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 February 25, 1995
OR
___
___ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ___________________ to ______________________
Commission file number 1-6403
WINNEBAGO INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
IOWA 42-0802678
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P. O. Box 152, Forest City, Iowa 50436
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (515) 582-3535
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 ____.
There were 25,309,536 shares of $.50 par value common stock outstanding on April
6, 1995.
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
INDEX TO REPORT ON FORM 10-Q
<TABLE>
<CAPTION>
Page Number
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PART I. FINANCIAL INFORMATION: (Interim period information unaudited)
Consolidated Balance Sheets 1 & 2
Unaudited Consolidated Statements of Operations 3
Unaudited Consolidated Condensed Statements of Cash Flows 4
Unaudited Condensed Notes to Consolidated Financial Statements 5 & 6
Management's Discussion and Analysis of Financial Condition and Results
of Operations 7 - 9
PART II. OTHER INFORMATION 10 - 12
</TABLE>
PART I FINANCIAL INFORMATION
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
Dollars in thousands
<TABLE>
<CAPTION>
ASSETS FEBRUARY 25, AUGUST 27,
1995 1994
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ -- $ 847
Marketable securities 3,080 3,301
Receivables, less allowance for doubtful
accounts ($1,586 and $1,545, respectively) 33,270 36,602
Dealer financing receivables less allowance
for doubtful accounts ($348 and $279, respectively) 10,966 8,565
Prepaid income taxes 3,423 --
Inventories 66,704 55,450
Prepaid expenses 3,390 3,870
Deferred income taxes 6,581 2,252
Total current assets 127,414 110,887
PROPERTY AND EQUIPMENT, at cost
Land 1,568 1,539
Buildings 42,095 40,905
Machinery and equipment 76,311 75,139
Transportation equipment 7,930 7,985
127,904 125,568
Less accumulated depreciation 85,788 83,970
Total property and equipment, net 42,116 41,598
LONG-TERM NOTES RECEIVABLE, less allowances
($950 and $2,024, respectively) 4,076 4,884
INVESTMENT IN LIFE INSURANCE 16,177 15,479
NET DEFERRED INCOME TAXES 5,720 4,049
OTHER ASSETS 4,549 4,851
TOTAL ASSETS $ 200,052 $ 181,748
</TABLE>
See Unaudited Condensed Notes to Consolidated Financial Statements
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
Dollars in thousands
<TABLE>
<CAPTION>
FEBRUARY 25, AUGUST 27,
LIABILITIES AND STOCKHOLDERS' EQUITY 1995 1994
(Unaudited)
<S> <C> <C>
CURRENT LIABILITIES
Current maturities of long-term debt $ 2,028 $ 2,504
Notes payable 1,900 2,300
Accounts payable, trade 23,079 24,985
Accrued expenses:
Insurance 4,973 4,175
Product warranties 3,687 3,557
Vacation liability 3,412 3,241
Promotional 4,260 2,111
Other 8,852 9,491
Total current liabilities 52,191 52,364
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS 4,436 4,140
POSTRETIREMENT BENEFITS OTHER THAN
PENSIONS 44,316 43,391
MINORITY INTEREST IN CONSOLIDATED SUBSIDIARY 2,166 2,143
STOCKHOLDERS' EQUITY
Capital stock, common, par value $.50; authorized
60,000,000 shares 12,913 12,911
Additional paid-in capital 24,167 24,175
Reinvested earnings 66,440 49,270
103,520 86,356
Less treasury stock, at cost 6,577 6,646
Total stockholders' equity 96,943 79,710
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 200,052 $ 181,748
</TABLE>
See Unaudited Condensed Notes to Consolidated Financial Statements
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
IN THOUSANDS EXCEPT PER SHARE DATA
THIRTEEN WEEKS ENDED TWENTY-SIX WEEKS ENDED
February February February February
25, 26, 25, 26,
1995 1994 1995 1994
Revenues:
Manufactured products $ 111,270 94,251 235,728 193,840
Services 4,178 4,750 10,479 9,717
Total net revenues 115,448 99,001 246,207 203,557
Costs and Expenses:
Cost of manufactured products 95,314 82,290 202,315 167,806
Cost of services 2,723 2,736 6,196 5,623
Selling and delivery 6,594 6,220 12,672 12,246
General and administrative 5,747 6,365 12,024 12,779
Other expense 126 94 107 170
Minority interest in net income (loss)
of consol. subsidiary (123) 25 23 85
Total costs and expenses 110,381 97,730 233,337 198,709
Operating income 5,067 1,271 12,870 4,848
Financial income 1,018 10 824 175
Income from operations
before income taxes* 6,085 1,281 13,694 5,023
Provision (credit) for income taxes (6,000) -- (6,000) --
Income from operations* 12,085 1,281 19,694 5,023
Cumulative effect of change
in accounting principle -- -- -- (20,420)
Net income (loss) $ 12,085 1,281 19,694 (15,397)
Income (loss) per common share:
Income from operations* $ .48 .05 .78 .20
Cumulative effect of change
in accounting principle -- -- -- (.81)
Net income (loss) $ .48 .05 .78 (.61)
Weighted average number of
shares of common stock
outstanding 25,244 25,165 25,243 25,151
* BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE.
SEE UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Dollars in thousands
Increase (decrease) in cash and cash equivalents TWENTY-SIX WEEKS ENDED
February 25, February 26,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 19,694 $ (15,397)
Adjustments to reconcile net income (loss)
to net cash from operating activities:
Cumulative effect of change in accounting principle -- 20,420
Depreciation and amortization 4,084 3,831
Employee stock bonus plan -- 437
Deferred income taxes (6,000) --
Realized and unrealized gains on investments, net (282) (84)
Postretirement benefits other than pensions 925 2,253
Minority shareholders' portion of consolidated
subsidiary's gain 23 85
Other 783 (58)
Change in assets and liabilities:
Decrease (increase) in accounts receivable 4,008 (2,839)
Increase in inventories (11,254) (7,915)
Increase (decrease) in accounts payable and accrued
expenses 303 (5,653)
Increase in other categories, net (2,943) (828)
Net cash provided (used) by operating activities 9,341 (5,748)
Cash flows from investing activities:
Investments in marketable securities (1,937) (6,371)
Proceeds from the sale of marketable securities 2,440 5,935
Purchases of property and equipment (5,283) (4,980)
Investments in dealer receivables (18,717) (18,112)
Proceeds from dealer receivables 16,218 17,890
Investment in other assets and notes receivable (910) (2,040)
Other 642 397
Net cash used by investing activities (7,547) (7,281)
Cash flows from financing activities and capital transactions:
Net increase in notes payable -- 2,050
Payments of long-term debt and capital leases (880) (802)
Payments of cash dividends (2,524) --
Proceeds from issuance of long-term debt 700 777
Other 63 328
Net cash (used) provided by financing activities and
capital transactions (2,641) 2,353
Net decrease in cash and cash equivalents (847) (10,676)
Cash and cash equivalents - beginning of period 847 11,238
Cash and cash equivalents - end of period $ -- $ 562
</TABLE>
SEE UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. In the opinion of management, the accompanying unaudited consolidated
condensed financial statements contain all adjustments, consisting of
normal recurring accruals, necessary to present fairly the consolidated
financial position as of February 25, 1995, and results of operations and
cash flows for the 26 and 13 weeks ended February 25, 1995 and February
26, 1994.
2. The results of operations for the 26 weeks ended February 25, 1995, are
not necessarily indicative of the results to be expected for the full
year. Service revenues, in the Consolidated Statements of Operations,
consist of revenues generated by Cycle-Sat, Inc. (Cycle-Sat) and
Winnebago Acceptance Corporation (WAC), subsidiaries of the Company.
3. Inventories are valued at the lower of cost or market, with cost being
determined under the last-in, first-out (LIFO) method and market defined
as net realizable value.
Inventories are composed of the following (dollars in thousands):
February 25, August 27,
1995 1994
Finished Goods.................... $ 25,054 $ 21,675
Work In Process................... 15,255 13,807
Raw Materials..................... 40,857 33,800
81,166 69,282
LIFO Reserve...................... 14,462 13,832
$ 66,704 $ 55,450
4. Since March, 1992, the Company has had a $12,000,000 financing and
security agreement with NationsCredit Corporation (NationsCredit)
formerly Chrysler First Commercial Corporation. Terms of the agreement
limit borrowings to the lesser of $12,000,000 or 75% of eligible
inventory (fully manufactured recreation vehicles ready for delivery to a
dealer). Borrowings are secured by the Company's receivables and
inventory. The agreement requires a graduated interest rate based upon
the bank's reference rate as defined in the agreement. The line of credit
is available for a term of one year and continues during successive
one-year periods unless either party provides at least 90-days notice
prior to the end of the one-year period to the other party that they wish
to terminate the line of credit. The agreement prohibits any advances,
loans, or additional guarantees of any obligation to any subsidiary or
affiliate in excess of $5,000,000 or $7,500,000 in the aggregate for all
subsidiaries and affiliates from the date of the agreement. The agreement
also includes certain restrictive covenants including maintenance of
minimum net worth, working capital and debt to equity ratio. As of
February 25, 1995, the Company was in compliance with these covenants.
