-----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, JnZ7DWIbVPCd/sPRh7KjBo6NeY7ZFQxhfzShylea52tbNJTo8ziV60xCLdZUgNMh ZIedaObCGXQZHNg/vO1Z1Q== 0000819977-96-000018.txt : 19960510 0000819977-96-000018.hdr.sgml : 19960510 ACCESSION NUMBER: 0000819977-96-000018 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960509 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: EMCON CENTRAL INDEX KEY: 0000819977 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ENGINEERING SERVICES [8711] IRS NUMBER: 941738964 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-16225 FILM NUMBER: 96558575 BUSINESS ADDRESS: STREET 1: 400 S EL CAMINO REAL STE 1200 CITY: SAN MATEO STATE: CA ZIP: 94402 BUSINESS PHONE: 4153751522 MAIL ADDRESS: STREET 1: P O BOX 349014 CITY: SACRAMENTO STATE: CA ZIP: 95834-9014 FORMER COMPANY: FORMER CONFORMED NAME: EMCON ASSOCIATES /CA/ DATE OF NAME CHANGE: 19910611 10-Q 1 FORM 10-Q, 1ST QUARTER 1996 UNITED STATES 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 March 31, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 0-16225 EMCON (Exact name of Registrant as specified in its charter) California 94-1738964 - --------------------------------------- -------------------- (State or other jurisdiction of (I.R.S.Employer incorporation or organization) Identification No.) 400 South El Camino Real, Suite 1200, San Mateo, California 94402 - ---------------------------------------- -------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (415) 375-1522 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 [ ] 8,480,158 shares of Common Stock Issued and Outstanding as of April 30, 1996. 1 EMCON INDEX REPORT ON FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 1996 Page Number FACING SHEET........................................................... 1 TABLE OF CONTENTS...................................................... 2 PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets - March 31, 1996 and December 31, 1995................. 3 Consolidated Statements of Income - Three months ended March 31, 1996 and 1995........... 4 Consolidated Statements of Cash Flows - Three months ended March 31, 1996 and 1995........... 5 Notes to Consolidated Financial Statements........... 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations........ 9 PART II. OTHER INFORMATION........................................... 11 Signatures............................................................. 12 Index to Exhibits...................................................... 13 2
EMCON CONSOLIDATED BALANCE SHEETS - ------------------------------------------------------------------------------- March 31, December 31, 1996 1995 (In thousands, except share amounts) (Unaudited) (Audited) - ------------------------------------------------------------------------------- ASSETS Current Assets: Cash and cash equivalents ..................... $ 5,520 $ 9,451 Marketable securities ......................... -- 501 Accounts receivable, net of allowance for doubtful accounts of $1,120 and $1,052 at March 31, 1996 and December 31, 1995, respectively ............ 39,125 34,925 Prepaid expenses and other current assets ..... 5,293 3,066 -------- -------- Total Current Assets ....................... 49,938 47,943 Net property and equipment, at cost ........... 22,564 16,690 Other assets .................................. 4,107 3,579 Deferred tax assets ........................... 1,823 1,677 Intangible assets, net of amortization ........ 20,527 8,747 -------- -------- Total Assets ............................... $ 98,959 $ 78,636 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable .............................. $ 5,362 $ 4,174 Accrued payroll and related benefits .......... 5,118 4,975 Other accrued liabilities ..................... 5,168 2,109 Non-current obligations due within one year ... 789 372 -------- -------- Total Current Liabilities .................. 16,437 11,630 Non-current obligations ....................... 16,642 1,700 Commitments and contingencies ................. -- -- Shareholders' Equity: Preferred stock, no par value, 5,000,000 shares authorized; no shares issued or outstanding ............................. -- -- Common stock, no par value, 15,000,000 shares authorized; 8,480,158 and 8,329,343 shares issued and outstanding at March 31, 1996 and December 31, 1995, respectively ............................... 41,928 41,401 Retained earnings ............................. 23,952 23,918 Unrealized losses on marketable securities .... -- (13) -------- -------- Total Shareholders' Equity ................. 65,880 65,306 -------- -------- Total Liabilities and Shareholders' Equity.. $ 98,959 $ 78,636 ======== ========
See accompanying notes 3
