-----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, Fti/tHemkCRfFsky5HwKXhcpRoV4TwRR03YaxB2EPy30WtKpv0x7Dsxe1t2RoWUC yHZTA50QwD3HwkQRiRZS1Q== 0000950133-97-002855.txt : 19970814 0000950133-97-002855.hdr.sgml : 19970814 ACCESSION NUMBER: 0000950133-97-002855 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970629 FILED AS OF DATE: 19970813 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENICOM CORP CENTRAL INDEX KEY: 0000766738 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 510271821 STATE OF INCORPORATION: DE FISCAL YEAR END: 1230 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-14685 FILM NUMBER: 97658577 BUSINESS ADDRESS: STREET 1: 14800 CONFERENCE CNTR DR STREET 2: STE 400 WESTFIELDS CITY: CHANTILLY STATE: VA ZIP: 22021-3806 BUSINESS PHONE: 7038029200 10-Q 1 FORM 10-Q FOR PERIOD ENDED 6-29-97 1 ================================================================================ FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 [x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 29, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from _______to_______ Commission File No.: 0-14685 GENICOM CORPORATION (Exact name of registrant as specified in it charter) DELAWARE 51-0271821 (State or other jurisdiction of (I.R.S. Employer Incorporation or organization) Identification No.) 14800 CONFERENCE CENTER DRIVE SUITE 400, WESTFIELDS CHANTILLY, VIRGINIA 20151 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (703) 802-9200 Indicate by a check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes x No - - As of August 4, 1997, there were 11,041,635 shares of Common Stock of the Registrant outstanding. ================================================================================ 2 FORM 10-Q INDEX PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets - June 29, 1997 and December 29, 1996 3 Consolidated Statements of Income - Three Months and Six Months Ended June 29, 1997 and June 30, 1996 4 Consolidated Statements of Cash Flows - Three Months and Six Months Ended June 29, 1997 and June 30, 1996 5 Notes to Consolidated Financial Statements 6 - 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 10 - 14 PART II - OTHER INFORMATION Item 1. Legal Proceedings 15 Item 2. Changes in Securities 15 Item 3. Defaults Upon Senior Securities 15 Item 4. Submission of Matters to a Vote of Security Holders 15 Item 5. Other Information 15 Item 6. Exhibits and Reports on Form 8-K 15-16 Signatures 17 Index to Exhibits E-1
3 PART I. - FINANCIAL INFORMATION Item 1. Financial Statements GENICOM CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
JUNE 29, DECEMBER 29, (In thousands, except share data) 1997 1996 ============= ============= (UNAUDITED) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 4,389 $ 5,866 Accounts receivable, less allowance for doubtful accounts of $3,829 and $3,270 65,111 65,404 Other receivables 3,017 1,835 Inventories 58,695 46,947 Prepaid expenses and other assets 7,836 5,395 ------------- ------------- TOTAL CURRENT ASSETS 139,048 125,447 Property, plant and equipment 26,502 26,562 Goodwill 25,698 27,555 Intangibles and other assets 4,737 6,515 ------------- ------------- $ 195,985 $ 186,079 ============= ============= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Debt maturing within one year $ 4,166 $ 4,222 Accounts payable and accrued expenses 64,920 72,040 Deferred income 12,339 13,094 ------------- ------------- TOTAL CURRENT LIABILITIES 81,425 89,356 Long-term debt, less current portion 61,390 50,331 Other non-current liabilities 10,343 8,801 ------------- ------------- TOTAL LIABILITIES 153,158 148,488 STOCKHOLDERS' EQUITY: Common stock, $0.01 par value; 18,000,000 shares authorized, 11,021,479 and 10,983,439 shares issued 110 110 Additional paid-in capital 26,494 26,440 Retained earnings 17,525 12,162 Foreign currency translation adjustment (1,302) (1,121) ------------- ------------- TOTAL STOCKHOLDERS' EQUITY 42,827 37,591 ------------- ------------- $ 195,985 $ 186,079 ============= =============
The accompanying notes are an integral part of these financial statements. 3 4 GENICOM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
THREE MONTHS ENDED, SIX MONTHS ENDED, JUNE 29, JUNE 30, JUNE 29, JUNE 30, (In thousands, except per share data) 1997 1996 1997 1996 ============= ============== ============== ============== REVENUES, NET: Products $ 69,568 $ 40,706 $ 135,202 $ 83,302 Services 29,079 28,433 59,790 59,390 ------------- -------------- -------------- -------------- 98,647 69,139 194,992 142,692 ------------- -------------- -------------- -------------- OPERATING COSTS AND EXPENSES: Cost of revenues: Products 46,959 28,092 91,915 58,638 Services 27,829 25,888 55,253 51,588 Selling, general and administration 15,668 12,756 32,785 25,287 Engineering, research and product development 2,916 1,966 5,461 3,897 Gain on sale of investment in subsidiary (1,481) (1,481) Acquisition related costs ------------- -------------- -------------- -------------- 93,372 67,221 185,414 137,929 ------------- -------------- -------------- -------------- OPERATING INCOME 5,275 1,918 9,578 4,763 Interest expense, net 1,659 1,000 3,032 2,152 Other income (90) ------------- -------------- -------------- -------------- INCOME BEFORE INCOME TAXES 3,616 918 6,546 2,701 Income tax expense 773 229 1,186 591 ------------- -------------- -------------- -------------- INCOME BEFORE EXTRAORDINARY ITEM 2,843 689 5,360 2,110 EXTRAORDINARY ITEM - LOSS ON EXTINGUISHMENT OF DEBT, NET OF $258 TAX (8) (422) ------------- -------------- -------------- -------------- NET INCOME $ 2,843 $ 681 $ 5,360 $ 1,688 ============= ============== ============== ============== Earnings per common share and common share equivalent (primary and fully diluted) $ 0.23 $ 0.06 $ 0.43 $ 0.14 ============= ============== ============== ============== Weighted average number of common shares and common share equivalents outstanding Primary 12,377 12,270 12,287 12,261 ============= ============== ============== ============== Fully diluted 12,429 12,270 12,414 12,261 ============= ============== ============== ==============
The accompanying notes are an integral part of these financial statements. 4 5 GENICOM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
SIX MONTHS ENDED, JUNE 29, JUNE 30, (In thousands) 1997 1996 ------------- -------------- Cash flows from operating activities: Net income $ 5,360 $ 1,688 Adjustments to reconcile net income to cash provided by operating activities: Depreciation 6,642 7,866 Amortization 2,296 1,695 Gain on sale of Genicom de Mexico (1,481) Changes in assets and liabilities net of effects from acquisitions: Accounts receivable (889) 2,892 Inventories (11,748) 13,041 Accounts payable and accrued expenses (7,121) (14,147) Deferred income (755) 1,143 Other 1,216 (2,097) ------------- ------------- NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES (4,999) 10,600 ------------- ------------- Cash flows from investing activities: Sale of Genicom de Mexico 3,950 Additions to property, plant and equipment (7,235) (6,546) Other (259) ------------- ------------- NET CASH USED IN INVESTING ACTIVITIES (7,235) (2,855) ------------- ------------- Cash flows from financing activities: Borrowings from long-term debt 22,567 53,225 Payments on long-term debt (11,564) (59,339) Financing costs and transactions (165) (1,259) ------------- ------------- NET CASH PROVIDED (USED IN) BY FINANCING ACTIVITIES 10,838 (7,373) ------------- ------------- Effect of exchange rate changes on cash and cash equivalents (81) 8 ------------- ------------- Net (decrease) increase in cash and cash equivalents (1,477) 380 Cash and cash equivalents at beginning of period 5,866 4,271 ------------- ------------- Cash and cash equivalents at end of period $ 4,389 $ 4,651 ============= =============
