SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Mark One)
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended June 30, 1997
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 1-3846
CHRISTIANA COMPANIES, INC.
(Exact name of registrant
as specified in its charter)
Wisconsin 95-1928079
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
700 N. Water Street, Suite 1200
Milwaukee, Wisconsin 53202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 291-9000
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on Which Registered
Common Stock - $1.00 par value New York Stock Exchange
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 if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]
_______________
The aggregate market value (based on December 31, 1997 closing price) of
voting stock less stock owned by all executive officers and directors as a
group: $69,173,283.25
Number of shares outstanding of the Company's Common Stock as of
December 31, 1997: 5,149,330
_______________
COMPANY'S DOCUMENTS INCORPORATED BY REFERENCE:
None
<PAGE>
The undersigned registrant hereby amends its Annual Report on
Form 10-K for the fiscal year ended June 30, 1997, as filed on September
29, 1997, to add the information required pursuant to Part III of Form 10-
K. These items had been incorporated by reference to the registrant's
definitive Proxy Statement for its 1997 annual meeting of shareholders
which was not held due to the registrant entering into an Agreement and
Plan of Merger (the "Merger Agreement"), dated as of December 12, 1997, by
and among EVI, Inc., a Delaware corporation ("EVI"), Christiana
Acquisition, Inc., a Wisconsin corporation and wholly owned subsidiary of
EVI ("Sub"), the Company and C2, Inc., a Wisconsin corporation ("C2"),
pursuant to which the Company will merge with and into Sub and become a
wholly owned subsidiary of EVI. Immediately prior to the Merger, C2 will
acquire a two-thirds interest in the registrant's principal operating
entity, Total Logistic Control, LLC, a Delaware limited liability company
("TLC"). The registrant will hold a special meeting of its shareholders
to consider and vote upon the Merger. It is anticipated that this special
meeting will be held in April of 1998.
Part III
Item 10. Directors and Executive Officers
The following table provides certain information, as of December
31, 1997, about the members of the Board of Directors and also provides
information about the beneficial ownership of the Company's capital stock
by all of the directors and executive officers as a group. The persons
shown in the table as officers of the Company comprise all of the
Company's executive officers. Directors of the Company are elected
annually by a plurality of the votes cast by shareholders. Executive
officers are appointed annually by the Board of Directors.
<TABLE>
<CAPTION>
Served as No. of Shares
Principal Occupation Director Beneficially
Name (and Age) During Last Five Years Since Owned
<S> <C> <C> <C>
Nicholas F. Brady (67) . . . . Chairman and President (since 2/93) of Darby 10/93 200,000 (1)
Advisors, Inc., Easton, Maryland, private (3.9%)
investment company (1)
William T. Donovan (45) . . . . President and Chief Financial Officer of the 10/90 163,532 (2)
Company (2) (3.2%)
Raymond F. Logan (74) . . . . . Former Vice President (Real Estate) of the 10/90 1,575
Company (.03%)
David J. Lubar (43) . . . . . . President of Lubar & Co. Incorporated ("Lubar & 10/90 205,000 (3)
Co."), venture capital and investments, (4.0%)
Milwaukee, Wisconsin (3)
Sheldon B. Lubar (68) . . . . . Chairman and Chief Executive Officer of the 1/87 2,513,000 (4)
Company (4) (48.8%)
Albert O. Nicholas (66) . . . . Owner and President of Nicholas Company, Inc., 1/90 310,700 (5)
Milwaukee, Wisconsin, a registered investment (6.0%)
adviser (5)
John R. Patterson (50) . . . . President and Chief Executive Officer of Total 10/96 25,000 (6)
Logistic Control, LLC (6) (.48%)
Gary R. Sarner (51) . . . . . . Chairman of Total Logistic Control, LLC (7) 10/92 51,000 (7)
(.99%)
All directors and executive officers as a group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,469,807(8)
(67.38%)
_____________
(1) Previously, Secretary of the United States Department of the Treasury
for over four years, and before that, Chairman of Dillon, Read & Co.,
Inc. He is also a director of Amerada Hess Corporation and H.J.