There were no outstanding borrowings under the line of credit at February
25, 1995 or August 27, 1994.
On January 31, 1995, the Company and Cycle-Sat amended the line of credit
with Firstar Bank Cedar Rapids (Firstar) originally dated February 24,
1994. Terms of the amended agreement limit the amount advanced to the
lesser of $4,500,000 or the sum of the base of 80 percent of Cycle-Sat's
eligible accounts receivable and 50 percent of its inventory. The
agreement contains restrictive covenants related to the maintenance of a
minimum tangible net worth and other operating and debt ratios as defined
in the agreement. As of February 25, 1995, Cycle-Sat was in compliance
with these covenants. Borrowings under the line of credit are secured by
Cycle-Sat's accounts receivable and inventories and have been guaranteed
by the Company. The line of credit expires February 1, 1996. The
outstanding balance under the line of credit at February 25, 1995 was
$1,900,000 with an interest rate of 7.8125 percent per annum (90-day
LIBOR plus 1.5 percent) and at August 27, 1994, $2,300,000 with an
interest rate of 9.0 percent per annum. As of February 25, 1995,
Cycle-Sat had $126,000 of unused borrowings available.
5. It is customary practice for companies in the recreation vehicle industry
to enter into repurchase agreements with lending institutions which have
provided wholesale floor plan financing to dealers. The Company's
agreements provide for the repurchase of its products from the financing
institution in the event of repossession upon a dealer's default. The
Company was contingently liable for approximately $151,550,000 and
$118,954,000 under repurchase agreements with lending institutions as of
February 25, 1995, and August 27, 1994, respectively. Included in these
contingent liabilities are approximately $51,654,000 and $36,231,000,
respectively, of certain dealer receivables subject to recourse
agreements with ITT Commercial Finance Corporation, NationsCredit and
John Deere Credit, Inc.
6. Fiscal year-to-date the Company paid cash for the following (dollars in
thousands):
Twenty-Six Weeks Ended
February 25, February 26,
1995 1994
Interest $ 605 $ 369
Income Taxes 3,914 1,418
7. At February 25, 1995, Postretirement Health Care and Deferred
Compensation Benefits included postretirement benefits related to health
care and other benefits of $23,762,000 and deferred compensation of
$20,554,000.
Net postretirement benefit cost for the 13 and 26 weeks ended February
25, 1995 consisted of the following components:
<TABLE>
<CAPTION>
Thirteen Twenty-Six
Weeks Weeks
<S> <C> <C>
Service cost - benefits earned during the period $ 261,000 $ 523,000
Interest cost on accumulated postretirement benefit obligation 293,000 586,000
Amortization of (gain)/loss (95,000) (190,000)
$ 459,000 $ 919,000
</TABLE>
8. At August 27, 1994, the Company had a valuation allowance of $15,400,000
related to its deferred tax assets due to uncertainty as to future
utilization of those assets. During 1995, the valuation allowance has
been reduced as income is earned. In addition, in the second quarter of
fiscal 1995, the Company recognized a tax benefit of $6,000,000 due to
continued trend of earnings which increased the likelihood that the
Company will realize its gross deferred tax assets in the future thus
eliminating the need for a portion of the valuation allowance. Future
changes in the valuation allowance will depend upon future operating
results.
A reconciliation of the expected income tax provision at Federal
statutory rates with the amount provided for the 13 and 26 weeks ended
February 25, 1995 is as follows (dollars in thousands):
Thirteen Twenty-Six
Weeks Weeks
U.S. Federal Statutory Rate $ 2,130 $ 4,793
Other (172) (159)
Reduction of Valuation Allowance (7,958) (10,634)
TOTAL $ (6,000) $ (6,000)
For the 13 and 26 weeks ended February 26, 1994, the tax expense
associated with the current income was equal to the reduction of the
valuation allowance.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Thirteen Weeks Ended February 25, 1995 Compared to Thirteen Weeks Ended February
26, 1994
Net revenues of manufactured products for the 13 weeks ended February 25, 1995
increased $17,019,000 or 18.1 percent from the 13 week period ended February 26,
1994. Motor home shipments increased by 261 units or 14.0 percent during the 13
weeks ended February 25, 1995 when compared to the second quarter of fiscal
1994. The growth in the Company's revenues is attributed to the excellent
acceptance of the Company's 1995 model year products. The Company is cautiously
optimistic about the outlook for the remainder of the 1995 fiscal year; however,
recent increases in interest rates by the Federal Reserve Board could have a
detrimental effect on the Company's revenue growth.
Service revenues for the 13 weeks ended February 25, 1995 decreased $572,000 or
12.0 percent from the 13 weeks ended February 26, 1994. This decrease can be
attributed to reduced revenues ($734,000 or 16.1 percent) by Cycle-Sat due to
weak movie promotion activity.
Cost of manufactured products, as a percent of manufactured product revenue, was
85.7 percent for the 13 weeks ended February 25, 1995 compared to 87.3 percent
for the 13 weeks ended February 26, 1994. This decrease can be attributed
primarily to the increase in motor home sales and production volume.
Cost of services, as a percent of service revenue, increased to 65.2 percent
from 57.6 percent when comparing the 13 weeks ended February 25, 1995 to the 13
weeks ended February 26, 1994. This increase in percentage can be attributed
primarily to the decrease in Cycle-Sat revenues.
Selling and delivery expenses increased by $374,000 but decreased to 5.7 percent
of net revenues from 6.3 percent of net revenues when comparing the 13 weeks
ended February 25, 1995 to the comparable period of fiscal 1994. The increase in
dollars can be attributed primarily to increases in advertising expenses. The
decrease in percentage can be attributed primarily to the increase in revenues.
General and administrative expenses decreased by $618,000 when comparing the 13
weeks ended February 25, 1995 to the 13 weeks ended February 26, 1994. The
decrease when comparing the two periods can be attributed primarily to a
reduction in the Company's cost for postretirement benefits offset partially by
increases in the Company's self-insurance reserves.
The Company had other expense of $126,000 during the 13 weeks ended February 25,
1995 compared to other expense of $94,000 during the 13 weeks ended February 26,
1994. The primary reason for the increase when comparing the two periods was the
increase during the current period in the Company's provision for losses on the
resale of motor homes repurchased by the Company under its repurchase agreements
with financial institutions offset partially by an increase in lease income from
the Company's public warehousing activities.
The Company had net financial income of $1,018,000 for the 13 weeks ended
February 25, 1995 compared to income of $10,000 for the comparable period of
fiscal 1994. The Company recorded $705,000 of realized and unrealized gains
compared to $15,000 of gains in its marketable securities portfolio during the
second quarters of fiscal 1995 and 1994, respectively. The Company recorded
$106,000 of net interest income during the 13 weeks ended February 25, 1995
compared to net interest expense of $36,000 during the comparable period of
fiscal 1994. Also recorded were foreign exchange gains of $207,000 and $31,000
for the 13 weeks ended February 25, 1995 and February 26, 1994, respectively.
The Company reported a $6,000,000 credit for income taxes during the quarter
ended February 25, 1995 due to an increased likelihood that it will be able to
realize a portion of its deferred tax assets in the future.
For the 13 weeks ended February 25, 1995, the Company reported net income of
$12,085,000 or $.48 per share which included a net loss of $487,000 ($.02 per
share) from Cycle-Sat operations. For the 13 weeks ended February 26, 1994, the
Company reported net income of $1,281,000 or $.05 per share which included
income of $99,000 from Cycle-Sat operations.
Twenty-Six Weeks Ended February 25, 1995 Compared to Twenty-Six Weeks Ended
February 26, 1994
Net revenues of manufactured products for the 26 weeks ended February 25, 1995
increased $41,888,000 or 21.6 percent from the 26 weeks ended February 26, 1994.
Motor home shipments increased by 613 units or 15.6 percent during the 26 weeks
ended February 25, 1995 when compared to the first half of fiscal 1994. This
growth in the Company's revenues is attributed to an excellent acceptance of the
Company's 1995 model year products.
Service revenues for the 26 weeks ended February 25, 1995 increased $762,000 or
7.8 percent from the 26 weeks ended February 26, 1994. This increase can be
attributed to an increase in revenues from established customers as well as
revenues generated with new customers by Cycle-Sat.
Cost of manufactured products, as a percent of manufactured product revenue, was
85.8 percent for the 26 weeks ended February 25, 1995 compared to 86.6 percent
for the 26 weeks ended February 26, 1994. This decrease can be attributed
primarily to the increase in motor home sales and production volume.