The accompanying notes are an integral part of these financial statements 5 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. In the opinion of management, the accompanying unaudited consolidated financial statements of GENICOM Corporation and subsidiaries (the "Company" or "GENICOM") contain all adjustments (consisting only of normal recurring accruals) necessary to present fairly the Company's consolidated financial position as of June 29, 1997, and the results of operations and cash flows for the periods indicated. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 29, 1996 Annual Report. The results of operations for the six months ended June 29, 1997, are not necessarily indicative of the operating results to be expected for the full year. 2. Inventories are stated at the lower of cost, determined on the first-in, first-out method, or market. Inventories consist of, in thousands:
JUNE 29, DECEMBER 29, 1997 1996 =========== =========== Raw materials $ 11,287 $ 9,105 Work in process 3,159 3,383 Finished goods 44,249 34,459 ----------- ----------- $ 58,695 $ 46,947 =========== ===========
3. Earnings per share are based upon the weighted average number of common shares and dilutive common share equivalents (using the treasury stock method) outstanding during the period.
THREE MONTHS ENDED SIX MONTHS ENDED ========================= ======================== JUNE 29, JUNE 30, JUNE 29, JUNE 30, 1997 1996 1997 1996 ========= ========= ========= ========= Weighted average common share outstanding 11,016 10,928 11,007 10,893 --------- --------- --------- --------- Dilutive common stock equivalents: Options- Primary 1,361 1,342 1,280 1,368 --------- --------- --------- --------- Shares outstanding - Primary 12,377 12,270 12,287 12,261 ========= ========= ========= ========= Dilutive common stock equivalents: Options - Fully diluted 1,413 1,342 1,407 1,368 --------- --------- --------- --------- Shares outstanding - Fully diluted 12,429 12,270 12,414 12,261 ========= ========= ========= =========
4. For reporting periods ending after December 15, 1997, the Company will be required to report earnings per share in accordance with SFAS No. 128 "Earnings per Share". Basic earnings per share would have been $0.26 and $0.06 for the second quarter of 1997 and 1996, respectively, and $0.49 and $0.15 for the six months ended June 29, 1997 and June 30, 1996, respectively, if calculated pursuant to SFAS No. 128. 6 7 5. Texas Instruments Worldwide Printer Business On September 30, 1996, the Company acquired certain assets of Texas Instruments worldwide printer and related supplies business for the purchase price of approximately $29.5 million. The acquisition was financed primarily through the Company's credit facility with NationsBank and a note of $9 million to Texas Instruments with interest of approximately 8.5% payable over two years. The goodwill of approximately $10 million associated with the purchase is being amortized over seven years. Pro Forma Financial Information Presented below are the unaudited pro forma statements of operations as if the acquired operations had been integrated into the Company effective January 1, 1996. Accounting adjustments have been made in the pro forma financial information to include estimated costs of the combinations and to reflect the integration and consolidation of facilities and personnel. Included in such integration costs are relocation costs associated with facilities and employee expenses. This pro forma information has been prepared for comparative purposes only and does not purport to be indicative of the results that actually would have been obtained if the acquired operations had been conducted by the Company during the periods presented, and is not intended to be a projection of future results. Presentation is in thousands except for earnings per share amounts.
Three Months Ended Six Months Ended ------------------------ -------------------------- June 29, June 30, June 29, June 30, 1997 1996 1997 1996 ---------- ---------- ----------- ---------- Revenue $ 98,647 $ 93,624 $ 194,992 $ 197,007 Pre-Tax Income 3,616 2,639 6,546 6,518 ---------- ---------- ----------- ---------- Net Income 2,843 1,817 5,360 4,207 ---------- ---------- ----------- ---------- Earnings per share $ 0.23 $ 0.15 $ 0.43 $ 0.34 ---------- ---------- ----------- ---------- Weighted average shares outstanding 12,429 12,270 12,414 12,261 ---------- ---------- ----------- ----------
6. Commitments and Contingencies Environmental matters: The Company and the former owner of its Waynesboro, Virginia facility, General Electric Company ("G.E."), have generated and managed hazardous wastes at the facility for many years as a result of their use of certain materials in manufacturing processes. The Company and the United States Environmental Protection Agency ("EPA") have agreed to a corrective action consent order (the "Order"), which became effective on September 14, 1990. The Order requires the Company to undertake an investigation of solid waste management units at its Waynesboro, Virginia facility and to conduct a study of any necessary corrective measures that may be required. The investigative work under the Order is expected to be completed by December 1997. Although not required by the Order, the Company has agreed to install and operate an interim ground water stabilization system, subject to EPA approval of the system design. In 1996, the Company recorded a reserve for $0.6 million for pond closure and monitoring for ten years related to the Waynesboro facility. The interim groundwater stabilization program may be chosen as the final remedy for the site, or additional corrective measures may eventually be required. It is not possible to reliably estimate the costs that any such possible additional corrective measures would entail. However, if additional corrective 7 8 measures are required, the Company expects that it will enter into discussion with EPA concerning their scope and a further order for that purpose. The Company has been notified by the EPA that it is one of 700 potentially responsible parties ("PRPs") under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, for necessary corrective action at a hazardous waste disposal site in Greer, South Carolina. In prior years, the Company arranged for the transportation of wastes to the site for treatment or disposal. During 1995, the PRPs entered into an administrative consent order with EPA under which they will undertake a remedial investigation and feasibility study which is currently