolving
credit facility of $21,000,000, including a $7,000,000 letter of credit
facility, available through December 31, 1995 for seasonal working capital
needs. The Company's short-term bank borrowings are at peak during the months
of August through November. The Company anticipates a new revolving loan
agreement to be effective in the second quarter of 1995 that will meet its
working capital requirements for 1995. The Company has no material commitments
for capital expenditures.
Long-term Liquidity and Capital Resources
As is customary in the fashion accessories industry, substantial
percentages of the Company's sales and earnings occur in the months of
September, October and November, during which the Company makes significant
shipments of its products to retailers for sale during the holiday season. As a
result, receivables increase during the year and peak in the fourth quarter.
The Company builds its inventory during the first three quarters of the year to
respond to the holiday season. Cash required is provided by a revolving credit
facility. Outstanding balances for this credit facility are required to be paid
in full for a 30 day period during the first six months of each year. Cash
generated from operations is used to pay down the credit facility during the
months of December and January.
Cash used in operations for the first three months totaled $10,915,000
consisting primarily of a $1,552,000 net loss, reductions in accounts payable,
income taxes payable and other accrued items, and increases in inventory and
prepaid expenses. Cash used in investing activities was $196,000 for
replacement of used machinery and equipment. Cash provided by financing
activities totaled $9,589,000 consisting primarily from borrowings under the
revolving credit agreement, offset in part, by payments of the revolving credit
agreement and long term debt.
Net accounts receivable increased primarily as a result of increased sales
and reductions in the reserves against accounts receivable. The reductions of
<PAGE>
the reserves reflect the actual charges as processed for cash discounts,
doubtful accounts, in-store markdowns, cooperative advertising and gross profit
on returns.
In 1992 the Company refinanced all existing long-term debt with proceeds
of a $9,000,000 bank term loan. The loan bears interest at the prime rate plus
2% and is collaterized by all of the Company's assets. Cash provided from
operating activities and the sale of certain operations have provided funds for
the reduction of long -term debt to $999,000 at April 18, 1995.
The terms of the agreement, as amended, require the Company to maintain
certain financial ratios and minimum amounts of tangible net worth. The
agreement also limits capital expenditures, prohibits additional indebtedness
over specified amounts and contains other covenants normally associated with
such agreements.
Pursuant to the Company's credit agreement, as amended, certain financial
ratios are required to be met for the quarter ended March 31, 1995. These
include leverage and current ratios of 1.10 to 1 and 1.90 to 1, respectively.
As of March 31, 1995 the actual leverage and current ratios were 1.10 to 1 and
1.81 to 1, respectively. The Company was not in compliance with the quarterly
current ratio covenant. The banks have agreed to waive the aforementioned
default. The Company is in the process of negotiating a new revolving loan
agreement and anticipates new covenants to be established.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3.02 By-laws of the Company, as amended to date
3.03 Articles of Incorporation of the Company, as amended to date.
10.15.2 Stock option contract dated as of April 20, 1995 between the
Company and Raymond Vise.
10.15.3 Stock option contract dated as of April 20, 1995 between the
Company and William B. MacLeod.
10.15.4 Stock option contract dated as of April 20, 1995 between the
Company and Mark Abramowitz.
27.0 Financial data schedule.
(b) Current reports on Form 8-K - none
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act Of 1934, the
registrant has caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
SWANK, INC.
Registrant
Andrew C. Corsini
Senior Vice President, Treasurer
and Chief Financial Officer
Date:MAY 12, 1995
As of 4/20/95
BY-LAWS
OF
SWANK, INC.
ARTICLE I
OFFICES
1. The principal office shall be in the City of Dover, County of Kent,
State of Delaware, and the name of the resident agent in charge thereof is
The Prentice-Hall Corporation System, Inc.
2. The corporation may also have an office or offices at such other
place or places, within or without the State of Delaware, as the Board of
Directors may from time to time designate or the business of the corporation
may require.
ARTICLE II
Stockholders' Meetings
1. The annual meeting of the stockholders of the corporation shall be
held at such place within or without the State of Delaware and at such time
and date as may be determined by the Board of Directors and shall be
designated in the notice of said meeting, for the purpose of electing
directors and for the transaction of such other business as may be properly
be brought before the meeting.
If the election of directors shall not be held on the day designated
herein for any annual meeting, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of the
stockholders as soon thereafter as conveniently may be. At such meeting the
stockholders may elect the directors and transact other business with the
same force and effect as at an annual meeting duly called and held.
2. Special meetings of the stockholders shall be held at the principal
office of the Corporation in the state of Delaware, or at such other place
within or without the State of Delaware as may be designated in the notice of
said meeting, upon call of the Board of Directors, and shall be called by the
President or Secretary at the request in writing of stockholders owning of
record at lease twenty-five per cent of the issued and outstanding capital
stock of the corporation entitled to vote thereat.
3. Notice of the purpose or purposes and of the time and place within
or without the State of Delaware of every meeting of stockholders shall be
given by the President or a Vice President or the Secretary or an Assistant
Secretary either personally or by mail or by telegraph or by any other lawful
means of communication not less than ten days before the meeting, to each
stockholder of record entitled to vote at such meeting. If mailed, such
notice shall be directed to each stockholder at his address as it appears on
the stock book unless he shall have filed with the Secretary of the
corporation a written request that notices intended for him be mailed to some
other address, in which case it shall be mailed or transmitted to the address
designated in such request. Such further notice shall be given as may be
required by law. Except as otherwise expressly provided by statute, no
publication of any notice of a meeting of stockholders shall be required to
be given to any stockholder who shall attend such meeting in person or by
proxy, or who shall, in person or by attorney thereunto authorized, waive
such notice in writing or by telegraph, cable, radio, or wireless either
before or after such meeting. Except where otherwise required by law, notice
of any adjourned meeting of the stockholders of the corporation shall not be
required to be given.
4. A quorum at all meetings of stockholders shall consist of the
holders of record of a majority of the shares of stock of the corporation,
issued and outstanding, entitled to vote at the meeting, present in person or
by proxy, except as otherwise provided by statute or the Certificate of
Incorporation. In the absence of a quorum at any meeting or any adjournment
thereof, a majority of those present in person or by proxy and entitled to
vote may adjourn such meeting from time to time. At any such adjourned
meeting at which a quorum is present any business may be transacted which
might have been transacted at the meeting as originally called.
5. Meetings of the stockholders shall be presided over by the
President, or if he is not present, by the Chairman of the Board, if any, nor
if neither the President nor the Chairman of the Board, if any, is present,
by a chairman to be chosen by a majority of the stockholders entitled to vote
who are present in person or by proxy at the meeting. The Secretary of the
corporation, or in his absence, an Assistant Secretary, shall act as
secretary of every meeting, but if neither the Secretary nor an Assistant
Secretary is present, the meeting shall choose any person present to act as
secretary of the meeting.
6. Except as otherwise provided in the By-Laws, the Certificate of
Incorporation, or in the laws of the State of Delaware, at every meeting of
the stockholders, each stockholder of the Corporation entitled to vote at
such meeting shall have one vote in person or by proxy for each share of
stock having voting rights held by him and registered in his name on the
books of the corporation at the time of such meeting. Any vote on shares of
stock of the corporation may be given by the stockholder entitled thereto in
person or by his proxy appointed by an instrument in writing, subscribed by
such stockholder or by his attorney thereunto authorized and delivered to the
secretary of the meeting. Except as otherwise required by statute, by the
Certificate of Incorporation or these By-Laws, all matters coming before any
meeting of the stockholders shall be decided by a plurality vote of the
stockholders of the Corporation present in person or by proxy at such meeting
and entitled to vote thereat, a quorum being present. At all elections of
directors the voting may but need not be by ballot and a plurality of the
votes cast thereat shall elect.
7. A complete list of the stockholders entitled to vote at the ensuing
election of directors, arranged in alphabetical order, and showing the
address of each stockholder and the number of shares registered in the name
of each stockholder shall be prepared by the Secretary or other officer of
the Corporation having charge of the stock ledger. Such list shall be open
to the examination of any stockholder during ordinary business hours, for a
period of at least ten days prior to the election, either at a place within
the city, town or village where the election is to be held, which place shall
be specified in the notice of the meeting, or, if not so specified, at the
place where said meeting is to be held, and the list shall be produced and
kept at the time and place of election during the whole time thereof, and
subject to the inspection of any stockholder who may be present.
8. At all elections of directors, or in any other case in which
inspectors may act, two inspectors of election shall be appointed by the
chairman of the meeting, except as otherwise provided by law. The inspectors
of election shall take and subscribe an oath faithfully to execute the duties
of inspectors at such meeting with strict impartiality, and according to the
best of their ability, and shall take charge of the polls and after the vote
shall have been taken shall make a certificate of the result thereof. If
there be a failure to appoint inspectors or if any inspector appointed be
absent or refuse to act, or if his office becomes vacant, the stockholders
present at the meeting, by a per capita vote, may choose temporary inspectors
of the number required.
