-----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, T2hkSHrXeWLGt0FvQWQSjnYT0vpwBnITirad6lSYujTR4XK8SwSTOXMdFq5R17fe V9956zKvF9aS4y0AcmI53Q== 0000950131-97-001896.txt : 19970319 0000950131-97-001896.hdr.sgml : 19970319 ACCESSION NUMBER: 0000950131-97-001896 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960906 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970318 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOKHEIM CORP CENTRAL INDEX KEY: 0000098559 STANDARD INDUSTRIAL CLASSIFICATION: REFRIGERATION & SERVICE INDUSTRY MACHINERY [3580] IRS NUMBER: 350712500 STATE OF INCORPORATION: IN FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-06018 FILM NUMBER: 97558714 BUSINESS ADDRESS: STREET 1: 10501 CORPORATE DRIVE STREET 2: P O BOX 360 CITY: FORT WAYNE STATE: IN ZIP: 46801-0360 BUSINESS PHONE: 2194232552 8-K/A 1 AMENDMENT #1 TO FORM 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 1 TO FORM 8-K/A CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): September 6, 1996 TOKHEIM CORPORATION ------------------------------------- (Exact Name of Company as Specified in its Charter) Indiana 1-6018 35-0712500 ------- ------ ---------- (State or other jurisdiction of (Commission (IRS Employer incorporation or organization) File Number) Identification Number) 10501 Corporate Drive, P.O. Box 360, Fort Wayne, IN 46801 - ----------------------------------------------------- ----- (Address of principal executive office) (Zip Code) (219)-470-4600 ----------------------------------------------------- (Company's telephone number, including area code) N/A --------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS On September 6, 1996, Tokheim Corporation (the "Company") completed the acquisition of the petroleum dispenser business of Sofitam S.A. (the "Acquired Business"), a French corporation. The transaction was reported on a Form 8-K dated September 6, 1996. The required interim financial statements and the interim pro forma information were not available at that time. The following financial statements are filed as part of this amendment to the Form 8-K. (a) Financial Statements of the Business Acquired. - Sofitam S.A. unaudited combined balance sheets as of June 30, 1996 and 1995. - Sofitam S.A. unaudited combined statements of income for the six months ended June 30, 1996 and 1995. - Sofitam S.A. unaudited combined statements of cash flows for the six months ended June 30, 1996 and 1995. - Sofitam S.A. audited combined balance sheets as of December 31, 1995 and 1994. - Sofitam S.A. audited combined statements of income for the years ended December 31, 1995, 1994 and 1993. - Sofitam S.A. audited combined statements of cash flows for the years ended December 31, 1995, 1994 and 1993. - Sofitam S.A. notes to the audited combined financial statements for the years ended December 31, 1995, 1994 and 1993. (b) Pro Forma Financial Information - Pro forma condensed combined statement of operations for the six months ended May 31, 1996. - Pro forma condensed combined statement of operations for the year ended November 30, 1995. - Pro forma condensed combined balance sheet as of May 31, 1996. - Notes to unaudited pro forma condensed combined financial statements. 2 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 thereto duly authorized. TOKHEIM CORPORATION ------------------- Registrant Date: March 17, 1997 By: /s/ Douglas K. Pinner ----------------------- Douglas K. Pinner Chairman of the Board, President and Chief Executive Officer and Director Date: March 17, 1997 By: /s/ John A. Negovetich ----------------------- John A. Negovetich President, Tokheim, North America and Acting Chief Financial Officer 3 FINANCIAL STATEMENTS OF THE ACQUIRED BUSINESS FUEL PUMP DIVISION OF SOFITAM S.A. UNAUDITED COMBINED BALANCE SHEETS AS OF JUNE 30, 1996 AND 1995
- ------------------------------------------------------------------------------- (IN FRF THOUSANDS) JUNE 30, JUNE 30, ASSETS 1996 1995 - ------------------------------------------------------------------------------- Fixed assets Intangible assets, net 3 722 5 026 Property, plant and equipment, net 46 050 44 230 Shares in non-combined companies, net 52 995 52 995 Companies accounted for by the equity method 872 807 Other long-term assets, net 7 109 9 661 - ------------------------------------------------------------------------------- Total fixed assets 110 748 112 719 - ------------------------------------------------------------------------------- Current assets Inventories, net 188 753 197 451 Trade and other receivables, net 318 493 272 929 Cash and cash equivalents 41 938 31 271 - ------------------------------------------------------------------------------- Total current assets 549 184 501 651 - ------------------------------------------------------------------------------- TOTAL ASSETS 659 932 614 370 ======= ======= - ------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY - ------------------------------------------------------------------------------- Shareholders' equity 72 646 (26 142) of which Group interest 68 511 (28 670) of which Minority interests 4 135 2 528 - ------------------------------------------------------------------------------- Long-term liabilities Provisions for contingencies and charges 16 614 16 556 Long-term borrowings and participating loans 104 188 183 232 - ------------------------------------------------------------------------------- Total long-term liabilities 120 802 199 788 - ------------------------------------------------------------------------------- Current liabilities Trade and other payables 269 261 245 947 Short-term borrowings 197 223 194 777 - ------------------------------------------------------------------------------- Total current liabilities 466 484 440 724 - ------------------------------------------------------------------------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 659 932 614 370 ======= ======= - -------------------------------------------------------------------------------
1 FUEL PUMP DIVISION OF SOFITAM S.A. UNAUDITED COMBINED STATEMENTS OF INCOME FOR THE SIX-MONTH PERIODS ENDED AS OF JUNE 30, 1996 AND 1995
- ------------------------------------------------------------------------------------ (IN FRF THOUSANDS) JUNE 30, 1996 JUNE 30, 1995 - ----------------------------------------------------------------------------------- Sales 455 878 441 884 Other revenues 459 3 211 Purchases used in production (278 768) (275 297) Personnel costs (133 706) (126 915) Depreciation and amortization (11 407) (7 308) - ----------------------------------------------------------------------------------- Income from operations 32 456 35 575 - ----------------------------------------------------------------------------------- Interest income 1 201 1 551 Interest expense (9 720) (12 774) Other financial income/(expense) (2 228) (532) - ----------------------------------------------------------------------------------- Financial expense, net (10 747) (11 755) - ----------------------------------------------------------------------------------- Exceptional income/(expense), net (1 695) (676) - ----------------------------------------------------------------------------------- Income before profit sharing and income taxes 20 014 23 144 - ----------------------------------------------------------------------------------- Employee profit sharing (4 000) (2 269) Income taxes (2 113) (8 665) Income from companies accounted for by the equity method 0 66 - ----------------------------------------------------------------------------------- Combined net income/(loss) 13 901 12 276 of which Group interest 13 274 11 534 of which Minority interests 627 742 - -----------------------------------------------------------------------------------
2 FUEL PUMP DIVISION OF SOFITAM S.A. UNAUDITED COMBINED STATEMENTS OF CASH FLOWS FOR THE SIX-MONTH PERIODS ENDED AS OF JUNE 30, 1996 AND 1995
- ---------------------------------------------------------------------------------- (IN FRF THOUSANDS) JUNE 30, 1996 JUNE 30, 1995 - ---------------------------------------------------------------------------------- Net income/(loss) from combined companies 13 901 12 276 Depreciation and provisions 11 407 7 308 Income from companies accounted for by the equity method -- (66) Net (increase)/decrease in working capital 20 105 8 578 - ---------------------------------------------------------------------------------- Cash flows from operating activities 45 413 28 096 - ---------------------------------------------------------------------------------- Acquisition of fixed assets (6 157) (9 608) Proceeds from disposal of fixed assets 129 1 432 Net increase/(decrease) in loans and long term deposits 2 405 105 Investments in subsidiaries 169 -- Other movements on investing activities (553) (1 090) - ---------------------------------------------------------------------------------- Cash flows from investing and other activities (4 007) (9 161) - ---------------------------------------------------------------------------------- Net increase/(decrease) of short-term borrowings (19 282) (7 642) Net issuance/(repayment) of long term debt (2 770) 2 708 Payments of dividends -- (5 000) - ---------------------------------------------------------------------------------- Cash flows from financing activities (22 052) (9 934) - ---------------------------------------------------------------------------------- Increase in net cash and cash equivalents 19 354 9 001 Cash and cash equivalents at beginning of the year 22 584 22 270 Cash and cash equivalents at end of the year 41 938 31 271 - ----------------------------------------------------------------------------------
