-----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, VMWLfHdHhlFBSDAoUoV/PEZDzOSwiHViMBNVXZ8wygxtc7sJSfeoy9evpjzt+a+9 r6NxAoCGx/FxUMTodRCBuA== 0000109446-97-000005.txt : 19970221 0000109446-97-000005.hdr.sgml : 19970221 ACCESSION NUMBER: 0000109446-97-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970211 SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ZURN INDUSTRIES INC CENTRAL INDEX KEY: 0000109446 STANDARD INDUSTRIAL CLASSIFICATION: COGENERATION SERVICES & SMALL POWER PRODUCERS [4991] IRS NUMBER: 251040754 STATE OF INCORPORATION: PA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-05502 FILM NUMBER: 97524918 BUSINESS ADDRESS: STREET 1: ONE ZURN PL STREET 2: P O BOX 2000 CITY: ERIE STATE: PA ZIP: 16514 BUSINESS PHONE: 8144522111 MAIL ADDRESS: STREET 1: ONE ZURN PLACE STREET 2: P O BOX 2000 CITY: ERIE STATE: PA ZIP: 16514 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 X Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended December 31, 1996 ___ 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 1-5502 ZURN INDUSTRIES, INC. IRS Employer State of Address and Identification Incorporation Telephone Number Number Pennsylvania One Zurn Place 25-1040754 Erie, Pennsylvania 16505 814-452-2111 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, 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. February 10, 1997 -- Common Stock, $.50 Par Value -- 12,352,458 -1- PART I - FINANCIAL INFORMATION CONSOLIDATED FINANCIAL POSITION (Thousands) December 31, March 31, 1996 1996 Assets Current assets Cash and equivalents $49,636 $ 16,195 Marketable securities 39,815 13,836 Accounts receivable 56,402 93,713 Inventories Finished products 40,846 45,386 Work in process 1,518 3,708 Raw materials and supplies 1,680 5,430 Contracts in process 12,354 15,229 56,398 69,753 Income taxes 23,735 32,340 Discontinued operations' net assets 14,964 57,253 Other current assets 4,113 3,904 Total current assets 245,063 286,994 Property, plant, and equipment 82,705 102,295 Less allowances for depreciation and amortization 47,065 60,241 35,640 42,054 Investments 34,752 37,611 Other assets 29,094 27,988 $344,549 $394,647 Liabilities and Shareholders' Equity Current liabilities Trade accounts payable $18,534 $ 48,441 Other current liabilities 38,155 64,717 Total current liabilities 56,689 113,158 Long-term obligations 6,304 6,711 Retirement obligations 43,106 43,823 Shareholders' equity Common stock 6,285 6,285 Other shareholders' equity 232,165 224,670 238,450 230,955 $344,549 $394,647 See notes to consolidated financial statements. -2- CONSOLIDATED OPERATIONS (Thousands Except Per Share Amounts) Three Months Ended Nine Months Ended December 31 December 31 1996 1995 1996 1995 Net sales $65,997 $76,399 $230,070 $206,742 Cost of sales 45,891 57,402 164,378 149,177 Marketing and administration 13,834 13,029 42,793 38,737 Interest income (887) (837) (2,428) (2,519) Interest expense 441 293 1,092 962 Other income (1,369) (608) (2,997) (2,198) Continuing operations income before income taxes 8,087 7,120 27,232 22,583 Income taxes 3,210 2,690 10,300 8,660 Continuing operations income 4,877 4,430 16,932 13,923 Discontinued operations (Loss) from operations (936) (9,164) (1,705) Gain on disposal 2,164 2,764 Net income $ 7,041 $ 3,494 $ 10,532 $ 12,218 Earnings per share Continuing operations $.39 $ .36 $1.36 $1.13 Discontinued operations .18 (.08) (.51) (.14) Net Income $.57 $ .28 $ .85 $ .99 Average shares outstanding 12,510 12,416 12,411 12,382 Cash dividends declared per common share $.10 $.10 $.30 $.30 See notes to consolidated financial statements. -3- CONSOLIDATED CASH FLOWS (Thousands) Nine Months Ended December 31 1996 1995 Operations Net income $ 10,532 $ 12,218 Operating assets and liabilities 12,818 (7,741) Depreciation and amortization 4,383 3,718 Discontinued operations (25,374) (10,745) Miscellaneous (2,284) (574) 75 (3,124) Investing Marketable securities (25,925) 32,493 Capital expenditures (4,389) (7,307) Purchase of business (5,967) Sales of operations 2,706 376 Discontinued operations 66,706 (2,848) Miscellaneous 622 797 39,720 17,544 Financing Dividends paid (3,703) (5,181) Debt