Heinz Company, as well as a director (or trustee) of 27 Templeton
Funds, which are registered investment companies. The shares listed
are owned by a trust of which Mr. Brady is the beneficiary and a co-
trustee.
(2) Mr. Donovan has served in the capacity listed or in another capacity
as an executive officer of the Company for more than the last five
years. He has also been a principal of Lubar & Co. for more than the
last five years. Mr. Donovan is also a director of Grey Wolf, Inc.
The shares listed include 10,000 shares subject to acquisition upon
exercise of employee stock options currently exercisable or
exercisable within 60 days from the date hereof.
(3) In addition to the shares listed, Mr. Lubar holds a voting trust
certificate for 222,403 shares; see Item 12.
(4) Mr. Lubar has also been a principal of Lubar & Co. for more than the
last five years. Mr. Lubar is also a director of Ameritech
Corporation, EVI, Inc., Firstar Corporation, Massachusetts Mutual
Life Insurance Co. and MGIC Investment Corporation. For additional
information about the shares listed, see Item 12.
(5) Nicholas Company is the adviser to six registered investment
companies: Nicholas Fund, Inc., Nicholas II, Inc., Nicholas Income
Fund, Inc., Nicholas Limited Edition, Inc., Nicholas Money Market
Fund, Inc. and Nicholas Equity Income Fund. Mr. Nicholas is the
president and a director of each of those companies. Mr. Nicholas is
also a director of Bando McGlocklin Capital Corporation.
(6) Total Logistic Control, LLC is a wholly-owned subsidiary of the
Company which provides public and contract warehousing and logistic
services. Mr. Patterson has served in the capacity listed since
February 1996. Before joining Total Logistic Control, LLC, Mr.
Patterson served as Vice President-Operations for Schneider Logistics,
Inc., Green Bay, Wisconsin (a provider of transportation and logistics
services). For six years prior thereto, Mr. Patterson was the
President and principal owner of Pro Drive, Inc., Green Bay,
Wisconsin (a truck driver recruiting and training firm). The shares
listed include 12,300 shares subject to acquisition upon exercise of
employee stock options currently exercisable or exercisable within 60
days from the date hereof.
(7) Chairman of Total Logistic Control, LLC since January 1994. Before
that, Mr. Sarner was the President of Wiscold, Inc., the business of
which was acquired by the Company in September 1992. The shares
listed include 45,000 shares subject to acquisition upon exercise of
employee stock options currently exercisable or exercisable within 60
days from the date hereof.
(8) Does not include shares for which Messrs. Donovan, Sarner and
Patterson hold options that are not currently exercisable or
exercisable within 60 days of the date hereof.
</TABLE>
Sheldon B. Lubar is the father of David J. Lubar.
During fiscal 1997, the Board of Directors met four times. Each
director attended at least 75% of the aggregate of (i) the total number of
all Board meetings and (ii) the total number of meetings of committees of
which he was a member. The Board has two standing committees: audit and
compensation (see Item 11). It has no standing nominating committee or
any committee performing similar functions.
Item 11. Executive Compensation
Summary Compensation Table. This table gives information about
the compensation of the four persons who were executive officers of the
Company during fiscal 1997.
<TABLE>
<CAPTION>
Long-Term
Compensation
Fiscal Annual Compensation Shares Underlying All Other
Name and Principal Position Year Salary Bonus Options (#) (1) Compensation(2)
<S> <C> <C> <C> <C> <C>
Sheldon B. Lubar, . . . . . . . 1997 $66,000 -- -- 750
Chairman and Chief 1996 66,000 -- -- 750
Executive Officer 1995 80,000 -- -- 750
William T. Donovan, . . . . . . 1997 $150,000 $100,000 15,000 750
Executive Vice President 1996 150,000 -- -- 750
and Chief Financial Officer 1995 127,500 75,000 -- 750
Raymond F. Logan, . . . . . . . 1997 $149,700 -- -- --
Vice President 1996 149,700 -- -- --
1995 149,700 $17,500 -- --
Gary R. Sarner, . . . . . . . . 1997 $167,500 $15,000 -- 750
Chairman of Total Logistic 1996 167,500 -- -- 750
Control, LLC 1995 150,000 35,000 -- 750
John R. Patterson (3), . . . . 1997 $175,000 $40,000 -- 750
President and Chief 1996 175,000 25,000 100,000 2,150(3)
Executive Officer of
Total Logistic Control, LLC
___________
(1) The Company's only long-term compensation plan or program is the 1995
Stock Option Plan. The amounts shown are the number of shares
underlying options granted during the fiscal year.
