SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1998
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to _________
Commission File Number
1-8232
Name of Registrant
NBI, INC.
State of Incorporation IRS Employer I. D. Number
Delaware 84-0645110
Address
1880 Industrial Circle, Suite F
Longmont, Colorado 80501
(303) 684-2700
Check whether the issuer (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.
[X] YES [ ] NO
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at January 29, 1999
----- -----------------------------------
Common Stock, par value $.01 per share 8,088,320
Preferred Stock, par value $.01 per share 500,000
<PAGE>
NBI, INC.
INDEX TO FORM 10-QSB
For Quarter Ended December 31, 1998
<TABLE>
<CAPTION>
PAGE
----
PART I - FINANCIAL INFORMATION
<S> <C>
Consolidated Financial Statements (Unaudited) 3 - 6
Supplementary Notes to Consolidated Financial
Statements (Unaudited) 7 - 11
Management's Discussion and Analysis of Financial Condition
and Results of Operations 12 - 15
PART II - OTHER INFORMATION 16
</TABLE>
<PAGE>
NBI, INC.
CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands Except Share Data)
<TABLE>
<CAPTION>
December 31, June 30,
1998 1998
---------- ----------
(Unaudited)
<S> <C> <C>
ASSETS
-----------
Current assets:
Cash and cash equivalents $ 1,780 $ 209
Accounts receivable, less allowance for doubtful
accounts of $93 and $69, respectively 1,810 1,375
Inventories 2,537 2,750
Other current assets 207 156
-------- --------
Total current assets 6,334 4,490
Property, plant and equipment, net 7,667 7,436
Other assets 170 279
Net long-term assets of discontinued operations 25 --
-------- --------
$14,196 $12,205
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
---------------------------------------
Current liabilities:
Short-term borrowings and current portion
of notes payable $ 1,691 $ 1,846
Current portion of IRS debt and other income taxes payable 1,860 3,527
Accounts payable 1,321 1,200
Accrued liabilities 786 796
Net current liabilities of discontinued operations 30 --
-------- --------
Total current liabilities 5,688 7,369
Long-term liabilities:
Income taxes payable -- 1,778
Notes payable 1,276 1,351
Deferred income taxes 223 223
Postemployment disability benefits 177 184
-------- --------
Total liabilities 7,364 10,905
-------- --------
Commitments and contingencies
Stockholders' equity:
Preferred stock - $.01 par value; 5,000,000 shares
authorized; 500,000 shares of Series A Cumulative Preferred
Stock issued at December 31, 1998 5 --
Capital in excess of par value - preferred stock 4,843 --
Common stock - $.01 par value; 20,000,000 shares
authorized; 10,115,520 shares issued 101 101
Capital in excess of par value - common stock 6,280 6,280
Accumulated deficit (3,529) (4,213)
-------- --------
7,700 2,168
Less treasury stock at cost (2,027,200 shares) (868) (868)
-------- --------
Total stockholders' equity 6,832 1,300
-------- --------
$14,196 $12,205
========= ========
<FN>
See accompanying notes.
</TABLE>
<PAGE>
NBI, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands Except Per Share Data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
December 31, December 31,
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Sales $4,331 $3,081 $8,229 $6,084
Service and rental 573 519 1,252 1,155
------- ------- ------- -------
4,904 3,600 9,481 7,239
Costs and expenses:
Cost of sales 2,942 2,326 5,624 4,444
Cost of service and rental 441 402 879 816
Marketing, general and administrative 873 802 1,707 1,573
------- ------- ------- -------
4,256 3,530 8,210 6,833
------ ------- ------- -------
Income from operations 648 70 1,271 406
Other income (expense):
Net loss on investments -- -- -- (39)
Other income and expenses, net 21 15 53 24
Interest expense (67) (183) (140) (365)
------- ------- ------- -------
(46) (168) (87) (380)
------ ------- ------- -------
Income (loss) from continuing operations before
income tax benefit (provision) 602 (98) 1,184 26
Income tax benefit (provision) (168) 5 (262) (49)
------- ------- ------- -------
Income (loss) from continuing operations 434 (93) 922 (23)
Loss from discontinued operations,
net of income tax benefits of $94, $0, $123 and
$26, respectively (183) (84) (238) (135)
------- ------- ------- -------
Net income (loss) $ 251 $ (177) $ 684 $ (158)
======= ======= ======= =======
Income (loss) per common share - basic:
Income (loss) before discontinued operations $ .05 $ (.01) $ .11 $ --
Loss from discontinued operations (.02) (.01) (.03) (.02)
------- ------- ------- -------
Net income (loss) $ .03 $ (.02) $ .08 $ (.02)
======= ======= ======= =======
Income (loss) per common share - diluted:
Income (loss) before discontinued operations $ .05 $ (.01) $ .11 $ --
Loss from discontinued operations (.02) (.01) (.03) (.02)
------- ------- ------- -------
Net income (loss) $ .03 $ (.02) $ .08 $ (.02)
======= ======= ======= =======
Weighted average number of common
shares outstanding 8,088 8,088 8,088 8,066
======= ======= ======= =======
<FN>
See accompanying notes.
</TABLE>
<PAGE>
NBI, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
December 31,
1998 1997
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 684 $(158)
Adjustments to reconcile net income (loss) to net cash
flow provided by (used in) operating activities:
Depreciation and amortization 386 358
Provision for bad debts and returns 42 47
Provision for writedown of inventory 110 15
Provision for impairment of property and equipment and other
long-term assets 53 --
Loss (gain) on sales of property and equipment (8) 51
Net unrealized gain on trading securities -- (53)
Compensation expense related to stock option extensions -- 37
Other 12 1
Changes in assets -- decrease (increase):
Accounts receivable (486) (54)
Inventory 69 58
Other current assets (70) (50)
Other assets 70 (82)
Changes in liabilities -- (decrease) increase:
Obligations for short-sale transactions -- (58)
Accounts payable and accrued liabilities 214 122
Income tax related accounts (3,445) (29)
-------- ------
Net cash flow provided by (used in) by operating activities (2,369) 205
-------- ------
Cash flows from investing activities:
Proceeds from sales of property and equipment 9 2
Purchases of property and equipment (666) (395)
-------- ------
Net cash flow used in investing activities (657) (393)
-------- ------
Cash flows from financing activities:
Collections on note receivable 4 3
Proceeds from issuance of preferred stock, net of offering costs 4,848 --
Proceeds from borrowings -- 100
Proceeds from stock option exercises -- 29
Payments on notes payable (131) (141)
Net payments on line of credit (102) (12)
-------- ------
Net cash flow provided by (used in) financing activities 4,619 (21)
-------- ------
Net increase (decrease) in cash and cash equivalents 1,593 (209)
Increase in cash and cash equivalents included in net current liabilities of
discontinued operations at December 31, 1998 (22) --
Cash and cash equivalents at beginning of period 209 333
-------- ------
Cash and cash equivalents at end of period $ 1,780 $ 124
======== ======
<FN>
See accompanying notes.
