10-Q 1 q32001.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q (Mark One) (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 31, 2001 Commission File Number 1-6018 TOKHEIM CORPORATION (Exact Name of Registrant as Specified in its Charter) INDIANA 35-0712500 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 10501 CORPORATE DRIVE, FORT WAYNE, IN 46845 (Address of Principal Executive Offices) (Zip Code) (Registrant's Telephone Number Including Area Code): (219) 470-4600 NOT APPLICABLE (Former Name, Former Address, and Former Fiscal Year if Changed Since Last Report) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes (X) No Indicate by check mark whether the Registrant has filed all reports required to be filed by Section 12, 13 or 15 (d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes (X) No As of August 31, 2001, 3,842,925 shares of voting common stock were outstanding. The exhibit index is located on page 15. Item 1. Financial Statements
TOKHEIM CORPORATION & SUBSIDIARIES ------------------------------------------------------------------------------------------------------------------------- Consolidated Condensed Statement of Operations (Amounts in thousands except data per share) Unaudited ------------------------------------------------------------ Successor Predecessor Successor Predecessor Company Company Company Company ------------------------------------------------------------ Three months ended Nine months ended August 31, August 31, 2001 2000 2001 2000 ------------------------------------------------------------ Net sales $ 112,906 $ 122,668 $ 355,932 $ 389,917 Cost of sales, exclusive of items listed below 89,893 95,933 279,809 306,147 Selling, general, and administrative expenses 19,142 19,829 59,103 70,005 Depreciation and amortization 8,138 5,867 25,092 18,451 Merger and acquisition costs and other unusual items 1,554 13,146 4,504 18,594 --------------- ------------ ----------- ----------- Operating loss (5,821) (12,107) (12,576) (23,280) Interest expense, net 8,919 15,103 26,975 44,625 Foreign currency (gain) loss (487) 650 20 453 Minority interest in subsidiaries (26) 12 156 61 Other (income) expense, net 327 553 (1,666) (455) --------------- ------------ ----------- ----------- Loss before reorganization costs and income taxes (14,554) (28,425) (38,061) (67,964) Reorganization costs - 1,450 - 1,450 --------------- ------------ ----------- ----------- Loss before income taxes (14,554) (29,875) (38,061) (69,414) Income tax expense (benefit) 147 321 1,041 (1,362) --------------- ------------ ----------- ----------- Net loss (14,701) (30,196) (39,102) (68,052) Preferred stock dividends (372) (382) (1,122) (1,150) --------------- ------------ ----------- ----------- Loss applicable to common stock $ (15,073) $ (30,578) $ (40,224) $ (69,202) =============== ============ =========== =========== Loss per common share: Basic Net loss $ (3.35) $ (2.41) $ (8.94) $ (5.46) =============== ============ =========== =========== Weighted average shares outstanding* 4,500 12,669 4,500 12,669 =============== ============ =========== =========== Diluted Net loss $ (3.35) $ (2.41) $ (8.94) $ (5.46) =============== ============ =========== =========== Weighted average shares outstanding* 4,500 12,669 4,500 12,669 =============== ============ =========== =========== *4,500 shares to be issued upon the exchange of the old Tokheim securities. The accompanying notes are an integral part of the financial statements.
TOKHEIM CORPORATION & SUBSIDIARIES ------------------------------------------------------------------------------------------------------------------------ Consolidated Condensed Balance Sheet (Amounts in thousands except data per share) Successor Company ---------------------------------------- Unaudited August 31, 2001 November 30, 2000 ------------------ ------------------ Assets Current assets: Cash and cash equivalents $ 10,862 $ 8,946 Accounts receivable, net 111,406 110,820 Inventories: Raw materials, service parts and supplies 62,418 57,498 Work in process 13,616 12,497 Finished goods 8,698 8,485 ------------------ ------------------ 84,732 78,480 Other current assets 15,931 9,767 ------------------ ------------------ Total current assets 222,931 208,013 Property, plant and equipment, net 65,540 72,024 Reorganization value in excess of amounts allocable to identifiable assets, net 149,194 161,401 Intangible assets, net 13,039 9,496 Other assets 8,884 10,927 ------------------ ------------------ Total assets $ 459,588 $ 461,861 ================== ================== Liabilities and Shareholders' Equity Current maturities of other long term debt $ 2,115 $ 2,512 Cash overdrafts 17,224 12,061 Accounts payable 65,160 61,609 Accrued expenses 73,059 72,608 ------------------ ------------------ Total current liabilities 157,558 148,790 Notes payable, bank credit agreement 265,560 240,238 Other long term debt, less current maturities 2,583 2,988 Post-retirement benefit liability 19,319 18,880 Other long-term liabilities 2,121 1,164 ------------------ ------------------ 447,141 412,060 Redeemable convertible preferred stock, liquidation value of $25 per share, 1,700 shares authorized, 960 shares issued 13,019 12,619 New preferred stock, liquidation preference of $1 per share, 100 authorized and issued 100 100 Treasury stock, at cost (2,942) (2,494) ------------------ ------------------ Total preferred equity 10,177 10,225 New common stock, no par value; 30,000 shares authorized* 4,500 4,500 Common stock warrants 8,199 8,199 Accumulated comprehensive income (loss) 2,288 (623) Retained earnings (accumulated deficit) (39,793) 424 Additional paid in capital 27,076 27,076 ------------------ ------------------ Total common shareholders' equity 2,270 39,576 ------------------ ------------------ Total liabilities and shareholders' equity $ 459,588 $ 461,861 ================== ================== *4,500 shares to be issued upon the exchange of the old Tokheim securities. The accompanying notes are an integral part of the financial statements.
