-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OXbUq+gF10kiX7cdX0M85RbVvt4co5Hk1KhI4O+SkNGBvvTD2deZ6C/TGoLycFec mF2iNIRD0hIPgbVlbzA8IA== 0000740868-97-000015.txt : 19970912 0000740868-97-000015.hdr.sgml : 19970912 ACCESSION NUMBER: 0000740868-97-000015 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19970628 FILED AS OF DATE: 19970812 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: EXCEL INDUSTRIES INC CENTRAL INDEX KEY: 0000740868 STANDARD INDUSTRIAL CLASSIFICATION: 3714 IRS NUMBER: 351551685 STATE OF INCORPORATION: IN FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-08684 FILM NUMBER: 97656276 BUSINESS ADDRESS: STREET 1: 1120 N MAIN ST STREET 2: P O BOX 3118 CITY: ELKHART STATE: IN ZIP: 46515-3118 BUSINESS PHONE: 2192642131 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ____________________________ Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 ____________________________ For the Quarterly Period Ended June 28, 1997 Commission File No. 1-8684 Excel Industries, Inc. (Exact name of registrant as specified in its charter) Indiana 35-1551685 (State or other jurisdiction (IRS Employer Identification of incorporation or organization) Number) 1120 North Main Street, Elkhart, Indiana 46514 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (219)264-2131 Indicate by "X" whether the registrant (a) 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 prior 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 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. At July 21, 1997, there were outstanding 10,732,494 common shares, no par value. EXCEL INDUSTRIES, INC. Index Page No. PART I Financial Information Consolidated Balance Sheet - June 28, 1997 and December 28, 1996 1 Consolidated Statement of Income - Quarter Ended June 28, 1997 and June 29, 1996 Six Months Ended June 28, 1997 and June 29, 1996 2 Consolidated Statement of Shareholders' Equity - Six Months Ended June 28, 1997 and June 29, 1996 3 Consolidated Statement of Cash Flows - Six Months Ended June 28, 1997 and June 29, 1996 4 Notes to Consolidated Financial Statements 5-8 Management's Discussion and Analysis of Financial Condition and Results of Operations 9-12 PART II Other Information 13 Signatures 14 Bylaw Amendment Adopted by Board of Directors on April 17, 1997 Exhibit 3.1 Amended Bylaws Exhibit 3.2 Financial Data Schedule Exhibit 27
EXCEL INDUSTRIES, INC. CONSOLIDATED BALANCE SHEET (UNAUDITED) (in thousands)
June 28, December 28, 1997 1996 ASSETS Current assets Cash and short-term investments $ 1,932 $ 6,580 Marketable securities 33,946 23,981 Accounts receivable 152,587 127,351 Customer tooling to be billed 21,381 17,278 Inventories 46,718 43,960 Prepaid expenses 20,309 19,800 Total current assets 276,873 238,950 Property, plant and equipment, less accumulated depreciation of (1997 - $107,461; 1996 - $90,723) 153,580 159,775 Goodwill 36,673 31,814 Other assets 13,601 12,695 $480,727 $443,234 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 85,883 $ 68,673 Accrued liabilities 59,674 46,583 Current portion of debt 9,414 9,554 Total current liabilities 154,971 124,810 Long-term debt 122,323 123,452 Other long-term liabilities 40,036 44,247 Commitments and contingent liabilities -- -- Shareholders' equity Preferred shares - no par value, authorized 1,000 shares, none issued -- -- Common shares - no par value, authorized 20,000 shares; issued and outstanding in 1997, 92,365 92,187 10,727, in 1996, 10,718 Retained earnings 71,340 58,653 Minimum pension liability adjustment (160) (160) Cumulative translation adjustment (148) 45 Total shareholders' equity 163,397 150,725 $480,727 $443,234 NOTE: The balance sheet at December 28, 1996 has been derived from the audited financial statements at that date. The accompanying notes are an integral part of this statement.
EXCEL INDUSTRIES, INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) (thousands, except per share amounts)
Quarter Ended June 28, June 29, 1997 1996 Net sales $264,474 $274,148 Cost of goods sold 227,375 238,161 Gross profit 37,099 35,987 Selling, administrative and engineering expenses 20,694 19,827 Operating income 16,405 16,160 Interest expense (2,902) (2,989) Other income, net 445 30 Income before income taxes 13,948 13,201 Provision for taxes on income 4,881 5,148 Net income $ 9,067 $ 8,053 Net income per share: Primary $ .85 $ .75 Fully diluted $ .76 $ .66 Cash dividends per share $ .125 $ .11
Six Months Ended June 28, June 29, 1997 1996 Net sales $515,690 $424,755 Cost of goods sold 447,593 372,865 Gross profit 68,097 51,890 Selling, administrative and engineering expenses 39,617 27,750 Operating income 28,480 24,140 Interest expense (5,671) (3,798) Other income, net 835 430 Income before income taxes 23,644 20,772 Provision for taxes on income 8,275 7,836 Net income $ 15,369 $ 12,936 Net income per share: Primary $ 1.43 $ 1.21 Fully diluted $ 1.30 $ 1.07 Cash dividends per share $ .25 $ .22 The accompanying notes are an integral part of this statement.
