0000085608-95-000018.txt : 19950824
0000085608-95-000018.hdr.sgml : 19950824
ACCESSION NUMBER: 0000085608-95-000018
CONFORMED SUBMISSION TYPE: 10-Q
PUBLIC DOCUMENT COUNT: 4
CONFORMED PERIOD OF REPORT: 19950702
FILED AS OF DATE: 19950814
SROS: AMEX
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: MATEC CORP/DE/
CENTRAL INDEX KEY: 0000085608
STANDARD INDUSTRIAL CLASSIFICATION: 3310
IRS NUMBER: 060737363
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 10-Q
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-04184
FILM NUMBER: 95562641
BUSINESS ADDRESS:
STREET 1: 75 SOUTH ST
CITY: HOPKINTON
STATE: MA
ZIP: 01748
BUSINESS PHONE: 5084359039
MAIL ADDRESS:
STREET 1: 75 SOUTH STREET
CITY: HOPKINTON
STATE: MA
ZIP: 01748
FORMER COMPANY:
FORMER CONFORMED NAME: RSC INDUSTRIES INC
DATE OF NAME CHANGE: 19840515
FORMER COMPANY:
FORMER CONFORMED NAME: REEVES INDUSTRIES INC
DATE OF NAME CHANGE: 19710520
10-Q
1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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 July 2, 1995
------------------------------------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
------------- --------------
Commission File Number 1-4184
--------------------------------------------------
MATEC Corporation
-------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 06-0737363
------------------------------- ----------------------
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification Number)
75 South Street, Hopkinton, Massachusetts 01748
----------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(508) 435-9039
----------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the 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
--- ---
As of August 10, 1995, the number of shares outstanding of Registrant's
Common Stock, par value $.05 was 2,764,540.
-1-
MATEC Corporation
Index
Page
----
PART I. FINANCIAL INFORMATION
Consolidated Condensed Balance Sheets -
July 2, 1995 and December 31, 1994 ...................... 3
Consolidated Statements of Operations - Three Months
and Six Months Ended July 2, 1995 and July 3, 1994 ...... 4
Consolidated Condensed Statements of Cash Flows -
Six Months Ended July 2, 1995 and July 3, 1994 .......... 5
Notes to Consolidated Condensed Financial Statements ..... 6-7
Management's Discussion and Analysis of Financial
Condition and Results of Operations ..................... 8-10
PART II. OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K ................ 11
Signatures ..................................................... 12
-2-
PART I - FINANCIAL INFORMATION
MATEC Corporation and Subsidiaries
Consolidated Condensed Balance Sheets
(In thousands, except share data) (Unaudited)
July 2, December 31,
1995 1994
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents ................. $ 474 $ 544
Receivables, net .......................... 4,669 4,852
Inventories ............................... 6,429 5,629
Deferred income taxes and
other current assets ..................... 1,179 1,145
------- -------
Total current assets .................... 12,751 12,170
------- -------
Property, plant and equipment, at cost ...... 18,311 17,474
Less accumulated depreciation ............. 11,536 10,887
------- -------
6,775 6,587
Marketable equity securities ................ 1,811 1,552
Other assets ................................ 142 139
------- -------
$21,479 $20,448
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable ............................. $ 915 $ 915
Current portion of long-term debt ......... 228 223
Accounts payable .......................... 2,154 3,152
Accrued liabilities ....................... 1,374 1,375
Income taxes .............................. 285 326
------- -------
Total current liabilities ............... 4,956 5,991
------- -------
Deferred income taxes ....................... 1,227 1,124
Long-term debt .............................. 2,178 428
Stockholders' equity:
Preferred stock, $1.00 par value-
Authorized 1,000,000 shares; issued none . - -
Common stock, $.05 par value-
Authorized 10,000,000 shares;
Issued 3,793,695 shares .................. 190 190
Capital surplus ........................... 6,397 6,374
Retained earnings ......................... 10,761 10,727
Net unrealized gain on marketable
equity securities ........................ 988 832
Treasury stock at cost,
1,029,155 and 1,029,145 shares ........... (5,218) (5,218)
------- -------
Total stockholders' equity .............. 13,118 12,905
------- -------
$21,479 $20,448
======= =======
See notes to consolidated condensed financial statements.
-3-
MATEC Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
7/2/95 7/3/94 7/2/95 7/3/94
------- ------- ------- -------
Net sales ................... $ 7,026 $ 5,817 $13,345 $11,503
Cost of sales ............... 4,897 4,044 9,398 8,140
------- ------- ------- -------
Gross profit .............. 2,129 1,773 3,947 3,363
Operating expenses:
Selling and administrative 1,857 1,664 3,456 3,252
Research and development .. 119 252 231 491
------- ------- ------- -------
1,976 1,916 3,687 3,743
Operating profit (loss) ..... 153 (143) 260 (380)
Other income (expense), net . (106) (3) (204) (19)
------- ------- ------- -------
Earnings (loss) before
income taxes ............... 47 (146) 56 (399)
Income (taxes) credit ....... (19) 43 (22) 129
------- ------- ------- -------
Net earnings (loss) ......... $ 28 $ (103) $ 34 $ (270)
======= ======= ======= =======
Earnings (loss) per share ... $ .01 $ (.04) $ .01 $ (.10)
===== ====== ===== ======
Average shares outstanding .. 2,765 2,765 2,765 2,765
===== ===== ===== =====
Cash dividends per share .... $ - $ - $ - $ -
===== ===== ===== =====
See notes to consolidated condensed financial statements.
