-----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, T8vMsUT090EQ/J90u9QRCStKcwuWah/kx86d392MaB30Yi5fvonFOz6gfTJgdZKu HX7SM3I/38PKciIBluc9JA== 0000930661-01-000388.txt : 20010214 0000930661-01-000388.hdr.sgml : 20010214 ACCESSION NUMBER: 0000930661-01-000388 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010213 FILER: COMPANY DATA: COMPANY CONFORMED NAME: POLYPHASE CORP CENTRAL INDEX KEY: 0000748212 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-CONSTRUCTION & MINING (NO PETRO) MACHINERY & EQUIP [5082] IRS NUMBER: 232708876 STATE OF INCORPORATION: NV FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-09083 FILM NUMBER: 1537241 BUSINESS ADDRESS: STREET 1: 4800 BROADWAY SUITE A CITY: ADDISON STATE: TX ZIP: 75001 BUSINESS PHONE: 9723860101 MAIL ADDRESS: STREET 1: 4800 BROADWAY SUITE A CITY: ADDISON STATE: TX ZIP: 75001 FORMER COMPANY: FORMER CONFORMED NAME: KAPPA NETWORKS INC DATE OF NAME CHANGE: 19910721 10-Q 1 0001.txt FORM 10-Q U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2000 [ ] 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: 1-9083 POLYPHASE CORPORATION (Exact name of registrant as specified in its charter) Nevada 23-2708876 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 4800 Broadway, Suite A Addison, Texas 75001 (Address of principal executive offices) (972) 386-0101 (Registrants'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 Exchange Act during the past 12 months (or for such shorter period 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. Common Stock, $.01 par value 17,827,464 ------------------------------- Outstanding at February 8, 2001 POLYPHASE CORPORATION FORM 10-Q QUARTER ENDED DECEMBER 31, 2000 - ------------------------------------------------------------------------------- TABLE OF CONTENTS ----------------- PART I. FINANCIAL INFORMATION Page No. - ----------------------------- -------- Item 1. Financial Statements Consolidated Condensed Balance Sheets as of December 31, 2000 and September 30, 2000 2 Consolidated Condensed Statements of Operations for the Three Months Ended December 31, 2000 and 1999 4 Consolidated Condensed Statements of Cash Flows for the Three Months Ended December 31, 2000 and 1999 5 Notes to Consolidated Condensed Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3. Quantitative and Qualitative Disclosures about Market Risk 13 PART II - OTHER INFORMATION - --------------------------- Item 1. Legal Proceedings 14 Item 6. Exhibits and Reports on Form 8-K 14 Signature Page 15 -1- POLYPHASE CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS Assets
December 31, September 30, ------------ ------------- 2000 2000 ------------ ------------- (Unaudited) Current assets: Cash $ 808,218 $ 1,522,347 Receivables, net of allowance for doubtful accounts of $431,361 and $433,359 Trade accounts 19,908,198 20,399,265 Current portion of sales contracts 3,772,608 4,145,318 Notes 4,093,786 3,642,112 Inventories 38,778,812 36,120,187 Prepaid expenses and other 3,282,267 3,062,932 ------------ ------------- Total current assets 70,643,889 68,892,161 ------------ ------------- Property and equipment: Land 432,000 432,000 Buildings and improvements 3,805,682 3,792,009 Machinery, equipment and other 12,570,094 11,986,465 ------------ ------------- 16,807,776 16,210,474 Less-Accumulated depreciation (8,528,346) (8,281,568) ------------ ------------- 8,279,430 7,928,906 ------------ ------------- Other assets: Noncurrent receivables, net of allowance for doubtful accounts of $1,200,000 Sales contracts 1,924,593 2,094,718 Related parties 1,230,640 1,202,183 Excess of cost over fair value of net assets of businesses acquired, net of accumulated amortization of $4,965,967 and $4,687,461 16,635,847 16,881,886 Other intangible assets 1,590,903 1,734,858 Restricted cash 621,613 633,124 Assets held for sale 1,926,264 1,926,264 Other 3,446,770 3,338,653 ------------ ------------- 27,376,630 27,811,686 ------------ ------------- $106,299,949 $ 104,632,753 ============ =============
The accompanying notes are an integral part of these consolidated financial statements. -2- POLYPHASE CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (continued) Liabilities and Stockholders' Equity