TOKHEIM CORPORATION & SUBSIDIARIES ---------------------------------------------------------------------------------------------------------------------------- Consolidated Condensed Statement of Cash Flows (Amounts in thousands except data per share) Unaudited -------------------------------------------- Successor Predecessor Company Company --------------------- -------------------- Nine months ended Nine months ended August 31, 2001 August 31, 2000 --------------------- -------------------- Cash flows from operating activities: Net loss........................................................ $ (39,102) $ (68,052) Adjustments to reconcile net loss to net cash used in operating activities: Payment in kind interest.................................. 12,910 4,175 Amortization of debt issuance costs....................... 1,049 - Depreciation and amortization............................. 25,092 18,451 (Gain) loss on sale of fixed assets....................... (732) 29 Deferred income taxes..................................... 547 - Changes in assets and liabilities: Receivables, net.......................................... 2,693 51,839 Inventories............................................... (4,855) 7,937 Other current assets...................................... (5,580) (2,047) Accounts payable.......................................... 1,879 (18,996) Accrued expenses.......................................... 301 (14,296) Other..................................................... 1,958 3,144 --------------- -------------- Net cash used in operating activities................................. (3,840) (17,816) --------------- --------------- Cash flows from investing activities: Property, plant, and equipment additions.................. (7,582) (7,486) Proceeds from the sale of property, plant, and equipment.. 1,720 1,098 Other..................................................... (465) - --------------- -------------- Net cash used in investing activities................................. (6,327) (6,388) --------------- --------------- Cash flows from financing activities: Increase (decrease) in other debt......................... (998) 191 Net increase in notes payable, banks...................... 11,363 15,956 Borrowings under DIP financing............................ - 5,000 Net increase in cash overdraft............................ 4,657 3,866 Debt issuance costs....................................... - (2,324) Other..................................................... (48) (97) Preferred stock dividends................................. (1,122) (1,150) --------------- ---------------- Net cash provided from financing activities........................... 13,852 21,442 --------------- ---------------- Effect of translation adjustments on cash............................. (1,769) 3,314 Increase in cash and cash equivalents................................. 1,916 552 Cash and cash equivalents: Beginning of period....................................... 8,946 14,437 -------------- ---------------- End of period............................................. $ 10,862 $ 14,989 ============== ================ The accompanying notes are an integral part of the financial statements.
Notes to the Consolidated Condensed Financial Statements 1. Basis of Presentation All dollar amounts presented are in thousands, except for per share data. The consolidated condensed financial statements are unaudited for the periods indicated herein, except for the November 30, 2000 balance sheet. In accordance with the rules and regulations of the Securities and Exchange Commission, certain information and footnote disclosures have been condensed or omitted; therefore, such financial statements should be read in conjunction with the consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended November 30, 2000. The consolidated financial statements include the accounts of Tokheim Corporation and its wholly and majority-owned subsidiaries ("Tokheim" or the "Company"). The consolidated condensed financial statements in this Report reflect all adjustments and accruals that, in the opinion of management, are necessary for a fair presentation of the results for the interim periods presented; all such adjustments were of a normal recurring nature. The results of operations for the three and nine month periods ended August 31, 2001 are not necessarily indicative of the results of operations for the year ending November 30, 2001. Tokheim (the "Predecessor Company") filed a Joint Prepackaged Plan of Reorganization (the "Plan") for the Company and its U.S. subsidiaries pursuant to Chapter 11 of the U.S. Bankruptcy Code with the U.S. Bankruptcy Court for the District of Delaware (the "Bankruptcy Court") on August 28, 2000. The Bankruptcy Court confirmed the Company's Plan on October 4, 2000, and the Plan became effective as of October 20, 2000 (the "Effective Date"). See Note 2 to the consolidated condensed financial statements for additional information. All discussion of events prior to the Effective Date refers to the Predecessor Company. The unaudited consolidated condensed financial statements prepared subsequent to the Effective Date reflect accounting principles and practices set forth in American Institute of Certified Public Accountants Statement of Position ("SOP") 90-7, Financial Reporting by Entities in Reorganization under the Bankruptcy Code, which provides guidance for financial reporting by entities that have filed voluntary petitions for relief under, and have reorganized in accordance with, the Bankruptcy Code. As such, the Company adopted "fresh start accounting" as of October 31, 2000. The Company's emergence from Chapter 11 proceedings resulted in a new reporting entity. Accordingly, the accompanying condensed consolidated Statements of Earnings and Cash Flows for periods prior to the Predecessor Company's emergence from bankruptcy are not comparable to the Statements of Earnings and Cash Flows of the Company subsequent to emergence from bankruptcy and the adoption of fresh start accounting (the "Successor Company"). 2. Plan of Reorganization The Plan provided that, among other things, (i) the existing bank credit agreement was restructured to comprise a four year, eleven month senior term facility of $137,177 and a four year, eleven month special facility of $100,000 on which interest will be accrued but not paid until at least November 30, 2002; (ii) the Company's bank group provided, in addition to the $237,177 facilities detailed above, a post-petition credit agreement (the "DIP Agreement") facility with available borrowings of $47,765 which was converted into a revolving credit facility upon the Company's emergence from the reorganization; (iii) members of the bank group received Series A Warrants with a five year term to purchase 678,334 shares of the Company's new common stock, no par value (the "New Common Stock") at an exercise price of $0.01 per share and Series A Preferred Stock with a total liquidation preference of $100, quarterly dividends at the rate of 16% per annum, and the right to elect two directors to the Company's Board of Directors (and to elect a majority of the directors upon certain defaults under the credit agreement); (iv) in exchange for their Notes, the holders of approximately $190,438 of senior subordinated notes and certain other unsecured creditors received 4,410,000 shares of New Common Stock representing approximately 85% of the equity value of the reorganized Company, subject to dilution for warrants to existing shareholders and management options; (v) in exchange for their Notes, the holders of $49,195 of junior subordinated notes received 90,000 shares of New Common Stock representing approximately 2% of the equity value of the reorganized Company, subject to dilution for warrants to existing shareholders and management options, and Series B Warrants giving them the right to acquire an aggregate of 555,556 shares of New Common Stock of the reorganized Company at an exercise price of $30.00 per share; (vi) the Company's employees' rights under the Retirement Savings Plan ("RSP") were preserved; and (vii) the Company's approximately 12,669,000 shares of previously outstanding common stock (the "Old Common Stock") were cancelled and existing holders of Old Common Stock received "out of the money" Series C warrants with a six year term giving them the right to acquire an aggregate of 549,451 shares of New Common Stock of the reorganized Company at an exercise price of approximately $49.46 per share (each Series C Warrant entitles the holder to purchase 0.04326865 of a share of New Common Stock at a price of $2.14, thereby requiring a holder to exercise approximately 23.111 Series C Warrants at an aggregate exercise price of approximately $49.46 to purchase one share of New Common Stock). 