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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
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(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED APRIL 30, 1999
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 1-4822
EARL SCHEIB, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 95-1759002
(STATE OR OTHER JURISDICTION OF INCORPORATION
OR ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
8737 WILSHIRE BOULEVARD BEVERLY HILLS,
CALIFORNIA 90211-2795
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (310) 652-4880
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED
CAPITAL STOCK, $1.00 PAR VALUE AMERICAN STOCK EXCHANGE
SECURITIES REGISTERED PURSUANT TO SECTION 12 (G) OF THE ACT: NONE
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Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for at least the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K. [ ]
As of July 16, 1999 the registrant had 4,358,682 shares of its Capital
Stock, $1.00 par value, issued and outstanding, and the aggregate market value
of the voting stock held by non-affiliates of the registrant was $20,158,904
(approximately based upon the closing price of the Capital Stock on the American
Stock Exchange on such date).
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant's Annual Report to Stockholders for the fiscal
year ended April 30, 1999 are incorporated into Part II by reference.
Portions of the registrant's Proxy Statement dated July 29, 1999 for use at
the registrant's annual meeting of stockholders are incorporated into Part III
by reference.
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PART I
ITEM 1. BUSINESS
GENERAL
Earl Scheib, Inc., a Delaware corporation, and its subsidiaries
(collectively referred to as the "Company") is celebrating over 60 years in the
automobile paint and repair business as the successor to a business founded as a
sole proprietorship by Earl A. Scheib in 1937. The Company's principal executive
offices are located at 8737 Wilshire Boulevard, Beverly Hills, California 90211.
The Company maintains personnel, systems, advertising, real estate and
accounting functions at its principal executive offices. See ITEM 2.
"Properties."
At April 30, 1999, the Company operated a chain of 174 automobile
production paint and body shops which specialize in affordably priced repainting
of automobiles and performing body repairs other than major collision repair,
frame straightening, or axle work. The Company also offers the replacement of
certain car body parts using new, used and after-market parts, glass replacement
as well as factory style pinstriping, molding and vinyl top replacement. All of
the Company's sales are paid by either cash or credit cards with the exception
of the Company's fleet and trade sales which may be made upon credit terms.
The Company's shops operate under the name of the New Earl Scheib Paint and
Body Shop. The Company's shops are located in 145 cities throughout the United
States with 54 shops in California
In November, 1994, Donald R. Scheib was appointed as Chairman of the Board
and Daniel A. Seigel was employed as President and Chief Executive Officer and
elected to the Company's Board of Directors. Mr. Seigel resigned as President
and Chief Executive Officer effective December 31, 1998. Christian Bement, the
Company's Chief Operating Officer since February, 1995, was elected President
and Chief Executive Officer on January 1, 1999. Additionally, Philip Wm.
Colburn, a board member since 1992, was elected Chairman of the Board on January
1, 1999, replacing Donald Scheib who agreed to remain as a director until the
1999 Annual Meeting of Shareholders.
During the fiscal year ended April 30, 1995, ("fiscal 1995") the Company
implemented a comprehensive restructuring plan to reduce operating expenses and
to focus its resources on profitable operations. As part of this plan the
Company closed 84 unprofitable shops located primarily in the Midwestern and
Eastern United States and eliminated the executive, office and shop personnel
associated with those operations. The Company recorded a pre-tax charge of
$4,287,000 in fiscal 1995 for costs associated with the restructuring plan which
included, but was not exclusively related to, the closing of the unprofitable
paint shops.
During the fiscal year ended April 30, 1996, ("fiscal 1996") the Company
renovated and converted 137 of its shops to the New Earl Scheib Paint and Body
Shop Format (the "New Shop Format"). Conversion to a New Shop Format included
new paint and graphics, new exterior signage, a new customer information center,
the installation of a "dust" wall to separate the vehicle preparation area from
the vehicle detail and delivery area, and the installation of a new Infrared
Quartz Finish Drying System to dry the paint on the car. New Shop Format
conversions occurred in California during the first quarter of fiscal 1996.