payments (626) (1,112) Stock options exercised 160 Discontinued operations (2,185) (980) (6,354) (7,273) Cash and equivalents Increase 33,441 7,147 Beginning of year 16,195 6,360 End of period $ 49,636 $ 13,507 See notes to consolidated financial statements. -4- NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The statements of consolidated operations and cash flows have been restated as the result of the decisions made in the fourth quarter of fiscal 1996 to sell the Lynx Golf and Mechanical Power Transmission segments and in the second quarter of fiscal 1997 to sell the Power Systems segment businesses. The disposition of the Lynx Golf and Mechanical Power Transmission segments was completed in the current year's third quarter with an after-tax gain of $7,164 being realized, of which $2,164 has been recognized as a result of the second quarter decision to discontinue the Power Systems segment businesses. Last year's $600 fourth quarter discontinued operations loss provision was reversed in the second quarter. In the opinion of the Company, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the results for the interim periods presented. The results of operations for the nine months ended December 31, 1996 are not necessarily indicative of the results to be expected for the full year. Earnings per share are based on income and the average shares of common stock and dilutive stock options outstanding during the period. At December 31, 1996, $19.2 million of letters of credit were outstanding under the $100 million commitment from a group of banks for letters of credit and revolving credit loans and letters of credit issued under other arrangements amounted to $2.4 million. If the March 1996 repeal of the State of Illinois Retail Rate Law of 1987 is not reversed and the assets of two power plants being constructed by the Company, including debt funding by the owner, are insufficient, a pretax loss of up to $14 million could be sustained by the discontinued Power Systems businesses for which no provision has been made as management believes the Company's costs will be recovered. There are various claims, legal, and environmental proceedings which management believes will have no material effect on the Company's financial position or results of operations when they are resolved. A subsidiary of the Company merged into Eljer Industries, Inc. on January 27, 1997 following a $24.00 per share cash tender offer for all the outstanding common stock of Eljer. In connection with the merger, the Company's existing agreement for letters of credit and revolving credit loans was terminated and a credit agreement was entered into by the Company and an Eljer subsidiary. Under the agreement, the Company may borrow $90 million to finance the purchase of Eljer common stock and $50 million for general corporate purposes, including letters of credit aggregating no more than $40 million until 1998 and $30 million thereafter. The Eljer subsidiary may borrow $110 million to refinance existing debt and fund the trust contemplated by the Third Amended Plan of Reorganization under Chapter 11 of the United States Bankruptcy code for its subsidiary, United States Brass Corporation. -5- Substantially all of the Company's and Eljer's domestic accounts receivable, inventories, and property, plant, and equipment (other than those of the Power Systems businesses and certain other underutilized assets which the Company expects to sell) have been pledged as security for loans and letters of credit under the credit agreement. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Business Restructuring The decision to sell the Power Systems businesses was made in the second quarter of fiscal 1997 and, accordingly, they and the Lynx Golf and Mechanical Power Transmission segments, whose disposition was completed in the third quarter, are reported in the consolidated financial statements as discontinued operations. The assets and liabilities of the discontinued operations have been removed from the consolidated accounts and are presented in the statement of financial position as a single net asset (Lynx Golf and Mechanical Power Transmission at March 31, 1996 and the Power Systems segment at December 31, 1996) resulting in significant decreases in accounts receivable, inventories, property, plant, and equipment, and current liabilities at December 31, 1996 compared to the amounts reported for previous periods. The statements of consolidated operations and cash flows have been restated to present separately for all periods the continuing operations of the Water Control segment, now the Company's dominant segment, and the discontinued operations. Financial Condition Liquid assets increased from $30,031 at March 31, 1996 to $89,451 at December 31, 1996, and the discontinued operations' net assets decreased, as the result of completing the sales of the Lynx Golf and Mechanical Power Transmission segments. An income tax refund and the reversal of deferred income taxes on the sale of discontinued operations reduced the current asset. The property, plant, and equipment decrease is attributable to discontinuing the Power Systems businesses and the sale of Gary Concrete. Accelerated collection of long-term notes receivable reduced the Company's investments. The status of two power plant construction projects and the litigation disclosed in the notes to consolidated financial statements are not expected to have a future material effect on the Company's financial position. Results of Operations The Water Control segment is now the Company's dominant industry segment. Its sales increase for the nine months was derived from plumbing products and fire protection systems. Half of the more than 20% year-to-date increase in sales of plumbing products was attributable to market gains and almost half from the acquisition last fall of Sanitary-Dash with the balance being derived from internally developed new products. As a result of a low backlog and the sale of Gary Concrete, revenues from water resource construction projects declined sharply in the current year's third quarter and more than offset the revenue gains in the first six months which were derived from substantially completing a large contract. -6- Gross profit margin percentages were larger this year as plumbing products contributed a greater proportion of the total revenues. Marketing and administration expenses were up primarily as the result of commissions on the increased plumbing products sales and several items which lowered 1995's costs compared to those incurred this year. The Water Control segment backlog of unfilled orders was: December 1996 - $105 million; September 1996 - $66 million; December 1995 - $111 million. The following tables set forth the fiscal 1997 an 1996 quarterly data (thousands except per share amounts) restated for the effects of discontinuing the Lynx Golf and Mechanical Power Transmission segments and the Power Systems segment businesses. Year Ending March 31, 1997 First Second Third Quarter Quarter Quarter Net sales $82,557 $81,516 $65,997 Gross profit 22,959 22,627 20,106 Continuing operations income 6,521 5,534 4,877 Discontinued operations (4,309) (4,255) 2,164 Net income 2,212 1,279 7,041 Earnings Per Share Continuing operations $ .53 $ .44 $.39 Net income .18 .10 .57 Year Ended March 31, 1996 First Second Third Fourth Quarter Quarter Quarter Quarter Net sales $60,156 $70,187 $76,399 $77,941 Gross profit 18,836 19,732 18,997 21,813 Continuing operations income 4,928 4,565 4,430 7,604 Discontinued operations (279) (490) (936) (3,152) Net income 4,649 4,075 3,494 4,452 Earnings Per Share Continuing operations $ .40 $ .37 $ .36 $ .61 Net income .38 .33 .28 .36 Fiscal 1996 fourth quarter includes unusual gains on sales of underutilized assets and an unusually low effective tax rate. -7- PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS See Form 10-Q, Part II, Item 1 for the quarterly period ended September 30, 1996. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K Exhibits The exhibits listed in the Exhibit Index to this report on Form 10-Q are incorporated herein by reference. Management contracts and compensatory plan arrangements are preceded by an asterisk (*) in the Exhibit Index. Reports on Form 8-K The following reports were filed during the quarter for which this report is filed: October 10, 1996 incorporating a news release announcing the intention to sell the Power Systems construction and equipment supply businesses. October 22, 1996 incorporating a news release announcing that terms had been agreed to for the sale of the Mechanical Power Transmission Group to Constellation Capital Partners LLC. December 16, 1996 incorporating a new release announcing the execution of a definitive merger agreement in which an affiliate of the Company agreed to acquire all of the outstanding common stock of Eljer Industries, Inc. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ZURN INDUSTRIES, INC. (Registrant) February 11, 1997 /s/ Dennis Haines Dennis Haines General Counsel and Secretary February 11, 1997 /s/ John E. Rutzler III John E. Rutzler III Vice President-Controller -8- EXHIBIT INDEX 3 Articles Of Incorporation And By-laws Restated Articles of Incorporation with Amendments through Incorporated April 22, 1996 filed as Exhibit 3.1 to Form 10-K for the by reference year ended March 31, 1996 By-laws as of August 1995 filed as Exhibit 3.1 to Form Incorporated 10-Q for the quarter ended September 30, 1995 by reference 4 Instruments Defining The Rights Of Security Holders, Including Indentures Description of Common Stock contained in the prospectus Incorporated dated July 26, 1972 beginning on page 18 ("Description of by reference Capital Stock") forming a part of Amendment No. 3 to the Form S-1 Registration Statement No. 2-44631 Description of Common Stock as set forth in the Restated Incorporated Articles of Incorporation with Amendments through by reference April 22, 1996 filed as Exhibit 3.1 to Form 10-K for the year ended March 31, 1996 Description of Preferred Share Purchase Rights contained Incorporated in the Form 8-A Registration Statement dated May 17, 1996 by reference 10 Material Contracts * 1986 Stock Option Plan filed as Exhibit 28A to Form S-8 Incorporated Post-Effective Amendment No. 1 Registration Statement No. by reference 33-19103 * 1989 Directors Stock Option Plan filed as Exhibit 28 to Incorporated Form S-8 Registration Statement No. 33-30383 by reference * 1991 Stock Option Plan filed as Exhibit 28 to Form S-8 Incorporated Registration Statement No. 33-49224 by reference * 1995 Directors Stock Option Plan filed as Exhibit 99 to Incorporated Form S-8 Registration Statement No. 33-65219 by reference * Supplemental Executive Retirement Plan of Zurn Incorporated Industries, Inc. filed as Exhibit 10.1 to Form 10-Q for by reference the quarter ended December 31, 1994 10.16* 1986 Retirement Plan for Outside Directors of Zurn Industries, Inc. as amended June 3, 1996 -9- * Agreements Relating to Employment dated June 5, 1989 with Incorporated J.A. Zurn filed as Exhibit 10H to Form 10-Q for the by reference quarter ended June 30, 1989; dated October 17, 1994 with R.R. Womack filed as Exhibit 10.2 to Form 10-Q for the quarter ended December 31, 1994; dated May 1, 1995 with D.L. Butynski and July 1, 1995 with J.R. Mellett filed as Exhibit 10.8 to Form 10-Q for the quarter ended June 30, 1995; dated August 14, 1995 with F.E. Sheeder filed as Exhibit 10.11 to Form 10-Q for the quarter ended September 30, 1995 * Employment Agreement dated January 22, 1996 with R.R. Incorporated Womack filed as Exhibit 10.13 to Form 10-Q for the by reference quarter ended December 31, 1995 * Zurn Industries, Inc. Deferred Compensation Plan for Non- Incorporated Employee Directors filed as Exhibit 19E to Form 10-Q for by reference the quarter ended June 30, 1989 * Zurn Industries, Inc. Deferred Compensation Plan for Incorporated Salaried Employees filed as Exhibit 10.3 to Form 10-Q for by reference the quarter ended December 31, 1994 * Zurn Industries, Inc. Optional Deferment Plan for Incorporated Incentive Compensation Plan Participants filed as Exhibit by reference 10.4 to Form 10-Q for the quarter ended December 31, 1994 * Zurn Supplemental Pension Plan filed as Exhibit 10.5 to Incorporated Form 10-Q for the quarter ended December 31, 1994 by reference * Indemnity Agreements dated August 14, 1986 with E.J. Incorporated