3 AUDITOR'S REPORT ON THE FUEL PUMP DIVISION OF SOFITAM S.A. To the stockholders of SOFITAM S.A.: We have audited the accompanying combined balance sheets of the Fuel Pump Division of SOFITAM S.A. as of December 31, 1995 and 1994 and the related combined statements of income and cash flows for each of the three years in the period ended December 31, 1995. These combined financial statements have been prepared subsequent to the purchase of the Fuel Pump Division of SOFITAM S.A. by TOKHEIM CORPORATION in accordance with the Option Agreement dated May 7, 1996, which was exercised on July 5, 1996. These financial statements are the responsibility of the management of SOFITAM S.A. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with International Standards on Auditing which have been applied on a basis that is substantially similar with Generally Accepted Auditing Standards in the United States. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the combined financial statements referred to above present fairly, in all material respects, the combined financial position of the Fuel Pump Division of SOFITAM S.A. at December 31, 1995 and 1994 and the combined results of their operations and cash flows for each of the three years in the period ended December 31, 1995 in conformity with accounting principles generally accepted in France which differ in certain respects from those followed in the United States (see Notes 21 and 22 to the combined financial statements). Paris, July 15, 1996, except for Notes 21 and 22, as to which the date is November 20, 1996 SALUSTRO REYDEL Bernard CATTENOZ 4 FUEL PUMP DIVISION OF SOFITAM S.A. AUDITED COMBINED BALANCE SHEETS AS OF DECEMBER 31, 1995 AND 1994 - -------------------------------------------------------------------------------
(IN FRF THOUSANDS) DEC 31, DEC 31, ASSETS NOTES 1995 1994 - ------------------------------------------------------------------------------- Fixed assets Intangible assets, net................................... 2 3 618 5 041 Property, plant and equipment, net....................... 3 45 405 42 811 Shares in non-combined companies, net.................... 4 52 995 53 002 Companies accounted for by the equity method............. 5 872 -- Other long-term assets, net.............................. 9 514 9 766 - ------------------------------------------------------------------------------- Total fixed assets................................... 112 404 110 620 - ------------------------------------------------------------------------------- Current assets Inventories, net......................................... 6 185 097 184 977 Trade and other receivables, net......................... 7 320 099 295 351 Cash and cash equivalents................................ 22 584 22 270 - ------------------------------------------------------------------------------- Total current assets................................. 527 780 502 598 - ------------------------------------------------------------------------------- Total assets............................................. 640 184 613 218 ======= ======= - ------------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Shareholders' equity..................................... 8 58 739 (32 454) of which Group interest.................................. 55 039 (36 250) of which Minority interests.............................. 3 700 3 796 - ------------------------------------------------------------------------------- Long-term liabilities Provisions for contingencies and charges................. 9 14 787 15 518 Long-term borrowings and participating loans............. 10 106 958 180 524 - ------------------------------------------------------------------------------- Total long-term liabilities.......................... 121 745 196 042 - ------------------------------------------------------------------------------- Current liabilities Trade and other payables................................. 11 243 195 247 211 Short-term borrowings.................................... 12 216 505 202 419 - ------------------------------------------------------------------------------- Total current liabilities............................ 459 700 449 630 - ------------------------------------------------------------------------------- Total liabilities and shareholders' equity............... 640 184 613 218 ======= ======= - -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements 5 FUEL PUMP DIVISION OF SOFITAM S.A. AUDITED COMBINED INCOME STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993 - -------------------------------------------------------------------------------
(IN FRF THOUSANDS) NOTES 1995 1994 1993 - ------------------------------------------------------------------------------- Sales...................................... 13 878 896 729 739 737 155 Other revenues............................. 878 2 821 2 468 Purchases used in production............... (547 946) (455 387) (453 096) Personnel costs............................ (246 664) (243 731) (243 908) Depreciation and amortization.............. (12 054) (15 017) (14 013) - ------------------------------------------------------------------------------- Income from operations................. 73 110 18 425 28 606 - ------------------------------------------------------------------------------- Interest income............................ 4 780 2 306 3 855 Interest expense........................... (23 754) (20 645) (28 672) Other financial income/(expense)........... 34 (116) 676 - ------------------------------------------------------------------------------- Financial expense, net................. (18 940) (18 455) (24 141) - ------------------------------------------------------------------------------- Exceptional income/(expense), net.......... 14 (24 937) 37 445 (2 692) - ------------------------------------------------------------------------------- Income before profit sharing and income taxes..................................... 29 233 37 415 1 773 - ------------------------------------------------------------------------------- Employee profit sharing.................... (4 278) (948) (1 818) Income taxes............................... 15 (1 224) (3 125) (4 354) Income from companies accounted for by the equity method............................. 131 -- -- - ------------------------------------------------------------------------------- Combined net income/(loss)................. 23 862 33 342 (4 399) of which Group interest.................... 22 441 37 070 (1 238) of which Minority interests................ 1 421 (3 728) (3 161) - -------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements 6 FUEL PUMP DIVISION OF SOFITAM S.A. AUDITED COMBINED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
- ------------------------------------------------------------------------------ (IN FRF THOUSANDS) 1995 1994 1993 - ------------------------------------------------------------------------------ Net income/(loss) from combined companies........... 23 862 33 342 (4 399) Depreciation and provisions......................... 29 932 13 190 16 051 Income from companies accounted for by the equity method............................................. (131) -- -- Net (increase)/decrease in working capital.......... (47 493) (11 930) (4 649) - ------------------------------------------------------------------------------ Cash flows from operating activities............ 6 170 34 602 7 003 - ------------------------------------------------------------------------------ Acquisition of fixed assets......................... (16 746) (18 162) (15 457) Proceeds from disposal of fixed assets.............. 553 392 778 Net increase/(decrease) in loans and long term deposits........................................... 252 (278) 10 320 Other movements on investing activities............. 2 139 (1 255) 121 - ------------------------------------------------------------------------------ Cash flows from investing and other activities.. (13 802) (19 303) (4 238) - ------------------------------------------------------------------------------ Proceeds from issuance of share capital............. 72 426 211 10 749 Net increase/(decrease) of short-term borrowings.... 14 086 45 994 16 214 Net repayment of long term debt..................... (73 566) (40 474) (20 773) Payments of dividends............................... (5 000) (17 740) (6 264) - ------------------------------------------------------------------------------ Cash flows from financing activities............ 7 946 (12 009) (74) - ------------------------------------------------------------------------------ Increase in net cash and cash equivalents........... 314 3 290 2 691 Cash and cash equivalents at beginning of the year.. 22 270 18 980 16 289 Cash and cash equivalents at end of the year........ 22 584 22 270 18 980 - ------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements 7 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993 NOTE 1--SUMMARY OF ACCOUNTING POLICIES (a) Principles of combination The combined historical financial statements include the accounts of certain companies within the Fuel Pump Division ("the Division") of Sofitam S.A., a French company. The Division manufactures, distributes and services petroleum dispensing equipment. The financial statements have been combined and prepared subsequent to the purchase of the Fuel Pump Division of Sofitam S.A. by Tokheim Corporation in accordance with the Option Agreement dated May 7, 1996, which was exercised on July 5, 1996. Tokheim Corporation is purchasing Sofitam's interests in certain companies within the Division in France, the United Kingdom, Belgium, Germany, Switzerland, Italy, Spain and several African countries. A list of the companies concerned is set out in Note 20 to these accounts. The underlying financial statements included in the combination have been prepared in accordance with accounting principles generally accepted in France. These financial statements have been combined in accordance with the French methodology promulgated by the Conseil National de la Comptabilite (French National Accounting Committee) by aggregating the annual accounts of all entities included in the combination. Where one entity owns an interest in another entity included in the combination, the investment carried in the balance sheet of the former entity has been eliminated. Entities in which the combined group has a direct or indirect controlling interest of at least 50% have been fully combined. Minority interests in shareholders' equity and net income have been calculated on the basis of the percentage interests held. Entities in which the combined group holds between 20% and 50% of the voting rights, and over which the combined group does not have full control, have been accounted for by the equity method. This method has been applied solely to Excelsior, acquired in 1995. Intercompany sales and purchases between entities included in the combined financial statements, together with intercompany debit and credit balances, have been eliminated in combination. (b) Scope of combination A list of the combined companies is set out in Note 20 to these accounts. Newly acquired companies are combined as from the date of acquisition or, for reasons of convenience, on