Cost of services, as a percent of service revenue, increased to 59.1 percent
from 57.9 percent when comparing the 26 weeks ended February 25, 1995 to the 26
weeks ended February 26, 1994. This increase in percentage can be attributed to
decreases in Cycle-Sat's revenues during the second quarter of fiscal 1995.
Selling and delivery expenses increased by $426,000 but decreased to 5.1 percent
of net revenues from 6.0 percent of net revenues when comparing the 26 weeks
ended February 25, 1995 to the comparable period of fiscal 1994. The increase in
dollars can be attributed primarily to increases in advertising expenses. The
decrease in percentage can be attributed primarily to the increase in revenues.
General and administrative expenses decreased by $755,000 when comparing the
first half of fiscal 1995 to the first half of fiscal 1994. The decrease when
comparing the two periods can be attributed primarily to a reduction in the
Company's cost for postretirement benefits offset partially by increases in the
Company's self-insurance reserves.
The Company had other expense of $107,000 during the 26 weeks ended February 25,
1995 compared to other expense of $170,000 during the 26 weeks ended February
26, 1994. The primary reason for the decrease when comparing the two periods was
an increase in lease income from the Company's public warehousing activities
offset partially by an increase in the current period of the Company's provision
for losses on the resale of motor homes repurchased by the Company under its
repurchase agreements with financial institutions.
The Company had net financial income of $824,000 for the 26 weeks ended February
25, 1995 compared to income of $175,000 for the comparable period of fiscal
1994. The Company recorded foreign exchange gains of $313,000 and $26,000 for
the 26 weeks ended February 25, 1995 and February 26, 1994, respectively.
Recorded during the 26 weeks ended February 25, 1995 was $282,000 of realized
and unrealized gains in the Company's marketable securities portfolio compared
to gains of $84,000 during the 26 weeks ended February 26, 1994. The Company,
also recorded $230,000 of net interest income during the first half of fiscal
1995 compared to net interest income of $65,000 during the first half of fiscal
1994.
For the 26 weeks ended February 25, 1995, the Company reported net income of
$19,694,000 or $.78 per share which included the aforementioned $6,000,000 tax
credit and income of $137,000 ($.01 per share) from Cycle-Sat operations. For
the 26 weeks ended February 26, 1994, the Company reported income from
operations of $5,023,000 or $.20 per share which included income of $340,000
($.01 per share) from Cycle-Sat operations.
In fiscal 1994, the Company was required to adopt the remaining portion of FASB
Statement No. 106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions" related to health care and other benefits. This change in accounting
principle resulted in a cumulative non-cash charge at the beginning of fiscal
1994 of $20,420,000 or $.81 per share. With the adoption on FASB No. 106, the 26
weeks ended February 26, 1994 net loss was $15,397,000 or $.61 per share.
LIQUIDITY AND FINANCIAL CONDITION
Presently, the Company meets its working capital and capital equipment
requirements and cash requirements of subsidiaries with funds generated
internally and funds from agreements with financial institutions.
At February 25, 1995, working capital was $75,223,000 an increase of $16,700,000
from the amount at August 27, 1994. The Company's principal sources and uses of
cash during the 26 weeks ended February 25, 1995 are set forth in the unaudited
consolidated condensed statement of cash flows for that period.
Principal expected demands at February 25, 1995 on the Company's liquid assets
for the remainder of fiscal 1995 include approximately $3,000,000 for capital
expenditures consisting primarily of building additions, tooling, equipment
replacement and new equipment. Subsequent to the quarter ended February 25,
1995, Cycle-Sat finalized the purchase of a majority of the assets of the T.F.I.
Division of MPO Videotronics (MPO), a private company headquartered in Newbury
Park, California, on March 31, 1995 for $10,100,000. Cycle-Sat is financing the
acquisition through a term loan with Firstar Bank and terms provided by MPO
which aggregate $8,600,000. The agreement with Firstar is guaranteed by
Winnebago Industries, Inc.
Based upon available cash, marketable securities and financing resources,
described in Note 4 as supplemented by the discussion in the preceding
paragraph, management believes that the Company has adequate sources of funds to
meet its remaining fiscal 1995 cash requirements.
Part II Other Information
Item 1 Legal Proceedings
Subsequent to the quarter ended February 25, 1995, the Company received
a letter from Eileen Harrington, Associate Director for Marketing
Practices of the Federal Trade Commission (FTC), dated March 28, 1995
in which she referenced the FTC's investigation of the Company's
possible violations of Section 5 of the FTC Act in connection with its
marketing and sale of the diesel-powered LeSharo and Phasar motor homes
and Centauri vans and indicated that after further review of the
matter, the FTC had concluded that no further action was warranted by
the Commission at this time and that accordingly the investigation had
been closed. The FTC had issued to the Company on April 23, 1991 Civil
Investigative Demands to produce documents and answers to written
interrogatories in connection with an investigation of whether the
Company engaged in deceptive practices in selling approximately 7,800
of the aforedescribed vehicles which were produced between 1983 and
1986. After narrowing the FTC Civil Investigative Demands through a
Motion to Quash and subsequent stipulated order, the Company produced
responsive documents at its corporate offices in December, 1991 and
January, 1992. The Company then had no further contact with the FTC for
approximately 26 months when the Company's FTC counsel in Washington,
DC received a letter dated March 22, 1994 from the FTC staff in which
it was suggested that the FTC staff had concluded that the Company had
engaged in violations of Section 5 of the FTC Act in connection with
the marketing and sale of the subject vehicles. Such letter also
suggested a willingness to pursue consent negotiations with the Company
or otherwise that the staff would be preparing a recommendation to the
Commission that it issue a complaint against the Company seeking
consumer redress and other equitable relief.
Item 4 Submission of Matters to a Vote of Security Holders
(a) The annual meeting was held December 14, 1994.
(b) The election of nine directors was the only shareholder business
transacted at the annual meeting. The breakdown of the votes was
as follows:
<TABLE>
<CAPTION>
VOTES CAST VOTES CAST VOTES
FOR AGAINST ABSTAINED
<S> <C> <C> <C>
John K. Hanson 22,442,742 18,476 74,720
Gerald E. Boman 22,449,108 12,110 74,720
David G. Croonquist 22,454,839 6,379 74,720
Fred G. Dohrmann 22,448,377 12,841 74,720
Keith D. Elwick 22,456,194 5,024 74,720
Donald W. Olson 22,446,135 15,083 74,720
Joseph M. Shuster 22,459,318 1,900 74,720
Frederick M. Zimmerman 22,460,318 900 74,720
Francis L. Zrostlik 22,456,698 4,520 74,720
</TABLE>
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibit - See Exhibit Index on page 13.
(b) The Company did not file any reports on Form 8-K during the period
covered by this report.
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.
WINNEBAGO INDUSTRIES, INC.
(Registrant)
Date April 7, 1995 /s/ Fred G. Dohrmann
Fred G. Dohrmann
President and Chief Executive Officer
Date April 7, 1995 /s/ Ed F. Barker
Ed F. Barker
Vice President, Controller and Chief
Financial Officer
EXHIBIT INDEX
4.c Amendment to Line of Credit Agreement and Term Loan Agreement among
Winnebago Industries, Inc., Cycle-Sat, and Firstar Bank Cedar Rapids.
27 Financial Data Schedule - Article 5
FIRST AMENDMENT TO
CREDIT AGREEMENT
(REVOLVING LINE OF CREDIT FACILITY)
This First Amendment to Credit Agreement ("First Amendment") is dated
as of January 31, 1995 and is by and between Cycle Sat, Inc., a corporation duly
organized and validly existing under the laws of the State of Iowa, (the
"Borrower") and Firstar Bank Cedar Rapids, N.A. (the "Bank");
WHEREAS, the Borrower and the Bank have previously entered into a
Credit Agreement (the "Agreement") dated as February 24, 1994; and
WHEREAS, the Borrower has requested and the Bank has approved certain
further credit consideration which require amendments to the Agreement;
NOW, THEREFORE, do the parties agree to amend the Agreement as follows:
1. LINE OF CREDIT. Section 1 of the Agreement shall be deleted in its
entirety and replaced with the following:
"The Borrower has requested that the Bank provide the Borrower with a
line of credit in an aggregate principal amount at any time not to
exceed $4,500,000 for working capital purposes including repayment of
intercompany indebtedness. The line of credit is evidenced by a
promissory note (together with any renewals or substitutions the
"Promissory Note")."
2. REVOLVING LINE OF CREDIT BORROWING LIMIT. Section 3 of the Agreement
shall be amended in part to read as follows:
"...provided that the aggregate principal amount advance is limited to
the lesser of $4,500,000 or the sum of the following borrowing base:
80% of "Eligible Accounts Receivable"; and
50% of "Inventory"."
3. AFFIRMATIVE COVENANTS.
1. The first sentence of Section 7.e.(i) shall be deleted in its
entirety and replaced with the following "...The Borrower will maintain as of
fiscal year end 1996 a tangible net worth of not less than $1,500,000 and not
less than $7,500,000 as of fiscal year end 1997. This ratio will not be
applicable during fiscal 1995..."