Because of the significant comparable shop-for-shop sales increases in the
California New Shop remodels (New Shop remodels experienced a 37% comparable
shop-for-shop sales increase during the period from August 1, 1995, through
April 30, 1996) a decision was made to remodel the remainder of the Company's
shops to the New Shop Format.
The cost of converting shops to the New Shop Format during fiscal 1996 was
approximately $4.6 million which was financed from the sale of 22 Company owned
properties (which had previously been occupied by unprofitable paint and body
shops closed during the restructuring) and from internal cashflow.
The Company also restructured its operational management organization in
fiscal 1996 resulting in the Company's Division Managers supervising fewer shops
which improved the quality of the shop supervision and enabled the shop managers
to directly benefit from the Division Managers' years of experience.
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During the latter part of the fiscal year ended April 30, 1997 ("fiscal
1997"), the Company began an aggressive new shop expansion campaign with the
initial objective to expand in existing markets where the Company felt that it
underserved the market. Penetration in these markets will enable the Company to
open new shops without significantly increasing overhead expenses. During fiscal
1997, the Company opened 5 new shops.
During the fiscal year ended April 30, 1998 ("fiscal 1998"), the Company
opened 12 new shops. New shops incorporate much of the New Shop Format but also
include other improvements, where feasible, such as the installation of state of
the industry cross-draft or semi-downdraft paint booths with combination fully
enclosed dryers, the separation of the production process into three distinct
areas, vehicle preparation, masking and detail to further improve quality; and
the installation of exterior graphics to emphasize the Company's core business
and attractive prices.
During fiscal 1998, the Company implemented an extensive Division Manager
training program. This program is designed to attract and train individuals from
outside the industry for eventual promotion to a Division Manager position. The
program is considered a "fast track" program which involves a 4 to 12 month
training program.
During the fiscal year ended April 30, 1999 ("fiscal 1999"), Daniel Seigel
resigned as President and Chief Executive Officer and Christian Bement was
elected to those positions. Additionally, after the end of fiscal 1999, on May
3, 1999, the Company's Chief Financial Officer, John Branch, resigned from his
position. The Company has hired Charles Barrantes as Chief Financial Officer
effective August 2, 1999.
During fiscal 1999, the Company began operations in 19 new shops. These
shops are located in California, Arizona, Texas, Indiana, Illinois, Virginia,
Washington and Michigan. All of these new shops provide the Company with greater
penetration into these existing markets. The Company hopes by continuing to
increase shop concentration and market penetration, in some instances doubling
the number of shops in a market, it will be able to achieve economies of scale
and improve the Company's overall performance in these areas.
SERVICES
The Company currently offers primarily three paint packages which range in
price based upon the color of the paint, number of coats of paint applied,
additional services and length of warranty provided in each package. Customers
may also purchase options to the paint packages such as UV Supergloss,
Pearlescent paint colors and Euroclear(R) clear coat for an additional cost.
The Company paints vehicles on a production line basis. The vehicle is
sanded to prepare the surface for paint adhesion. Removal of scratches, chips,
rust and peeling also occurs at this time for an extra charge. The vehicle is
then air-blown using a high pressured air hose to remove excess dust. The
exposed chrome and glass areas are masked and the vehicle is spray painted in a
dust-free, fully filtered and sprinklered spray booth. The vehicle is then dried
in a either a semi-enclosed or fully enclosed Infrared Quartz Finish Drying
System. This drying process dries the paint by quartz infrared waves increasing
the metal temperature just enough to heat the paint such that the paint on the
vehicle dries from the inside to the outside. The quartz heat tubes utilize high
intensity electromagnetic waves to heat the metal and are controlled by infrared
sensors and computer aided temperature controls. Finally, the vehicle is
detailed, which involves removing the masking paper and tape, removing overspray
and reinstalling any accessories removed during the painting process.