the basis of their last balance sheet if their impact is not material to the Division as a whole. All companies within the Division have a December 31 year-end, with the exception of Cocitam (September 30) and Socatam (June 30). The activities of Socatam are not significant at the combined level. Cocitam has been included in the combination on the basis of its accounts at September 30 and Socatam on the basis of its accounts to December 31. Companies included in the scope of combination for the first time in 1994 include the 60% interest in Bennett Fimac, an Italian company. Companies included in the scope of combination for the first time in 1995 include the 20% interest in Excelsior, a French company, which is accounted for by the equity method, and the 100% interest in Sofitam Tanktechnik, a newly incorporated German company. (c) Translation of financial statements denominated in foreign currencies Exchange rates at December 31 of each year have been used to translate financial statements denominated in foreign currencies. Differences arising from the translation of opening net assets as of January 1 at the year-end rate are included in shareholders' equity and therefore have no impact on net income for the year. 8 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) (d) Intangible assets In 1995, the Division changed its accounting treatment for research and development costs related to new products. These were previously capitalized and depreciated over 3 years but from 1995 were expensed as incurred. Research and development costs of FRF 1 744 thousand capitalized in prior years were written off in full in 1995, and charged as an exceptional expense. In 1995, the Division also changed its accounting treatment for purchased goodwill. This was previously recognized by certain French companies for the amount of FRF 1 568 thousand and not amortized. From 1995, this goodwill is now amortized over a period of 20 years. The corresponding expense in 1995 of FRF 95 thousand has been charged against operating income. (e) Property, plant and equipment Property, plant and equipment is carried at cost. Depreciation is determined generally on a straight line basis over the following estimated useful lives : -Buildings................................................. 15 to 20 years -Plant and equipment....................................... 5 to 7 years -Other..................................................... 3 to 5 years
(f) Inventory valuation Inventories are stated at lower of cost or market value. Where necessary, provisions are recorded to take account of obsolete or slow-moving items. (g) Cash equivalents Cash equivalents consist of short-term investments with original maturities of less than three months when acquired. These securities are carried at cost which approximates market value. (h) Deferred taxes Deferred taxes are recorded using the liability method on all temporary differences between the financial reporting and tax bases of the Division's assets and liabilities. No deferred tax assets or liabilities have been recorded in the combined financial statements as the net position for each tax-paying entity in each tax jurisdiction would result in the recognition of deferred tax assets. These net assets have not been recognized in accordance with accounting principles generally accepted in France, because their realization was not probable at each year end date. (i) Leases Lease payments are expensed in the period to which they relate. The Division does not recognize, therefore, assets acquired under capital leases and the related lease obligations in the balance sheet. (j) Exceptional income and expense Exceptional income and expenses comprise those items which, due to their size, nature, or the infrequency with which they occur may be considered to be outside the normal activity of the Division. Exceptional items are presented before tax and minority interests. 9 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 2--INTANGIBLE ASSETS ANALYSIS OF MOVEMENTS ON INTANGIBLE ASSETS
- ------------------------------------------------------------------------------- DEC DEC 31, ACQUISITIONS/ DISPOSALS/ 31, (in FRF thousands) 1993 INCREASE DECREASE OTHER 1994 - -------------------------------------------------------------------------------- AT COST: . Start-up costs............. 1 674 395 (79) -- 1 990 . R&D costs.................. 869 2 606 -- -- 3 475 . Purchased goodwill......... 1 568 3 -- (92) 1 479 . Other...................... 5 246 2 334 (58) (88) 7 434 - -------------------------------------------------------------------------------- TOTAL...................... 9 357 5 338 (137) (180) 14 378 - -------------------------------------------------------------------------------- AMORTIZATION: . Start-up costs............. (1 672) -- -- -- (1 672) . R&D costs.................. (869) (862) -- -- (1 731) . Purchased goodwill......... -- -- -- -- -- . Other...................... (4 290) (1 740) 58 38 (5 934) - -------------------------------------------------------------------------------- TOTAL...................... (6 831) (2 602) 58 38 (9 337) - -------------------------------------------------------------------------------- INTANGIBLE ASSETS, NET..... 2 526 2 736 (79) (142) 5 041 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- DEC DEC 31, ACQUISITIONS/ DISPOSALS/ 31, (in FRF thousands) 1994 INCREASE DECREASE OTHER 1995 - -------------------------------------------------------------------------------- AT COST: . Start-up costs............. 1 990 30 -- (114) 1 906 . R&D costs.................. 3 475 919 -- (4 394) -- . Purchased goodwill......... 1 479 -- -- (8) 1 471 . Other...................... 7 434 1 334 -- (52) 8 716 - -------------------------------------------------------------------------------- TOTAL...................... 14 378 2 283 -- (4 568) 12 093 - -------------------------------------------------------------------------------- AMORTIZATION: . Start-up costs............. (1 672) -- -- 19 (1 653) . R&D costs.................. (1 731) -- -- 1 731 -- . Purchased goodwill......... -- (95) -- -- (95) . Other...................... (5 934) (856) -- 63 (6 727) - -------------------------------------------------------------------------------- TOTAL...................... (9 337) (951) -- 1 813 (8 475) - -------------------------------------------------------------------------------- INTANGIBLE ASSETS, NET..... 5 041 1 332 -- (2 755) 3 618 - --------------------------------------------------------------------------------
In 1995, the Fuel Pump Division changed its accounting treatment for research and development costs. Research and development costs capitalized at December 31, 1994 of FRF 3 475 thousand less accumulated amortization FRF 1 731 thousand were written off in full in 1995. The impact of the change of method was a charge of FRF 1 744 thousand, recorded as an exceptional item in 1995. Other movements mainly relate to translation differences. 10 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 3--PROPERTY, PLANT AND EQUIPMENT Analysis of movements on property, plant and equipment
- ------------------------------------------------------------------------------- DEC 31, ACQUISITIONS/ DISPOSALS/ DEC 31, (in FRF thousands) 1993 INCREASE DECREASE OTHER 1994 - ------------------------------------------------------------------------------- AT COST: . Land and buildings...... 40 618 2 533 (472) (899) 41 780 . Plant and equipment..... 47 758 3 717 (674) (701) 50 100 . Other................... 38 003 6 574 (1 852) (1 391) 41 334 - ------------------------------------------------------------------------------- TOTAL................... 126 379 12 824 (2 998) (2 991) 133 214 - ------------------------------------------------------------------------------- DEPRECIATION: . Land and buildings...... (20 372) (2 063) 472 216 (21 747) . Plant and equipment..... (34 506) (4 689) 666 359 (38 170) . Other................... (27 326) (5 663) 1 547 956 (30 486) - ------------------------------------------------------------------------------- TOTAL................... (82 204) (12 415) 2 685 1 531 (90 403) - ------------------------------------------------------------------------------- PROPERTY, PLANT AND EQUIPMENT, NET......... 44 175 409 (313) (1 460) 42 811 - -------------------------------------------------------------------------------
- ------------------------------------------------------------------------------- DEC 31, ACQUISITIONS/ DISPOSALS/ DEC 31, (in FRF thousands) 1994 INCREASE DECREASE OTHER 1995 - -------------------------------------------------------------------------------- AT COST: . Land and buildings........ 41 780 2 559 (438) (49) 43 852 . Plant and equipment....... 50 100 5 995 (907) 641 55 829 . Other..................... 41 334 5 909 (2 565) (814) 43 864 - -------------------------------------------------------------------------------- TOTAL..................... 133 214 14 463 (3 910) (222) 143 545 - -------------------------------------------------------------------------------- DEPRECIATION: . Land and buildings........ (21 747) (2 083) 151 38 (23 641) . Plant and equipment....... (38 170) (4 611) 891 (128) (42 018) . Other..................... (30 486) (4 409) 2 315 99 (32 481) - -------------------------------------------------------------------------------- TOTAL..................... (90 403) (11 103) 3 357 9 (98 140) - -------------------------------------------------------------------------------- PROPERTY, PLANT AND EQUIPMENT, NET........... 42 811 3 360 (553) (213) 45 405 - --------------------------------------------------------------------------------
Other movements mainly relate to translation differences. NOTE 4--SHARES IN NON COMBINED COMPANIES Shares in non combined companies principally relate to Sofitam International's investment of FRF 52 900 thousand in the Bennett Pump Company, a US company. The shares in Bennett Pump Company are not being acquired and are to be disposed of in accordance with the terms of the Option Agreement. The shares are to be transferred out of the balance sheet at a nominal value prior to the closing of the sale of the final pump division to Tokheim Corporation as described in Note 1. The financial statements of Bennett Pump Company have therefore not been included in these combined financial statements. NOTE 5--COMPANIES ACCOUNTED FOR BY THE EQUITY METHOD Only the investment in Excelsior, acquired in 1995, is accounted for by the equity method.