</TABLE>
<PAGE>
NBI, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
December 31,
1998 1997
---- ----
<S> <C> <C>
Supplemental disclosures of cash flow information:
Interest paid $ 137 $ 228
====== =====
Income taxes paid $ 3,551 $ 60
====== =====
Noncash purchases of property, plant and equipment
included in accounts payable at end of period $ 237 $ 90
====== =====
<FN>
See accompanying notes.
</TABLE>
<PAGE>
NBI, INC.
SUPPLEMENTARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Basis of Preparation
- ----------------------------------
The accompanying financial statements have been prepared in accordance with
the requirements of Form 10-QSB and include all adjustments which in the
opinion of management are necessary in order to make the financial statements
not misleading. The consolidated financial statements include the accounts of
the Company and its wholly-owned and majority-owned subsidiaries. All
significant intercompany accounts and profits have been eliminated.
Note 2 - Discontinued Operations
- ------------------------------------
On February 1, 1999, the Company established a plan to dispose of its Krazy
Colors, Inc. operation. Therefore, it has separately reported the losses from
this segment as discontinued operations for the three and six months ended
December 31, 1998 and 1997. The Company has estimated the net realizable
value of the disposal of the discontinued operation, including estimated costs
and expenses directly associated with the disposal and estimated losses from
operations through the disposal date, and has recorded losses from
discontinued operations as follows:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
December 31, December 31,
1998 1997 1998 1997
---- ---- ---- ----
(Amounts in thousands)
<S> <C> <C> <C> <C>
Revenues $ 64 $ 100 $ 95 $ 182
====== ===== ====== ======
Loss from operations before income taxes $ (79) (84) (163) (161)
Income tax benefit 27 -- 56 26
------ ----- ------ ------
Loss from operations (52) (84) (107) (135)
Estimated loss on disposal (including
provision for operating losses
through disposition date) (198) -- (198) --
Income tax benefit 67 -- 67 --
------ ----- ------ ------
Loss from discontinued operations $(183) $(84) $(238) $(135)
====== ===== ====== ======
</TABLE>
Note 3 - Cash and Cash Equivalents
- ----------------------------------------
Cash and cash equivalents include investments that are readily convertible to
known amounts of cash and have original maturities of six months or less. The
Company places its cash and temporary cash investments with financial
institutions. At times, such investments may be in excess of federally
insured limits.
Note 4 - Investments in Securities and Obligations from Short-Sale
- ---------------------------------------------------------------------------
Transactions
- ------------
The Company held no investments and had no realized or unrealized gains or
losses for the quarter or six months ended December 31, 1998. The Company
also held no investments for the quarter ended December 31, 1997. During the
six months ended December 31, 1997, all of the Company's securities were
classified as trading securities; no securities were classified as
held-to-maturity or available-for-sale. An unrealized gain of $53,000 and a
realized loss of $92,000 were recorded for the six months ended December 31,
1997.
<PAGE>
NBI, INC.
SUPPLEMENTARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
As part of its investment policy, the Company's investment portfolio may
include option instruments and may include a concentrated position in one or
more securities. As a result of this, the financial results may fluctuate
significantly and have larger fluctuations than with a more diversified
portfolio. In addition, the Company may invest in short-sale transactions of
trading securities. Short-sales can result in off-balance sheet risk, as
losses can be incurred in excess of the reported obligation if market prices
of the securities subsequently increase. At December 31, 1998, the Company
had no investment positions.
Note 5 - Inventories
- -----------------------
Inventories are comprised of the following:
<TABLE>
<CAPTION>
December 31,
1998
----
(Amounts in thousands)
<S> <C>
Raw materials $ 829
Work in process 451
Finished goods 1,238
Food and beverage inventory 19
------
$2,537
=======
</TABLE>
Note 6 - Income Taxes
- -------------------------
IRS Debt:
- ----------
On April 28, 1998, the Company and the Internal Revenue Service ("IRS")
entered into an amended payment agreement, revising the payment terms related
to NBI Inc.'s IRS debt of $5,278,000. This agreement, effective as of April
9, 1998, revised the terms of the agreement in principal with the IRS
effective October 1, 1995 and the original settlement agreement with the IRS
dated June 12, 1991, with respect to NBI's federal tax liabilities for the
fiscal years ended June 30, 1980 through 1988. Under the new agreement,
$3,500,000 of the IRS debt was due on or before December 31, 1998, and the
remaining balance of $1,778,000 is due on or before December 31, 1999. The
IRS debt continues to be collateralized by a security interest in all of the
capital stock of American Glass, Inc. and NBI Properties, Inc. Provided no
event of default occurs prior to payment of the IRS debt in full, NBI will not
be obligated to pay any past, current or future interest related to the debt.
On December 31, 1998, the Company paid the IRS the $3.5 million installment
due on that date from the proceeds of its preferred stock offering (see Note
7).
Income tax provision:
- -----------------------
For the six months ended December 31, 1998 and 1997, the Company recorded
provisions for income taxes from continuing operations of $262,000 and
$49,000, respectively. These provisions include state and other income taxes
and are based upon book income.
In accordance with fresh start accounting, which was adopted as of April 30,
1992, and as a result of the Company's reorganization under Chapter 11 of the
U.S. Bankruptcy Code, utilization of any income tax benefit from
pre-reorganization net operating losses is not credited to the income tax
provision, but rather, reported as an addition to capital in excess of par
value. No pre-reorganization net operating losses were utilized for the six
months ended December 31, 1998 and 1997.
<PAGE>
NBI, INC.
SUPPLEMENTARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 7 - Stockholders' Equity
- ---------------------------------
The Company has authorized 20,000,000 shares of $.01 par value common stock.
At December 31, 1998, 10,115,520 shares were issued including 2,027,200 held
in treasury. Therefore, the Company had 8,088,320 shares issued and
outstanding at December 31, 1998.
At the Company's annual meeting held on October 14, 1998, the stockholders
approved an amendment to the Company's Certificate of Incorporation
authorizing issuance of up to 5,000,000 shares of preferred stock with a par
value of $.01 per share. The Company has designated 2,000,000 preferred
shares as Series A Cumulative Preferred Stock with cumulative dividends from
the date of original issue, accruing semi-annually, commencing June 30, 1999,
and each December 31 and June 30 thereafter, at the annual rate per share of
either (a) $1.00 in cash, or (b) .11 additional shares of Series A Preferred
Stock, at the option of the holder, until December 31, 2004. Subsequent to
December 31, 2004, the annual dividend rate per share will increase to either
(a) $1.10 in cash or (b) .12 additional shares of Series A Preferred Stock,
at the option of the holder. The Series A Cumulative Preferred Stock has a
liquidation preference of $10 per share and is entitled to receive all accrued
and unpaid dividends through the date of distribution. In addition, the
Series A Cumulative Preferred Stock is redeemable at the option of the Company
beginning January 1, 1999. The redemption price would be as follows for each
calendar year: $11.00 per share if redeemed in 1999, $10.80 in 2000, $10.60 in
2001, $10.40 in 2002, $10.20 in 2003, and $10.00 in 2004 or thereafter.