ARTICLE III
Directors
1. The property, affairs and business of the corporation shall be
managed by its Board of Directors consisting of not less than three (3) nor
more than twenty-one (21) persons. The exact number of directors within the
maximum limitations specified shall be fixed from time to time by the Board
of Directors. The Board of Directors shall be divided into three classes,
Class I, Class II and Class III, which shall be as nearly equal in number as
possible. At the annual meeting of stockholders to be held in 1995, Class I
directors shall be elected for a term expiring at the annual meeting of
stockholders to be held in 1996, and Class II directors shall be elected for
a term expiring at the annual meeting of stockholders to be held in 1997, and
Class III directors shall be elected for a term expiring at the annual
meeting of stockholders to be held in 1998, with each such director to hold
office until his successor shall be elected and qualify. At each annual
meeting of stockholders commencing with the annual meeting of stockholders to
be held in 1996, the successors of the class of directors whose term expires
at that annual meeting shall be elected for a term expiring at the third
successive annual meeting of stockholders and until their respective
successors shall be elected and qualify. Directors shall be elected by
plurality vote. No decrease in the number of directors constituting the
Board of Directors shall shorten the term of any incumbent director. Newly
created directorships shall be so apportioned among the classes of directors
as to make all such classes as nearly equal in number as possible.
2. Meetings of the Board of Directors shall be held at such place
within or outside the State of Delaware as may from time to time be fixes by
resolution of the Board of Directors, or as may be specified in the notice of
the meeting. Regular meetings of the Board of Directors shall be held at
such times as may from time to time be fixed by resolution of the Board of
Directors, and special meetings may be held at any time upon the call of the
President, Secretary, or a majority of the directors by oral, telegraphic or
written notice duly served on or sent or mailed to each director not less
than three days before such meeting. A meeting of the Board of Directors may
be held without notice immediately after the annual meetings of stockholders.
Notice need not be given of regular meetings of the Board of Directors.
Meetings may be held at any time without notice if all the directors are
present, or if at any time before or after the meeting those not present
waive notice of the meeting in writing.
3. A majority of the members of the Board of Directors then acting,
but in no event less than one-third nor less than two of the number of
directors authorized, acting at a meeting duly assembled, shall constitute a
quorum for the transaction of business, but if at any meeting of the Board of
Directors there shall be less than a quorum present, a majority of those
present may adjourn the meeting, without further notice, from time to time
until a quorum shall have been obtained.
4. In case one or more vacancies shall occur in the Board of Directors
by reason of death, resignation, increase in the number of directors or
otherwise except in so far as otherwise provided in these By-Laws, the
remaining directors, although less than a quorum, may, by a majority vote,
elect a successor or successors for the unexpired term or terms.
5. An Executive Committee of two (2) or more directors may be
designated by resolution passed by a majority of the whole Board of
Directors. The act of a majority of the members of said Committee shall be
the act of the Committee, and said Committee may meet at stated times or on
notice. Whenever the Board of Directors is not in session or whenever a
quorum of the Board of Directors fails to attend any regular or special
meeting of the Board, said Committee shall advise with and aid the officers
of the corporation in all matters concerning its interests and the management
of its business and affairs, and generally perform such duties and exercise
such powers as may be performed and exercised by the Board of Directors from
time to time, and the Executive Committee shall have the power to authorize
the seal of the Corporation to be affixed to all papers which may require it
and, in so far as may be permitted by law, exercise the powers and perform
the obligations of the Board of Directors. The Board of Directors may also
designate one or more committees in addition to the Executive Committee by
resolution or resolutions passed by a majority of the whole Board of
Directors; such committee or committees to consist of two (2) or more
directors of the corporation and, to the extent provided in the resolution or
resolutions designating them, shall have or may exercise the specific powers
of the Board of Directors in the management of the business and affairs of
the corporation. such committee or committees shall have such name or names
as may be determined from time to time by resolution adopted by the Board of
Directors.
6. Any director may be removed only for cause and only at a special
meeting of the stockholders, duly called as provided in these By-Laws, by the
affirmative vote of the holders of a majority of the issued an outstanding
shares of the corporation's shares of capital stock entitled to vote for the
election of directors.
7. Each director and officer now or hereafter in office and his heirs,
executors and administrators, and each director and officer and his heirs,
executors and administrators, who now acts, or shall hereafter act, at the
request of the corporation as a director or officer of another corporation
controlled by the corporation shall be indemnified by the corporation against
all costs, expenses and amounts or liability therefor, including counsel
fees, reasonably incurred by or imposed upon him in connection with or
resulting from any suit, action, proceeding or claim to which he may be made
a party, or in which he may be or become involved by reason of his being or
having been such director or officer or, subject to the provisions hereof,
any settlement thereof, whether or not he continues to be such director or
officer at the time of incurring such costs, expenses or amounts, provided
that such indemnification shall not apply with respect to any matter as to
which such director or officer shall be finally adjudged in such action, suit
or proceeding to have been individually guilty of wilful misfeasance or
malfeasance in the performance of his duty as such director or officer, and
provided, further, that the indemnification herein provided shall, with
respect to any settlement of any such suit, action, proceeding or claim,
include reimbursement of any amounts paid and expenses reasonably incurred in
settling any such suit action, proceeding or claim, when, in the judgment of
the Board of Directors of the corporation, such settlement and reimbursement
appear to be for the best interests of the corporation. The foregoing right
of indemnification shall be in addition to and not exclusive of any and all
other rights to which any such director or officer may be entitled by statute
or under any By-Law, agreement, vote of stockholders or otherwise.
8. Any action required or permitted to be taken at any meeting of the
Board of Directors or any committee thereof may be taken without a meeting if
prior to such action a written consent thereto is signed by all members of
the Board of Directors or of the committee, as the case may be, and such
written consent is filed with the minutes of proceedings of the Board of
Directors or the committee.
9. Directors may, by resolution of the Board of Directors, be allowed
a fixed sum and expenses of attendance for attendance at regular or special
meetings of the Board of Directors; provided that noting herein contained
shall be construed to preclude any director from serving the corporation in
any other capacity and receiving compensation therefor. Members of special
or standing committees, and others who attend pursuant to direction, may, by
vote of the Board of Directors, be allowed a like fixed sum and expenses of
attendance for attending committee meetings.
ARTICLE IV
Officers
1. The officers of the corporation shall be chosen by the Board of
Directors and shall be a President, who shall be a director, one or more Vice
Presidents, a Secretary and a Treasurer. The Board of Directors may also
appoint such Assistant Secretaries, Assistant Treasurers and such other
officers as it may deem proper. The Board of Directors may elect from its
members a Chairman of the Board, who shall be an officer of the Corporation.
The Board of Directors may also designate one of the Vice Presidents to be
Executive Vice President. Any two or more officers may be held by the same
person.
2. The terms of office of all officers shall be one year and until
their respective successors are elected an qualify, but any officer may be
removed from office, either with or without cause, at any time by the
affirmative vote of a majority of the members of the Board of Directors then
in office. A vacancy in any office arising from any cause may be filled for
the unexpired portion of the term by the Board of Directors.
3. Unless otherwise ordered by the Board of Directors, the President
shall have full power and authority on behalf of the Corporation to attend
and to act and to vote at any meetings of security holders of the
corporations in which the corporation may hold securities, and at such
meeting shall possess and may exercise any and all rights and powers incident
to the ownership of such securities, and which as the owner thereof the
Corporation might have possessed and exercised, if present. The Board of
Directors by resolution from time to time may confer like powers upon any
other person or persons.
ARTICLE V
Duties of Officers
1. The President shall preside at all meetings of stockholders and if
there be no Chairman of the Board or in the absence of the Chairman of the
Board, he shall preside at all meetings of the Board of Directors. He shall
be the principal executive officer of the corporation and as such shall have
general and active direction of the business of the corporation. He shall
have such other duties and powers as may be assigned to him from time to time
by the Board of Directors.
2. The Chairman of the Board, if one be elected, shall preside at all
meetings of the Board of Directors and in the absence of the President shall
preside at all meeting of stockholders. He shall do and perform such other
duties as may be assigned to him from time to time by the Board of Directors.
3. Except as provided above, during the absence or disability of the
President, the Executive Vice President, if one be elected, shall exercise
all the functions of the President. Each Vice President shall have such
powers and discharge such duties as may be assigned to him from time to time
by the Board of Directors.
4. The Treasurer shall have the custody of all the funds and
securities of the corporation. When necessary or proper he shall endorse on
behalf of the corporation, for collection, checks, notes and other
obligations and shall deposit the same to the credit of the corporation in
such bank, or banks, or depositories as may be designated by the Board of
Directors, or by any officer acting under authority conferred by the Board of
Directors. He shall enter regularly in books to be kept for the purpose, a
full and accurate account of all moneys received and paid by him on account
of the corporation. Whenever required by the Board of Directors, he shall
render an account of all his transactions as Treasurer and of the financial
condition of the corporation. He shall at all reasonable times exhibit his
books and accounts to any director of the corporation upon application at the
office of the corporation during business hours and he shall perform all
things incident to the position of Treasurer, subject to the control of the
Board of Directors. He shall give bond for the faithful discharge of his
duties if the Board of Directors so require. He shall do and perform such
other duties as may be assigned to him from time to time by the Board of
Directors.
5. The Assistant Treasurers, in the order of their seniority, shall,
in the absence of or disability of the Treasurer, perform the duties and
exercise the powers of the Treasurer and shall perform such other duties as
the Board of Directors shall prescribe.