- -------------------------------------------------------------------------------- Percent Share of net Share of 1995 (in FRF thousands) Interest Assets net income - -------------------------------------------------------------------------------- Excelsior................................. 20% 872 131 - --------------------------------------------------------------------------------
11 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 6--INVENTORIES
- -------------------------------------------------------------------------------- DEC 31, DEC 31, (in FRF thousands) 1995 1994 - -------------------------------------------------------------------------------- Raw materials and supplies.................................... 128 781 124 580 Work in process............................................... 24 991 16 556 Finished and semi-finished products........................... 31 325 43 841 - -------------------------------------------------------------------------------- TOTAL..................................................... 185 097 184 977 - --------------------------------------------------------------------------------
Inventories are stated net of provisions. NOTE 7--TRADE AND OTHER RECEIVABLES
- -------------------------------------------------------------------------------- DEC 31, DEC 31, (in FRF thousands) 1995 1994 - -------------------------------------------------------------------------------- Trade receivables............................................. 311 567 283 142 Provisions.................................................... (8 340) (6 920) - -------------------------------------------------------------------------------- Trade receivables, net........................................ 303 227 276 222 Other receivables............................................. 16 872 19 129 - -------------------------------------------------------------------------------- TOTAL TRADE AND OTHER RECEIVABLES, NET.................... 320 099 295 351 - --------------------------------------------------------------------------------
NOTE 8--SHAREHOLDERS' EQUITY Analysis of movements in shareholders' equity
- ------------------------------------------------------------------------------- COMMON RETAINED SHAREHOLDERS' MINORITY (in FRF thousands) STOCK PREMIUM EARNINGS EQUITY INTERESTS - -------------------------------------------------------------------------------- BALANCE AT DECEMBER 31, 1993.. 33 769 7 672 (86 862) (45 421) 8 339 - -------------------------------------------------------------------------------- 1994 net income............... -- -- 33 342 33 342 (3 728) Translation difference........ -- -- (3 212) (3 212) 255 Change in scope of combination................... -- -- 98 98 (787) Dividends paid................ -- -- (17 740) (17 740) -- Other movements............... -- -- 479 479 (283) - -------------------------------------------------------------------------------- BALANCE AT DECEMBER 31, 1994.. 33 769 7 672 (73 895) (32 454) 3 796 - -------------------------------------------------------------------------------- 1995 net income............... -- -- 23 862 23 862 1 421 Capital increase.............. 72 426 -- -- 72 426 213 Merger of SATAM and EIN....... 12 250 9 889 (22 139) -- -- Translation difference........ -- -- 500 500 317 Change in scope of combination................... -- -- (1 254) (1 254) (1 996) Dividends paid................ -- -- (5 000) (5 000) -- Other movements............... -- -- 659 659 (51) - -------------------------------------------------------------------------------- BALANCE AT DECEMBER 31, 1995.. 118 445 17 561 (77 267) 58 739 3 700 - --------------------------------------------------------------------------------
In 1994, Bennett Fimac with shareholders' equity of FRF 1 475 thousand, was included in the combined financial statements for the first time. In addition, the Division acquired the remaining 50% minority interest in Cottam. In 1995, Sofitam converted its participating loan in Sofitam International, resulting in a capital increase of FRF 72 000 thousand. 12 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 8--SHAREHOLDERS' EQUITY (CONTINUED) On November 21, 1995, EIN was merged into SATAM to form Sofitam Equipement with retroactive effect from January 1, 1995. These two companies were wholly owned subsidiaries of Sofitam throughout the period and are therefore included within the combined financial statements. They were merged to improve operational efficiency. This transaction, based on the net book values of the net assets of each company, resulted in the exchange of 13 shares of SATAM for 1 share of EIN. The net book value of EIN was FRF 26 139 thousand, remunerated by common stock of FRF 16 250 thousand and a premium of FRF 9 889 thousand. As the common stock of Ein was FRF 4 000 thousand before this operation, there was an increase in common stock of FRF 12 250 thousand. In addition, in 1995, a 20% interest was acquired in Excelsior, a French company, contributing FRF 742 thousand to the shareholders' equity. The Division is in the process of liquidating its investment in Haarmesstechnik, a German company. The Division's combined common stock comprises the common stock of those companies whose capital is not held by other companies within the Division. At December 31, 1995, the issued and outstanding share capital of these companies consists of the following:
- ------------------------------------------------------------------------------- NUMBER AMOUNT OF NOMINAL IN FRF SHARES VALUE THOUSAND - -------------------------------------------------------------------------------- TOTAL COMMON STOCK 118 445 - -------------------------------------------------------------------------------- SOFITAM EQUIPEMENT................................... 228 538 100 FRF 22 854 SOFITAM INTERNATIONAL................................ 827 500 100 FRF 82 750 SOGEN................................................ 54 000 100 FRF 5 400 SOFITAM PUMP SERVICES................................ 356 750 1 GBP 3 107 Other entities....................................... (1) (1) 4 334 - --------------------------------------------------------------------------------
(1) African subsidiaries in Tunisia, Morocco, Cameroon and Senegal
NOTE 9--PROVISIONS FOR CONTINGENCIES AND CHARGES - ------------------------------------------------------------------------------------ Dec. 31, Dec. 31, (FRF thousands) 1995 1994 - ------------------------------------------------------------------------------------ Provision for warranty............................................. 3 129 3 306 Provision for restructuring........................................ 2 028 4 304 Provision for repairs.............................................. -- 1 396 Provision for employee claims...................................... 1 180 1 799 Provision for technical claims..................................... 5 611 2 959 Provision for foreign exchange loss................................ 784 -- Other.............................................................. 2 055 1 754 - --------------------------------------------------------------------------------- TOTAL PROVISION FOR CONTINGENCIES AND CHARGES.................. 14 787 15 518 - ---------------------------------------------------------------------------------
A provision for restructuring costs was made in 1995 in respect of the reorganization and rationalization of activities at Satam and Ein. 13 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 10--LONG-TERM BORROWINGS AND PARTICIPATING LOANS Analysis of movements in long-term borrowings and participating loans
- ------------------------------------------------------------------------------- DEC 31, NEW DEC 31, (in FRF thousands) 1993 LOANS REPAYMENTS OTHER 1994 - -------------------------------------------------------------------------------- . Participating loans................. 3 100 -- (876) 1 637 3 861 . Long-term borrowings................ 21 734 10 596 (11 591) 2 455 23 194 . Debt to SOFITAM SA.................. 188 473 3 357 (42 000) -- 149 830 . Other long-term debt................ 7 691 274 (584) (3 742) 3 639 - -------------------------------------------------------------------------------- TOTAL............................. 220 998 14 227 (55 051) 350 180 524 - --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------- DEC 31, NEW DEC 31, (in FRF thousands) 1994 LOANS REPAYMENTS OTHER 1995 - --------------------------------------------------------------------------------- . Participating loans.................... 3 861 -- -- (961) 2 900 . Long-term borrowings................... 23 194 2 963 (414) 357 26 100 . Debt to SOFITAM SA..................... 149 830 -- (75 105) -- 74 725 . Other long-term debt................... 3 639 4 (373) (37) 3 233 - --------------------------------------------------------------------------------- TOTAL................................ 180 524 2 967 (75 892) (641) 106 958 - ---------------------------------------------------------------------------------
In 1994, SOFITAM waived a debt of FRF 42 000 thousand from SOGEN, resulting in an exceptional profit of the same amount. In 1995, Sofitam converted its participating loan in Sofitam International, resulting in a capital increase of FRF 72 000 thousand. Other movements mainly relate to translation differences. Maturities of long-term debt
- ------------------------------------------------------------------------------- DEC 31, DEC 31, (in FRF thousands) 1995 1994 - -------------------------------------------------------------------------------- Due between 1 and 2 years....................................... 87 978 157 704 Due between 2 and 5 years....................................... 3 536 12 671 Due beyond 5 years or unlimited................................. 15 444 10 149 - -------------------------------------------------------------------------------- TOTAL....................................................... 106 958 180 524 - --------------------------------------------------------------------------------
Debt due between one and two years includes debt to SOFITAM SA of FRF 74 725 thousand, and FRF 149 830 thousand in 1995 and 1994, respectively, which is considered to be repayable in the coming year. In 1995, these debts to SOFITAM SA include an amount of FRF 7 981 thousand due by SOFITAM PUMP SERVICES, a UK company, that does not bear interest. NOTE 11--TRADE AND OTHER PAYABLES
- -------------------------------------------------------------------------------- DEC 31, DEC 31, (FRF thousands) 1995 1994 - -------------------------------------------------------------------------------- Trade payables.................................................. 144 375 141 687 Employee and social security liabilities........................ 43 985 21 573 VAT and other taxes............................................. 14 025 15 780 Deferred income................................................. 28 017 19 948 Other........................................................... 12 793 48 223 - -------------------------------------------------------------------------------- TOTAL AND OTHER PAYABLES.................................... 243 195 247 211 - --------------------------------------------------------------------------------