In connection with its painting operations, the Company also performs, for
an additional cost, body and fender repair work as well as extra sanding and
preparation mentioned above. All body and fender work performed is incidental to
the painting process. Such body and fender work accounted for approximately 20%
of the Company's sales during fiscal 1999, 21% in fiscal 1998 and 22% in fiscal
1997.
During fiscal 1997, the Company began the manufacture and distribution of a
new EuroPaint(R) coating system. EuroPaint(R) is a true two (2) component
acrylic polyurethane coating which offers superior quality and performance.
EuroPaint(R) is characterized by having extremely high gloss and distinctness of
image, outstanding exterior durability and exceptional chemical resistance. This
type of paint is generally considered the highest quality after market paint and
far superior to many of the paint formulation used by the
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Company's competitors and is commonly used by many European luxury car
manufacturers. EuroPaint(R) was rated best in a blind test conducted by an
independent laboratory against the best paints used in popular production auto
painting. The paint test measured gloss (the ability of paint to reflect light),
distinctiveness of image (which represents the ability of the painted surface to
reflect images like a mirror) and the ability of the paint to resist harmful
chemicals and UV rays.
The Company also offers a product called EuroClear(R). EuroClear(R) is an
option which offers customers a true and separate clear coat with the same
superior quality and performance properties offered by EuroPaint(R).
EuroClear(R) enhances and intensifies the high gloss and distinctiveness of
image of EuroPaint(R) providing a very deep gloss look characteristic of
basecoat/clearcoat (two stage) paint systems.
Over the past few fiscal years, the Company's color offering was expanded
to include a new, unique line of colors which capture the glamour and allure of
pearlescence. Such new colors offer an iridescence and lustre creating a visual
effect which can only be achieved by the use of pearlescent pigments.
Pearlescent colors are two- and three-stage color systems, which offer customers
a unique production shop product.
During fiscal 1996, the Company introduced a new Company developed product
called UV Supergloss. This new product is sold as an additive for two of the
Company's paint packages. The UV Supergloss provides the car with a brighter
shine and is designed to protect the paint from the harmful effects of
Ultraviolet rays.
FLEET SERVICE
During the fourth quarter of fiscal 1998, the Company started up a fleet
sales department. The department currently consists of approximately 10 sales
people dedicated to developing multi-vehicle fleet accounts in designated
geographical regions. These accounts range from smaller neighborhood businesses
to large municipal, state, federal and national accounts. During fiscal 1999,
fleet sales totalled $1,432,000 versus $185,000 in the fourth quarter of fiscal
1998 (the only quarter of fiscal 1998 that fleet sales was operating).
RAW MATERIALS
Most of the raw materials used by the Company in manufacturing its paint,
including silicones, resins and pigments, are available from a number of
sources. A majority of such raw materials are provided to the Company by a
variety of wholesale chemical companies, including DuPont and Akzo-Nobel. The
Company has not encountered any major difficulty in obtaining adequate supplies
of its major raw materials and does not expect to encounter any such difficulty
in the foreseeable future.
By manufacturing its own paint and paint related products, including
primers and sealers, the Company is better able to ensure the quality of its
products, to comply with environmental regulations and to control product
availability and cost. However, if necessary, automobile paint can be obtained
from other wholesale manufacturers.
SEASONALITY
The Company's sales are seasonal in nature. Because of weather conditions
and Christmas holidays, sales for the months of November, December, January and
February are usually lower than the sales in the remaining months of the year.
As a result, a proportionately greater share of the Company's sales and earnings
have historically occurred in the first half of its fiscal year.
COMPETITION
The automobile painting business in which the Company is engaged is highly
competitive. The Company competes not only with nationally and regionally based
companies engaged in production style automobile painting utilizing techniques
similar to its own, but also with thousands of individual automobile paint and
body shops. Both types of competitors generally price their services much higher
than those charged by the Company.