underway. The Company was named as a defendant in an Original Petition and Petition for Injunctive Relief filed in August 1995 which alleged that the Company and certain other defendants were strictly liable for damages allegedly suffered by the plaintiffs as a result of contamination of groundwater at the Linn-Faysville Aquifer, in Texas, due to the disposal of dangerous products and materials at a landfill which was alleged to be the source of the contamination. This matter was settled in May 1997 without the Company admitting liability, curtailing additional legal expenses. The Company was fully reserved for the amount of the settlement and related legal expenses. Atlantic Design: In December 1995, the Company entered into a five year agreement later extended one year with Atlantic Design Company, a subsidiary of Ogden Services Corporation, ("ADC") in which ADC took over the Company's manufacturing operations and employees in McAllen, Texas and Reynosa, Mexico. The agreement is automatically renewed unless notice is given. ADC is committed to manufacturing all of the Company's impact printer products, printed circuit boards, related supplies and spare parts. The Company will retain design, intellectual and distribution rights. As part of this agreement, the Company is to be a preferred provider of impact and page printers and multivendor information technology services to Ogden Services Corporation. Ogden Services Corporation is attempting to divest ADC. The Company's agreement with ADC contains a clause requiring GENICOM's consent to the sale, which consent cannot be unreasonably witheld. The Company is currently evaluating this situation and preliminary information received from ADC concerning a potential customer. In early August 1997, the Company received notification that ADC was filing a Demand for Arbitration with the American Arbitration Association seeking a legal interpretation of the pricing provisions in the Agreement between ADC and the Company and the recovery of an amount in dispute said to be approximately $2,000,000. The Company and ADC have been in discussions concerning certain issues under the agreement and, to date, have been unable to resolve the open issues. The Company is considering its response to ADC's filing, including whether it wishes to raise certain other claims in the arbitration proceeding relating to ADC's performance under the agreement, the amount of which claims, the Company believes, exceed those raised by Atlantic Design. The Company cannot presently predict the outcome of this matter or how the respective claims will be resolved. Neither the arbitration proceeding nor the resolution of the open issues between the Company and ADC is expected to impact the continued supply of the products ADC is manufacturing for the Company. Other matters: In July 1996, the Company reached an agreement with Electronic Data Systems ("EDS") to outsource its information systems and data processing activities. Under the agreement, EDS will operate and service the Company's systems as well as design, install and service new business systems and global networks. The agreement covers ten years with an average base cost of $4.3 million per year. In the ordinary course of business, the Company is party to various environmental, administrative and legal proceedings. In the opinion of management, the Company's liability, if any, in all pending litigation or other legal proceedings, other than those discussed above, will not have a material effect upon the financial condition, results of operations or liquidity of the Company. On August 8, 1997, Genicom signed a multi-year agreement with Digital Equipment Corporation ("DEC") to provide printer products, sales and support for DEC branded printers and related supplies and services. The agreement, which becomes effective August 10, 1997, includes the Company's 8 9 acquisition of certain assets including certain intellectual property rights to use the DEC brand for approved printer products. 7. On July 3, 1997, the Company amended it credit agreement with NationsBank of Texas, N.A., as agent for a group of banks, which increased the Company's revolving credit line from $35 million to $40 million. Other terms and conditions of the credit agreement generally remained unchanged. 9 10 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition: RESULTS OF OPERATIONS
======================================================================================================================== THREE MONTHS ENDED SIX MONTHS ENDED -------------------------------- ----------------------------------- 2ND QTR. 2ND QTR. 2ND QTR. 2ND QTR. (in millions) 1997 CHANGE 1996 1997 CHANGE 1996 - ------------------------------------------------------------------------------------------------------------------------ Revenues - Enterprising Service Solutions $ 29.1 $ 0.7 $ 28.4 $ 59.8 $ 0.4 $ 59.4 Revenues - Document Solutions 69.5 28.8 40.7 135.2 51.9 83.3 -------- -------- ------- -------- ------- ------- Total Revenue $ 98.6 $ 29.5 $ 69.1 $ 195.0 $ 52.3 $ 142.7 -------- -------- ------- -------- ------- ------- Percentage change 42.7% 36.7% ========================================================================================================================
Revenue in the second quarter of 1997 increased 42.7% from the second quarter of 1996 primarily due to the revenue growth in Document Solutions ("DSC") as a result of the acquisition of Texas Instruments' printer business. DSC revenue, excluding Relays, was 75.5% higher than the second quarter of 1996 as a result of the acquisition of the Texas Instruments' printer and related supplies business. Enterprising Service Solutions ("ESSC") revenue increased 2.3%. Integrated Network Service ("INS"), which is part of ESSC, revenue increased 14.0% on strong performance of the Canadian subsidiary. Revenue from Multivendor Services ("MVS"), also part of ESSC, was flat in the second quarter of 1997 compared to the year ago quarter. MVS is currently transitioning its depot operations from Bedford, Massachusetts and Waynesboro, Virginia to a single depot in Louisville, Kentucky. The loss of revenue from the Bedford depot, which closed early in the second quarter, has not yet been fully recovered by the Louisville depot which is not yet completely operational. Some of the legacy revenue from Bedford was not transferred to the Louisville depot. For 1997 year to date, revenue increased $52.3 million from 1996. DSC's revenue, excluding Relays, increased $49.9 million or 65.2% primarily due to the Texas Instruments acquisition. ESSC's revenue for 1997 increased only $0.4 million compared to 1996 principally from strong performance by Canadian INS which was partially offset by lower revenue from MVS. The decline in revenue by MVS was primarily a result of the decline of legacy revenue in the Bedford depot and the consolidation of the depots mentioned above. Relay revenues, which are included as part of Document Solutions in the above table, increased by $0.8 million or 22.9% in the second quarter of 1997 as compared to the prior year quarter. For 1997 year to date, relay revenues have increase $2.0 million from 1996.