EMCON CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - ------------------------------------------------------------------------------- Three months ended March 31, ---------------------------- (In thousands, except per share amounts) 1996 1995 - ------------------------------------------------------------------------------- Gross revenue .................................... $ 28,564 $ 30,369 Outside services, at cost ........................ 3,957 4,093 -------- -------- Net revenue ................................... 24,607 26,276 Costs and expenses: Direct expenses ............................... 9,689 9,986 Indirect expenses ............................. 14,799 15,762 -------- -------- Income from operations ..................... 119 528 Interest income (expense), net ................... (22) 59 Equity in loss of affiliates ..................... (44) (20) -------- -------- Income before provision for income taxes ......... 53 567 Provision for income taxes ....................... 19 170 -------- -------- Net income ....................................... $ 34 $ 397 ======== ======== Income per share ................................. $ 0.01 $ 0.05 ======== ========
See accompanying notes 4
EMCON CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - ------------------------------------------------------------------------------------------------------------ Three months ended March 31, ---------------------------- Increase (decrease) in cash and cash equivalents (in thousands) 1996 1995 - ------------------------------------------------------------------------------------------------------------ Cash flow from operating activities: Net income ................................................................. $ 34 $ 397 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation and amortization .......................................... 1,463 1,361 Loss on sale/disposal of property and equipment ........................ 29 29 Increase in salary continuation plan ................................... 11 21 Changes in operating assets and liabilities: Accounts receivable ................................................ (8) 1,059 Prepaid expenses and other current assets .......................... (902) (1,028) Other assets ....................................................... (384) 82 Accounts payable ................................................... (472) (3,564) Accrued payroll and related benefits ............................... (241) (829) Other accrued liabilities .......................................... 272 135 - ----------------------------------------------------------------------------------------------------------- Net cash used for operating activities ..................................... (198) (2,337) - ----------------------------------------------------------------------------------------------------------- Cash flow from investing activities: Additions to property and equipment ........................................ (621) (844) Purchases of available for sale securities ................................. -- (25) Maturities of available for sale securities ................................ 514 499 Acquisitions, net of cash acquired ........................................ (4,007) -- Proceeds from sale of property and equipment ............................... 6 20 - ---------------------------------------------------------------------------------------------------------- Net cash used for investing activities ..................................... (4,108) (350) - ---------------------------------------------------------------------------------------------------------- Cash flow from financing activities: Payment of current and noncurrent obligations .............................. (152) (70) Issuance of common stock for cash .......................................... 527 189 - ---------------------------------------------------------------------------------------------------------- Net cash provided by financing activities .................................. 375 119 - ---------------------------------------------------------------------------------------------------------- Decrease in cash and cash equivalents ......................................... (3,931) (2,568) Cash and cash equivalents, beginning of year .................................. 9,451 5,152 - ---------------------------------------------------------------------------------------------------------- Cash and cash equivalents, end of period ...................................... $ 5,520 $ 2,584 - ----------------------------------------------------------------------------------------------------------
See accompanying notes 5 EMCON NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries after elimination of all significant intercompany accounts and transactions. While the financial information is unaudited, the statements in this report reflect all adjustments, which are normal and recurring, that are necessary for a fair presentation of the results of operations for the interim periods covered and of the financial condition of the Company at the dates of the balance sheets. The operating results for the interim periods presented are not necessarily indicative of performance for the entire year. These financial statements and notes should be read in conjunction with the Company's consolidated financial statements for the fiscal year ended December 31, 1995. 