The Company has registered and reserved 1,000,000 shares of the Series A
Cumulative Preferred Stock through its Registration Statement on Form SB-2,
effective November 9, 1998, in connection with its public offering of units
consisting of one share of the Series A Cumulative Preferred Stock and two
warrants to purchase the Company's common stock at $1.20 per share. In
addition, 550,000 shares of the Series A Cumulative Preferred Stock and
2,000,000 shares of the Company's common stock have been registered and
reserved for payment-in-kind of the preferred stock dividends and for the
exercise of the common stock purchase warrants, respectively.
As of December 31, 1998, the Company had sold 500,000 units and thus issued
500,000 shares of Series A Cumulative Preferred Stock and 1,000,000 common
stock purchase warrants in connection with this offering. The Company filed
the related amendments to its Certificate of Incorporation and Certificate of
Designation with the Delaware Secretary of State during the quarter ended
December 31, 1998.
The stockholders also approved an amendment that allows the Company to effect
a reverse stock split of either 1 for 2.5, 1 for 3, or 1 for 4 shares, at the
discretion of the Board of Directors. Further, the Board of Directors has the
discretion not to effect a reverse stock split, and to-date, has not taken any
action.
Note 8 - Net Income (Loss) Per Common Share
- ---------------------------------------------------
During the Company's second quarter of fiscal 1998, NBI, Inc. adopted
Statement of Financial Accounting Standards ("SFAS") No. 128 issued by the
Financial Accounting Standards Board. SFAS No. 128 provides for the
calculation of "Basic" and "Diluted" earnings per share. Basic earnings per
share includes no dilution and is computed by dividing income (loss) available
to common shareholders by the weighted average number of common shares
outstanding for the period. Diluted earnings per share reflects the potential
dilution of securities that could share in the earnings of the entity, similar
to fully diluted earnings per share.
<PAGE>
NBI, INC.
SUPPLEMENTARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The following reconciles the numerators and denominators of the basic and
diluted earnings per common share computation for net income:
<TABLE>
<CAPTION>
For the three months ended
December 31,
1998 1997
---- ----
Basic Diluted Basic Diluted
----- ------- ----- -------
(Amounts in thousands
except per share data)
<S> <C> <C> <C> <C>
Income (loss) before discontinued operations $ 434 $ 434 $ (93) $ (93)
====== ====== ======= =======
Weighted average number of common
shares outstanding 8,088 8,088 8,088 8,088
====== =======
Assumed conversions of stock options 295 --
------ -------
8,383 8,088
====== =======
Income (loss) per common share
before discontinued operations $ .05 $ .05 $ (.01) $ (.01)
====== ====== ======= =======
</TABLE>
<TABLE>
<CAPTION>
For the six months ended
December 31,
1998 1997
---- ----
Basic Diluted Basic Diluted
----- ------- ----- -------
(Amounts in thousands
except per share data)
<S> <C> <C> <C> <C>
Income (loss) before discontinued operations $ 922 $ 922 $ (23) $ (23)
====== ====== ======= =======
Weighted average number of common
shares outstanding 8,088 8,088 8,066 8,066
====== =======
Assumed conversions of stock options 274 --
------ -------
8,362 8,066
====== =======
Income (loss) per common share
before discontinued operations $ .11 $ .11 $ -- $ --
====== ====== ======= =======
</TABLE>
For the three and six months ended December 31, 1998, all stock options and
warrants outstanding, except for the warrants with an exercise price of $1.20,
were included in the computation of diluted earnings per share because their
exercise prices were less than the average market price of the common stock
during such period. Because the Company incurred net losses before
discontinued operations for the three and six months ended December 31, 1997,
none of its outstanding options or warrants were included in the computation
of diluted earnings per share as their effect would be anti-dilutive.
<PAGE>
NBI, INC.
SUPPLEMENTARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The options and warrants outstanding at December 31, 1998 were as follows:
<TABLE>
<CAPTION>
Number
Exercise Outstanding at
Price December 31, 1998
----- -------------------
<S> <C> <C>
Stock options:
$ .38 216,000
$ .59 100,500
$ .77 400,000
$ .88 244,000
Warrants:
$ .89 1,700,000
$ 1.20 1,000,000
---------
3,660,500
=========
</TABLE>
Note 9 - Comprehensive Income
- ---------------------------------
Effective July 1, 1998, the Company has adopted the provisions of SFAS No.
130, "Reporting Comprehensive Income." Comprehensive income includes all
changes in equity except those resulting from investments by owners and
distribution to owners. For the six months ended December 31, 1998 and 1997,
the Company had no items of comprehensive income other than net income;
therefore, a separate statement of comprehensive income has not been presented
for these periods.
Note 10 - Seasonal Variations of Operations
- -------------------------------------------------
L.E. Smith Glass Company ("L.E. Smith") and the Belle Vernon Holiday Inn
typically have their strongest revenue performance during the first fiscal
quarter due to seasonal variations in these businesses. Generally, the second
and fourth fiscal quarters' revenues from these operations are moderately
lower than in the first quarter, while the third fiscal quarter's revenue is
usually significantly lower than the other quarters. However, in fiscal 1998,
L.E. Smith received several large orders from its significant customer during
the historically slower quarters, which created a more consistent revenue
stream for the year. In addition, during the second quarter of fiscal 1999,
L.E. Smith experienced a significant increase in revenues compared to the
first quarter of fiscal 1999, primarily due to a significant increase in
revenues from its significant customer. The Company is unsure whether these
trends will continue.
<PAGE>
NBI, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SECOND QUARTER, FISCAL YEAR 1999
The statements in this discussion contain both historical and
"forward-looking" statements, as such term is defined in "The Private
Securities Litigation Reform Act of 1995". The forward-looking statements are
based upon current expectations and the actual results could differ materially
from those anticipated. Factors that may affect such forward-looking
statements include, among others, ability to obtain financing, loss of
significant customers, reliance on key personnel, competitive factors and
pricing pressures, availability of raw materials, labor disputes, investment
results, adequacy of insurance coverage, inflation and general economic
conditions.
RESULTS OF OPERATIONS
Revenues from continuing operations for the second quarter of fiscal year 1999
increased $1.3 million, or 36.2%, to $4.9 million, from $3.6 million in the
second quarter of the prior fiscal year. Year-to-date, revenues totaled $9.5
million for the six months ended December 31, 1998, an increase of $2.2
million, or 31.0%, compared to the same period of fiscal 1998.
The revenue improvement was primarily attributable to increased sales revenue
from the L.E. Smith Glass Company ("L.E. Smith"). Sales revenue from L.E.
Smith increased $1,250,000, or 40.6%, to $4,331,000 for the second quarter of
fiscal 1999, and increased $2,145,000, or 35.3%, to $8,229,000 for the six
months ended December 31, 1998, as compared to the same periods in the
previous fiscal year. The increased volume at L.E. Smith included a
significant amount of revenues from new customers, as well as a significant
increase in orders from its largest customer. In addition, during the second
quarter of fiscal 1999, L.E. Smith experienced a significant increase in
revenue growth from its existing customers as compared to the second quarter
of fiscal 1998.
Service and rental revenue from continuing operations increased moderately
from $519,000 and $1,155,000 for the three and six months ended December 31,
1997, respectively, to $573,000 and $1,252,000 for the same periods in fiscal
year 1999. The increased revenue was primarily related to a moderate increase
in both occupancy rates and average daily room rates of the Belle Vernon
Holiday Inn.