=================================================================================================== 2ND QUARTER 4TH QUARTER 2ND QUARTER (in millions) 1997 1996 1996 - --------------------------------------------------------------------------------------------------- Order Backlog $ 51.9 $ 56.7 $ 39.6 Change: 2nd Quarter of 1997 compared to Amount (4.8) 12.3 Percentage -8.5% 31.1% ===================================================================================================
The increase in order backlog from the second quarter of 1996 primarily reflects the effect of the Texas Instruments acquisition. The decrease in the backlog from the fourth quarter of 1996 is principally the result of a decline of $3.7 million in relays backlog and $2.0 million in ESSC backlog. The Company's backlog as of any particular date should not be the sole measurement used in determining sales for any future period. 10 11
============================================================================================================================ THREE MONTHS ENDED SIX MONTHS ENDED ----------------------------------- ------------------------------------- 2ND QTR. 2ND QTR. 2ND QTR. 2ND QTR. (in millions) 1997 CHANGE 1996 1997 CHANGE 1996 - ---------------------------------------------------------------------------------------------------------------------------- Gross margin - Enterprising Service Solutions $ 1.2 $ (1.3) $ 2.5 $ 4.5 $ (3.3) $ 7.8 Gross margin - Document Solutions 22.6 10.0 12.6 43.3 18.6 24.7 ------- --------- ------- -------- -------- -------- Total gross margin $ 23.8 $ 8.7 $ 15.1 $ 47.8 $ 15.3 $ 32.5 ------- --------- ------- -------- -------- -------- As a % of revenue 24.2% 24.5% ============================================================================================================================
Gross margin, as a percent of revenue, increased from 21.9% in the second quarter of 1996 to 24.2% in the second quarter of 1997. As a percent of revenue, gross margin for DSC excluding Relays increased to 32.8% for the quarter ending June 29, 1997 from 31.6% for the quarter ending June 30, 1996. This increase is primarily the result of the high volume of supplies sales which carry a larger margin percentage than printers. For ESSC, gross margin decreased from 8.9% for the second three months of 1996 to 4.3% for 1997 reflecting the costs associated with consolidation of the depots and redundant costs between depots. Relays gross margin increased from 24.9% to 28.1% reflecting more efficient operation of this small business unit. As a percent of revenue, gross margin for the six months ended June 29, 1997 was 24.5% as compared to 22.7% for the six months ended June 30, 1996. The gross margin percentage for DSC for the first six months of 1997 increased to 32.6% from 31.2% in 1996 due to the large volume of supplies sales. ESSC's gross margin percentage declined to 7.6% for year to date 1997 from 13.1% for the same period in 1996. Relay's gross margin increased from 12.0% to 23.9%.
====================================================================================================================== THREE MONTHS ENDED SIX MONTHS ENDED ----------------------------------- ----------------------------------- 2ND QTR. 2ND QTR. 2ND QTR. 2ND QTR. (in millions) 1997 CHANGE 1996 1997 CHANGE 1996 - ---------------------------------------------------------------------------------------------------------------------- Operating expenses: Selling, general and administrative $ 15.7 $ 2.9 $ 12.8 $ 32.8 $ 7.5 $ 25.3 Engineering, research and product development 2.9 0.9 2.0 5.4 1.5 3.9 ------- ------- ------- ------- ------ ------- Total $ 18.6 $ 3.8 $ 14.8 $ 38.2 $ 9.0 $ 29.2 ------- ------- ------- ------- ------ ------- As a % of revenue 18.9% 21.4% 19.6% 20.5% ======================================================================================================================
The increase of $3.8 million in operating expenses from the second quarter of 1996 was primarily a result of elevated levels of spending needed to support the higher revenue in 1997 including the new products acquired from Texas Instruments, increased MIS costs as a result of the outsourcing of this business function in July of 1996, transition costs to the new Louisville depot and higher compensation and benefit costs. Engineering increased $0.9 million due to development costs related to the new travel printer business acquired from Texas Instruments. Operating expenses declined as a percentage of revenue in the second quarter of 1997 to 18.9% as compared to 21.4% in 1996. For the first six months of 1997, operating expenses increased $9.0 million compared to 1996 primarily for the reasons mentioned above. 11 12
==================================================================================================== THREE MONTHS ENDED SIX MONTHS ENDED --------------------------------- --------------------------------- 2ND QTR. 2ND QTR. 2ND QTR. 2ND QTR. (in millions) 1997 CHANGE 1996 1997 CHANGE 1996 - ---------------------------------------------------------------------------------------------------- Interest expense, net $ 1.7 $ 0.7 $ 1.0 $ 3.0 $ 0.8 $ 2.2 Percentage change 70.0% 36.4% ====================================================================================================
The interest expense increased $0.7 million in the second quarter of 1997 as compared to the year-ago quarter primarily as a result of higher borrowings in 1997 due to the debt associated with the acquisition of the Texas Instruments' printer business, increased working capital needs to support the business expansion being experienced by the Company, the consolidation of the Massachusetts and Virginia depots and increased capital expenditures for the Company's new business system. Interest expense for the six months ended June 29, 1997 increased $0.8 million compared to the same period in 1996 for the above reasons.
============================================================================================ THREE MONTHS ENDED SIX MONTHS ENDED ------------------------------ -------------------------------- 2ND QTR. 2ND QTR. 2ND QTR. 2ND QTR. (in millions) 1997 CHANGE 1996 1997 CHANGE 1996 - -------------------------------------------------------------------------------------------- Income tax expense $ 0.8 $ 0.6 $ 0.2 $ 1.2 $ 0.6 $ 0.6 Effective tax rate 21.4% 25.0% 18.1% 21.9% ============================================================================================
During the first six months of 1997, the Company reversed part of its valuation allowance for its foreign deferred tax assets. The benefit from the reversal was recorded in the first quarter of 1997 based upon management's estimate of the value from the utilization of foreign net operating losses as the foreign subsidiaries become operationally profitable. For the first six months of 1997, the tax rate was 18.1% compared to 21.9% in 1996. In 1996, the tax rate was effected by reversal of certain domestic valuation allowances. LIQUIDITY AND CAPITAL RESOURCES
========================================================================================= SIX MONTHS ENDED --------------------------------- 2ND QUARTER 2ND QUARTER (in millions) 1997 1996 - ----------------------------------------------------------------------------------------- Cash (used in) provided by operations $ (5.0) $ 10.6 Cash used in investing activities (7.2) (2.9) Cash provided by (used in) financing activities 10.8 (7.4) =========================================================================================