December 31, September 30, ------------ ------------- 2000 2000 ------------ ------------- (Unaudited) Current liabilities: Notes payable $ 8,516,501 $ 7,674,131 Accounts payable 15,629,263 14,903,684 Accrued expenses and other 3,546,164 4,004,971 Current maturities of long-term debt 3,547,429 3,891,579 ------------ ------------- Total current liabilities 31,239,357 30,474,365 Long term debt, less current maturities 41,190,162 40,859,613 Note payable and accrued interest to related party 21,147,219 20,746,384 Reserve for credit guarantees 621,613 633,124 ------------ ------------- Total liabilities 94,198,351 92,713,486 ------------ ------------- Warrants to purchase common stock in subsidiary 2,862,991 2,806,175 Stockholders' equity: Common stock, $.01 par value, authorized 100,000,000 shares, issued and outstanding 17,827,464 and 17,812,464 shares 178,275 178,125 Paid-in capital 27,612,146 27,650,734 Accumulated deficit (18,551,814) (18,715,767) ------------ ------------- Total stockholders' equity 9,238,607 9,113,092 ------------ ------------- $106,299,949 $ 104,632,753 ============ =============
The accompanying notes are an integral part of these consolidated financial statements. -3- POLYPHASE CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (Unaudited)
For the Three Months Ended December 31, -------------------------------- 2000 1999 ------------- ------------- Net revenues $ 46,728,575 $ 44,442,950 Cost of sales 38,128,318 35,000,258 ------------- ------------- Gross profit 8,600,257 9,442,692 Selling, general and administrative expenses 6,572,279 6,316,610 ------------- ------------- Operating income 2,027,978 3,126,082 ------------- ------------- Other income (expenses): Interest expense (2,173,086) (1,992,724) Interest income and other 365,877 164,726 ------------- ------------- Total other income (expenses) (1,807,209) (1,827,998) ------------- ------------- Income before income taxes, income allocable to subsidiary warrant holder and extraordinary item 220,769 1,298,084 Income taxes - (18,741) Income allocable to subsidiary warrant holder (56,816) - ------------- ------------- Income before extraordinary item 163,953 1,279,343 Extraordinary item--early extinguishment of debt - (1,290,431) ------------- ------------- Net income (loss) 163,953 (11,088) Gain on reacquired preferred stock - 351,457 ------------- ------------- Net income attributable to common stockholders $ 163,953 $ 340,369 ============= ============= Net income (loss) per share - basic and diluted: Before extraordinary item $ .01 $ .09 Extraordinary item - (.07) ------------- ------------- Net income (loss) per share $ .01 $ .02 ============= =============
The accompanying notes are an integral part of these consolidated financial statements. -4- POLYPHASE CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
For the Three Months Ended December 31, -------------------------------- 2000 1999 ------------- ------------- Cash flow provided by (used in) operating activities: Net income (loss) $ 163,953 $ (11,088) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 834,048 855,192 Provision for doubtful accounts 96,976 34,000 Income allocable to subsidiary warrant holder 56,816 - Extraordinary item - 1,290,431 Changes in: Accounts and sales contracts receivable 936,926 (1,578,258) Inventories (2,658,625) (5,353,120) Prepaid expenses and other (327,452) (235,219) Accounts payable 725,579 6,410,674 Accrued expenses and other (57,972) 95,457 ------------- ------------- Net cash provided by (used in) operating activities (229,751) 1,508,069 ------------- ------------- Cash flows provided by (used in) investing activities: Notes and other receivables (451,674) 350,497 Receivables from related parties (28,457) 27,042 Capital expenditures, net (651,078) (223,175) ------------- ------------- Net cash provided by (used in) investing activities $ (1,131,209) $ 154,364 ------------- -------------
The accompanying notes are an integral part of these consolidated financial statements. -5- POLYPHASE CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (continued) (Unaudited)
For the Three Months Ended December 31, -------------------------------- 2000 1999 ------------- ------------- Cash flows provided by (used in) financing activities: Net borrowings (principal payments ) on line of credit arrangements $ 1,002,864 $ 855,171 Borrowings on other notes payable and long-term debt 185,205 28,000,000 Principal payments on long-term debt (502,800) (867,486) Repayment of subordinated debt - (22,675,000) Exercise of common stock options 7,500 - Repurchase of stock purchase warrants (45,938) - Redemption of Overhill warrants - (3,700,000) Deferred financing costs - (1,832,907) Repurchase of convertible preferred stock - (450,000) ------------- ------------- Net cash provided by (used in) financing activities 646,831 (670,222) ------------- ------------- Net increase (decrease) in cash (714,129) 992,211 Cash - beginning of period 1,522,347 375,408 ------------- ------------- Cash - end of period $ 808,218 $ 1,367,619 ============= ============= Supplemental schedule of cash flow information: Cash paid during the period for: Interest $ 1,486,676 $ 1,667,989 Income taxes $ 50,000 $ 5,000