6. The Secretary shall attend all meetings of the stockholders and all
meetings of the Board of Directors, and record all votes and the minutes of
all proceedings in a book to be kept for that purpose; and shall perform like
duties for other committees when so required. He shall give, or cause to be
given, notice of all meetings of stockholders and of the Board of Directors
and of committees and shall perform such other duties as may be prescribed by
the Board of Directors. He shall keep in safe custody the seal of the
corporation and affix the same to any instrument whose execution has been
authorized. He shall be sworn to the faithful discharge of his duties. He
shall do and perform such other duties as by be assigned to him from time to
time by the Board of Directors.
7. The Assistant Secretaries, in the order of their seniority, shall
in the absence of or disability of the Secretary, perform the duties and
exercise the powers of the Secretary and shall perform such other duties as
the Board of Directors shall prescribe.
8. In the case of absence or inability to act of any officer of the
corporation and of any person herein authorized to act in his place, the
Board of Directors may from time to time delegate the powers and duties of
such officer to any other officer or any director or any other person whom it
may select.
9. Unless the Board of Directors shall otherwise direct, the salary of
the President and of the Chairman of the Board, if one be elected, shall be
fixed by the Board of Directors and the salaries of all other officers and
employees be fixed by the President.
ARTICLE VI
Certificate of Stock
1. The interest of each stockholder of the corporation shall be
evidenced by certificates for shares of stock, certifying the number of
shares represented thereby and in such form not inconsistent with the
Certificate of Incorporation as the Board of Directors may from time to time
prescribe.
Transfers of shares of stock of the corporation shall be made on the
books of the corporation by the registered holder thereof, or by his attorney
thereunto authorized by power of attorney duly executed and filed with the
Secretary of the corporation, or with a transfer clerk or a transfer agent
appointed as in these By-Laws provided, and on surrender of the certificate
or certificates for such shares properly endorsed and the payment of all
taxes thereon. The person in whose name shares of stock stand on the books
of the corporation shall be deemed the owner thereof for purposes as regards
the corporation. The Board may, from time to time, make such additional
rules and regulations as it may deem expedient, not inconsistent with these
By-Laws, concerning the issue, transfer, and registration of certificates for
shares of the capital stock of the corporation.
The certificates of stock shall be signed by the Chairman or Vice-
Chairman of the Board of Directors, or the President or any Vice-President
and by the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer, and sealed with the seal of the Corporation. Such seal
may be a facsimile, engraved or printed. If any such certificate is
countersigned by a transfer agent or a registrar other than the Corporation,
any other signatures on the certificate may be facsimile, engraved or
printed. In case any such officer, transfer agent or registrar who has
signed or whose facsimile signature has been placed upon such certificate
shall have ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued the Corporation with the same effect
as if he were such officer, transfer agent or registrar at the date of issue.
2. The Board of Directors may, in its discretion, fix in advance a
date, not exceeding sixty (60) days preceding the date of any meeting of
stockholders or the date for the payment of any dividend or the date for the
allotment of rights or the date when any change or conversion or exchange of
capital stock shall go into effect or a date in connection with obtaining
such consent, as a record date for the determination of the stockholders
entitled to notice of, and to vote at, any such meeting, and any adjournment
thereof, or entitled to receive payment of any such dividend, or to any such
allotment of rights, or to exercise the rights in respect of any such change,
conversion or exchange of capital stock, or to give such consent, and in such
case such stockholder, and only such stockholders as shall be stockholders of
record on the date so fixed, shall be entitled to such notice of, and to vote
at, such meeting and any adjournment thereof, or to receive payment of such
dividend, or to receive such allotment of rights, or to exercise such rights,
or to give such consent, as the case may be, notwithstanding any transfer of
any shares of stock on the books of the corporation after any such record
date fixed as aforesaid.
3. No certificate for shares of stock of the corporation shall be
issued in place of any certificate alleged to have been lost, destroyed or
stolen, except on production of such evidence of such loss, destruction or
theft and on delivery to the Corporation, if the Board of Directors shall so
require, of a bond of indemnity in such amount, upon such terms and secured
by such surety as the Board of Directors may in its discretion require.
4. The Board of Directors may appoint one or more transfer clerks or
one or more transfer agents and one or more registrars, and may require all
certificates for shares of stock to bear the signature or signatures of any
of them.
5. The books, accounts and records of the corporation, except as may
otherwise be required by statue, may be kept outside the State of Delaware,
at such place or places as the Board of Directors may from time to time
appoint. The Board of Directors shall determine whether and to what extent
the books, accounts and records of the corporation, or any of them, other
than the stock ledger, shall be open to the inspection of stockholders, and
no stockholder shall have any right to inspect any book, account or record
the Corporation except as conferred by statue or by resolution of the Board
of Directors.
ARTICLE VII
Corporate Seal
The corporate seal of the corporation shall consist of two concentric
circles between which shall be the name of the Corporation and the words
"Corporate Seal" and in the center shall be inscribed the words "Delaware
1936".
ARTICLE VIII
Amendments
The By-Laws of the corporation shall be subject to alteration, amendment
or repeal, and new By-Laws not inconsistent with any provision of the
Certificate of Incorporation or statute, may be made, either by the
affirmative vote of the holders of a majority in interest of the stock of the
corporation present in person or by proxy at any annual or special meeting of
the stockholders and entitled to vote thereat a quorum being present,
provided that notice of such proposed action shall have been given in the
call for the meeting, or by the affirmative vote of a majority of the whole
Board, given at any regular or special meeting of the Board of Directors.
10Q\bylaw395
RESTATED CERTIFICATE OF INCORPORATION
OF
SWANK, INC.
It is hereby certified that:
1. (a) The present name of the corporation (hereinafter called
the "Corporation") is Swank, Inc.
(b) The name under which the Corporation was originally
incorporated is Swank Products, Inc., and the date of filing of the
original certificate of incorporation of the Corporation with the
Secretary of State of the State of Delaware is April 17, 1936.
2. The provisions of the certificate of incorporation of the
Corporation as heretofore amended and/or supplemented, are hereby
restated and integrated into the single instrument which is hereinafter
set forth, and which is entitled Restated Certificate of Incorporation
of Swank, Inc. without further amendment and without any discrepancy
between the provisions of the certificate if incorporation as
heretofore amended and supplemented and the provisions of the said
single instrument hereinafter set forth.
3. The Board of Directors of the Corporation has duly adopted
this Restated Certificate of Incorporation pursuant to the provisions
of Section 245 of the General Corporation Law of the State of Delaware
in the form set forth as follows:
"RESTATED CERTIFICATE OF INCORPORATION
OF
SWANK, INC."
FIRST: The name of the Corporation (hereinafter called the
"Corporation") is SWANK, INC.
SECOND: The address, including street number, city and county of
the registered office of the Corporation in the State of Delaware is
229 South State Street, City of Dover, County of Kent; and the name of
the registered agent of the Corporation in the State of Delaware at
such address is The Prentice-Hall Corporation System, Inc.
THIRD: The nature of the business, or objects or purposes to be
transacted, promoted or carried on are:
To manufacture, buy, sell, import, export, trade and
deal in jewelry and wearing apparel of every kind and
description.
To manufacture, purchase or otherwise acquire, own,
mortgage, pledge, sell, assign and transfer, or otherwise
dispose of, to invest, trade, deal in and deal with
goods, wares and merchandise and personal property of
every class and description.
To acquire, and pay for in cash, stock or bonds of
this Corporation or otherwise, the good will, rights,
assets and property, and to undertake or assume the whole
or any part of the obligations or liabilities of any
person, firm, association or corporation.
To acquire, hold, use, sell, assign, lease, grant
licenses in respect of, mortgage or otherwise dispose of
letters patent of the United States or any foreign
country, patent rights, licenses and privileges,
inventions, improvements and processes, copyrights,
trademarks and trade names, relating to or useful in
connection with any business of this Corporation.
To guarantee, purchase, hold, sell, assign,
transfer, mortgage, pledge or otherwise dispose of shares
of the capital stock of, or any bonds, securities or
evidences of indebtedness created by any other
corporation or corporations organized under the laws of
this state or any other state, country, nation or
government, and while the owner thereof to exercise all
the rights, powers and privileges of ownership, including
the right to vote thereon.
To enter into, make and perform contracts of every
kind and description with any person, firm, association,
corporation, municipality, county, state, body politic or
government or colony or dependency thereof.
To borrow or rise moneys for any of the purposes of
the Corporation and, from time to time, without limit as
to amount, to draw, make, accept, endorse, execute and
issue promissory notes, drafts, bills of exchange,
warrants, bonds, debentures and other negotiable or non-
negotiable instruments and evidences of indebtedness, and
to secure the payment of any thereof and of the interest
thereon by mortgage upon or pledge, conveyance or
assignment in trust of the whole or any part of the
property of the Corporation, whether at the time owned or
thereafter acquired and to sell, pledge or otherwise
dispose of such bonds or other obligations of the
Corporation for its corporate purposes.
To purchase, hold, sell and transfer the shares of
its own capital stock; provided it shall not use its
funds or property for the purchase if its own shares of
capital stock when such use would cause any impairment of
its capital except as otherwise permitted by law, and
provided further that shares of its own capital stock
belonging to it shall not be voted upon directly or
indirectly.