-4-
MATEC Corporation and Subsidiaries
Consolidated Condensed Statements of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended
7/2/95 7/3/94
-------- --------
Cash flows from operating activities:
Net earnings (loss) .............................. $ 34 $ (270)
Adjustments to reconcile net earnings (loss) to
net cash (used) by operating activities:
Non-cash items ................................. 659 479
Changes in operating assets and liabilities .... (1,941) (467)
------- --------
Net cash (used) by operating activities (1,248) (258)
-----------------------------------------------------------------------
Cash flows from investing activities:
Capital expenditures, net ........................ (827) (1,110)
Purchase of marketable equity securities ......... - (150)
Collection of amount due from sale of
discontinued operations ......................... 250 155
Other, net........................................ (22) (2)
------- --------
Net cash (used) by investing activities (599) (1,107)
-----------------------------------------------------------------------
Cash flows from financing activities:
Proceeds from issuance of long-term debt
and warrants .................................... 2,000 -
Payments on long-term debt ....................... (223) (209)
------- --------
Net cash provided (used) by financing activities 1,777 (209)
Net (decrease) in cash and cash equivalents ....... (70) (1,574)
Cash and cash equivalents:
Beginning of period .............................. 544 2,222
------- -------
End of period .................................... $ 474 $ 648
======= =======
See notes to consolidated condensed financial statements.
-5-
MATEC Corporation and Subsidiaries
Notes to Consolidated Condensed Financial Statements
1. Financial Presentation:
The interim financial statements are unaudited but, in the opinion of
management, reflect all adjustments necessary for fair presentation of
results for such periods. The results of operations for any interim
period are not necessarily indicative of results for the full year.
The accounting policies followed by the Company are set forth
in Note 1 to the Company's financial statements in the 1994 MATEC
Corporation and Subsidiaries Annual Report which is incorporated by
reference in Form 10-K for the year ended December 31, 1994.
2. Inventories:
Inventories consist of the following (in thousands):
7/2/95 12/31/94
------- --------
Raw materials ....................... $ 3,321 $ 3,007
Work in process ..................... 836 698
Finished goods ...................... 2,272 1,924
------- -------
$ 6,429 $ 5,629
======= =======
Inventories of $2,970,000 in 1995 and $2,752,000 in 1994 are
determined by the LIFO method.
3. Receivables, net:
Receivables, net of allowances, consist of the following (in
thousands):
7/2/95 12/31/94
------- --------
Accounts receivable, less allowance for
doubtful accounts of $218,000 and $199,000 $4,669 $4,602
Amount due on the sale
of Alloy Surfaces Co., Inc. .............. - 250
------ ------
$4,669 $4,852
====== ======
4. Income Taxes:
The Company's estimated effective tax rate for 1995 is 39% compared
to 32% in 1994. The lower rate in 1994 is primarily due to the limited
state tax benefit of losses.
-6-
4. Long-Term Debt:
Long-term debt consists of the following:
7/2/95 12/31/94
-------- --------
10% Term Debt, $2 million face amount,
due in 2000; interest payable quarterly $ 1,978 $ -
Industrial Revenue Bonds:
Principal payments of $180,000 in 1996 and
$200,000 in 1997; interest payable semi-
annually at a rate of 7.0% 380 555
Semi-annual principal payments of $24,167
through 1996; interest payable semi-annually
at a rate of 65% of the trustee's prime rate 48 96
------- -------
2,406 651
Less current portion 228 223
------- -------
$ 2,178 $ 428
======= =======
The Term Debt Note is secured by all the Company's assets, except for
real estate, marketable equity securities, and certain specific equipment
with a total book value of $278,000. The Term Debt Agreement includes
covenants covering debt to equity and interest expense ratios and
restrictions as to the amount of total debt, dividends, and capital stock
repurchases. Under the Agreement, the lender will subordinate its
security interest for up to $4 million in debt, with corresponding
increases in interest rates based on the subordination amounts. As part
of the Agreement, the Company issued the lender transferable common stock
warrants to purchase 85,000 shares of the Company's common stock at $4.75
per share. The warrants expire on June 30, 2000.
The Industrial Revenue Bonds are secured by certain assets with
carrying values of $3,018,000.
-7-
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Financial Condition
-------------------
Cash and cash equivalents decreased $70,000 during the six months
ended July 2, 1995 and the Company received $2 million from the issuance
of term debt. The main uses of the cash were operations ($1,248,000) and
capital expenditures ($827,000). A decrease in accounts payable of
$998,000 and an increase in inventory of $800,000, partially offset by
$659,000 of depreciation expense, were the main reasons for the use of
cash by operations. Overall inventory increased 14% with all segments
reporting higher levels in order to support the increased levels of
current and projected future business.
The Company spent $827,000 on capital expenditures during the six
months ended July 2, 1995. Machinery and equipment additions in the
steel cable segment accounted for the majority of these expenditures.
These additions are geared toward adding new and upgrading existing
production capabilities and processes within this segment.
Management believes that based on its current working capital, the
expected cash flows from operations, and its $1 million line of credit,
the Company's present resources are sufficient to meet its financial
needs in 1995 including a remaining capital expenditures budget of
$873,000. However, management continues to investigate the possibility
of increasing its line of credit facility in order to give the Company
additional flexibility as its businesses grow.
Results of Operations
---------------------
Net sales for the quarter and six months ended July 2, 1995 increased
$1,209,000 (21%) and $1,842,000 (16%), respectively, over the comparable
periods in 1994. The following table presents by segment the amounts and
percentages of sales increase from the corresponding prior year periods.
Quarter Ended Six Months Ended
7/2/95 7/2/95
--------------- ----------------
Segment (000's) % (000's) %
----------------------- ------- --- ------- ---
Electronics ........... $ 795 42 $ 1,436 37
Instruments ........... 585 42 751 29
Steel cable ........... (171) (7) (345) (7)
------- -------
Total ............. $ 1,209 21 $ 1,842 16
======= =======
Electronics
-----------
All product lines reported significant sales increases over both 1994
periods. The majority of the sales increases were attributable to higher
sales to both OEM and contract manufacturers in the telecommunications
market and to the distributor markets.
-8-
Instruments
-----------
During both periods, higher sales to the non-destructive
testing/evaluation ("NDT/NDE") markets accounted for the majority of the
net sales increases over last year. Current year sales to the colloidal
market remained relatively flat with the 1994 periods, while sales to the
medical research markets declined slightly from 1994 levels during both
periods.
The sales increases to the NDT/NDE markets were attributable to
higher sales of its custom test systems. The sales declines to the
medical research market resulted from lower foreign sales, partially
offset by higher domestic sales.
Steel Cable
-----------
During both periods, overall sales to most markets remained level
with or increased slightly over the 1994 periods. The net sales declines
in both periods were mainly attributable to lower sales of assembly
products to the fitness equipment market.