12 13
======================================================================== 2ND QUARTER 4TH QUARTER (in millions) 1997 1996 - ------------------------------------------------------------------------ Working capital $ 57.6 $ 36.1 Inventories 58.7 46.9 Debt obligations 65.6 54.5 Debt to equity ratio 1.5 to 1 1.5 to 1 ========================================================================
Cash used by operations changed $15.6 million from the first half of 1996 principally as a result of higher inventory and accounts receivable balances necessary to support the increased levels of revenue. The Company's working capital increased $21.5 million as of June 29, 1997 as compared to December 29, 1996 due primarily to a $11.8 million increase in inventory necessary to support the higher level of sales and a $7.2 million decrease in accounts payable. Debt increased significantly with the proceeds used to support the working capital needs of the business, the closing of the depots, the increased capital expenditures of the new business systems and from the acquisition of the Texas Instruments printer business. Debt to equity ratio remained unchanged as a result of increased earnings. On July 3, 1997, the Company amended its credit agreement with NationsBank of Texas, N.A., as agent for a group of banks, which increased the Company's revolving credit line from $35 million to $40 million. Other terms and conditions of the credit agreement generally remained unchanged. As of June 29, 1997, the Company had $9.7 million available for borrowing under its revolving credit agreement. On August 8, 1997, Genicom signed a multi-year agreement with Digital Equipment Corporation ("DEC") to provide printer products, sales and support for DEC branded printers and related supplies and services. The agreement, which becomes effective August 10, 1997, includes the Company's acquisition of certain assets including certain intellectual property rights to use the DEC brand for approved printer products. In early August 1997, the Company received notification that Atlantic Design Company, a principal supplier of the Company's printer products, was filing a Demand for Arbitration with the American Arbitration Association seeking a legal interpretation of the pricing provisions in the services agreement between ADC and the Company and the recovery of an amount in dispute said to be approximately $2,000,000. The Company is considering its response to ADC's filing, including whether it wishes to raise certain other claims in the arbitration proceeding relating to ADC's performance under the agreement, the amount of which claims, the Company believes, exceed those raised by Atlantic Design. The Company cannot presently predict the outcome of this matter or how the respective claims will be resolved. Neither the arbitration proceeding nor the resolution of the open issues between the Company and ADC is expected to impact the continued supply of the products ADC is manufacturing for the Company. GENICOM provides an array of services and products addressing different niches of the information processing industry, competing against a wide range of companies from large multinationals to small domestic entrepreneurs. Except for the historical information contained herein, the matters discussed in this 10Q include forward-looking statements that involve a number of risks and uncertainties. Terms such as "believes", "expects", "plans", "intends", "estimates", or "anticipates", and variations of such words and similar expressions are intended to identify such forward looking statements. There are certain important factors and risks, including the change in hardware and software technology, economic conditions in the North American and Western European markets, the anticipation of growth of certain market segments and the positioning of the Company's products and services in those segments, selective service customers whose business is declining, seasonality in the buying cycles of certain of the Company's customers, the timing of product announcements, the release of new or enhanced products and services, the introduction of competitive products and services by existing or new competitors, access to and development of product rights and technologies, the management of growth, disruption in the ability of Atlantic Design Corporation to maintain its production commitments to the Company, changes in the costs of production of the Company's products and services, including any that may arise as a result of the resolution of claims raised by Atlantic Design Company, Inc. under its December 18, 1995 Services Agreement with the Company, the integration of acquisitions, including but not limited to the Company's acquisition of Texas Instruments printer business as of September 30, 1996 and the Company's transaction with Digital Equipment Corporation as of August 10, 1997, the transitioning of the Bedford and Waynesboro depots to Louisville, Kentucky, GENICOM's ability to retain highly skilled technical, managerial and sales and marketing personnel, possible litigation related to the Company's operations, including litigation arising under various environmental laws, and the other risks detailed from 13 14 time to time in the Company's SEC reports, including reports on Form 10K, that could cause results to differ materially from those anticipated by the statements contained herein. 14 15 PART II. - OTHER INFORMATION Item 1. Legal Proceedings: Not applicable. Item 2. Changes in Securities: Not applicable. Item. 3 Defaults Upon Senior Securities: Not applicable. Item 4. Submission of Matters to a Vote of Security Holders: a) The Company's annual meeting of stockholders was held May 21, 1997. c) At said annual meeting, stockholders reelected the Company's three directors, adopted the Company's 1997 Stock Option Plan and approved the appointment of Cooper & Lybrand L.L.P. as the Company's independent accountants. Directors
Director Votes for Withheld Broker Non-Votes -------- --------- -------- ---------------- Don E. Ackerman 8,379,369 88,541 0 Edward E. Lucente 8,381,469 86,441 0 Paul T. Winn 8,381,032 86,878 0
Stock Option Plan
Abstentions or -------------- Votes for Votes against Broker Non-Votes --------- ------------- ---------------- 7,381,082 862,018 23,786
Accountants
Abstentions or -------------- Votes for Votes against Broker Non-Votes --------- ------------- ---------------- 8,425,214 36,286 6,410
Item 5. Other Information: In early August 1997, the Company received notification that Atlantic Design Company, Inc., a principal supplier of the Company's printer products, was filing a Demand for Arbitration with the American Arbitration Association seeking a legal interpretation of the pricing provisions in the December 18, 1995 Services Agreement between Atlantic Design and the Company and the recovery of an amount in dispute said to be approximately $2,000,000. The Company and Atlantic Design have been in discussions concerning the Services Agreement and, to date, have been unable to resolve the open issues by agreement. The Company is considering its response to Atlantic Design's filing, including whether it wishes to raise certain other claims in the arbitration proceeding relating to Atlantic Design's performance under the Services Agreement, the amount of which claims, the Company believes, exceed those raised by Atlantic Design. The Company cannot presently predict the outcome of this matter or how the respective claims will be resolved. Neither the arbitration proceeding nor the resolution of the open issues between the Company and Atlantic Design is expected to impact the continued supply of the products Atlantic Design is manufacturing for the Company. Item 6. Exhibits and Reports on Form 8-K: a) Exhibits 15 16