Campbell and J.A. Zurn filed as Exhibit 19J to Form 10-Q by reference for the quarter ended September 30, 1986; dated October 20, 1986 with J.E. Rutzler III filed as Exhibit 10B to Form 10-Q for the quarter ended December 31, 1988; dated January 25, 1993 with W.E. Butler, April 1, 1993 with D. Haines, and August 6, 1993 with Z. Baird filed as Exhibit 10A to Form 10-Q for the quarter ended June 30, 1993; dated October 17, 1994 with R.R. Womack filed as Exhibit 10.6 to Form 10-Q for the quarter ended December 31, 1994; dated May 1, 1995 with D.L. Butynski, June 8, 1995 with R.D. Neary, and July 1, 1995 with J.R. Mellett filed as Exhibit 10.9 to Form 10-Q for the quarter ended June 30, 1995; dated August 14, 1995 with F.E. Sheeder filed as Exhibit 10.12 to Form 10-Q for the quarter ended September 30, 1995; dated October 30, 1995 with M.K. Brown filed as Exhibit 10.14 to Form 10-Q for the quarter ended December 31, 1995 -10- * Irrevocable Trust Agreements for the Grantor's: 1986 Incorporated Retirement Plan for Outside Directors of Zurn Industries, by reference Inc.; Deferred Compensation Plan for Non-Employee Directors; Supplemental Executive Retirement Plan for Zurn Industries, Inc.; Zurn Industries, Inc. Supplemental Pension Plan for Participants in the Deferred Compensation Plan for Salaried Employees; Deferred Compensation Plan for Salaried Employees; Optional Deferment Plan for Incentive Compensation Plan Participants filed as Exhibit 19I to Form 10-Q for the quarter ended September 30, 1986 * Second Irrevocable Trust Agreement for the Grantor's Incorporated Indemnity Agreements filed as Exhibit 10A to Form 10-Q by reference for the quarter ended December 31, 1988 * Incentive Compensation Plan filed as Exhibit 10.15 to Incorporated Form 10-K for the year ended March 31, 1996 by reference 11 Statement Re Computation Of Per Share Earnings Computation of Earnings Per Share 27 Financial Data Schedule 27.1 Financial Data Schedule Quarter Ended December 31, 1996 SEC Edgar Filing Only 27.2 Restated Financial Data Schedule Quarters Ended June 30 SEC Edgar and September 30, 1996 Filing Only 27.3 Restated Financial Data Schedule Year Ended SEC Edgar March 31, 1996 Filing Only * - Management contracts and compensatory plan arrangements. -11- EX-10.16 2 EXHIBIT 10.16 - 1986 RETIREMENT PLAN FOR OUTSIDE DIRECTORS EXHIBIT 10.16 1986 RETIREMENT PLAN FOR OUTSIDE DIRECTORS OF ZURN INDUSTRIES, INC. (Adopted May 19, 1986 for Directors first elected after 1/1/86) (Terminated August 2, 1996 for subsequently elected Directors) 1. ELIGIBILITY Non-Management Directors (Directors) who have completed five (5) years of Board Service prior to August 2, 1996 will become eligible for accrued benefits under the 1986 Retirement Plan for Outside Directors of Zurn Industries, Inc. (Plan) upon retirement or upon becoming totally disabled, whichever occurs first. Payment of benefits may not begin before age 65, and not until retirement from the Board. The mandatory retirement age for Directors elected after February 12, 1981 is 72. 2. BENEFIT AMOUNT The annual benefit for each eligible Director shall be 50% of the annual cash retainer fee in effect at the time of retirement. 3. PAYMENT DURATION Benefits are payable for life, or for the number of years of Board Service, whichever is the lesser. 4. SURVIVORS There shall be no benefits payable to survivors of eligible Directors other than those benefits payable during the lifetime of the retired Director. 5. CONDITIONS FOR CONTINUING PAYMENTS Retired Outside Directors receiving a benefit under the 1986 Retirement Plan are required to provide consulting advice to the Company when requested by the Company; and may not compete with the Company in its businesses. 6. CONTRIBUTIONS Outside Directors will make no monetary contribution toward the cost of funding the Plan. -12- Retirement Plan for Outside Directors (1986) Page 2 The Company will pay the full cost of providing benefits under the Plan. 7. VESTING Upon becoming eligible for benefits under the Plan, each Director shall be vested 100% in the accrued Benefit Amount provided herein, payable to the Director in accordance with the Plan and no modification, amendment or termination of the Plan shall impair the obligation of the Company to make payments of such benefits. 