To have one or more offices, to carry on all or any
of its operations and business and without restriction or
limit as to amount to purchase or otherwise acquire,
hold, own, mortgage, sell, convey, or otherwise dispose
of real and personal property of every class and
description in any of the States, Districts, Territories,
or Colonies of the United States, and in any and all
foreign countries, subject to the laws of such State,
District, Territory, Colony or Country.
In general, to carry on any other business in
connection with the foregoing, and to have and exercise
all the powers conferred by the laws of Delaware upon
corporations formed under the act hereinafter referred
to, and to do any or all of the things hereinbefore set
forth to the same extent as natural persons might or
could do.
The objects and purposes specified in the foregoing
clauses shall, except where otherwise expressed, be in no
way limited or restricted by reference to, or inference
from, the terms of any other clause in this Certificate
of Incorporation, but the objects and purposes specified
in each of the foregoing clauses of this article shall be
regarded as independent objects and purposes.
FOURTH: The total number of shares of all classes of capital
stock which the Corporation shall have authority to issue is seven
million (7,000,000) shares of which six million (6,000,000) shares
shall be designated Common Stock of the per value of One Dollar ($1.00)
per share, and one million (1,000,000) shares shall be designated
Preferred Stock of the par value of One Dollar ($1.00) per share.
The designations, preferences and relative, participating,
optional and other special rights of the Preferred Stock and the Common
Stock and the qualifications, limitations and restrictions thereof, are
as follows:
I. Common Stock
1. Subject to provisions of law and the preferences of the
Preferred Stock and of any other stock ranking prior to the Common
Stock as to dividends, the holders of the Common Stock shall be
entitled to receive dividends at such time and in such amounts as may
be determined by the Board of Directors.
2. Except as otherwise provided by law in the Certificate of
Incorporation or except as determined pursuant to authority of the
Board of Directors as herein provided (i) all voting rights shall be
vested exclusively in the holders of the outstanding shares of Common
Stock and each such holder shall be entitled to one vote per share for
all purposes for each share of Common Stock held of record by him and
(ii) the holders of Preferred Stock shall not be entitled to vote for
any purpose nor shall they be entitled to notice of meetings of
stockholders.
3. In the event of any liquidation, dissolution or winding up of
the Corporation, after payment or provision for payment of the debts
and other liabilities of the Corporation and the preferential amounts
to which the holders of any stock ranking prior to the Common Stock in
the distribution of assets shall be entitled upon liquidation, the
holders of the Common Stock and the holders of any other stock ranking
on a parity with the Common Stock in the distribution of assets upon
liquidation shall be entitled to share in the remaining assets of the
Corporation according to their respective interests.
II. Preferred Stock
The Preferred Stock may be issued from time to time in one or more
series. All shares of any one series of Preferred Stock shall be
identical except as to the dates of issue and the dates from which
dividends on shares of the same series issued on different dates shall
cumulate (if cumulative). Subject to the Certificate of Incorporation,
authority is expressly granted to the Board of Directors to authorize
the issue of one or more series of Preferred Stock, and to fix by
resolution or resolutions providing for the issue of each such series
the voting powers, designations, preferences and relative,
participating, optional or other special rights, and qualifications,
limitations or restrictions thereof, of such series, to the full extent
now or hereafter permitted by law, including but not limited to the
following:
(a) the distinctive designations of such series and the
number of shares which shall constitute such series, which number may
be increased (except where otherwise provided by the Board of Directors
in creating such series) or decreased (but not below the number of
shares thereof then outstanding) from time to time by action of the
Board of Directors;
(b) the dividend rights of such series, the extent, if any,
to which such dividends shall be cumulative, the conditions upon which
and/or the dates when such dividends shall be payable and the date from
which dividends on cumulative series shall accrue and be cumulative;
provided that accumulated dividends shall not bear interest;
(c) whether such series shall be redeemable and, if so, the
terms and conditions of such redemption, including the time or times
when and the price or prices at which shares of such series shall be
redeemed;
(d) the rights of such series in the event of liquidation,
dissolution or winding up of the Corporation (consolidation or merger
of the Corporation with or into one or more other corporations or a
sale, lease or exchange of all or substantially all of the assets of
the Corporation shall not be deemed to be a liquidation, dissolution or
winding up, within the meaning of this Article FOURTH);
(e) the terms and conditions, if any, upon which the shares
of such series shall be convertible into or exchangeable for shares of
any other series, class or classes, or any other securities, to the
full extent now or hereafter permitted by law; and
(f) whether such series shall have any voting rights in
addition to those prescribed by law and, if so, the terms and
conditions of exercise of such voting rights.
No holder of any shares of Preferred Stock of any series shall
have any preemptive right whatsoever to purchase or subscribe for any
additional shares of Preferred Stock of any series or any shares of any
other class of stock or bonds, certificates of indebtedness,
debentures, warrants, options or other securities convertible into or
carrying any right to purchase or subscribe for any shares of stock or
any class.
FIFTH: The amount of capital with which the Corporation will
commence business is One Thousand Dollars ($1,000.00).
SIXTH: The names and places of residence of the incorporators
are as follows:
NAMES RESIDENCES
L. H. Herman Wilmington, Delaware
Walter Lenz Wilmington, Delaware
W. T. Hobson Wilmington, Delaware
SEVENTH: The Corporation is to have perpetual existence.
EIGHTH: The Board of Directors is expressly authorized and
empowered to make, alter, amend and repeal the by-laws, subject to the
power of the stockholders to alter or repeal the by-laws made by the
Board of Directors.
TENTH: In furtherance, and not in limitation of the powers
conferred by stature, the Board of Directors is expressly authorized:
To authorize and cause to be executed mortgages and liens upon the
real and personal property of the Corporation.
To set apart out of any of the funds of the Corporation available
for dividends a reserve or reserves for any proper purpose or to
abolish any such reserve in the manner in which it was created.
By resolution or resolutions, passed by a majority of the whole
board to designate one or more committees, each committee to consist of
two or more of the directors of the Corporation, which, to the extent
provided in said resolution or resolutions or in the by-laws of the
Corporation, shall have and may exercise the powers of the Board of
Directors in the management of the business and affairs of the
Corporation and may have power to authorize the seal of the Corporation
to be affixed to all papers which may require it. Such committee or
committees shall have such name or names as may be stated in the by-
laws of the Corporation or as may be determined from time to time by
resolution adopted by the Board of Directors.
When and as authorized by the affirmative vote of the holders of
a majority of the sock issued and outstanding having voting power given
at a stockholders' meeting duly called for that purpose, or when
authorized by the written consent of the holders of a majority of the
voting stock issued and outstanding, to sell, lease or exchange all of
the property and assets of the Corporation, including its good will and
its corporate franchises, upon such terms and conditions and for such
consideration, which may be in whole or in part shares of stock in,
and/or other securities of, any other corporation or corporations, as
its Board of Directors shall deem expedient and for the best interests
of the Corporation.
The Corporation may in its by-laws confer powers upon its Board of
Directors in addition to the foregoing, and in addition to the powers
and authorities expressly conferred upon it by statute.
ELEVENTH: Whenever a compromise or arrangement is proposed between
this Corporation and its creditors or any class of them and/or between
this Corporation and its stockholders or any class of them, any court
of equitable jurisdiction within the State of Delaware may, on the
application in a summary way of this Corporation or of any creditor or
stockholder thereof, or on the application of any receiver or receivers
appointed for this Corporation under the provisions of Section 3883 of
the Revised Code of 1915 of said State, or on the application of
trustees in dissolution or of any receiver or receivers appointed for
this Corporation under the provisions of Section 43 of the General
Corporation Law of the State of Delaware, order a meeting of the
creditors or class of creditors, and/or of the stockholders or class of
stockholders of this Corporation, as the case may be, to be summoned in
such manner as the said Court directs. If a majority in number
representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
Corporation, as the case may be, agree to any compromise or arrangement
and to any reorganization of this Corporation as consequence of such
compromise or arrangement, the said compromise or arrangement and the
said reorganization shall, if sanctioned by the Court to which the said
application has been made, be biding on all the creditors or class of
creditors, and/or on all the stockholders or class of stockholders, of
this Corporation, as the case may be, and also on this Corporation.
TWELFTH: Both stockholders and directors shall have power, if the
by-laws so provide, to hold their meetings, and to have one or more
offices within or without the State of Delaware, and to keep the books
of this Corporation (subject to the provisions of the statues), outside
the State of Delaware at such places as may be from time to time
designated by the Board of Directors.
THIRTEENTH: No contract or other transaction between the
Corporation and any other corporation and no act of the Corporation
shall in any way be affected or invalidated by the fact that any of the
directors of the Corporation are pecuniarily or otherwise interested
in, or are directors or officers of, such other corporation; any
directors individually, or any firm of which any director may be a
member, may be a party to, or may be pecuniarily or otherwise
interested in, any contract or transaction of the Corporation, provided
that the fact that he or such firm is so interested shall be disclosed
or shall have been known to the Board of Directors or a majority
thereof; and any director of the Corporation who is also a director or
officer of such other corporation or who is so interested may be
counted in determining the existence of a quorum at any meeting of the
Board of Directors of the Corporation which shall authorize any such
contract or transaction and may bote thereat to authorize any such
contract or transaction with like force and effect as if he were not
such director or officer of such other corporation or not so
interested.