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In the field of non-franchised production line automobile painting, the
Company believes that it is substantially larger than any of its competitors and
that its experience, and the reasonable prices of its services, will enable it
to continue to compete effectively. The Company expects that its new shop
expansion, developing fleet sales, ongoing shop renovations and technological
improvements, operational restructuring and improved training programs along
with new products will enable it to continue it to be an effective competitor.
TRADEMARKS
The Company's success is dependent upon, among other things, its name. The
Company relies primarily on a combination of the protections provided in
applicable copyright, trademark and trade secret laws. The Company owns various
trademarks but believes that Earl Scheib(R), Europaint(R), and Euroclear(R) are
material to the business of the Company.
RESEARCH AND DEVELOPMENT
The Company is engaged in certain research and development to continue to
improve its existing paint products, update product lines, change formulations
in order to comply with changing environmental regulations, and develop new
products which can be introduced to the shops without significant cost or
training such as the Europaint(R) and Euroclear(R), UV Supergloss and new colors
introduced during fiscal 1997 and 1996. The Company constantly reviews new
products and techniques developed by its suppliers and others in its and related
industries for their applicability to the Company's operations. Although the
Company's research and development costs are increasing to accomplish these
objectives, such expenditures during the three years ended April 30, 1999 were
not a significant percentage of sales.
COMPLIANCE WITH ENVIRONMENTAL REGULATIONS
The Company's automobile painting and paint manufacturing operations are
subject to federal, state and local environmental regulations in many of the
areas in which it operates. The Company believes its operations substantially
comply with existing regulations in those geographic areas in which it now
operates. The Company, since it manufactures its owns products, has the ability
to modify and/or develop paint and paint related product formulations to
reasonably ensure continued compliance with new and changing environmental
regulations. In addition, since the Company primarily paints vehicles in its own
colors, there is little waste product produced.
EMPLOYEES
At April 30, 1999, the Company employed approximately 1,172 employees, of
which 346 were sales, administrative, management or executive personnel and 826
were production personnel. Production employees are represented by the
International Brotherhood of Teamsters under a collective bargaining agreement
which extends through September 15, 2001. None of the Company's executive,
administrative, shop management or clerical personnel are represented by a
union. Management believes its employee relations are good.
YEAR 2000 COMPLIANCE
Many computer systems and software products, as well as certain hardware
and equipment containing date sensitive data, were structured to utilize a
two-digit date field meaning that they may not be able to properly recognize
dates in the year 2000. This could result in significant system and equipment
failures. Beginning in fiscal 1997 the Company began a process of evaluating
its, as well as its critical vendors' systems to identify potential year 2000
issues and implement solutions. It was decided that the best approach would be
to replace the majority of the Company's old information systems.
Starting in late fiscal 1997 and proceeding during most of fiscal 1999, the
Company has been undergoing an accelerated installation of new systems. At the
end of fiscal 1998, the majority of these systems had been operating for over
nine months. During fiscal 1999, the Company installed new systems in its
accounting department and a credit system to support its new fleet business. The
Company believes that the majority, if
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not all of its systems, are year 2000 compliant; however, in this regard, it is
relying upon representations made by its software and hardware vendors, most of
whom are large, well-known international companies. In performing this
significant technology transformation, the Company has relied upon both internal
and external resources. The estimated cost to address year 2000 issues has not,
to date, and is not expected to have a material impact on the Company's
business, operations or financial condition.
The Company has been in communications with major suppliers, financial
institutions, insurers and others with whom it conducts business to determine
that they will be year 2000 compliant. The Company has received representations
from these outside parties indicating they believe they currently are or will be
year 2000 compliant prior to the end of 1999. There can be no assurance,
however, that the systems of third parties on which the Company's systems rely
will be timely converted or that any such failure to convert by another company
would not have an adverse effect on the Company's systems.