NUMBER DESCRIPTION ============ ============================================================================== 10.1 Credit Agreement dated as of July 3, 1997, Fourth Amendment to Credit and Security Agreement 27.1 Financial Data Schedule
b) Reports on Form 8-K: The Company did not file a Form 8-K during the quarter ended June 29, 1997. 16 17 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. GENICOM Corporation -------------------------- Registrant Date: August 13, 1997 /s/Harold L. McIlroy -------------------------- Signature Harold L. McIlroy Vice President, Quality & Customer Satisfaction, General Manager, Operations (Mr. McIlroy is a Corporate Vice President and has been duly authorized to sign on behalf of the Registrant) 17 18 GENICOM Corporation and Subsidiaries INDEX TO EXHIBITS TO FORM 10-Q FOR THE QUARTERLY PERIOD ENDED JUNE 29, 1997
EXHIBIT NUMBER DESCRIPTION PAGE - ----------- ------------------------------------------------------------------ ------------------ 10.1 Credit Agreement dated as of July 3, 1997, Fourth Amendment to E-2 - E-12 Credit and Security Agreement 27.1 Financial Data Schedule Filed only with EDGAR version
E-1 EX-10.1 2 CREDIT AGREEMENT 1 FOURTH AMENDMENT TO CREDIT AGREEMENT THIS FOURTH AMENDMENT TO CREDIT AGREEMENT, (this "Amendment"), dated as of July 3, 1997, is by and among Genicom Corporation (the "Borrower"), the subsidiaries of the Borrower identified on the signature pages hereto (the "Guarantors"), the several lenders identified on the signature pages hereto (each a "Lender" and, collectively, the "Lenders") and NationsBank of Texas, N.A., as agent for the Lenders (in such capacity, the "Agent"). Capitalized terms used herein which are not defined herein and which are defined in the Credit Agreement shall have the same meanings as therein defined. W I T N E S S E T H WHEREAS, the Borrower, the Guarantors, the Lenders and the Agent entered into that certain Credit Agreement dated as of January 12, 1996, as previously amended (as previously amended, the "Existing Credit Agreement"). WHEREAS, the parties have agreed to amend the Existing Credit Agreement as set forth herein. NOW, THEREFORE, in consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: PART 1 DEFINITIONS SUBPART 1.1 Certain Definitions. Unless otherwise defined herein or the context otherwise requires, the following terms used in this Amendment, including its preamble and recitals, have the following meanings: "Amended Credit Agreement" means the Existing Credit Agreement as amended hereby. "Amendment No. 4 Effective Date" is defined in Subpart 3.1. SUBPART 1.2 Other Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Amendment, including its preamble and recitals, have the meanings provided in the Amended Credit Agreement. PART 2 AMENDMENTS TO EXISTING CREDIT AGREEMENT Effective on (and subject to the occurrence of) the Amendment No. 4 Effective Date, the Existing Credit Agreement is hereby amended in accordance with this Part 2. Except as so E-2 2 amended, the Existing Credit Agreement and all other Credit Documents shall continue in full force and effect. SUBPART 2.1 Amendments to Section 1.1. (a) The definition of "Permitted Investments" set forth in Section 1.1 of the Existing Credit Agreement is hereby amended in its entirety to read as follows: "Permitted Investments" means Investments which are either (i) cash and Cash Equivalents; (ii) accounts receivable created, acquired or made by the Borrower or any of its Subsidiaries in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; (iii) Investments consisting of stock, obligations, securities or other property received by the Borrower or any of its Subsidiaries in settlement of accounts receivable (created in the ordinary course of business) from bankrupt obligors; (iv) Investments existing as of the Closing Date and set forth in Schedule 1.1B, (v) additional Investments in any Subsidiary of the Borrower which is a Guarantor; (vi) subject to the terms of Section 7.15(b), additional Investments in Subsidiaries of the Borrower which are not Guarantors not to exceed $10,000,000 at any one time outstanding; (vii) Guaranty Obligations permitted by Section 8.1; (viii) acquisitions permitted by Section 8.4(c); (ix) transactions permitted by Section 8.8; (x) loans to directors, officers, employees, agents, customers or suppliers that do not exceed an aggregate principal amount of $1,000,000 at any one time outstanding; and (xi) a secured loan to Corporation C in a principal amount not to exceed $5,000,000; provided, however, that no such loan shall be made until such time as the Agent shall have received (A) the original copy of the Corporation C Note and all collateral documents executed in connection therewith (which collateral documents shall be in form and substance satisfactory to the Agent and the Lenders), endorsed or assigned by the Borrower to the Agent in a manner reasonably satisfactory to the Agent and the Lenders, and (B) an original, executed copy of the subordination agreement(s) executed by the holders of outstanding senior and subordinated debt of Corporation C in form and substance satisfactory to the Agent and the Lenders. (b) The following definitions are hereby added to Section 1.1 of the Existing Credit Agreement in appropriate alphabetical order: (i) "Corporation C" means a Delaware corporation, the identity of which has been separately disclosed by the Borrower to the Lenders and the Agent. (ii) "Corporation C Note" means that certain promissory note executed by Corporation C in favor of the Borrower evidencing all indebtedness owed by Corporation C to the Borrower in an aggregate amount not to exceed $5,000,000. 2 E-3 3 SUBPART 2. Amendments to Section 2.1. Subsection (a) of Section 2.1 of the Existing Credit Agreement is hereby amended in its entirety to read as follows: (a) Revolving Commitment. Subject to the terms and conditions hereof and in reliance upon the representations and warranties set forth herein, each Lender severally agrees to make available to the Borrower such Lender's Revolving Commitment Percentage of revolving credit loans in Dollars ("Revolving Loans") from time to time from the Effective Date until the Termination Date, or such earlier date as the Revolving Commitments shall have been terminated as provided herein for the purposes hereinafter set forth; provided, however, that the sum of the aggregate principal amount of outstanding Revolving Loans shall not exceed the lesser of (a) FORTY MILLION DOLLARS ($40,000,000.00) (as such aggregate maximum amount may be reduced from time to time as provided in Section 3.4(a), the "Revolving Committed Amount") and (b) the Borrowing Base; provided, further, (i) with regard to each Lender individually, such Lender's outstanding Revolving Loans shall not exceed such Lender's Revolving Commitment Percentage of the Revolving Committed Amount, and (ii) with regard to the Lenders collectively, the aggregate principal amount of outstanding Revolving Loans plus the Dollar Amount (as determined as of the most recent Determination Date) of the aggregate principal amount of outstanding Foreign Currency Loans plus the aggregate principal amount of outstanding Swingline Loans plus LOC Obligations