FOURTEENTH: The Corporation reserves the right to amend, alter,
change or repeal any provision contained in this Certificate of
Incorporation, in the manner now or hereafter prescribed by statute,
and all rights conferred upon stockholders herein are granted subject
to this reservation.
FIFTEENTH: No stockholder shall have any preemptive right to
subscribe to, purchase, or otherwise acquire any shares of stock,
rights, options, bonds, securities, or obligations of the Corporation
of any class or series, and any such preemptive right in existence
prior to the effective date of the amendment whereby this Article
FIFTEENTH has been added to the Certificate of Incorporation is hereby
expressly terminated.
SIXTEENTH: No director of the Corporation shall be personally
liable to the Corporation or its stockholders for monetary damages for
any breach of fiduciary duty as a director, except that this Article
SIXTEENTH, does not eliminate or limit the liability of a director (i)
for any breach of the director's duty of 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, as same exists or hereafter may be amended, or (iv) for any
transaction from which the director derived an improper personal
benefit. No amendment to or repeal of this Article SIXTEENTH, or
adoption of any provision of this Certificate of Incorporation
inconsistent with this Article SIXTEENTH, shall prejudice the
exculpatory effect of this Article SIXTEENTH with respect to any act or
omission occurring prior to the effective date of such amendment,
repeal or inconsistent provision.
Signed and attested to on May 1, 1987.
Marshall Tulin, President
Attest:
Andrew C. Corsini, Secretary
CERTIFICATE OF DESIGNATION,
PREFERENCES AND RIGHTS OF SERIES C
PARTICIPATING PREFERRED STOCK
of
SWANK, INC.
Pursuant to Section 151 of the Corporation Law
of the State of Delaware
We, John Tulin, Executive Vice President, and Andrew C. Corsini,
Secretary of SWANK, INC., a corporation organized and existing under
the General Corporation Law of the State of Delaware (the
"Corporation"), in accordance with the provisions of Section 151
thereof, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors by the Restated Certificate of Incorporation of the said
Corporation, the said Board of Directors on September 28, 1987,
adopted the following resolution creating a series of Series C
Participating Preferred Stock:
RESOLVED, that pursuant to the authority vested in the
Board of Directors of this Corporation in accordance with the
provisions of its Restated Certificate of Incorporation, a
series of Preferred Stock of the Corporation be and hereby is
created, and that the designation and amount thereof and the
voting rights, preferences, privileges, qualifications,
limitations, conversion rights, restrictions and relative,
participating, optional and other special rights of the
shares of such series are as follows:
SECTION 1. Designation and Amount. The shares of such
series shall be designated as "Series C Participating
Preferred Stock" (the "Series C Participating Stock"). The
number of shares constituting such series shall be as
follows:
Series Number of Shares
Series C Participating
Preferred Stock 160,000
SECTION 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock
ranking prior and superior to the shares of Series C
Participating Stock with respect to dividends, the holders of
shares of Series C Participating Stock, in preference to the
holders of Common Stock and of any other junior stock, shall
be entitled to receive, when, as and if declared by the Board
of Directors out of funds legally available for the purpose,
quarterly dividends payable in cash on the first day of
February, May, August and November in each year (each such
date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction
of a share of such Series C Participating Stock, in an amount
per share (rounded to the nearest cent) equal to the greater
of (a) $1 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share
amount of all cash dividends and 100 times the aggregate per
share amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend or distribution
payable in shares of Common Stock, par value $1.00 per share
(the "Common Stock"), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date or,
with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share
of such Series C Participating Stock. In the event the
Corporation shall at any time declare or pay any dividend on
Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common
Stock, otherwise than pursuant to the Recapitalization (as
hereinafter defined), then in each such case the amount to
which holders of shares of Series C Participating Stock were
entitled immediately prior to such event under clause (b) of
the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or
distribution on the Series C Participating Stock as provided
in paragraph (A) of this Section immediately after it
declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock);
provided that, in the event no dividend or distribution shall
have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $1
per share on the Series C Participating Stock shall
nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(C) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series C Participating Stock from
the Quarterly Dividend Payment Date next preceding the date
if issue of such shares of Series C Participating Stock,
unless the date of issue of such shares is prior to the
record date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to accrue
from the date if issue of such shares, or unless the date if
issue is a Quarterly Dividend Payment Date or is a date after
the record date for the determination of holders of shares of
Series C Participating Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in
either of which events such dividends shall begin to accrue
and be cumulative from such Quarterly Dividend Payment Date.
Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Series C Participating Stock
in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may
fix a record date for the determination of holders of shares
of Series C Participating Stock entitled to receive payment
of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed
for the payment thereof.
SECTION 3. Voting Rights. The holders of shares of
Series C Participating Stock shall have the following voting
rights:
(A) Subject to the provision for adjustment hereinafter
set forth, each share of Series C Participating Stock shall
entitle the holder thereof to 100 votes on all matters
submitted to a vote of the stockholders of the Corporation.
In the event the Corporation shall at any time, when any
shares of Series C Participating Stock are outstanding,
declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend
in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the number of
votes per share to which holders of shares of Series C
Participating Stock were entitled immediately prior to such
event shall be adjusted by multiplying such number by a
fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the
holders of shares of Series C Participating Stock and the
holders of shares of Common Stock shall vote together as one
class on all matters submitted to a vote of stockholders of
the Corporation.
(C) Except as set forth herein, holders of Series C
Participating Stock shall have no special voting rights and
their consent shall not be required (except to the extent
they are entitled to vote with holders of Common Stock as set
forth herein) for taking any corporate action.
SECTION 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series C Participating Stock as
provided in Section 2 are in arrears, thereafter and until
all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series C Participating Stock
outstanding shall have been paid in full, the Corporation
shall not:
(i) declare or pay dividends on, make any other
distributions on, any shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution
or winding up) to the Series C Participating Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution
or winding up) with the Series C Participating Stock,
except dividends paid ratably on the Series C
Participating Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares
are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either
as to dividends or upon liquidation, dissolution or
winding up) to the Series C Participating Stock,
provided that the Corporation may at any time redeem,
purchase or otherwise acquire shares of any such junior
stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or
upon dissolution, liquidation or winding up) to the
Series C Participating Stock; or
(iv) purchase or otherwise acquire for
consideration any shares of Series C Participating
Stock, or any shares of stock ranking on a parity with
the Series C Participating Stock, except in accordance
with a purchase offer made in writing or by publication
(as determined by the Board of Directors) to all holders
of such shares upon such terms as the Board of
Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences
of the respective series and classes, shall determine in
good faith will result in fair and equitable treatment
among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless
the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in
such manner.
SECTION 5. Reacquired Shares. Any Shares of Series C
Participating Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall, upon their cancellation, become authorized but
unissued shares of preferred stock and may be reissued as
part of a new series of preferred stock to be created by
resolution or resolutions of the Board of Directors, subject
to the conditions and restrictions on issuance set forth
herein.
SECTION 6. Liquidation, Dissolution or Winding Up.
Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (1) to the holders
of shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series C
Participating Stock unless, prior thereto, the holders of
shares of Series C Participating Stock shall have received an
amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared to the date of
such payment, plus an amount equal to the greater of (a) $100
per share, or (b) an aggregate amount per share, subject to
the provision for adjustment hereinafter set forth, equal to
100 times the aggregate amount to be distributed per share to
holders of Common Stock, or (2) to the holders of stock
ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series C
Participating Stock, except distributions made ratably on the
Series C Participating Stock and all other such parity stock
in proportion to the total amounts to which the holders of
all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation
shall at any time, when any shares of Series C Participating
Stock are outstanding, declare or pay any dividend on Common
Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common
Stock or the Recapitalization) into a greater or lesser
number of shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of Series C
Participating Stock were entitled immediately prior to such
event under the proviso in clause (1) of the preceding
sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
SECTION 7. Consolidation or Merger. In case the
Corporation shall enter into any consolidation or merger in
which the shares of Common Stock are exchanged for or changed
into other stock or securities, cash and/or other property,
then in any such case the shares of Series C Participating
Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for
adjustment hereinafter set forth) equal to 100 times the
aggregate amount of stock, securities, cash and/or any other
property (payable in kind), as the case may be, into which or
for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time, when any
shares of Series C Participating Stock are outstanding,
declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise) into a greater or lesser
number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to
the exchange or change of shares of Series C Participating
Stock shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
SECTION 8. Redemption. The outstanding shares of
Series C Participating Stock may be redeemed at the option
only of the Corporation in whole, but not in part, at any
time, without notice, at a redemption price (the "Redemption
Price") of $5,050 per share. Upon consummation of the
recapitalization of the Corporation approved by its Board of
Directors on September 28, 1987 as the same may be amended or
modified (the "Recapitalization"), the Redemption Price for
each outstanding share of Series C Participating Stock shall
be adjusted, and shall be determined by multiplying $5,050 by
a fraction, the numerator of which shall be the number of
shares of Common Stock issued and outstanding immediately
before giving effect to the transactions contemplated in the
Recapitalization, and the denominator of which shall be the
number of shares of Common Stock which shall be issued and
outstanding immediately following the transaction
contemplated in the Recapitalization. At the time of
redemption specified in the resolution of the Board of
Directors authorizing such redemption, the rights of the
holders of Series C Participating Stock redeemed shall cease,
except for the right to receive the Redemption Price, without
interest. Notwithstanding any provision contained herein to
the contrary, no accrued dividends will be paid on the shares
of Series C Participating Stock upon redemption.