Supplemental schedule of noncash investing and financing activities: In November 1999, in connection with the Overhill Farms refinancing, warrants were issued having an estimated fair market value of $2,370,000. The accompanying notes are an integral part of these consolidated financial statements. -6- POLYPHASE CORPORATION AND SUBSIDIARIES Notes to Consolidated Condensed Financial Statements December 31, 2000 1. NATURE OF BUSINESS Polyphase Corporation (the "Company" or "Polyphase") is a diversified holding company that, through its subsidiaries, operates in two industry segments: the food segment and the forestry segment. The food segment (the "Food Group"), which consists of the Company's wholly-owned subsidiary, Overhill Farms, Inc. ("Overhill"), produces high quality entrees, plated meals, meal components, soups, sauces and poultry, meat and fish specialities. The Company's ownership of Overhill is subject to warrants outstanding to purchase a minority position in Overhill. The forestry segment (the "Forestry Group"), which consists of the Company's wholly-owned subsidiary Texas Timberjack, Inc. ("Timberjack" or "TTI") and its majority- owned subsidiaries Southern Forest Products LLC ("SFP") and Wood Forest Products LLC ("WFP"), distributes, leases and provides financing for industrial and commercial timber equipment and is also engaged in certain related timber and sawmill operations. 2. BASIS OF PRESENTATION The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries and its majority-owned subsidiaries. All material intercompany accounts and transactions are eliminated. Certain prior year amounts have been reclassified to conform to the current year presentation. The financial statements included herein have been prepared by the Company, without an 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 condensed or omitted pursuant to such rules and regulations. The Company believes that the disclosures are adequate to make the information presented not misleading. The information presented reflects all adjustments (consisting solely of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods when read in conjunction with the financial statements and the notes thereto included in the Company's latest financial statements filed as part of Form 10-K for the year ended September 30, 2000. -7- 3. INVENTORIES Inventories are summarized as follows: December 31, September 30, 2000 2000 ------------ ------------ Finished goods $ 28,944,243 $ 26,179,043 Raw materials 9,844,306 10,091,144 Inventory reserve (9,737) (150,000) ------------ ------------ Total $ 38,778,812 $ 36,120,187 ============ ============ As of December 31, 2000 and September 30, 2000, finished goods inventories consisted of approximately $10,763,000 and $9,655,000 in inventories at the Food Group, $17,253,000 and $15,690,000 in timber and logging related equipment, and $928,000 and $834,000 in finished wood products, respectively. As of December 31, 2000 and September 30, 2000, raw materials inventories consisted of approximately $9,015,000 and $9,289,000 in inventories at the Food Group and $829,000 and $802,000 in both unharvested and harvested but unprocessed timber, respectively. 4. TAXES For the quarter ended December 31, 2000, the actual income tax expense attributable to income from continuing operations differed from the net amounts recorded by the Company. The Company's subsidiaries recorded a provision for income taxes of approximately $300,000, based upon their effective tax rates determined as if they were separate taxpayers; the Company then applied a like amount of its existing valuation allowance as a reduction of this amount, resulting in a net income tax provision for the quarter of zero. The Company continues to maintain a valuation allowance against a portion of its net deferred tax assets due to uncertainty with respect to the future recoverability of all such amounts. 