EXCEL INDUSTRIES, INC. CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED) FOR THE SIX MONTHS ENDED JUNE 28, 1997 AND JUNE 29, 1996 (in thousands)
MINIMUM PENSION COMMON RETAINED LIABILITY SHARES EARNINGS ADJUSTMENT Balance at December 28, 1996 $92,187 $ 58,653 $ (160) Net income 15,369 Dividends (2,682) Share options exercised 22 Shares issued under employee stock purchase plan 156 Cumulative translation adjustment Balance at June 28, 1997 $92,365 $ 71,340 $ (160) Balance at December 30, 1995 $95,157 $ 44,412 $ (659) Net income 12,936 Warrants issued 1,500 Dividends (2,356) Shares issued under employee stock purchase plan 67 Cumulative translation adjustment Balance at June 29, 1996 $96,724 $54,992 $ (659) CUMULATIVE TRANSLATION TREASURY ADJUSTMENT SHARES TOTAL Balance at December 28, 1996 $ 45 $ -- $150,725 Net income 15,369 Dividends (2,682) Share options exercised 22 Shares issued under employee stock purchase plan 156 Cumulative translation adjustment (193) (193) Balance at June 28, 1997 $ (148) $ -- $163,397 Balance at December 30, 1995 $ -- $(4,593) $134,317 Net income 12,936 Warrants issued 1,500 Dividends (2,356) Shares issued under employee stock purchase plan 67 Cumulative translation adjustment (88) (88) Balance at June 29, 1996 $ (88) $(4,593) $146,376 The accompanying notes are an integral part of this statement.
EXCEL INDUSTRIES, INC. CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) (in thousands)
Six Months Ended June 28, June 29, 1997 1996 Cash flows from operating activities Net income $ 15,369 $ 12,936 Adjustments to reconcile net income to net cash from operating activities: Depreciation and amortization 18,451 11,563 Deferred income taxes and other (3,145) 1,688 Changes in current assets and liabilities, excluding effect of acquisitions: Accounts receivable and other (21,403) (6,417) Inventories and customer tooling (6,628) 13,380 Accounts payable and accrued liabilities 22,411 7,469 Total adjustments 9,686 27,683 Net cash provided by operating activities 25,055 40,619 Cash flows from investing activities Purchase of property, plant and equipment (16,398) (12,034) Investment in marketable securities (9,965) 14,941 Businesses acquired (2,415) (58,984) Proceeds from sale of product line 2,926 -- Net cash used for investing activities (25,852) (56,077) Cash flows from financing activities Issuance of common shares 178 67 New debt -- 100,000 Maturities of long-term debt (1,347) (70,692) Dividends (2,682) (2,356) Net cash from (for) financing activities (3,851) 27,019 Net change in cash and short-term investments (4,648) 11,561 Cash and short-term investments at beginning of year 6,580 391 Cash and short-term investments at end of second quarter $ 1,932 $ 11,952 Supplemental Schedule of Noncash Activities: In connection with the restructuring reserve established for plant closures in March, 1997, goodwill has been increased by $5,400, which is net of income taxes. The accompanying notes are an integral part of this statement.
EXCEL INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1 - Basis of Presentation: The financial statements have been prepared from the unaudited financial records of the Company. In the opinion of management, the financial statements include all adjustments consisting only of normal recurring adjustments necessary for a fair presentation of the results of operations and financial position for the interim periods. Note 2 - Inventories: Inventories consist of the following: (in thousands of dollars)
June 28, December 28, 1997 1996 Raw materials $27,983 $24,047 Work in process and finished goods 19,592 20,770 LIFO Reserve (857) (857) $46,718 $43,960
Note 3 - Net Income per Share: Primary net income per share is computed using the weighted average number of shares outstanding during the period. In computing fully diluted earnings per share, the conversion of the Company's 10% Convertible Subordinated Notes is also assumed except when the effect of the conversion is anti-dilutive. Shares used to compute net income per share data are as follows: (amounts in thousands)
Quarter Ended Six Months Ended June 28, June 29, June 28, June 29, 1997 1996 1997 1996 Primary 10,726 10,708 10,724 10,708 Fully diluted 12,391 12,979 12,389 12,978
Note 4 - Contingencies A chemical cleaning compound, trichloroethylene (TCE), has been found in the soil and groundwater on the Company's property in Elkhart, Indiana, and in 1981 TCE was found in a well field of the City of Elkhart in close proximity to the Company's facility. The Company was named as one of nine potentially responsible parties (PRPs) in the contamination of this site. The United States Environmental Protection Agency (EPA) and the Indiana Department of Environmental Management (IDEM) have conducted a preliminary investigation and evaluation of the site and have undertaken remedial action in the nature of air- stripping towers. In early 1992, the EPA issued a Unilateral Order under Section 106 of the Comprehensive Environmental Response, Compensation and Liability Act which required the Company and other PRPs to undertake remedial work. The Company and the other PRPs have reached an agreement regarding the funding of groundwater monitoring and the operation of the air-strippers as required by the Unilateral Order. The Company was required to install and operate a soil vapor extraction system to remove TCE from the Company's property. The Company has installed and is operating the equipment pursuant to the Unilateral Order. In addition, the EPA and IDEM have asserted a claim for reimbursement of their investigatory costs and the costs of installing and operating the air-strippers on the municipal well field (the EPA Costs). On February 22, 1993, the United States filed a lawsuit in the United States District Court for the Northern District of Indiana against eight of the PRPs, including the Company. On July 20, 1993, IDEM joined in the lawsuit. The lawsuit seeks recovery of the costs of enforcement, prejudgment interest and an amount in excess of $6.8 million, which represents costs incurred to date by the EPA and IDEM, and a declaration that the eight defendant PRPs are liable for any future costs incurred by the EPA and IDEM in connection with the site. On September 5, 1996 the United States Department of Justice lodged with the United States District Court for the Northern District of Indiana a proposed partial consent decree which specifies payment of Federal Past Response Costs from certain PRPs which for Excel amounted