2. Restructuring Charges In December 1994, as a result of changes in senior management, the Company's Board of Directors approved a corporate restructuring plan which included the write off of employment contracts with no current or future value, termination of personnel, and the elimination or abandonment of excess and underperforming assets and facilities. During the quarter ended March 31, 1996, $37,000 of cash charges related to the restructuring were incurred and charged against the established reserve. At March 31, 1996, $115,000 of accrued restructuring costs were included in other accrued liabilities. To-date, $1,049,000 of restructuring charges have been incurred. 3. On February 29, 1996, EMCON acquired all of the outstanding capital stock of Organic Waste Technologies, Inc., ("OWT"), a Cleveland based construction, equipment and operations and maintenance company with significant expertise in solid waste management. The Company purchased OWT for $14,039,000 in cash plus the issuance of convertible notes held by certain senior OWT management in the aggregate principal amount of $1,747,000 and other direct acquisition costs of $77,000. The notes bear interest at the rate of 8% per annum with all principal due and payable in full on March 1, 2001. The notes may be converted into shares of OWT common stock upon an underwritten public offering of OWT's common stock in an amount in excess of $10,000,000. In the event the notes have not been converted into OWT shares, they may instead be converted into shares of EMCON common stock for a period of ninety days after November 30, 2001, at a conversion price of $6.50 per share. The Company is still in the process of performing a final analysis of the value and life of all OWT assets acquired and liabilities assumed. Accordingly, the balance sheet reflects a preliminary allocation of the purchase price which is subject to change. Based on this preliminary allocation, the Company has included intangible assets and goodwill of 6 approximately $11,966,000 resulting from the acquisition of OWT in intangible assets on the balance sheet, which amounts will be amortized over periods not to exceed thirty years. The following summarizes the unaudited pro forma net revenue, net income (loss), and income (loss) per share for the combined company for the three month periods ended March 31, 1996 and 1995 had the acquisition occurred at the beginning of each period presented. (unaudited) Three months ended March 31, ---------------------------------------- (in thousands) 1996 1995 -------------------------------------------------------------------------- Net revenue $27,506 $29,628 Net income (loss) (282) 300 Income (loss) per share $ (0.03) $ 0.04 -------------------------------------------------------------------------- The above proforma results of operations do not purport to reflect the actual results of operations had the Company actually acquired OWT as of the beginning of the period presented. 4. Credit Agreement In conjunction with the acquisition of OWT, the Company entered into a $20,000,000 secured credit agreement with its existing commercial bank, replacing its previous $10,000,000 unsecured line of credit. Under the new agreement, the Company borrowed $10,000,000 on a loan term basis with an interest rate not to exceed the prime rate. Principal is to be amortized over seven years, but with any unpaid amount finally due and payable on June 30, 2001. The remaining $10,000,000 under the credit agreement is available on a line of credit basis for working capital purposes (with up to $5,000,000 available for non-working purposes). The line of credit component of the credit agreement expires on May 31, 1997. 5. Litigation As a professional services firm engaged in environmental-related matters, the Company encounters potential liability, including claims for significant environmental damage in the normal course of business. The Company is party to lawsuits and is aware of potential exposure related to certain claims, but in the opinion of management the resolution of these matters will not have a material adverse effect on the Company's financial position, results of operations or cash flows. 6. Income Per Share Income per share is based on the weighted average number of common and dilutive common equivalent shares outstanding using the modified treasury stock method for the three months ended March 31, 1996 and 1995. 7 7. Other In 1994, the Company converted to a fifty-two/fifty-three week fiscal year which will result in a fifty-three week year in 1996. The Company's year end falls on the Friday closest to the last day of the calendar year. The Company also follows a five-four-four week quarterly cycle. For convenience, the accompanying financial statements have been shown as ending on the last day of the calendar period. 