-----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, ECy5vCtDTRKS/0ivMnqc3SNUP6mRdQJizUAtJh4eHdXwGDPA8TvLRY5j6U0uKXO+ 4T0q/O55thN2klibERH2/A== 0000907098-97-000057.txt : 19970813 0000907098-97-000057.hdr.sgml : 19970813 ACCESSION NUMBER: 0000907098-97-000057 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970812 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: MLX CORP /GA CENTRAL INDEX KEY: 0000064247 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS FABRICATED METAL PRODUCTS [3490] IRS NUMBER: 380811650 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-13198 FILM NUMBER: 97656822 BUSINESS ADDRESS: STREET 1: 1000 CENTER PL CITY: NORCROSS STATE: GA ZIP: 30093 BUSINESS PHONE: 4047980677 MAIL ADDRESS: STREET 1: 1000 CENTER PL CITY: NORCROSS STATE: GA ZIP: 30093 FORMER COMPANY: FORMER CONFORMED NAME: MCLOUTH STEEL CORP DATE OF NAME CHANGE: 19850212 10-Q 1 CONFORMED SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarter ended JUNE 30, 1997 Commission File Number I-4795 MLX CORP. (Exact name of registrant as specified in its charter) GEORGIA 38-0811650 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1000 CENTER PLACE, NORCROSS, GEORGIA 30093 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (770) 798-0677 Indicate by check mark whether the Registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirement for the past 90 days. Yes XX No ___ The number of shares outstanding of the Registrant's Common Stock, par value $.01, as of the close of business on June 30, 1997 was 2,617,584. PART I - FINANCIAL INFORMATION BALANCE SHEETS (UNAUDITED) MLX CORP. June 30 December 31 1997 1996 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 36,216 $ 37,927 Prepaid expenses 4 46 -------- -------- TOTAL CURRENT ASSETS 36,220 37,973 EQUIPMENT AND OTHER ASSETS 3 4 TAX ESCROW FUNDS 1,490 1,454 -------- -------- TOTAL ASSETS $ 37,713 $ 39,431 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accrued compensation and benefits $ 147 $ 103 Other accrued liabilities and expenses 301 280 Accrued taxes 262 286 --------- -------- TOTAL CURRENT LIABILITIES 710 669 OTHER LONG-TERM LIABILITIES 2,019 1,998 SHAREHOLDERS' EQUITY Common stock, $.01 par value - authorized 38,500,000 shares; 2,618,000 shares outstanding in 1997 and 1996 26 26 Capital in excess of par value 73,165 73,165 Retained earnings deficit (38,207) (36,427) -------- -------- TOTAL SHAREHOLDERS' EQUITY 34,984 36,764 -------- -------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 37,713 $ 39,431 ======== ========
Dollars in thousands See notes to financial statements STATEMENTS OF OPERATIONS (UNAUDITED) MLX CORP. For the Six Months Ended June 30 1997 1996 NET SALES $ -- $ -- General and administrative expenses (468) (536) Stock Appreciation Rights compensation (2,225) -- ------- ------- OPERATING LOSS (2,693) (536) Interest income 913 924 ------- ------- EARNINGS (LOSS) BEFORE INCOME TAXES (1,780) 388 PROVISION FOR INCOME TAXES: Federal income taxes due and payable -- (7) Charge in lieu of federal income taxes -- (132) ------- ------- NET EARNINGS (LOSS) $(1,780) $ 249 ======= ======= EARNINGS (LOSS) PER SHARE $ (0.68) $ 0.09 ======= ======= AVERAGE OUTSTANDING COMMON SHARES AND DILUTIVE OPTIONS 2,618 2,746 ======= =======
Dollars in thousands, except per share data See notes to financial statements STATEMENTS OF OPERATIONS (UNAUDITED) MLX CORP. For the Quarter Ended June 30 1997 1996 NET SALES $ -- $ -- General and administrative expenses (226) (256) ------ ------ OPERATING LOSS (226) (256) Interest income 454 464 ------ ------ EARNINGS BEFORE INCOME TAXES 228 208 PROVISION FOR INCOME TAXES: Federal income taxes due and payable -- (4) Charge in lieu of federal income taxes -- (71) ------ ------ NET EARNINGS $ 228 $ 133 ====== ====== EARNINGS PER SHARE $ 0.09 $ 0.05 ====== ====== AVERAGE OUTSTANDING COMMON SHARES AND DILUTIVE OPTIONS 2,643 2,755 ====== ======