(2) This column consists solely of amounts contributed by the Company to
a Section 401(k) retirement plan.
(3) Mr. Patterson joined the Company's wholly-owned subsidiary, Total
Logistic Control, LLC in February 1996. In fiscal 1997, the Company
paid life insurance premiums in the amount of $2,150 on a term
life policy maintained by the Company for Mr. Patterson's benefit.
</TABLE>
Options Granted in Fiscal 1997. The table below sets forth
information regarding Incentive Stock Options granted in Fiscal 1997 to
William T. Donovan.
<TABLE>
<CAPTION>
Potential Realizable Value at
Assumed Annual Rates
Percentage of of Stock Price
Shares Total Options Appreciation For
Underlying Granted to all Exercise Option Term(3)
Options Employees in Price(2)
Name Granted(1) 1997 Fiscal Year (per share) Expiration Date 5% 10%
<S> <C> <C> <C> <C> <C> <C>
William T. Donovan 15,000 37.5% $21.50 August 15, 2006 $188,000 $514,000
---------------
(1) The options reflected in the table are Incentive Stock Options under
the Internal Revenue Code and were granted on August 15, 1996. The
exercise price of the options were equal to 100% of the fair market
value of the Common Stock on the date of grant. The options granted
to Mr. Donovan vest in five equal consecutive annual installments.
(2) The exercise price of options may be paid in cash, by delivering
previously issued Common Stock or any combination thereof.
(3) The potential realizable values set forth under the columns represent
the difference between the stated option exercise price and the
market value of the Common Stock based on certain assumed rates of
stock price appreciation and assuming that the options are exercised
on their stated expiration date; the potential realizable values set
forth do not take into account applicable tax and expense payments
which may be associated with such option exercises. Actual
realizable value, if any, will be dependent on the future stock price
of the Common Stock on the actual date of exercise, which may be
earlier than the stated expiration date. The 5% and 10% assumed
rates of stock price appreciation over the ten-year exercise period
of the options used in the table above are mandated by rules of the
Securities and Exchange Commission and do not represent the Company's
estimate or projection of the future price of the Common Stock on any
date. There can be no assurance that the stock price appreciation
rates for the Common Stock assumed for purposes of this table will
actually be achieved.
</TABLE>
Fiscal Year-End Option Value Table. The table below gives
information about the number and value of unexercised options for the
Company's stock held by William T. Donovan, Gary R. Sarner and John R.
Patterson at June 30, 1997. The Company's other executive officers,
Sheldon B. Lubar and Raymond F. Logan, do not hold any options on the
Company's stock. The closing price (New York Stock Exchange, Composite
Transactions) on that date was $39.875 per share. At June 30, 1997 only
options whose exercise price was below $39.875 were in-the-money. For
these options, the value shown is the difference between $39.875 and the
exercise price for the number of options held. The value of options which
were not-in-the-money is shown as 0.
June 30, 1997
No. of Shares
Underlying Options Value of in-the-Money Options
Name Exercisable/Unexercisable Exercisable/Unexercisable
William T. Donovan. 10,000/15,000 $165,750/$248,625
Gary R. Sarner . . 45,000/50,000 $387,626/$436,250
John R. Patterson . 12,300/80,000 $192,188/$1,250,000
Pensions. The Company has no pension plans or programs.
Raymond F. Logan, who retired after 34 years of service with the Company,
receives a lifetime annuity (10-years) of $75,000 per year; after those
ten years the annual payment changes to $37,500 upon the death of Mr.