3. Notes Payable, Bank Credit Agreement In connection with the Chapter 11 proceedings discussed above, the Company entered into a post-confirmation credit agreement (the "New Credit Agreement") as of the Effective Date, which replaced all then-existing credit agreements. The New Credit Agreement comprises a four-year, eleven month revolving credit facility and three four-year, eleven month term facilities: the Tranche A Term Loan, the Tranche B Term Loan and the Special Loan. The revolving credit facility was in a maximum amount of $47,765 with availability based upon the amount of the Company's plant and machinery, inventory and receivables. Up to $5,000 of the facility may be utilized for the issuance of letters of credit, of which not more than $3,000 may be standby letters of credit. Borrowings under the revolving credit facility may be in U.S. Dollars or Euros, and bear interest based upon (at the Company's option) (i) the Base Rate (defined as the higher of (a) the prime rate and (b) the federal funds rate plus 0.5%) plus 2.5% in the case of U.S. Dollar denominated loans or (ii) the Eurodollar Rate (Reserve Adjusted) as defined in the New Credit Agreement plus 4% in the case of Euro denominated loans. The Tranche A Term Loan and the Tranche B Term Loan are in the amounts of $36,509 and $100,668, respectively, and bear interest based upon (at the Company's option) (i) the Base Rate (defined as the higher of (a) the prime rate and (b) the federal funds rate plus 0.5%) plus 3.5% in the case of U.S. Dollar denominated loans or (ii) the Eurodollar Rate (Reserve Adjusted) as defined in the New Credit Agreement plus 5% in the case of Euro denominated loans. On December 15, 2000, June 29, 2001 and July 31, 2001, the Company made principal prepayments of $915, $868 and $854, respectively, on the Tranche A Term Loan, bringing the outstanding balance to $33,872. These payments represent net proceeds from the sale of long term assets. The Special Loan is in the amount of $100,000 and bears interest at the rate of 16%, compounded quarterly, which is capitalized as part of the principal balance in lieu of being paid in cash. The loan is repayable in four annual installments of $25,000 plus capitalized interest thereon, commencing November 30, 2002. Any time an event of default (as defined in the New Credit Agreement) exists, the interest rates on the loans may be increased by 3%. In consideration for establishing the New Credit Agreement, the Company paid certain fees and expenses to the bank group and issued to them Series A Warrants to purchase 678,334 shares of New Common Stock of the Company at an exercise price of $0.01 per share. The Company also issued to the bank group New Preferred Stock with an aggregate liquidation preference of $100 and quarterly dividends at an annual rate of 16%. The holders of the New Preferred Stock are entitled to appoint two directors to the board of directors of the Company. In the event of a default under the New Credit Agreement, the holders of the New Preferred Stock, voting as a separate class, would be entitled to elect a majority of the directors on the board of directors of the Company. Indebtedness of the Company under the New Credit Agreement is secured by (i) a first perfected security interest in and lien on substantially all of the real and personal property assets of the Company's direct and indirect material majority-owned U.S. subsidiaries, (ii) a pledge of 100% of the stock of the Company's direct and indirect material majority-owned U.S. subsidiaries, and (iii) a pledge of 65% of the capital stock of the Company's first-tier material foreign subsidiaries and (b) was guaranteed by all of the Company's direct and indirect material majority-owned U.S. subsidiaries. The Company may voluntarily prepay the loans, in whole or in part, without penalty except for the Special Loan, which carries a prepayment penalty if paid off prior to August 2002. The Company is also required to apply against the loans (i) all net cash proceeds from sales of assets, (ii) all insurance proceeds (with certain exceptions), (iii) all net proceeds from the sale or issuance of debt or equity (with certain exceptions) and (iv) a percentage of excess cash flow (as defined in the New Credit Agreement) for each fiscal year commencing with the year ending November 30, 2002. The New Credit Agreement required the Company to meet certain consolidated financial tests, including the maintenance of minimum levels of EBITDA, fixed charge coverage ratios and interest coverage ratios (all as defined in the New Credit Agreement), the maintenance of maximum senior debt and total debt leverage ratios, and maximum levels of capital expenditures. The New Credit Agreement also contains covenants which, among other things, limit the incurrence of additional indebtedness, payment of dividends, transactions with affiliates, asset sales, acquisitions, investments, mergers and consolidations, prepayments and amendments of other indebtedness, liens and encumbrances and other matters customarily restricted in such agreements. At May 31, 2001, the Company was in violation of two of its financial covenants under the bank credit agreement. The bank group permanently waived this violation and modified, or suspended, the requirement for compliance with, the financial covenants relating to the remainder of fiscal 2001 and the first three quarters of fiscal 2002. The Company agreed to reduce the total availability under the revolving facility from $47,765 to $35,000. This reduction of $12,765 represents a portion of that part of the facility for which the Company believes it will have no use in the immediate future. While the Company currently is in compliance with the adjusted covenants, its ability to remain in compliance in the future may be affected by events beyond its control. Therefore, there can be no assurance that the Company will satisfy such financial tests or that it will be able to obtain amendments to the New Credit Agreement, if so needed, to avoid default. In the event of default, the lenders could elect to declare all amounts borrowed under the New Credit Agreement to be due and payable immediately. At August 31, 2001, the aggregate amount outstanding under the revolving facility was $23,440, including $1,440 of outstanding letters of credit. This amount is classified as long-term debt as the Company has the ability (under the terms of the agreement) and the intent to finance this obligation beyond one year. Total availability under the revolving facility at August 31, 2001 was $35,000, of which $11,560 was unused. Any balances outstanding under the New Credit Agreement are repayable in full on September 20, 2005. 