Gross Profit
------------
During the quarter and six months ended July 2, 1995, total gross
profit increased 20% and 17%, respectively, over the comparable 1994
periods. During both periods, the overall gross profit percentage
remained level with the prior year. The electronics segment reported
increases in its gross profit percentages during both these periods,
offset by lower margins in both the instruments and steel cable segments.
In the electronics segment, the increases in the gross profit
percentages over 1994 (47% for the quarter and 26% for the six months)
were mainly due to the favorable effects of allocating the fixed overhead
expenses over the increased sales levels, increased sales of internally
manufactured products which produce a higher margin than that from the
resale of imported products, and product yield improvements.
The overall gross margin rate in the instrument segment declined 19%
and 13% from that in 1994 during the quarter and the six months ended
periods, respectively. Changes in the product mix of sales, higher
occupancy costs due to increased space requirements of the segment, and
increased personnel costs caused by additional employees were the main
factors contributing to the lower overall margins.
In the steel cable segment, the current year gross profit percentage
decreased 27% and 13% from 1994 during the quarter and the six months
ended periods, respectively. During both periods, the lower margins were
primarily due to the start-up expenses and the operating inefficiencies
associated with several new programs scheduled for second and third
quarter production, increased depreciation expense, and the effect of the
fixed operating costs over the lower sales volume.
-9-
Operating Expenses
------------------
During the quarter and six months ended July 2, 1995, selling and
administrative expenses increased $193,000 (12%) and $204,000 (6%),
respectively, over the 1994 comparable periods. Higher selling expenses
accounted for the increase during both periods. Increased sales
commission expense in the electronics and instrument segments and
increased personnel expenses due to additional employees in all segments
were the major items causing the higher selling expenses.
During the quarter and six months ended July 2, 1995, research and
development expenses decreased $133,000 and $260,000, respectively, from
the corresponding periods in 1994. These expense decreases are due to
lower expenses as product and process development projects in both the
instruments and electronics segments were completed in 1994.
Other Income (Expense), net
---------------------------
Other income (expense), net includes the following items:
Quarter Ended Six Months Ended
7/2/95 7/3/94 7/2/95 7/3/94
------ ------ ------ ------
(in thousands)
Interest expense ........... $ (91) $ (1) $ (173) $ (2)
Real estate operations ..... (25) (14) (48) (37)
Interest income ............ 8 6 13 15
Other, net ................. 2 6 4 5
------ ------ ------ ------
$ (106) $ (3) $ (204) $ (19)
====== ====== ====== ======
The increases in interest expense are attributable to the higher
levels of outstanding debt during 1995. The increased losses in the real
estate operations are mainly attributable to lower levels of rental
income.
The Company reported operating profits of $153,000 and $260,000
during the quarter and six months ended July 2, 1995, respectively,
versus losses of $143,000 and $380,000, respectively, in the comparable
1994 periods. Non-operating expenses increased $103,000 and $185,000
over the corresponding 1994 periods, respectively, mainly as a result of
increased interest expense. As a result, the Company reported a pre-tax
profit of $47,000 for the quarter ended July 2, 1995 versus a pre-tax
loss of $146,000 for the 1994 period. For the six months ended July 2,
1995, the Company reported a pre-tax profit of $56,000 versus a $399,000
pre-tax loss in 1994. The improvements in the 1995 operating performance
are mainly due to the higher sales level, the increased gross margin, and
the decrease in operating expenses. The Company expects to see
continuing improvements in operating performance during 1995 based on the
projected sales increases resulting from both the Company's sales of new
products developed in recent years and in sales, product promotion and
customer service geared to increasing market share.
-10-
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
4. Each instrument which defines the rights of holders of
long-term debt of Registrant and its subsidiaries under
which the amount authorized does not exceed 10% of
total assets of Registrant and subsidiaries on a
consolidated basis has not been filed as an exhibit to
this Form 10-Q. Registrant hereby undertakes and
agrees to furnish a copy of each instrument to the
Securities and Exchange Commission upon request.
4.(a) Common Stock Purchase Warrant dated April 12, 1995
between the Registrant and Massachusetts Capital
Resource Company. Filed herein, beginning on page 15.
11. Statement re Computation of Per Share Earnings. Filed
herein, beginning on page 28.
27. Financial Data Schedule. Filed for electronic purposes
only.
(b) Reports on Form 8-K - None
-11-
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.
MATEC Corporation
---------------------------------
Date: August 11, 1995 By /s/ Robert B. Gill
------------------------------
Robert B. Gill,
President and Chief Executive
Officer
Date: August 11, 1995 By /s/ Michael J. Kroll
------------------------------
Michael J. Kroll,
Vice President and Treasurer
-12-
EX-4
2
EXHIBIT 4.(A) COMMON STOCK PURCHASE WARRANT
Exhibit 4.(A)
-------------
The securities represented hereby have not been registered under the
Securities Act of 1933, as amended. These securities have been acquired
for investment and not with a view to distribution or resale, and may not
be transferred or disposed of unless (1) a registration statement under
the Securities Act of 1933, as amended, is then in effect with respect
thereto and such sale is made pursuant to such registration statement or
(2) a written opinion from counsel reasonably satisfactory to the Company
is obtained to the effect that such transfer or disposition will not
violate the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
Right to Purchase 85,000 Shares of
Common Stock of Matec Corporation
No. W-1
MATEC CORPORATION
Common Stock Purchase Warrant
Matec Corporation, a Delaware corporation (the "Company"), hereby
certifies that, for value received Massachusetts Capital Resource Company,
or assigns, is entitled, subject to the terms set forth below, to purchase
from the Company at any time or from time to time before 5:00 P.M., Boston
time, on June 30, 2000, or such later time as may be specified in Section
17 hereof, 85,000 fully paid and nonassessable shares of Common Stock,
$.05 par value, of the Company, at a purchase price per share of $4.75
(such purchase price per share as adjusted from time to time as herein
provided is referred to herein as the "Purchase Price"). The number and
character of such shares of Common Stock and the Purchase Price are
subject to adjustment as provided herein.