IN WITNESS WHEREOF, this Certificate of Designation has been
executed on behalf of the Corporation by its Executive Vice President
and attested by its Secretary this 23rd day of October, 1987.
John Tulin,
Executive Vice President
ATTEST:
Andrew C. Corsini, Secretary
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF
SERIES A PARTICIPATING STOCK
AND SERIES B PARTICIPATING PREFERRED STOCK
OF
SWANK, INC.
Pursuant to Section 151 of the Corporation Law
of the State of Delaware
We, Marshall Tulin, President, and Andrew C. Corsini, Secretary,
of SWANK, INC., a corporation organized and existing under the General
Corporation Law of the State of Delaware (the "Corporation"), in
accordance with the provisions of Section 151 thereof, DO HEREBY
CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors by the Restated Certificate of Incorporation of the said
Corporation, the said Board of Directors on September 28, 1987,
adopted the following resolution creating a series of Series A
Participating Preferred Stock and a series of Series B
Participating Preferred Stock:
RESOLVED, that pursuant to the authority vested in the
Board of Directors of this Corporation in accordance with the
provision of its Restated Certificate of Incorporation, two
series of Preferred Stock of the Corporation be and hereby
are created, and that the designations and amounts thereof
and the voting rights, preferences, privileges,
qualifications, limitations, conversions rights, restrictions
and relative, participating, optional and other special
rights of the shares of such series are as follows:
SECTION 1. Designation and Amount. The shares of such
series shall be designated as "Series A Participating
Preferred Stock" (the "Series A Participating Stock) and
"Series B Participating Preferred Stock" (the "Series B
Participating Stock") (collectively, the "Participating
Stock"). The number of shares constituting such series shall
be as follows:
Number of
Series Shares
Series A Participating Preferred Stock.......... 12,000
Series B Participating Preferred Stock.......... 24,000
The powers, preferences and rights of each series of
Participating Stock shall be identical except as set forth
herein.
SECTION 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to
the shares of Participating Stock with respect to dividends, the
holders of shares of each series of Participating Stock, in preference
to the holders of Common Stock and of any other junior stock, shall be
entitled to receive, when, as and if declared by the Board of Directors
out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of February, May, August and November
in each year (each such date being referred to herein as a "Quarterly
Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment date after the first issuance of a share or fraction of a share
of such series of Participating Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $1 or (b) subject to
the provision for adjustment hereinafter set forth, 100 times the
aggregate per share amount of all cash dividends, and 100 times the
aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions other than a dividend payable in shares of
Common Stock, par value $1.00 per share, or Common Stock, par value
$.10 per share of the Corporation (collectively, the "Common Stock") or
a subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date or, with respect
to the first Quarterly Dividend Payment Date, since the first issuance
of any share or fraction of a share of such series of Participating
Stock. In the event the Corporation shall at any time declare or pay
any dividend on Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the
amount to which holders of shares of Participating Stock were entitled
immediately prior to such event under clause (b) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction he
numerator of which is the number of shares of Common Stock that were
outstanding immediately after such event and the denominator of which
is the number of shares of Common Stock that were outstanding
immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Participating Stock as provided in paragraph (A) of this Section
immediately after it declares a dividend or distribution on the Common
Stock (other than a dividend payable in shares of Common Stock);
provided that, in the event no dividend or distribution shall have been
declared on the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly Dividend
Payment Date a dividend of $1 per share on the Participating Stock
shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Participating Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of
Participating Stock, unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to accrue from the date
of issue of such shares, or unless the date of issue is a Quarterly
Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Participating Stock entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall begin to accrue
and be cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid on the
shares of Participating Stock in an amount less than the total amount
of such dividends at the time accrued and payable on such shares shall
be allocated pro rata on a share-by-share basis among all such shares
at the time outstanding. The Board of Directors may fix a record date
for the determination of holders of shares of Participating Stock
entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be not more than 60 days prior to the
date fixed for the payment thereof.
SECTION 3. Voting Rights. The holders of shares of Participating
Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Participating Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation
shall at any time declare or pay any dividend on Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the
number of votes per share to which holders of shares of
Participating Stock were entitled immediately prior to such event
shall be adjusted by multiplying such number by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the
holders of shares of Participating Stock and the holders of shares
of Common Stock shall vote together as one class on all matters
submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, holders of Participating
Stock shall have no special voting rights and their consent shall
not be required (except to the extent they are entitled to vote
with holders of Common Stock as set forth herein) for taking any
corporate action.
SECTION 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Participating Stock as provided in Section
2 are in arrears, thereafter and until all accrued and unpaid dividends
and distributions, whether or not declared, on shares of Participating
Stock outstanding shall have been paid in full, the Corporation shall
not:
(i) declare or pay dividends on, make any other distributions
on, any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Participating
Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking or a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Participating Stock, except dividends paid ratably on the
Participating Stock and all such parity stock on which dividends
are payable or in arrears in proportion to the total amounts to
which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Participating Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such junior
stock in exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Participating Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Participating Stock, or any shares of stock ranking on
a parity with the Participating Stock, except in accordance with
a purchase offer made in writing or by publication (as determined
by the Board of Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights and
preferences of the respective series and classes, shall determine
in good faith will result in fair and equitable treatment among
the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
SECTION 5. Reacquired Shares. Any Shares of Participating Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the
acquisition thereof. All such shares shall, upon their cancellation,
become authorized but unissued shares of preferred stock and may be
reissued as part of a new series of preferred stock to be created by
resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.
SECTION 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution
or winding up) to the Participating Stock unless, prior thereto, the
holders of shares of Participating Stock shall have received $100 per
share, plus an amount equal to accrued an unpaid dividends and
distributions thereon, whether or not declared, to the date of such
payment, provided that the holders of shares of Participating Stock
shall be entitled to receive an aggregate amount per share, subject to
the provision for adjustment hereinafter set forth, equal to 100 times
the aggregate amount to be distributed per share to holders of Common
Stock, or (2) to the holders of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Participating Stock, except distributions made ratably on the
Participating Stock and all other such parity stock in proportion to
the total amounts to which the holders of all such shares are entitled
upon such liquidation, dissolution or winding up. In the event the
Corporation shall at any time declare or pay any dividend on Common
Stock payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of common Stock
(by reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the aggregate amount to which
holders of shares of Participating Stock were entitled immediately
prior to such event under the proviso in clause (1) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and he denominator of which is the number
os shares of Common Stock that were outstanding immediately prior to
such event.
SECTION 7. Consolidation or Merger. In case the Corporation
shall enter into any consolidation or merger in which the shares of
Common Stock are exchanged for or changed into other stock or
securities, cash and/or other property, then in any such case the
shares of Participating Stock shall at the same time be similarly
exchanged or changed in an amount per share (subject to the provision
for adjustment hereinafter set forth) equal to 100 times the aggregate
amount of stock, securities cash and/or any other property (payable in
kind), as the case may be, into which or for which each share of Common
Stock is changed or exchanged. In the event the Corporation shall at
any time declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the amount set forth in
the preceding sentence with respect to the exchange or change of shares
of Participating Stock shall be adjusted by multiplying such amount by
a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
SECTION 8. Redemption. The outstanding shares of each of the
series of Participating Stock may be redeemed at the option only of the
Corporation in whole, but not in part, at any time, without notice, at
a redemption price (the "Redemption Price") of $1,700 per share. At
the time of redemption specified in the resolution of the Board of
Directors authorizing such redemption, the rights of the holders of the
series of Participating Stock redeemed shall cease, except for the
right to receive the Redemption Price, without interest.
Notwithstanding any provision contained herein to the contrary, no
accrued dividends will be paid on the shares of Participating Stock
upon redemption.
IN WITNESS WHEREOF, this Certificate of Designation has been
executed on behalf of the Corporation by its President and attested by
its Secretary this 29th day of January, 1988.
Marshall Tulin, President
ATTEST:
Andrew C. Corsini, Secretary
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
SWANK, INC.
(Pursuant to Section 242)
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"Corporation") is SWANK, INC.
2. The First Paragraph of Article FOURTH of the restated
certificate of incorporation of the Corporation is hereby amended to
read as follows:
FOURTH: The total number of shares of capital
stock which the Corporation shall have authority to issue
is 67,000,000 shares, consisting of 66,000,000 shares of
Common Stock, par value $.10 per share, and 1,000,000
shares of Preferred Stock, par value $1.00 per share.