4. New Accounting Pronouncements Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities" was issued in June 1998. SFAS No. 133 establishes a new model for accounting for derivatives in the balance sheet as either assets or liabilities and measures them at fair value. Certain disclosures concerning the designation and assessment of hedging relationships are also required. Additionally, the Securities and Exchange Commission has issued Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition", that deals with principles of revenue recognition. The Financial Accounting Standards Board Emerging Issues Task Force ("EITF") has released Issue No. 00-10, "Accounting for Shipping and Handling Fees and Costs." EITF 00-10 creates a framework for accounting for shipping and handling fees and costs. The adoption of these statements as of November 1, 2000 had no material impact on the Company's financial statements. SFAS No. 141, "Business Combinations" and SFAS No. 142, "Goodwill and Other Intangible Assets" were issued in June 2001, effective for fiscal years beginning after December 15, 2001. Under the new rules, goodwill and other intangible assets deemed to have an indefinite useful life will no longer be amortized as charges to earnings. Instead, these intangible assets will be reviewed annually for impairment and adjusted to reflect the fair value. Any intangible asset having a quantifiable useful life will continue to be amortized over that period. The Company is currently assessing the impact that SFAS No. 141 and SFAS No. 142 will have on the consolidated financial statements. 5. Segment Reporting For the three and nine month periods ended August 31, 2001 and 2000, the Company had only one reportable industry segment-the design, manufacture and servicing of petroleum dispensing systems. The Company has two reportable operating segments: North America and Europe/Africa. The accounting policies of these segments are as described in the summary of significant accounting policies in the Company's Form 10-K for the year ended November 30, 2000. The Company evaluates the performance of each operating segment based upon income from operations before merger and acquisition costs and other unusual items. The Company's selling, general, and administrative expenses are charged to each segment based upon the operating segment where the costs are incurred. Segment results for the three and nine month periods ended August 31, 2001 and 2000 are summarized in the tables below. SEGMENT REPORTING Successor Company Three months ended North August 31, 2001 America (1) Europe/Africa Eliminations Consolidated --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Customer sales $ 34,644 $ 78,262 $ - $ 112,906 Intercompany sales 805 (184) (621) - Depreciation and amortization 3,625 3,557 956 8,138 Operating profit (loss), before merger and acquisition costs and other unusual items (8,494) 4,967 (740) (4,267) Total assets $ 529,074 $ 253,194 $ (322,680) $ 459,588 Predecessor Company Three months ended North August 31, 2000 America (1) Europe/Africa Eliminations Consolidated --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Customer sales $ 47,252 $ 75,416 $ - $ 122,668 Intercompany sales 1,428 267 (1,695) - Depreciation and amortization 3,055 2,812 - 5,867 Operating profit (loss), before merger and acquisition costs and other unusual items (1,368) 2,459 (52) 1,039 Total assets $ 591,718 $ 322,731 $ (339,860) $ 574,589 Successor Company Nine months ended North August 31, 2001 America (1) Europe/Africa Eliminations Consolidated --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Customer sales $ 124,009 $ 231,923 $ - $ 355,932 Intercompany sales 1,986 435 (2,421) - Depreciation and amortization 10,948 11,275 2,869 25,092 Operating profit (loss), before merger and acquisition costs and other unusual items (17,201) 11,877 (2,748) (8,072) Total assets $ 529,074 $ 253,194 $ (322,680) $ 459,588 Predecessor Company Nine months ended North August 31, 2000 America (1) Europe/Africa Eliminations Consolidated --------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Customer sales $ 148,057 $ 241,860 $ - $ 389,917 Intercompany sales 3,576 739 (4,315) - Depreciation and amortization 8,611 9,840 - 18,451 Operating profit (loss), before merger and acquisition costs and other unusual items (12,035) 7,555 (206) (4,686) Total assets $ 591,718 $ 322,731 $ (339,860) $ 574,589 (1) Includes corporate headquarters Reconciliation from segment information to consolidated statement of earnings:
Successor Predecessor Successor Predecessor Company Company Company Company ---------------------------------- ---------------------------------- ---------------------------------- ---------------------------------- Three months ended Nine months ended August 31, August 31, ---------------------------------- ---------------------------------- ---------------------------------- ---------------------------------- 2001 2000 2001 2000 ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Segment operating loss $ (4,267) $ 1,039 $ (8,072) $ (4,686) Merger and acquisition costs and other unusual items (1,554) (13,146) (4,504) (18,594) ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- Consolidated operating loss $ (5,821) $ (12,107) $ (12,576) $ (23,280)
6. Comprehensive Loss The table below summarizes comprehensive loss for the three and nine month periods ended August 31, 2001 and 2000.
Successor Predecessor Successor Predecessor Company Company Company Company -------------------------------------- ---------------------------------------- Three months ended Nine months ended August 31, August 31, 2001 2000 2001 2000 -------------------------------------- ---------------------------------------- Net loss $ (14,701) $ (30,196) $ (39,102) $ (68,052) Other comprehensive loss: Foreign currency translation adjustments 4,547 (7,675) 2,911 (18,607) ----------------- ------------------ ------------------- ------------------ Comprehensive loss $ (10,154) $ (37,871) $ (36,191) $ (86,659) ================= ================== =================== ==================
7. Restructuring Charges In 1998, the Company acquired the RPS division of Schlumberger ("RPS"). Included in accrued liabilities are certain costs the Company will incur to effect an integration and rationalization plan for the RPS operations. These costs represent involuntary termination and other closure costs in connection with closing redundant manufacturing and service operations. These accrued costs do not include costs associated with consolidation of previously existing Tokheim subsidiaries, which are expensed as incurred or separately accrued once all criteria for accrual are met, nor do these costs benefit future periods. The integration and rationalization plan was completed at November 30, 2000. The Company expects the final cash payments related to the integration and rationalization plan to be completed by the end of fiscal 2001. The table below summarizes the accrued liability activity by major category and initiative for the three and nine month periods ended August 31, 2001. Approximately $4,312 of the original liability was unused at October 31, 2000 and recorded as a reduction of goodwill. Charges to the accrual for the three month period ended August 31, 2001 amounted to approximately $910, entirely attributable to currency fluctuations.
November 30, Charges to May 31, Charges to August 31, 2000 Accrual 2001 Accrual 2001 -------------- ------------ ----------- -------------- -------------- Involuntary employee termination benefits............................ $ 1,122 $ (22) $ 1,100 $ (910) $ 190 -------------- ------------ ----------- -------------- -------------- Total accrued integration and rationalization costs............................... $ 1,122 $ (22) $ 1,100 $ (910) $ 190 ============== ============ =========== ============== ==============
During 1999, as a result of the continuing integration and rationalization of the RPS Division with other business units, the Company accrued approximately $2,700 as a charge to operations to establish an accrual for involuntary termination benefits and related costs for approximately 69 employees that served in primarily service and administration roles at various service facilities in France. This amount also included amounts for lease termination and other exit costs and was added to an amount of $340 that remained accrued at November 30, 1999 for pension payments due to retirees who formerly worked at the Company's Glenrothes, Scotland facility. The table below summarizes the accrued liability activity by major category and initiative for the three and nine month periods ended August 31, 2001.