outstanding shall not exceed the lesser of (A) the Revolving Committed Amount and (B) the Borrowing Base. Revolving Loans may consist of Base Rate Loans or Eurodollar Loans, or a combination thereof, as the Borrower may request, and may be repaid and reborrowed in accordance with the provisions hereof; provided, however, that (x) during the Initial Interest Rate Period, all Eurodollar Loans shall have an Interest Period of one (1) month and (y) no more than 10 Eurodollar Loans shall be outstanding hereunder at any time. For purposes hereof, Eurodollar Loans with different Interest Periods and/or in different currencies shall be considered as separate Eurodollar Loans, even if they begin on the same date, although borrowings, extensions and conversions may, in accordance with the provisions hereof, be combined at the end of existing Interest Periods to constitute a new Eurodollar Loan with a single Interest Period and in the same currency. Revolving Loans hereunder may be repaid and reborrowed in accordance with the provisions hereof. SUBPART 2.2 Replacement of Schedule 2.1(a). Schedule 2.1(a) to the Existing Credit Agreement is hereby deleted in its entirety and a new schedule in the form of Schedule 2.1(a) attached hereto is substituted therefor. PART 3 CONDITIONS TO EFFECTIVENESS SUBPART 3.1 Amendment No. 4 Effective Date. This Amendment shall be and become effective as of the date hereof (the "Amendment No. 4 Effective Date") when all of the conditions set forth in this Subpart 3.1 shall have been satisfied, and thereafter this Amendment shall be known, and may be referred to, as "Amendment No. 4." 3 E-4 4 SUBPART 3.1.1 Execution of Counterparts of Amendment. The Agent shall have received counterparts of this Amendment, which collectively shall have been duly executed on behalf of the Borrower, each of the Guarantors and each of the Lenders. SUBPART 3.1.2 Corporate Authority. The Agent shall have received all documents it may reasonably request relating to the corporate or other necessary authority for and the validity of this Amendment, and any other matters relevant thereto, all in form and substance reasonably satisfactory to the Agent. SUBPART 3.1.3 Legal Opinions. The Agent shall have received a legal opinion of McGuire, Woods, Battle & Boothe, counsel for the Credit Parties in form and substance reasonably satisfactory to the Agent. SUBPART 3.1.4 Officer's Certificate. The Agent shall have received a certificate executed by the chief financial officer of the Borrower as of the Amendment No. 4 Effective Date stating that, immediately after giving effect to this Amendment, (i) each of the Credit Parties is Solvent, (ii) no Default or Event of Default exists and (iii) the representations and warranties set forth in the Existing Credit Agreement are true and correct in all material respects. SUBPART 3.1.5 Amendment Fee. The Agent shall have received, for the account of each Lender, an amendment fee equal to 7.5 basis points on the aggregate amount of such Lenders' Commitment. SUBPART 3.1.6 Confirmation Letter. The Agent shall have received a letter from the Borrower confirming the identity of Corporation C. SUBPART 3.1.7 Other Items. The Agent shall have received such other documents, agreements or information which may be reasonably requested by the Agent. PART 4 MISCELLANEOUS SUBPART 4.1 Representations and Warranties. The Borrower hereby represents and warrants to the Agent and the Lenders that, after giving effect to this Amendment, (a) no Default or Event of Default exists under the Credit Agreement or any of the other Credit Documents and (b) the representations and warranties set forth in Section 6 of the Existing Credit Agreement are, subject to the limitations set forth therein, true and correct in all material respects as of the date hereof (except for those which expressly relate to an earlier date). SUBPART 4.2 Secured Obligations. The Borrower and the Guarantors hereby acknowledge and agree that the term "Secured Obligations" as defined in each of the Security Agreement and the Pledge Agreement shall be deemed to include all amounts owing under the 4 E-5 5 Amended, Restated and Substituted Revolving Note of even date herewith executed by the Borrower in favor of NationsBank and all other additional indebtedness incurred in connection therewith. SUBPART 4.3 Cross-References. References in this Amendment to any Part or Subpart are, unless otherwise specified, to such Part or Subpart of this Amendment. SUBPART 4.4 Instrument Pursuant to Existing Credit Agreement. This Amendment is a Credit Document executed pursuant to the Existing Credit Agreement and shall (unless otherwise expressly indicated therein) be construed, administered and applied in accordance with the terms and provisions of the Existing Credit Agreement. SUBPART 4.5 References in Other Credit Documents. At such time as this Amendment No. 4 shall become effective pursuant to the terms of Subpart 3.1, all references in the Credit Documents to the "Credit Agreement" shall be deemed to refer to the Credit Agreement as amended by this Amendment. SUBPART 4.6 Counterparts. This Amendment may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the same agreement. SUBPART 4.7 Governing Law. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE COMMONWEALTH OF VIRGINIA WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF. SUBPART 4.8 Successors and Assigns. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. [The remainder of this page has been left blank intentionally] 5 E-6 6 IN WITNESS WHEREOF the parties hereto have caused this Amendment to be duly executed on the date first above written. BORROWER: GENICOM CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer GUARANTORS: GENICOM INTERNATIONAL HOLDINGS CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer GENICOM INTERNATIONAL SALES CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer DELMARVA TECHNOLOGIES CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer RASTEK CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer [Signatures Continued] E-7 7 ENTERPRISING SERVICE SOLUTIONS CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer PRINTER SYSTEMS CORPORATION By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer THE PRINTER CONNECTION, INC. By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer PRINTER SYSTEMS INTERNATIONAL, LTD. By: /s/ James C. Gale Title: Senior Vice President and Chief Financial Officer LENDERS: NATIONSBANK OF TEXAS, N.A. By /s/ Brent W. Mellow Title: Senior Vice President [Signatures Continued] E-8 8 CREDITANSTALT-BANKVEREIN By /s/Richard P. Buckanavage Title: Vice President By /s/ Catherine K MacDonald Title: Senior Associate AERIES FINANCE, LTD. By /s/ Andrew Wignall Title: Director SENIOR DEBT PORTFOLIO By: Boston Management and Research, as Investment Advisor By /s/ Scott H. Page Title: Vice President RESTRUCTURED OBLIGATIONS BACKED BY SENIOR ASSETS, B.V. By Chancellor LGT Senior Secured Management, Inc. as Portfolio Advisor By /s/Christopher A. Bondy Title: Vice President UNITED STATES NATIONAL BANK OF OREGON By /s/Douglas A. Rich Title: Vice President [Signatures Continued] E-9 9 CRESTAR BANK By /s/William F. Lindlaw Title: Vice President THE RIGGS NATIONAL BANK OF WASHINGTON, D.C. By /s/ Jeffrey P. White Title: Vice President AGENT: NATIONSBANK OF TEXAS, N.A., as Agent By /s/ Brent W. Mellow Title: Senior Vice President E-10 10