The above discussion regarding costs and risks is based on the Company's
best current estimate given information that is currently available to it, and
is subject to change.
ITEM 2. PROPERTIES
The Company owns the land and buildings occupied by 69 of the Company's
operating shops as of April 30, 1999. The remaining 105 of the Company's 174
shops were leased from outside third parties. The 174 shops are located in 145
cities in 31 states. In fiscal 1999, the Company began operations in 19 new
shops and ceased operations in 6 shops.
Leases for shop premises vary as to their terms, rental provisions,
expiration dates and the existence of renewal options. The number of years
remaining on leases for the Company's shops (excluding unexercised options)
range from a month to month tenancy to 15 years. All of the leases, with two
exceptions, have fixed rentals with no additional rents based upon shop sales.
Many leases also require the Company to pay all or a portion of the real estate
taxes, insurance charges and maintenance expenses relating to the leased
premises. The Company maintains fire and liability insurance as well as umbrella
earthquake coverage for its shops and other real estate interests.
The Company secures sites for new stores by a variety of methods, including
lease, purchase, assignment or sublease of existing facilities, build-to-suit
leases, or purchase and development of sites that may be owned by the Company or
sold and leased back by the Company under sale-and-leaseback arrangements. In
many cases, the Company is able to lease or sublease existing buildings that
have been previously used for other purposes, such as automobile repair shops or
retail establishments. These sites must be suitable for the Company's needs, at
a lease rate that is within the Company's guidelines and without the need for
substantial expenditures to convert the facilities to the Company's needs. In
connection with the opening of new shops, the Company generally makes capital
investments and incurs expenditures (excluding expenditures to purchase land,
buildings or leasehold interest) of approximately $175,000. These costs consist
of construction of improvements, paint and supply inventories, fixtures,
equipment, signs and pre-opening expense.
The majority of the Company's stores are in stand-alone sites on main
streets and have adjacent parking facilities. Store hours are generally from
7:30 a.m. to 6:00 p.m. Monday through Friday and 8:00 a.m. to 12:00 p.m. on
Saturday. The Company's shops are generally 6,000 square feet with new shops
ranging from approximately 3,500 square feet to 7,000 square feet and existing
shops ranging in size from approximately 3,500 square feet to approximately
12,000 square feet.
As of April 30, 1999, the Company had 2 parcels of real estate for sale.
Both properties sold during the first quarter of fiscal 2000 for a net of
$342,888. The properties had a net book value at April 30, 1999, of
approximately $338,875 which are shown in the financial statements as Property
held for sale. The gain on the sale of these properties was $4,013 and will be
recognized in the first quarter of fiscal 2000.
The Company owns its corporate offices, located at 8737 Wilshire Boulevard,
Beverly Hills, California 90211. The facility has three floors and approximately
10,500 square feet of office space. In addition, the Company owns a
manufacturing and warehousing facility in Springfield, Missouri. The Company
manufac-
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tures and warehouses paint and related products used by the shops (and
warehouses other necessary supplies) in this facility until needed by the
Company's shops. This facility occupies approximately 30,600 square feet.
The Company believes its operating properties are in good operating
condition.
ITEM 3. LEGAL PROCEEDINGS
The Company is involved in certain legal proceedings and claims arising in
the ordinary course of its business. Management believes that the final
disposition of such matters should not have a material adverse effect on the
Company's operations and/or financial position.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
PART II
The Company's Annual Report to Shareholders for the year ended April 30,
1999 ("1999 Annual Report") is filed as Exhibit 13 to this Report on Form 10-K.
