-----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, OMdLHygQles3If/Ss4Y6jILJL1Gg0CLpYTnWoF/qMTamxLjdPSwffADTKHWkLVuE 0xEUzeVip7JtmLYIykZHCA== 0000950124-00-002856.txt : 20000510 0000950124-00-002856.hdr.sgml : 20000510 ACCESSION NUMBER: 0000950124-00-002856 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 12 CONFORMED PERIOD OF REPORT: 20000326 FILED AS OF DATE: 20000509 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BRIGGS & STRATTON CORP CENTRAL INDEX KEY: 0000014195 STANDARD INDUSTRIAL CLASSIFICATION: ENGINES & TURBINES [3510] IRS NUMBER: 390182330 STATE OF INCORPORATION: WI FISCAL YEAR END: 0627 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-01370 FILM NUMBER: 623266 BUSINESS ADDRESS: STREET 1: 12301 W WIRTH ST CITY: WAUWATOSA STATE: WI ZIP: 53222 BUSINESS PHONE: 4142595333 MAIL ADDRESS: STREET 1: P O BOX 702 CITY: MILWAUKEE STATE: WI ZIP: 53201 10-Q 1 QUARTERLY REPORT ENDED 3/26/00 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 26, 2000 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 1-1370 BRIGGS & STRATTON CORPORATION - ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Wisconsin 39-0182330 - ------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 12301 West Wirth Street, Wauwatosa, Wisconsin 53222 - ------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) 414/259-5333 - ------------------------------------------------------------------------------- (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ---- ---- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Outstanding at Class May 1, 2000 - ------------------------------------------------------------------------------- COMMON STOCK, par value $0.01 per share 22,301,079 Shares 1 2 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES INDEX
Page No. -------- PART I - FINANCIAL INFORMATION Item 1. Financial Statements: Consolidated Condensed Balance Sheets - March 26, 2000 and June 27, 1999 3 Consolidated Condensed Statements of Income - Three Months and Nine Months ended March 26, 2000 and March 28, 1999 5 Consolidated Condensed Statements of Cash Flow - Nine Months ended March 26, 2000 and March 28, 1999 6 Notes to Consolidated Condensed Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 Item 3. Quantitative and Qualitative Disclosures About Market Risk 11 PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K 11 Signatures 12
2 3 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS CONSOLIDATED CONDENSED BALANCE SHEETS (In thousands)
ASSETS ------ March 26, June 27, 2000 1999 ----------- ----------- (Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 13,805 $ 60,806 Accounts receivable, net 433,866 194,096 Inventories - Finished products and parts 164,841 72,196 Work in process 69,683 59,665 Raw materials 5,417 5,587 ----------- ----------- Total inventories 239,941 137,448 Future income tax benefits 41,289 34,383 Prepaid expenses 17,536 16,119 ----------- ----------- Total current assets 746,437 442,852 ----------- ----------- OTHER ASSETS: Marketable securities and other investments 48,207 19,024 Deferred income tax assets - 2,039 Capitalized software 6,820 7,516 ----------- ----------- Total other assets 55,027 28,579 ----------- ----------- PLANT AND EQUIPMENT: Cost 825,014 859,848 Less accumulated depreciation 432,198 455,394 ----------- ----------- Total plant and equipment, net 392,816 404,454 ----------- ----------- $ 1,194,280 $ 875,885 =========== ===========
The accompanying notes are an integral part of these statements. 3 4 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS (Continued) (In thousands)
LIABILITIES & SHAREHOLDERS' INVESTMENT -------------------------------------- March 26, June 27, 2000 1999 ----------- ----------- (Unaudited) CURRENT LIABILITIES: Accounts payable $ 134,957 $ 117,757 Domestic notes payable 216,469 4,335 Foreign loans 18,647 13,824 Current maturities of long-term debt 15,000 15,000 Accrued liabilities 143,287 119,685 Dividends payable 6,829 - Federal and state income taxes 21,429 11,901 ----------- ----------- Total current liabilities 556,618 282,502 ----------- ----------- OTHER LIABILITIES: Deferred revenue on sale of plant and equipment 15,711 15,798 Deferred income tax liability 2,565 - Accrued pension cost 8,640 17,306 Accrued employee benefits 13,892 13,185 Accrued postretirement health care obligation 65,706 67,877 Long-term debt 113,461 113,307 ----------- ----------- Total other liabilities 219,975 227,473 ----------- ----------- SHAREHOLDERS' INVESTMENT: Common stock- Authorized 60,000 shares, $.01 par value, Issued 28,927 shares 289 289 Additional paid-in capital 36,478 37,657 Retained earnings 701,027 612,807 Accumulated other comprehensive loss (633) (1,732) Unearned compensation on restricted stock (244) (235) Treasury stock at cost, 6,540 and 5,727 shares, respectively (319,230) (282,876) ----------- ----------- Total shareholders' investment 417,687 365,910 ----------- ----------- $ 1,194,280 $ 875,885 =========== ===========
The accompanying notes are an integral part of these statements. 4 5 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (In thousands except per share data) (Unaudited)
Three Months Ended Nine Months Ended --------------------- --------------------- Mar. 26 Mar. 28 Mar. 26 Mar. 28 2000 1999 2000 1999 --------- --------- --------- --------- NET SALES $ 468,678 $ 476,259 $1,189,849 $1,060,183 COST OF GOODS SOLD 366,838 373,428 932,904 848,269 --------- --------- ---------- ---------- Gross profit on sales 101,840 102,831 256,945 211,914 ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 33,285 32,140 96,121 90,495 --------- --------- ---------- ---------- Income from operations 68,555 70,691 160,824 121,419 INTEREST EXPENSE (6,816) (5,025) (15,151) (13,183) GAIN ON DISPOSITION OF FOUNDRY ASSETS - - 16,545 - OTHER INCOME, net 5,027 1,250 10,645 5,198 --------- --------- ---------- ---------- Income before provision for income taxes 66,766 66,916 172,863 113,434 PROVISION FOR INCOME TAXES 24,710 25,103 63,960 42,543 --------- --------- ---------- ---------- Net income $ 42,056 $ 41,813 $ 108,903 $ 70,891 ========= ========= ========== ========== EARNINGS PER SHARE DATA - Average shares outstanding 22,842 23,271 23,021 23,399 ====== ====== ====== ====== Basic earnings per share $ 1.84 $ 1.80 $ 4.73 $ 3.03 ====== ====== ====== ====== Diluted average shares outstanding 22,866 23,357 23,104 23,480 ====== ====== ====== ====== Diluted earnings per share $ 1.84 $ 1.79 $ 4.71 $ 3.02 ====== ====== ====== ====== CASH DIVIDENDS PER SHARE $ .30 $ .29 $ .90 $ .87 ====== ====== ====== ======
The accompanying notes are an integral part of these statements. 5 6 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW (In thousands) (Unaudited)
Nine Months Ended ---------------------------- CASH FLOWS FROM OPERATING ACTIVITIES: Mar. 26, 2000 Mar. 28, 1999 ------------- ------------- Net income $ 108,903 $ 70,891 Adjustments to reconcile net income to net cash used in operating activities - Depreciation and amortization 38,158 35,899 Equity in earnings of unconsolidated affiliates (8,209) (4,549) (Gain) loss on disposition of plant and equipment (16,271) 391 Credit for deferred income taxes (4,062) (278) Change in operating assets and liabilities - Increase in accounts receivable (239,750) (207,600) Increase in inventories (103,852) (20,048) Increase in prepaid expenses (1,928) (3,503) Increase in accounts payable and accrued liabilities 57,160 87,009 Other, net (9,400) (7,087) ----------- ----------- Net cash used in operating activities (179,251) (48,875) ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Additions to plant and equipment (53,861) (43,903) Proceeds received on disposition of plant and equipment 23,882 1,521 Other, net 5,141 1,205 ----------- ----------- Net cash used in investing activities (24,838) (41,177) ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings on loans and notes payable 216,957 81,417 Dividends (20,683) (20,380) Purchase of common stock for treasury (43,188) (58,006) Proceeds from exercise of stock options 5,561 28,682 ----------- ----------- Net cash provided by financing activities 158,647 31,713 ----------- ----------- EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS (1,559) (22) ----------- ----------- NET DECREASE IN CASH AND CASH EQUIVALENTS (47,001) (58,361) CASH AND CASH EQUIVALENTS, beginning 60,806 84,527 ----------- ----------- CASH AND CASH EQUIVALENTS, ending $ 13,805 $ 26,166 =========== =========== SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Interest paid $ 16,217 $ 14,751 =========== =========== Income taxes paid $ 58,657 $ 23,678 =========== ===========