to approximately $3.2 million which together with amounts due IDEM would bring Excel's total obligation to approximately $3.4 million. This consent decree has not been accepted by the Court, and comments objecting to the consent decree have been lodged with the United States Department of Justice and the Court. The Company does not believe the annual cost to the Company of monitoring groundwater and operating the soil vapor extraction system and the air-strippers will be material. Each of the PRPs, including the Company, is jointly and severally liable for the entire amount of the EPA Costs. The Company believes that adequate provisions have been recorded for its costs and its anticipated share of the EPA Costs and that its cash on hand, unused lines of credit or cash from operations are sufficient to fund any required expenditures. The Company has been named a PRP for costs at seven other disposal sites. The remedial investigations and feasibility studies have been completed, and the results of those studies have been provided to the appropriate agencies. The studies indicated a range of viable remedial approaches, but agreement has not yet been reached on the final remediation approach. Furthermore, the PRPs for these sites have not reached an agreement on the allocation of costs between the PRPs. The Company believes it either has no liability as a responsible party or that adequate provisions have been recorded for current estimates of the Company's liability and estimated legal costs associated with the settlement of these claims. It is reasonably possible that the Company's recorded estimate of its obligation may change in the near term. There are claims and pending legal proceedings against the Company and its subsidiaries with respect to taxes, workers' compensation, warranties and other matters arising out of the ordinary conduct of the business. The ultimate result of these claims and proceedings at June 28, 1997 is not determinable, but, in the opinion of management, adequate provision for anticipated costs has been made or insurance coverage exists to cover such costs. Note 5 - Acquisitions On April 3, 1996, the Company completed the purchase of all of the outstanding common shares of Anderson Industries, Inc. (Anderson). The accompanying consolidated statement of income for the six months ended June 28, 1997 includes the operating results of Anderson. Pro forma unaudited consolidated operating results of the Company and Anderson for the six months ended June 29, 1996, assuming the acquisition had been made as of the beginning of 1996, are summarized below (in thousands except per share amounts): Net sales $ 522,569 Net income 14,608 Net income per share, primary 1.36 Net income per share, fully diluted 1.20
The unaudited pro forma financial information presented is not necessarily indicative either of the results of operations that would have occurred had the transactions been completed on the indicated dates or of future results of operations of the combined companies. In the first quarter of 1997 the Company recorded an $8.7 million pre-tax restructuring reserve for closing manufacturing facilities in 1997 at Rockford, Illinois and Battle Creek, Michigan which had been acquired as part of the acquisition of Anderson. The reserve consists of personnel related costs (mainly severance pay and fringe benefits) and costs related to the disposals of buildings and equipment. The reserve increased the associated goodwill by $5.4 million (which is net of income taxes) and was not a charge to earnings. In addition, the Company expects that additional expenses including relocation, start-up and other related costs not covered by the reserve will be approximately $4.2 million pretax or about 24 cents per share after tax for the year. In January, 1997, the Company completed the purchase of the assets of the Compliance Group located in Greendale, Wisconsin for approximately $2.4 million in cash. The excess of the purchase price over the estimated fair value of assets acquired has been acccounted for as goodwill. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS General In 1996, the Company acquired all of the outstanding common shares of Anderson Industries, Inc., (Anderson) located in Rockford, Illinois. With this acquisition, the Company established lines of business to distinguish activities for the light vehicle segment separate from the recreational vehicle, mass transit and heavy truck segment (RV/MT/HT). The light vehicle products segment normally experiences reduced sales volumes in the months of July, August and December as vacation periods, model changeover and start-up and holidays affect the number of production days. The RV/MT/HT products segment is seasonal in that sales in the quarter October through December are normally at reduced levels. Material Changes in Results of Operations: Quarter Ended June 28, 1997 Compared to Quarter Ended June 29, 1996 Sales in the second quarter of 1997 decreased 3.5% or $9.6 million to $264.5 million from $274.1 million in 1996. The strikes at Chrysler and General Motors reduced sales in 1997 in excess of $8 million. North American light vehicle production volumes overall declined 3%. However, Ford truck production increased 16% which helped offset price reductions on products with long-term pricing agreements. Sales for the light vehicle products segment were $206.0 million in the second quarter of 1997 compared to $215.0 million in the 1996 period. For the RV/MT/HT products segment sales decreased slightly to $58.5 million in 1997 from $59.1 million in 1996. Gross profit was $37.1 million in the current quarter or 14.0% of sales, up from $36.0 million or 13.1% of sales in the second quarter of 1996. The improvement in margin results from continued emphasis on cost reductions pertaining to the Anderson locations, continuous improvement efforts and an aggressive rationalization activity throughout Excel. Costs incurred in connection with plant closings and relocation of $2.5 million recognized in the second quarter were approximately offset by a reduction in warranty accruals. Selling, administrative and engineering expenses totaled $20.7 million in the second quarter of 1997, up from $19.8 million in the 1996 second quarter. The increase was primarily due to the increase in product development costs. Interest expense totaled $2,902,000 in the 1997 second quarter down from $2,989,000 in the year ago second quarter. The decrease was the result of reducing long-term