-----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, AYih/AtJINLit3GTGhcm1TpcwkFJq//QPkN3+Pb4Da3DuLEhKTl1dHHKP4ksn2pL 3W9/7/j4RYXdeG54gQDPQQ== 0000950129-97-000672.txt : 19970222 0000950129-97-000672.hdr.sgml : 19970222 ACCESSION NUMBER: 0000950129-97-000672 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970214 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DANIEL INDUSTRIES INC CENTRAL INDEX KEY: 0000026821 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823] IRS NUMBER: 741547355 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06098 FILM NUMBER: 97534030 BUSINESS ADDRESS: STREET 1: 9753 PINE LAKE DR CITY: HOUSTON STATE: TX ZIP: 77055 BUSINESS PHONE: 7134676000 MAIL ADDRESS: STREET 1: 9753 PINE LAKE DRIVE CITY: HOUSTON STATE: TX ZIP: 77055 10-Q 1 DANIEL INDUSTRIES - 12/31/96 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-Q (MARK ONE) [ ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED -------------------------------------------- OR [X] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM OCTOBER 1, 1996 TO DECEMBER 31, 1996 --------------- ----------------- Commission File Number 1-6098 -------------- DANIEL INDUSTRIES, INC. ---------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 74-1547355 - ------------------------------------ --------------------------------------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 9753 Pine Lake Drive, Houston, Texas 77055 ------------------------------------------------------ (Address of principal executive offices) (Zip Code) 713-467-6000 ---------------------------------------------------- (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 --- --- On February 7, 1997, there were outstanding 17,080,170 shares of Common Stock, $1.25 par value, of the registrant. 1 2 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS. DANIEL INDUSTRIES, INC. CONSOLIDATED BALANCE SHEET (in thousands except per share data) (Unaudited)
December 31, September 30, 1996 1996 ------------ ------------ ASSETS Current assets: Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,423 $ 8,409 Receivables, net of reserve of $1,252 and $1,029 . . . . . . . . . . . . . . 50,588 55,737 Costs and estimated earnings in excess of billings on uncompleted contracts 3,671 3,132 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,006 57,814 Deferred taxes on income . . . . . . . . . . . . . . . . . . . . . . . . . 8,807 7,440 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,618 6,547 ---------- ---------- Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . 127,113 139,079 Property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . 75,555 75,726 Intangibles and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . 30,907 33,964 ---------- ---------- $ 233,575 $ 248,769 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 18,287 $ 17,356 Current maturities of long-term debt . . . . . . . . . . . . . . . . . . . . . 5,552 5,587 Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,311 17,778 Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,591 26,584 ---------- ---------- Total current liabilities . . . . . . . . . . . . . . . . . . . . . . 72,741 67,305 Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,233 34,702 Deferred taxes on income . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,789 7,982 ---------- ---------- Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 111,763 109,989 ---------- ---------- Stockholders' equity: Preferred stock, $1.00 par value, 1,000 shares authorized, 150 shares designated as Series A junior participating preferred stock, no shares issued or outstanding . . . . . . . . . . . . . . . . . . . . . . . . Common stock, $1.25 par value, 40,000 shares authorized, 17,064 and 17,057 shares issued . . . . . . . . . . . . . . . . . . . . . . . . . 21,330 21,321 Capital in excess of par value . . . . . . . . . . . . . . . . . . . . . . . 90,732 90,678 Translation component . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,006) (3,465) Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,756 30,246 ---------- ---------- Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . 121,812 138,780 ---------- ---------- $ 233,575 $ 248,769 ========== ==========
See accompanying NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS. 2 3 DANIEL INDUSTRIES, INC. CONSOLIDATED STATEMENT OF OPERATIONS (in thousands except per share data) (Unaudited)