This Warrant is one of the Common Stock Purchase Warrants (the
"Warrants") evidencing the right to purchase shares of Common Stock of the
Company, issued pursuant to a certain Secured Note and Warrant Purchase
Agreement (the "Agreement"), dated as of April 12, 1995, among the
Company, Bergen Cable Technologies, Inc., Matec Applied Sciences, Inc.,
Matec Instruments, Inc., Valpey-Fisher Corporation and Massachusetts
Capital Resource Company, a copy of which is on file at the principal
office of the Company and the holder of this Warrant shall be entitled to
all of the benefits of the Agreement, as provided therein.
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Company" shall include Matec Corporation and any
corporation which shall succeed or assume the obligations of the Company
hereunder.
(b) The term "Common Stock" includes the Company's Common
Stock, $.05 par value per share, as authorized on the date of the
Agreement and any other securities into which or for which any of such
Common Stock may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.
(c) The term "Other Securities" refers to any stock (other
than Common Stock) and other securities of the Company or any other person
(corporate or otherwise) which the holders of the Warrants at any time
shall be entitled to receive, or shall have received, on the exercise of
the Warrants, in lieu of or in addition to Common Stock, or which at any
time shall be issuable or shall have been issued in exchange for or in
replacement of Common Stock or Other Securities pursuant to section 5 or
otherwise.
1. EXERCISE OF WARRANT.
1.1. FULL EXERCISE. This Warrant may be exercised in full by
the holder hereof by surrender of this Warrant, with the form of
subscription at the end hereof duly executed by such holder, to the
Company at its principal office, accompanied by payment, in cash or by
certified or official bank check payable to the order of the Company, in
the amount obtained by multiplying the number of shares of Common Stock
for which this Warrant is then exercisable by the Purchase Price then in
effect.
1.2. PARTIAL EXERCISE. This Warrant may be exercised in part
by surrender of this Warrant in the manner and at the place provided in
subsection 1.1 except that the amount payable by the holder on such
partial exercise shall be the amount obtained by multiplying (a) the
number of shares of Common Stock designated by the holder in the
subscription at the end hereof by (b) the Purchase Price then in effect.
On any such partial exercise the Company at its expense will forthwith
issue and deliver to or upon the order of the holder hereof a new Warrant
or Warrants of like tenor, in the name of the holder hereof or as such
holder (upon payment by such holder of any applicable transfer taxes) may
request, calling in the aggregate on the face or faces thereof for the
number of shares of Common Stock for which such Warrant or Warrants may
still be exercised.
1.3. PAYMENT BY NOTES SURRENDER. Notwithstanding the payment
provisions of subsections 1.1 and 1.2, all or part of the payment due upon
exercise of this Warrant in full or in part may be made by the surrender
by such holder to the Company of any of the Company's Notes issued
pursuant to the Agreement and such Notes so surrendered shall be credited
against such payment in an amount equal to the principal amount thereof
plus premium (if any) and accrued interest to the date of surrender.
1.4 NET ISSUE ELECTION. The holder hereof may elect to
receive, without the payment by such holder of any additional
consideration, shares equal to the value of this Warrant or any portion
hereof by the surrender of this Warrant or such portion to the Company,
with the form of subscription at the end hereof duly executed by such
holder, at the office of the Company. Thereupon, the Company shall issue
to such holder such number of fully paid and
-2-
nonassessable shares of Common Stock as is computed using the following
formula:
X = Y (A-B)
--------
A
where X = the number of shares to be issued to such holder pursuant to
this subsection 1.4.
Y = the number of shares covered by this Warrant in respect of which
the net issue election is made pursuant to this subsection 1.4.
A = the fair market value of one share of Common Stock, as
determined in good faith by the Board of Directors of the Company, as at
the time the net issue election is made pursuant to this subsection 1.4.
B = the Purchase Price in effect under this Warrant at the time the
net issue election is made pursuant to this subsection 1.4.
The Board of Directors of the Company shall promptly respond in writing to
an inquiry by the holder hereof as to the fair market value of one share
of Common Stock. Except as is otherwise provided for in the last sentence
of section 17, the provisions of this subsection 1.4 shall not apply to
the extent that the Purchase Price of this Warrant to be so paid under
this subsection 1.4 could be paid by the application of the then
outstanding Notes as provided in subsection 1.3.
1.5. COMPANY ACKNOWLEDGMENT. The Company will, at the time of
any partial exercise of the Warrant, upon the request of the holder hereof
acknowledge in writing its continuing obligation to afford to such holder
any rights to which such holder shall continue to be entitled after such
exercise in accordance with the provisions of this Warrant. If the holder
shall fail to make any such request, such failure shall not affect the
continuing obligation of the Company to afford to such holder any such
rights.
1.6. TRUSTEE FOR WARRANT HOLDERS. In the event that a bank or
trust company shall have been appointed as trustee for the holders of the
Warrants pursuant to subsection 4.2, such bank or trust company shall have
all the powers and duties of a warrant agent appointed pursuant to section
12 and shall accept, in its own name for the account of the Company or
such successor person as may be entitled thereto, all amounts otherwise
payable to the Company or such successor, as the case may be, on exercise
of this Warrant pursuant to this section 1.
1.7. SECURITIES ACT. Upon exercise of this Warrant, the holder
understands and agrees that, until the shares of Common Stock to be issued
upon such exercise shall have been registered under the Securities Act of
1933, as amended, or publicly sold pursuant to an exemption therefrom,
each certificate representing such shares will bear the following legend
or one substantially similar thereto:
-3-
The securities represented hereby have not been
registered under the Securities Act of 1933, as amended.
These securities have been acquired for investment and
not with a view to distribution or resale, and may not be
transferred or disposed of unless (1) a registration
statement under the Securities Act of 1933, as amended,
is then in effect with respect thereto and such sale is
made pursuant to such registration statement or (2) a
written opinion from counsel reasonably satisfactory to
the Company is obtained to the effect that such transfer
or disposition will not violate the Securities Act of
1933, as amended, and the rules and regulations
promulgated thereunder.