Effective upon this filing of this certificate of
amendment to the Corporation's Restated Certificate of
Incorporation (i) each outstanding share of Common Stock,
$1.00 par value, of the Corporation shall be reclassified
as, and converted into, one share of Common Stock, par
value $.10 per share, of the Corporation (the "New
Shares") and one one-hundredth of a share of Series B
Participating Preferred Stock, $1.00 par value, of the
Corporation; (ii) each outstanding one one-hundredth of
a share of Series A Participating Preferred Stock, par
value $1.00 per share, of the Corporation shall be
reclassified as, and converted into one New Share plus an
additional number of New Shares equal to the quotient of
$17 divided by the median of the daily closing sales
price of the New Shares or if no New Shares are traded on
a trading day the last bid price for the New Shares as
reported on the New York Stock Exchange Composite Tape or
if the New Shares are not listed on the New York Stock
Exchange Composite Tape on a trading day, the mean
between the highest bid and lowest asked price of the New
Shares as quoted by the National Association of
Securities Dealers Automated Quotation System ("NASDAQ")
for such trading day or if the New Shares are not quoted
on the NASDAQ, the mean between the highest bid and the
lowest asked price for such trading day as supplied by
Reporting Broker Dealers for the 20 trading days
following the date on which the Effective Time occurs.
Upon consummation of the reclassification of the capital
stock of the Corporation set forth in this paragraph, the
holders of shares of capital stock of the Corporation
shall have all of the rights accorded to them by law and
by the Plan of Recapitalization, as amended, dated as of
September 28, 1987, of the Corporation.
3. The amendment of the certificate of incorporation herein
certified have been duly adopted in accordance with the provisions of
Sections 242 of the General Corporation Law of the State of Delaware.
Signed and attested to on February 29, 1988.
John Tulin, Executive Vice President
Attest:
Andrew C. Corsini, Secretary
CERTIFICATE OF AMENDMENT OF RESTATED CERTIFICATE OF INCORPORATION
-of-
SWANK, INC.
It is hereby certified that:
1. The name of the corporation (hereinafter called the
"Corporation") is Swank, Inc.
2. The restated certificate of incorporation of the Corporation,
as amended to date, is hereby amended, in order to reduce the number of
authorized shares of capital stock of the Corporation from 67,000,000
shares to 44,000,000 shares and to reduce the number of authorized
shares of Common Stock of the Corporation from 66,000,000 shares to
43,000,000 shares, by striking out the first paragraph of ARTICLE
FOURTH thereof and by substituting in lieu of the first paragraph of
said ARTICLE the following new paragraph:
"FOURTH: The total number of shares of capital stock
which the Corporation shall have authority to issue is
44,000,000 shares, consisting of 43,000,000 shares of
Common Stock, $.10 par value per share, and 1,000,000
shares of Preferred Stock, $1.00 par value per share."
3. The amendment of the restated certificate of incorporation of
the Corporation, as amended to date, herein certified has been duly
adopted in accordance with the provisions of Section 242 of the General
Corporation Law of the State of Delaware.
Signed on April 21, 1995.
John A. Tulin, Executive Vice President
10Q\certinc
SWANK, INC.
1994 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION CONTRACT
THIS NON-QUALIFIED STOCK OPTION CONTRACT entered into as of
the 20th day of April 1995, between Swank, Inc., a Delaware
corporation (the "Company"), and Raymond Vise (the
"Optionee").
W I T N E S S E T H
1. The Company, in accordance with the terms and conditions
of the 1994 Non-Employee Director Stock Option Plan of the Company
(the "Plan"), grants as of April 20, 1995 to the Optionee an option
to purchase an aggregate of 5,000 shares of the Common Stock, $.10
par value per share, of the Company ("Common Stock"), at $1.28125
per share, being 100% of the fair market value of such shares of
Common Stock on such date.
2. The term of this option shall be 5 years from April 20,
1995, subject to earlier termination as provided in this Contract
and in the Plan. This option shall be immediately exercisable as
to 100% of the number of shares of Common Stock subject hereto.
3. This option shall be exercised by giving written notice
to the Company at its principal office, presently 6 Hazel Street,
Attleboro, Massachusetts 02703-0962, Attention: Treasurer, stating
that the Optionee is exercising this stock option, specifying the
number of shares being purchased and accompanied by payment in full
of the aggregate purchase price thereof in cash or by check. In no
event may a fraction of a share of Common Stock be purchased under
this option.
4. Notwithstanding the foregoing, and without limiting the
provisions of paragraph 11 of the Plan, this option shall not be
exercisable by the Optionee unless (a) a registration statement
under the Securities Act of 1933, as amended (the "Securities Act")
with respect to the shares of Common stock to be received upon the
exercise of the option shall be effective and current at the time
of exercise or (b) there is an exemption from registration under
the Securities Act for the issuance of the shares of Common Stock
upon exercise. At the request of the Board of Directors, the
Optionee shall execute and deliver to the Company his
representation and warranty, in form and substance satisfactory to
the Board of Directors, that the shares of Common Stock to be
issued upon the exercise of the option are being acquired by the
Optionee for his own account, for investment only and not with a
view to the resale or distribution thereof without the meaning of
the Securities Act. Nothing herein shall be construed so as to
obligate the Company to register the shares subject to the option
under the Securities Act.
-1-
5. Notwithstanding anything herein to the contrary, if at
any time the Board of Directors shall determine, in its discretion,
that the listing or qualification of the shares of Common Stock
subject to this option on any securities exchange or under any
applicable law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in
connection with, the granting of an option, or the issue of shares
of Common Stock thereunder, this option may not be exercised in
whole or in part unless such listing, qualification, consent or
approval shall have been effected or obtained free of any
conditions not acceptable to the Board of Directors, in its
discretion.
6. Nothing in the Plan or herein shall confer upon the
Optionee any right to continue as a director of the Company.
7. The Company may endorse or affix appropriate legends upon
the certificates for shares of Common Stock issued upon exercise of
this option and may issue such "stop transfer" instructions to its
transfer agent in respect of such shares as it determines, in its
discretion, to be necessary or appropriate to (a) prevent a
violation of, or to perfect an exemption from, the registration
requirement of the Securities Act, or (b) implement the provisions
of the Plan or any agreement between the Company and the Optionee
with respect to such shares of Common Stock.
8. The Company and the Optionee agree that they will both be
subject to and bound by all of the terms and conditions of the
Plan, a copy of which is attached hereto and made part hereof. In
the event the Optionee is no longer a director of the Company or in
the event of his death or disability (as defined in the Plan), his
rights hereunder shall be governed by and be subject to the
provisions of the Plan. In the event of a conflict between the
terms of this Contract and the terms of the Plan, the terms of the
Plan shall govern.
9. The Optionee represents and agrees that he will comply
with all applicable laws relating to the Plan and the grant and
exercise of the option and the disposition of the shares of Common
Stock acquired upon exercise of the option, including without
limitation, federal state securities and "blue sky" laws.
10. This option is not transferrable otherwise than by will
or the laws of descent and distribution and may be exercised,
during the lifetime of the Optionee, only by him or his legal
representatives.
11. This Contract shall be binding upon and inure to the
benefit of any successor or assign of the Company and to any heir,
distributee, executor, administrator or legal representative
entitled under the Plan and by law to the Optionee's rights
hereunder.
-2-
12. This Contract shall be governed by and construed in
accordance with the laws of the State of Delaware.
13. The invalidity or illegality of any provision herein
shall not affect the validity of any other provision.
14. The Optionee agrees that the Company may amend the Plan
and the options granted to the Optionee under the Plan, subject to
the limitations contained in the Plan
IN WITNESS WHEREOF, the parties hereto have executed this
contract as of the day and year first above written.
SWANK, INC.
By: /s/ Marshall Tulin
Its: President
/s/ Raymond Vise
Optionee
8 El Paseo
Address
Irvine, CA 92715
10q/95dirop1
-3-
SWANK, INC.
1994 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION CONTRACT
THIS NON-QUALIFIED STOCK OPTION CONTRACT entered into as of
the 20th day of April 1995, between Swank, Inc., a Delaware
corporation (the "Company"), and William B. MacLeod (the
"Optionee").
W I T N E S S E T H
1. The Company, in accordance with the terms and conditions
of the 1994 Non-Employee Director Stock Option Plan of the Company
(the "Plan"), grants as of April 20, 1995 to the Optionee an option
to purchase an aggregate of 5,000 shares of the Common Stock, $.10
par value per share, of the Company ("Common Stock"), at $1.28125
per share, being 100% of the fair market value of such shares of
Common Stock on such date.
2. The term of this option shall be 5 years from April 20,
1995, subject to earlier termination as provided in this Contract
and in the Plan. This option shall be immediately exercisable as
to 100% of the number of shares of Common Stock subject hereto.
3. This option shall be exercised by giving written notice
to the Company at its principal office, presently 6 Hazel Street,
Attleboro, Massachusetts 02703-0962, Attention: Treasurer, stating
that the Optionee is exercising this stock option, specifying the
number of shares being purchased and accompanied by payment in full
of the aggregate purchase price thereof in cash or by check. In no
event may a fraction of a share of Common Stock be purchased under
this option.