The accompanying notes are an integral part of these statements. 6 7 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) The accompanying unaudited consolidated condensed financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and therefore do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with generally accepted accounting principles. However, in the opinion of the Company, adequate disclosures have been presented to make the information not misleading, and all adjustments necessary to present fair statements of the results of operations and financial position have been included. All of these adjustments are of a normal recurring nature. These condensed financial statements should be read in conjunction with the financial statements and the notes thereto which were included in the Company's latest Annual Report on Form 10-K. Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation. The caption entitled Marketable Securities and Other Investments represents equity securities of other entities that are held by the Company. Marketable Securities are classified as available-for-sale and are reported at fair market value with any changes in fair market value reported in Accumulated Other Comprehensive Loss. Other Investments represent investments in joint ventures and affiliates and are accounted for using the equity method of accounting. Financial Accounting Standard (FAS) No. 130, Reporting Comprehensive Income, requires the reporting of comprehensive income in addition to net income from operations. Comprehensive income is a more inclusive financial reporting method that includes disclosure of certain financial information that historically has not been recognized in the calculation of net income. Total comprehensive income is as follows (in thousands):
Three Months Ended Nine Months Ended ----------------------- --------------------- Mar. 26 Mar. 28 Mar. 26 Mar. 28 2000 1999 2000 1999 --------- -------- -------- ----------- Net income $ 42,056 $ 41,813 $108,903 $ 70,891 Unrealized gain on marketable securities 1,602 256 2,755 192 Foreign currency translation adjustments (1,024) (657) (1,656) 112 -------- -------- -------- -------- Total comprehensive income $ 42,634 $ 41,412 $110,002 $ 71,195 ======== ======== ======== ======== The components of Accumulated Other Comprehensive Loss are as follows (in thousands): Mar. 26 June 27 2000 1999 ---- ---- Unrealized gain on marketable securities $ 3,332 $ 577 Cumulative translation adjustments (3,965) (2,309) --------- --------- Accumulated other comprehensive loss $ (633) $ (1,732) ========= =========
At the end of August 1999, the Company contributed its two ductile iron foundries to Metal Technologies Holding Company, Inc. ("MTHC") in exchange for $23.6 million in cash and $45.0 million aggregate par value convertible preferred stock which was recorded at its estimated fair value of $21.6 million. The transaction resulted in a $16.5 million gain, and is shown as such on the income statement. The provisions of the preferred stock include a 15% cumulative dividend and conversion rights into a minimum of 31% of the common stock of MTHC. MTHC became the primary supplier to Briggs & Stratton Corporation of ductile iron castings for crankshafts and cam gears. 7 8 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is management's discussion and analysis of the Company's financial condition and results of operations for the periods included in the accompanying consolidated condensed financial statements: RESULTS OF OPERATIONS SALES Net sales for the third fiscal quarter totaled $469 million, a decrease of $8 million or 2% compared to the same period of the preceding year. The primary factors were a $16 million decrease of casting sales resulting from the disposition of the Company's ductile iron foundries in the first quarter of fiscal 2000 and $3 million from an unfavorable mix of engines sold. Offsetting these factors were an $8 million increase in sales dollars due primarily to a 4% increase in engine unit shipments and $5 million from increased prices. Net sales for the nine months ended March 2000 totaled $1,190 million, an increase of $130 million or 12% compared to the first nine months of the prior year. This increase resulted from the following factors: a $98 million increase in sales dollars resulting primarily from an 11% increase in engine unit shipments, a favorable mix change to higher-priced units of $53 million, and $10 million from increased prices. Offsetting these factors was a $32 million decrease in casting sales for the reason discussed above. GROSS PROFIT MARGIN The gross profit rate remained constant at 22% between the comparable quarters. Favorable factors to the gross profit were $5 million of price increases, lower expenses of $6 million, and $3 million attributed to the benefit of higher production in the third fiscal quarter of 2000. Offsetting these improvements were $10 million of higher costs for purchased items attributable to higher aluminum costs and higher costs for imported engines due to currency exchange rates, and a $3 million mix shift to lower margin engines. The gross profit rate for the nine-month period increased to 22% in the current year from 20% in the preceding year. This resulted in additional gross profit totaling $19 million between years. This increase resulted primarily from the same factors discussed above for the quarter. Favorable factors were $10 million of increased prices and $18 million attributed to spreading of costs over more units produced. These were offset by $7 million of higher costs for purchased items. ENGINEERING, SELLING, GENERAL AND ADMINISTRATIVE EXPENSES This category increased $1 million or 4% between the third fiscal quarters of 2000 and 1999, primarily from $1 million of higher salary costs due to the planned increases in manpower. Engineering, selling and general and administrative expenses increased $6 million or 6% for the comparative nine-month periods. This increase was primarily from the following: $2 million increase in salaries resulting from increased manpower, a $4 million increase in profit sharing expenses due to improved results, and a $1 million increase in engineering costs related to the development and testing of new products. These increases were offset by a $2 million decrease in costs related to the Company's POWERCOM software business that was sold in the first quarter of the preceding year. 8 9 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES INTEREST EXPENSE Interest expense increased $2 million or 36% in the three-month comparison and increased $2 million or 15% in the nine-month comparison. These increases were the result of the Company's higher level of short-term borrowings during the third quarter and the latter part of the second quarter of fiscal 2000 to fund working capital needs. GAIN ON DISPOSITION OF FOUNDRY ASSETS At the end of August 1999, the Company contributed its two ductile iron foundries to Metal Technologies Holding Company, Inc. ("MTHC") in exchange for $23.6 million in cash and $45.0 million aggregate par value convertible preferred stock which was recorded at its estimated fair value of $21.6 million. The transaction resulted in a $16.5 million gain, and is shown as such on the income statement. The provisions of the preferred stock include a 15% cumulative dividend and conversion rights into a minimum of 31% of the common stock of MTHC. MTHC became the primary supplier to Briggs & Stratton Corporation of ductile iron castings for crankshafts and cam gears. PROVISION FOR INCOME TAXES The effective tax rate used in both the three-month and nine-month periods for the current year was 37.0%. This is management's estimate of what the rate will be for the entire 2000 fiscal year. Last year's rate was 37.5% in both periods. LIQUIDITY AND CAPITAL RESOURCES Net cash used in operating activities for the nine-month periods of fiscal 2000 and fiscal 1999 were $179 million and $49 million, respectively. The significant increase between years was due to the following: The fiscal 2000 cash flow from operating activities reflects improved net income, excluding depreciation and gain on disposition of plant and equipment, of $24 million. Offsetting this improvement is an increased requirement for working capital of $144 million, caused primarily by three factors. First is a $84 million increase in inventories caused by a planned increase in finished engines to meet future demand. Second is a $32 million increase in accounts receivable attributed to the timing of customer payments. Last are lower increases in accounts payable and accrued liabilities of $30 million caused by timing of payments. Net cash used in investing activities totaled $25 million and $41 million, respectively. The $16 million decrease is attributed primarily to $23 million of cash received from the foundry transaction and dividends from equity investments of $4 million, offset by a $10 million increase in capital expenditures related to capacity increases and new products. Net cash provided by financing activities amounted to $159 million and $32 million in fiscal 2000 and 1999, respectively. These financing activities reflect higher levels of short-term borrowings in fiscal 2000 to fund working capital requirements, causing a $136 million increase in debt between the periods. Also, the Company did not repurchase as many shares of its common stock in the open market during fiscal 2000. 