2. Section 7.e. shall be amended to include the following subsections:
(ii) Current Ratio. The Borrower will maintain at all times a ratio of
current assets to current liabilities of not less than 1.0 to 1.
(iii) Leverage Ratio. The Borrower will maintain at all times a ratio
of total liabilities to Tangible Net Worth of not greater than 8.5 to
1 for fiscal year-end 1996 and 2.5 to 1 for fiscal year-end 1997 and
thereafter. This ratio will not be applicable during fiscal 1995.
(iv) Cash Flow/Debt. The Borrower will maintain at all times a ratio
of Operating Cash Flow to Total Debt Service of not less than 1.05 to
1. "Operating Cash Flow" means the net income of the Borrower plus
income taxes, interest expense, depreciation, non-cash amortization
and other non-cash items, and adjusted to eliminate extraordinary
items and adjusted on a consistent basis to reflect increases or
decreases that result from acquisition, sales or exchanges of
property. "Total Debt Service" means all principal and interest due
and payable during any period of computation arising from all of the
Borrower's indebtedness."
3. The following shall be added as Section 7.e. (v):
"(v) In the event that the Borrower realizes a leverage ratio of 3.0
to 1 and maintains a collateral coverage equal to or in excess of
total outstanding obligation to the Bank,, then the guarantee of
Winnebago Industries, Inc. will be returned to the Guarantor, with the
specific understanding that if these levels are not maintained a new
guaranty will be immediately executed. Collateral coverage shall be
computed as 80% of accounts receivabe, 50% of inventory and 50% of net
book value of equipment."
4. TERM LOAN AND PAYMENT PROVISIONS. The following section shall be
added as Section 8 and all subsequent sections shall be renumbered.
"8. TERM LOAN AND PAYMENT PROVISIONS.
a. Term Loan Definitions.
(i) "Term Loan" shall have the meaning ascribed hereto in the
following subsections 8.a. through 8.f.
(ii) "Term Loan Interest Rate" means the rate of interest to be
charged by the Bank to the Borrower hereunder, which is the 90
day LIBOR rate, plus 2.5 percent, as adjusted in accordance with
the Term Loan Promissory Note.
(iii) "Term Loan Promissory Note" means the promissory note and
all of its terms and provisions, in substantially the form of
Exhibit A attached hereto, to be delivered by the Borrower to the
Bank pursuant hereto.
(iv) "Term Loan Termination Date" means September 28, 1999, or
earlier upon the occuraence of an Event of Default or otherwise
as provided herein.
b. Borrowing. Subject to the terms and conditions of the Agreement,
the Bank shall lend to the Borrower the principal sum of
$4,400,000.
c. Term Loan Promissory Note. The Borrower shall execute and deliver
to the Bank the Term Loan Promissory Note with this Amendment.
The Term Loan Promissory Note, together with this Amendment and
the other documents referred to herein, shall evidence the
Borrower's indebtedness to the Bank under the Term Loan.
d. Interest. In accordance with the Term Loan Promissory Note, the
Borrower shall pay interest to the Bank upon the outstanding
daily principal balance of the Term Loan, which interest shall be
computed at the close of each day, at the Term Loan Interest Rate
(on the basis of actual days elapsed in the yea of 360 days).
Until the Term Loan Termination Date, such interest shall be paid
monthly in arrears, commencing on the first day of the next
succeeding month following the month in which this Amendment is
executed, and continuing on the first day of each successive
month thereafter. At the Term Loan Termination Date, all sums due
hereunder shall be due and payable. All payments shall be made to
the Bank on or before the required due dates in immediately
available funds.
e. Repayment. The Borrower shall pay principal, interest and charges
that are "directly attributable" to the Term Loan in accordance
with the provisions of the Term Loan Promissory Note.
f. Determination of Balances. The records of the Bank shall be prima
facia evidence as to the amount of advances, outstanding
principal balance, and accrued interest and charges.
6. SAVINGS. All terms and conditions of the Agreement not specifically
modified herein shall remain in full force and effect.
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEEMENT.
Cycle-Sat, Inc.
By: /s/ Loren A. Swenson
Loren A. Swenson, CEO/President
By: /s/ William B. Grandy
William B. Grandy, CFO/Vice Pres.
Firststar Bank Cedar Rapids, N.A.
By: /s/ Dirk A Thierer
Dirk A Thierer, Vice President
Guarantor
Winnebago Industries,
By: /s/ Fred G. Dohrmann
VARIABLE BALANCE PROMISSORY NOTE Br 2030
(Not a Consumer Credit Transaction)
DAT
INCR.$1,500,000.00
Maker Cycle-Sat, Inc. _ _ Note No. 1247441--9001
Note Date JANUARY 31 , 1995 Maturity Date FEBRUARY 1, 1996
MAXIMUM CREDIT AMOUNT: FOUR MILLION FIVE THOUSAND AND NO/100
(S 4,500,000.00)
Purpose Working capital
FOR VALUE RECEIVED, the undersigned, jointly and severally,
as principals, promise to pay to the order of FIRSTAR BANK CEDAR RAPIDS, NA,
Cedar Rapids, Iowa, (hereinafter refered to as "Bank") its successors and
assigns; the Maximum Credit Amount; or so much of the Maximum Credit Amount as
may be advanced under this Note by any holder of this Note.
with interest thereon to be adjusted daily beginning 01/31/95 to be
equal to 1.500 percentage points above the 90 day LIBOR to adjust every
90 days, as the same may be on the dates of adjustment;
per annum; said principal and interest to be paid as follows:
Interest sha1l be due month1y beginning 03/01/95, and thereafter on the
lST of each month with the principal ba1ance and any remaining interest
due at maturity.
Each such payment shall be applied first in payment of interest due on
the unpaid balance and the remainder in reduction of the principal. All interest
shall be computed for the actual number of days elapsed upon the actual
principal balance from time to time outstanding on the basis of a year of 360
days.
The Maximum Credit Amount set forth above represents the total amount
which Bank has agreed to advance from time to time to the undersigned. Except as
otherwise provided below, the undersigned may, up to the Maximum Credit Amount,
at any time, and from time to time prior to the Maturity Date of this note,
borrow, repay, and reborrow from Bank and the liability of the undersigned
hereunder shall be the principal amount from time to time outstanding pursuant
to this note plus interest as provided above.
Bank's determination as to the outstanding balance owed by the
undersigned hereunder shall be conclusive and Bank's documentation to support
said outstanding balance will be sufficient to establish and sustain the
undersigneds' obligation hereunder. Advances may be made by credit by Bank to
the undersigneds' depository account. Requests for advances may be made to Bank
at the request of any one of the undersigned and such requests may be in
writing, orally, or by telephone. The undersigned agree to assume full
responsibility for preserving evidence of payments until this note has been
presented to the undersigned, marked paid.
Bank may require any and all documentation and additional confirmation
as to authorization for any requested advance. Upon the failure of the
undersigned to provide said data in a form satisfactory to Bank, or upon the
occurrence of an Event of Default (has hereinafter defined), or upon the
occurrence of any event which would constitute an Event of Default but for the
requirement that notice be given or time elapse or both, Bank may, at its
option, refuse to honor any request for an advance of funds.
If referred to or used herein, the term "Prime Rate" (or any similar
reference) shall mean that rate of interest described as the "Prime Rate" of
Bank announced from time to time by Bank and determined at the sole discretion
of Bank management as part of its internal procedures. No representation is made
by Bank to the undersigned that the "Prime Rate" is the lowest, the best, or a
favored rate.
This note is secured by all existing and future liens and security
interests created by security agreements, mortgages, or any other collateral
documents now or hereafter between Bank and the undersigned or now or hereafter
between Bank and any endorsers, sureties, or guarantors of this note and payment
may be accelerated according to any of said agreements and documents. The
undersigned and all endorsers, sureties, and guarantors of this note are
hereinafter collectively referred to as the "Obligors." In addition to Bank's
common law rights of set off, the undersigned hereby grant to Bank a security
interest and lien in any credit balance or other money now or hereafter owed
them by Bank, and, in addition, the undersigned agree that Bank may, without
notice or demand, set off against any such credit balance or other asset(s) any
amount unpaid under this note, whether due or not.
The undersigned represent and warrant that the extension of credit
evidenced by this note is for business, commercial, or agricultural purposes, or
is to an organization.
OTHER PROVlSlONS:Continuation of obligation represented by Note # 9001
dated 02/24/94.
The security document(s) by which is note is secured include, but not
limited to:
Security Agreement dated 2-24-94;
Credit Agreement dated 2-24-94 as amended.
THE ADDITIONAL TERMS AND CONDITIONS SET FORTH ON PAGE TWO OF THIS NOTE ARE A
PART OF THIS NOTE. THE UNDERSIGNED HEREBY ACKNOWLEDGE THE RECEIPT OF A COPY OF
THIS NOTE
119 John K. Hanson Drive
Forest City, IA 50436
Cycle - Sat, Inc .