2. DELIVERY OF STOCK CERTIFICATES, ETC., ON EXERCISE. As soon as
practicable after the exercise of this Warrant in full or in part, and in
any event within ten (10) days thereafter, the Company at its expense
(including the payment by it of any applicable issue taxes) will cause to
be issued in the name of and delivered to the holder hereof, or as such
holder (upon payment by such holder of any applicable transfer taxes) may
direct, a certificate or certificates for the number of fully paid and
nonassessable shares of Common Stock (or Other Securities) to which such
holder shall be entitled on such exercise, plus, in lieu of any fractional
share to which such holder would otherwise be entitled, cash equal to such
fraction multiplied by the then current market value of one full share,
together with any other stock or other securities and property (including
cash, where applicable) to which such holder is entitled upon such
exercise pursuant to section 1 or otherwise.
3. ADJUSTMENT FOR DIVIDENDS IN OTHER STOCK, PROPERTY, ETC.;
RECLASSIFICATION, ETC. In case at any time or from time to time, the
holders of Common Stock (or Other Securities) shall have received, or (on
or after the record date fixed for the determination of shareholders
eligible to receive) shall have become entitled to receive, without
payment therefor,
(a) other or additional stock or other securities or property
(other than cash) by way of dividend, or
(b) any cash (excluding cash dividends payable solely out of
earnings or earned surplus of the Company), or
(c) other or additional stock or other securities or property
(including cash) by way of spin-off, split-up, reclassification,
recapitalization, combination of shares or similar corporate
rearrangement,
other than additional shares of Common Stock (or Other Securities) issued
as a stock dividend or in a stock-split (adjustments in respect of which
are provided for in subsection 5.4), then and in each such case the holder
of this Warrant, on the exercise hereof as provided in section 1, shall be
entitled to receive the amount of stock and other securities and property
(including cash in the cases referred to in subdivisions (b) and (c) of
this section 3) which such holder would hold on the date of such exercise
if on the date hereof
-4-
he had been the holder of record of the number of shares of Common Stock
called for on the face of this Warrant and had thereafter, during the
period from the date hereof to and including the date of such exercise,
retained such shares and all such other or additional stock and other
securities and property (including cash in the cases referred to in
subdivisions (b) and (c) of this section 3) receivable by him as aforesaid
during such period, giving effect to all adjustments called for during such
period by sections 4 and 5.
4. ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
4.1. In case at any time or from time to time, the Company
shall (a) effect a reorganization, (b) consolidate with or merge into any
other person, or (c) transfer all or substantially all of its properties
or assets to any other person under any plan or arrangement contemplating
the dissolution of the Company, then, in each such case, the holder of
this Warrant, on the exercise hereof as provided in section 1 at any time
after the consummation of such reorganization, consolidation or merger or
the effective date of such dissolution, as the case may be, shall receive,
in lieu of the Common Stock (or Other Securities) issuable on such
exercise prior to such consummation or such effective date, the stock and
other securities and property (including cash) to which such holder would
have been entitled upon such consummation or in connection with such
dissolution, as the case may be, if such holder had so exercised this
Warrant, immediately prior thereto, all subject to further adjustment
thereafter as provided in sections 3 and 5.
4.2. DISSOLUTION. In the event of any dissolution of the
Company following the transfer of all or substantially all of its
properties or assets, the Company, prior to such dissolution, shall at its
expense deliver or cause to be delivered the stock and other securities
and property (including cash, where applicable) receivable by the holders
of the Warrants after the effective date of such dissolution pursuant to
this section 4 to a bank or trust company having its principal office in
Boston, Massachusetts, as trustee for the holder or holders of the
Warrants.
4.3. CONTINUATION OF TERMS. Upon any reorganization,
consolidation, merger or transfer (and any dissolution following any
transfer) referred to in this section 4, this Warrant shall continue in
full force and effect and the terms hereof shall be applicable to the
shares of stock and other securities and property receivable on the
exercise of this Warrant after the consummation of such reorganization,
consolidation or merger or the effective date of dissolution following any
such transfer, as the case may be, and shall be binding upon the issuer of
any such stock or other securities, including, in the case of any such
transfer, the person acquiring all or substantially all of the properties
or assets of the Company, whether or not such person shall have expressly
assumed the terms of this Warrant as provided in section 6.
-5-
5. ADJUSTMENT FOR ISSUE OR SALE OF COMMON STOCK AT LESS THAN THE
PURCHASE PRICE IN EFFECT.
5.1. GENERAL. If the Company shall at any time or from time to
time, issue any additional shares of Common Stock (other than shares of
Common Stock excepted from the provisions of this section 5 by subsections
5.4 and 5.5) without consideration or for a net consideration per share
less than the Purchase Price in effect immediately prior to such issuance,
then, and in each such case: (a) the Purchase Price shall be lowered to
an amount determined by multiplying such Purchase Price then in effect by
a fraction:
(1) the numerator of which shall be (a) the number of
shares of Common Stock outstanding immediately prior to the issuance
of such additional shares of Common Stock, plus (b) the number of
shares of Common Stock which the net aggregate consideration, if any,
received by the Company for the total number of such additional
shares of Common Stock so issued would purchase at the Purchase Price
in effect immediately prior to such issuance, and
(2) the denominator of which shall be (a) the number of
shares of Common stock outstanding immediately prior to the issuance
of such additional shares of Common Stock plus (b) the number of such
additional shares of Common Stock so issued;
and (b) the holder of this Warrant shall thereafter, on the exercise
hereof as provided in section 1, be entitled to receive the number of
shares of Common stock determined by multiplying the number of shares of
Common Stock which would otherwise (but for the provisions of this
subsection 5.1) be issuable on such exercise by the fraction of which (i)
the numerator is the Purchase Price which would otherwise (but for the
provisions of this subsection 5.1) be in effect, and (ii) the denominator
is the Purchase Price in effect on the date of such exercise.