9 10 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES FUTURE LIQUIDITY AND CAPITAL RESOURCES The share repurchase program authorized by the Board of Directors in fiscal 1999 for 1.3 million shares was completed in the third quarter of fiscal 2000. In March 2000, the Board of Directors approved a repurchase of up to 1.0 million additional shares of the Company's common stock in open market or private transactions. Stock repurchases under the most recent authorization totaling .4 million shares were made in open market transactions as of the end of March 2000. Future purchases will be funded from available cash. The Company expects that working capital requirements through the end of fiscal 2000 will continue to reflect higher inventories and should also reflect a decrease in accounts receivable in line with seasonal cash collection. Management expects cash flows for capital expenditures to total $80 million in fiscal 2000 and to be funded from available cash. These anticipated expenditures include a significant amount for capacity increases, as well as continuing reinvestment in equipment and new products. The Company currently intends to increase future cash dividends per share at a rate approximating the inflation rate, subject to the discretion of its Board of Directors and requirements of applicable law. OUTLOOK The lawn and garden equipment selling season got off to a strong start, and at this time the strength continues. However, the Company expects demand to weaken late in the fourth quarter, which is the normal pattern. Even if engine demand weakens, the Company plans to continue high production rates because of the need to maintain finished engine inventory at a level that will allow the Company to meet next year's demand. Thus the Company believes that the fourth quarter will be a good one, although not as good as last year's unusually strong fourth quarter. At this time, the Company expects record sales, with unit sales increasing 5% to 7%, and record earnings for the full fiscal year. OTHER MATTERS YEAR 2000 The Company has not experienced any significant year 2000 issues to date. The Company continues to monitor its Year 2000 Program for unexpected issues that could possibly still develop. The year 2000 problem has many aspects and potential consequences, some of which are not reasonably foreseeable, and there can be no assurance that unforeseen consequences will not arise. CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS Certain statements in Management's Discussion and Analysis of Financial Condition and Results of Operations may contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. The words "anticipate", "believe", "estimate", "expect", "objective", and "think" or similar expressions are intended to identify forward-looking statements. The forward-looking statements are based on the Company's current views and assumptions and involve risks and uncertainties that include, among other things, the effects of weather on the purchasing patterns of the Company's customers and end use purchasers of the Company's engines; the seasonal nature of the Company's business; actions of competitors; changes in laws and regulations, including accounting standards; employee relations; customer demand; prices of purchased raw materials and parts; domestic economic conditions, including housing starts and changes in consumer disposable income; foreign economic conditions, including currency rate fluctuations; and unanticipated year 2000 issues. Some or all of the factors may be beyond the Company's control. 10 11 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK There have been no material changes since the September 7, 1999 filing of the Company's Annual Report on Form 10-K. PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits. Exhibit Number Description ------ ----------- 10.0 Executive Supplemental Retirement Plan* 10.1 Agreement with Executive Officer* 11 Computation of Earnings Per Share of Common Stock* 12 Computation of Ratio of Earnings to Fixed Charges* 27(a) Financial Data Schedule, March 26, 2000* 27(b) Restated Financial Data Schedule, June 27, 1999* 27(c) Restated Financial Data Schedule, March 28, 1999* 27(d) Restated Financial Data Schedule, December 27, 1998* 27(e) Restated Financial Data Schedule, September 27, 1998* 27(f) Restated Financial Data Schedule, June 28, 1998* 27(g) Restated Financial Data Schedule, June 29, 1997* *Filed herewith (b) Reports on Form 8-K. There were no reports on Form 8-K for the third quarter ended March 26, 2000. 11 12 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES 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. BRIGGS & STRATTON CORPORATION ----------------------------- (Registrant) Date: May 5, 2000 /s/ James E. Brenn ------------------------------------------------- James E. Brenn Senior Vice President and Chief Financial Officer Date: May 5, 2000 /s/ Todd J. Teske ------------------------------------------------- Todd J. Teske Controller 12 13 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES EXHIBIT INDEX Exhibit Number Description ------ ----------- 10.0 Executive Supplemental Retirement Plan* 10.1 Agreement with Executive Officer* 11 Computation of Earnings Per Share of Common Stock* 12 Computation of Ratio of Earnings to Fixed Charges* 27(a) Financial Data Schedule, March 26, 2000* 27(b) Restated Financial Data Schedule, June 27, 1999* 27(c) Restated Financial Data Schedule, March 28, 1999* 27(d) Restated Financial Data Schedule, December 27, 1998* 27(e) Restated Financial Data Schedule, September 27, 1998* 27(f) Restated Financial Data Schedule, June 28, 1998* 27(g) Restated Financial Data Schedule, June 29, 1997* * Filed herewith 13 EX-10.0 2 EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN 1 BRIGGS & STRATTON CORPORATION Form 10-Q for Quarterly Period Ended March 26, 2000 Exhibit No. 10.0 BRIGGS & STRATTON CORPORATION EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN AS AMENDED AND RESTATED ON January 19, 2000 2 BRIGGS & STRATTON CORPORATION EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN Amended and Restated Effective as of January 1, 2000 3 TABLE OF CONTENTS Page ---- PREAMBLE 1 ARTICLE I General 2 1.1 Committee 2 1.2 Deferred Compensation Plan 2 1.3 Employer 2 1.4 Plan 2 1.5 Pension Plan 2 ARTICLE II Eligibility 3 2.1 Persons Eligible As Participants Under The Plan 3 ARTICLE III Retirement Benefits 4 3.1 Time of Commencement and Amount 4 3.2 Manner of Payment 5 3.3 Pre-retirement Spousal Survivor Annuity 5 3.4 Pre-retirement Death Benefit 6 3.5 Interpretation 7 3.6 Commutation of Benefit 7 3.7 Committee Discretion 8 ARTICLE IV Amendment and Termination 9 4.1 Amendment and Termination 9 4.2 Acceleration 9 ARTICLE V Administration 10 5.1 In General 10 5.2 Committee Discretion 10 5.3 Committee Members' Conflict of Interest 10 5.4 Governing Law 10 5.5 Expenses 11 5.6 Minor or Incompetent Payees 11 5.7 Withholding 11 5.8 Indemnification 11 i 4 ARTICLE VI Benefits Unfunded 12 6.1 Unsecured Claim 12 6.2 Grantor Trust Only 12 ARTICLE VII Nonalienation of Benefits 13 ARTICLE VIII Claims Procedure 14 8.1 Claims 14 8.2 Review Procedure 14 ARTICLE IX Miscellaneous 15 9.1 No Right to Continued Employment 15 9.2 Impact on Other Plans 15 9.3 Severability 15 9.4 Gender and Number 15 9.5 Evidence Conclusive 15 9.6 Status of Plan Under ERISA 15 9.7 Name and Address Changes 16 9.8 Limitations on Provisions 16 9.9 Identity of Payee 16 ii 5 PREAMBLE Briggs & Stratton Corporation hereby amends and restates, effective as of January 1, 2000, the executive supplemental retirement plan it previously adopted via Board resolutions dated August 15, 1989 and amended by resolutions dated October 15, 1996. 1 6 ARTICLE I General 1.1 Committee. The term "Committee" means the Nominating, Compensation and Governance Committee of the Board of Directors of the Employer. Such Committee shall be the Plan Administrator of this Plan for purposes of the Employee Retirement Income Security Act of 1974. 1.2 Deferred Compensation Plan. The term "Deferred Compensation Plan" means the Briggs & Stratton Corporation Key Employees Savings and Investment Plan and any and all other deferred compensation agreements between the Participant and the Employer. 1.3 Employer. The term "Employer" means Briggs & Stratton Corporation. 1.4 Plan. The term "Plan" means the Briggs & Stratton Corporation Executive Supplemental Retirement Plan as set forth in this document and all subsequent amendments hereto. 1.5 Pension Plan. The term "Pension Plan" means the Briggs & Stratton Retirement Plan as amended from time to time. 1.6 Service. The term "Service" has the same meaning as defined in Section 3.2 of the Pension Plan. 2 7 ARTICLE II Eligibility 2.1 Persons Eligible As Participants Under The Plan. Each corporate officer who is a Participant in the Pension Plan shall be a Participant in this Plan. The Plan does not cover any person who terminated employment with the Employer prior to August 15, 1989. 