Deferred income corresponds primarily to advance billings by the French companies. 14 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 12--SHORT TERM BORROWINGS Short term borrowings include debt to SOFITAM SA of FRF 56 326 thousand and FRF 30 075 thousand in 1995 and 1994 respectively. In 1995, these debts to SOFITAM SA include an amount of FRF 1 281 thousand due by SOFITAM PUMP SERVICES, a UK company, that does not bear interest. NOTE 13--SALES - --------------------------------------------------------------------------------
(in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- France............................................... 644 207 520 852 520 980 Other countries...................................... 234 689 208 887 216 175 - -------------------------------------------------------------------------------- Total............................................ 878 896 729 739 737 155 - -------------------------------------------------------------------------------- NOTE 14--EXCEPTIONAL INCOME/(EXPENSE) - ------------------------------------------------------------------------------- (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- Waiver of debt from Sofitam.......................... -- 44 300 -- Restructuring costs.................................. (1 492) (6 926) -- Inventory write-downs provisions..................... (18 609) -- (2 071) Profit sharing....................................... (3 648) -- -- Write off of research and development costs.......... (1 744) -- -- Other................................................ 556 71 (621) - -------------------------------------------------------------------------------- EXCEPTIONAL INCOME/(EXPENSE), NET.................... (24 937) 37 445 (2 692) - --------------------------------------------------------------------------------
In 1993, Sogen made a provision of FRF 2 071 thousand against obsolete inventory. In 1994, Sofitam SA waived a debt of FRF 42 000 thousand due from Sogen, resulting in an exceptional profit of the same amount. In 1994 also, Bennett & Sauser received a debt waiver of FRF 2 300 thousand from its shareholders. In 1995, the Division reduced the valuation of SOGEN's and SOFITAM EQUIPEMENT's inventories to take account of revised expectations of the value of certain slow-moving spare parts. At the same time, certain inventories were scrapped. As a result, inventory write-down and provisions totaled FRF 18 609 thousand which have been included as an exceptional expense. In 1995, following the merger of EIN with SATAM, profit sharing for an amount of FRF 3 648 thousand in excess of the statutory requirements was paid to EIN's employees. This charge is included as an exceptional expense in the Division's profit and loss statement. In 1995, the Division changed its accounting treatment for research and development costs related to new products which were previously capitalized but are now expensed as incurred. The impact of the change in method was a charge of KF 1 744 thousand, recorded as an exceptional expense in 1995. 15 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 15--INCOME TAXES The provision for income taxes consists of the following: - -------------------------------------------------------------------------------
(in FRF thousands) 1995 1994 1993 - ------------------------------------------------------------------------------- French companies.................................... (11 019) (16 381) (5 248) Utilization of French companies' tax loss carryforwards...................................... 10 928 14 107 2 037 Foreign companies................................... (1 133) (851) (1 143) - ------------------------------------------------------------------------------- TOTAL CURRENT INCOME TAX EXPENSE................ (1 224) (3 125) (4 354) - ------------------------------------------------------------------------------- Temporary differences between the financial reporting and the tax bases of the Division's assets and liabilities, including unused tax loss carryforwards that could give rise to deferred tax assets, are as follows: - ------------------------------------------------------------------------------- (in FRF thousands) 1995 1994 1993 - ------------------------------------------------------------------------------- FRANCE.............................................. 37 407 75 078 163 925 - ------------------------------------------------------------------------------- Individual company level: -long-term capital loss carryforwards............. 4 309 4 309 4 309 -ordinary tax loss carryforwards.................. -- -- 83 955 -evergreen tax loss carryforwards................. 10 841 52 559 56 870 -accrued expenses not currently deductible for tax.......................................... 22 257 18 210 18 791 - ------------------------------------------------------------------------------- OUTSIDE FRANCE...................................... 37 076 45 324 43 506 - ------------------------------------------------------------------------------- TOTAL........................................... 74 483 120 402 207 431 - ------------------------------------------------------------------------------- As of December 31, 1995, the French companies of the Division had long-term capital loss carryforwards of FRF 4 309 that can be offset against long-term capital gains. The long-term capital loss carryforwards will expire progressively through the year 2000 if not utilized. The current tax rate on the long term capital loss carryforwards was increased by the French Government to 20.9% in 1995, compared with 19% in 1993 and 1994. The French companies of the Division also had loss carryforwards of FRF 10 841 at December 31, 1995 which may be carried forward indefinitely ("evergreen losses"). The current tax rate on these loss carryforwards was increased in 1995 by the French government to 36.66%, compared with 33.33% in 1993 and 1994. The Division also had net ordinary loss carryforwards of FRF 33 166 thousand in the United Kingdom and FRF 3 910 thousand in Spain at December 31, 1995. The utilization of these tax losses carryforwards is dependent on the future profitable operation of the Division in the tax jurisdictions in which the carryforwards arose. NOTE 16--EMPLOYEE INFORMATION - ------------------------------------------------------------------------------- 1995 1994 1993 - ------------------------------------------------------------------------------- Average no. of employees during the year............ 1 239 1 209 1 203 No. of employees at year-end........................ 1 260 1 218 1 199 - -------------------------------------------------------------------------------
16 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 17--COMMITMENTS UNDER CAPITAL LEASES - --------------------------------------------------------------------------------
DEC 31, DEC 31, DEC 31, (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- Original value of assets................................ 30 651 31 736 35 099 Depreciation for the year............................... 2 712 2 285 2 427 Accumulated depreciation................................ 13 096 10 384 10 049 Lease payments for the year............................. 4 364 4 690 5 095 Future minimum lease payments........................... 27 925 31 055 34 909 - --------------------------------------------------------------------------------
Assets acquired under capital leases relate mainly to the land and buildings at Tremblay which are the principal place of business of Sofitam Equipement. NOTE 18--PENSION COMMITMENTS Provision is not made for retirement benefits payable to the employees of the French companies, but these liabilities are disclosed as off-balance sheet commitments. These commitments are calculated on the basis of the age and accrued length of service of the employees concerned, and by taking account of their expected salary levels upon retirement and the probability that they will remain employees of the Division until retirement. The amounts payable are also calculated in accordance with the rules of the Collective Bargaining Agreement for the Metallurgical Industry. Retirement benefits payable to the employees of the foreign companies, where appropriate, are generally covered by pension funds. - --------------------------------------------------------------------------------
DEC DEC DEC 31, 31, 31, (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- Pension commitments........................................ 17 237 13 419 14 754 - --------------------------------------------------------------------------------
NOTE 19--OTHER COMMITMENTS - --------------------------------------------------------------------------------
DEC 31, DEC 31, DEC 31, (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- Bank guarantees......................................... -- 2 190 2 196 Factored receivables.................................... -- 2 410 11 000 Guarantees given on behalf of subsidiaries.............. -- 3 573 -- Other................................................... -- 2 837 -- - -------------------------------------------------------------------------------- TOTAL .............................................. -- 11 010 13 196 - --------------------------------------------------------------------------------
17 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 20--LIST OF COMBINED COMPANIES
PERCENTAGE COMPANY HEAD OFFICE COUNTRY INTEREST ------- ----------- ------- ---------- SOFITAM EQUIPEMENT.... 5, rue des Chardonnerets France 100% 93290 TREMBLAY-EN-FRANCE SOFITAM INTERNATIONAL. 41/43, rue des Bas France 100% 92600 ASNIERES SAM................... 5, rue des Chardonnerets France 100% 93290 TREMBLAY-EN-FRANCE SOGEN................. 41/43, rue des Bas France 100% 92600 ASNIERES BENNETT & SAUSER...... Fabrikstrasse n(degrees) 3, Switzerland 50% Tankanlagen 4530 SOLOTHURN 3 SOFITAM PUMP SERVICES. Adur Boatyard, Old Shoreham United Kingdom 51% Road SHOREHAM-BY-SEA, West Sussex BN43 5TA SOFITAM NV............ Mecheisesteenweg 313/315 Belgium 100% 1800 VILVOORDE PARKE PENRHYN......... 1, rue Fries Switzerland 100% 1701 FRIBOURG SOFITAM IBERICA....... Poligono Urvasa, Calle Spain 99% Norte, Nave 27 08130 Sta. Perpetua de Mogoda-- BARCELONE BENNETT FIMAC......... Quattordio Km 10800 SP 26 Italy 60% 14030 SCURZOLENGO (AT) MATAM................. 14, rue Rene Montanon Morocco 50% CASABLANCA COTTAM................ 116, Av. de l'Union du Tunisia 100% Maghreb Arabe B.P. 117--LA SOUKRA 2036 COSETAM............... B.P. 1237--DAKAR Senegal 99% COCITAM............... Bld de Marseille, Zone 4C-- Ivorian Coast 99% 1048 ABIDJAN SOCATAM............... B.P. 3941--DOUALA Cameroon 100% HAARMESSTECHNIK....... Gartnerstrasse 81d--25469 Germany 40% HALSTENBEK EXCELSIOR............. Rue de Belfort France 20% 25220 Roche-Les-Beaupre SOFITAM TANKTECHNIK... Am Neumarkt 30, Oslohaus Germany 100% 22041 HAMBURG
