-----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, Izcy+wwjSgoLAsYlqsY3GmB9DyKt4WJgyj3l/2BjTCKKBQRVsuthBcbopz6fE1mc PypUQSoYxhbjR+A0PoNJkg== 0000778161-98-000004.txt : 19980813 0000778161-98-000004.hdr.sgml : 19980813 ACCESSION NUMBER: 0000778161-98-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19980630 FILED AS OF DATE: 19980812 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTRENET INC CENTRAL INDEX KEY: 0000778161 STANDARD INDUSTRIAL CLASSIFICATION: TRUCKING (NO LOCAL) [4213] IRS NUMBER: 351597565 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-14060 FILM NUMBER: 98682762 BUSINESS ADDRESS: STREET 1: 400 TECHNECENTER DRIVE SUITE 200 CITY: MILFORD STATE: OH ZIP: 45150 BUSINESS PHONE: 5135766666 FORMER COMPANY: FORMER CONFORMED NAME: CIRCLE EXPRESS INC DATE OF NAME CHANGE: 19900702 10-Q 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 1998 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 0-14060 INTRENET, INC. (Exact name of registrant as specified in its charter) Indiana 35-1597565 (State or other jurisdiction of (IRS Employer Identification No) incorporation or organization) 400 TechneCenter Drive, Suite 200, Milford, Ohio 45150 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (513)576-6666 Not Applicable Former name, former address and former fiscal year, if changed since last report Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No APPLICABLE ONLY TO CORPORATE ISSUERS Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock, without par value, 13,550,638 shares issued and outstanding at August 3, 1998 INTRENET, INC. FORM 10-Q JUNE 30, 1998 INDEX Page Part I - Financial Information: Item 1. Financial Statements: Condensed Consolidated Balance Sheets June 30, 1998 and December 31, 1997 .......... 3 Condensed Consolidated Statements of Operations Three Months and Six Months Ended .......... 4 June 30, 1998 and 1997 Condensed Consolidated Statement of Shareholders' Equity Six Months Ended June 30, 1998 .......... 5 Condensed Consolidated Statements of Cash Flows Three Months and Six Months Ended .......... 6 June 30, 1998 and 1997 Notes to Condensed Consolidated Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations .......... 9 Part II - Other Information: Item 1. Legal Proceedings .......... 12 Item 2. Changes in Securities .......... 12 Item 3. Defaults Upon Senior Securities.......... 12 Item 4. Submission of Matters to a Vote of Security Holders 12 Item 5. Other Information .......... 13 Item 6. Exhibits and Reports on Form 8-K......... 13 INTRENET, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets June 30, 1998 and December 31, 1997 (In Thousands of Dollars)
Assets 1998 1997 (Unaudited) Current assets: Cash and cash equivalents $ 1,064 $ 598 Receivables, principally freight revenue less allowance for doubtful accounts of $1,302 in 1998 and $1,110 in 1997 33,933 30,474 Prepaid expenses and other 6,441 4,697 Total current assets 41,438 35,769 Property and equipment, at cost, less accumulated depreciation 28,803 30,248 Reorganization value in excess of amounts allocated to identifiable assets, net of accumulated amortization 5,489 5,889 Deferred income taxes, net 2,723 2,723 Other assets 1,509 1,335 Total assets $ 79,962 $ 75,964 Liabilities and Shareholders' Equity Current liabilities: Current debt and capital lease obligations $ 5,696 $ 5,167 Accounts payable and cash overdrafts 9,788 7,772 Current accrued claim liabilities 8,195 8,829 Other accrued expenses 7,499 7,525 Total current liabilities 31,178 29,293 Long-term debt and capital lease obligations 22,875 22,401 Long-term accrued claim liabilities 2,800 2,800 Total liabilities 56,853 54,494 Shareholders' equity: Common stock, without par value; 20,000,000 shares authorized; 13,550,638 and 13,548,138 shares issued and outstanding, respectively 16,856 16,851 Retained earnings since January 1, 1991 6,253 4,619 Total shareholders' equity 23,109 21,470 Total liabilities and shareholders' equity $ 79,962 $ 75,964 The accompanying notes are an integral part of these consolidated financial statements.