8. TRUST The Company shall establish a Trust with respect to the Plan and designate a Trustee selected by the Chief Executive Officer. The Company shall from time to time, but at least annually, deliver to the Trustee cash and/or securities equal in value to the current value of all accrued benefits of each participant as determined by an independent actuary selected by the Company. The Trust funds shall at all times be subject to claims of general creditors of the Company in the event of bankruptcy or insolvency. 9. CHANGE IN CONTROL In the event of a Change in Control of the Company, then each and every Director and retired Director or survivor who is eligible to receive benefits under the Plan (participant) shall immediately receive a lump sum payment equal to the present value of his or her vested benefit as calculated by the independent enrolled actuary of the Pension Plan using the same rates and assumptions as used with the Pension Plan. For this purpose "vested benefit" shall be each active participant's benefit as if such participant had completed at least five years of service as a Director. A Change in Control shall be deemed to occur if: (a) any "person" (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended [the "Exchange Act"], other than the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company, or any Company owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of Common Stock of the Company) becomes the "beneficial owner" (as defined in Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of the Company representing twenty percent (20%) or more of the combined voting power of the Company's then outstanding securities; -13- Retirement Plan for Outside Directors (1986) Page 3 (b) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors, and any new director (other than a director designated by a person who has entered into an agreement with the Company to effect a transaction described in clauses (a), (c) or (d) of this Section) whose election by the Board of Directors or nomination for election by the Company's shareholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved cease for any reason to constitute a majority thereof; (c) the shareholders of the Company approve (1) a merger or consolidation of the Company with any other company, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation or (2) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no "person" (as hereinabove defined) acquires more than fifty percent (50%) of the combined voting power of the Company's then outstanding securities; or (d) the shareholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all of substantially all of the Company's assets. 10. UNVESTED BENEFITS AT PLAN TERMINATION Directors who have not retired and have not completed five (5) years of Board Service prior to August 2, 1996 shall receive as of August 2, 1996 the net present value of their unvested accrued benefits as of August 2, 1996 in the form of Common Stock of the Company which shall be restricted for a period (the "Restricted Period") of five years or, if earlier, until the first to occur of the events set forth below; provided, however the restrictions shall remain in effect for not less than six months from the date of the award. (a) the Director attains age 65 and completes five years of service as a Director, including service prior to the date of the award; (b) the Director's service on the Board terminates as a result of not being nominated for re-election by the Board, but not as a result of the Director's declining to serve again; -14- Retirement Plan for Outside Directors (1986) Page 4 (c) the Director's service on the Board terminates because the Director, although nominated for re-election by the Board, is not re- elected; (d) the Director is unable to serve because of disability; (e) the Director dies; or (f) a "Change in Control" as defined in the Plan. If the date a Director's service on the Board terminates is before the end of the Restricted Period