debt through scheduled payments. Other income of $445,000, which is primarily interest income on marketable debt securities, was up from the $30,000 in the 1996 second quarter. The 1996 interest income of $350,000 was offset by the recognition of our equity in losses of our Brazilian joint venture in 1996. Provision for taxes on income was at an effective rate of 35% for 1997, down from 39% in 1996. The reduction was due to lower estimated state income taxes and favorable benefits of our foreign sales corporation. Material Changes in Results of Operations: Six Months Ended June 28, 1997 Compared to Six Months Ended June 29, 1996 Sales in the first half of 1997 increased 21.4% or $90.9 million to $515.7 million from the $424.8 million in 1996. The acquisition of Anderson was effective the first of April, 1996. Sales in 1997 increased by $98.2 million due to this transaction. Gross profit was $68.1 million in the six months ended June 28, 1997 or 13.2% of sales, up from gross profit of $51.9 million or 12.2% of sales in the first half of 1996. The increase in gross profit in the half was due to continued cost reduction efforts pertaining to the Anderson locations, continuous improvement efforts and an aggressive rationalization activity throughout Excel. Selling, administrative and engineering expenses totaled $39.6 million in the first half up from $27.8 million in the 1996 first half. The increase was due to the addition of Anderson locations and increases in product development expenses. Interest expense totaled $5,671,000 in 1997 up from $3,798,000 in the year ago first half due to the additional long-term debt outstanding including Senior Notes issued in connection with the Anderson acquisition. Other income of $835,000 consists primarily of interest income on marketable debt securities. Other income of $430,000 in 1996 included interest income of $722,000 which was offset in part by the recognition of our equity in losses of our Brazilian joint venture. Provision for taxes on income was at an effective rate of 35% for 1997, down from 37.7% in 1996. The decrease was due to lower estimated state income taxes and favorable benefits of our foreign sales corporation. Material Changes in Financial Condition: For the six months ended June 28, 1997 cash flow from operations totaled $25.1 million of which $16.4 million was used for capital expenditures, $2.4 million for the acquisition of The Compliance Group and an additional $2.7 million for dividends. Capital expenditures for the year are estimated to be $50.5 million. The Company recorded an $8.7 million pre-tax restructuring reserve in the first quarter of 1997 for closing manufacturing facilities in 1997 at Rockford Illinois and Battle Creek, Michigan which had been acquired in 1996 as part of the acquisition of Anderson. The reserve increased the associated goodwill by $5.4 million (which is net of income taxes) and was not a charge to earnings. Total charges to the reserve through June 28, 1997 were $2.0 million. In addition, the Company expects that additional expenses to be incurred in 1997 including relocation, start-up and other related costs not covered by the reserve will be approximately $4.2 million pretax or about 24 cents per share after tax. Actual expenditures through June 28, 1997 were $3.3 million. The Company estimates that annual savings from the plant closures will be approximately $7 million to $8 million or 40 cents to 45 cents per share. In January, 1997, the Company completed the purchase of the assets of the Compliance Group located in Greendale, Wisconsin for approximately $2.4 million in cash. The excess of the purchase price over the estimated fair value of assets acquired has been accounted for as goodwill. In May, 1997, the Company completed the sale of the automotive parking brake product line for $2.9 million. This product line was acquired when Excel purchased Anderson. Sales in 1996 were approximately $12 million or less than 2% of total sales. Cash and short-term marketable securities amounted to $35.9 million at June 28, 1997, an increase of $5.3 million from December 28, 1996. At June 28, 1997, the Company had available unused lines of credit of approximately $60 million. For the remainder of 1997 the Company expects its current cash balances, operating cash flow and available credit lines to be sufficient to finance operating cash needs, capital expenditures and any environmental remediation requirements. The Company has supply agreements with a majority of its automotive customers which require the absorption of the effects of inflation and require specified price reductions or productivity offsets to price reductions. The Company believes that these types of agreements are typical in the automotive supply business, and the Company's ability to maintain gross margins at or near their present levels will be dependent on its ability to substantially offset the effects of such agreements through productivity improvements, cost reduction programs and implementation of value analysis/value engineering programs, which reduce part weight and system costs to the customer. Forward-Looking Statements This report contains certain forward-looking statements which involve certain risks and uncertainties. Such statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those anticipated. Potential risks and uncertainties include economic factors, concentration of a substantial percentage of sales in a few major OEM customers, and other business factors. Readers are cautioned not to place undue reliance on those forward-looking statements which speak only as of the date of this report. PART II. OTHER INFORMATION ITEM 4. Submission of Matters to a Vote of Security Holders At the annual Shareholders' Meeting on April 17, 1997, the shareholders approved by a vote of 7,709,035 For, 102,300 Against, 64,099 Abstaining, and 2,977,201 Broker Non-Voting, the Excel Industries, Inc. 1997 Long-Term Incentive Plan (The "LTIP"). The LTIP reserves 500,000 common shares for issuance under the plan. Participants are key employees, including officers, of the Corporation and its subsidiaries who are in a position to make significant contributions to the growth and long-term success of the Corporation. Under the LTIP, performance shares are awarded to key executives of the Corporation based on the attainment of one or more preestablished performance goals over a specified performance period. In an uncontested election of Directors, the following were elected.