3 8 ARTICLE III Retirement Benefits 3.1 Time of Commencement and Amount. (a) Normal or Late Retirement. In the case of a Participant who terminates employment with the Employer on or after his 65th birthday, his pension benefit hereunder shall commence on the first day of the month next following the date of his termination of employment. (b) Early Retirement. In the case of a Participant who terminates employment with the Employer prior to his 65th birthday but on or after his 55th birthday and after completing at least 10 but less than 30 years of Service, his pension benefit hereunder shall commence on either (i) the first day of the month following the later of (A) the date of his termination of employment or (B) his 62nd birthday or, if earlier, the date he would have completed 30 years of Service or (ii) if consented to by the Committee in its discretion, the first day of any month following the date of his termination of employment. (c) Special Early Retirement. In the case of a Participant who terminates employment with the Employer prior to his 65th birthday but after completing 30 years of Service, his pension benefit hereunder shall commence on the first day of the month following his termination of employment. (d) Disability Retirement. In the case of a Participant who terminates employment with the Employer prior to his 65th birthday but on or after incurring a Disability as defined in Section 2.3(1) of the Pension Plan and after completing 10 years of Service, his pension benefit hereunder shall commence on the first day of the month following the date of his termination of employment. (e) In the case of Normal, Late, Early, Special Early and Disability Retirement, the amount of monthly pension payable as a single life pension shall be (i) the amount of monthly pension which would have been payable to him under the Pension Plan as a single life monthly pension based on his retirement on the same date and commencement of his benefits on the same date if the provisions of Internal Revenue Code Sections 401(a)(17) and 415 did not exist, if he had made no deferrals under the Deferred Compensation Plan and if the benefit formula under the Pension Plan contained a multiplier of 2.1% (rather than 1.6%) minus (ii) the amount of pension, expressed as a single life monthly pension, actually payable to him under the Pension Plan based on his retirement on the same date and assuming benefits commence on the same date. (f) Termination of Employment. (l) In the case of a Participant who terminates employment with the Employer prior to his 65th birthday and prior to completing 10 years of Service, his pension benefit hereunder shall commence on the first day of the month next following the date he attains age 65. 4 9 (2) In the case of a Participant who terminates employment with the Employer prior to his 55th birthday after completing at least 10 but less than 30 years of Service, his pension benefit hereunder shall commence (i) on the first day of the month next following the date he attains age 65 or (ii) if consented to by the Committee in its discretion, the first day of any month next following his 55th birthday and prior to his 65th birthday requested by the Participant. (3) If benefits become payable under paragraphs (f)(l) or (f)(2), the amount of such monthly pension payable as a single life pension shall be (i) the amount of monthly pension which would have been payable to him under the Pension Plan as a single life monthly pension based on his termination on the same date and assuming commencement of benefits on the same date if the provisions of Internal Revenue Code Sections 401 (a)(17) and 415 did not exist, if he had made no deferrals under the Deferred Compensation Plan, if the benefit formula under the Pension Plan contained a multiplier of 2.1% (rather than 1.6%) and if the Pension Plan did not require completion of 5 years of Service to be eligible for a benefit minus (ii) the amount of pension, expressed as a single life monthly pension, actually payable to him under the Pension Plan based on his termination on the same date and assuming benefits under the Pension Plan commence on the same date (or, in the case of a Participant with less than 5 years of Service, the amount which would have been payable under the Pension Plan if it had not required completion of 5 years of Service by the Participant in order for a pension to be payable). 3.2 Manner of Payment. If the Participant is unmarried at the time his pension benefit commences, his pension benefit shall be payable to him in the form of a single life monthly pension. If the Participant is married at the time his pension benefit commences, instead of receiving a single life monthly pension he shall receive a Joint and Survivor Pension. The Joint and Survivor Pension shall be a reduced monthly pension payable to the Participant for his life with a continuing pension payable after his death to his surviving spouse for her life in an amount equal to 50% of the reduced benefit payable during the life of the Participant. Such Joint and Survivor Pension shall be the actuarial equivalent of the single life monthly pension which would be payable to the Participant if he were unmarried. If so requested by the Participant and consented to by the Committee in its discretion, the Plan shall pay the benefit of a Participant for which the Participant is eligible in the form of a single life monthly pension or in one of the optional forms of benefit payable under Section 3.04 of the Pension Plan which is the actuarial equivalent of the single life monthly pension otherwise payable to the Participant hereunder. Actuarially equivalent benefits shall be determined under the factors set forth for determining actuarial equivalency in the Pension Plan. 3.3 Pre-retirement Spousal Survivor Annuity. (a) If any married Participant (including a terminated Participant) who has not met the age and service requirements to begin receiving a pension under Section 3.1(a), (b) or (c) dies before starting to receive payments hereunder, then his surviving spouse, if any, shall be entitled to a monthly benefit for life. (b) Provided that the surviving spouse survives to such commencement date, payment of such benefit will commence on (i) the first day of the month following the Participant's 5 10 or former Participant's date of death or, if later, 55th birthday or (ii) in the case of a Participant or former Participant who had not completed at least 10 years of Service, the first day of the month following the 65th birthday of the Participant or former Participant. (c) The amount of such monthly benefit for life shall be an amount equal to (i) what such spouse would have received as a survivor annuity under the Pension Plan, based on the Participant's Service and the benefit formula in effect under the Pension Plan on the date of his death or, if earlier, the date of his termination of employment, if the Participant had survived to and commenced to receive his pension on the later of his 55th birthday (65th birthday if the Participant had not completed at least 10 years of Service) or date of death in the Joint and Survivor Pension form, as described in Section 3.2, and died on the next day if the provisions of Internal Revenue Code Sections 401(a)(17) and 415 did not exist, if the Participant had made no deferrals under the Deferred Compensation Plan, if the benefit formula under the Pension Plan contained a multiplier of 2.1% (rather than 1.6%) and if the Pension Plan did not require completion of 5 years of Service for this benefit to apply minus (ii) the amount of any survivor annuity actually payable to the spouse under the Pension Plan based on the Participant's death on the same date and assuming the survivor annuity commenced on the same date (or, in the case of a Participant with less than 5 years of Service, the amount which would have been payable under the Pension Plan if it had not required completion of 5 years of Service by the Participant in order for the survivor annuity to be payable). (d) In addition to the payments otherwise due under paragraphs (a), (b) and (c), if the Participant had completed at least 10 years of Service and dies prior to what would have been the Participant's 55th birthday, then until the Participant's 55th birthday the Participant's spouse shall be entitled to receive a monthly amount of benefit which shall be computed as described under paragraph (c) above as though the Participant's 55th birthday coincided with the date of the Participant's death and the offset described in clause (ii) of paragraph (c) above did not exist. Then, however, once the 55th anniversary of the date of the Participant's birth occurs, benefits which would otherwise have commenced under paragraphs (a), (b) and (c) above shall not commence until the total dollar amount of omitted benefits equals the total dollar amount of benefits paid under this paragraph (d) until the Participant's 55th birthday. On the first of the month following the date the full amount of pre-age 55 payments have been recouped by withholding after age 55, payments shall commence under this Plan to the spouse in the same monthly amount as would have been payable to the spouse under paragraph (c) above from that day forward had benefits only commenced to the spouse on the 55th anniversary of the Participant's date of birth. 3.4 Pre-retirement Death Benefit. (a) If any Participant (including any former Participant) who has met the age and service requirements for a pension under Section 3.1(a), (b) or (c) dies before starting to receive payments hereunder, then his surviving beneficiary, if any, shall be entitled to a survivor benefit. (b) Payment of such benefit will commence on the first day of the month following the Participant's or former Participant's date of death. 