By:
Loren A. Swenson, CE0/President
By:
William B. Grandy, CFO/Vicc Pres.
S.S. or Fed l D. 42-1246889
ORIGINAL Page 1 of 2
ADDITIONAL TERMS AND CONDITIONS
1. The Obligors, jointly and severally: (i) waive presentment, demand,
notice of demand, protest, notice of protest, notice of nonpayment, and any
other notice required to be given under the law to any of the Obligors in
connection with the delivery, acceptance, performance, default, or enforcement
of this note, of any endorsement, surety agreement or guaranty of this note, or
of any document or instrument evidencing any security for payment of this note;
(ii) consent to any and all acceptances of partial payments, delays, extensions,
renewals, or other modifications of this note or waivers of any term hereof, any
release or discharge by Bank of any of the Obligors, any agreement by Bank not
to sue any Obligor, the release, substitution, or exchange of any security for
the payrnent hereof, the failure to act on the part of Bank and any indulgence
shown by Bank from time to time and in one or more instances (without notice to
or consent of any of the Obligors), and agree that no such act, failure to act,
or failure to exercise any right or remedy on the pan of the Bank shall in any
way affect or impair the obligations of any of the Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this note,
under any endorsement, surety agreement or guaranty of this note, or under any
document or instrument evidencing any security for payment of this note; (iii)
agree that Bank is not required to first resort to any collateral for payment
before bringing an action hereon (or on any endorsement, surety agreement or
guaranty of this note) against the Obligors or any one or more of them; and (iv)
agree to pay, on demand, all costs and expenses of collection of this note or of
any endorsement or any guaranty hereof and/or the enforcement of Bank's rights
with respect to, or the administration, supervision, preservation, protection
of, or realization upon, any property securing payment hereof, including, but
not limited to, attorneys' fees and court costs, wrth such fees and expenses
being advances hereunder.
2. The occurrence of any one or more of the following shall constitute
an event of default under this note ("Event of Default"): (i) the failure of the
Obligors to timely pay and discharge any obligations, liabilities, or
indebtedness of any of the Obligors to Bank, whether under this note or any
other agreement, note or instrument now or hereafter existing, as and when due
(whether at maturity or by acceleration and no prior demand therefor by Bank
being necessary); (ii) death of any of the Obligors (if an individual), or a
proceeding being filed or commenced (voluntarily or involuntarily) for the
dissolution or liquidation of any of the Obligors; (iii) the failure by the
Obligors to timely pay any installment of principal or interest or the failure
to perform any of the convenants, agreements or conditions of any other note,
the collateral for which is also collateral for this note; (iv) the insolvency
or business failure of any of the Obligors, or the appointment of a custodian,
trustee, liquidator or receiver for any of the Obligors or for any of the
property of the Obligors; (v) any assignment for the benefit of creditors by or
against any of the Obligors, or the filing of a petition (whether voluntarily or
involuntarily) by or against the Obligors under any bankruptcy, insolvency, or
debtor's relief law; (vi) the occurrence of any readjustment of indebtedness,
composition or extension of any indebtedness of any of the Obligors; (vii) any
attachments, liens or additional security interest being placed upon any of the
collateral for this note; (viii) acquisition at any time or from time totime of
title to the whole of or any part of the collateral for this note by any person
or entity other than any of the Obligors; (ix) Bank determining that any
representation or warranty made by any of the Obligors to Bank is, or was when
made, untrue ro materially misleading; (x) the occurrence of any default as
defined in any security document which secures this note; (xi) Bank deeming
itself insecure; or (xii) the occurrence of a default in the due observance or
performance of or breach of any agreement of this note regarding these
obligations between the Obligors and Bank. (xiii) any change in the stock
ownership of Obligor.
3. Upon the occurrence of an Event of Default, the entire principal
balance plus accrued interest outstanding hereunder and any or all other
liabilities, indebtedness and obligations of the Obligors to Bank (however
acquired or evidenced) shall, at the option of Bank, become irnmediately due and
payable, without presentment, notice, protest or demand of any kind (all of
which are expressly waived by the Obligors), and to the extent permitted by law,
the rate of interest on the unpaid principal and accrued interest shall, at the
option of Bank, be increased to four percent (4%) over the interest rate (as
shown on the face of this note), compounded monthly, or four percent (4%) over
the Prime Rate of Bank ("Bank Default Rate"). The Bank Default Rate will change
each time and as of the date that the Prime Rate of Bank changes. Failure at any
time to exercise any of the aforesaid options or any other rights of Bank
hereunder shall not constitute a waiver by Bank thereof, nor shall it prevent
Bank from exercising any of the aforesaid options or rights at a later date. If
this note is payable on demand, the acceptance by Bank of any partial payment
hereof, from any of the Obligors, shall not affect the demand tenor of this
note.
4. This note is delivered in and shall be construed in accordance with
the laws of the State of Iowa, and all litigation arising out of this note or of
any endorsement or guaranty of this note or any security given for payment
hereof shall be brought only in the courts of the State of Iowa or the courts of
the United States which are situated in the State of Iowa and the Obligors,
jointly and severally, consent to and confer personal jurisidiction upon the
courts of the State of Iowa or the courts of the United States which are
situated in the State of Iowa, and expressly waive any objections as to venue in
any of such courts, and agree that service of process may be made on the
Obligors by mailing a copy of the summons to their respective addresses.
5. In the event any one or more of the provisions of this note shall
for any reason be held to be invalid, illegal, or unenforceable, in whole or in
part or in any respect, or in the event that any one or more of the provisions
of this note operate or would prospectively operate to invalidate this note,
then and in either of those events, such provision or provisions only shall be
deemed null and void and shall not affect any other provision of this note and
the remaining provisions of this note shall remain operative and in full force
and effect and shall in no way be affected, prejudiced, or disturbed thereby.
6. The Obligors shall from time to time, upon request by Bank, permit a
representative of Bank to inspect and make copies of the Obligors' books and
records at all reasonable times. The Obligors shall furnish Bank such financial
information in a form acceptable to Bank as Bank may from time to time request.
7. Bank may, at its option, sell participations in or assign all or
part of this note to another bank or entity. Bank may furnish any information
concerning Borrower in the possession of Bank from time to time to such assignee
or participant.
8. IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD
BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER
TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY
ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN
AGREEMENT.
ORIGINAL Obligor Page 2 of 2
JANUARY 3l, l995
FIRSTAR BANK CEDAR RAPIDS, N.A.
Firstar Bank Cedar Rapids, N.A.
222 Second Avenue SE
Cedar Rapids. IA 52401
RE: Account Name: Cycle-Sat, Inc.
Loan Dated: JANUARY 31, 1995
Loan Number: 1247441--9001
Principal Amount: $4,500,000.00
ID #42-1246889
To Whom It May Concern:
The following named individuals are authorized to make oral or written
requests for advances under the above-referenced note, and all future renewals:
Name Title
Loren A. Swenson CEO/President
William B. Grandy CFO/Vice President
Firstar Bank Cedar Rapids, N.A. is entitled to rely upon the oral or
written requests for advances of any one of the named individuals until the
authority granted herein is revoked in writing.
Each of the undersigned acknowledges that a request made by any one of
the above-named individuals shall be binding upon and consented to by remaining
signators.
Each of the undersigned acknowledge receipt of a copy of this document.
JANUARY 31, 1995
Date
Cycle-Sat, Inc.
BY:
Loren A. Swenson, CEO/President
BY:
William B. Grandy, CFO/Vice Pres.
ADDITIONAL TERMS AND CONDITIONS
1. The Obligors, jointly and severally: (i) waive presentment, demand,
notice of demand, protest, notice of protest, notice of nonpayment, and any
other notice required to be given under the law to any of the Obligors in
connection with the delivery, acceptance, performance, default, or enforcement
of this note, of any endorsement, surety agreement or guaranty of this note, or
of any document or instrument evidencing any security for payment of this note;
(ii) consent to any and all acceptances of partial payments, delays, extensions,
renewals, or other modifications of this note or waivers of any term hereof, any
release or discharge by Bank of any of the Obligors, any agreement by Bank not
to sue any Obligor, the release, substitution, or exchange of any security for
the payrnent hereof, the failure to act on the part of Bank and any indulgence
shown by Bank from time to time and in one or more instances (without notice to
or consent of any of the Obligors), and agree that no such act, failure to act,
or failure to exercise any right or remedy on the pan of the Bank shall in any
way affect or impair the obligations of any of the Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this note,
under any endorsement, surety agreement or guaranty of this note, or under any
document or instrument evidencing any security for payment of this note; (iii)
agree that Bank is not required to first resort to any collateral for payment
before bringing an action hereon (or on any endorsement, surety agreement or
guaranty of this note) against the Obligors or any one or more of them; and (iv)
agree to pay, on demand, all costs and expenses of collection of this note or of
any endorsement or any guaranty hereof and/or the enforcement of Bank's rights
with respect to, or the administration, supervision, preservation, protection
of, or realization upon, any property securing payment hereof, including, but
not limited to, attorneys' fees and court costs, wrth such fees and expenses
being advances hereunder.