Total revenues from continuing operations are expected to increase moderately
for the three months ended March 31, 1999, as compared to the same period in
the prior fiscal year, resulting primarily from sustained growth from new and
existing customers at L.E. Smith. However, revenues for the third quarter of
fiscal 1999 are expected to decrease significantly compared to the second
quarter of fiscal 1999, as seasonal variations historically cause the third
fiscal quarter to be the lowest revenue quarter for both L.E. Smith and the
Belle Vernon Holiday Inn.
Cost of sales, service and rental was $3.4 million, or 69.0% of total revenue,
and $6.5 million, or 68.6% of total revenue, for the three and six months
ended December 31, 1998, respectively. Comparable figures for the same
periods in fiscal 1998 were $2.7 million and $5.3 million, or 75.8% and 72.7%
of total revenues, respectively.
Cost of sales as a percentage of sales revenue for the three and six months
ended December 31, 1998 was 67.9% and 68.3%, respectively, compared to 75.5%
and 73.0% for the same periods in fiscal 1998. The resulting improvement in
gross margin was primarily due to increased volume and production efficiency
at L.E. Smith, causing favorable absorption of fixed costs, partially offset
by general cost increases including increased labor costs associated with a
new labor contract.
Cost of service and rental as a percentage of service and rental revenue was
77.0% and 70.2% for the three and six months ended December 31, 1998,
respectively, compared to 77.5% and 70.6% for the same periods in the prior
fiscal year. The slight improvement in the related gross margin was primarily
due to the increased revenue volume available to cover fixed costs, partially
offset by general cost increases.
<PAGE>
NBI, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SECOND QUARTER, FISCAL YEAR 1999 - CONTINUED
Cost of sales, service and rental as a percentage of total revenue for the
third quarter of fiscal 1999 is expected to be slightly higher, compared to
the third quarter of fiscal 1998, due to lower margins from general cost
increases at both L.E. Smith and the Belle Vernon Holiday Inn, partially
offset by greater absorption of fixed costs at L.E. Smith resulting from the
projected increase in revenues. Cost of sales, service and rental as a
percentage of total revenue for the third quarter of fiscal 1999 is expected
to be moderately higher compared to the second quarter of fiscal 1999 due to
seasonally lower revenue volume at both L.E. Smith and the Belle Vernon
Holiday Inn available to cover fixed costs.
Marketing, general and administrative expenses totaled $873,000 and $802,000
for the three months ended December 31, 1998 and 1997, respectively.
Year-to-date, marketing, general and administrative expenses totaled
$1,707,000 for the six months ended December 31, 1998, an increase of $134,000
compared to expenses of $1,573,000 for the same period of fiscal 1998. The
increase in expenses was primarily related to increased expenses associated
with higher revenues at both L.E. Smith and the Belle Vernon Holiday Inn,
including increased sales commissions, product development expenses, franchise
and royalty fees and other sales and marketing expenses. Also during fiscal
1999, the Company had a decline in credits related to a reduction of a reserve
for incurred but not reported claims, because the Company previously converted
to a fully-insured health plan for its corporate and Krazy Colors employees.
In addition, the second quarter of fiscal 1999 included an accrual for a CEO
bonus, based upon the provisions of the CEO's employment agreement, whereas no
CEO bonus expense was incurred during fiscal 1998. These increases were
partially offset by the absence of executive severance accrued during the
second quarter of fiscal 1998. In addition, the year-to-date increase was
partially offset by the absence of a non-cash compensation expense for
extensions of certain executive stock options included during the first
quarter of fiscal 1998.
Marketing, general and administrative expenses are expected to increase
moderately for the three months ended March 31, 1999, as compared to the same
period in the prior fiscal year, primarily due to increased sales and
marketing activities. Marketing, general and administrative expenses are
expected to decrease moderately in the third quarter of fiscal 1999 compared
to the second quarter of fiscal 1999, primarily due to lower sales and
marketing expenses resulting from the expected decline in revenues.
The Company recorded no gain or loss on investments during the six months
ended December 31, 1998, compared to a net loss on investments of $39,000 for
the six months ended December 31, 1997. The Company recorded no gain or loss
on investments for the quarters ended December 31, 1998 or 1997. As part of
its investment policy, the Company's investment portfolio may include
investments in option instruments and may include a concentrated position in
one or more securities. As a result of this, the financial results may
fluctuate significantly and have larger fluctuations than with a more
diversified portfolio. In addition, the Company may invest in short-sale
transactions of trading securities. Short-sales can result in off-balance
sheet risk, as losses can be incurred in excess of the reported obligation if
market prices of the securities subsequently increase. At December 31, 1998,
the Company had no investment positions.
Interest expense totaled $67,000 and $140,000 for the three and six months
ended December 31, 1998, respectively, compared to $183,000 and $365,000 for
the same periods in the prior fiscal year. The decline was primarily related
to the absence of interest on the Company's IRS debt during fiscal 1999,
resulting from the restructured agreement with the IRS in April, 1998.
The Company recorded income tax provisions from continuing operations of
$168,000 and $262,000 for the three and six months ended December 31, 1998,
respectively, compared to an income tax benefit of $5,000 for the second
quarter of fiscal 1998 and an income tax provision of $49,000 for the six
months ended December 31, 1997. Included in these amounts are state
provisions of $74,000 and $139,000 for the three and six months ended December
31, 1998, respectively, compared to $12,000 and $57,000 for the same periods
in fiscal 1998. The state income tax provisions are primarily related to the
Company's Pennsylvania operations and are based upon
<PAGE>
NBI, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SECOND QUARTER, FISCAL YEAR 1999 - CONTINUED
book income, as NBI does not have any net operating loss carryforwards
available in Pennsylvania. The Company does have significant federal net
operating loss carryforwards, as well as significant net operating loss
carryforwards in several states, and, therefore, has no federal or other state
income taxes payable. In accordance with fresh start accounting, the income
tax benefit and provisions recorded do include non-cash charges to the extent
that the Company expects to use its pre-reorganization net operating loss
carryforwards. These charges are reported as an addition to capital in excess
of par value, rather than as a credit through the income tax provision. There
were no non-cash components included in the income tax provisions for the
three and six months ended December 31, 1998 or 1997.
DISCONTINUED OPERATIONS
On February 1, 1999, the Company established a plan to dispose of its Krazy
Colors, Inc. operation. Therefore, it has separately reported the operating
losses from this segment as discontinued operations for the three and six
months ended December 31, 1998 and 1997. The Company has also recorded an
estimated loss on disposal at December 31, 1998 based upon the estimated net
realizable value of the discontinued operation, including estimated costs and
expenses directly associated with the disposal and estimated losses from
operations through the disposal date. Losses from discontinued operations
totaled $183,000 and $238,000, for the three and six months ended December 31,
1998, respectively, net of income tax benefits of $94,000 and $123,000,
respectively. This compares to losses of $84,000 and $135,000 for the three
and six months ended December 31, 1997, respectively, net of income tax
benefits of $0 and $26,000, respectively. The increase in the loss from
discontinued operations for the three and six months ended December 31, 1998,
as compared to the same periods of the prior fiscal year, consisted primarily
of the estimated loss on disposal, including the estimated loss from
operations through its disposition.