Quarter Ended December 31 ------------------------- 1996 1995 ---- ---- Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 53,975 $ 54,188 -------- -------- Costs and expenses: Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,272 34,338 Selling and administrative expenses . . . . . . . . . . . . . . . . . . . . 18,386 15,072 Research and development expenses . . . . . . . . . . . . . . . . . . . . . 943 383 Unusual items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,663 (1,185) Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,155 739 -------- -------- Total costs and expenses . . . . . . . . . . . . . . . . . . . . . . 73,419 49,347 -------- -------- Income (loss) before income tax expense (benefit) . . . . . . . . . . . . . . . (19,444) 4,841 Income tax expense (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . . (1,500) 2,031 -------- -------- Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(17,944) $ 2,810 ======== ======== Earnings (loss) per common share . . . . . . . . . . . . . . . . . . . . . . . . $ (1.05) $ 0.17 ======== ======== Cash dividends per common share . . . . . . . . . . . . . . . . . . . . . . . . $ 0.03 $ 0.03 ======== ======== Average number of shares outstanding . . . . . . . . . . . . . . . . . . . . . . 17,061 17,002 ======== ========
See accompanying NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS 3 4 DANIEL INDUSTRIES, INC. CONSOLIDATED STATEMENT OF CASH FLOWS (Condensed) (in thousands) (Unaudited)
Quarter Ended December 31, ------------------------- 1996 1995 ---- ---- Cash flows from operating activities: Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . $(17,944) $ 2,810 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Non-cash portion of unusual items . . . . . . . . . . . . . 5,751 Loss (gain) on divestitures of non-core product lines . . . 2,300 (1,185) Depreciation and amortization . . . . . . . . . . . . . . . 3,042 2,389 Changes in operating assets and liabilities . . . . . . . . 9,264 (2,820) -------- ------- Net cash provided by operating activities . . . . . . . . . . . . . . . 2,413 1,194 -------- ------- Cash flows from investing activities: Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . (3,107) (1,833) Proceeds from sales of assets . . . . . . . . . . . . . . . . . . . . 1,116 10,703 -------- ------- Net cash provided by (used in) investing activities . . . . . . . . . . (1,991) 8,870 -------- ------- Cash flows from financing activities: Net borrowings (payments) under notes payable . . . . . . . . . . . . 931 (3,833) Payments on long-term debt . . . . . . . . . . . . . . . . . . . . . (4,504) (3,544) Cash dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . (546) (544) Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 -------- ------- Net cash used in financing activities . . . . . . . . . . . . . . . . . (4,096) (7,921) -------- ------- Effect of exchange rate changes on cash . . . . . . . . . . . . . . . . 688 (59) -------- ------- Increase (decrease) in cash and cash equivalents . . . . . . . . . . . . (2,986) 2,084 Cash and cash equivalents, beginning of period . . . . . . . . . . . . . 8,409 4,722 -------- ------- Cash and cash equivalents, end of period . . . . . . . . . . . . . . . . $ 5,423 $ 6,806 ======== =======
See accompanying NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS. 4 5 NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS Note 1 - General The foregoing financial statements have been prepared from the books and records of Daniel Industries, Inc. ("Daniel" or the Company") without audit. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the results for the interim periods presented, are reflected in the financial statements. These condensed statements should be read in conjunction with the financial statements and the related notes included in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 1996. On December 12, 1996, the Board of Directors of the Company approved a change in the fiscal year to December 31 from September 30. This Transition Report on Form 10-Q is filed for the three-month transition period. The Company will adopt Financial Accounting Standards Board Statement No. 123, "Accounting for Stock-Based Compensation" for its year ending December 31, 1997. The Company does not intend to elect expense recognition for stock options and, therefore, implementation will not materially affect its financial statements. Note 2 - Merger On December 12, 1996, the Company issued 4,920,392 shares of its common stock in exchange for all of the outstanding common stock of Bettis Corporation ("Bettis"). The merger has been accounted for as a pooling of interests, and accordingly, the Company's financial statements have been restated to include the operations of Bettis for all periods presented. Separate results of operations for Daniel and Bettis follow:
Quarter Ended December 31, --------------------------- 1996 1995 ---- ---- (in thousands) Revenues Daniel . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 33,821 $ 39,453 Bettis . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,154 14,735 -------- -------- Combined . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 53,975 $ 54,188 ======== ======== Net income (loss) Daniel . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(17,589) (a) $ 2,175 Bettis . . . . . . . . . . . . . . . . . . . . . . . . . . . . (355) 635 -------- -------- Combined . . . . . . . . . . . . . . . . . . . . . . . . . . . $(17,944) $ 2,810 ======== ========
_________________________________ (a) Includes pretax charges of $16,663,000. See Note 3. 5 6 Note 3 - Unusual Items In the quarter ended December 31, 1996, the Company recorded unusual charges for the following items:
(in thousands) Downsizing of the Company's German operations . . . . . . . . . . . . . $ 5,100 Expenses incurred in connection with the Bettis merger . . . . . . . . 3,663 Re-organization costs, primarily severance . . . . . . . . . . . . . . 3,000 Writedowns of long-lived assets . . . . . . . . . . . . . . . . . . . . 2,600 Losses arising from the sale of product lines . . . . . . . . . . . . . 2,300 -------- Total unusual charges . . . . . . . . . . . . . . . . . . . . . . $ 16,663 ========
The unusual charges are a result of the Company's ongoing strategic evaluation. The downsizing of the German operations resulted in charges for asset impairments, inventory valuation adjustments and severance accruals. Although not a part of the above total of unusual charges, the evaluations above have resulted in the establishment of a deferred tax valuation allowance of approximately $1,500,000 relative to the utilization of the German net operating loss carryforward. In addition to the German downsizing, during the period the Company committed to disposing of certain insignificant, non-strategic product lines, determined that certain long-lived assets were impaired, and provided accruals for the severance costs of certain employees. As previously reported in the Company's Annual Report on Form 10-K for the year ended September 30, 1996, the Company sold in October 1995 a non-manufacturing property for a pretax gain of $1,185,000. Note 4 - Inventories
December 31, September 30, 1996 1996 ----------- ------------ (in thousands) Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 26,036 $ 28,794 Work-in-process . . . . . . . . . . . . . . . . . . . . . . . . . . 12,809 13,581 Finished goods . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,803 21,865 -------- -------- Inventories before LIFO reserve . . . . . . . . . . . . . . . . 58,648 64,240 Less LIFO reserve . . . . . . . . . . . . . . . . . . . . . . . . . 6,642 6,426 -------- -------- Total inventories . . . . . . . . . . . . . . . . . . . . . . . $ 52,006 $ 57,814 ======== ========
Note 5 - Notes Payable Notes payable at December 31, 1996 and September 30, 1996 of $18,287,000 and $17,356,000, respectively, consisted of borrowings under lines of credit and notes to banks. Average interest rates ranged from 6% to 8.9% at December 31, 1996. At December 31, 1996, the Company had both committed and uncommitted short-term lines of credit aggregating approximately $78,000,000. Some of these lines contain restrictions regarding the amount available for short-term borrowings or the issuance of letters of credit. At December 31, 1996 approximately $44,000,000 was available for additional short-term borrowings. 6 7 Note 6 - Long-Term Debt
December 31, September 30, 1996 1996 ----------- ------------ (in thousands) Revolving credit facility (secured by Bettis' U.S. assets and stock of its foreign subsidiaries); interest at prime rate (8.25% at December 31, 1996 and September 30, 1996); interest payable quarterly; principal due April 30, 1998 . . . . . . . . . . . . $ 21,100 $ 22,100 Payable to four insurance companies (unsecured); 11.5%; principal payable in annual installments of $2,857,140; interest payable semi-annually . . . . . . . . . . . . . . . . . . . . . . . . . 5,715 8,572 Note payable to bank (secured by Bettis' U.S. assets and stock of its foreign subsidiaries); 5.95%; principal payable in quarterly installments of $500,000; interest payable quarterly . . . . . 5,000 5,500 Term loan to bank (secured by assets of Bettis' Canadian operation); interest at the Canadian prime rate (4.75% at December 31, 1996 and 6.5% at September 30, 1996); principal and interest payable monthly; payable through August 31, 2001 . . . . . . . . . . . 1,733 1,835 Capital lease obligations . . . . . . . . . . . . . . . . . . . . . . 2,056 2,098 Miscellaneous obligations . . . . . . . . . . . . . . . . . . . . . 181 184 -------- -------- Total obligations . . . . . . . . . . . . . . . . . . . . . . . 35,785 40,289 Less portion due within one year . . . . . . . . . . . . . . . . . . 5,552 5,587 -------- -------- Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . $ 30,233 $ 34,702 ======== ========