INTRENET, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations Three and Six Months Ended June 30, 1998 and 1997 (Unaudited) (In Thousands of Dollars, Except Per Share Data)
Three Months Six Months Ended June 30, Ended June 30, 1998 1997 1998 1997 Operating revenues $ 66,351 $ 64,507 $ 127,027 $ 122,170 Operating expenses: Purchased transportation and equipment rents 29,861 27,443 57,098 51,278 Salaries, wages, and benefits 15,767 15,622 30,231 30,102 Fuel and other operating expenses 11,961 12,765 23,160 25,039 Operating taxes and licenses 2,554 2,534 5,068 5,152 Insurance and claims 1,974 2,199 3,945 4,180 Depreciation 977 1,190 1,964 2,368 Other operating expenses 903 933 1,923 1,635 63,997 62,686 123,389 119,754 Operating income 2,354 1,821 3,638 2,416 Interest expense (643) (770) (1,303) (1,512) Other expense, net (105) (105) (210) (210) Earnings before income taxes 1,606 946 2,125 694 Provision for income taxes (360) (232) (491) (232) Net earnings $ 1,246 $ 714 $ 1,634 $ 462 Earnings per common and common equivalent share Basic $ 0.09 $ 0.05 $ 0.12 $ 0.03 Diluted $ 0.09 $ 0.05 $ 0.12 $ 0.03 The accompanying notes are an integral part of these consolidated financial statements.
INTRENET, INC. AND SUBSIDIARIES Condensed Consolidated Statement of Shareholders' Equity For the Six Months Ended June 30, 1998 (Unaudited) (In Thousands of Dollars)
Retained Shareholders' Common Stock Earnings Equity Shares Dollars Balance, December 31, 1997 13,548,138 $ 16,851 $ 4,619 $ 21,470 Exercise of stock options 2,500 5 - 5 Net earnings for 1998 - - 1,634 1,634 Balance, June 30, 1998 13,550,638 $ 16,856 $ 6,253 $ 23,109 The accompanying notes are an integral part of these consolidated financial statements.
INTRENET, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows Three and Six Months Ended June 30, 1998 and 1997 (Unaudited) (In Thousands of Dollars)
Three Months Six Months Ended June 30, Ended June 30, 1998 1997 1998 1997 Cash flows from operating activities: Net earnings $ 1,246 $ 714 $ 1,634 $ 462 Adjustments to reconcile net earnings to net cash provided by operating activities: Deferred income taxes 360 232 491 232 Depreciation and amortization 1,097 1,295 2,204 2,578 Provision for doubtful accounts 74 99 133 226 Changes in assets and liabilities, net: Receivables (3,586) (3,452) (3,592) (6,062) Prepaid expenses 397 738 (1,743) (404) Accounts payable and accrued expenses (155) 1,195 880 2,411 Net cash provided by (used in) operating activities (567) 821 7 (557) Cash flows from financing activities: Net borrowings (repayments) on line of credit, net 2,210 479 2,829 4,928 Principal payments on long-term debt (854) (926) (1,826) (3,118) Proceeds from exercise of stock options 0 15 5 67 Net cash provided by (used in) financing activities 1,356 (432) 1,008 1,877 Cash flows from investing activities: Additions to property and equipment (557) (213) (646) (735) Disposals of property and equipment 19 312 97 815 Net cash provided by (used in) investing activities (538) 99 (549) 80 Net increase in cash and cash equivalents 251 488 466 1,400 Cash and cash equivalents: Beginning of period 813 1,322 598 410 End of period $ 1,064 $ 1,810 $ 1,064 $ 1,810 The accompanying notes are an integral part of these consolidated financial statements.