6 11 (c) The amount of such survivor benefit shall be an amount equal to (i) what such beneficiary would have received as a survivor benefit under the Pension Plan if the Participant had terminated employment on the day before his death and commenced to receive benefits on that day under whichever of Section 3.1(a), (b) or (c) would have been applicable calculated on the assumption that the provisions of Internal Revenue Code Sections 401 (a)(17) and 415 did not exist, the Participant had made no deferrals under the Deferred Compensation Plan and the benefit formula under the Pension Plan contained a multiplier of 2.1% (rather than 1.6%) minus (ii) the amount of survivor benefit actually payable to the beneficiary under the Pension Plan based on the Participant's death on the same date and assuming the survivor benefit commenced on the same date. (d) The beneficiary shall be the same beneficiary as designated by the Participant for purposes of Section 6.3 of the Pension Plan (or, in the case of death after termination of employment, the beneficiary in effect under Section 6.4 of the Pension Plan) and the form of payment shall be the same form as in effect under Section 6.3 of the Pension Plan (or, in the case of death after termination of employment, the same form as in effect under Section 6.4 of the Pension Plan). 3.5 Interpretation. (a) With the exception of the fact that this Plan pays a benefit to an individual who terminates employment or dies prior to completion of 5 years of Service, it is the intention of the Employer that the benefits provided to the Participant and any beneficiary under this Plan and the Pension Plan together shall be no greater than would have been provided to the Participant and any beneficiary under the terms of the Pension Plan if the Participant had at all times been covered under the Pension Plan in accordance with its rules had the limitations of Internal Revenue Code Sections 415 and 401(a)(17) not existed and if the Participant had made no deferrals under the Deferred Compensation Plan (and if the formula in effect under the Pension Plan contained a multiplier of 2.1% rather than 1.6%). In the event that an individual's pension is increased under the Pension Plan after such individual commences to receive benefits hereunder, such increase shall be taken into account and shall reduce the remaining payments due the individual hereunder or, if the individual has received payment from this Plan in a lump sum, such individual shall be obligated to make monthly payments to the Employer equal to the monthly amounts by which the individual's payments from the Pension Plan have increased. (b) In computing the benefits which would be payable under this Plan in the absence of the offset for benefits payable under the Pension Plan, Exhibit A of the Pension Plan and the last sentence of the first paragraph in Section 2.3 of the Pension Plan shall be ignored. However, in computing the amount of offset for amounts payable under the Pension Plan all amounts payable under the Pension Plan shall be taken into account including amounts payable under the Pension Plan as a result of Exhibit A of the Pension Plan and the last sentence of the first paragraph of Section 2.3 of the Pension Plan. 3.6 Commutation of Benefit. The Committee, in its discretion, may determine to commute the benefits otherwise payable to a Participant or beneficiary hereunder, i.e., the Committee may direct that in lieu of the benefit otherwise payable to a Participant or a beneficiary 7 12 hereunder, the Plan shall pay such individual a single lump sum cash payment which is the actuarial equivalent of the benefit otherwise payable. Actuarial equivalency shall be determined under the factors set forth in the Pension Plan. 3.7 Committee Discretion. As to the exercise of its discretion under this Plan, the Committee shall in no way be bound by past precedent in connection with other Participants, i.e., the fact that it may have directed an earlier payment commencement date or an alternative form of payment for one Participant shall not in any way obligate the Committee to reach a similar decision for any subsequent Participant. Any Committee member who is also a Participant in this Plan shall not be authorized to vote or otherwise participate in the decision regarding the time or form of payment of that individual's benefit. 8 13 ARTICLE IV Amendment and Termination 4.1 Amendment and Termination. Briggs & Stratton Corporation may amend or terminate this Plan at any time through action of its Board of Directors. If the Plan is terminated no further benefits shall accrue hereunder. However, unless necessary to conform to any present or future federal or state law or regulation, amendment or termination may not result in a reduction of benefits of a Participant (or his surviving spouse) who is already receiving benefits, nor may amendment or termination result in a Participant who is still in active service (or his surviving spouse) receiving a benefit hereunder smaller than that to which he would have been entitled had the Participant terminated employment on the day prior to the effective date of such amendment or termination. The delegation of authority to the Committee in Section 1.1 and Article V does not extend to this Section 4.1. 4.2 Acceleration. The Committee may direct payment of a Participant's benefits in an actuarially equivalent lump sum before they otherwise would be payable hereunder at any time after the Plan is terminated or if, based on notification from the Internal Revenue Service or a review by the Committee in light of Internal Revenue Service guidance, the Committee determines that a Participant has or will recognize income for federal income tax purposes with respect to amounts that are or will be payable under the Plan before they are to be paid. Further, the Committee may direct payment of a Participant's benefits in an actuarially equivalent lump sum before they otherwise would be payable and may terminate a Participant's participation in the Plan if, based on notification from the Department of Labor or a review by the Committee in light of Department of Labor guidance, the Committee determines that an individual's participation in the Plan jeopardizes the Plan's status as a plan described in Section 9.6 hereof. 9 14 ARTICLE V Administration 5.1 In General. The Committee has such powers as may be necessary to direct the general administration of the Plan, including the powers given to it elsewhere in this document and including (but not by way of limitation) the following powers: (a) to construe and interpret the Plan and to make equitable adjustments for any mistakes or errors made in the administration thereof; (b) to prescribe such procedures, rules and regulations as it shall deem necessary or proper for the efficient administration of the Plan or any of its duties hereunder; (c) to decide questions of eligibility and determine the amount, manner and time of payment of any benefits and to direct the payment of the same by the Employer; (d) to prescribe the form and manner of application for any benefits hereunder and forms to be used in the general administration hereof; and (e) to receive from the Employer and Participants or their beneficiaries such information as shall be necessary for the proper administration of the Plan. 5.2 Committee Discretion. The Committee has full and complete discretionary authority to determine eligibility for benefits, to construe the terms of the Plan and to decide any matter presented through the claims review procedure. Any final determination by the Committee shall be binding on all parties and afforded the maximum deference allowed by law. If challenged in court, such determination shall not be subject to de novo review and shall not be overturned unless proven to be arbitrary and capricious upon the evidence considered by the Committee at the time of such determination. 5.3 Committee Members' Conflict of Interest. A member of the Committee who is covered hereunder may not vote or decide upon any matter relating solely to himself or vote in any case in which his individual right to any benefit under the Plan is particularly involved nor may a member of the Board who is covered hereunder vote to amend the Plan regarding the timing of distributions or vote with respect to direct or indirect termination of the Plan. Decisions shall be made by remaining Committee or Board members even if there is no quorum under normal Committee or Board rules. 5.4 Governing Law. This Plan shall be construed in accordance with the laws of the State of Wisconsin to the extent not preempted by the provisions of the Employee Retirement Income Security Act of 1974 or other federal law. 10 15 5.5 Expenses. All expenses and costs incurred in connection with the administration and operation of the Plan shall be borne by the Employer and/or the Trust. 