- ------------------------------------------------------------------------------------------------------- SCHEDULE 2.1(a) LENDERS, COMMITMENTS AND COMMITMENT PERCENTAGES - ------------------------------------------------------------------------------------------------------- Foreign Name Revolving Foreign Currency and Address Revolving Commitment Currency Commitment of Lenders Commitment Percentage Commitment Percentage - ------------------------------------------------------------------------------------------------------- NationsBank of Texas, N.A. $12,045,454.54 30.1136363500% $3,818,181.82 76.3636% 901 Main Street, 67th Floor Dallas, Texas 75202 ATTN: Brent W. Mellow Facsimile No.: (214) 508-0980 - ------------------------------------------------------------------------------------------------------- Creditanstalt-Bankverein $8,272,727.28 20.6818182000% $1,181,818.18 23.6364% Two Greenwich Plaza Greenwich, Connecticut 06830 ATTN: Rich Buckanavage Facsimile No.: (203) 861-6594 - ------------------------------------------------------------------------------------------------------- United States National Bank of $6,363,636.36 15.9090909000% --- --- Oregon 555 S.W. Oak Street Suite 400 - PL-4 Portland, Oregon 97204 ATTN: Doug Rich Facsimile No.: (503) 275-4267 - ------------------------------------------------------------------------------------------------------- Crestar Bank $7,909,090.91 19.7727272750% --- --- 1445 New York Avenue, N.W. 3rd Floor Washington, D.C. 20005 ATTN: Bill Lindlaw Facsimile No.: (202) 879-6432 - ------------------------------------------------------------------------------------------------------- The Riggs National Bank of $5,409,090.91 13.5227272750% --- --- Washington, D.C. 808 17th Street, N.W., 10th Floor Washington, D.C. 20074-0649 ATTN: Jeffrey P. White Facsimile No.: (202) 835-5977 - ------------------------------------------------------------------------------------------------------- Aeries Finance Ltd. --- --- --- --- c/o Moore Management Services Limited - -------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------- SCHEDULE 2.1(a) LENDERS, COMMITMENTS AND COMMITMENT PERCENTAGES - -------------------------------------------------------------------------------------------------------- Tranche A Tranche B Name Tranche A Term Loan Tranche B Term Loan and Address Term Loan Commitment Term Loan Commitment of Lenders Commitment Percentage Commitment Percentage - -------------------------------------------------------------------------------------------------------- NationsBank of Texas, N.A. $3,994,592.19 27.272727329% --- --- 901 Main Street, 67th Floor Dallas, Texas 75202 ATTN: Brent W. Mellow Facsimile No.: (214) 508-0980 - -------------------------------------------------------------------------------------------------------- Creditanstalt-Bankverein $3,727,888.98 23.636363562% --- --- Two Greenwich Plaza Greenwich, Connecticut 06830 ATTN: Rich Buckanavage Facsimile No.: (203) 861-6594 - -------------------------------------------------------------------------------------------------------- United States National Bank of $2,517,606.90 18.18181818% --- --- Oregon 555 S.W. Oak Street Suite 400 - PL-4 Portland, Oregon 97204 ATTN: Doug Rich Facsimile No.: (503) 275-4267 - -------------------------------------------------------------------------------------------------------- Crestar Bank $2,139,965.88 15.45454545% --- --- 1445 New York Avenue, N.W. 3rd Floor Washington, D.C. 20005 ATTN: Bill Lindlaw Facsimile No.: (202) 879-6432 - -------------------------------------------------------------------------------------------------------- The Riggs National Bank of $2,139,965.88 15.45454545% --- --- Washington, D.C. 808 17th Street, N.W., 10th Floor Washington, D.C. 20074-0649 ATTN: Jeffrey P. White Facsimile No.: (202) 835-5977 - -------------------------------------------------------------------------------------------------------- Aeries Finance Ltd. --- --- 4,376,872.75 25.00000000% c/o Moore Management Services Limited - --------------------------------------------------------------------------------------------------------
E-11 11
- ------------------------------------------------------------------------------------------------------- SCHEDULE 2.1(a) --------------- LENDERS, COMMITMENTS AND COMMITMENT PERCENTAGES - ------------------------------------------------------------------------------------------------------- Foreign Name Revolving Foreign Currency and Address Revolving Commitment Currency Commitment of Lenders Commitment Percentage Commitment Percentage - ------------------------------------------------------------------------------------------------------- Elizabeth House, Castle Street St. Helier, Jersey Channel Islands, Great Britain ATTN: Director Facsimile No.: 011-441-534-616900 with a copy to: - --------------- Aeries Finance Ltd. Chancellor LGT Senior Secured Management 1166 Avenue of the Americas, 27th Floor New York, New York 10036 ATTN: Chris Bondy Facsimile No.: (212) 278-9619 - ------------------------------------------------------------------------------------------------------- Senior Debt Portfolio --- --- --- --- Eaton Vance Management 24 Federal Street Boston, Massuchusetts 02110 ATTN: Payson Swaffield Facsimile No.: (617) 695-9594 - ------------------------------------------------------------------------------------------------------- Restructured Obligations --- --- --- --- backed by Senior Assets B.V. Chancellor Senior Secured Management 1166 Avenue of the Americas, 27th Floor New York, New York 10036 ATTN: Chris Bondy Facsimile No.: (212) 278-9619 =======================================================================================================
- ------------------------------------------------------------------------------------------------------- SCHEDULE 2.1(a) --------------- LENDERS, COMMITMENTS AND COMMITMENT PERCENTAGES - ------------------------------------------------------------------------------------------------------- Tranche A Tranche B Name Tranche A Term Loan Tranche B Term Loan and Address Term Loan Commitment Term Loan Commitment of Lenders Commitment Percentage Commitment Percentage - ------------------------------------------------------------------------------------------------------- Elizabeth House, Castle Street St. Helier, Jersey Channel Islands, Great Britain ATTN: Director Facsimile No.: 011-441-534-616900 with a copy to: - --------------- Aeries Finance Ltd. Chancellor LGT Senior Secured Management 1166 Avenue of the Americas, 27th Floor New York, New York 10036 ATTN: Chris Bondy Facsimile No.: (212) 278-9619 - ------------------------------------------------------------------------------------------------------- Senior Debt Portfolio --- --- $8,753,745.50 50.00000000% Eaton Vance Management 24 Federal Street Boston, Massuchusetts 02110 ATTN: Payson Swaffield Facsimile No.: (617) 695-9594 - ------------------------------------------------------------------------------------------------------- Restructured Obligations --- --- $4,376,872.25 25.00000000% backed by Senior Assets B.V. Chancellor Senior Secured Management 1166 Avenue of the Americas, 27th Floor New York, New York 10036 ATTN: Chris Bondy Facsimile No.: (212) 278-9619 =======================================================================================================
E-12 EX-27.1 3 FINANCIAL DATA SCHEDULE
5 6-MOS DEC-28-1997 DEC-30-1996 JUN-29-1997 4,389 0 65,111 (3,829) 58,695 139,048 93,962 (67,460) 195,985 81,425 0 0 0 110 42,717 195,985 135,202 194,992 91,915 147,168 38,246 0 3,032 6,546 1,186 5,360 0 0 0 5,360 0.43 0.43
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