5. LONG-TERM DEBT In November 1999, Overhill refinanced substantially all its existing debt. The new facility amounted to $44 million, consisting of a $16 million line of credit provided by Union Bank of California, N.A. ("Union Bank"), together with $28 million in the form of a five-year term loan provided by Levine Leichtman Capital Partners II, L.P. ("LLCP"). The line of credit with Union Bank expires in November 2002 and provides for borrowings limited to the lesser of $16 million or an amount determined by a defined borrowing base consisting of eligible receivables and inventories. Borrowings under the line bear interest at a rate, as selected by Overhill at the time of borrowing, of prime plus .25% or LIBOR plus 2.75%. The agreement contains various covenants including restrictions on capital expenditures, requirements to maintain specified net worth levels and debt service ratios, and generally prohibits loans, advances or dividends from Overhill to the Company and limits payments of taxes and other expenses to Polyphase to specified levels. The line of credit is guaranteed by the Company and collateralized by certain assets of Overhill and the Overhill common stock owned by Polyphase. -8- The term loan with LLCP is a secured senior subordinated note bearing interest at 12% per annum, with interest payable monthly until maturity in October 2004. Principal payments in an amount equal to 50% of the excess cash flow, as defined, for Overhill's previous fiscal year are also payable annually commencing in January 2001. Voluntary principal payments are permitted after October 31, 2001, subject to certain prepayment penalties. The agreement contains various covenants including restrictions on capital expenditures, minimum EBITDA and net worth levels, and specified debt service and debt to equity ratios. In addition, the terms of the agreement restrict changes in control, generally prohibit loans, dividends or advances by Overhill to the Company and limit payments of taxes and other expenses to Polyphase to specified levels. The term loan with LLCP is guaranteed by the Company and collateralized by certain assets of Overhill. The agreement also requires Overhill to pay to LLCP, during each January, annual consulting fees of $180,000. In connection with the agreement, LLCP was issued warrants to purchase 17.5% of the common stock of Overhill, exercisable immediately at a nominal exercise price. During the first two years following the date of the agreement, Overhill has the right to repurchase 5% of Overhill's shares from LLCP for $3 million and/or to repurchase all 17.5% of the Overhill shares subject to the LLCP warrant within five days of the term loan being repaid at their then determined fair market value. If such shares are not purchased, LLCP will be entitled under the agreement to receive a cash payment of $500,000 from Overhill; such amount is being charged to expense over the term of the facility. At the date of issuance, the warrants granted to LLCP were estimated to have a fair value of $2.37 million. As a result of the transactions, Overhill repaid in full the $22.7 million senior subordinated notes and the $9.7 million balance of its revolving line of credit with previous lenders. Additionally, Overhill repurchased, for $3.7 million, the warrants held by a previous lender to purchase 30% of Overhill's common stock; the excess of such repurchase amount over the carrying value of the warrant amounted to approximately $2.3 million and was recorded as goodwill. In connection with the refinancing, Overhill was permitted to make a one-time advance of $1.25 million to Polyphase for working capital and other specified purposes. Overhill incurred costs and expenses in connection with the refinancing totaling approximately $1.9 million, substantially all of which has been, or will be, paid to the lenders. The early extinguishment of the previous indebtedness resulted in an extraordinary loss of approximately $1.3 million (net of a $500,000 refund for early payment of the senior subordinated notes) during the quarter ended December 31, 1999. -9- 6. EARNINGS PER SHARE The following table sets forth the computations of basic and diluted earnings per share: For the Three Months Ended December 31, -------------------------- 2000 1999 ----------- ----------- Numerator: Income before extraordinary item $ 163,953 $ 1,279,343 Gain on reacquired preferred stock - 351,457 ----------- ----------- 163,953 1,630,800 Extraordinary item - (1,290,431) ----------- ----------- Net income attributable to common stockholders $ 163,953 $ 340,369 =========== =========== Denominator: Denominator for basic earnings per share - weighted average shares 17,823,387 17,812,464 ----------- ----------- Effect of dilutive securities: Convertible preferred stock - 1,075,853 Stock options 50,290 - Warrants - - ----------- ----------- Dilutive potential common shares 50,290 1,075,853 ----------- ----------- Denominator for diluted