INTRENET, INC. AND SUBSIDIARIES Notes to Condensed Consolidated Financial Statements June 30, 1998 (Unaudited) (1) Unaudited Consolidated Financial Statements The accompanying unaudited consolidated financial statements include the accounts of Intrenet, Inc. and all of its subsidiaries (collectively, the Company). Operating subsidiaries at June 30, 1998 were Roadrunner Trucking, Inc. (RRT), Eck Miller Transportation Corporation (EMT), Advanced Distribution System, Inc. (ADS), and Roadrunner Distribution Services, Inc. (RDS). Also included is the Company's intermodal broker and logistics manager, INET Logistics, Inc. (INL). All significant intercompany transactions are eliminated in consolidation. Through its subsidiaries, the Company provides general and specialized truckload carrier, brokerage and logistics management services throughout North America. The consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). In management's opinion, these financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the results of operations for the interim periods presented. Pursuant to SEC rules and regulations, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted from these statements unless significant changes have taken place since the end of the most recent fiscal year. For this reason, the accompanying consolidated financial statements and notes thereto should be read in conjunction with the financial statements and notes for the year ended December 31, 1997 included in the Company's 1997 Annual Report on Form 10-K. The results for the three month and six month periods ended June 30, 1998, are not necessarily indicative of the results to be expected for the entire year. (2) Earnings Per Common and Common Equivalent Share Earnings per common and common equivalent share have been computed on the basis of the weighted average common shares outstanding during the periods. The Company has adopted the Financial Accounting Standard Board issue of SFAS No. 128, "Earnings Per Share", and restated its computation of EPS for all prior periods. The adoption of this new standard resulted in an immaterial difference in its computation of basic and diluted EPS. (3) Income Taxes Income taxes in interim periods are generally provided on the basis of the estimated effective tax rate for the year. (4) Contingent Liabilities On June 13, 1997, the Company received notice from the Central States Southeast and Southwest Areas Pension Fund (the "Fund") of a claim pursuant to the Employee Retirement Income Security Act of 1974, as amended by the Multi-employer Pension Plan Amendments Act of 1980 ("MPPAA"). MPPAA provides that, if an employer withdraws from participation in a multi-employer pension plan, such as the Fund, the employer and members of the employer's "controlled group" of businesses are jointly and severally liable for a portion of the plan's underfunding. The claim is based on the withdrawal of R-W Service System, Inc. ("RW") from the Fund in 1992. The Company's records indicate that RW was an indirect subsidiary of the Company's predecessor, Circle Express, Inc., from March 1985 through April 1988, when it and certain other subsidiaries were sold. The Fund currently claims that RW's withdrawal liability is approximately $3.7 million plus accrued interest in the amount of approximately $1.7 million. Based on its investigation to date, and, after consultation with counsel, management believes that the Company is not liable to the Fund for any of RW's withdrawal liability. The Company has filed a formal request for review of the claim as provided by MPPAA, and the Fund rejected that request on January 28, 1998. The Company is in the process of seeking resolution of the claim in binding arbitration. The Company is obligated to make interim payments to the Fund until the issue of liability is resolved. The interim payment obligation is currently approximately $88,500 per month. The Company has made payments to the Fund that total approximately $1,000,000 as of June 30, 1998, which are included in other assets on the Company's balance sheet. There can be no assurance that either the need to make interim payments to the Fund or the ultimate resolution of this matter will not have a material adverse effect on the Company's liquidity, results of operation or financial condition. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Introduction The following discussion should be read in conjunction with the condensed consolidated financial statements and notes thereto appearing elsewhere in this report. Certain statements made in this report relating to trends in the Company's business, as well as other statements including such words as "believe", "expect", "anticipate", and other similar expressions constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For a description of risks and uncertainties relating to forward looking statements, see the discussion in the Company's Annual Report on Form 10-K for the year ended December 31, 1997. The Company reported net earnings of $1,246,000($0.09 per share) on revenues of $66.4 million in the three months and net earnings of $1,634,000 ($0.12 per share) on revenues of $127.0 million in the six months ended June 30, 1998. This compares with net earnings of $714,000 on revenues of $64.5 million, and