2. The occurrence of any one or more of the following shall constitute
an event of default under this note ("Event of Default"): (i) the failure of the
Obligors to timely pay and discharge any obligations, liabilities, or
indebtedness of any of the Obligors to Bank, whether under this note or any
other agreement, note or instrument now or hereafter existing, as and when due
(whether at maturity or by acceleration and no prior demand therefor by Bank
being necessary); (ii) death of any of the Obligors (if an individual), or a
proceeding being filed or commenced (voluntarily or involuntarily) for the
dissolution or liquidation of any of the Obligors; (iii) the failure by the
Obligors to timely pay any installment of principal or interest or the failure
to perform any of the convenants, agreements or conditions of any other note,
the collateral for which is also collateral for this note; (iv) the insolvency
or business failure of any of the Obligors, or the appointment of a custodian,
trustee, liquidator or receiver for any of the Obligors or for any of the
property of the Obligors; (v) any assignment for the benefit of creditors by or
against any of the Obligors, or the filing of a petition (whether voluntarily or
involuntarily) by or against the Obligors under any bankruptcy, insolvency, or
debtor's relief law; (vi) the occurrence of any readjustment of indebtedness,
composition or extension of any indebtedness of any of the Obligors; (vii) any
attachments, liens or additional security interest being placed upon any of the
collateral for this note; (viii) acquisition at any time or from time totime of
title to the whole of or any part of the collateral for this note by any person
or entity other than any of the Obligors; (ix) Bank determining that any
representation or warranty made by any of the Obligors to Bank is, or was when
made, untrue ro materially misleading; (x) the occurrence of any default as
defined in any security document which secures this note; (xi) Bank deeming
itself insecure; or (xii) the occurrence of a default in the due observance or
performance of or breach of any agreement of this note regarding these
obligations between the Obligors and Bank. (xiii) any change in the stock
ownership of Obligor.
3. Upon the occurrence of an Event of Default, the entire principal
balance plus accrued interest outstanding hereunder and any or all other
liabilities, indebtedness and obligations of the Obligors to Bank (however
acquired or evidenced) shall, at the option of Bank, become irnmediately due and
payable, without presentment, notice, protest or demand of any kind (all of
which are expressly waived by the Obligors), and to the extent permitted by law,
the rate of interest on the unpaid principal and accrued interest shall, at the
option of Bank, be increased to four percent (4%) over the interest rate (as
shown on the face of this note), compounded monthly, or four percent (4%) over
the Prime Rate of Bank ("Bank Default Rate"). The Bank Default Rate will change
each time and as of the date that the Prime Rate of Bank changes. Failure at any
time to exercise any of the aforesaid options or any other rights of Bank
hereunder shall not constitute a waiver by Bank thereof, nor shall it prevent
Bank from exercising any of the aforesaid options or rights at a later date. If
this note is payable on demand, the acceptance by Bank of any partial payment
hereof, from any of the Obligors, shall not affect the demand tenor of this
note.
4. This note is delivered in and shall be construed in accordance with
the laws of the State of Iowa, and all litigation arising out of this note or of
any endorsement or guaranty of this note or any security given for payment
hereof shall be brought only in the courts of the State of Iowa or the courts of
the United States which are situated in the State of Iowa and the Obligors,
jointly and severally, consent to and confer personal jurisidiction upon the
courts of the State of Iowa or the courts of the United States which are
situated in the State of Iowa, and expressly waive any objections as to venue in
any of such courts, and agree that service of process may be made on the
Obligors by mailing a copy of the summons to their respective addresses.
5. In the event any one or more of the provisions of this note shall
for any reason be held to be invalid, illegal, or unenforceable, in whole or in
part or in any respect, or in the event that any one or more of the provisions
of this note operate or would prospectively operate to invalidate this note,
then and in either of those events, such provision or provisions only shall be
deemed null and void and shall not affect any other provision of this note and
the remaining provisions of this note shall remain operative and in full force
and effect and shall in no way be affected, prejudiced, or disturbed thereby.
6. The Obligors shall from time to time, upon request by Bank, permit a
representative of Bank to inspect and make copies of the Obligors' books and
records at all reasonable times. The Obligors shall furnish Bank such financial
information in a form acceptable to Bank as Bank may from time to time request.
7. Bank may, at its option, sell participations in or assign all or
part of this note to another bank or entity. Bank may furnish any information
concerning Borrower in the possession of Bank from time to time to such assignee
or participant.
8. IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD
BE READ CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER
TERMS OR ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY
ENFORCED. YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN
AGREEMENT.
ORIGINAL Obligor Page 2 of 2
G U A R A N T Y ID #42-1246889
UNLIMITED AND CONTINUING
THIS GUARANTY is given by the undersigned (hereinafter referred to as
the "Guarantors") to induce Firstar Bank Cedar Rapids. N.A., (hereinafter
referred to as "Lender") to extend credit to, or otherwise become the creditor
of Cvcle-Sat, Inc. (hereinafter referred to as "Borrower"). Guarantors
understand that the Lender is willing to become the creditor of Borrower only if
Guarantors guaranty the faithful performance of all the terms and conditions
upon which such credit is extended to borrower, and Guarantors are desirous of
having Lender extend such credit to Borrower upon such terms and conditions as
are agreed upon by Lender and Borrower.
In consideration of the foregoing, it is agreed:
1. Guarantors, jointly and severally, absolutely and unconditionally,
guaranty to Lender, its successors and assigns, the prompt payment to Lender,
its successors and assigns, of all loans, drafts. overdrafts, checks, notes and
any and all other debts, obligations and liabilities of every kind of Borrower
to Lender, including extensions, renewals or refundings thereof (including
extensions, renewals or refundings made after receipt by Lender of written
notice of termination or revocation hereof), whether as maker, co-maker, drawer,
guarantor, indorser, or otherwise, whether direct or indirect, liquidated or
unliquidated, absolute or contingent, joint or several, now existing or
hereafter arising, due or to become due, whether originally contracted with
Lender, and whether such indebtedness is from time to time reduced and
thereafter increased or entirely extinguished and thereafter reincurred,
including interest and charges and to the extend not prohibited by law, all
costs, expenses, fees and attorneys' fees at any time paid or incurred by
Lender, or its successors or assigns, in efforts to collect all or part of the
foregoing liabilities and obligations or to realize upon any collateral securing
the foregoing liabilities and obligations (the foregoing are hereinafter
collectively referred to as the "Liabilities"). All of the Liabilities shall
conclusively be presumed to have been created or accepted by Lender in reliance
on this Guaranty.
In addition to the foregoing obligations of Guarantors, to the extent
not prohibited by law, Guarantors shall be obligated to Lender for any and all
costs and expenses incurred by Lender to realize upon this Guaranty, including,
but not limited to, reasonable attorneys' fees, legal expenses and court costs.
2. This Guaranty is a continuing guaranty and shall remain in effect
until notice of termination in writing is given to Lender. Termination shall be
effective only upon receipt of such notice by Lender. Such termination will be
effective only with respect to those Liabilities incurred or contracted by
Borrower or acquired by Lender after the date on which such written notice is
received by Lender. Notwithstanding the giving of such termination notice and
notwithstanding any other provision contained in this Guaranty, this Guaranty
shall remain in full force and effect as to all of the following: (i) all of
those Liabilities existing on the date of receipt by Lender of the notice of
termination, (ii) all renewals and extensions thereof, (iii) all Liabilities
arising out of any loan commitments existing prior to the receipt by Lender of
the notice of termination, and (iv) all costs, expenses, fees and attorneys'
fees at any time paid or incurred by Lender, or its succsssors or assigns, in
efforts to collect the Liabilities, or to realize upon this Guaranty or any
collateral securing the Liabilities whether or not such costs, expenses or fees
are incurred by Lender before or after the delivery of the notice of termination
until full payment of the Liabilities and other obligations to Lender.
Termination of this Guaranty by notice or by operation of law shall affect the
Liabilities in such order as Lender may elect and without any obligation to
account to any of the Guarantors for the manner or order of application. Any
termination of this Guaranty by a Guarantor shall only be effective as to the
Guarantor who has given written notice and shall not be effective as to any of
the other Guarantors.
3. This Guaranty shall be construed as an absolute, continuing and
unlimited guaranty of payment and to the extent permitted by law shall be valid
and enforceable against Guarantors without regard to the regularity, validity or
enforceability of any of the Liabilities. This Guaranty shall be both in
supplement of and in addition to any other guaranty or guaranties, indemnity or
indemnities which shall be furnished to Lender by Guarantors or by any other
person or persons to secure the Liabilities The failure of any person or entity
to sign this Guaranty shall not release or affect the liability of any signator
hereto.