Authority For Withheld James O. Futterknecht, Jr. 7,814,111 61,323 Joseph A. Robinson 7,813,611 61,823 John G. Keane 7,813,611 61,823 Richard A. Place 7,811,111 64,323 James K. Sommer 7,814,111 61,323 Ralph R. Whitney, Jr. 7,813,611 61,823
SIGNATURES Pursuant to the requirement of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
EXCEL INDUSTRIES, INC. (Registrant) Date: August 8, 1997 s/ James O. Futterknecht James O. Futterknecht Chairman, President and Chief Executive Officer Date: August 8, 1997 s/ Joseph A. Robinson Joseph A. Robinson Senior Vice President, Secretary and Chief Financial Officer Date: August 8, 1997 s/ Ike K Eikelberner Ike K. Eikelberner Vice President, Corporate Controller and Chief Accounting Officer
SIGNATURES Pursuant to the requirement of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
EXCEL INDUSTRIES, INC. (Registrant) Date: August 8, 1997 s/ James O. Futterknecht James O. Futterknecht Chairman, President and Chief Executive Officer Date: August 8, 1997 s/ Joseph A. Robinson Joseph A. Robinson Senior Vice President, Secretary and Chief Financial Officer Date: August 8, 1997 s. Ike K. Eikelberner Ike K. Eikelberner Vice President, Corporate Controller and Chief Accounting Officer
EX-27 2
5 1000 6-MOS DEC-27-1997 JUN-28-1997 1932 33946 154885 2298 46718 276873 261041 107461 480727 154971 0 0 0 92365 71032 480727 515690 515690 447593 487210 (835) 0 5671 23644 8275 15369 0 0 0 15369 1.43 1.30
EX-3.1 3 EXHIBIT 3.1 CERTIFICATE OF SECRETARY OF EXCEL INDUSTRIES, INC. I, Joseph A. Robinson, certify that I am the duly elected Secretary of Excel Industries, Inc., a corporation organized and existing under the laws of the State of Indiana (hereinafter the "Corporation"), and that the following is a true and correct copy of certain resolutions duly adopted by the Board of Directors in accordance with law and the Code of By-Laws of the Corporation on April 17, 1997, and that such resolutions have not been rescinded or modified: RESOLVED, that the Board of Directors of Excel Industries, Inc. hereby amends the Code of By-Laws of the Corporation as follows: 1. Article VII, Section 8 is hereby amended to read as follows: Section 8. Special Meetings, for any purpose or purposes (unless otherwise prescribed by law), may be called by the Board or the Chairman of the Board or the President, and shall be called by the President or any Vice President at (a) the request in writing of a majority of the Board or (b) at the written demand delivered to the Secretary by shareholders ("Demanding Shareholders") holding of record not less than a majority of the voting power of all the shares of the Corporation issued and outstanding and entitled by the Articles of Incorporation of the Corporation, as the same may, from time to time, be amended, to vote on the business proposed to be transacted at the meeting; provided however that, for purposes of calculating the number of shares held by the Demanding Shareholders, only shares of the Demanding Shareholders which have been beneficially owned or held of record by the holders thereof for at least three (3) years shall be included. All requests or demands for Special Meetings shall state the purpose or purposes thereof, and the business transacted at such Meeting shall be confined to the purposes stated in the call and matters germane thereto. Notice of any Special Meeting called at the written demand of shareholders shall be delivered or mailed within sixty days of the Secretary's receipt of such demand. 2. Article VIII is hereby further amended by adding the following Sections 13 and 14: Section 13. At any meeting of the shareholders, only such business may be conducted as shall have been properly brought before the meeting, and as shall have been determined to be lawful and appropriate for consideration by shareholders at the meeting. To be properly brought before a meeting, business must be (a) specified in the notice of meeting given in accordance with Section 9 of this Article VIII, (b) otherwise properly brought before the meeting by or at the direction of the board of directors or the Chairman of the Board, or (c) otherwise properly brought before the meeting by a shareholder. For business to be properly brought before a meeting by a shareholder pursuant to clause (c) above, the shareholder must have given timely notice thereof in writing to the secretary of the Corporation. To be timely, a shareholder's notice must be delivered to, or mailed and received at, the principal office of the Corporation, not later than the earlier of (x) 270 days after the adjournment of the next preceding annual meeting or (y) the close of business on the seventh day following the date on which notice of the meeting is formally given to shareholders. A shareholder's notice to the secretary shall set forth as to each matter the shareholder proposes to bring before the meeting (a) a brief description of the business desired to be brought before the meeting, (b) the name and address, as they appear on the Corporation's stock records, of the shareholder proposing such business, (c) the class and number of shares of the Corporation which are beneficially owned by the shareholder, and (d) any interest of the shareholder in such business. Notwithstanding anything in these by-laws to the contrary, no business shall be conducted at a meeting except in accordance with the procedures set forth in this Section 13. The person presiding at the meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the by-laws, or that business was not lawful or appropriate for consideration by shareholders at the meeting, and if he should so determine, he shall so declare to the meeting and any such business shall not be transacted. Section 14. Nominations of persons for election to the board of directors of the Corporation may be made at any meeting of shareholders by or at the direction of the board of directors or by any shareholder of the Corporation entitled to vote for the election of directors at the meeting. Shareholder nominations shall be made pursuant to timely notice given in writing to the Secretary of the Corporation in accordance with Section 13 of this Article VIII. Such shareholder's notice shall set forth, in addition to the information required by Section 13, as to each person whom the shareholder proposes to nominate for election or re-election as a director, (a) the name, age, business address and residence address of such person, (b) the principal occupation or employment of such person, (c) the class and number of shares of the Corporation which are beneficially owned by such person,(d) any other information relating to such person that would be required to be disclosed in solicitation of proxies for election of directors pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including, without limitation, such person's written consent to being named as a nominee and to serving as a director, if elected), and (e) the qualifications of the nominee to serve as a director of the Corporation. No shareholder nomination shall be required to be included in any proxy solicitation on behalf of the board of directors. No shareholder nomination shall be effective unless made in accordance with the procedures set forth in this Section 14. The person presiding at the meeting shall, if the facts warrant, determine and declare to the meeting that a shareholder nomination was not made in accordance with the by-laws, and if he should so determine, he shall so declare to the meeting and the defective nomination shall be disregarded. Dated this 11th day of August, 1997. s/Joseph A. Robinson Joseph A. Robinson Secretary EX-3.2 4 EXHIBIT 3.2 CODE OF