net earnings of $462,000 on revenues of $122.2 million in the comparable periods of 1997, respectively. The Company's revenue grew by 2.9 percent in the second quarter of 1998 and three of its five subsidiaries (EMT, ADS and INET) reported revenue improvements. During the second quarter of 1998, RDS's operations and administrative offices were combined with RRT in Albuquerque, NM. Consequently, this activity resulted in a slight decrease in revenue production for these companies during the quarter compared to the prior year. On a year to date basis, all of the subsidiaries except RDS reported revenue growth. Fuel prices continued to decline during the second quarter and were lower than the second quarter of the prior year. Barring any unforeseen changes in the overall economy or in the price of fuel, management expects that the Company will benefit from continuing cost reduction programs in the area of safety, fuel purchasing and insurance costs and greater equipment utilization and that an expanded fleet will allow for revenue growth. These trends should enable the Company to remain profitable for the balance of 1998. During the second quarter of 1998, the Company acquired the assets of two companies, Regal Transportation and Ram Trans. Regal Transportation, a flatbed operation located in Niles, OH, with revenues of approximately $5 million, was acquired by EMT. Ram Trans, a flatbed brokerage and logistics company, located in Denver, CO, with revenues of $5 - 6 million per year, was acquired by INET. These acquisitions are projected to add $10 - 11 million in operating revenues. Revenue miles for the second quarter of 1998 decreased to 42.6 million miles from 44.9 million miles as a result of fewer average number of tractors in the fleet. Revenue per mile in the second quarter of 1998 improved by 3.8 percent to $1.37 per mile, up from $1.32 last year, continuing the trend reported in the first quarter. The Company's total operating fleet, including owner-operators, at the end of the second quarter of 1998 was 2,250 tractors, up from 2,231 at the end of the second quarter of 1997, representing an increase of 1 percent. The number of Company owned tractors, at the end of the second quarter, grew by 3 percent, as compared with the second quarter of 1997. A discussion of the impact of the above and other factors on the results of operations in the three months and six months ended June 30, 1998, as compared to the comparable periods of 1997 follows. 1998 Compared to 1997 Three Months Six Months Ended June 30, Ended June 30, Key Operating Statistics 1998 1997 %Change 1998 1997 %Change Operating Revenues ($ millions) $66.4 $64.5 2.9 $127.0 $122.2 3.9 Net Earnings ($000's) $1,246 $714 74.5 $1,634 $462 253.7 Average Number of Tractors 2,249 2,282 (1.5) 2,225 2,275 (2.2) Total Loads (000's) 91.1 79.0 15.3 174.9 147.3 18.7 Revenue Miles (millions) 42.6 44.9 (5.1) 82.6 85.2 (3.1) Average Revenue per Revenue Mile* $1.37 $1.32 3.8 $1.36 $1.32 3.0 * Excluding brokerage revenue Operating Revenues Operating revenues for the three months and six months ended June 30, 1998, totaled $66.4 million and $127.0 million, respectively, as compared to $64.5 million and $122.2 million for the same periods in 1997, reflecting better freight availability than the prior year. Four of the Company's five subsidiaries continued to grow in 1998. Revenue increased by $1.9 million, or 2.9 percent, in the three months, and $4.8 million, or 3.9 percent, in the six months ended June 30, 1998, over the comparable 1997 periods. The average number of Company owned tractors decreased 0.3 percent from 1,208 to 1,205 in the six month period ended June 30, 1998 from the comparable period in 1997, and the average owner-operator tractor count decreased 4.4 percent from 1,067 to 1,020. Approximately 50.9 percent of the Company's revenue was generated by Company-operated equipment, and 37.3 percent by owner-operator equipment in the six months ended June 30, 1998. This compares to 54.3 percent and 37.8 percent, respectively, in the 1997 period. The remaining revenues were from freight brokered to other carriers, ("brokered freight"). The Company experienced a 3.0 percent improvement in the average revenue per revenue mile in the first six months of 1998, as compared to 1997. This is generally the result of a slight tightening of capacity in the markets served by the Company. Operating Expenses The following table sets forth the percentage relationship of operating expenses to operating revenues for the three months and six months ended June 30. Three Months Six Months Ended June 30, Ended June 30, 1998 1997 1998 1997 Operating revenues 100% 100% 100% 100% Operating expenses: Purchased transportation and equipment rents 45.0 42.5 44.9 42.0 Salaries, wages and benefits 23.8 24.2 23.8 24.6 Fuel and other operating expenses 18.0 19.8 18.2 20.5 Operating taxes and licenses 3.8 4.0 4.0 4.2 Insurance and claims 3.0 3.5 3.2 3.5 Depreciation 1.5 1.8 1.5 1.9 Other operating expenses 1.4 1.4 1.5 1.3 Total operating expenses 96.5% 97.2% 97.1% 98.0% Purchased transportation and equipment rents increased as a percentage of revenue due to the increased amount of brokered freight. Likewise, salaries, wages and benefits decreased as a percentage of revenue because of the relatively