4. Guarantors, jointly and severally, agree, without affecting
Guarantors' liability to Lender hereunder, that Lender may, without notice to or
consent of Guarantors, upon such terms as Lender may deem advisable: (a) from
time to time, extend credit to or otherwise become the creditor of Borrower, (b)
renew, extend, modify, or amend the terms of any of the Liabilities or any
agreement pursuant to which any of the Liabilities were created or security
therefor is held, including, but not limited to, extending the time of payment
of any of the Liabilities, (c) release, surrender, exchange, modify, substitute,
impair, realize upon or deal with any collateral securing any of the
Liabilities, (d) settle or compromise any claim of Lender against Borrower, or
against any other person, firm, or corporation, whose obligation is held by
Lender as collateral security for any of the Liabilities, (e) exercise or
refrain from exercising any rights against Borrower, Guarantors. other
guarantors, or any collateral securing the Liabilities, (f) settle, release or
otherwise enter into agreements regarding the Liabilities with any party
primarily or secondarily liable on the Liabilities, and (g) apply any collateral
for the Liabilities in such order as it may elect and without any ob1igation to
account to Guarantors for the manner or order of application Guarantors hereby
waive all defenses, counterclaims, and offsets which Guarantors, jointly and
severally, might have by reason of Lender taking any of the foregoing actions
and all such actions shall be binding upon Guarantors, jointly and severally.
5. Guarantors, jointly and severally, waive: (a) notice of Borrowers
incurring any of the Liabilities, (b) notice of acceptance of this Guaranty by
Lender, (c) notice of presentment, demand for payment, protest or dishonor of
any of the Liabilities, or the obligation of any person, firm, or corporation,
held by Lender as collateral security for the Borrower's obligation, (d) notice
of the failure of any person, firm, or corporation to pay to Lender any
indebtedness held by Lender as collateral security for any of the Liabilities,
(e) all defenses, offsets and counterclaims which Guarantors may at any time
have to any claim of Lender against Borrower, and (f) notice of any default on
the part of Borrower and any demand for the payment of the Liabilities; provided
however, if this Guaranty is for a "Consumer Credit Transaction", as defined in
the Iowa Consumer Credit Code, Lender shall give such notices, if any as may be
required by law.
6. Guarantors, jointly and severally, represent and warrant that, at
the time of the execution and delivery of this Guaranty, there are no conditions
to the effectiveness of this Guaranty and nothing exists to impair the
effectiveness of the liability of Guarantors to Lender hereunder, or to prevent
this Guaranty from taking immediate effect with respect to the guaranty by
Guarantors of the Borrower's obligations to Lender under the Liabilities.
7. Actions to enforce this Guaranty may be brought successively against
one or more of Guarantors, jointly or severally, and against less than all of
Guarantors without impairing or affecting the rights of Lender against the
others. Guarantors may, however, agree among themselves that no release or
settlement shall impair their rights as among themselves. Any claim, including a
claim for contribution, which any of the Guarantors may have against a
co-guarantor indebted or under liability to Lender, either direct or indirect,
or against Borrower, shall not be enforced or payment made until the
indebtedness or liability of the co-guarantor or Borrower to Lender is paid in
full. The collateral given to secure this Guaranty by a co-guarantor indebted or
under liability to Lender shall be applied in payment of the indebtedness or
liability of the co-guarantor to Lender before any part is applied on a claim of
Borrower or a co-guarantor, including, but not limited to, a claim for
contribution of one or more of the Guarantors against a co-guarantor. Lender
may, at its option, proceed in the first instance against Guarantors, jointly
and severally, to collect any obligation covered by this Guaranty, without first
proceeding against Borrower, or any other person, firm, or corporation, and
without first resorting to any property at any time held by Lender as collateral
or security for the payment of the Liabilities or for the performance of
Guarantors' obligations under this Guaranty.
THIS GUARANTY SPECIFICALLY INCLUDES ALL THE ADDITIONAL PROVISIONS SET FORTH ON
PAGE 2 HEREOF, THE SAME BEING INCORPORATED BY REFERENCE
CUSTOMER COPY Page 1 of 2
8. The obligations of Guarantors hereunder shall not in any manner
be affected by any of the following: (i) the failure on the part of the Lender
to realize upon, perfect any interest in, or protect any of the Liabilities or
security therefore or take any action with respect thereto, (ii) any impairment,
modification, change, release or limitation of any of the Liabilities resulting
from the operation of any present or future provision of the Bankruptcy Code or
similar statute, or from the decision of any court, (iii) any act or omission by
Lender arising out of Lender's administration of the Liabilities or which in any
way alters the scope of the Guarantors' risk, or (iv) any change, exchange or
alteration of any collateral or other security held by Lender for payment of the
Liabilities or the surrender or release of any such collateral or security.
9. This Guaranty shall not be discharged or in any way affected by the
death of Guarantors.
10. This Guaranty is secured by all of the following: (a) all
collateral previously, now or hereafter pledged to Lender by any of the
Guarantors, (b) all security interests previously, now or hereafter granted to
Lender by any of the Guarantors and (c) all real estate mortgages previously,
now or hereafter granted to Lender by any of Guarantors (whether such pledge,
security interest or real estate mortgage specifically relates to the
Liabilities or not); provided, however, this Guaranty shall not be secured by
any such pledge, security interest or real estate mortgage given in a "Consumer
Credit Transaction", as defined in the lowa Consumer Credit Code, unless
specifically provided for therein. Guarantors hereby grant to Lender a security
interest in all accounts, deposits and property of Guarantors in the possession
of Lender, and Lender shall have the right to set off, at any time without
notice to Guarantors, any and all deposits and other sums due from Lender to
Guarantor(s).
11. Guarantors, jointly and severally, agree that in the event any
payment made by or on behalf of Borrower respecting any of the Liabilities, or
any portion of any such payment, shall at any time be repaid by the recipient in
compliance with an order (whether or not final) by a court of competent
jurisdiction pursuant to any provision of the Bankruptcy Code, as now existing
or hereafter amended, or any provision of applicable state law, the Liabilities
shall not be deemed to have been paid to the extent of the repayment so made and
the obligations of each Guarantor shall continue in full force and effect, and
Lender and Lender's successors and assigns will continue to be entitled to the
full benefits of this Guaranty.
12. All payments received by Lender from Guarantors shall be deemed to
have been made by all Guarantors together with any other guarantors who may be
obligated to Lender on account of the Liabilities, unless Lender is otherwise
advised in writing by all Guarantors and all such other parties. Upon payment,
in full, by Guarantors of the Liabilities, Lender will assign and transfer all
of Lender's rights, if any, in and to the Liabilities (without recourse or any
express or implied warranties) to Guarantors and any other guarantors who may be
obligated to Lender on account of the Liabilities, any such transfer to be in
common (regardless of the source or sources of payment of the Liabilities)
unless Lender is otherwise instructed in writing by all of Guarantors and all
such other parties. Guarantors waive all rights of subrogation to any collateral
and remedies of Lender against Borrower, and other persons or entities, until
all of the Liabilities have been paid in full and discharged.
13. Guarantors hereby release Lender from any duty it may have to
disclose to Guarantors, or any one of them, facts which Lender might now have or
in the future have concerning the financial condition of Borrower, even though
such facts might materially increase the risk of Guarantors.
14. In the event any portion of this Guaranty shall, for any reason, be
held to be invalid, illegal or unenforceable in whole or in part, the remaining
provisions shall not be affected thereby and shall continue to be valid and
enforceable and if, for any reason, a court finds that any provision of this
Guaranty is invalid, illegal or unenforceable as written, but that by limiting
such provision it would become valid, legal and enforceable then such provision
shall be deemed to be written, construed and enforced as so limited.
15. This Guaranty constitutes the entire agreement of Guarantors with
respect to the subject matter of this Guaranty, and supersedes all negotiations,
preliminary agreements and all prior and contemporaneous discussions between
Guarantors and Lender in connection with the subject matter of this Guaranty. No
course of dealing, course of performance or trade useage, and no parol evidence
of any nature shall be used to supplement or modify any terms of this Guaranty.
16. This Guaranty is delivered and made in, and shall be construed
pursuant to the laws of, the State of Iowa, and is binding, jointly and
severally, upon Guarantors and their heirs, legal representatives, sucesssors
and assigns, and shall inure to the benefit of Lender, its successors and
assigns. This Guaranty may be enforced by any party to whom all or any part of
the Liabilities may be sold, transferred or assigned. If less than all of the
Liabilities are sold, transferrsd or assigned, Lender shall have the right to
enforce this Guaranty as to the remainder of the Liabilities. Words and phrases
herein shall be construed as in the singular or plural number, and as masculine,
feminine or neuter gender according to the context.
17. Guarantors hereby acknowledge that they have (i) each received a
copy of this Guaranty, (ii) read and understand this Guaranty, and (iii) been
advised by Lender to consult with legal counsel before signing this Guaranty.