At December 31, 1998, the net long-term assets of the discontinued operation
consisted primarily of equipment and the net current liabilities of the
discontinued operations consisted primarily of accounts payable and accrued
liabilities net of cash and inventory.
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
Total assets increased $2.0 million during the first six months of fiscal
1999, from $12.2 million at June 30, 1998, to $14.2 million at December 31,
1998. The Company had working capital of $646,000 at December 31, 1998,
compared to negative working capital of $2.9 million at June 30, 1998. The
improvement in working capital was primarily related to a public offering of
preferred stock with an initial closing on December 31, 1998 which raised $5.0
million, before associated expenses, of which $3.5 million was used to pay an
installment on the IRS debt which was due on or before that date (see Notes 6
and 7). This improvement in working capital was partially offset by the
reclassification of the remaining IRS debt of $1.8 million to current
liabilities at December 31, 1998.
The Company has a final installment of $1.8 million on the IRS debt which is
due on or before December 31, 1999. The Company expects to pay this
installment from a combination of cash on hand and internally generated funds,
including cash available from L.E. Smith through dividend payments to
the parent company. In addition, the Company may raise additional funds by
selling additional preferred stock through its outstanding preferred stock
offering.
The Company expects to pay the cash dividends on its recently issued preferred
stock through internally generated funds, including cash available from
L.E.Smith through dividend payments to the parent company.
<PAGE>
NBI, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
SECOND QUARTER, FISCAL YEAR 1999 - CONTINUED
The Company is currently pursuing various financing options for its real
estate development activities of its NBI Development Corporation subsidiary.
The Company expects its other working capital requirements in the next fiscal
year to be met by existing working capital at December 31, 1998, internally
generated funds and, for L.E. Smith Glass Company's requirements, short-term
borrowings under an existing line of credit.
YEAR 2000 COMPLIANCE
The Company has completed a review and risk assessment of all technology items
used in its operations. The Company believes that the year 2000 issue will
pose no significant operational problems. Substantially all of the machinery
and equipment used by the Company's glass manufacturing operation is manually
controlled and operated. In addition, the hotel operation is not
significantly reliant on computer technology, with the exception of its
reservation system, which is maintained and upgraded under a contract with
Holiday Inns Franchising, Inc. Holiday Inns Franchising, Inc. has recently
completed the upgrades necessary to make the reservation system Year 2000
compliant. The primary effect of the year 2000 issue is on the Company's
accounting systems.
Year 2000 compliance will primarily be accomplished through purchases of new
equipment and data processing hardware and software upgrades, with an
estimated aggregate cost of approximately $140,000, a significant portion of
which has already been purchased and most of which was previously planned and
necessitated by other technological needs of the Company. The upgrading or
replacement of equipment which is non-compliant, as well as the related
testing of such equipment is expected to be substantially completed during
fiscal 1999.
L.E. Smith currently has one customer of such significance that if such
customer were to experience year 2000 problems that resulted in the
cancellation or deferral of orders, it could materially adversely affect the
results of operations of the Company. The Company has discussed the year 2000
issue with this and other material customers and vendors and currently does
not anticipate any significant problems. In addition, the Company will
continue to review the status of the year 2000 issues with these and other
customers and vendors.
<PAGE>
NBI, INC.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
-------- -------------------------------------
(a) Exhibits
3. Certificate of Amendment to Certificate of Incorporation(2)
4. Form of Certificate of Designation of Series A Preferred
Stock(1)
10. Agreement between L.E. Smith Glass Company and The American
Flint Glassworkers' Union(2)
27. Financial Data Schedule(2)
(b) No reports on Form 8-K were filed during the quarter ended December
31, 1998 or subsequently.
(1) Incorporated by reference to Registration Statement No. 333-63053.
(2) Filed herewith.
<PAGE>
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.
NBI, INC.
February 12, 1999 By: /s/ Marjorie A. Cogan
--------------------- --------------------------------------
(Date) Marjorie A. Cogan
As a duly authorized officer
Chief Financial Officer, Secretary
Exhibit 3:
NBI,INC.
CERTIFICATE OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
We, the undersigned President and Secretary of NBI, INC., a
corporation organized and existing under and by virtue of the General
Corporation Law of the State of Delaware (the "Corporation"), do hereby
certify as follows:
FIRST. The Board of Directors of the Corporation duly adopted
resolutions containing the amendments to the Certificate of Incorporation of
the Corporation set forth below, declaring such amendments to be advisable and
calling for the consent of the stockholders of the Corporation to such
amendment.
SECOND. A majority of the outstanding stock entitled to vote
thereon, and a majority of the outstanding stock of each class entitled to
vote thereon as a class has been voted in favor of the amendments at the
Annual Meeting of Shareholders held on October 14, 1998. The amendments were
in all respects duly adopted in accordance with the provisions of Section 242
of the General Corporation Law of the State of Delaware.
THIRD. Article FOURTH of the Certificate of Incorporation of the
Corporation is hereby amended to read in its entirety as follows:
A. THE AGGREGATE NUMBER OF SHARES WHICH THE CORPORATION SHALL HAVE
AUTHORITY TO ISSUE IS TWENTY-FIVE MILLION (25,000,000) SHARES, CONSISTING OF
TWENTY MILLION (20,000,000) SHARES OF COMMON STOCK WITH A PAR VALUE OF $0.01
PER SHARE (THE "COMMON STOCK"), AND FIVE MILLION (5,000,000) SHARES OF
PREFERRED STOCK WITH A PAR VALUE OF $0.01 PER SHARE (THE "PREFERRED STOCK").
B. THE BOARD OF DIRECTORS IS AUTHORIZED, SUBJECT TO LIMITATIONS
PRESCRIBED BY LAW AND THE PROVISIONS OF THIS ARTICLE FOURTH, TO PROVIDE FOR
THE ISSUANCE OF THE SHARES OF PREFERRED STOCK IN SERIES, AND BY FILING A
CERTIFICATE PURSUANT TO THE APPLICABLE LAW OF THE STATE OF DELAWARE, TO
ESTABLISH FROM TIME TO TIME THE NUMBER OF SHARES TO BE INCLUDED IN EACH SUCH
SERIES, AND TO FIX THE DESIGNATION, POWERS, PREFERENCES AND RIGHTS OF THE
SHARES OF EACH SUCH SERIES AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS
THEREOF.