Logan or his wife and that payment continues until the death of the
survivor.
Compensation of Directors. Non-employee directors (Nicholas F.
Brady, David J. Lubar and Albert O. Nicholas) are each paid an annual
retainer of $15,000 for attendance at Board and committee meetings and
other consultations.
Employment Contracts. Except for Gary R. Sarner, no officer of
the Company has an employment contract. Mr. Sarner's contract, entered
into concurrently with the Wiscold acquisition provides for an annual base
salary of at least $150,000.
Compensation Committee Interlocks and Insider Participation.
The members of the Compensation Committee are Nicholas F. Brady, Sheldon
B. Lubar and Albert O. Nicholas. This Committee, which also administers
the Company's stock option program, met twice during fiscal 1997. Mr.
Lubar is the Company's principal officer and its principal shareholder
(see Item 12).
William T. Donovan, David J. Lubar and Sheldon B. Lubar are
officers and directors of Lubar & Co., and own 25%, 37.5% and 37.5% of its
stock, respectively. The Company's headquarters are in part of the
premises occupied by Lubar & Co., 700 North Water Street, Suite 1200,
Milwaukee, Wisconsin. The Company reimburses Lubar & Co. for its pro rata
share ($5,400 per month for fiscal 1997) of the rent, utilities and other
expenses of those premises. This amount is offset by Lubar & Co.
reimbursing the Company for its partial utilization of Company staff time
at a rate of $7,200 per month.
Compensation Committee Report. The Company's approach to
compensating its executive officers is different from that of many public
corporations. The Chief Executive Officer (Sheldon B. Lubar) makes his
recommendations for salaries (other than any determined by an employment
agreement) and bonuses to the Compensation Committee and those
recommendations are generally approved by the Committee. To date, the
factors considered by the CEO have been the financial performance of the
Company or the operating unit for which the executive has responsibility
and achievement of non-financial goals in the business plan or developed
during the fiscal year. Financial performance is measured by actual
operating cash flow and net income compared to the amounts included in the
business plan developed prior to the beginning of the fiscal year, but any
secular developments affecting performance which may have occurred during
the fiscal year are considered. The CEO has not given any specific weight
to any one factor. In the case of compensation for Mr. Donovan, the CEO
has also taken into account his substantial holdings of the Company's
stock. Mr. Sarner's base salary was negotiated in connection with the
Wiscold acquisition. Mr. Patterson's base salary was negotiated in
connection with his hiring.
In recommending his own compensation for fiscal 1997, the CEO
took account of his substantial holdings of Company stock and his view
that his own compensation over the long term will largely be the result of
an increase in the market price of the Company's stock. The CEO also
considered his belief that his compensation was substantially below the
compensation of chief executive officers of companies of a similar size to
the Company.
Section 162(m) of the Internal Revenue Code of 1986, as amended,
limits deductibility for federal income tax purposes of compensation in
excess of $1 million paid to the CEO and certain executive officers unless
certain requirements are met. The Compensation Committee does not believe
that in the foreseeable future the annual compensation of any executive
officer will be subject to the limit. The Company's 1995 Stock Option
Plan limits the number of Awards that may be granted to any one person
during any three-year period. Hence, any tax deductible compensation to
an executive under that Plan resulting from an increase in the price of
the Company's stock (in general, tax deductible compensation is the
difference between the fair market of an Award when it is exercised less
any amount paid by the executive) will not be subject to the limit.
Five-Year Performance Table. The annual changes for the five-
year period shown in this table are based on the assumption that on June
30, 1992, $100 had been invested in the Company's Common Stock, and in the
S&P 500 Index and in the Russell 2000 Index, and that all dividends were
reinvested (the Company paid no dividends during the period). The total
cumulative dollar returns shown in the table represent the value that such
investments would have had at each anniversary shown. The Company has
chosen the Russell 2000 Index because it is not aware of any published
industry or line-of-business index for comparable companies nor is it
aware of any peer group of companies.