5.6 Minor or Incompetent Payees. If a person to whom a benefit is payable is a minor or is otherwise incompetent by reason of a physical or mental disability, the Committee may cause the payments due to such person to be made to another person for the first person's benefit without any responsibility to see to the application of such payment. Such payments shall operate as a complete discharge of the obligations to such person under the Plan. 5.7 Withholding. To the extent required by law, the Employer shall withhold any taxes required to be withheld by the federal or any state or local government from payments made hereunder or from other amounts paid to the Participant by the Employer. To the extent that FICA taxes are required to be withheld from the Participant with respect to amounts credited under this Plan and no amounts are to be paid to the Participant hereunder or otherwise from the Employer from which such FICA taxes may be withheld, then the Employer shall pay such FICA taxes and the Participant's benefit hereunder shall be reduced by the amount of the FICA tax paid. 5.8 Indemnification. Except as otherwise provided by law, neither the Board or the Committee nor any individual member of the Board or the Committee, nor the Employer, nor any officer, shareholder or employee of the Employer shall be liable for any error of judgment, action or failure to act hereunder or for any good faith exercise of discretion, excepting only liability for gross negligence or willful misconduct. Such individuals and entities shall be indemnified and held harmless by the Employer against any and all claims, damages, liabilities, costs and expenses (including attorneys' fees) arising by reason of any good faith error of omission or commission with respect to any responsibility, duty or action hereunder. Nothing herein contained shall preclude the Employer from purchasing insurance to cover potential liability of one or more persons who serve in an administrative capacity with respect to the Plan. 11 16 ARTICLE VI Benefits Unfunded 6.1 Unsecured Claim. The right of any individual to receive payment under the provisions of this Plan shall be an unsecured claim against the general assets of the Employer, and no provisions contained in this Plan, nor any action taken pursuant to this Plan, shall be construed to give any individual at any time a security interest in any asset of the Employer, of any affiliated company, or of the stockholders of the Employer. The liabilities of the Employer to any individual pursuant to this Plan shall be those of a debtor pursuant to such contractual obligations as are created by this Plan and to the extent any person acquires a right to receive payment from the Employer under this Plan, such right shall be no greater than the right of any unsecured general creditor of the Employer. 6.2 Grantor Trust Only. Benefits under this Plan are payable solely from the general assets of the Employer. The rights of Participants and beneficiaries hereunder shall not constitute or be treated as a trust fund of any kind. Title to and beneficial ownership of any assets which the Employer may earmark to pay deferred compensation hereunder shall at all times remain in the Employer and Participants and beneficiaries hereunder shall have no interest in any specific assets of the Employer by virtue of this Plan. Notwithstanding the foregoing, the Employer intends to finance its obligation hereunder via the Trust Agreement dated January 31, 1995 between the Employer and Johnson Heritage Trust Company (the "Trust"), which is intended to be a grantor trust, in the event of a Change of Control Event as defined in such Trust. It is the intention of all parties involved that the arrangements be unfunded for tax purposes and for purposes of Title I of ERISA. The Trust and any assets held by the Trust to assist it in meeting its obligations under the Plan are intended to conform to the terms of the model trust requirements set forth in Revenue Procedure 92-64 issued by the Internal Revenue Service. 12 17 ARTICLE VII Nonalienation of Benefits All benefits payable hereunder are for the sole use and benefit of the Participants and their beneficiaries and, to the extent permitted by law, shall be free, clear and discharged of and from, and are not to be in any way liable for, debts, contracts or agreements, now contracted or which may hereafter be contracted and from all claims and liabilities now or hereafter incurred by any Participant or beneficiary covered by this Plan. No Participant or beneficiary covered by this Plan shall have the right to anticipate, surrender, encumber, alienate or assign, whether voluntarily or involuntarily, any of the benefits to become due hereunder unto any person or persons upon any terms whatsoever, and any attempt to do so shall be void. 13 18 ARTICLE VIII Claims Procedure 8.1 Claims. If the Participant or the Participant's beneficiary (hereinafter referred to as "claimant") believes he is being denied any benefit to which he is entitled under this Plan for any reason, he may file a written claim with the member of the Committee designated as the claims administrator. The claims administrator shall review the claim and notify the claimant of his decision within 90 days of receipt of such claim, unless the claimant receives written notice prior to the end of the 90 day period stating that special circumstances require an extension of the time for decision. The claim administrator's decision shall be in writing, sent by first class mail to the claimant's last known address, and if a denial of the claim, shall contain the specific reasons for the denial, reference to pertinent provisions of the Plan on which the denial is based, a description of any additional information or material necessary to perfect the claim, and an explanation of the claims review procedure. 8.2 Review Procedure. A claimant is entitled to request the entire Committee to review any denial by written request to the Committee within 60 days of receipt of the denial. Absent a request for review within the 60-day period, the claim will be deemed to be conclusively denied. The Committee shall afford the claimant or his authorized representative the opportunity to review all pertinent documents and submit issues and comments in writing and shall render a review decision in writing, all within 60 days after receipt of a request for review (provided that in special circumstances the Committee may extend the time for decision by not more than 60 days upon written notice to the claimant). The Committee's review decision shall contain specific reasons for the decision and reference to the pertinent provisions of the Plan. 14 19 ARTICLE IX Miscellaneous 9.1 No Right to Continued Employment. Neither participation in this Plan, nor the payment of any benefit hereunder, shall be construed as giving to the Participant any right to be retained in the service of the Employer, or limiting in any way the right of the Employer to terminate the Participant's employment at any time. Nor does the participation in this Plan guarantee the Participant the right to receive any specific amount of compensation or bonus, such amount being determined solely under such applicable compensation or bonus arrangement as established by the Employer. 9.2 Impact on Other Plans. No amounts credited to any Participant under this Plan and no amounts paid from this Plan will be taken into account as "wages", "salary", "base pay" or any other type of compensation when determining the amount of any payment or allocation, or for any other purpose, under any other qualified or nonqualified pension or profit sharing plan of the Employer or other plan or program of the Employer, except as otherwise may be specifically provided by such plan or program. 9.3 Severability. If any provisions of the Plan shall be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts of the Plan, but this Plan shall be construed and enforced as if said illegal and invalid provisions had never been included herein. 9.4 Gender and Number. Masculine gender shall include the feminine, and the singular shall include the plural, unless the context clearly indicates otherwise. 9.5 Evidence Conclusive. The Employer, the Committee and any person or persons involved in the administration of the Plan shall be entitled to rely upon any certification, statement, or representation made or evidence furnished by any person with respect to any facts required to be determined under any of the provisions of the Plan, and shall not be liable on account of the payment of any monies or the doing of any act or failure to act in reliance thereon. Any such certification, statement, representation, or evidence, upon being duly made or furnished, shall be conclusively binding upon the person furnishing it but not upon the Employer, the Committee or any other person involved in the administration of the Plan. Nothing herein contained shall be construed to prevent any such parties from contesting any such certification, statement, representation, or evidence or to relieve any person from the duty of submitting satisfactory proof of any fact. 9.6 Status of Plan Under ERISA. The Plan is intended to be an unfunded plan maintained by an Employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees, as described in Section 201(2), Section 301(a)(3), Section 401(a)(1) and Section 402 1(b)(6) of the Employee Retirement Income Security Act of 1974, as amended. 15 20 9.7 Name and Address Changes. Each Participant shall keep his name and address on file with the Employer and shall promptly notify the Employer of any changes in his name or address. All notices required or contemplated by this Plan shall be deemed to have been given to a Participant if mailed with adequate postage prepaid thereon addressed to him at his last address on file with the Employer. If any check in payment of a benefit hereunder (which was mailed to the last address of the payee as shown on the Employer's records) is returned unclaimed, further payments shall be discontinued unless evidence is furnished that the recipient is still alive. 