5.2. DEFINITIONS, ETC. For purposes of this section 5 and of section 7:
The issuance of any warrants, options or other
subscription or purchase rights with respect to shares of Common
Stock and the issuance of any securities convertible into or
exchangeable for shares of Common Stock (or the issuance of any
warrants, options or any rights with respect to such convertible or
exchangeable securities) shall be deemed an issuance at such time of
such Common Stock if the Net Consideration Per Share which may be
received by the Company for such Common Stock (as hereinafter
determined) shall be less than the Purchase Price at the time of such
issuance and, except as hereinafter provided, an adjustment in the
Purchase Price and the number of shares of Common Stock issuable upon
exercise of this Warrant shall be made upon each such issuance in the
manner provided in subsection 5.1. Any obligation, agreement or
undertaking to issue warrants, options, or other subscription or
purchase rights at any time in the future shall be deemed to be an
issuance at the time such obligation, agreement or undertaking
-6-
is made or arises. No adjustment of the Purchase Price and the
number of shares of Common Stock issuable upon exercise of this
Warrant shall be made under subsection 5.1 upon the issuance of any
shares of Common Stock which are issued pursuant to the exercise of
any warrants, options or other subscription or purchase rights or
pursuant to the exercise of any conversion or exchange rights in any
convertible securities if any adjustment shall previously have been
made upon the issuance of any such warrants, options or other rights
or upon the issuance of any convertible securities (or upon the
issuance of any warrants, options or any rights therefor) as above
provided. Any adjustment of the Purchase Price and the number of
shares of Common Stock issuable upon exercise of this Warrant with
respect to this subsection 5.2 which relates to warrants, options or
other subscription or purchase rights with respect to shares of
Common Stock shall be disregarded if, as, and when all of such
warrants, options or other subscription or purchase rights expire or
are canceled without being exercised, so that the Purchase Price
effective immediately upon such cancellation or expiration shall be
equal to the Purchase Price in effect at the time of the issuance of
the expired or canceled warrants, options or other subscriptions or
purchase rights, with such additional adjustments as would have been
made to that Purchase Price had the expired or canceled warrants,
options or other subscriptions or purchase rights not been issued.
For purposes of this subsection 5.2, the "Net Consideration Per
Share" which may be received by the Company shall be determined as
follows:
(A) The "Net Consideration Per Share" shall mean the
amount equal to the total amount of consideration, if any,
received by the Company for the issuance of such warrants,
options, subscriptions, or other purchase rights or convertible
or exchangeable securities, plus the minimum amount of
consideration, if any, payable to the Company upon exercise or
conversion thereof, divided by the aggregate number of shares of
Common Stock that would be issued if all such warrants, options,
subscriptions, or other purchase rights or convertible or
exchangeable securities were exercised, exchanged or converted.
(B) The "Net Consideration Per Share" which may be
received by the Company shall be determined in each instance as
of the date of issuance of warrants, options, subscriptions or
other purchase rights, or convertible or exchangeable securities
without giving effect to any possible future price adjustments or
rate adjustments which may be applicable with respect to such
warrants, options, subscriptions or other purchase rights or
convertible securities.
For purposes of this section 5, if a part or all of the consideration
received by the Company in connection with the issuance of shares of the
Common Stock or the issuance of any of the securities described in this
section 5, consists of property other than cash, such consideration shall
be deemed to have the same value
-7-
as shall be determined in good faith by the Board of Directors of the
Company.
This subsection 5.2 shall not apply under any of the circumstances
described in subsections 5.4 and 5.5.
5.3. DILUTION IN CASE OF OTHER SECURITIES. In case any Other
Securities shall be issued or sold, or shall become subject to issue upon
the conversion or exchange of any stock (or Other Securities) of the
Company (or any other issuer of Other Securities or any other person
referred to in section 4) or to subscription, purchase or other
acquisition pursuant to any rights or options granted by the Company (or
such other issuer or person), for a consideration per share such as to
dilute the purchase rights evidenced by this Warrant, the computations,
adjustments and readjustments provided for in this section 5 with respect
to the Purchase Price and the number of shares of Common Stock issuable
upon exercise of this Warrant shall be made as nearly as possible in the
manner so provided and applied to determine the amount of Other Securities
from time to time receivable on the exercise of the Warrants, so as to
protect the holders of the Warrants against the effect of such dilution.
5.4. EXTRAORDINARY EVENTS. In the event that the Company shall
(i) issue additional shares of the Common Stock as a dividend or other
distribution on outstanding Common Stock, (ii) subdivide its outstanding
shares of Common Stock, or (iii) combine its outstanding shares of the
Common Stock into a smaller number of shares of the Common Stock, then, in
each such event, the Purchase Price shall, simultaneously with the
happening of such event, be adjusted by multiplying the then Purchase
Price by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding immediately prior to such event and the
denominator of which shall be the number of shares of Common Stock
outstanding immediately after such event, and the product so obtained
shall thereafter be the Purchase Price then in effect. The Purchase
Price, as so adjusted, shall be readjusted in the same manner upon the
happening of any successive event or events described herein in this
subsection 5.4. The holder of this Warrant shall thereafter, on the
exercise hereof as provided in section 1, be entitled to receive that
number of shares of Common Stock determined by multiplying the number of
shares of Common Stock which would otherwise (but for the provisions of
this subsection 5.4) be issuable on such exercise by a fraction of which
(i) the numerator is the Purchase Price which would otherwise (but for
the provisions of this subsection 5.4) be in effect, and (ii) the
denominator is the Purchase Price in effect on the date of such exercise.
5.5 EXCLUDED SHARES. Section 5.1 shall not apply to the
issuance of shares of Common Stock or options therefor, to directors,
officers and employees of the Company pursuant to any stock options, stock
purchase, stock ownership or compensation plan approved by the Company's
Board of Directors, provided that the aggregate number of shares, and
options therefor (including options outstanding on the date of the
Agreement), so issued to directors, officers and employees does not exceed
328,000.
-8-
6. NO DILUTION OR IMPAIRMENT. The Company will not, by amendment of
its Certificate of Incorporation or through any reorganization, transfer
of assets, consolidation, merger, dissolution, issue or sale of securities
or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of the Warrants, but will at all times in
good faith assist in the carrying out of all such terms and in the taking
of all such action as may be necessary or appropriate in order to protect
the rights of the holders of the Warrants against dilution or other
impairment. Without limiting the generality of the foregoing, the Company
(a) will not increase the par value of any shares of stock receivable on
the exercise of the Warrants above the amount payable therefor on such
exercise, (b) will take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and
nonassessable shares of stock on the exercise of all Warrants from time to
time outstanding, and (c) will not transfer all or substantially all of
its properties and assets to any other person (corporate or otherwise), or
consolidate with or merge into any other person or permit any such person
to consolidate with or merge into the Company (if the Company is not the
surviving person), unless such other person shall expressly assume in
writing and will be bound by all the terms of the Warrants.