BY-LAWS OF EXCEL INDUSTRIES, INC. (the "Corporation") ARTICLE I Officers Section 1. The officers of the Corporation shall consist of a Chairman of the Board, the President, one or more Vice Presidents, the Secretary, the Treasurer, and such assistant officers as the Board of Directors shall from time to time designate and elect. Section 2. Any two offices may be held by the same person. The officers of the Corporation shall be elected by the Board of Directors at such time and in such manner and for such terms as the Board of Directors may prescribe. No officer, other than the Chairman of the Board, need be a Director of this Corporation. ARTICLE II Chairman of the Board of Directors The Board of Directors shall choose from among its members a Chairman of the Board who shall also serve as the Chief Executive Officer of the Corporation. The Chairman of the Board of Directors shall preside at all meetings of the shareholders and directors. He shall perform all duties incident to the office of the Chief Executive Officer and shall perform any additional duties as from time to time may be assigned to him by the Board of Directors. ARTICLE III President and Vice President Section 1. The President shall be the Chief Operating Officer of the Corporation and shall have management responsibility for the operation of the Corporation. It shall be his duty to preside at all meetings of the shareholders in the absence of the Chairman of the Board of Directors and to perform such other duties and render such other services for and in behalf of the Corporation as may be assigned to him by the Chairman of the Board. Section 2. Each Vice President shall have such powers and perform such duties as the Board of Directors may prescribe or as the Chairman of the Board or the President may delegate to him. At the request of the Chairman of the Board or the President, any Vice President may temporarily act in the Place of the President and may perform all of the duties of the Presidency in his absence or during his disability. ARTICLE IV Secretary Section 1. The Secretary shall prepare or cause to be prepared the minutes of the meetings of the shareholders and of the Board of Directors. He shall see that all notices are duly given in accordance with the provisions of the Code of By-Laws and as required by law. The Secretary shall be custodian and responsible for the authentication of the records and, in general, shall perform all duties incident to the Office of Secretary. He shall have such other powers and perform such other duties as this Code of By-Laws provides or as may, from time to time, be assigned by the Board of Directors. Section 2. The Secretary shall procure all of the stock certificates, stock books, stock transfer books, and other similar records. Section 3. The Secretary shall have the custody of and affix the corporate seal whenever the same is required to be affixed and shall perform such other duties and render such other services as may be assigned to him from time to time by the Board of Directors. ARTICLE V Treasurer Section 1. The Treasurer shall be the Chief Financial Officer of the Corporation. He shall procure and have custody of the financial records of the Corporation and shall receive and have custody of and safely keep all of the cash and securities of the Corporation. He shall keep an accurate record of all receipts and disbursements in books and records belonging to the Corporation; shall deposit all moneys and securities in the name and to the credit of the Corporation in such banks, trust companies or other depositories as the Board of Directors may designate from time to time as the depositories of the Corporation; shall disburse the funds of the Corporation as ordered by the Board of Directors; shall render an account of all of his transactions as such Treasurer and of the financial condition of the Corporation whenever required by the Board of Directors; and, in general, shall perform all the duties incident to the office of Treasurer. Section 2. The Treasurer shall perform such other duties and render such other services as may be assigned to him from time to time by the Board of Directors. ARTICLE VI Additional Duties of Officers In addition to the duties imposed upon the several officers of the Corporation, they shall have the powers and perform the duties usually had and possessed by the respective officers of a like corporation. Assistant officers shall have such powers and duties as the officers whom they are elected to assist shall specify and delegate to them and such other powers and duties as these By-Laws or the Board of Directors may prescribe. ARTICLE VII Duties of Officers Delegated In case of the absence or disability of any officer of the Corporation, the Board of Directors may delegate the powers and duties of any such officer of the Corporation for such period of time as the Board of Directors may determine. ARTICLE VIII Meetings of Shareholders Section 1. All meetings of the shareholders of the Corporation shall be held at such place within or without the State of Indiana as may be specified in the notice of the meeting. Section 2. The annual meeting of the shareholders of the Corporation shall be held on the third Thursday of April of each and every year. Failure to hold the meeting at the designated time shall not work any forfeiture or a dissolution of the Corporation or affect the validity of any corporate action. Section 3. A complete list of the shareholders entitled to vote at any shareholders' meeting, arranged in alphabetical order and containing the address and number of shares of stock so held by each shareholder who is entitled to vote at said meeting, shall be prepared by the Secretary and shall be open to the examination of any shareholder at the office of the Corporation at the time of the meeting and for five days prior thereto. Section 4. At all shareholders' meetings, a quorum shall consist of a majority of all of the shares of the stock outstanding and entitled by the Articles of Incorporation to vote on the business to be transacted at said meeting, but a meeting composed of less than a quorum may adjourn the meeting from day to day thereafter or until some future time. Section 5. At the annual meeting of the shareholders, there shall be elected by plurality vote a Board of Directors who shall hold office until the next annual meeting of shareholders and until their successors have been elected and have qualified. Section 6. Except as otherwise provided by law or by the provisions of the Articles of Incorporation, each outstanding share of Common Stock is entitled to one vote on each matter voted on at a shareholders' meeting. Section 7. A shareholder may vote, either in person or by proxy executed in writing by the shareholder or a duly authorized attorney-in-fact. No proxy shall be valid after eleven (11) months, unless a shorter or longer time is expressly provided in the appointment form. Section 8. Special meetings, for any purpose or purposes (unless otherwise prescribed by law), may be called by the Board or the Chairman of the Board or the President, and shall be called by the President or any Vice President at (a) the request in writing of a majority of the Board or (b) at the written demand delivered to the Secretary by shareholders ("Demanding Shareholders") holding of record not less than a majority of the voting power of all the shares of the Corporation issued and outstanding and entitled by the Articles of Incorporation of the Corporation, as the same may, from time to time, be amended, to vote on the business proposed to be transacted at the meeting; provided however that, for purposes of calculating