smaller portion of the Company's total revenue generated by Company operated equipment and the growing portion of the Company's total revenue from owner-operators and from brokered freight. Fuel and other operating expenses are attributable to Company-operated equipment and these expenses declined in relation to growth in the use of owner-operators and brokered freight. Declining diesel fuel prices have also been a significant factor relating to this expense decrease. Other operating expenses increased in 1998 over 1997 due to higher communication cost resulting from pay phone user surcharges and increased professional fees as a result of the MPPAA litigation. Interest Expense Interest expense decreased in 1998, primarily as a result of the decreased borrowings under capital lease obligations as equipment is replaced with operating leases. Interest on bank borrowings were flat in 1998 compared to 1997, due to a slight increase in the borrowing base offset by a reduction in the borrowing rate due to the amended bank agreement in 1998. Provision for Income Taxes Income taxes in interim periods are generally provided on the basis of the estimated effective tax rate for the year. Liquidity and Capital Resources The Company generated $466,000 of cash in the first six months of 1998. As reflected in the accompanying Consolidated Statements of Cash Flows, $7,000 of cash was provided by operating activities, primarily by earnings and depreciation which was offset by increased accounts receivable and cash used to purchase plates and permits for the Company's fleet. Net cash of $1.0 million was generated by financing activities, primarily bank borrowings. Net cash of $549,000 was used in financing activities, primarily additions to property and equipment. The Company's day-to-day financing is provided by borrowings under its bank credit facility. The credit facility consists of a $5 million term loan with a final maturity of December 31, 1999, and a $28 million revolving line of credit which expires January 1, 2000. Quarterly principal payments of $312,500 on the term loan are required. The line of credit includes provisions for the issuance of standby letters of credit which, as issued, reduce available borrowings under the line of credit. Borrowings under the line of credit are limited to amounts determined by a formula tied to the Company's eligible accounts receivable and inventories, as defined in the credit facility. Borrowings under the revolving line of credit totaled $9.4 million at June 30, 1998, and outstanding letters of credit totaled $6.2 million at that date. The combination of these two bank credits totaled $15.6 million, leaving $9.1 million of borrowing capacity available at June 30, 1998. During the first quarter, the Company's bank agreement was amended, resulting in a reduction of the borrowing rate on the Company's credit facility from the bank's prime rate plus one half percent to, at the election of the Company, the prime rate or 250 basis points over the 30 day LIBOR rate. The bank also reduced the rate on the term loan from the prime rate plus one half to, at the election of the Company, one quarter percent plus the prime rate or 275 basis points in excess of the 30, 90, or 120 day LIBOR rate. Among other changes, the bank increased the ratio of adjusted liabilities from 3:1 to 4:1, removed limitations on capital expenditures for tractors and trailers, but added a "Fixed Charge Coverage Ratio" defined by EBITDA plus Historical Operating Lease payments divided by Fixed Charges plus Prospective Operating Lease payments. The Company believes that cash generated from operations, and cash available to it under the bank credit facility will be sufficient to meet the Company's needs for the foreseeable future. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. On June 13, 1997, the Company received notice from the Central States Southeast and Southwest Areas Pension Fund (the "Fund") of a claim pursuant to the Employee Retirement Income Security Act of 1974, as amended by the Multi-employer Pension Plan Amendments Act of 1980 ("MPPAA"). MPPAA provides that, if an employer withdraws from participation in a multi-employer pension plan, such as the Fund, the employer and members of the employer's "controlled group" of businesses are jointly and severally liable for a portion of the plan's underfunding. The claim is based on the withdrawal of R-W Service System, Inc. ("RW") from the Fund in 1992. The Company's records indicate that RW was an indirect subsidiary of the Company's predecessor, Circle Express, Inc., from March 1985 through April 1988, when it and certain other subsidiaries were sold. The Fund currently claims that RW's withdrawal liability is approximately $3.7 million plus accrued interest in the amount of approximately $1.7 million. Based on its investigation to date, and, after consultation with counsel, management believes that the Company is not liable to the Fund for any of RW's withdrawal liability. The Company has filed a formal request for review of the claim as provided by MPPAA, and the Fund rejected that request on January 28, 1998. The Company is in the process of seeking resolution of the claim in binding arbitration. The Company is obligated to make interim payments to the Fund until the