7. ACCOUNTANTS' CERTIFICATE AS TO ADJUSTMENTS. In each case of any
adjustment or readjustment in the shares of Common Stock (or Other
Securities) issuable on the exercise of the Warrants, the Company at its
expense will promptly cause independent certified public accountants of
recognized standing selected by the Company to compute such adjustment or
readjustment in accordance with the terms of the Warrants and prepare a
certificate setting forth such adjustment or readjustment and showing in
detail the facts upon which such adjustment or readjustment is based,
including a statement of (a) the consideration received or receivable by
the Company for any additional shares of Common Stock (or Other
Securities) issued or sold or deemed to have been issued or sold, (b) the
number of shares of Common Stock (or Other Securities) outstanding or
deemed to be outstanding, and (c) the Purchase Price and the number of
shares of Common Stock to be received upon exercise of this Warrant, in
effect immediately prior to such issue or sale and as adjusted and
readjusted as provided in this Warrant. The Company will forthwith mail a
copy of each such certificate to each holder of a Warrant, and will, on
the written request at any time of any holder of a Warrant, furnish to
such holder a like certificate setting forth the Purchase Price at the
time in effect and showing how it was calculated.
8. NOTICES OF RECORD DATE, ETC. In the event of
(a) any taking by the Company of a record of the holders
of any class or securities for the purpose of determining the
holders thereof who are entitled to receive any dividend or other
distribution, or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, or
-9-
(b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the
Company or any transfer of all or substantially all the assets of
the Company to or consolidation or merger of the Company with or
into any other person, or
(c) any voluntary or involuntary dissolution, liquidation
or winding-up of the Company, or
(d) any proposed issue or grant by the Company of any
shares of stock of any class or any other securities, or any
right or option to subscribe for, purchase or otherwise acquire
any shares of stock of any class or any other securities (other
than the issue of Common Stock on the exercise of the Warrants),
then and in each such event the Company will mail or cause to be mailed to
each holder of a Warrant a notice specifying (i) the date on which any
such record is to be taken for the purpose of such dividend, distribution
or right, and stating the amount and character of such dividend,
distribution or right, (ii) the date on which any such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding-up is to take place, and the time, if
any is to be fixed, as of which the holders of record of Common Stock (or
Other Securities) shall be entitled to exchange their shares of Common
Stock (or Other Securities) for securities or other property deliverable
on such reorganization, reclassification, recapitalization, transfer,
consolidation, merger, dissolution, liquidation or winding-up, and (iii)
the amount and character of any stock or other securities, or rights or
options with respect thereto, proposed to be issued or granted, the date of
such proposed issue or grant and the persons or class of persons to whom
such proposed issue or grant is to be offered or made. Such notice shall
be mailed at least 20 days prior to the date specified in such notice on
which any such action is to be taken.
9. RESERVATION OF STOCK, ETC., ISSUABLE ON EXERCISE OF WARRANTS.
The Company will at all times reserve and keep available, solely for
issuance and delivery on the exercise of the Warrants, all shares of
Common Stock (or Other Securities) from time to time issuable on the
exercise of the Warrants.
10. EXCHANGE OF WARRANTS. On surrender for exchange of any Warrant,
properly endorsed, to the Company, the Company at its expense will issue
and deliver to or on the order of the holder thereof a new Warrant or
Warrants of like tenor, in the name of such holder or as such holder (on
payment by such holder of any applicable transfer taxes) may direct,
calling in the aggregate on the face or faces thereof for the number of
shares of Common Stock called for on the face or faces of the Warrant or
Warrants so surrendered.
11. REPLACEMENT OF WARRANTS. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation
of any Warrant and, in the case of any such loss, theft or destruction of
any Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company
-10-
or, in the case of any such mutilation, on surrender and cancellation of
such Warrant, the Company at its expense will execute and deliver, in lieu
thereof, a new Warrant of like tenor.
12. WARRANT AGENT. The Company may, by written notice to each
holder of a Warrant, appoint an agent having an office in either Boston,
Massachusetts or New York, New York for the purpose of issuing Common
Stock (or Other Securities) on the exercise of the Warrants pursuant to
section 1, exchanging Warrants pursuant to section 10, and replacing
Warrants pursuant to section 11, or any of the foregoing, and thereafter
any such issuance, exchange or replacement, as the case may be, shall be
made at such office by such agent.
13. REMEDIES. The Company stipulates that the remedies at law of
the holder of this Warrant in the event of any default or threatened
default by the Company in the performance of or compliance with any of the
terms of this Warrant are not and will not be adequate, and that such
terms may be specifically enforced by a decree for the specific
performance of any agreement contained herein or by an injunction against
a violation of any of the terms hereof or otherwise.
14. NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms, to all of which each holder or owner hereof by the taking hereof
consents and agrees:
(a) title to this Warrant may be transferred by
endorsement (by the holder hereof executing the form of assignment at
the end hereof) and delivery in the same manner as in the case of a
negotiable instrument transferable by endorsement and delivery;
(b) any person in possession of this Warrant properly
endorsed is authorized to represent himself as absolute owner hereof
and is empowered to transfer absolute title hereto by endorsement and
delivery hereof to a bona fide purchaser hereof for value; each prior
taker or owner waives and renounces all of his equities or rights in
this Warrant in favor of each such bona fide purchaser, and each such
bona fide purchaser shall acquire absolute title hereto and to all
rights represented hereby;
(c) until this Warrant is transferred on the books of the
Company, the Company may treat the registered holder hereof as the
absolute owner hereof for all purposes, notwithstanding any notice to
the contrary; and
(d) each Warrant issued upon any transfer, exchange or
replacement of this Warrant shall bear the legend set forth on the
first page hereof and transfers thereof will be restricted in
accordance with such legend.