8 EMCON ITEM 2. Management's Discussion and Analysis of Financial Condition and Results Of Operations. RESULTS OF OPERATIONS Net revenues for the first quarter of 1996 totalled $24,607,000, including net revenues of $1,675,000 contributed by OWT following its acquisition on February 29, 1996. Excluding OWT, net revenue for the quarter totalled $22,932,000; a 12.7% decrease compared with $26,276,000 for the first quarter of 1995. The decrease in net revenue was attributable, in part, to particularly difficult weather conditions in the Northeast and Northwest areas; with virtually every office in these areas experiencing the loss of two to three productive days due to inclement weather. The decrease was also attributable to general underperformance of the Company's Consulting and Laboratory Divisions in the Alaska and Washington state markets combined with a decrease due to the recent reductions in work force in the first quarter of 1996. Direct expenses for the first quarter of 1996 totalled $9,689,000, including direct expenses from OWT of $1,145,000. Excluding OWT, direct expenses for the quarter totalled $8,544,000; a 14.4% decrease compared with $9,986,000 for the first quarter of 1995. Excluding OWT, direct expenses as a percent of net revenue decreased to 37.3% in the first quarter of 1996 from 38.0% in the first quarter of 1995. This decrease was primarily due to a reduction in direct materials as a percent of total direct expenses. Direct expenses include compensation for billable hours for technical and professional staff and other project related expenses and direct labor and materials for laboratory testing. Indirect expenses for the first quarter of 1996 totalled $14,799,000, including indirect expenses from OWT of $340,000. Excluding OWT, indirect expenses for the quarter totalled $14,459,000; an 8.3% decrease compared with $15,762,000 in the first quarter of 1995. Indirect expenses include nonbillable hours for professional, technical and administrative staff, and general administrative expenses such as rent, bonuses, benefits, insurance, legal and depreciation. Excluding OWT, indirect expenses as a percent of net revenue increased to 63.1% from 60.0% for the period ending March 31, 1996 and 1995, respectively. The increase was principally due to higher start up costs associated with the expansion of the Company's Operations and Construction Division ("EOC"). This increase was offset in part by certain prior reductions in work force and continued implementation of administrative cost containment measures. Income from operations decreased to $119,000 for the first quarter of 1996 from $528,000 for the quarter ended March 31, 1995. Income from operations in the first quarter of 1995 included approximately $250,000 directly attributable to the sale of proprietary technology. The Company recorded interest expense, net of interest income of $22,000 in the first quarter of 1996 compared to net interest income of $59,000 in the comparable quarter last year. The net decrease was attributable to an increase in the Company's long term indebtedness (including assumption of the outstanding OWT convertible notes and other project/equipment related indebtedness and the $10,000,000 loan undertaken to partially fund the OWT acquisition), and a reduction in the Company's cash available for investment as a result of the OWT acquisition. 9 LIQUIDITY AND CAPITAL RESOURCES During the first quarter of 1996, the Company financed its operations principally from cash and marketable securities on hand, cash generated by operations, and from the return on investment on its cash, cash equivalents and marketable securities. Net cash used by operations during the first quarter of 1996 was $198,000. At March 31, 1996, the Company had cash and cash equivalents of $5,520,000. The Company invested $621,000 for the purchase of property and equipment in the first quarter of 1996, primarily for computers and communication systems and to a lesser extent, for laboratory equipment. In conjunction with the acquisition of OWT, the Company entered into a $20,000,000 secured credit agreement with its existing commercial bank, replacing its previous $10,000,000 unsecured line of credit. Under the new agreement, the Company borrowed $10,000,000 on a term loan basis with interest at a variable rate, generally not to exceed the prime rate. Principal is to be amortized over seven years, but with any unpaid amount finally due and payable on June 30, 2001. The remaining $10,000,000 under the credit agreement is available on a line of credit basis for working capital purposes (with up to $5,000,000 of this amount also being available for non-working capital purposes). The line of credit component of the credit agreement expires on May 31, 1997. The Company believes that cash generated from operations and its available bank line, together with existing cash, will be sufficient to meet the Company's capital needs for at least the next twelve months. 10 EMCON PART II OTHER INFORMATION Items 1. - 4. Not applicable. Item 5. Other Information Item 6. Exhibits and Reports (a) Exhibits - See Index to Exhibits on Page 12 (b) Reports on Form 8-K i) A current Report on Form 8-K dated January 31, 1996, was filed with the Securities and Exchange Commission (the "Commission") announcing the signing of a definitive agreement to acquire OWT. ii) A current Report on Form 8-K dated February 29, 1996 was filed with the Commission on March 15, 1996 announcing completion of the OWT acquisition. iii) A current Report on Form 8-K/A (Amendment No. 1) dated April 15, 1996, was filed with the Commission on April 16, 1996 to amend certain information inadvertently left out of the Form 8-K dated February 29, 1996. 