9.8 Limitations on Provisions. The provisions of the Plan and any benefits payable hereunder shall be limited as described herein. Any benefit payable under the Pension Plan shall be paid solely in accordance with the terms and provisions of the Pension Plan, and nothing in the Plan shall operate or be construed in any way to modify, amend, or affect the terms and provisions of the Pension Plan. 9.9 Identity of Payee. If at any time any doubt exists as to the identity of any person entitled to payment of any benefit hereunder or as to the amount or time of any such payment, such sum shall be held by the Employer until such doubt is cured or the Employer may pay such sum into a court of competent jurisdiction in accordance with any lawful procedure in such case made and provided. 16 EX-10.1 3 AGREEMENT WITH EXECUTIVE OFFICER 1 BRIGGS & STRATTON CORPORATION Form 10-Q for Quarterly Period Ended March 26, 2000 Exhibit No. 10.1 AGREEMENT WITH EXECUTIVE OFFICER 2 AGREEMENT This Release and Settlement Agreement ("Agreement"), dated as of the date hereof, is made between Briggs & Stratton Corporation (the "Employer"), a Wisconsin corporation, with offices at 12301 West Wirth Street, Wauwatosa, Wisconsin 53222, and Gerald E. Zitzer (the "Employee"). WHEREAS, pursuant to the sale of the Company's castings operations, the Employee will terminate his services with the Employer as of June 30, 2000 ("the Effective Date"). WHEREAS, the Employee and Employer are parties to an Employment Agreement, dated January 30, 1998, and a Change in Control Employment Agreement, dated February 19, 1990; WHEREAS, the Employee is a participant in Briggs & Stratton Corporation's Stock Incentive Plan and the Briggs & Stratton Corporation Economic Value Added Incentive Compensation Plan, as well as various employee welfare benefit plans sponsored by Briggs & Stratton; WHEREAS, as of the Effective Date, the Employee will become an officer and participant in various benefit plans of Metal Technologies, Inc. ("MTI"). WHEREAS, the Employee and Employer desire to terminate the Employee's rights under the benefit plans and agreements described above and agree upon the responsibility of such payments and benefits; NOW, THEREFORE, in consideration of the agreements and covenants contained herein, the Employee and Employer hereby agree as follows: 1-6 Covenants By the Parties. 1. The Employee's Employment Agreement, dated January 30, 1998, and Change in Control Employment Agreement, dated February 19, 1990, will terminate as of the Effective Date. Except as specifically provided elsewhere in this Agreement, no further payments or other form of remuneration under the Employment Agreement and Change in Control Employment Agreement are due after the Effective Date. 2. The Employer agrees to pay the Employee a monthly salary of $15,318.00, payable in semi-monthly installments, through January 31, 2000. Thereafter, Employer shall pay Employee a monthly salary of $1,000.00 through June 30, 2000. 3 3. The Board of Directors and the Nominating, Compensation and Governance Committee, by approving this Agreement, hereby grant the Employee the right to exercise those Stock Options that are exercisable as of the Effective Date, for the lesser of three months or the balance of such Stock Option's term. The Employer further agrees that the exercise date for the 8,500 unexercisable options granted August 5, 1997 and the 11,390 unexercisable options granted August 5, 1998 be accelerated to the Effective Date and the accelerated options will be cashed out pursuant to Section 5(k) of the Briggs & Stratton Corporation Stock Incentive Plan. Other than as provided above, no further payments or other form of remuneration under the Briggs Stock Incentive Plan are due after the Effective Date. 4. By August 20, 2000 and pursuant to the terms of Briggs & Stratton's Economic Value Added Incentive Compensation Plan ("EVA Plan"), the Employee will receive the EVA bonus earned for his employment during fiscal 2000 and the entire balance of the Bonus Bank, less any amount required by law to be withheld for income or employment taxes, in complete payment of all monies earned under the EVA Plan. The Employee agrees that the Employee's participation in the EVA Plan will terminate as of the Effective Date and no further form of remuneration or payments beyond the covenants or obligations of this Termination Agreement are due employee. 5. Employee and Employer agree that as of January 31, 2000, employee will terminate further vesting under both the Briggs & Stratton Corporation Retirement Plan (Qualified Plan) and the Supplemental Retirement Plan (the "Supplemental Plan"). Any accrued benefit in such plans shall be transferred to MTI's qualified retirement plan after such plan is established. Employee shall be entitled to the pension benefit under MTI's retirement plan in accordance with the plan's provisions as they relate to vested terminees. The accrued benefit shall be calculated pursuant to the terms and conditions in existence under the Supplemental Plan as of the Effective Date. Other than the obligation to transfer Employee's accrued benefit in the Qualified Plan, and to either provide Employee with a pension benefit under the Supplemental Plan, or transfer Employee's accrued benefit under the Qualified and the Supplemental Plans, Employer shall have no further liability to Employee under the Plans. 6. Employee shall have the option any time to purchase medical coverage of any kind then available to Company employees at such active employee group rate as shall be in force at such time, for the period commencing on his Separation Date and continuing until he (or she) reaches age 65 (or such later date should Medicare or Medicaid eligibility be changed) as though he (or she) were covered by the medical coverage continuation 4 rules of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA") for that entire period. 7. Employee and Employer agree except as provided above, or required by law, that as of the Effective Date, Employee will cease to be a participant in any benefit plans of Employer. 8. Competition. As a condition to the receipt of the right to accelerate options described in Section 3 hereof which are in excess of the benefits, Employee agrees to abide by the terms of this Section 8. For a period of 3 years after the Employee's separation from service with the Employer, Employee will not, directly or indirectly, own, manage, operate, control, be connected with the ownership, management, operation or control of any entity in the United States of America which competes with the Employer, or be employed by, perform service for, consult with or solicit business for any such entity. Employee agrees that the restrictions set forth in this Section 6 are fair and reasonable and are reasonably required for the protection of the Employer. Employer's sole remedy for Employee's breach of this Section 6 shall be to forever withhold from Employee, and any person claiming through Employee, any further payments described in the first clause of the first sentence of this Section 8. 9. Non-Disclosure and Non-Solicitation. During the term of his employment with the Company and for three years after the termination of his employment with the Company for any reason, Employee shall not, and Employee shall use his best efforts (which best efforts shall include, without limitation, notifying the Board of Directors of the Company of any suspected breach of this Section 9.) to ensure that any persons or entities over which Employee has control do not, directly or indirectly, use any Company proprietary or other confidential information for any purpose not associated with Company activities, or disseminate or disclose any such information to any person or entity not affiliated with the Company. Such Company proprietary or other confidential information includes without limitation sales methods, prospecting methods, customer lists and customer contacts, computer technology, programs and data, whether on-line or off-loaded on disk format, inventions, improvements, trade secrets, drawings, designs, cost information, prototypes, new product plans, proposed product improvements, methods of presentation and any other plans, programs and materials used in managing, marketing or furthering Company business. Upon termination of Employee's employment relationship with the Company, Employee shall return to the Company all documents, records, notebooks, manuals, computer disks and similar repositories of or containing Company proprietary or other confidential information, including all copies thereof, then in Employee's possession or control, 5 whether prepared by Employee or otherwise. Employee shall undertake all reasonably necessary and appropriate steps to ensure that the confidentiality of Company proprietary or other confidential information shall be maintained. 