1992 1993 1994 1995 1996 1997
Christiana $100 $ 84.42 $117.75 $ 92.64 $ 73.59 $138.10
S&P 500 $100 $113.63 $115.23 $145.27 $183.04 $246.55
Russell 2000 $100 $125.96 $131.51 $157.90 $195.62 $227.56
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table gives information, as of December 31, 1997,
about the beneficial ownership of Common Stock of the Company by the
persons known to the Board of Directors to own beneficially more than 5%
of the outstanding Common Stock. As used in this proxy statement,
"beneficial ownership" has the meaning set forth in Rule 13d-3 of the
Securities Exchange Act of 1934.
No. of Shares Percent
Name and Address Beneficially Owned of Class
Sheldon B. Lubar, as Voting Trustee . 2,513,000 48.8%
Suite 1200
700 North Water Street
Milwaukee, WI 53202
Albert O. Nicholas . . . . . . . . . 310,700 6.0%
700 North Water Street
Milwaukee, WI 53202
Dimensional Fund Advisors Inc. . . . 285,000 5.2%
1299 Ocean Avenue
11th Floor
Santa Monica, CA 90401
Voting Trust and Voting Trust Certificates. With the exception
of 10,000 shares held by Mr. Lubar in an individual defined benefit plan,
all shares shown above for Mr. Lubar are owned of record and beneficially
by Mr. Lubar as the voting trustee under an agreement dated December 29,
1992, pursuant to which he has sole voting and dispositive power over
those shares. That agreement expires December 28, 2012, but is subject to
earlier termination or modification as therein provided. Voting Trust
certificates for those shares are held as follows: Mr. Lubar, 433,705
shares (8.4% of the Company's outstanding stock) and his wife, 433,705
shares (8.4%), their son David J. Lubar, 222,403 shares (4.3%), their
three daughters, 1,321,982 shares (25.7%), and trusts for the benefit of
their grandchildren, 91,205 shares (1.8%).
Item 13. Certain Relationships and Related Transactions
In connection with the Merger, each holder of common stock of
the Company will have the ability to subscribe for their pro rata portion
of 5,202,664 shares of common stock, $.01 par value per share of C2 for
$4.00 per share. Pursuant to the Merger Agreement and upon approval of
the shareholders of the Company, as of the effective date of the merger
each share of common stock of the Company will be converted into the
right to receive (i) approximately .74193 shares of EVI common stock
subject to certain adjustments based on the number of shares of the
Company's common stock outstanding on the effective date of the Merger;
(ii) cash in the approximate amount of $3.50 per share of Company common
stock, subject to adjustment based on the amount of certain Company
liabilities existing as of the effective date of the Merger; and (iii) a
contingent cash payment of approximately $1.92 which will be paid to the
shareholders of record after five years from the effective date of the
Merger, subject to any indemnity claims by EVI under the Merger Agreement.
See Item 10. for the number of shares of common stock of the
Company beneficially owned by the directors and officers of the Company
(including shares of common stock of the Company subject to options).
In connection with the Merger, Sheldon B. Lubar, David J. Lubar
and members of the Lubar family (collectively, the "Lubar Nominees") have
committed, pursuant to an agreement between C2 and Sheldon B. Lubar, dated
December 24, 1997, and certain related agreements, to exercise all of their
Basic Subscription Privileges in full and to purchase, if necessary, such
additional shares of common stock of C2 that will result in proceeds to C2
of at least $10,666,667 (after deducting for expenses associated with the
sale of such shares).
The Lubar Nominees, Lubar & Co., Venture Capital Fund, L.P., a
fund managed by Lubar & Co., and William T. Donovan own 5.3%, 0.8%, 6.0%
and 0.7% respectively, of Emmpak Foods, Inc., a customer of TLC. During
fiscal 1997, Emmpak Foods, Inc. accounted for approximately $2.1 million
in gross revenue for TLC. David J. Lubar serves on the board of directors
of Emmpak Foods, Inc.
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) 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.
Dated: January 26, 1998 CHRISTIANA COMPANIES, INC.
By: /s/ Sheldon B. Lubar
Sheldon B. Lubar, Chairman and
Chief Executive Officer
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
None.