earnings per share 17,873,677 18,888,317 =========== =========== Net income per share - basic and diluted: Before extraordinary item $ .01 $ .09 Extraordinary item - (.07) ----------- ----------- Net income per share $ .01 $ .02 =========== =========== -10- 7. STOCKHOLDERS' EQUITY Stock Options- During the three months ended December 31, 2000, options to purchase 15,000 shares at an exercise price of $.50 per share were exercised. Warrants- During the three months ended December 31, 2000, the Company repurchased warrants covering 210,000 shares exercisable at $1.125 per share for total consideration of approximately $46,000. Convertible Preferred Stock- During November 1999, the Company and Infinity Investors Limited, the holder of a series of the Company's preferred stock, entered into an agreement whereby, among other things, the Company agreed to repurchase all remaining preferred stock owned by Infinity, including all accrued but unpaid dividends, for $450,000 cash, and Infinity agreed to the dismissal of all litigation against the Company with respect to various matters related to its ownership of the preferred stock. As a result of the settlement, the Company recorded a gain of approximately $351,000, related to the difference in the carrying value of the preferred stock plus the accrued dividends and the settlement amount. Such amount was accounted for by recording a reduction of the Company's accumulated deficit during the quarter ended December 31, 1999. -11- ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS Statements contained in this Form 10-Q that are not historical facts, including, but not limited to, any projections contained herein, are forward-looking statements and involve a number of risks and uncertainties. The actual results of the future events described in such forward-looking statements in this Form 10-Q could differ materially from those stated in such forward-looking statements. Among the factors that could cause actual results to differ materially are: adverse economic conditions, industry competition and other competitive factors, government regulation and possible future litigation. Results of Operations Revenues for the three months ended December 31, 2000 increased $2,286,000 (5%) to $46,729,000 from $44,443,000 during the three months ended December 31, 1999. The increase in revenues is primarily attributable to continued sales gains by Overhill. Gross profits decreased $843,000 to $8,600,000 in the current year from $9,443,000 in the prior year, due in part to a decrease in gross margins rates to 18.4% in the current quarter as compared to 21.2% in the first quarter of fiscal 2000. During the period, operating income decreased to $2,028,000 in fiscal 2001 from $3,126,000 in fiscal 2000. Consolidated net income before extraordinary item for the three months ended December 31, 2000 decreased to $164,000 from $1,279,000 during the three months ended December 31, 1999. After the effect in the prior year of an extraordinary expense of $1,290,000 related to the early extinguishment of debt in connection with major refinancing by Overhill, and a gain of $351,000 on the reacquisition of preferred stock, net income attributable to common stockholders decreased to $164,000 ($.01 per share) in fiscal 2001 from $340,000 ($.02 per share) in fiscal 2000. The Food Group's revenues increased $4,316,000 (13%) to $38,478,000 for the three months ended December 31, 2000, as compared to $34,162,000 for the three months ended December 31, 1999. Gross profits decreased $421,000 (6%) to $6,646,000, compared to $7,067,000 in the prior year, due primarily to startup expenses related to the recently acquired Chicago Brothers operations and increased energy costs in Overhill's California based facilities. Operating income decreased $686,000 to $2,151,000 in the current period, compared to $2,837,000 for the same period in fiscal 2000. Revenues for the Forestry Group for the three months ended December 31, 2000 decreased $2,031,000 (19.8%) to $8,250,000 from $10,281,000 for the three months ended December 31, 1999. Operating income for the same period decreased $287,000 to $51,000 for the three months ended December 31, 2000 from $338,000 for the three months ended December 31, 1999. These decreases in revenues and operating results are due to a continued softness in the East Texas timber market, affecting the Texas Timberjack core equipment business as well as its sawmill operations, which is expected to continue at least through the next fiscal quarter. -12- Liquidity and Capital Resources During the