The terms of certain financing agreements contain, among other provisions, requirements for maintaining defined levels of working capital, net worth, capital expenditures and various financial ratios, including debt to equity. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Quarter Ended December 31, 1996 vs. Quarter Ended December 31, 1995 On December 12, 1996, the Board of Directors of the Company approved a change in the fiscal year to December 31 from September 30. This Transition Report on Form 10-Q is filed for the three-month transition period. Additionally, the reported results have been restated to include Bettis which merged with a Daniel subsidiary in December 1996 in a transaction accounted for as a pooling of interests. The Company recorded pretax charges in the three months ended December 31, 1996 of $16,663,000 resulting in a net loss of $17,944,000, $1.05 per share, for the quarter compared to net income of $2,810,000, $.17 per share, for the same period in 1995. Unusual charges recorded in the current period consist of the following: 7 8
(in thousands) Downsizing of the Company's German operations . . . . . . . . . . . . . $ 5,100 Expenses incurred in connection with the Bettis merger . . . . . . . . 3,663 Re-organization costs, primarily severance . . . . . . . . . . . . . . 3,000 Writedowns of long-lived assets . . . . . . . . . . . . . . . . . . . . 2,600 Losses arising from the sale of product lines . . . . . . . . . . . . . 2,300 -------- Total unusual charges . . . . . . . . . . . . . . . . . . . . . . $ 16,663 ========
The unusual charges are a result of the Company's ongoing strategic evaluation. The downsizing of the German operations resulted in charges for asset impairments, inventory valuation adjustments and severance accruals. Although not a part of the above total of unusual charges, the evaluations above have resulted in the establishment of a deferred tax valuation allowance of approximately $1,500,000 relative to the utilization of the German net operating loss carryforward. In addition to the German downsizing, during the period the Company committed to disposing of certain insignificant, non-strategic product lines, determined that certain long-lived assets were impaired, and provided accruals for the severance costs of certain employees. Revenues for the three months ended December 31, 1996 were $53,975,000, compared to $54,188,000 for the same period in 1995. Revenues from businesses acquired by both Daniel and Bettis in 1996 of $8,133,000 were offset by a decline in revenues from sales of valve products due to the timing of orders and inclusion in the prior year of revenues aggregating $4,815,000 from divested operations. Gross margin for the three months ended December 31, 1996 declined to 33% of revenues compared to 37% in the prior period. The decline was due primarily to a change in the product mix of actuators sold. Selling and administrative ("S&A") expenses increased $3,314,000 to $18,386,000 in the current period due primarily to S&A expenses of companies acquired in 1996. Research and development expenses increased $560,000 representing increased expenditures on certain electronic development projects. In the three months ended December 31, 1995, the Company sold a non-manufacturing property in Germany resulting in a pretax gain of $1,185,000. Interest expense increased $416,000 due primarily to increased borrowings which were used to fund acquisitions by both Daniel and Bettis in 1996. The effective tax rate in the current period is different from the U.S. statutory rate due primarily to losses of the German operations for which no tax benefits are currently recognizable and the non-deductibility of certain expenses associated with the Bettis merger. Liquidity and Capital Resources The primary sources of the Company's liquidity for the quarter ended December 31, 1996 were internally generated funds and proceeds from sales of assets. These funds were used primarily for capital expenditures, payments on short-term and long-term debt and the payment of dividends. Working capital decreased $17,402,000 from September 30, 1996 to $54,372,000 at December 31, 1996 due primarily to (1) writedowns of inventories associated with the planned sales of product lines; (2) increased accrued expenses associated with the cash portion of the unusual charges expected to be paid in 1997 and (3) decreased receivables due to lower sales volume in the quarter ended December 31, 1996 compared to the quarter 8 9 ended September 30, 1996. Daniel considers its