with respect to the award of shares of Common Stock, the Director shall forfeit and return to the Company all such Common Stock. The Common Stock shall be subject to the following restrictions, among others, during the Restricted Period: (a) The Common Stock shall be subject to forfeiture to the Company as described above. (b) The Common Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of and neither the right to receive Common Stock nor any interest under the Plan may be assigned by a Director. Amended: 6/16/86 6/05/89 6/03/96 subject to shareholder adoption of proposed amendments to the 1995 Directors Stock Option Plan -15- EX-11 3 EXHIBIT 11 - COMPUTATION OF EARNINGS PER SHARE EXHIBIT 11 - COMPUTATION OF EARNINGS PER SHARE (Thousands Except Per Share Amounts) Three Months Ended Nine Months Ended December 31 December 31 1996 1995 1996 1995 Primary Earnings Per Share Net income $ 7,041 $ 3,494 $10,532 $12,218 Preferred stock dividends 1 1 2 2 $ 7,040 $ 3,493 $10,530 $12,216 Shares outstanding Weighted average common shares 12,350 12,341 12,345 12,341 Net common shares issuable on exercise of stock options 160 75 66 41 Average common shares outstanding as adjusted 12,510 12,416 12,411 12,382 Primary earnings per share $.57 $.28 $.85 $.99 Fully Diluted Earnings Per Share Net income $ 7,041 $ 3,494 $10,532 $12,218 Shares outstanding Average common shares as adjusted for primary computation 12,510 12,416 12,411 12,382 Common shares issuable if the preferred stock was converted at the beginning of the year 4 5 4 5 Additional common shares issuable on exercise of stock options 16 22 16 Average common shares outstanding as adjusted 12,530 12,421 12,437 12,403 Fully diluted earnings per share $.56 $.28 $.84 $.99 -16- EX-27.1 4 EXHIBIT 27 - FINANCIAL DATA SCHEDULE QUARTER ENDED DECEMBER 31, 1996
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE STATEMENTS OF CONSOLIDATED FINANCIAL POSITION AND CONSOLIDATED OPERATIONS INCLUDED IN PART I OF THIS REPORT ON FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 1,000 MAR-31-1997 DEC-31-1996 9-MOS 49,636 39,815 56,402 0 56,398 245,063 82,705 47,065 344,549 56,689 6,304 0 0 6,285 232,165 344,549 230,070 0 164,378 0 0 0 1,092 27,232 10,300 16,932 (6,400) 0 0 10,532 .85 0
EX-27.2 5 EXHIBIT 27 - RESTATED FINANCIAL DATA SCHEDULE QUARTERS ENDED JUNE 30 AND SEPTEMBER 30, 1996
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE RESTATED STATEMENTS OF CONSOLIDATED FINANCIAL POSITION AND CONSOLIDATED OPERATIONS FOR THE QUARTERS ENDED JUNE 30 AND SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 1,000 MAR-31-1997 MAR-31-1997 JUN-30-1996 SEP-30-1996 3-MOS 6-MOS 6,596 11,938 24,143 30,340 97,084 60,046 0 0 67,580 58,093 281,950 238,978 102,551 86,947 61,521 49,336 389,479 341,195 106,673 58,781 6,606 6,403 0 0 0 0 6,285 6,285 225,833 232,142 389,479 341,195 82,557 164,073 0 0 59,598 118,487 0 0 0 0 0 0 317 651 10,411 19,145 3,890 7,090 6,521 12,055 (4,309) (8,564) 0 0 0 0 2,212 3,491 .18 .28 0 0
EX-27.3 6 EXHIBIT 27 - RESTATED FINANCIAL DATA SCHEDULE YEAR ENDED ENDED MARCH 31, 1996
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE RESTATED STATEMENTS OF CONSOLIDATED FINANCIAL POSITION AND CONSOLIDATED OPERATIONS FOR THE ENDED MARCH 31, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 1,000 MAR-31-1996 MAR-31-1996 MAR-31-1996 MAR-31-1996 JUN-30-1995 SEP-30-1995 DEC-31-1995 MAR-31-1996 3-MOS 6-MOS 9-MOS YEAR 11,282 5,348 13,507 16,195 41,941 44,333 16,225 13,836 115,420 108,819 105,204 96,360 0 0 0 2,647 88,960 96,638 108,133 69,753 300,188 296,483 283,821 286,994 146,157 149,859 152,282 102,295 89,630 91,345 92,468 60,241 417,395 417,051 411,467 394,647 141,547 138,227 130,506 113,158 9,089 9,002 8,400 6,711 0 0 0 0 0 0 0 0 6,285 6,285 6,285 6,285 216,754 219,858 222,314 224,670 417,395 417,051 411,467 394,647 60,156 130,343 206,742 284,683 0 0 0 0 41,320 91,775 149,177 205,305 0 0 0 0 0 0 0 0 0 0 0 0 343 669 962 1,146 8,118 15,463 22,583 33,805 3,190 5,970 8,660 12,278 4,928 9,493 13,923 21,527 (279) (769) (1,705) (4,857) 0 0 0 0 0 0 0 0 4,649 8,724 12,218 16,670 .38 .71 .99 1.35 0 0 0 0
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