three months ended December 31, 2000, the Company's operating activities resulted in a use of cash of approximately $230,000, compared to cash provided of $1,508,000 during the comparable period in the previous year. The use of cash during the current year is related primarily to increases in inventories by both Overhill and Texas Timberjack. During the three months ended December 31, 2000, the Company's investing activities resulted in a use of cash of approximately $1,131,000, compared to cash provided of $154,000 during the comparable period in the previous year. The Company's use of cash resulted primarily from increases in notes receivable by Texas Timberjack and from capital expenditures by both operating units. During the three months ended December 31, 2000, the Company's financing activities resulted in cash provided of approximately $647,000, compared to a use of cash of approximately $670,000 in the comparable period in the previous year. The cash provided resulted primarily from additional borrowings under Timberjack's lines of credit, utilized primarily for increases in its inventories and notes receivable and for reductions in its term loan. The Company believes that funds available to it from operations and existing capital resources will be adequate for its capital requirements for the next twelve months. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company's interest expense is affected by changes in prime and LIBOR-based lending rates as a result of its various line of credit arrangements. If these market rates increase by an average of 1% in fiscal 2001, the Company's interest expense would increase by approximately $250,000 based on the outstanding line of credit balances at December 31, 2000. The Company does not own, nor does it have an interest in any other market risk sensitive instruments. -13- PART II - OTHER INFORMATION Item 1. Legal Proceedings During fiscal 1997, five substantially identical complaints were filed in the United States District Court for the District of Nevada against the Company and certain of its current and past officers and directors. The complaints each sought certification as a class action and asserted liability based on alleged misrepresentations that the plaintiffs claimed resulted in the market price of the Company's stock being artificially inflated. Without certifying the cases as class actions, the District Court consolidated the cases into a single action. In March 2000, the District Court dismissed the plaintiffs' claims against one of the Company's officers and directors and restricted the plaintiffs from pursuing a number of their claims against the other defendants. The Court also granted the remaining defendants leave to file motions for summary judgment. Motions for summary judgment were thereafter filed, pointing out that there was no evidence to support the plaintiffs' claims. In November 2000, in a lengthy decision addressing the plaintiffs' claims against each of the remaining defendants, the District Court granted the motions for summary judgment, thereby disposing of all of the claims asserted by the plaintiffs. The decision in these suits, which the Company maintained all along were without merit, remains subject to appeal by the plaintiffs. The Company and its subsidiaries are involved in certain legal actions and claims arising in the ordinary course of business. Management believes (based on the advice of legal counsel) that such litigation and claims will be resolved without material effect on the Company's financial condition, results of operations or cash flows. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits 27.1 Financial Data Schedule (b) Reports on Form 8-K - No reports on Form 8-K were filed during the quarter ended December 31, 1999. -14- SIGNATURES In accordance with the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. POLYPHASE CORPORATION (Registrant) Date: February 12, 2000 By: /s/ James Rudis ---------------------- James Rudis Chairman, President and Chief Executive Officer Date: February 12, 2000 By: /s/ William E. Shatley ---------------------- William E. Shatley Senior Vice President and Chief Financial Officer -15- INDEX TO EXHIBITS Exhibit No. Exhibit ----------- ----------------------- 27.1 Financial Data Schedule EX-27.1 2 0002.txt FINANCIAL DATA SCHEDULE
5 1000 3-MOS SEP-30-2000 DEC-31-2000 808 0 27,775 431 38,778 70,644 16,808 8,528 106,300 31,239 41,190 0 0 178 9,060 106,300 46,729 46,729 38,128 38,128 6,572 0 2,173 221 0 164 0 0 0 164 .01 .01
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