18 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 21--SUMMARY OF DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES FOLLOWED BY THE FUEL PUMP DIVISION OF SOFITAM AND THOSE APPLICABLE UNDER US GAAP The Division's accounting policies comply with accounting principles generally accepted in France ("French GAAP"). Those accounting policies which differ significantly from accounting principles generally accepted in the United States ("US GAAP") are described below. (a) Research and development costs In accordance with the option provided by French GAAP, the Division capitalized certain research and development costs in 1994. As described in Note 1, the Division changed its accounting treatment in respect of research and development costs in 1995. Costs of FRF 919 thousand incurred in 1995 were expensed and the remaining net book value of costs capitalized in 1994 of FRF 1 744 thousand was written off as an exceptional expense in 1995. Under US GAAP, these research and development costs would have been charged to operating income as incurred throughout the prior periods. (b) Purchased goodwill Under French GAAP, purchased goodwill may be retained on the balance sheet without amortization. As described in Note 1, the Division changed its accounting treatment for purchased goodwill in 1995 and started amortization over a 20 year period. Under US GAAP, goodwill must be amortized against income over a period not exceeding 40 years. In restating the combined financed statements to US GAAP, the estimated life of purchased goodwill is also 20 years. (c) Capital leases There is no obligation under French GAAP to capitalize fixed assets acquired through capital leases or long-term rental arrangements. Under US GAAP, capital leases are recorded at the beginning of the lease term as an asset and a liability at an amount equal to the present value of the minimum lease payments to be made during the lease term. The asset is amortized over its useful life. (d) Unrealized foreign exchange gains Under French GAAP, unrealized foreign exchange gains arising from the translation of foreign currency denominated payables or receivables are not recognized in the income statement. Under US GAAP, these gains are recognized as part of income. (e) Retirement indemnities In accordance with French legislation, the French companies have a defined benefit plan covering all employees at retirement. The plan provides for the payment of a lump sum retirement benefit. These payments are made upon retirement, but, if an employee leaves the Division prior to retirement age, the benefit lapses. 19 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 21--SUMMARY OF DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES FOLLOWED BY THE FUEL PUMP DIVISION OF SOFITAM AND THOSE APPLICABLE UNDER US GAAP (CONTINUED) Under French GAAP, there is no requirement to record any provision in respect of the liability to pay retirement indemnities but, if not provided, the liability must be disclosed as an off balance sheet commitment. Retirement indemnity commitments disclosed by the Division amount to FRF 17 237 thousand, FRF 13 419 thousand and FRF 14 754 thousand at December 31, 1995, 1994 and 1993 respectively. For the purpose of restating the combined financial statements to US GAAP, provision must be made for projected retirement indemnity commitments. Partial provision has been made in accordance with the terms of SFAS 87, which allows the required provision to be established over the period of the average remaining working lives of the employees concerned. Part of the required provision has been charged to equity at December 31, 1992, with a further part charged to income in the financial statements. The remaining service period of employees expected to receive benefits was estimated at the adoption date. The discount rates used in determining the actuarial present value of projected benefit obligations were 7 percent, 8 percent and 6 percent respectively for 1995, 1994 and 1993. The assumed rate of increase in future compensation levels used is 4 percent per annum. The funding status of the defined benefit plan for the Division was as follows : - -------------------------------------------------------------------------------
DEC DEC DEC 31, 31, 31, (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- Projected benefit obligation for services rendered to date.................................................. 17 237 13 419 14 754 Plan assets at market value............................ -- -- -- - -------------------------------------------------------------------------------- PROJECTED BENEFIT OBLIGATION IN EXCESS OF PLAN ASSETS.. 17 237 13 419 14 754 - -------------------------------------------------------------------------------- Unrecognized transition obligation..................... (5 308) (5 925) (6 542) Unrecognized actuarial gains/(losses).................. (1 990) (132) (3 604) - -------------------------------------------------------------------------------- NET ACCRUAL FOR RETIREMENT BENEFITS................ 9 939 7 362 4 608 - -------------------------------------------------------------------------------- The net benefit plan costs (credits) are comprised of : - -------------------------------------------------------------------------------- (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- Service cost........................................... 886 1 116 704 Interest cost on projected benefit obligations......... 1 074 885 818 Net amortization of unrecognized transition obligation. 617 617 617 (Gain)/losses.......................................... -- 136 -- - -------------------------------------------------------------------------------- NET PERIODIC PENSION EXPENSE....................... 2 577 2 754 2 139 - --------------------------------------------------------------------------------
20 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONTINUED) NOTE 21--SUMMARY OF DIFFERENCES BETWEEN ACCOUNTING PRINCIPLES FOLLOWED BY THE FUEL PUMP DIVISION OF SOFITAM AND THOSE APPLICABLE UNDER US GAAP (CONTINUED) (f) Waiver of debt In 1994, SOFITAM waived a debt of FRF 42 000 thousand due from SOGEN and BENNETT and SAUSER received a debt waiver of FRF 2 300 thousand from its shareholders. Under French GAAP, these debt waivers, totaling FRF 44 300 thousand, were treated as an exceptional profit in the accounts of the companies concerned. Under US GAAP, a debt waiver between a holding company and a subsidiary should be treated as a capital transaction and should not pass through the income statement. (g) Deferred income taxes Deferred taxes reflect the net tax effects of temporary differences between the bases used for financial reporting and income tax purposes. Significant components of the Division's deferred tax assets consist of the following :
- ------------------------------------------------------------------------------- DEC 31, DEC 31, DEC 31, 1995 1994 1993 - ------------------------------------------------------------------------------- FRANCE (1).......................................... 16 749 27 012 55 752 - ------------------------------------------------------------------------------- Ordinary loss carryforwards....................... -- -- 27 982 Evergreen loss carryforwards...................... 3 974 17 518 18 955 Long term capital loss carryforwards.............. 901 819 819 Profit sharing, not currently deductible for tax.. 2 854 316 606 Inventory provisions, not currently deductible for tax.............................................. 5 192 4 720 3 557 Restructuring costs, not currently deductible for tax.............................................. 113 1 034 2 100 Deferred taxes on pensions and similar obligations...................................... 3 644 2 454 1 536 Other............................................. 71 151 197 - ------------------------------------------------------------------------------- OUTSIDE FRANCE (2).................................. 12 977 16 473 15 227 - ------------------------------------------------------------------------------- Tax losses........................................ 12 977 15 863 15 227 Deferred taxes on research and development costs.. -- 610 -- - ------------------------------------------------------------------------------- TOTAL DEFERRED TAX ASSETS (1 + 2)............... 29 726 43 485 70 979 - ------------------------------------------------------------------------------- Less valuation allowance............................ (29 726) (43 485) (70 336) Deferred tax assets, net of valuation allowance..... -- -- 643 Deferred tax liabilities............................ -- -- (643) - ------------------------------------------------------------------------------- DEFERRED TAX ASSET, NET............................. -- -- -- - -------------------------------------------------------------------------------
No recognition has been made of deferred tax assets because, based on the information that would have been available at the end of each fiscal year and without the benefit of hindsight, their likelihood of realisation would not have appeared probable at the time. (h) Presentation of combined income statements The classification of certain items and the format of the Division's combined income statements presented under French GAAP differ in a number of ways from normal presentation under US GAAP. Under US GAAP income statement classification, exceptional items detailed in Note 14 would have been classified as a deduction from, or an addition to, income from operations. Employee profit sharing which is presented in a separate line item below income from operations under French GAAP, would also be classified as an operating expense under US GAAP. In addition, the format of the combined income statements under French GAAP is presented by nature of expense (personnel costs, depreciation, etc.). Under US GAAP, the format of the combined income statements would be presented by function of expense (cost of goods sold, selling, general & administration, etc.). 21 FUEL PUMP DIVISION OF SOFITAM S.A. NOTES TO THE AUDITED COMBINED FINANCIAL STATEMENTS--(CONCLUDED) NOTE 22--RECONCILIATION TO US GAAP (a) Net income
- -------------------------------------------------------------------------------- (in FRF thousands) 1995 1994 1993 - -------------------------------------------------------------------------------- GROUP INTEREST IN COMBINED NET INCOME................... 22 441 37 070 (1 238) Start up costs.......................................... 74 (316) -- Research and development costs.......................... 1 744 (1 744) -- Purchased goodwill...................................... 95 -- -- CAPITAL LEASE Interest expense...................................... (1 729) (1 848) (1 957) Depreciation and amortization......................... (1 062) (1 062) (1 062) Purchases used in production.......................... 3 049 3 049 3 049 Unrealized foreign exchange gains/(losses).............. 103 (285) -- Pension and similar obligations......................... (2 577) (2 754) (2 139) Waiver of debt.......................................... -- (44 300) -- Effect of reconciling items on minority interest........ 109 182 (773) - -------------------------------------------------------------------------------- NET INCOME ACCORDING TO US GAAP..................... 22 247 (12 008) (4 120) - --------------------------------------------------------------------------------