The authority of the Board with respect to each series shall
include, but not be limited to, determination of the following:
<PAGE>
1. THE NUMBER OF SHARES CONSTITUTING THAT SERIES AND THE
DISTINCTIVE DESIGNATION OF THAT SERIES;
2. THE DIVIDEND RATE ON THE SHARES OF THAT SERIES, WHETHER
DIVIDENDS SHALL BE CUMULATIVE, AND, IF SO, FROM WHICH DATE OR DATES, WHETHER
DIVIDENDS SHALL BE PAYABLE IN CASH OR IN KIND, AND THE RELATIVE RIGHTS OF
PRIORITY, IF ANY, OF PAYMENT OF DIVIDENDS ON SHARES OF THAT SERIES;
3. WHETHER THAT SERIES SHALL HAVE VOTING RIGHTS, IN ADDITION
TO THE VOTING RIGHTS PROVIDED BY LAW, AND, IF SO, THE TERMS OF SUCH VOTING
RIGHTS;
4. WHETHER THAT SERIES SHALL HAVE CONVERSION PRIVILEGES, AND,
IF SO, THE TERMS AND CONDITIONS OF SUCH CONVERSION, INCLUDING PROVISION FOR
ADJUSTMENT OF THE CONVERSION RATE IN SUCH EVENTS AS THE BOARD OF DIRECTORS
SHALL DETERMINE;
5. WHETHER OR NOT THE SHARES OF THAT SERIES SHALL BE
REDEEMABLE, AND, IF SO, THE TERMS AND CONDITIONS OF SUCH REDEMPTION,
INCLUDING THE DATE OR DATES UPON OR AFTER WHICH THEY SHALL BE REDEEMABLE, AND
THE AMOUNT PER SHARE PAYABLE IN CASE OF REDEMPTION, WHICH AMOUNT MAY VARY
UNDER DIFFERENT CONDITIONS AND AT DIFFERENT REDEMPTION DATES;
6. WHETHER THAT SERIES SHALL HAVE A SINKING FUND FOR THE
REDEMPTION OR PURCHASE OF SHARES OF THAT SERIES, AND, IF SO, THE TERMS AND
AMOUNT OF SUCH SINKING FUND;
7. THE RIGHTS OF THE SHARES OF THAT SERIES IN THE EVENT OF
VOLUNTARY OR INVOLUNTARY LIQUIDATION, DISSOLUTION OR WINDING UP, OR MERGER,
CONSOLIDATION, DISTRIBUTION OR SALE OF ASSETS OF THE CORPORATION, AND THE
RELATIVE RIGHTS OF PRIORITY, IF ANY, OF PAYMENT OF SHARES OF THAT SERIES; AND
8. ANY OTHER RELATIVE RIGHTS, PREFERENCES AND LIMITA-TIONS OF
THAT SERIES. SHARES OF PREFERRED STOCK MAY BE AUTHO-RIZED AND ISSUED, IN
AGGREGATE AMOUNTS NOT EXCEEDING THE TOTAL NUMBER OF SHARES OF PREFERRED STOCK
AUTHORIZED BY THE CERTIFICATE OF INCORPORATION, FROM TIME TO TIME AS THE BOARD
OF DIRECTORS OF THE CORPORATION SHALL DETERMINE AND FOR SUCH CONSIDERATION AS
SHALL BE FIXED BY THE BOARD OF DIRECTORS.
FOURTH. Article ELEVENTH of the Certificate of Incorporation of the
Corporation is hereby deleted in its entirety.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Amendment to be signed by Jay H. Lustig, its President, and Marjorie A. Cogan,
its Secretary, this 30th day of October, 1998.
NBI, INC.
By: /s/ Jay H. Lustig
------------------------
Jay H. Lustig, Chief Executive Officer
ATTEST:
/s/ Marjorie A. Cogan
- ------------------------
Marjorie A. Cogan, Secretary
Exhibit 10:
<PAGE>
AGREEMENT BETWEEN
THE L.E. SMITH GLASS COMPANY
MOUNT PLEASANT, PENNSYLVANIA
AND
THE AMERICAN FLINT GLASSWORKERS' UNION
LOCAL UNION # 102 AND # 537
EFFECTIVE
SEPTEMBER 7, 1998 TO AUGUST 31, 2001
PREAMBLE
- --------
This agreement, made and entered into by and between the L.E. Smith Glass
Company and the American Flint Glassworkers' Union, A.F.L. & C.I.O., on behalf
of Local Unions # 102 and # 537 (hereinafter referred to as the Union) shall
be known as the General Agreement between said parties. This Agreement and
such supplemental provisions that may be later agreed to between said parties
shall constitute the complete Agreement between the Company and the Union and
shall apply to those employees, members of the Union and employed by the
Company, as per Article I of the Agreement.
ARTICLE 1 RECOGNITION
-----------
The Company recognizes the Union as the sole and exclusive bargaining agency
for all hourly paid production and maintenance employees in the above
specified plant, except plant executives; office employees; technical staff
(including laboratory, engineering, and mechanical development); janitors who
clean the offices, rest rooms, cafeteria, showroom, and water fountains; plant
guards; salaried special and final inspectors; factory clerks (including
shipping and receiving clerks); foremen; and assistant foremen who have the
authority to recommend the hiring and discharging of production and
maintenance workers.
ARTICLE 2 INTENT AND PURPOSE
--------------------
Section 1 It is the intent and purpose of this Agreement to promote and
improve the relationship between the Company and the Union and to set forth
the basic rules regarding working conditions affecting employees covered by
this Agreement.
Section 2 In furtherance of this intention, the Company, through its
representatives, agrees to meet the Shop Committees representing The American
Flint Glassworkers' Union whenever necessity requires to discuss grievances
which may arise and the interpretation of terms of the contract. Such meetings
are to suit the reasonable convenience of both parties, but either party may
demand that such a meeting be held within five (5) days from the date of the
request in accordance with the Grievance Procedure. The Company or the Union
may require a written statement listing the subjects to be discussed.
Section 3 The right of the employer to choose any new employees is hereby
acknowledged. In the event of the employer being unable to secure competent
glassworkers, the management shall request the factory committee to supply
competent glassworkers as soon as possible.
ARTICLE 3 UNION SHOP
-----------
Section 1 The Labor-Management Relationship Act of 1947, having been
compiled with and the Company having received notice from the Union
Negotiating Committee which makes this Agreement, that a substantial majority
of the employees covered by this Agreement desire that union membership be
made a condition of employment, the following Union Shop clause is adopted:
It is a continuing condition of employment that all employees engaged in the
performance of work covered by this contract shall, on and after the sixtieth
(60th) day of employment or sixty (60) days after the effective date of this
contract or sixty (60) days after it is signed, whichever is later, become and
remain members of the Union in good standing during the life of the contract
subject to the provisions of Section 8 (a) (3) of the Labor Management
Relations Act of 1947 as amended.
The Union, when notifying the Company that an employee is not in good standing
in the Union, shall do so in writing and state the reason therefore. If the
reason is the failure to tender the regular initiation fees and/or membership
dues required by the Union, the employer, if requested by the Union, shall
discharge such employee within two (2) weeks unless he is reinstated in the
Union within that time or otherwise entitled to employment under the
provisions of existing State or Federal Laws.
The first sixty (60) days of employment will be probationary; however,
provisions of this contract will apply to new employees with regard to all
matters except that the discharge of a new employee unsatisfactory to the
Company during this sixty (60) day probationary period shall not be a matter
for grievance.
The sixty (60) day clause, referred to above, is not applicable to a call
back from a temporary layoff, if such person has previously worked for the
Company for a period of sixty (60) days or more. In case of a rehire, it will
be necessary for the employee to sign a new Union Dues Authorization Deduction
Card to authorize payroll deduction.