November 30, Charges to May 31, Charges to August 31, 2000 Accrual 2001 Accrual 2001 -------------- ------------ ----------- -------------- -------------- Involuntary employee termination benefits........................... $ 341 $ (46) $ 295 $ (77) $ 218 Facility closure and other closure costs............................ 209 (67) 142 (33) 109 -------------- ------------ ----------- -------------- -------------- Total accrued integration and rationalization costs.............................. $ 550 $ (113) $ 437 $ (110) $ 327 ============== ============ =========== ============== ==============
The Company expects the final cash payments related to the finalization of these initiatives to be made during 2001. 8. Earnings per Share The Company presents two earnings per share ("EPS") amounts, basic and diluted. Basic EPS is calculated based on earnings available to common shareholders and the weighted average number of common shares outstanding during the reported period. Diluted EPS includes additional dilution from common stock equivalents, such as stock issuable pursuant to conversion of preferred stock or the exercise of stock options and warrants outstanding. The incremental shares from the conversion of preferred stock and exercise of stock options and warrants were not included in computing diluted EPS for the three and nine month periods ended August 31, 2001 and 2000, since the effect of such is antidilutive during periods when a loss from continuing operations is reported. For the three months ended August 31, 2001, the weighted average of potentially issuable common shares included 677,329 shares related to warrants issued to the bank group. For the nine months ended August 31, 2001, the weighted average of potentially issuable common shares included 676,796 shares related to warrants issued to the bank group. For the three months ended August 31, 2000, the weighted average of potentially issuable common shares included 787,707 shares of convertible preferred stock outstanding and 2,499,527 shares related to warrants issued to Schlumberger. For the nine months ended August 31, 2000, the weighted average of potentially issuable common shares included 787,707 shares of convertible preferred stock outstanding and 2,516,216 shares related to warrants issued to Schlumberger. Pursuant to the Plan, the Old Common Stock was cancelled and 4,500,000 shares of New Common Stock were to be issued and outstanding following the exchange of the junior and senior subordinated notes of the Old Tokheim. 9. Changes in Senior Management The Company intimated on March 29, 2001 that Douglas K. Pinner had announced his intention to step down as Chairman, President and Chief Executive Officer and that the Company was initiating a search for a new Chief Executive Officer. In conjunction with this decision, the Company's Board of Directors selected George A. Helland, Jr., an existing Board member, to serve as acting Chairman, President, and Chief Executive Officer while Tokheim conducted this search. In conjunction with this change in senior management, outstanding stock options issued to Douglas K. Pinner were cancelled, as the required vesting period had not passed. The terms of Mr. Pinner's separation agreement were finalized and all additional related liabilities were accrued in the quarter ended May 31, 2001. On September 7, 2001, the Company announced the appointment of John S. Hamilton as President and Chief Executive Officer, succeeding George A. Helland, Jr. Concurrently, Mr. Helland was appointed Chairman of the Board of Directors. 10. Fresh Start Accounting In connection with its emergence from bankruptcy, the Company adopted fresh start accounting, as of October 31, 2000, in accordance with the requirements of SOP 90-7. In applying "fresh start accounting", the value of the Successor Company was allocated to the Company's net assets in conformity with the guidance specified by Accounting Principles Board Opinion No. 16, Business Combinations. SOP 90-7 required a determination of the Company's reorganization value, representing the fair value of all of the Company's assets and liabilities, and an allocation of such values to the assets and liabilities based on their relative fair values with the excess of reorganization value over market values recorded as an intangible asset. As a result, the carrying values of the Company's assets and liabilities were adjusted to fair value as of October 31, 2000. Reorganization value in excess of amounts allocable to identifiable assets of approximately $162,757 was recorded at October 31, 2000 and is being amortized on a straight-line basis over ten years. The application of SOP 90-7 resulted in the creation of a new reporting entity having no retained earnings or accumulated deficit. For the purpose of executing the Plan, the reorganization equity value of the Successor Company was estimated to be $50,000, based in part on management's estimate of future operating results. The reorganization value necessarily assumes that the Successor Company will achieve its estimated future operating results in all material respects. If such results are not achieved, the value of the Successor Company that is ultimately realized could be materially different. The Plan had a significant impact on the financial statements of the Successor Company, including the creation of a new reporting entity upon emergence from bankruptcy through the application of fresh start accounting pursuant to SOP 90-7. Accordingly, the Company's post-reorganization balance sheets, statements of operations and statements of cash flows, which reflect the application of fresh start accounting, have not been prepared on a basis consistent with the pre-reorganization financial statements and are not comparable in all respects to the financial statements prior to the reorganization. For accounting purposes, the inception date of the Successor Company is deemed to be November 1, 2000. 11. Merger and Acquisition Costs and Other Unusual Items The components of merger and acquisition costs and other unusual items for the three and nine month periods ended August 31, 2001 and 2000 are as follows:
Three months ended Nine months ended August 31, August 31, ------------------------------- ------------------------------- 2001 2000 2001 2000 -------------- ------------- -------------- ------------- Employee compensation and expenses related to the Reorganization....................................... $ 1,016 $ 386 $ 3,219 $ 1,496 Lease cancellation and other facility expenses....... 50 60 145 175 Increased warranty and other product related costs... - 329 - 762 Legal and professional fees.......................... 14 23 40 344 Credit agreement fees................................ - - - 1,556 Reorganization....................................... 474 4,450 903 4,724 Litigation settlements............................... - 7,000 - 7,000 Other................................................ - 898 197 2,537 -------------- ------------- -------------- ------------- Total $ 1,554 $ 13,146 $ 4,504 $ 18,594 ============== ============= ============== ==============