the number of shares held by the Demanding Shareholders, only shares of the Demanding Shareholders which have been beneficially owned or held of record by the holders thereof for at least three (3) years shall be included. All requests or demands for Special Meetings shall state the purpose or purposes thereof, and the business transacted at such Meeting shall be confined to the purposes stated in the call and matters germane thereto. Notice of any special Meeting called at the written demand of shareholders shall be delivered or mailed within sixty days of the Secretary's receipt of such demand. Section 9. Written notice of each meeting of shareholders shall be given by the Secretary, to each shareholder of record who is entitled to vote at said meeting, at least ten days prior to the time fixed for the holding of said meeting, which said notice shall state the place, day and hour and the purpose for which said meeting is called, and said notice shall be addressed to the last known place of residence of each shareholder, as shown on the records of the Corporation; the ten days shall be computed from the date upon which said notice is deposited in the mails. Section 10. Notice of any shareholders' meeting may be waived in writing by any shareholder if the waiver sets forth in reasonable detail the purpose or purposes for which the meeting is called and the time and place thereof. Section 11. No shares of stock shall be voted at any annual or special meeting of shareholders upon which any installment is due and unpaid or which are owned by the Corporation. Section 12. Chapter 42 of the Indiana Business Corporation Law (IND. CODE Sec. 23-1-42) shall not apply to any control share acquisitions as defined in IND. CODE Sec. 23-1-42-2 by CIGNA Mezzanine Partners II, L.P., Connecticut General Life Insurance Company, Life Insurance Company of North America, The Paul Revere Life Insurance Company, The Paul Revere Protective Life Insurance Company, Rhode Island Hospital Investment Trust Fund B and Balboa Insurance Company and their respective nominees, affiliates, successors and assigns as a result of the sale and issuance by the Corporation of certain 10% Convertible Subordinated Notes due December 1, 2000 in the aggregate principal amount of ,30,000,000 (the "Notes") and any issuance of shares of the common stock of the Corporation upon any subsequent conversion of the Notes. Section 13. At any meeting of the shareholders, only such business may be conducted as shall have been properly brought before the meeting, and as shall have been determined to be lawful and appropriate for consideration by shareholders at the meeting. To be properly brought before a meeting, business must be (a) specified in the notice of meeting given in accordance with Section 9 of this Article VIII, (b) otherwise properly brought before the meeting by or at the direction of the board of directors or the Chairman of the Board, or (c) otherwise properly brought before the meeting by a shareholder. For business to be properly brought before a meeting by a shareholder pursuant to clause (c) above, the shareholder must have given timely notice thereof in writing to the secretary of the Corporation. To be timely, a shareholder's notice must be delivered to, or mailed and received at, the principal office of the Corporation, not later than the earlier of (x) 270 days after the adjournment of the next preceding annual meeting or (y) the close of business on the seventh day following the date on which notice of the meeting is formally given to shareholders. A shareholder's notice to the secretary shall set forth as to each matter the shareholder proposes to bring before the meeting (a) a brief description of the business desired to be brought before the meeting, (b) the name and address, as they appear on the Corporation's stock records, of the shareholder proposing such business, (c) the class and number of shares of the Corporation which are beneficially owned by the shareholder, and (d) any interest of the shareholder in such business. Not withstanding anything in these by-laws to the contrary, no business shall be conducted at a meeting except in accordance with the procedures set forth in this Section 13. The person presiding at the meeting shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the by-laws, or that business was not lawful or appropriate for consideration by shareholders at the meeting, and if he should so determine, he shall so declare to the meeting and any such business shall not be transacted. Section 14. Nominations of persons for election to the board of directors of the Corporation may be made at any meeting of shareholders by or at the direction of the board of directors or by any shareholder of the Corporation entitled to vote for the election of directors at the meeting. Shareholder nominations shall be made pursuant to timely notice given in writing to the Secretary of the Corporation in accordance with Section 13 of this Article VIII. Such shareholder's notice shall set forth, in addition to the information required by Section 13, as to each person whom the shareholder proposes to nominate for election or re-election as a director, (a) the name, age, business address and residence address of such person, (b) the principal occupation or employment of such person, (c) the class and number of shares of the Corporation which are beneficially owned by such person, (d) any other information relating to such person that would be required to be disclosed in solicitation of proxies for election of directors pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (including, without limitation, such person's written consent to being named as a nominee and to serving as a director, if elected), and (e) the qualifications of the nominee to serve as a director of the Corporation. No shareholder nomination shall be required to be included in any proxy solicitation on behalf of the board of directors. No shareholder nomination shall be effective unless made in accordance with the procedures set forth in this Section 14. The person presiding at the meeting shall, if the facts warrant, determine and declare to the meeting that a shareholder nomination was not made in accordance with the by-laws, and if he should so determine, he shall so declare to the meeting and the defective nomination shall be disregarded. ARTICLE IX DIRECTORS Section 1. The property and business affairs of the Corporation shall be managed and controlled by a Board of Directors, none of whom need be a shareholder of the Corporation. The Board of Directors shall consist of a minimum of six and a maximum of eight members, the actual number of directors to be fixed from time to time by resolution of the Board of Directors. The members of the Board of Directors shall be elected at the annual meeting of the shareholders, shall hold office until the next annual meeting of the shareholders and until their successors have been elected and have qualified. In case of the failure to hold the annual meeting on the date fixed herein for the same to be held, the Directors shall hold over until the next meeting of the shareholders for the purpose of electing Directors. Section 2. Vacancies in the Board of Directors, caused by resignation, death or other incapacity or by increase in the number of Directors, shall be filled for the unexpired term by a majority vote of the remaining members of the Board of Directors. Section 3. No person shall be eligible to be elected or re- elected as a director, or to fill a vacancy on the Board of Directors, who at the time of such election or appointment shall have attained the age of seventy (70) years. ARTICLE X Meeting of Directors Section 1. Immediately following the annual meeting of the shareholders, the annual meeting of the Board of Directors shall be held, without notice, at the place at which the annual meeting of the shareholders is held. Section 2. Special meeting of the Board of Directors may be called by the Chairman of the Board of Directors, by the President, or by any two members of the Board of Directors, at any place within or without the State of Indiana, upon twenty- four hours' notice, specifying the date, time and place of the meeting, given to each director, either personally, by mailing, or by telegram. Section 3. A majority of the whole Board of Directors shall constitute a quorum for the transaction of any business except the filling of vacancies, but a smaller number may adjourn from time to time until a future date or until a quorum is secured. For the purpose only of filling a vacancy or vacancies in the Board of Directors, a quorum shall consist of a majority of the whole Board of Directors, less the vacancy or the vacancies therein. The act of a majority of the Directors present at a meeting duly called at which a quorum is present shall be the act of the Board of Directors. Section 4. Notice of any special meeting of the Board of Directors may be waived in writing by any Director, before or after the date and time stated in the notice, if the waiver is signed by the Director and filed with the Corporation's minutes or records. In addition, a Director's attendance at or participation in a meeting waives any required notice of the meeting unless the Director at the beginning of the meeting (or promptly upon his arrival) objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting. Section 5. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if a written consent to such action is signed by all members of the Board of Directors or such committee, as the case may be, and such written consent is filed with the minutes of the proceedings of the Board of Directors. ARTICLE XI Powers of Directors The Board of Directors shall have all such powers as may be exercised by the Corporation, subject to the provisions of the statutes of the State of Indiana, the Articles of Incorporation and these By-Laws, and subject to such further regulations as may be, from time to time, made by the shareholders. ARTICLE XII Compensation of Directors and Members of Committees The members of the Board of Directors and members of committees of the Corporation, who are not salaried employees of the Corporation, shall receive such compensation for their services to be rendered for and in behalf of the Corporation as may, from time to time, be fixed by the Board of Directors, and the compensation so fixed shall continue to be payable until the Board of Directors shall have thereafter fixed a different compensation, which it may do at any regular or special meeting. ARTICLE XIII Shares Section 1. The shares of stock of the Corporation shall be represented by certificates signed by the Chairman of the Board or the President and the Secretary or an Assistant Secretary of the Corporation and may be sealed with a seal of the Corporation or a facsimile thereof. The signatures of the officers upon a certificate may be facsimiles if the certificate is countersigned by a Transfer Agent or registered by a Registrar other than the Corporation itself or an employee of the Corporation. In the event any officer who has signed or whose facsimile signature has been placed upon a certificate shall cease to be such officer before the certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer at the time of the issue of such certificate. Section 2. The Board of Directors may, at its discretion, appoint a Transfer Agent and a Registrar for the shares of common stock of the Corporation. The Transfer Agent shall be in charge of the issue, transfer, and cancellation of shares of stock and shall countersign all stock certificates; and, in the event the Transfer Agent and Registrar shall be the same, then such stock certificates shall be countersigned by it as Transfer Agent and Registrar. The Transfer Agent shall maintain stock transfer books which shall include a record of the shareholders, giving the names and addresses of all shareholders and the number and class of shares held by each; shall prepare voting lists for meetings of shareholders; shall produce and keep open these lists at the meetings, and shall perform such other duties as may be delegated by the Board of Directors. The Registrar shall be in charge of preventing the overissue of shares, shall register all stock certificates, and shall perform such other duties as may be delegated by the Board of Directors. Section 3. The Corporation shall have a first lien on all of the shares of the capital stock, and upon all dividends declared upon the same, for any indebtedness of any character or description owing to it from the respective holders of any such share or shares. Section 4. The shares of the Corporation shall be transferable on the books of the Corporation upon surrender of the certificate or certificates representing the same, properly endorsed by the registered holder or by her/his duly authorized attorney. Section 5. The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the legal owner thereof and accordingly shall not be bound to recognize any equitable claim to or interest in such share or shares on the part of any other persons, whether or not it shall have express or other notice thereof, save as expressly provided by the laws of the State of Indiana. Section 6. The provisions of that certain Rights Agreement dated December 21, 1995, by and between the Corporation and Chemical Mellon Shareholder Services L.L.C. are incorporated in and made a part of this Code of By-Laws as if set forth in full herein. ARTICLE XIV Fiscal year The fiscal year of this Corporation shall be the calendar year consisting of 52/53 weeks with the year ending on the weekend closest to December 31. Article XV Checks for Money All checks, drafts or other orders for the payment of the funds of the Corporation shall be signed by the Treasurer, or by such other individual or individuals as may hereafter from time to time be designated by the Board of Directors. ARTICLE XVI Dividends Section 1. The Board of Directors may, at any annual or special meeting, declare and authorize the distribution of a dividend to the shareholders of the Corporation. Section 2. When the Board of Directors declares a dividend, it shall fix a date as the record date for the determination of the shareholders who shall be entitled to receive said dividend, and said dividend shall be paid only to the shareholders of record on said record date as shown by the books of the Corporation. ARTICLE XVII Compensation of Officers The officers of the Corporation shall receive such compensation for their services as may be, from time to time, fixed by the Board of Directors, and the compensation so fixed shall continue to be payable until the Board of Directors shall have fixed a different compensation, which it may do at any regular or special meeting. ARTICLE XVIII Execution of Negotiable Instruments and Contracts The promissory notes, debentures, certificates of indebtedness, written contracts, and other similar instruments which the Corporation may hereafter issue or execute, shall be the valid obligations of the Corporation, if signed in its behalf by the Chairman of the Board, the President, a Vice President, the Secretary, the Treasurer, or any other officer or agent designated and authorized by the Board of Directors. -----END PRIVACY-ENHANCED MESSAGE-----