US GAAP adjustments are presented before tax and minority interests. There is no deferred tax impact of these adjustments because, as set out in Note 21 above, no net deferred tax assets nor liabilities have been recognised in the period. The impact of US GAAP adjustments on minority interests is separately identified in the above table. (b) Shareholders' equity
- -------------------------------------------------------------------------------- DEC 31, DEC 31, (in FRF thousands) 1995 1994 - -------------------------------------------------------------------------------- GROUP INTEREST IN THE SHAREHOLDERS' COMBINED EQUITY........... 55 039 (36 250) Start up costs................................................ (222) (316) Research and development costs................................ -- (1 744) Purchased goodwill............................................ (1 376) (1 479) CAPITAL LEASE Tangible fixed assets....................................... 17 838 18 900 Related long term debt...................................... (18 032) (19 352) Unrealized exchange gains..................................... 273 170 Pension and similar obligations............................... (9 939) (7 362) Reversal of Exceptional profit - debt waiver.................. -- (44 300) Capital contribution - debt waiver............................ -- 44 300 Effect of reconciling items on minority interest.............. 98 (11) - ------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY ACCORDING TO US GAAP................. 43 679 (47 444) - --------------------------------------------------------------------------------
US GAAP adjustments are presented before tax and minority interests. There is no deferred tax impact of these adjustments because, as set out in Note 21 above, no net deferred tax assets nor liabilities have been recognised in the period. The impact of US GAAP adjustments on minority interests is separately identified in the above table. 22 UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS The following unaudited pro forma condensed combined financial statements (the "Pro Forma Financial Statements") of the Company are derived from the unaudited interim financial statements of Tokheim and Sofitam (included elsewhere herein) and have been adjusted to illustrate the effects of the Transactions. The Pro Forma Financial Statements and accompanying notes should be read in conjunction with the consolidated financial statements of Tokheim and the combined financial statements of Sofitam, including the notes thereto, appearing elsewhere in this Prospectus. The pro forma statements of operations includes Sofitam's combined statement of operations for the year ended December 31, 1995 and the six months ended June 30, 1996 and Tokheim's consolidated statement of operations for the year ended November 30, 1995 and the six months ended May 31, 1996. The pro forma balance sheet includes Sofitam's combined balance sheet as of June 30, 1996 and Tokheim's consolidated balance sheet as of May 31, 1996. These pro forma statements give effect to the Transactions, including the Acquisition and related purchase accounting adjustments, as if the Transactions had taken place on December 1, 1994 for the statement of operations and May 31, 1996 for the balance sheet. Subsequent periodic financial information is unavailable because (i) Sofitam's practice has been to prepare interim financial statements only semi-annually and (ii) the Acquisition was completed on September 6, 1996, before the end of Sofitam's third quarter on September 30, 1996. The Pro Forma Financial Statements are not necessarily indicative of either future results of operations or the results that might have occurred if the foregoing Transactions had been consummated on the indicated dates. The Acquisition has been accounted for using the purchase method of accounting as such, Sofitam's equity has been eliminated in the pro forma condensed combined statements. The allocation of the aggregate purchase price included in the Pro Forma Financial Statements is preliminary. 23 PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS SIX MONTHS ENDED MAY 31, 1996 (DOLLARS IN THOUSANDS)
SOFITAM SOFITAM TOKHEIM FRENCH ADJUSTMENTS(1) AND U.S. U.S. PRO FORMA PRO FORMA GAAP(1) RECLASSIFICATIONS(2) GAAP GAAP ADJUSTMENTS COMBINED -------- -------------------- -------- -------- ----------- ------------ Net sales............... $ 89,260 $ -- $ 89,260 $107,167 $ -- $196,427 Operating expenses...... 80,680 768 81,448 104,410 -- 185,858 Special charges......... -- 332 332 -- -- 332 Depreciation and amortization........... 2,231 93 2,324 2,137 812(3) 5,273 -------- ------- -------- -------- -------- -------- Operating income........ 6,349 (1,193) 5,156 620 (812) 4,964 Interest expense, net... 2,102 156 2,258 1,466 5,323(4) 9,047 Other expense, net...... 454 (318) 136 (208) -- (72) Profit sharing.......... 782 (782) -- -- -- -- -------- ------- -------- -------- -------- -------- Earnings (loss) before income taxes.......... 3,011 (249) 2,762 (638) (6,135) (4,011) Income tax provision (benefit)............. 413 -- 413 (506) -- (93) -------- ------- -------- -------- -------- -------- Net earnings (loss)... $ 2,598 $ (249) $ 2,349 $ (132) $ (6,135) $ (3,918) ======== ======= ======== ======== ======== ======== Preferred stock dividends(5)........... $ 774 $ 774 Net loss applicable to Common Stock........... $ (906) $ (4,692) Primary loss per share.. $ (0.11) $ (0.59) ======== ======== Weighted average shares outstanding............ 7,938 7,938
24 PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS YEAR ENDED NOVEMBER 30, 1995 (DOLLARS IN THOUSANDS)
SOFITAM SOFITAM TOKHEIM FRENCH ADJUSTMENTS(1) AND U.S. U.S. PRO FORMA PRO FORMA GAAP(1) RECLASSIFICATIONS(2) GAAP GAAP ADJUSTMENTS COMBINED -------- -------------------- -------- -------- ----------- ------------ Net sales............... $177,450 $ -- $177,450 $221,573 $ -- $399,023 Operating expenses...... 160,273 1,503 161,776 210,960 -- 372,736 Special charges......... -- 4,294 4,294 -- -- 4,294 Depreciation and amortization........... 2,431 (172) 2,259 4,857 1,625(3) 8,741 -------- ------- -------- -------- -------- -------- Operating income........ 14,746 (5,625) 9,121 5,756 (1,625) 13,252 Interest expense, net... 3,820 349 4,169 3,319 10,947(4) 18,435 Other expense, net...... 5,290 (5,073) 217 (478) -- (261) Profit sharing.......... 863 (863) -- -- -- -- -------- ------- -------- -------- -------- -------- Earnings (loss) before income taxes.......... 4,773 (38) 4,735 2,915 (12,572) (4,922) Income tax provision... 247 -- 247 39 -- 286 -------- ------- -------- -------- -------- -------- Net earnings (loss)... $ 4,526 $ (38) $ 4,488 $ 2,876 $(12,572) $ (5,208) ======== ======= ======== ======== ======== ======== Preferred stock dividends(5)........... $ 1,580 $ 1,580 ======== ======== Net earnings (loss) applicable to Common Stock........... $ 1,296 $ (6,788) Primary earnings (loss) per share............. $ (0.16) $ (0.86) ======== ======== Weighted average shares outstanding............ 7,911 7,911
25 PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF MAY 31, 1996 (DOLLARS IN THOUSANDS)
PRO FORMA SOFITAM SOFITAM TOKHEIM COMBINED FRENCH U.S. U.S. PRO FORMA TOKHEIM & GAAP(6) ADJUSTMENTS(7) GAAP GAAP ADJUSTMENTS SOFITAM -------- -------------- -------- -------- ----------- ------------ ASSETS: Current assets: Cash and cash equivalents........... $ 8,140 $ -- $ 8,140 $ 2,005 $ (5,143) $ 5,002 Accounts receivable, net................... 61,821 42 61,863 37,531 -- 99,394 Inventory, net......... 36,637 -- 36,637 38,776 -- 75,413 Other current assets... -- -- -- 2,518 -- 2,518 -------- -------- -------- -------- -------- -------- Total current assets. 106,598 42 106,640 80,830 (5,143) 182,327 Property, plant & equipment, net......... 8,938 3,359 12,297 27,372 -- 39,669 Other noncurrent assets and deferred charges... 12,558 (10,586) 1,972 10,695 (3,296)(8) 9,371 Purchased goodwill and other intangibles...... -- -- -- -- 71,753 (9) 71,753 -------- -------- -------- -------- -------- -------- Total assets......... $128,094 $ (7,185) $120,909 $118,897 $ 63,314 $303,120 ======== ======== ======== ======== ======== ======== LIABILITIES & STOCKHOLDERS' EQUITY: Liabilities: Current liabilities: Current portion of long-term debt....... $ -- $ -- $ -- $ 441 $ (441)(11) $ -- Notes payable bank.... 38,281 -- 38,281 2,969 (41,250)(11) -- Accounts payable...... 37,472 -- 37,472 19,473 (3,000)(8) 53,945 Accrued expenses...... 14,792 -- 14,792 14,489 -- 29,281 Acquisition restructuring accrual 9,799 (10) 9,799 -------- -------- -------- -------- -------- -------- Total current liabilities......... 90,545 -- 90,545 37,372 (34,892) 93,025 Long-term debt (11)..... 20,223 -- 20,223 36,532 104,205 160,960 Capital lease obligations............ -- 3,359 3,359 -- -- 3,359 Postretirement benefits liability.............. -- -- -- 14,202 -- 14,202 Minimum pension liability.............. -- -- -- 3,868 -- 3,868 Minority interest....... 803 (16) 787 -- -- 787 Other long-term liabilities............ 3,225 2,210 5,435 717 -- 6,152 -------- -------- -------- -------- -------- -------- Total liabilities.... 114,796 5,553 120,349 92,691 69,313 282,353 ESOP Preferred Stock, net (13)............... -- -- -- 7,134 -- 7,134 Common stockholders' equity, net (13)....... 13,298 (12,738) 560 19,072 (5,999)(12) 13,633 -------- -------- -------- -------- -------- -------- Total liabilities & stockholders' equity.............. $128,094 $ (7,185) $120,909 $118,897 $ 63,314 $303,120 ======== ======== ======== ======== ======== ========
26 NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (DOLLARS IN THOUSANDS) (1) Sofitam's financial information contained in the pro forma condensed combined statement of operations has been derived from the audited combined financial statements for the year ended December 31, 1995 and unaudited combined financial statements for the six months ended June 30, 1996 prepared in accordance with French GAAP. Such financial information has been adjusted to comply with U.S. GAAP. Differences between French GAAP and U.S. GAAP are discussed in Note 21 to Sofitam's historical financial statements included elsewhere in this filing. The amounts included under "special charges" are reflected as exceptional expense under French GAAP and has been reclassified to special charges for purposes of the pro forma presentation under U.S. GAAP. The composition of this amount is discussed at Note (2) below. Certain classification assumptions have been made to allocate the adjustments discussed above among the various income statement captions. Amounts are converted into U.S. dollars based on an average rate of 5.113 French francs per U.S. dollar for the six months ended June 30, 1996 and an average rate of 4.958 French francs per U.S. dollar for the year ended December 31, 1995. (2) The following table summarizes the adjustments and reclassifications necessary to present Sofitam's French GAAP statement of operations on an U.S. GAAP basis. These items are discussed in more detail in Notes 14 and 21 to Sofitam's historical financial statements included elsewhere in this filing.