10. Release. The Employee, for himself, his heirs, personal representatives and assigns does hereby remise, release and discharge Briggs & Stratton Corporation, its subsidiaries, affiliates, its officers, directors, employees and its agents, attorneys, heirs, successors ("Released Parties") of and from any and all manner of action or actions, cause or cause of action, suits, debts, covenants, contracts, agreements, judgments, executions, claims (including, but not limited to, contribution), liabilities, obligations and demands whatsoever in law or equity, whether known or unknown, anticipated or unanticipated, matured or unmatured, liquidated or unliquidated, fixed or contingent, which the Employee now has or may have against the Released Parties, for or by reason of any transaction, matter cause or thing whatsoever whether based on tort, contract, or otherwise, expressed or implied, or any federal, state or local law, statute, or regulation concerning the benefit plans or agreements described above in this Agreement; provided, however that this Agreement shall not release the Released Parties from the covenants or obligations set forth in this Agreement. 11. Entire Agreement. This Agreement constitutes the entire agreement among the parties with respect to the subject matter described herein and there are no understandings or agreements relating to this Agreement that are not fully expressed in this Agreement. 12. Waivers and Amendments. This Agreement may be amended, superseded, canceled, renewed, or modified, and the terms hereof may be waived only by a written instrument signed by the parties or, in the case of a waiver, by the party waiving compliance. No delay on the part of any party in exercising any right, power, or privilege hereunder shall operate as a waiver thereof. 13. Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns and legal representatives. 6 14. Counterparts. This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same agreement. 15. Headings. The headings in this Agreement are for reference only, and shall not affect the interpretation of this Agreement. 16. Governing Law. This Agreement and the transactions contemplated hereby shall be construed in accordance with and governed by the internal laws of the State of Wisconsin. 17. Reformation and Severability. If any provision of this Agreement shall be held to be invalid, unenforceable or illegal in any jurisdiction under any circumstances for any reason, (i) such provision shall be reformed to the minimum extent necessary to cause such provision to be valid, enforceable and legal and preserve the original intent of the parties, or (ii) if such provision cannot be so reformed, such provision shall be severed from this Agreement. Such holding shall not affect or impair the validity, enforceability or legality of such provision in any other jurisdiction or under any other circumstances. Neither such holding nor such reformation or severance shall affect or impair the legality, validity or enforceability of any other provisions of this Agreement to the extent that such other provision is not itself actually in conflict with any applicable law. IN WITNESS HEREOF, the parties hereto have caused this Agreement to be executed as of the 2nd day of Feb, 2000. /s/ Gerald E. Zitzer /s/ John S. Shiely - ---------------------- ------------------------------------- Gerald E. Zitzer John S. Shiely President and Chief Operating Officer EX-11 4 COMPUTATION OF EARNINGS PER SHARE OF COMMON STOCK 1 EXHIBIT 11 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES COMPUTATION OF EARNINGS PER SHARE OF COMMON STOCK (In thousands except per share data)
Quarter Ended Nine Months Ended ------------------------- ------------------------- March 26, March 28, March 26, March 28, 2000 1999 2000 1999 --------- --------- --------- --------- COMPUTATIONS FOR STATEMENTS OF INCOME Net income $42,056 $41,813 $108,903 $ 70,891 ======== ======== ======== ======== Basic earnings per share of common stock: Average shares of common stock outstanding 22,842 23,271 23,021 23,399 ======== ======== ======== ======== Basic earnings per share of common stock $ 1.84 $ 1.80 $ 4.73 $ 3.03 ======== ======== ======== ======== Diluted earnings per share of common stock: Average shares of common stock outstanding 22,842 23,271 23,021 23,399 Incremental common shares applicable to common stock options based on the common stock average market price during the period 24 84 81 80 Incremental common shares applicable to restricted common stock based on the common stock average market price during the period - 2 2 1 -------- -------- -------- -------- Average common shares assuming dilution 22,866 23,357 23,104 23,480 ======== ======== ======== ======== Fully diluted earnings per average share of common stock, assuming conversion of all applicable securities $ 1.84 $ 1.79 $ 4.71 $ 3.02 ======== ======== ======== ========
EX-12 5 COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES 1 EXHIBIT 12 BRIGGS & STRATTON CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (Dollars in thousands)
Nine Months Ended --------------------------------- March 26, 2000 March 28, 1999 -------------- --------------- Net income $ 108,903 $ 70,891 Add: Interest 15,151 13,183 Income tax expense and other taxes on income 63,960 42,543 Fixed charges of unconsolidated subsidiaries 89 226 --------- ----------- Earnings as defined $ 188,103 $ 126,843 ========= =========== Interest $ 15,151 $ 13,183 Fixed charges of unconsolidated subsidiaries 89 226 -------- ----------- Fixed charges as defined $ 15,240 $ 13,409 ========= =========== Ratio of earnings to fixed charges 12.34 x 9.46 x ========= ===========
EX-27.(A) 6 FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE NINE MONTHS ENDED MARCH 26, 2000, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 9-MOS JUL-02-2000 JUN-28-1999 MAR-26-2000 13,805 0 433,866 0 239,941 746,437 825,014 432,198 1,194,280 556,618 0 0 0 289 417,398 1,194,280 1,189,849 1,189,849 932,904 932,904 68,931 0 15,151 172,863 63,960 108,903 0 0 0 108,903 4.73 4.71
EX-27.(B) 7 RESTATED FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE FISCAL YEAR ENDED JUNE 27, 1999, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. CURRENT ASSET INFORMATION HAS BEEN RECLASSIFIED TO CONFORM TO THE CURRENT YEAR PRESENTATION. 1,000 12-MOS JUN-27-1999 JUN-29-1998 JUN-27-1999 60,806 0 194,096 0 137,448 442,852 859,848 455,394 875,885 282,502 0 0 0 289 365,910 875,885 1,501,726 1,501,726 1,196,371 1,196,371 118,560 0 17,024 169,771 63,670 106,101 0 0 0 106,101 4.55 4.52 REPRESENTS RECLASSIFICATION OF CURRENT ASSETS TO CONFORM TO CURRENT YEAR PRESENTATION
EX-27.(C) 8 RESTATED FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE NINE MONTHS ENDED MARCH 28, 1999, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. CURRENT ASSET INFORMATION HAS BEEN RECLASSIFIED TO CONFORM TO THE CURRENT YEAR PRESENTATION. 1,000 9-MOS JUN-27-1999 JUN-29-1998 MAR-28-1999 26,166 0 342,958 0 127,926 548,682 842,040 444,495 974,897 388,534 0 0 0 289 338,826 974,897 1,060,183 1,060,183 848,269 848,269 85,297 0 13,183 113,434 42,543 70,891 0 0 0 70,891 3.03 3.02 REPRESENTS RECLASSIFICATION OF CURRENT ASSETS TO CONFORM TO CURRENT YEAR PRESENTATION
EX-27.(D) 9 RESTATED FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE SIX MONTHS ENDED DECEMBER 27, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. CURRENT ASSET INFORMATION HAS BEEN RECLASSIFIED TO CONFORM TO THE CURRENT YEAR PRESENTATION. 1,000 6-MOS JUN-27-1999 JUN-29-1998 DEC-27-1998 2,243 0 302,050 0 172,503 522,177 829,358 433,394 945,205 390,252 0 0 0 289 305,896 945,205 583,924 583,924 474,841 474,841 54,407 0 8,158 46,518 17,440 29,078 0 0 0 29,078 1.24 1.23 REPRESENTS RECLASSIFICATION OF CURRENT ASSETS TO CONFORM TO CURRENT YEAR PRESENTATION
EX-27.(E) 10 RESTATED FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE QUARTER ENDED SEPTEMBER 27, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. CURRENT ASSET INFORMATION HAS BEEN RECLASSIFIED TO CONFORM TO THE CURRENT YEAR PRESENTATION. 1,000 3-MOS JUN-27-1999 JUN-29-1998 SEP-27-1998 7,108 0 149,072 0 156,683 356,397 820,747 429,015 777,466 226,030 0 0 0 289 299,849 777,466 223,981 223,981 186,369 186,369 27,101 0 3,410 7,101 2,660 4,441 0 0 0 4,441 .19 .19 REPRESENTS RECLASSIFICATION OF CURRENT ASSETS TO CONFORM TO CURRENT YEAR PRESENTATION
EX-27.(F) 11 RESTATED FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE FISCAL YEAR ENDED JUNE 28, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. CURRENT ASSET INFORMATION HAS BEEN RECLASSIFIED TO CONFORM TO THE CURRENT YEAR PRESENTATION. 1,000 12-MOS JUN-28-1998 JUN-30-1997 JUN-28-1998 84,527 0 136,629 0 107,876 372,791 812,428 420,501 793,409 222,945 0 0 0 289 316,199 793,409 1,327,610 1,327,610 1,072,936 1,072,936 122,177 0 19,352 113,145 42,500 70,645 0 0 0 70,645 2.86 2.85 REPRESENTS RECLASSIFICAITON OF CURRENT ASSETS TO CONFORM TO CURRENT YEAR PRESENTATION
EX-27.(G) 12 RESTATED FINANCIAL DATA SCHEDULE
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BRIGGS & STRATTON CORPORATION FOR THE FISCAL YEAR ENDED JUNE 29, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. CURRENT ASSET INFORMATION HAS BEEN RECLASSIFIED TO CONFORM TO THE CURRENT YEAR PRESENTATION. 1,000 12-MOS JUN-29-1997 JUL-01-1996 JUN-29-1997 112,859 0 129,877 0 125,957 413,039 796,714 400,448 842,189 213,994 0 0 0 289 350,808 842,189 1,316,413 1,316,413 1,095,197 1,095,197 112,031 0 9,880 99,305 37,740 61,565 0 0 0 61,565 2.16 2.15 REPRESENTS RECLASSIFICATION OF CURRENT ASSETS TO CONFORM TO CURRENT YEAR PRESENTATION
-----END PRIVACY-ENHANCED MESSAGE-----