In Witness Whereof Guarantors have signed this Guaranty on this 31ST day of
JANUARY, 1995
IMPORTANT: READ BEFORE SIGNING. THE TERMS OF THIS AGREEMENT SHOULD BE READ
CAREFULLY BECAUSE ONLY THOSE TERMS IN WRITING ARE ENFORCEABLE. NO OTHER TERMS OR
ORAL PROMISES NOT CONTAINED IN THIS WRITTEN CONTRACT MAY BE LEGALLY ENFORCED.
YOU MAY CHANGE THE TERMS OF THIS AGREEMENT ONLY BY ANOTHER WRITTEN AGREEMENT.
Winnebago Industries, Inc., Guarantor
BY /s/ Fred G. Dohrmann
Fred G. Dohrmann, President & CEO
BY /s/ Raymond M. Beebe
Raymond M. Beebe, V.P., Sec., & General Counsel
STATE OF IOWA, County of HANCOCK, ss.
On this 31ST day of JANUARY A.D., 1995, before me, a Notary Public in and for
said County State of Iowa, personally appeared: Fred G. Dohrmann and Raymond M.
Beebe to me personally known, who being by me duly sworn did say respectively,
that they are President and Vice President, General Counsel and Secretary of
said corporation executing the within and foregoing instrument to which this is
attached, that (the seal affixed thereto is the seal of said) corporation, that
said instrument was signed (and sealed) on behalf of said corporation by
authority of its Board of Directors; and that each of them as such officers
acknowledged the execution of said instrument to be the voluntary act and deed
of said corporation, by it and by them voluntarily executed.
Notary Public in and for the State of Iowa
CUSTOMER COPY Page 2 of 2
Has the subject property or adjoining properties ever been used for:
Industrial purposes YES / NO
wastetreament/storage/Disposal/Recycling YES / NO
Incineration YES / NO
Gasoline/Service Stations YES / NO
Printing Facility YES / NO
Dry Cleaners YES / NO
Analytical/Photo development laboratory YES / NO
Junkyard/Auto Salvage Yard YES / NO
Please provide a detailed explanation for any "YES" answer given above on
attached sheet
Please provide and attach a detailed listing of any wastewater discharges (other
than sanitary and stormwater to sewers).
The foregoing questionnaire consisting of sections 1, 2, 3, 4, 5, 6, 7, 8, 9,
10, 11, 12, 13 and 14 was completed by_______________________________________
(Print)
(include name and title) who by the signature below evidences the authority to
answer this questionnaire on behalf of ________________________________________
(Print )(Borrower)
By executing this questionnaire, Borrower acknowledges that the response given
in this questionnaire are material to the loans already made or to be made in
the future Borrower is under a continuing obligation to correct and update
responses given in this guestionnaire. A11 representations and responses given
here in survive any closing and Firstar Bank may continue to rely on the
responses as accurate and current until otherwise advised by the Borrower.
Cycle-Sat, Inc.
(Borrower)
By: /s/ William B. Grandy
Title: CFO
Date: 3-6-95
Firstar Bank Cedar Rapids, N.A.
February 3, 1995
William B. Grandy, CFO
Cycle Sat, Inc.
119 John K. Hanson Dr.
Forest City, IA 50436
Dear William B. Grandy:
The Commercial Division of Firstar Bank Cedar Rapids, N.A., is pleased to be
working with you in the financial planning for your business.
As a part of our commercial lending process, we are sending you the enclosed
term sheet. We make this proposal available to you to initiate discussion on
lending terms prior to loan negotiations and any final loan agreement and
documentation.
We value our commercial lending customers and look forward to discussing your
lending needs further. If you have any questions regarding the sheet, please
contact me. We appreciate your interest in banking Firststar Bank Cedar Rapids,
N.A.,.and look forward to working with you on your business lending needs.
Sincerely,
/s/ Dirk A. Thierer
Dirk A. Thierer
Commercial Lending Department
jms
Enclosure
TERM SHEET
Firstar Bank Cedar Rapids, N.A., (the "Bank") is pleased to present the
following proposal for your consideration:
Borrower: Cycle Sat, Inc.
Unlimited Guarantors: Winnebago Industries, Inc.
Working Capital Facility
A. Aggregate Amount and Purpose: The Working Capital facility shall
be on a revolving basis in amount up to $4,500,000 for general
working capital purposes.
B. Interest: The Working Capital Facility will be evidenced by a
promissory note which will bear interest at 90-day Libor Rate,
plus 150 basis points, rate to change every 90 days.
C. Borrowing Ability: Borrowings under the working Capital Facility
will be limited to the lessor of $4,500,000 or an amount equal to
the sum of the following Borrowing Base:
80% of (Eligible Accounts Receivable); and
50% of Inventory
"Eligible Accounts Receivable" means a receivable which is
acceptable to the Bank in its sole discretion.
D. Borrowing Base Certificate: The sum of the Borrowing Base will be
determined each month by submission of a Borrowing Base
Certificate by the 20th of each month, accurate to the first day
of such month.
E. Maturity: The working Capital Facility will mature 2/1/96.
Consideration will be given at that time to the renewal of this
facility.
Term Loan Facility
A. Facility Amount and Purpose: The Term Loan Facility will be in
the amount of $4,400,000 and will be used for acquisition of TFI.
B. Interest: The Term Loan Facility will be evidenced by a
promissory note which will bear interest at 90-day Libor Rate,
plus 250 basis points, rate to change every 90 days.
C. Payments and Maturity: Interest only for the first 18 months,
payable quarterly. Then principal and interest paymentss to
amortize balance over 36 months, payable quarterly. The Term Loan
Facility will mature 8/1/99 after the date of the promissory
note.
Security
All Facilities: All facilities will be cross collateralized by a first lien
on all the Borrower's assets, tangible and intangible, including
assignments of material leases and contracts.
Financial Ratios:
The loan documentation evidencing the transactions shall contain covenants
regarding financial ratios restricting the Borrower which will be
established by Bank prior to closing.
Conditions Precedent to Closing
A. Completion of loan documents detailing the terms and conditions of the
financing which will include, but not necessarily be limited to,
affirmative and negative covenants, events of default, dividend,
borrowing, lending, and expenditure restrictions, as well as various
representations and warranties, all to be in form and substance
satisfactory to the Bank.
B. Execution and delivery of documents creating a first perfected
security interest in favor of the Bank, as outlined in "Security,"
above.
C. Execution and delivery of all other collateral and closing
documentation as the Bank may require, in form and substance
satisfactory to the Bank and the resolution of any business and legal
issues that may arise.
D. Representation from the Borrower that there has not been a material
adverse change in either its financial position or any other matters
in which the Bank reviewed in its evaluation of the credit request.
Expenses
The Borrower shall reimburse the Bank for all costs and fees (including
legal expenses) incurred by the Bank in connection with the preparation,
negotiation, and execution of loan documentation.
Deposit Accounts
The Borrower will maintain all deposit accounts at the Bank so long as any
loans to Bank are outstanding.
Term Sheet
This Term Sheet sets forth the principal terms and conditions upon which
the Bank will make credit facilities described herein available to the
Borrower but does not constitute a binding commitment to do so. The Bank
shall not have any duty to make any advance under any of such credit
facilities until execution and delivery of loan documents described herein
and in form and substance satisfactory to the Bank and such satisfaction of
all conditions precedent set for in such loan documents.
Closing Date
The credit facilities described herein shall be fully documented and closed
on or before 4/1/95.
If you wish to proceed with negotiations based upon this Term Sheet, please
execute a copy of this Term Sheet and return it to me by 4/1/95.
Firstar Bank Cedar Rapids, N.A.
By: /s/ Dirk A. Thierer
Dirk A. Thierer, Vice President
Cycle Sat
By: /s/ William B. Grandy
William B. Grandy, CFO
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<ARTICLE> 5
<S> <C>
<MULTIPLIER> 1,000
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> AUG-26-1995
<PERIOD-END> FEB-25-1995
<CASH> 0
<SECURITIES> 3,080
<RECEIVABLES> 46,170
<ALLOWANCES> 1,934
<INVENTORY> 66,704
<CURRENT-ASSETS> 127,414
<PP&E> 127,904
<DEPRECIATION> 85,788
<TOTAL-ASSETS> 200,052
<CURRENT-LIABILITIES> 52,191
<BONDS> 0
<COMMON> 12,913
0
0
<OTHER-SE> 84,030
<TOTAL-LIABILITY-AND-EQUITY> 200,052
<SALES> 115,448
<TOTAL-REVENUES> 115,448
<CGS> 98,037
<TOTAL-COSTS> 98,037
<OTHER-EXPENSES> 12,344
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (1,018)
<INCOME-PRETAX> 6,085
<INCOME-TAX> (6,000)
<INCOME-CONTINUING> 12,085
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 12,085
<EPS-PRIMARY> .48
<EPS-DILUTED> 0
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