SIX MONTHS ENDED YEAR ENDED MAY 31, 1996 NOVEMBER 30, 1995 ---------------- ----------------- (DOLLARS IN THOUSANDS) (EXPENSE (INCOME)) Operating expenses: Reverse rent expense on capital lease recorded as operating lease under French GAAP.................. $(298) $ (615) Record additional pension related expenses not recognized under French GAAP........................ 283 520 Reclassification of pension related expenses from other expenses (non operating)......................... -- 736 Reclassification of pension related expenses from profit sharing (non operating)......................... 782 863 ----- -------- Total operating expenses.......... 768 1,503 ----- -------- Special charges: Reclassification of inventory write- down provision from other expenses (non operating).................... -- 3,753 Reclassification of research and development cost write off from other expenses (non operating)..... -- 352 Reclassification of restructuring charges from other expenses (non operating)......................... 102 301 Reclassification of other exceptional items from other expenses (non operating)........... 230 (112) ----- -------- Total special charges............. 332 4,294 ----- -------- Depreciation and amortization: Reverse amortization of deferred start up cost as amount was previously written off............. (4) (15) Reverse amortization of deferred research and development cost as amount was previously written off.. -- (352) Adjust amortization of purchased goodwill to conform with U.S. GAAP. (7) (19) Record depreciation expense on capital lease recorded as operating lease under French GAAP............ 104 214 ----- -------- Total depreciation and amortization..................... 93 (172) ----- --------
27 Interest expense, net Record interest expense on capital lease recorded as operating lease under French GAAP.................. 156 349 ----- -------- Other expense, net Reclassification of inventory write- down provision to special charges.. -- (3,753) Reclassification of research and development cost write off to special charges.................... -- (352) Reclassification of restructuring charges to special charges......... (102) (301) Reclassification of other exceptional items to special charges............................ (230) 112 Record unrealized exchange gains on trade accounts..................... 10 (21) Record effect of U.S. GAAP adjustments on minority interest... 3 (22) Reclassification of pension related expenses from other expenses (non operating)......................... -- (736) ----- -------- Total other expense, net.......... (318) (5,073) Profit Sharing: Reclassification of pension related expenses to operating expenses..... (782) (863) ----- -------- Total effect of all adjustments on income........................ $ 249 $ 38 ===== ========
(3) The pro forma adjustment represents the amortization of deferred costs and purchased goodwill associated with the Acquisition as follows:
ANTICIPATED SIX MONTH TWELVE MONTH GROSS AMORTIZATION PERIOD PERIOD AMOUNT PERIOD AMOUNT AMOUNT ------- ------------ --------- ------------ Purchased goodwill........................... $57,813 40 years $722 $1,445 Legal and advisory fees...................... 7,175 40 years 90 180 ------- ---- ------ $64,988 $812 $1,625 ======= ==== ======
(4) The pro forma adjustments to interest expense, net, were calculated as follows:
SIX MONTH YEAR ENDED ENDED MAY 31, NOVEMBER 30, 1996 1995 --------- ------------ Historical interest expense, net: Tokheim................................... $ 1,466 $ 3,319 Sofitam................................... 2,258 4,169 ------- ------- Total................................... 3,724 7,488 Plus: Interest expense on borrowings under: Borrowing under Bank Credit Facility ($33,344 at rates ranging from 8.14% to 10.0%)................................... 1,435 2,792 Senior Subordinated Notes due 2006 ($100,000 at 11.5%)....................... 5,750 11,500 ------- ------- Total................................... 7,185 14,292 Less: Interest expense on: Tokheim debt being refinanced............. (1,043) (2,474) Sofitam debt being refinanced............. (1,313) (2,279) ------- ------- Total................................... (2,356) (4,753) ------- ------- Sub total................................... 8,553 17,027 Amortization of deferred financing costs: Write off of old financing fees........... __ 420 Bank Credit Agreement..................... 319 638 Senior Subordinated Notes................. 175 350 ------- ------- Pro forma interest expense, net............. $ 9,047 $18,435 ======= =======
Interest expense, net, includes that portion of interest with respect to the Guaranteed ESOP Obligation which is not paid through dividends on, or redemptions of, the ESOP Preferred Stock. (5) Dividends are payable on the Company's ESOP Preferred Stock, the proceeds of which are used to service the Guaranteed ESOP Obligation. 28 (6) Sofitam's financial information contained in the pro forma condensed combined balance sheet has been derived from the unaudited interim combined financial statements of Sofitam prepared in accordance with French GAAP. Such financial information has been adjusted to comply with U.S. GAAP and to exclude the investment in Bennett Pump Company which is not being purchased by Tokheim as discussed in note 4 to Sofitam's historical financial statements included elsewhere in this filing. Differences between French GAAP and U.S. GAAP are discussed in Note 21 to Sofitam's historical financial statements included elsewhere in this filing. Certain classification assumptions have been made to allocate the adjustments discussed above among the various income statement captions. Amounts were converted into U.S. dollars based on exchange rate of 5.1520 French francs per U.S. dollar. (7) The following table summarizes the adjustments and reclassifications necessary to present Sofitam's French GAAP Balance Sheet on an U.S. GAAP basis. These items are discussed in more detail in Notes 14 and 21 to Sofitam's historical financial statements included elsewhere in this filing.
AS OF MAY 31, 1996 ---------------------- (DOLLARS IN THOUSANDS) Accounts receivable, Net Record unrealized exchange gains on trade accounts........................................ $ 42 Property, plant, and equipment, net................ Record items under capital leases accounted for as operating leases under French GAAP........... 3,359 Other non current assets and deferred charges Write off investment in Bennett Pump Company not being purchased................................. (10,286) Write off deferred start up cost................. (39) Write off purchased goodwill..................... (260) -------- (10,586) -------- Total adjustment to assets..................... $ (7,185) ======== Capital lease obligations Record capital lease obligations accounted for as operating leases under French GAAP.............. $ 3,359 Minority interest Record effect of U.S. GAAP adjustments on minority interest............................... (16) Other long-term liabilities Record pension and similar obligations not recorded under French GAAP...................... 2,210 Common stockholders' equity, net................... Record the effects on common stockholders' equity, net, of U.S. GAAP adjustments and the write off of the investment in Bennett Pump Company.......................................... (12,738) -------- Total adjustment to liabilities and stockholders' equity.......................... $ (7,185) ========
(8) This amount reflects the write-off of Tokheim's unamortized deferred financing costs of $420 related to previous debt being refinanced as part of the Transactions. In addition, this amount includes a $3,000 refund of the Purchase option security deposit. This amount was used as working capital to pay down accounts payable balance. (9) This amount reflects the excess of costs over the fair value of the net assets of Sofitam acquired pursuant to the Acquisition and the deferred costs associated with the Acquisition. 29 Total purchase price of Sofitam.................................. $107,423 Assumption of Sofitam debt..................................... 58,379 -------- Fair value of assets acquired.................................... 49,044 Plus adjustments: Interest on extension of purchase option..................... 180 -------- 49,224 Less Adjustments: Capital lease................................................ 643 Escrow future purchase of minority shares.................... 567 -------- Net Purchase Price of Equity..................................... 48,014 Book value of Sofitam net assets............................... 560 -------- Excess of cost over fair value of assets acquired................ 47,454 Deferred cost associated with the acquisition: Deferred financing fees........................................ 7,325 Legal and financial advisory fees.............................. 7,175 Direct Acquisition costs (See Note (10) below)................. 9,799 -------- Total goodwill and other intangibles............................. $ 71,753 ========
(10) Included in the goodwill amount are certain costs the Company believes will be spent to close down redundant operations in connection with the reorganization and rationalization of Sofitam's operations. The table below summarizes the deferred costs included in goodwill and accrued expenses as they relate to the redundancy plan for Sofitam. The amounts do not include costs associated with consolidation of previously existing Tokheim subsidiaries, which will be expensed as incurred, nor do these costs benefit production in future periods.
Item Amount Description ---- ------ -------------------------------------- Employee termination benefits....... $6,651 Approximately 300 employees (principally at 2 locations) Asset write-off and disposal cost... 2,108 Up to 10 locations Other plant closing cost............ 1,040 Leases and other contract terminations $9,799 ======
(11) This amount reflects the repayment of existing Tokheim and Sofitam debt with the proceeds of the offering of the Old Notes and borrowings under the Bank Credit Facility. Borrowings under the Bank Credit Facility........................ $ 33,344 Issuance of the Old Notes........................................ 100,000 Repay: Tokheim current portion of long-term debt...................... 441 Tokheim and Sofitam notes payable.............................. 41,250 Tokheim and Sofitam long-term debt............................. 29,139 -------- Net adjustment to reflect the financing transaction and the application of proceeds to repay existing debt.................. $ 62,514 ========
(12) The Company estimates future non-accruable restructuring charges related to the merger plan at approximately $3,043. In addition, normal operating charges associated with the plan, which will be expensed as incurred, are estimated at $2,100. These amounts have been aggregated (total consolidation plan non-accruable costs of $5,143) and shown as a reduction of cash and common stockholders' equity. The common stockholders' equity adjustment also includes $560 to eliminate Sofitam's existing net book value under the principles of consolidation and $420 reflecting the write- off of Tokheim's historical financing fees. (13) See consolidated financial statements for information as to the components of ESOP Preferred Stock, net, and common stockholders' equity, net. 30 -----END PRIVACY-ENHANCED MESSAGE-----