financial position to be strong with a current ratio as of December 31, 1996 of 1.7 to 1.0. Working capital at December 31, 1996 included $60,813,000 in inventory and deferred tax assets, which are not as liquid as other current assets. At December 31, 1996, the Company had both committed and uncommitted short-term lines of credit aggregating approximately $78,000,000. Some of these lines contain restrictions regarding the amount available for short-term borrowings or the issuance of letters of credit. At December 31, 1996 approximately $44,000,000 was available for short-term borrowings. Capital expenditures for the quarter ended December 31, 1996 were $3,107,000. The Company continues to seek acquisitions that would build upon its expertise in the manufacture and sale of fluid measurement, flow control, actuation and analytical products and services. The Company believes that its working capital, cash generated from operations and amounts available under its short-term lines of credit will be adequate to meet its operating needs for the foreseeable future. PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. The Company is subject to legal proceedings and claims which arise in the ordinary course of business. In the opinion of management, the amount of ultimate liability with respect to these actions will not materially affect the financial position of the Company. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. At a special meeting of stockholders held on December 12, 1996 the following proposals were approved:
Broker For Against Abstain Non-Votes --- ------- ------- --------- 1. Approval of the Agreement and Plan of Merger involving Bettis . . . . . . . 9,065,854 495,478 30,692 214,466 2. Approval of an amendment to the Company's Certificate of Incorporation to increase the number of authorized shares of common stock from 20,000,000 to 40,000,000 . 8,751,777 1,012,824 41,889 0
ITEM 5. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits *10.1 - Amendment to the Company's 1995 Non-Employee Directors' Stock Option Plan 10.2 - Amended and Restated Credit Agreement between Bank One, Texas N.A. and Bettis Corporation dated July 8, 1996, filed as Exhibit 10.4 To Bettis Corporation's, Commission File Number 0-23568, Quarterly Report on Form 10-Q for the quarter ended June 30, 1996, and hereby incorporated by reference herein. 27 - Financial Data Schedule - ----------- *Management contract or compensatory plan or arrangement. (b) During the quarter for which this report is filed, the Company filed a Current Report on Form 8-K dated December 12, 1996, which described the Bettis merger, the increase in the number of authorized shares of common stock and the change in fiscal year. 9 10 SIGNATURE 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. DANIEL INDUSTRIES, INC. ------------------------------- (Registrant) Date: February 13, 1997 By:/s/ James M. Tidwell --------------------- ---------------------------- Executive Vice President and Chief Financial Officer 10 11 INDEX TO EXHIBITS Exhibit No. Description ------- ----------- 10.1 - Amendment to the Company's 1995 Non-Employee Directors' Stock Option Plan 10.2 - Amended and Restated Credit Agreement between Bank One, Texas N.A. and Bettis Corporation dated July 8, 1996, filed as Exhibit 10.4 To Bettis Corporation's, Commission File Number 0-23568, Quarterly Report on Form 10-Q for the quarter ended June 30, 1996, and hereby incorporated by reference herein. 27 - Financial Data Schedule EX-10.1 2 AMENDMENT TO STOCK OPTION 1 EXHIBIT 10.1 AMENDMENT TO NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN The second paragraph of Article 9 of the Daniel Industries, Inc., 1995 Non-Employee Directors' Stock Option Plan is amended to read: "In the event an optionee gives notice that he does not intend to stand for reelection or is given notice that he will be asked to retire from the Board of Directors, then, notwithstanding Article 6 hereof, the Option shall become exercisable with respect to all shares subject thereto, and the Option shall terminate on the earlier of one year from the date of the annual meeting of stockholders at which the optionee's term would have expired or the date of expiration of the Option." EX-27 3 FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1996 OCT-01-1996 DEC-31-1996 5,423 0 51,840 1,252 52,006 127,113 75,555 0 233,575 72,741 0 21,330 0 0 100,482 233,575 53,975 53,975 36,272 36,272 35,992 0 1,155 (19,444) (1,500) (17,944) 0 0 0 (17,944) (1.05) (1.05) AMOUNT IS COMPRISED OF SELLING AND ADMINISTRATIVE EXPENSES OF $18,386,000, RESEARCH AND DEVELOPMENT EXPENSE OF $943,000 AND UNUSUAL ITEMS OF $16,663,000.
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