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations General Tokheim Corporation, including its subsidiaries ("Tokheim" or the "Company"), is the world's largest manufacturer and servicer of electronic and mechanical petroleum dispensing systems. These systems include petroleum dispensers and pumps, retail automation systems (including point-of-sale ("POS") systems), dispenser payment or "pay-at-the-pump" terminals, replacement parts and upgrade kits. The Company provides products and services to customers in more than 80 countries. The Company is the largest supplier of petroleum dispensing systems in Europe, Africa, Canada, and Mexico, and one of the largest in the United States. The Company also has established operations in Asia and Latin America. Results of Operations The Company emerged from its Chapter 11 proceedings and adopted "fresh start accounting" as of October 31, 2000 (see Note 2 to the consolidated condensed financial statements). Therefore, the Company's financial statements after this date reflect a new reporting entity (the "Successor Company") and are not directly comparable to the financial statements of prior periods. The principal comparative differences between the three and nine month periods ended August 31, 2001 and 2000 relate to the impact of the changes to the Company's capital structure, changes in indebtedness, and the revaluation of the Company's assets and liabilities to reflect the reorganization value at the Effective Date. The changes primarily affect depreciation and amortization expense and interest expense in the Company's results of operations after the Effective Date. However, for the purposes of comparative analysis, the following discussion of the operating results of the Company compares the operating results of the three and nine month periods ended August 31, 2001 for the Successor Company and the results of the three and nine month periods ended August 31, 2000 for the Predecessor Company. The operations (net sales, gross margin, and selling, general and administrative expenses) of the Successor and Predecessor Companies were substantially similar and the comparison of those items is meaningful to the understanding of the business. Consolidated net sales for the three month period ended August 31, 2001 were $112,906 compared to $122,668 for the comparable 2000 three month period. Sales for North America decreased by 26.7% for the period to $34,644 in 2001 from $47,252 in 2000. This decrease was primarily due to a decline in the distributor (Jobber) channel. European and African sales increased by 3.8% to $78,262 in 2001 from $75,416 in 2000. This increase was primarily attributable to revenues resulting from the conversion of products to enable them to operate utilizing the Euro currency. Consolidated net sales for the nine month period ended August 31, 2001 were $355,932 compared to $389,917 for the comparable 2000 nine month period. Sales for North America decreased by 16.2% for the period to $124,009 in 2001 from $148,057 in 2000. This decrease was primarily due to a decline in the distributor (Jobber) channel. European and African sales decreased by 4.1% to $231,923 in 2001 from $241,860 in 2000. This decrease was entirely attributable to currency fluctuations. Gross margins as a percent of sales (defined as net sales less cost of sales, divided by net sales) decreased to 20.4% in the three month period ended August 31, 2001 from 21.8% in the 2000 three month period. For the nine month period ended August 31, gross margins as a percentage of sales decreased from 21.5% in 2000 to 21.4% in 2001. These decreases are primarily attributable to a higher percentage of low margin service business in the current quarter. Selling, general, and administrative ("SG&A") expenses have decreased from $19,829 in the three month period ended August 31, 2000 to $19,142 in the three month period ended August 31, 2001. SG&A expenses have decreased from $70,005 in the nine month period ended August 31, 2000 to $59,103 in the nine month period ended August 31, 2001. These decreases are due to headcount reductions in the current year and foreign currency fluctuations. SG&A expenses as a percent of sales for the three and nine month periods ended August 31, 2001 were 17.0% and 16.6%, respectively, compared to 16.2% and 18.0% in the three and nine month periods of 2000. These fluctuations in percentages of sales are due to the realization of the plan of integration and rationalization in prior years. Depreciation and amortization expense for the three and nine month periods ended August 31, 2001 was $8,138 and $25,092, respectively, in contrast with $5,867 and $18,451 in the comparable 2000 periods. These increases were primarily attributable to the reorganization of the Predecessor Company and the associated revaluation of fixed assets to fair value, which has resulted in higher depreciation expense for 2001. The Successor Company also recorded reorganization value in excess of amounts allocable to identifiable assets, which has a shorter amortization period than goodwill recorded by the Predecessor Company, resulting in higher levels of amortization. Merger and acquisition costs and other unusual items were $1,554 and $4,504 for the three and nine month periods ended August 31, 2001, respectively, compared to $13,146 and $18,594 for the same periods in 2000. This decrease is due to higher costs incurred in 2000 related to the plan of integration and rationalization, the reduction of professional fees related to the Plan and the write off of credit agreement fees related to prior credit agreements. Net interest expense for the three and nine month periods ended August 31, 2001 was $8,919 and $26,975, respectively, compared to $15,103 and $44,625 in the same periods of 2000. This decrease is primarily attributable to reduced debt levels resulting from the discharge of the Predecessor Company's senior and junior subordinated notes. Foreign currency gain for the three month period ended August 31, 2001 was $487, compared with a loss of $650 in the same period of 2000. Foreign currency losses for the nine month periods ended August 31, 2001 and 2000, respectively were $20 and $453. Other expense, net for the three month period ended August 31, 2001 was $327, compared to $553 in the same period of 2000. Other income, net for the nine month periods ended August 31, 2001 and August 31, 2000 was $1,666 and $455, respectively. This increase was due to proceeds from life insurance policies and the reduction in estimates of certain liabilities, such as foreign Value Added Tax. Reorganization costs were $1,450 in the three and nine month periods ended August 31, 2000, which consisted of fees related to the debtor in possession financing. Income tax for the three month periods ended August 31, 2001 and 2000 was an expense of $147 and $321, respectively. Income tax expense of $1,041 was recognized in the nine month period ended August 31, 2001 and a benefit of $1,362 was recognized in the nine month period ended August 31, 2000. Due to decreases in state and local taxes, tax expense decreased for the three month period. Increases in the nine month period are related to profits earned in foreign tax jurisdictions. As a result of the above mentioned items, loss applicable to common stock of the Successor Company was $15,073 or $3.35 per diluted common share for the three months ended August 31, 2001, compared to a loss applicable to common stock of the Predecessor Company of $30,578 or $2.41 per diluted common share for the same period in 2000. Loss applicable to common stock of the Successor Company was $40,224 or $8.94 per diluted common share for the nine months ended August 31, 2001, compared to a loss applicable to common stock of