ARTICLE 4 CHECK-OFF OF UNION DUES
--------------------------
Section 1 The Company agrees to deduct regular Union membership dues from
the wages of those employees who are members of the Union and who so authorize
it by written assignment of their wages on a form provided by the Union and
acceptable to the Company.
Section 2 The assignments, once executed, shall be irrevocable for a
period of one year from the date of the execution or until the termination
date of this Agreement, whichever occurs first, but may continue in effect
thereafter unless revoked in accordance with the Labor-Management Relations
Act.
Section 3 The Union is responsible for forwarding the Union assessments
deduction authorization card to the Company office. No deductions for Union
assessments will be made by the Company until receipt of the assessments
deduction authorization card duly executed.
Section 4 It is mutually agreed between the Company, Local # 102, and
Local # 537 that the following rules will be followed when deducting Union
dues:
Dues will be credited to the appropriate Union, based on the job worked
Skilled or Industrial.
When one employee performs both Industrial jobs and Skilled jobs during the
same week, the entire dues will be credited to only one Union, based on the
most hours worked whether it be Skilled or Industrial.
ARTICLE 5 GRIEVANCE PROCEDURE
--------------------
The Union and the Company agree that if a dispute arises in the plant, it
shall be settled in the manner provided for in this article. Pending the
settlement of such matter, there shall be no change in working conditions;
that is, work shall be continued just as if no cause for a controversy had
arisen, and pending final settlement of the matter, there shall be no
lockouts, slow-downs, sit-downs, strike or cessation of work by either
employer, Union or employee.
If an employee has a grievance, he shall first confer with his Foreman for
adjustment of the matter.
If a satisfactory settlement is not made with the Foreman, the matter shall be
referred by the employee to the Shop Committee for investigation. If the Shop
Committee considers the grievance to be justified, it will confer with the
Foreman and Department Head.
Should no agreement be reached, the matter shall then be jointly presented to
the Department Head affected by the Shop Committee, the Personnel Director,
and the Foreman.
Should no agreement be reached, the matter shall be jointly presented to the
Plant Manager and/or his representative by the Union Committee, the Personnel
Director, and the Department Head affected.
Should no agreement be reached, the matter shall be referred by the Local
Union Officers to the International President, if circumstances warrant,
requesting that an International Officer be assigned to further process the
grievance with the Plant Manager and such Company representatives as he
desires to have participate.
Should no agreement be reached, the matter shall be referred to the National
President of the American Flint Glassworkers' Union and the proper executives
of the company for consideration.
If no agreement is reached through the above steps, the matter may be referred
to arbitration in the following manner:
If the Union and the Company do not agree on an arbitrator to settle the
grievance, he shall be chosen from a list of nine arbitrators proposed by the
American Arbitration Association. The Director of Labor Relations of the
company, or his designated representative, shall alternately strike one name
from the list of nine until only one name remains. The right to strike the
first name shall be determined by lot.
ARTICLE 6 UNION RESPONSIBILITIES
-----------------------
Section 1 Recognizing that the welfare of its members and the
opportunities to earn a living depend upon the success and prosperity of the
Company, the Union hereby pledges for itself and all its members (the
employees of the Company) that they will perform their work efficiently and to
the best of their ability to the end that the Company may adequately meet
competitive conditions and maintain maximum employment.
Section 2 The Union further pledges for itself and its members that they
will fully cooperate in the following: The reduction of shrinkages of all
kinds; the saving of materials, tools, machinery, equipment, and all the
Company property by means of careful handling and use, minimizing breakage and
losses of any kind caused by careless handling; maintaining a high standard of
quality in all products through efficient and careful workmanship; aiding in
the enforcement of all safety, good housekeeping and health measures; and
cooperating to the best interests of the Union and the Company.
Section 3 The Company will provide bulletin board space for exclusive
Union business, with the understanding that the Union shall post no notices
elsewhere on Company property.
Section 4 In case of sickness or inability to work, the employee shall
make every reasonable effort to notify his Foreman as far as possible prior to
the time to go to work.
ARTICLE 7 MANAGEMENT RESPONSIBILITIES
----------------------------
Section 1 The Company is responsible, as the Union recognizes, for the
management and operation of the plant, direction, order, and discipline of the
working forces; and it agrees that the Company may hire, promote, transfer,
layoff for lack of work, and suspend or discharge employees for proper causes
provided that no action so taken shall be in violation of any other provision
of this Agreement and that the Company shall not use this right for the
purpose of discrimination against any employee because of his or her
membership or legitimate activity in the Union.
Section 2 Nothing in the above paragraph shall be construed so as to
prevent the Management from discharging employees on sight and without notice
for intoxication, disorderly conduct, refusal to carry out proper orders,
carelessness, endangering life or property, or for the violation of Plant
Rules made a part hereof. However, should the Union disagree with any decision
rendered by the Company with regard to the above rules, it shall become a
matter of grievance and processed accordingly.
Section 3 The Management shall endeavor to establish work schedules and
starting and quitting times that are mutually satisfactory to both the Company
and the employees. The Shop Committee affected shall be notified in advance of
any changes in schedules involving other days of the week not previously
worked or changes in starting and quitting times.
Note: Nothing in this section shall be construed to supersede rules outlined
in Department Supplements.
ARTICLE 8 NO DISCRIMINATION
------------------
There shall be no discrimination on the part of either Company or Union on
account of age, race, color, sex, national origin, or religious belief of any
employees.
This contract will also be administered in accordance with applicable laws
preventing discrimination as to qualified handicapped individuals and as to
qualified disabled veterans of the Vietnam era.
ARTICLE 9 HOLIDAYS
--------
The following days shall be recognized as holidays:
New Year's 36 Hour Period
(7 p.m. December 31 to 7 a.m. January 2)
Memorial Day 24 Hour Period
(7 a.m. Memorial Day to 7 a.m. the following day)
July 4th 24 Hour Period
(7 a.m. July 4 to 7 a.m. July 5)
Labor Day 24 Hour Period
(7 a.m. Monday to 7 a.m. Tuesday)
Good Friday 24 Hour Period
(7 a.m. Friday to 7 a.m. Saturday)
Easter Monday 24 Hour Period
(7 a.m. Monday to 7 a.m. the following day)
Thanksgiving & Day After 48 Hour Period
(7 a.m. Thursday to 7 a.m. Saturday)
Day before Christmas 24 Hour Period
(7 a.m. December 24 to 7 a.m. December 25)
Christmas 24 Hour Period
(7 a.m. December 25 to 7 a.m. December 26)
When any of the previous named holidays occur on Sunday, the following Monday
shall be observed as the holiday, and the actual holiday (Sunday) will be
considered as a regular Sunday and will not be considered a holiday.
A paid holiday shall be paid at the rate the employee worked at the last
scheduled day before the holiday. If the employee worked at a different rate
after lunch than before, an average of the two rates shall be used.
PAID HOLIDAY QUALIFYING RULES
-----------------------------
All full-time employees who have been on the manufacturer's payroll
continuously for sixty (60) days shall be paid for one regular shift, not to
exceed eight hours, at their hourly rate of pay for each of the presently
recognized nine paid holidays when no work is performed. Effective September
7, 1998, the rate of Holiday Pay shall be increased in accordance with the
ratio of Excess Earnings to Gross Pay (All Monies Earned) with a minimum of a
10% increase.