15. NOTICES, ETC. All notices and other communications from the
Company to the holder of this Warrant shall be mailed by first class
registered or certified mail, postage prepaid, at such address
-11-
as may have been furnished to the Company in writing by such holder or,
until any such holder furnishes to the Company an address, then to, and
at the address of, the last holder of this Warrant who has so furnished
an address to the Company.
16. MISCELLANEOUS. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed
by the party against which enforcement of such change, waiver, discharge
or termination is sought. This Warrant shall be construed and enforced in
accordance with and governed by the laws of the Commonwealth of
Massachusetts. The headings in this Warrant are for purposes of reference
only, and shall not limit or otherwise affect any of the terms hereof.
This Warrant is being executed as an instrument under seal. The
invalidity or unenforceability of any provision hereof shall in no way
affect the validity or enforceability of any other provision.
17. EXPIRATION; AUTOMATIC EXERCISE. The right to exercise this
Warrant shall expire at 5:00 P.M., Boston time, on the later of (i)
June 30, 2000 or (ii) at such time as all principal and interest on the
Notes (as defined in the Agreement) is paid in full. Notwithstanding the
foregoing, this Warrant shall automatically be deemed to be exercised in
full pursuant to the provisions of subsection 1.4 hereof, without any
further action on behalf of the holder hereof, immediately prior to the
time this Warrant would otherwise expire pursuant to the preceding
sentence.
Dated: April 12, 1995 MATEC CORPORATION
By
----------------------------------
Robert B. Gill, President
-12-
FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
TO MATEC CORPORATION
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise this Warrant for, and to purchase thereunder, ........
shares of Common Stock of MATEC CORPORATION and herewith makes payment of
$........ therefor, and requests that the certificates for such shares be
issued in the name of, and delivered to .............., whose address is
...................
Dated: ...................................
(Signature must conform to name of
holder as specified on the face of
the Warrant)
...............................
(Address)
------------------
FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and transfers
unto .................. the right represented by the within Warrant to
purchase ............. shares of Common Stock of MATEC CORPORATION to
which the within Warrant relates, and appoints ..........................
Attorney to transfer such right on the books of MATEC CORPORATION with
full power of substitution in the premises.
Dated: ..............................
(Signature must conform to name of
holder as specified on the face of
the Warrant)
...............................
(Address)
Signed in the presence of:
...........................
-13-
EX-11
3
COMPUTATION OF PER SHARE EARNINGS
MATEC Corporation and Subsidiaries Exhibit 11
Calculation of Earnings Per Share
(amounts in thousands, except per share data)
Three Months Ended
7/2/95 7/3/94
------ ------
Net earnings (loss) ................................ $ 28 $ (103)
====== ======
CALCULATION OF PRIMARY EARNINGS (LOSS) PER SHARE:
Weighted average common shares outstanding ........ 2,765 2,765
Increase from assumed exercise of stock options
and investment of proceeds in treasury stock,
based upon average market prices (A) ............. 26 -
----- -----
Average common stock and common equivalent
shares outstanding (D) ........................... 2,791 2,765
===== =====
Net earnings (loss) per common and common
equivalent share (B) ............................. $ .01 $ (.04)
====== ======
CALCULATION OF FULLY DILUTED EARNINGS (LOSS)
PER SHARE:
Weighted average common shares outstanding ........ 2,765 2,765
Increase from assumed exercise of stock options
and investment of proceeds in treasury stock,
based upon the higher of average or
quarter-end market prices ........................ 26 10
----- -----
Average common stock and common equivalent
shares used to calculate fully diluted earnings
per share (D) .................................... 2,791 2,775
===== =====
Net earnings (loss) per common and common
equivalent share assuming full dilution (C) ...... $ .01 $ (.04)
====== ======
(A) In loss periods, dilutive common equivalent shares are excluded as
the effect would be anti-dilutive.
(B) Dilution from stock options is less than 3%, therefore primary
earnings per share is based on the weighted average number of shares
outstanding.
(C) Dilution is less than 3%, therefore the primary basis was used for
per share calculations.
(D) The effect of the outstanding warrants is excluded since they do not
meet either test of paragraph 37 of APB Opinion No. 15.
-28-
MATEC Corporation and Subsidiaries Exhibit 11
Calculation of Earnings per Share
(amounts in thousand, except per share data)
Six Months Ended
7/2/95 7/3/94
------ ------
Net earnings (loss) ............................... $ 34 $ (270)
====== ======
CALCULATION OF PRIMARY EARNINGS (LOSS) PER SHARE:
Weighted average common shares outstanding ....... 2,765 2,765
Increase from assumed exercise of stock options
and investment of proceeds in treasury stock,
based upon average market prices (A) ............ 29 -
----- -----
Average common stock and common equivalent
shares outstanding (D) .......................... 2,794 2,765
===== =====
Net earnings (loss) per common and common
equivalent share (B) ............................ $ .01 $ (.10)
====== ======
CALCULATION OF FULLY DILUTED EARNINGS (LOSS)
PER SHARE:
Weighted average common shares outstanding ....... 2,765 2,765
Increase from assumed exercise of stock options
and investment of proceeds in treasury stock,
based upon the higher of average or
quarter-end market prices ....................... 29 15
----- -----
Average common stock and common equivalent
shares used to calculate fully diluted earnings
per share (D) ................................... 2,794 2,780
===== =====
Net earnings (loss) per common and common
equivalent share assuming full dilution (C) ..... $ .01 $ (.10)
====== ======
(A) In loss periods, dilutive common equivalent shares are excluded as
the effect would be anti-dilutive.
(B) Dilution from stock options is less than 3%, therefore primary
earnings per share is based on the weighted average number of shares
outstanding.
(C) Dilution is less than 3%, therefore the primary basis was used for
per share calculations.
(D) The effect of the outstanding warrants is excluded since they do not
meet either test of paragraph 37 of APB Opinion No. 15.
-29-
EX-27
4
FINANCIAL DATA SCHEDULE
5
1,000
6-MOS
DEC-31-1995
JUL-02-1995
474
0
4,887
218
6,429
12,751
18,311
11,536
21,479
4,956
2,178
190
0
0
12,928
21,479
13,345
13,345
9,398
9,398
3,666
21
173
56
22
34
0
0
0
34
.01
.01