the Predecessor Company of $69,202 or $5.46 per diluted common share for the same period in 2000. Liquidity and Capital Resources Cash used in operations for the nine month period ended August 31, 2001 was $3,840 versus cash used in operations of $17,816 in the same period of 2000. This decrease was caused principally by a decrease in the net loss from $68,052 in the nine month period ended August 31, 2000 to $39,102 in the nine month period ended August 31, 2001, partially offset by a lower level of working capital reduction achieved in the current year. Cash used in investing activities for the nine month period ended August 31, 2001 was $6,327 compared to a cash usage of $6,388 in the same period of 2000. Cash provided from financing activities for the nine month period ended August 31, 2001 was $13,852 compared to cash provided in the same 2000 period of $21,442. The cash provided in the 2001 period reflects a reduced level of borrowings from the Company's revolving credit facility. The Reorganization The Company's Chapter 11 reorganization became effective as of October 20, 2000. Under the Plan: o the holders of approximately $190,438 of senior subordinated notes and other unsecured creditors will receive, assuming a full exchange, 4,410,000 shares of New Common Stock representing approximately 85% of the equity value of the reorganized Company subject to dilution for warrants to existing shareholders and management options; o the holders of approximately $49,194 of junior subordinated notes will receive, assuming a full exchange, 90,000 shares of New Common Stock representing approximately 2% of the equity value of the reorganized Company, as well as Series B Warrants to acquire 555,556 shares of New Common Stock at an exercise price of $30.00 per share; o members of the bank group received Series A Warrants to acquire 678,334 of New Common Stock at an exercise price of $0.01 per share; o members of the bank group received Series A Senior Preferred Stock with an aggregate liquidation preference of $100 and dividends with an annual rate of 16%. The Company also entered into a New Credit Agreement as of the Effective Date. A portion of the proceeds from these facilities was used to repay all outstanding borrowings under the Company's bank loans. The New Credit Agreement, totaling $284,942, consisted of: o Tranche A Term Loan in an amount of $36,509 due in September 2005; o Tranche B Term Loan in an amount of $100,668 due in September 2005; o Special Loan in an amount of $100,000 due in four annual installments of $25,000 plus interest thereon, commencing in November 2002; o Revolving credit facility in an amount of $47,765 due in September 2005. The amount outstanding under the revolving credit facility at August 31, 2001 was $23,440. Interest rates on the new credit facilities are as follows: o the Tranche A and Tranche B Term Loans bear interest based upon (at the Company's option) (i) the Base Rate (defined as the higher of (a) the prime rate and (b) the federal funds rate plus 0.5%) plus 3.5% in the case of U.S. Dollar denominated loans or (ii) the Eurodollar Rate (Reserve Adjusted) as defined in the New Credit Agreement plus 5% in the case of Euro denominated loans; o the Special Loan bears interest at the rate of 16%, compounded quarterly, which is capitalized as part of the principal balance in lieu of being paid in cash; o the revolving credit facility bears interest based upon (at the Company's option) (i) the Base Rate (defined as the higher of (a) the prime rate and (b) the federal funds rate plus 0.5%) plus 2.5% in the case of U.S. Dollar denominated loans or (ii) the Eurodollar Rate (Reserve Adjusted) as defined in the New Credit Agreement plus 4% in the case of Euro denominated loans. On December 15, 2000, June 29, 2001 and July 31, 2001, as required under the terms of the loan agreement, the Company made principal prepayments of $915, $868 and $854, respectively, on the Tranche A Term Loan, representing net proceeds from the sale of long term assets. The Future The Company's principal sources for liquidity in the future are expected to be cash flow from operations and available borrowings under the New Credit Agreement. There can be no guarantee, however, that the Company's business will continue to generate cash flow at or above current levels, that estimated cost savings or growth will be achieved or that financial ratios and financial tests under the New Credit Agreement will be met or that the Company will be able to refinance its existing indebtedness in whole or in part. The Company's ability to meet financial ratios and tests in the future may be affected by events beyond its control. While the Company currently is in compliance with the covenants, there can be no guarantee that the Company will meet such financial ratios and tests in the future or that it will be able to obtain future amendments to the New Credit Agreement, if so needed, to avoid a default. In the event of a default, the lenders could elect to declare all amounts borrowed under the New Credit Agreement to be due and payable immediately. In addition, the New Credit Agreement limits the ability of the Company and its subsidiaries to, among other things: incur additional debt; pay dividends on capital stock or repurchase capital stock or make certain other restricted payments; use the proceeds of certain asset sales; make certain investments; create liens on assets to secure debt; enter into transactions with affiliates; merge or consolidate with another company; and transfer and sell assets. New Accounting Pronouncements In June 2001, the Financial Accounting Standards Board issues Statements of Financial Accounting Standards ("SFAS") No. 141, Business Combinations," and No. 142, "Goodwill and Other Intangible Assets." The Company is currently evaluating its intangible assets in relation to provisions of SFAS No. 141 and SFAS No. 142 to determine the impact, if any, their adoption will have on its results of operations and/or financial position. PART II. OTHER INFORMATION Item 1. Legal Proceedings On August 11, 2000, the Company settled out of court a claim asserted by the four former shareholders of Management Solutions, Inc. for an amount of $7,000. As a condition of the settlement, the award was treated as an impaired claim, similar to the treatment of the senior and junior subordinated notes in the bankruptcy proceeding. This award was accrued for and included as an impaired claim in the calculation of extraordinary gain on discharge of debt. These impaired claims were paid out in the form of common stock in the second quarter of 2001. In September 1998, the Company acquired the RPS Division ("RPS") of Schlumberger Limited ("Schlumberger"). One of Tokheim's primary competitors, Gilbarco, now known as Marconi, filed suit, claiming that a fuel dispenser manufactured by RPS violates its electronics design patent for fuel dispensers and its programmable multiple blender patent. Tokheim denied liability for any infringement of the patents and believes that this infringement breaches Schlumberger's warranty regarding ownership of the technology. Marconi filed suit in federal court in North Carolina. Marconi named Schlumberger as a Defendant in this lawsuit and Schlumberger failed to answer. Marconi moved for a summary judgement against Schlumberger. A settlement has been reached between Tokheim, Schlumberger and Marconi regarding this matter and approved