4. Notwithstanding the foregoing, and without limiting the
provisions of paragraph 11 of the Plan, this option shall not be
exercisable by the Optionee unless (a) a registration statement
under the Securities Act of 1933, as amended (the "Securities Act")
with respect to the shares of Common stock to be received upon the
exercise of the option shall be effective and current at the time
of exercise or (b) there is an exemption from registration under
the Securities Act for the issuance of the shares of Common Stock
upon exercise. At the request of the Board of Directors, the
Optionee shall execute and deliver to the Company his
representation and warranty, in form and substance satisfactory to
the Board of Directors, that the shares of Common Stock to be
issued upon the exercise of the option are being acquired by the
Optionee for his own account, for investment only and not with a
view to the resale or distribution thereof without the meaning of
the Securities Act. Nothing herein shall be construed so as to
obligate the Company to register the shares subject to the option
under the Securities Act.
-1-
5. Notwithstanding anything herein to the contrary, if at
any time the Board of Directors shall determine, in its discretion,
that the listing or qualification of the shares of Common Stock
subject to this option on any securities exchange or under any
applicable law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in
connection with, the granting of an option, or the issue of shares
of Common Stock thereunder, this option may not be exercised in
whole or in part unless such listing, qualification, consent or
approval shall have been effected or obtained free of any
conditions not acceptable to the Board of Directors, in its
discretion.
6. Nothing in the Plan or herein shall confer upon the
Optionee any right to continue as a director of the Company.
7. The Company may endorse or affix appropriate legends upon
the certificates for shares of Common Stock issued upon exercise of
this option and may issue such "stop transfer" instructions to its
transfer agent in respect of such shares as it determines, in its
discretion, to be necessary or appropriate to (a) prevent a
violation of, or to perfect an exemption from, the registration
requirement of the Securities Act, or (b) implement the provisions
of the Plan or any agreement between the Company and the Optionee
with respect to such shares of Common Stock.
8. The Company and the Optionee agree that they will both be
subject to and bound by all of the terms and conditions of the
Plan, a copy of which is attached hereto and made part hereof. In
the event the Optionee is no longer a director of the Company or in
the event of his death or disability (as defined in the Plan), his
rights hereunder shall be governed by and be subject to the
provisions of the Plan. In the event of a conflict between the
terms of this Contract and the terms of the Plan, the terms of the
Plan shall govern.
9. The Optionee represents and agrees that he will comply
with all applicable laws relating to the Plan and the grant and
exercise of the option and the disposition of the shares of Common
Stock acquired upon exercise of the option, including without
limitation, federal state securities and "blue sky" laws.
10. This option is not transferrable otherwise than by will
or the laws of descent and distribution and may be exercised,
during the lifetime of the Optionee, only by him or his legal
representatives.
11. This Contract shall be binding upon and inure to the
benefit of any successor or assign of the Company and to any heir,
distributee, executor, administrator or legal representative
entitled under the Plan and by law to the Optionee's rights
hereunder.
-2-
12. This Contract shall be governed by and construed in
accordance with the laws of the State of Delaware.
13. The invalidity or illegality of any provision herein
shall not affect the validity of any other provision.
14. The Optionee agrees that the Company may amend the Plan
and the options granted to the Optionee under the Plan, subject to
the limitations contained in the Plan
IN WITNESS WHEREOF, the parties hereto have executed this
contract as of the day and year first above written.
SWANK, INC.
By: /s/ Marshall Tulin
Its: President
/s/ William B. MacLeod
Optionee
2000 S. Ocean Blvd. #605
Address
Delray Beach, FL 33483
10q/95dirop2
-3-
SWANK, INC.
1994 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION CONTRACT
THIS NON-QUALIFIED STOCK OPTION CONTRACT entered into as of
the 20th day of April 1995, between Swank, Inc., a Delaware
corporation (the "Company"), and Mark Abramowitz (the
"Optionee").
W I T N E S S E T H
1. The Company, in accordance with the terms and conditions
of the 1994 Non-Employee Director Stock Option Plan of the Company
(the "Plan"), grants as of April 20, 1995 to the Optionee an option
to purchase an aggregate of 5,000 shares of the Common Stock, $.10
par value per share, of the Company ("Common Stock"), at $1.28125
per share, being 100% of the fair market value of such shares of
Common Stock on such date.
2. The term of this option shall be 5 years from April 20,
1995, subject to earlier termination as provided in this Contract
and in the Plan. This option shall be immediately exercisable as
to 100% of the number of shares of Common Stock subject hereto.
3. This option shall be exercised by giving written notice
to the Company at its principal office, presently 6 Hazel Street,
Attleboro, Massachusetts 02703-0962, Attention: Treasurer, stating
that the Optionee is exercising this stock option, specifying the
number of shares being purchased and accompanied by payment in full
of the aggregate purchase price thereof in cash or by check. In no
event may a fraction of a share of Common Stock be purchased under
this option.
4. Notwithstanding the foregoing, and without limiting the
provisions of paragraph 11 of the Plan, this option shall not be
exercisable by the Optionee unless (a) a registration statement
under the Securities Act of 1933, as amended (the "Securities Act")
with respect to the shares of Common stock to be received upon the
exercise of the option shall be effective and current at the time
of exercise or (b) there is an exemption from registration under
the Securities Act for the issuance of the shares of Common Stock
upon exercise. At the request of the Board of Directors, the
Optionee shall execute and deliver to the Company his
representation and warranty, in form and substance satisfactory to
the Board of Directors, that the shares of Common Stock to be
issued upon the exercise of the option are being acquired by the
Optionee for his own account, for investment only and not with a
view to the resale or distribution thereof without the meaning of
the Securities Act. Nothing herein shall be construed so as to
obligate the Company to register the shares subject to the option
under the Securities Act.
-1-
5. Notwithstanding anything herein to the contrary, if at
any time the Board of Directors shall determine, in its discretion,
that the listing or qualification of the shares of Common Stock
subject to this option on any securities exchange or under any
applicable law, or the consent or approval of any governmental
regulatory body, is necessary or desirable as a condition of, or in
connection with, the granting of an option, or the issue of shares
of Common Stock thereunder, this option may not be exercised in
whole or in part unless such listing, qualification, consent or
approval shall have been effected or obtained free of any
conditions not acceptable to the Board of Directors, in its
discretion.
6. Nothing in the Plan or herein shall confer upon the
Optionee any right to continue as a director of the Company.
7. The Company may endorse or affix appropriate legends upon
the certificates for shares of Common Stock issued upon exercise of
this option and may issue such "stop transfer" instructions to its
transfer agent in respect of such shares as it determines, in its
discretion, to be necessary or appropriate to (a) prevent a
violation of, or to perfect an exemption from, the registration
requirement of the Securities Act, or (b) implement the provisions
of the Plan or any agreement between the Company and the Optionee
with respect to such shares of Common Stock.
8. The Company and the Optionee agree that they will both be
subject to and bound by all of the terms and conditions of the
Plan, a copy of which is attached hereto and made part hereof. In
the event the Optionee is no longer a director of the Company or in
the event of his death or disability (as defined in the Plan), his
rights hereunder shall be governed by and be subject to the
provisions of the Plan. In the event of a conflict between the
terms of this Contract and the terms of the Plan, the terms of the
Plan shall govern.
9. The Optionee represents and agrees that he will comply
with all applicable laws relating to the Plan and the grant and
exercise of the option and the disposition of the shares of Common
Stock acquired upon exercise of the option, including without
limitation, federal state securities and "blue sky" laws.
10. This option is not transferrable otherwise than by will
or the laws of descent and distribution and may be exercised,
during the lifetime of the Optionee, only by him or his legal
representatives.
11. This Contract shall be binding upon and inure to the
benefit of any successor or assign of the Company and to any heir,
distributee, executor, administrator or legal representative
entitled under the Plan and by law to the Optionee's rights
hereunder.
-2-
12. This Contract shall be governed by and construed in
accordance with the laws of the State of Delaware.
13. The invalidity or illegality of any provision herein
shall not affect the validity of any other provision.
14. The Optionee agrees that the Company may amend the Plan
and the options granted to the Optionee under the Plan, subject to
the limitations contained in the Plan
IN WITNESS WHEREOF, the parties hereto have executed this
contract as of the day and year first above written.
SWANK, INC.
By: /s/ Marshall Tulin
Its: President
/s/ Mark Abramowitz
Optionee
Parker Chapin Flattau & Klimpl
1211 Avenue of the Americas
Address
New York, NY 10036
10q/95dirop3
-3-
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<ARTICLE> 5
<CIK> 0000095779
<NAME> SWANK, INC
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 631
<SECURITIES> 0
<RECEIVABLES> 22961
<ALLOWANCES> 6432
<INVENTORY> 27009
<CURRENT-ASSETS> 50476
<PP&E> 22259
<DEPRECIATION> 15742
<TOTAL-ASSETS> 60956
<CURRENT-LIABILITIES> 28185
<BONDS> 0
<COMMON> 1683
0
0
<OTHER-SE> 837
<TOTAL-LIABILITY-AND-EQUITY> 60956
<SALES> 29966
<TOTAL-REVENUES> 29966
<CGS> 18183
<TOTAL-COSTS> 18183
<OTHER-EXPENSES> 14124
<LOSS-PROVISION> 120
<INTEREST-EXPENSE> 246
<INCOME-PRETAX> (2587)
<INCOME-TAX> (1035)
<INCOME-CONTINUING> (1552)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1552)
<EPS-PRIMARY> (.09)
<EPS-DILUTED> (.09)
</TABLE>