Dollars in thousands, except per share data See notes to financial statements STATEMENTS OF CASH FLOWS (UNAUDITED) MLX CORP. For the Six Months Ended June 30 1997 1996 CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings (loss) $(1,780) $ 249 Adjustments to reconcile net earnings (loss) to net cash (used in) provided by operating activities: Charge in lieu of federal income taxes -- 132 Change in operating assets and liabilities: Prepaid expenses 42 100 Accrued expenses and other 63 71 ------- ------- Net cash (used in) provided by operating activities (1,675) 552 ------- ------- CASH FLOWS FROM INVESTING ACTIVITIES: Increase in escrow funds for warranties and taxes (36) (133) ------- ------- Net cash used in investing activities (36) (133) ------- ------- CASH FLOWS FROM FINANCING ACTIVITIES: Stock options exercised -- 26 ------- ------- Net cash provided by financing activities -- 26 ------- ------- NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (1,711) 445 Cash and cash equivalents at January 1 37,927 32,903 ------- ------- CASH AND CASH EQUIVALENTS AT JUNE 30 $36,216 $33,348 ======= ======= SUPPLEMENTAL CASH FLOW DISCLOSURE: Federal taxes paid on income $ 2 $ 25
Dollars in thousands See notes to financial statements NOTES TO FINANCIAL STATEMENTS (UNAUDITED) MLX CORP. The financial statements have been prepared by the Registrant without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to those rules and regulations. These financial statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Registrant's Annual Report on Form 10-K for the year ended December 31, 1996. In the opinion of the Registrant, the accompanying financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of June 30, 1997 and December 31, 1996 and the results of operations for the quarters and six months ended June 30, 1997 and 1996 and cash flows for the six months ended June 30, 1997 and 1996. Note A - Income Taxes At January 1, 1997, the Registrant had available net operating loss carryforwards of approximately $275 million which are available to offset future taxable income for federal income tax purposes. Accordingly, the Company has a federal tax liability only for Alternative Minimum Tax amounts and the charge in lieu of federal income taxes included in the statement of operations for the quarter and six months ended June 30, 1996 is not accruable or payable. The following table illustrates the effect of this pro forma charge on the Company's earnings and earnings per share for the respective periods (in thousands, except per share data). Quarter Ended June 30 Six months ended June 30 1997 1996 1997 1996 Net earnings (loss) $ 228 $ 133 $(1,780) $ 249 Charge in lieu of federal income taxes which is not accruable or payable -- 71 -- 132 ----- ----- ------- ----- Total earnings (loss) $ 228 $ 204 $(1,780) $ 381 ===== ===== ======= ===== Total earnings (loss) per share $0.09 $0.07 $ (0.68) $0.14 ===== ===== ======= =====
Note B - Stock Appreciation Rights Compensation On February 12, 1997, the Registrant's Board of Directors approved the conversion of all the common stock options held by its former Chief Executive Officer to Stock Appreciation Rights (SARs), and all such SARs were exercised as of that date. The resulting liability under this agreement amounted to $2.2 million and was disbursed in February 1997. The compensation expense from this transaction is reported in the accompanying statement of operations for the six months ended June 30, 1997. After this event, the Company's employees have outstanding options to purchase 50,000 shares of common stock. Note C - Accounting Policy Not Yet Adopted In February 1997, the Financial Accounting Standards Board issued Statement No. 128, Earnings per Share, which is required to be adopted on December 31, 1997. At that time, the Company will be required to change the method currently used to compute earnings per share and to restate all prior periods. Under the new requirements for calculating primary earnings per share, the dilutive effect of stock options will be excluded. The new standard is not expected to have a material effect on earnings per share. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Basis of Discussion: The accompanying financial statements report the financial condition and results of operations of the Registrant only. Since the divestiture of the S.K. Wellman subsidiary on June 30, 1995, the Registrant has no recurring revenues or operating subsidiaries. In the short-term, the Company has invested the proceeds of the Wellman transaction in short-term repurchase instruments managed by selected commercial banks. The Company is actively engaged in pursuing the acquisition of new businesses where purchase valuations are attractive but no binding agreements have been entered into for any such acquisitions. Operations: The general and administrative expenses of the Registrant are incurred for acquisition search, compensation, occupancy, shareholder costs (such as printing, distribution and stock transfer fees) and legal and professional matters. The Company considers its business to be that of seeking to acquire an operating business that meets its financial acquisition criteria. Accordingly, the Company believes that it is not an investment company as defined by the Investment Company Act of 1940 (the "Act") and prepared and submitted an application in 1996 to the Securities and Exchange Commission (the "Commission") requesting an exemption from certain provisions of the Act until December 31, 1997. On May 19, 1997, the Commission issued an exemptive order pursuant to Sections 6(c) and 6(e) of the Act, which exempts MLX from all provisions of the Act except Sections 9, 17(a), 17(d) (modified as described in the application), 17(e), 17(f) (modified as described in the application), and 36 through 53, through December 31, 1997. MLX and other persons, in their transactions and relations with MLX, are subject to such excepted sections of the Act as if MLX were a registered investment company under the Act. The implementation of the exemptive order did not require MLX to change or modify any of its existing practices or policies. If MLX has not entered into a binding agreement to acquire an operating business by December 31, 1997, MLX expects to have to register under the Act and will thereafter be subject to regulation thereunder. This action would add complexity to the Company's pursuit of its acquisition strategy, add to the administrative expenses of the Company and fundamentally alter the presentation of the Company's financial statements. Liquidity and Capital Resources: At June 30, 1997, the Registrant had working capital of $35.5 million, consisting principally of cash and short-term investments of $36.2 million, and estimated short-term obligations for income taxes, transaction expenses and compensation of $0.7 million. The Company's short-term investments at June 30, 1997 consisted principally of repurchase arrangements collateralized by U.S. Treasury and federal agency obligations. In connection with the sale of Wellman in 1995, the Company funded an escrow fund amounting to $1.3 million relating to certain estimated income tax obligations arising from the sale. The Company's common stock is quoted on the OTC Electronic Bulletin Board under the trading symbol "MLXR." The Registrant believes that its current financial resources are adequate to meet its projected operating needs in 1997. PART II - OTHER INFORMATION Item 1. Legal Proceedings None. Item 2. Changes in Securities None. Item 3. Default Upon Senior Securities None. Item 4. Submission of Matters to a Vote of Security Holders None. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K (a) Exhibit 27* - Financial Data Schedule (b) Reports on Form 8-K: None *Filed with this report. SIGNATURES Pursuant to the requirements of Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. Date: August 1, 1997 MLX Corp (Registrant) BY: /s/ THOMAS C. WAGGONER Thomas C. Waggoner Chief Executive Officer and President EX-27 2
5 ART 5 FDS FOR 2ND QUARTER 10-Q 1,000 6-MOS DEC-31-1996 JUN-30-1997 36,216 0 0 0 0 36,220 3 0 37,713 710 0 0 0 26 34,958 37,713 0 0 0 2,693 0 0 0 (1,780) 0 0 0 0 0 (1,780) (0.68) (0.68)
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