The responses to Items 5, 6, 7 and 8 are contained in the 1999 Annual Report on
the pages noted and are specifically incorporated herein by reference in this
Report on Form 10-K. With the exception of these items, the 1999 Annual Report
is not deemed filed as a part of this Report.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER
MATTERS
"Market Information" appearing on page 15 of the 1999 Annual Report is
incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
"Selected Financial Data" appearing on page 14 of the 1999 Annual Report is
incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" appearing on pages 2 through 4 of the 1999 Annual Report is
incorporated herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The consolidated financial statements of the Company appearing on pages 5
through 13 of the 1999 Annual Report are incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
The Company, effective April 20, 1999, dismissed Deloitte & Touche, LLP,
independent auditors, as its principal independent accountant. The dismissal was
recommended by the Audit Committee of the Board of Directors.
Deloitte & Touche, LLP's report on the Company's financial statements for
either of the past two years did not contain an adverse opinion or disclaimer of
opinion, nor was the report qualified or modified as to uncertainty, audit scope
or accounting principles.
Effective April 22, 1999, following the recommendation of the Audit
Committee, the Company engaged Arthur Andersen, LLP, independent public
accountants, as its new principal independent accountant to audit the Company's
financial statements. The Company did not consult Arthur Andersen, LLP during
its two most recent fiscal years with regard to any of the matters described in
Item 304(a)(2) of Regulation S-K.
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PART III
ITEMS 10., 12., 13. AND 14.
The information required by these items is contained in the Company's
definitive Proxy Statement dated July 29, 1999 which relates to election of the
Company's directors and which was filed within the Commission within 120 days
after the close of the Company's fiscal year pursuant to Regulation 14A of the
Securities Exchange Act of 1934.
PART IV
ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) 1. FINANCIAL STATEMENTS
The following consolidated financial statements of the Company and Report
of Independent Auditors, appearing on pages 5 through 13 of the 1999 Annual
Report, are filed as part of this Report on Form 10-K:
For the Fiscal Years Ended April 30, 1999, 1998 and 1997:
Consolidated Statements of Operations
Consolidated Statements of Shareholders' Equity
Consolidated Balance Sheets as of April 30, 1999 and 1998
Consolidated Statements of Cash Flows
Report of Independent Public Accountants
2. FINANCIAL STATEMENT SCHEDULES
None.
3. EXHIBITS
The Exhibits required to be filed hereunder are indexed on page E-1.
(b) REPORTS ON FORM 8-K
The Company filed a Current Report on Form 8-K on April 23, 1999 disclosing
a change in its certifying accountant.
"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995
The statements which are not historical facts contained in this Annual
Report on Form 10-K are forward looking statements that involve risks and
uncertainties, including, but not limited to, the effect of weather, the effect
of economic conditions, the impact of competitive products, services and
pricing, capacity and supply constraints or difficulties, changes in laws and
regulations applicable to the Company, the impact of Year 2000 hardships, the
impact of the Company's Europaint(R), the impact of advertising and promotional
activities, the impact of the Company's expansion and fleet sales and the impact
of various tax positions taken by the Company.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
EARL SCHEIB, INC.
Date: July 29, 1999 By /s/ CHRISTIAN K. BEMENT
------------------------------------
Christian K. Bement
President
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated:
SIGNATURES TITLE DATE
---------- ----- ----
By /s/ CHRISTIAN K. BEMENT President and Director July 29, 1999
------------------------------------------------- [Chief Executive Officer]
Christian K. Bement
By /s/ PHILIP WM. COLBURN Chairman of the Board of July 29, 1999
------------------------------------------------- Directors
Philip Wm. Colburn
By /s/ DANIEL A. SEIGEL Director July 29, 1999
-------------------------------------------------
Daniel A. Seigel
By /s/ DONALD R. SCHEIB Director July 29, 1999
-------------------------------------------------
Donald R. Scheib
By /s/ ALEXANDER L. KYMAN Director July 29, 1999
-------------------------------------------------
Alexander L. Kyman
By /s/ STUART D. BUCHALTER Director July 29, 1999
-------------------------------------------------
Stuart D. Buchalter
By /s/ DAVID EISENBERG Director July 29, 1999
-------------------------------------------------
David Eisenberg
By /s/ JOHN K. MINNIHAN Vice President -- Finance July 29, 1999
------------------------------------------------- [Principal Financial and
John K. Minnihan Accounting Officer]
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EXHIBIT INDEX
SEQUENTIAL
EXHIBIT NO. PAGE NO.