11 EMCON 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. Date: May 8, 1996 EMCON R. Michael Momboisse ------------------------------ R. MICHAEL MOMBOISSE Chief Financial Officer and Vice President - Legal (Duly authorized and principal financial and accounting officer) 12 EMCON INDEX TO EXHIBITS Sequentially Exhibit Numbered Number Page - -------------- ------------ 2.1 Agreement and Plan of Reorganization dated * effective April 1, 1994, among Wehran Envirotech, Inc., Registrant and certain other related parties, incorporated by reference from Exhibit 2.1 of the Current Report on Form 8-K dated May 26, 1994. 2.2 Certificate of Ownership reflecting the * merger of Registrant's wholly-owned subsidiary, Wehran/Emcon Northeast, Inc., into Registrant effective December 20,1994, incorporated by reference from Exhibit 2.2 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1994 (the "1994 10-K"). 2.3 Certificate of Ownership reflecting the * merger of Registrant's wholly-owned subsidiary, Wehran Engineering Corporation, into Registrant effective December 23, 1994, incorporated by reference from Exhibit 2.3 of the 1994 10-K. 2.4 Certificate of Ownership reflecting the * merger of Registrant's wholly-owned subsidiary , EA Associates, into Registrant effective December 31, 1994, incorporated by reference from Exhibit 2.4 of the 1994 10-K. 2.5 Certificate of Ownership reflecting the * merger of Registrant's wholly-owned subsidiaries, EMCON Northwest, Inc., EMCON Southeast, Inc., EMCON Baker-Shiflett, Inc., and Eldredge Engineering Associates, Inc., into Registrant effective December 31, 1994, incorporated by reference from Exhibit 2.5 of the 1994 10-K. 2.6 Stock Purchase Agreement dated January 30, * 1996, among Organic Waste Technologies, Inc. ("OWT"), Registrant and the selling shareholders and option holders of OWT, incorporated by reference from Exhibit 2.1 of the Amendment No. 1 to Form 8-K /A dated April 15, 1996. 3.1 Articles of Incorporation, as amended, * incorporated by reference from Exhibit 3.1 of the Registrant's Registration Statement on Form S-1 (File No. 33-16337) effective September 16, 1987 (the "Form S-1 Registration Statement"). 3.2 Certificate of Amendment of Restated Articles * of Incorporation as filed on May 24, 1988, incorporated by reference from Exhibit 3.2 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1988 (the "1988 10-K"). 3.3 Certificate of Amendment of Restated Articles * of Incorporation as filed on June 4, 1991, incorporated by reference from Exhibit 4.1 of the Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1991 (the "June 1991 10-Q"). 3.4 Bylaws, as amended, incorporated by reference * from Exhibit 4.2 of the June 1991 10-Q. 10.1 Standard Commercial Lease dated August 1, * 1985, between Archer Business Complex and Registrant (the "ABC Lease"), incorporated by reference from Exhibit 10.5 of the Form S-1 Registration Statement. 10.2 Amendment to the ABC Lease between Archer * Business Complex and Registrant dated September 30, 1992, incorporated by reference from Exhibit 10.10 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1992 (the "1992 10-K"). 13 Sequentially Exhibit Numbered Number INDEX TO EXHIBITS (Continued) Page - -------------- ---------------- 10.3 Second and Third Amendment to the ABC Lease * between Archer Business Complex and Registrant dated October 4, 1993 and January 1, 1994, respectively, incorporated by referenced from Exhibit 10.2 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1993 (the "1993 10-K"). 10.4 Standard Commercial Lease dated August 1, * 1986, between the Royal Partnership and Sweet-Edwards & Associates, Inc. (since merged into the Registrant) incorporated by reference from Exhibit 10.9 of the Form S-1 Registration Statement. 10.5 EMCON 1986 Incentive Stock Option Plan and *(1) Amendment, incorporated by reference from Exhibit 10.15 of the Form S-1 Registration Statement. 10.6 Form of Agreement pursuant to Salary *(1) Continuation Plan, incorporated by reference from Exhibit 10.17 of the Form S-1 Registration Statement. 10.7 Schedule identifying Agreements pursuant to #(1) Salary Continuation Plan between Registrant and certain employees, incorporated by reference from Exhibit 10.7 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1995 (the "1995 10-K"). 10.8 Form of Indemnity Agreement between the * Registrant and each of the Registrant's officers and directors, incorporated by reference from Exhibit 10.20 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1988 (the "1988 10-K"). 10.9 EMCON 1988 Stock Option Plan, amended by *(1) shareholder approval on May 25,1994, including form of Nonqualified Stock Option Agreement (Outside Directors), incorporated by reference from Exhibit 10.9 of the Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1994 (the "June 30, 1994 10-Q"). 10.10 EMCON Employee Stock Purchase Plan *(1) incorporated by reference from Exhibit 10.10 of the Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 1995. 10.11 EMCON Restricted Stock Plan incorporated by *(1) reference from Exhibit 10.15 of the Annual Report on Form 10-K for the fiscal year ended December 31, 1990. 