by the Bankruptcy Court. Schlumberger agreed to pay a lump sum to Marconi. Tokheim and Marconi agreed to an allowed and liquidated claim in the bankruptcy proceeding. Marconi agreed to have its claim for infringement impaired in accordance with the distribution scheme contained in Tokheim's Plan. In addition, Tokheim will pay a royalty of $50.00 per blender on any blenders used in the Centurion product on or after November 30, 2000. Tokheim received a paid-up license with respect to the electronics design patent in question. On October 18, 2000, Schlumberger filed a claim with the Bankruptcy Court with respect to the Company's acquisition of RPS. The claim, which was subsequently modified on January 12, 2001, is for various sums allegedly due to Schlumberger, totaling $10,000. The Company believes that $6,507 of the claim is valid and had previously provided for that amount. For accounting purposes, the $6,507 has been treated similarly to the claims of other impaired unsecured creditors. The Company has not paid this claim as it has a counter-claim against Schlumberger for amounts due and alleged to be due to the Company on account of Schlumberger's material breach of various representations and warranties in connection with the acquisition. The amount of the Company's claim is in excess of $50,000. The Company has commenced arbitration proceedings before the International Court of Arbitration in Paris, France. Schlumberger has filed its answer and this matter is pending before the International Court of Arbitration in Paris. As more fully described in Note 21 to the consolidated financial statements, "Contingent Liabilities," in the Company's Form 10-K, the Company is defending one claim, in which it is a de minimus party, and legal actions, including claims relating to the U.S. Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA") and other environmental laws, product liability and various contract and employee matters, some of which may have been impaired in the bankruptcy proceeding. These legal actions primarily involve claims for damages arising out of the Company's manufacturing operations, product liability and various contractual and employment issues. Management believes that the outcome of such pending claims will not, individually or in the aggregate, have a material adverse effect on the Company's financial position, results of operations, or cash flows. Item 6. Exhibits and Reports on Form 8-K a. Exhibits Exhibit No. Document ------- -------- 2.1 Filing of a Joint Prepackaged Plan of Reorganization for the Company and its U.S. subsidiaries pursuant to Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Delaware (incorporated herein by reference to the Company's Current Report on Form 8-K/A dated September 11, 2000). 2.2 Confirmation of the Joint Prepackaged Plan of Reorganization for the Company and its U.S. subsidiaries pursuant to Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Delaware (incorporated herein by reference to the Company's Current Report on Form 8-K dated October 16, 2000). 3.1 Amended and Restated Articles of Incorporation of Tokheim Corporation, as filed with the Indiana Secretary of State as of October 20, 2000 (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 3.2 Amended and Restated Bylaws of Tokheim Corporation, as amended and restated as of October 20, 2000 (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 4.1 Post-Confirmation Credit Agreement, dated as of October 20, 2000, among Tokheim Corporation, various subsidiaries thereof as Borrowers, various financial institutions, AmSouth Bank, as Documentation Agent, and ABN AMRO Bank N.V., as Administrative Agent (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 4.2 Series A Warrant Agreement, dated as of October 20, 2000, among Tokheim Corporation and the holders of Series A Warrant Certificates (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 4.3 Series B Warrant Agreement, dated as of October 20, 2000, among Tokheim Corporation and Computershare Investor Services, LLC, as Warrant Agent (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 4.4 Series C Warrant Agreement, dated as of October 20, 2000, among Tokheim Corporation and Computershare Investor Services, LLC, as Warrant Agent (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 4.5 Registration Rights Agreement, dated as of October 20, 2000, among Tokheim Corporation and the Holders of Stock to be listed on Schedule 1 (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 4.6 First Amendment to the Credit Agreement, dated as of March 14, 2001, among Tokheim Corporation, various subsidiaries thereof as Borrowers, various financial institutions, AmSouth Bank, as Documentation Agent, and ABN AMRO Bank N.V., as Administrative Agent (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended February 28, 2001). 4.7 Second Amendment to the Credit Agreement, dated as of July 23, 2001, among Tokheim Corporation, various subsidiaries thereof as Borrowers, various financial institutions, AmSouth Bank, as a Lender and as Documentation Agent, and ABN AMRO Bank N.V., as a Lender and as Administrative Agent (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended May 31, 2001). 10.1 Tokheim Corporation Supplemental Executive Retirement Plan (incorporated herein by reference to the Company's Report on Form 10-Q, for the quarter ended August 31, 1999). 10.2 Employment Agreement, dated July 15, 1999, between Tokheim Corporation and Douglas K. Pinner (incorporated herein by reference to the Company's Report on Form 10-Q, for the quarter ended August 31, 1999). 10.3 Employment Agreement, dated May 15, 2000, between Tokheim Corporation and Robert L. Macdonald (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q/A, for the quarter ended May 31, 2000). 10.4 Employment Agreement, dated July 15, 1999, between Tokheim Corporation and Jacques St-Denis (incorporated herein by reference to the Company's Report on Form 10-Q, for the quarter ended August 31, 1999). 10.5 Employment Agreement, dated July 15, 1999, between Tokheim Corporation and Norman L. Roelke (incorporated herein by reference to the Company's Report on Form 10-Q, for the quarter ended August 31, 1999). 10.6 Employment Agreement, dated July 15, 1999, between Tokheim Corporation and Scott A. Swogger (incorporated herein by reference to the Company's Report on Form 10-Q, for the quarter ended August 31, 1999). 10.7 Technology License Agreement, effective as of December 1, 1997, between Tokheim Corporation and Gilbarco, Inc. (incorporated herein by reference to the Company's Annual Report on Form 10-K, for the year ended November 30, 1997). 10.8 Tokheim Corporation Management Option Plan (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 10.9 Form of Incentive Stock Option Agreement under Tokheim Corporation Management Option Plan (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). 10.10 Incentive Stock Option Agreement under Tokheim Corporation Management Option Plan, dated as of October 20, 2000, among Tokheim Corporation and Douglas K. Pinner (incorporated herein by reference to the Company's Quarterly Report on Form 10-Q, for the quarter ended August 31, 2000). b. Reports on Form 8-K None. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. TOKHEIM CORPORATION Date: October 12, 2001 /S/ ROBERT L. MACDONALD ------------------------------- Executive Vice-President, Finance and Chief Financial Officer Exhibit Index NONE