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3(a)(1) Certificate of Incorporation of Earl Scheib, Inc., dated
December 22, 1961, as amended, filed as Exhibit 3(a) to
Registrant's Registration Statement No. 2-21540, effective
as of August 7, 1963, and hereby incorporated herein by
reference...................................................
3(a)(2) Amendment to Certificate of Incorporation dated October 28,
1969, filed as Exhibit 1 to Registrant's Form 8-K Current
Report for the month of October, 1969 and hereby
incorporated herein by reference............................
3(a)(3) Amendment to Certificate of Incorporation dated August 16,
1971, filed as Exhibit 1 to Registrant's Form 8-K Current
Report for the month of August, 1971 and hereby incorporated
herein by reference.........................................
3(a)(4) Amendment to Certificate of Incorporation dated November 4,
1983, filed as Exhibit 3(a)(1) to Registrant's Form 8-K
Current Report for the month of August, 1983 and hereby
incorporated herein by reference............................
3(a)(5) Amendment to Certificate of Incorporation dated October 2,
1986, as set forth in the Proxy Statement dated July 22,
1986 and Registrant's 10-Q Quarterly Report for the quarter
ended July 31, 1986 and hereby incorporated herein by
reference...................................................
3(b) Amended and Restated Bylaws of Earl Scheib, Inc., filed as
an exhibit to Registrant's Current Report on Form 8-K dated
August 15, 1995, and hereby incorporated herein by
reference...................................................
10(d) Earl Scheib, Inc. 1982 Incentive Stock Option Plan, filed as
Exhibit 10(d) to Registrant's Annual Report on Form 10-K for
the fiscal year ended April 30, 1982 and hereby incorporated
herein by reference.........................................
10(i) Stock Option Agreement dated as of January 10, 1995 between
Registrant and Christian Bement filed as Exhibit 10(i) to
the Registrant's 1995 Form 10-K and hereby incorporated
herein by reference.........................................
10(j) Earl Scheib, Inc. 1994 Performance Employee Stock Option
Plan, June 27, 1994 filed as Exhibit 10(l) to the
Registrant's 1995 Form 10-K and hereby incorporated herein
by reference................................................
10(k) Earl Scheib, Inc. 1994 Board of Directors Stock Option Plan,
June 27, 1994 filed as Exhibit 10(m) to the Registrant's
1995 Form 10-K and hereby incorporated herein by
reference...................................................
10(l) Agreement for Issuance of Letters of Credit dated as of
February 16, 1995 between Registrant and City National Bank,
filed as Exhibit 10(a) to Registrant's Quarterly Report on
Form 10-Q for the quarter ended January 31, 1995, and hereby
incorporated herein by reference............................
10(m) Amended Supplemental Terms Letter dated April 29, 1999
between City National Bank and Registrant...................
13 1999 Annual Report to Stockholders of Earl Scheib, Inc. (not
deemed filed except to the extent that sections thereof are
specifically incorporated into this report on Form 10-K by
reference)..................................................
22 Subsidiaries of the Registrant..............................
23.1 Consent of Current Independent Auditors.....................
23.2 Consent of Prior Independent Auditors.......................
99.1 Report of Prior Independent Auditors........................
27.1 Financial Data Schedule.....................................
E-1
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EARL SCHEIB INC. AND SUBSIDIARIES
AVAILABILITY OF EXHIBITS
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The Company will furnish upon
request copies of the exhibits
indicated on page E-1 of the Form
10-K at a cost of 25c per page,
which is the reasonable cost to
the Company in fulfilling the
request.