issue of liability is resolved. The interim payment obligation is currently approximately $88,500 per month. The Company has made payments to the Fund that total approximately $1,000,000 as of June 30, 1998, which are included in other assets on the Company's balance sheet. There can be no assurance that either the need to make interim payments to the Fund or the ultimate resolution of this matter will not have a material adverse effect on the Company's liquidity, results of operation or financial condition. There are no other material pending legal proceedings to which the Company or any of its subsidiaries is a party or of which any of their property is the subject, other than routine proceedings previously reported in the Company's 1997 Annual Report on Form 10-K, and litigation incidental to its business, primarily involving claims for personal injury and property damage incurred in the transporting of freight. The Company maintains insurance which covers liability resulting from transportation related claims in amounts management believes are prudent and consistent with accepted industry practices, subject to deductibles for the first $100,000 to $250,000 of exposure for each incident. The Company is not aware of any claims or threatened claims that might materially affect the Company's operating or financial results. ITEM 2. CHANGES IN SECURITIES None ITEM 3. DEFAULTS UPON SENIOR SECURITIES None ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The annual meeting of shareholders of the Company was held on May 6, 1998. The following individuals were elected as directors for the ensuing year or until their successors are duly elected and qualified with the following votes cast for or against. There were no abstentions or broker non-votes. For Against John P. Delavan 12,705,979 2,539 Ned N. Fleming III 12,706,279 2,239 Eric C. Jackson 12,706,279 2,239 Edwin H. Morgens 12,706,379 2,139 Thomas J. Noonan, Jr. 12,706,079 2,439 Philip Scaturro 12,706,379 2,139 The shareholders of the Company also ratified the selection of Arthur Andersen LLP as auditors for 1998 with 12,697,800 votes in favor, 4,718 against, and 6,000 abstentions. There were no broker non-votes. ITEM 5. OTHER INFORMATION None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits Exhibit 10.1 - First Amendment to the Employment Agreement dated June 4, 1996, between the Company and John P. Delavan Exhibit 11 - Computation of Per Share Earnings Exhibit 27 - Financial Data Schedule (b) Reports on Form 8-K None 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. INTRENET, INC. (Registrant) /s/ John P. Delavan John P. Delavan, President and Chief Executive Officer August 11, 1998 /s/ Roger T. Burbage Roger T. Burbage, Executive Vice-President and Chief Financial Officer (Principal Financial and Accounting Officer) EX-10.1 2 FIRST AMENDMENT TO EMPLOYMENT AGREEMENT This First Amendment to Employment Agreement ("Amendment") is made and dated as of April 9, 1998, by and between INTRENET, INC., an Indiana corporation ("Employer"), and JOHN DELAVAN ("Employee"), W I T N E S S E T H WHEREAS, Employee is currently serving as the Chief Executive Officer of Employer pursuant to an Employment Agreement dated as of June 4, 1996 (the "Prior Agreement"), WHEREAS, Employee desires to be assured of certain compensation and other benefits for his continued services to Employer. WHEREAS, the parties have agreed to amend the Prior Agreement on the terms and conditions set forth in this amendment. NOW, THEREFORE, in consideration of the premises, the mutual covenants and undertakings contained herein, Employer and Employee agree as follows: 1. The Term of the agreement for Employee's employment as defined in Paragraph 3 of the Prior Agreement shall continue through June 30, 2000. 2. The Base Compensation of the Employee as defined in Paragraph 4 of the Prior Agreement shall be $210,000 per annum, payable at regular intervals in accordance with the Employer's normal payroll practices now or hereafter in effect. 3. Except as set forth in this Amendment, the Prior Agreement shall continue in effect. IN WITNESS WHEREOF, the parties have caused this Amendment to be executed and delivered as of the day and year first set forth above. INTRENET, INC. By /s/ Edwin H. Morgens Edwin H. Morgens, Chairman of the Board, Employer By /s/ John Delavan John Delavan, Employee EX-11 3 INTRENET, INC. STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
Three Months Ended June 30, Six Months Ended June 30, 1998 1997 1998 1997 Weighted average shares outstanding during period 13,550,638 13,450,303 13,549,934 13,444,088 Assumed exercise of options and warrants 457,994 228,456 420,384 185,906 Shares assumed for fully diluted earnings per share 14,008,632 13,678,759 13,970,318 13,629,994 Earnings for the period: ($ in Thousands) Net earnings $ 1,246 $ 714 $ 1,634 $ 462 Earnings per common and common equivalent share: Basic: $ 0.09 $ 0.05 $ 0.12 $ 0.03 Diluted: $ 0.09 $ 0.05 $ 0.12 $ 0.03 Exhibit 11
EX-27 4
5 0000778161 INTRENET,INC. 1,000 U.S. DOLLARS 6-MOS DEC-31-1998 JAN-01-1998 JUN-30-1998 1 1,064 0 35,235 (1,302) 0 41,438 28,803 0 79,962 31,178 22,875 0 0 16,856 6,253 79,962 0 127,027 0 123,389 210 0 1,303 2,125 491 1,634 0 0 0 1,634 .12 .12
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