10.12 EMCON Deferred Compensation Plan effective *(1) January 1, 1994, incorporated by reference from Exhibit 10.12 of the 1993 10-K. 10.13 Trust Agreement for the EMCON Deferred *(1) Compensation Plan and Salary Continuation Plan Trust dated February 19, 1994, between Registrant and Wells Fargo Bank, N.A. incorporated by reference from Exhibit 10.13 of the 1993 10-K. 10.14 Credit Agreement between The Bank of * California, N.A. and Registrant dated September 20, 1991 with Amendment dated May 31, 1992, incorporated by reference from Exhibits 10.11 and 10.12 of the 1992 10-K. 10.15 Second Amendment to Credit Agreement between * The Bank of California, N.A. and Registrant dated effective May 31, 1993, incorporated by reference from Exhibit 10.13 of Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 1993. 14 Sequentially Exhibit Numbered Number INDEX TO EXHIBITS (Continued) Page - -------------- ------------- 10.16 Third Amendment to Credit Agreement between * The Bank of California, N.A. and Registrant dated effective June 2, 1994, incorporated by reference from Exhibit 10.16 of Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 1993. 10.17 Fourth Amendment to Credit Agreement between * the Bank of California, N.A. and Registrant dated effective May 31, 1995, incorporated by reference from Exhibit 10.17 of the June 30, 1995 10-Q. 10.18 Letter Agreement between H. Lee Fortier and *(1) Registrant dated March 14, 1994, incorporated by reference from Exhibit 10.21 of the September 30, 1994 Form 10-Q. 10.19 Letter Agreement between Thorley D. Briggs *(1) and Registrant dated July 19, 1994, incorporated by reference from Exhibit 10.20 of the 1994 10-K. 10.20 Letter Agreement between James M. Felker and *(1) Registrant dated October 31, 1994, incorporated by reference from Exhibit 10.21 of the 1994 10-K. 10.21 Agreement between Eugene M. Herson and *(1) Registrant dated November 30, 1995, incorporated by reference from Exhibit 10.21 of the 1995 10-K. 10.22 Agreement between R. Michael Momboisse and *(1) Registrant dated November 10, 1995, incorporated by reference from Exhibit 10.22 of the 1995 10-K. 10.23 Credit Agreement between The Bank of * California, N.A. and Registrant dated February 29, 1996, incorporated by reference from Exhibit 10.2 of the Current Report on Form 8-K dated February 29, 1996 (the "February 1996 8-K."). 10.24 Security Agreement between The Bank of * California, N.A. and Registrant dated February 29, 1996, incorporated by reference from Exhibit 10.3 of the February 1996 8-K. 10.25 Pledge Agreement between The Bank of * California, N.A. and Registrant dated February 29, 1996, incorporated by reference from Exhibit 10.4 of the February 1996 8-K. 10.26 Eurodollar Rate Option Agreement between The * Bank of California, N.A. and Registrant dated February 29, 1996, incorporated by reference from Exhibit 10.5 of the February 1996 8-K. 10.27 Fixed Rate Amortization Option Agreement * between The Bank of California, N.A. and Registrant dated February 29, 1996, incorporated by reference from Exhibit 10.6 of the February 1996 8-K. 10.28 Note Agreement among the Registrant, OWT, * Mark H. Shipps, and certain employees of OWT , incorporated by reference from Exhibit 10.1 of the February 1996 8-K. 11.1 Computation of Income Per Share, incorporated as part of this submission as document type EX-11.1. * Incorporated by reference (1) Management contract or compensatory plan or arrangement required to be filed as an exhibit to this form pursuant to Item 14(c) of the instructions to Form 10-K. 15 EX-11.1 2 COMPUTATION OF INCOME PER SHARE EXHIBIT 11.1
EMCON COMPUTATION OF INCOME PER SHARE (In thousands except per share data) Three months ended March 31, 1996 1995 ---- ---- Net income ............................................... $ 34 $ 397 Proforma interest income related to modified treasury stock method .............................. 48 63 ------ ------ Adjusted net income ...................................... $ 82 $ 460 ====== ====== Weighted average number of common shares outstanding during the period ......................... 8,457 8,225 Common equivalent shares from outstanding stock options using the modified treasury stock method ....................................... 959 672 Incremental shares to reflect full dilution (1) ....... 0 0 ------ ------ Total shares for purposes of calculating diluted income per share (1) .................................. 9,416 8,897 ====== ====== Primary income per share ................................. $ 0.01 $ 0.05 ====== ====== Fully diluted income per share ........................... $ 0.01 $ 0.05 ====== ======
- ----------------------- (1) This calculation is submitted in accordance with Regulation S-K Item 601(b)(11) although not required by footnote 2 to paragraph 14 to APB opinion No. 15, because it results in dilution of less than 3%. 16 EX-27 3 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the consolidated balance sheets, consolidated statements of income and consolidated statements of cash flows included in the Company's Form 10-Q for the three month period ended March 31, 1996, and is qualified in its entirety by reference to such financial statements and the notes thereto. U.S. DOLLARS 3-MOS DEC-31-1996 JAN-1-1996 MAR-31-1996 1 5,520,000 0 40,245,000 1,120,000 0 49,938,000 47,034,000 24,470,000 98,959,000 16,437,000 0 0 0 41,928,000 0 98,959,000 24,607,000 24,607,000 9,689,000 9,689,000 14,429,000 321,000 115,000 53,000 19,000 34,000 0 0 0 34,000 0.01 0.01 -----END PRIVACY-ENHANCED MESSAGE-----