Qualifying rules are as follows:
Must have worked during the 15 calendar days next preceding the holiday or
during the 15 calendar days next following the holiday, and
Must work or be available to work on his last regularly scheduled working day
before the holiday and on his first regularly scheduled working day after the
holiday.
The Company will consider sickness with a doctor's excuse as a non-scheduled
work day in regards to the qualification of the day before or the day after
--
the holiday.
It is recognized that both the Union and the Company realize that there must
be some guidelines controlling holiday pay and that an employee must work his
full scheduled day before and after the holiday. However, certain
circumstances may warrant an employee not working the full scheduled day
before and after the holiday and still be considered for holiday pay.
If an employee must leave work because of illness or an emergency during
either of these work days, he or she must report the exact reason to his
Foreman or other responsible management personnel. In case of illness, the
Company reserves the right to send the employee to the doctor at that time, or
in the case of night shift, at the earliest possible time to determine the
extent and nature of illness. If the doctor confirms illness, the employee
will be paid. If the employee does not make himself available or does not go
to the doctor upon request, he or she will not be paid.
Employees normally scheduled to work on a holiday, such as Furnacemen and
Tankmen, must work as scheduled in order to qualify for holiday pay.
If a Tankman is not scheduled to work on a holiday, the employee will qualify
for an eight hour add-on for the holiday provided that all other qualifying
rules are met.
When a holiday falls on Saturday, it shall be paid for whether the employee
would be scheduled to work or not, subject to the qualifying rules.
No payment will be made for holidays not worked to employees on sick leave,
leave of absence for any reason, furlough, or on layoff except as otherwise
provided herein.
The recognized nine (9) paid holidays are:
New Year's
Good Friday
Easter Monday
Memorial Day
Labor Day
Thanksgiving Day
Day After Thanksgiving
Day before Christmas
Christmas
In cases where it is necessary and when work is performed on any of the above
holidays, time and one-half plus holiday pay shall be paid.
ARTICLE 10 SHIFT DIFFERENTIAL
-------------------
The Second Shift shall be paid a differential of 15 cents per hour. The Third
Shift shall be paid a differential of 20 cents per hour which is applicable to
producing labor (shops). The above amounts are not reflected in computation of
other premium time, vacation (unless worked), or other similar payments except
as required by law.
ARTICLE 11 PAY DAY
--------
Section 1 Workers shall receive a check covering their earnings in full
(less authorized deductions) every week and shall be paid within one week
after the close of the payroll period.
Section 2 When the Pay Day falls on a Holiday, the Company shall
distribute the checks on the preceding day, if possible.
ARTICLE 12 MERIT WAGE ADJUSTMENTS
------------------------
Nothing in this contract shall be construed to prevent the Company from giving
increased compensation to employees of particular merit or to those deserving
an increase or promotion or who are promoted during the period that this
contract covers.
ARTICLE 13 INVALIDITY
----------
In the event any of the terms or provisions of this Agreement shall be or
become invalid or unenforceable by reason of any Federal or State Law,
directive order, rule or regulation now existing or hereinafter enacted or
issued, or any decision of court of last resort, such invalidity or
unenforceability shall not affect or impair any other terms or provisions
hereof.
ARTICLE 14 FULL POWER
-----------
The American Flint Glassworkers' Union A.F.L.-C.I.O., represents to the
Company that the officers and/or representatives who sign this Agreement in
its name have full power and authority to make this Agreement on behalf of the
Union and the employees of the Company (members of Local Union # 102 and #
537).
ARTICLE 15 WAGES
-----
All existing hourly rates in effect will be increased as shown below:
Sept. 7, 1998 Sept. 6, 1999 Sept. 4, 2000
--------------- --------------- ------------
All Hourly Rates 50 cents /hr. 40 cents /hr. 40 cents /hr.
Skill Adjustment 50 cents /hr. 50 cents /hr. 50 cents/hr.
(Pressers, Gatherers, Finishers)
Skill Adjustment 25 cents /hr.
(Maintenance Dept.)
Such rates are to be reflected in piece work and incentive.
New Hires Non-Skilled
- ---------------------------
All non-skilled employees hired on or after September 7, 1998, shall be paid
as follows:
First 6 months -- $1.00/hr. less than normal rate
After 6 months -- $ .50/hr. less than normal rate
After 1 year Full rate.
All other employees currently on payroll receive full rate.
Any former employees who are rehired and have a minimum of TWO (2) years
previous service shall be paid the full job rate immediately upon rehire. Any
former employees who are rehired and have less than TWO (2) years previous
service shall be given credit for such previous service toward the full job
rate and will be paid the full job rate when the length of such previous
service plus subsequent service equals TWO (2) years.
Severance Pay
--------------
The Company proposes severance pay in the event the plant closes down on a
total and permanent basis as defined under the federal plant closing
regulation. Severance pay would be payable on the following schedule:
0-4 years 0
5-15 years 4 weeks
16-25 years 8 weeks
over 25 years 12 weeks
To qualify for severance pay, employees must work 400 hours within the
previous TWELVE (12) months.
ARTICLE 16 VACATION WITH PAY
-------------------
Section 1 Eligibility. All hourly paid employees who, during the life of
------------
the contract, worked 400 hours or more per year between January 1 and December
31 are eligible for a vacation with pay in line with the following provisions
and schedule:
Vacation Pay Members of Local # 102 and # 537.
---------------------------------------------------------------
Years Service Days Vacation
1 year or more 5 days (40 hours)
5 years or more 10 days (80 hours)
10 years or more 15 days (120 hours)
20 years or more 20 days (160 hours)
Effective with vacations earned in 1998 and paid in 1999, the rate of Vacation
Pay shall be increased in accordance with the ratio of Excess Earnings to
Gross Pay (All Monies Earned) with a minimum of a 10% increase.
Local # 102 Only
---------------------
The base rate for vacation pay will be determined by the base rate worked more
than 50% of the time during the month of October the previous year. The base
rates referred to above are the rates in force at the time the vacation is
taken, the October reference intended only to set the type of rates. Under no
circumstances will the rate be less than Medium Shop. The normal Power Press
Operator and Gatherer will receive Shades over 12 inches Dia. base rate for
vacation pay.
General Provisions Partial Vacations
-------------------------------------------
Any employee who has been continuously employed by the company for a period of
time as specified by the qualifying rules and who has worked more than four
hundred (400) hours but less than one thousand (1000) hours during the
qualifying year shall receive Vacation With Pay on the basis of the true
percentage of the hours worked as compared to 1000 hours. Any employee who has
worked 1000 hours or more shall receive one full week's pay for each week
entitled.
Section 2 Quit or Discharged. Where a person's service with the Company is
-------------------
severed by a quit or discharge and on furlough or leave of absence, he
automatically begins a new service record insofar as the vacation plan is
concerned, provided he is later rehired or returns to his job.
Section 3 Illness. Time lost by employees due to accidents in the plant
--------
with such accident being recognized by the State Workman's Insurance Fund will
count as time worked not to exceed a twelve-month period.
Section 4 Vacation Schedules. The plant will be closed down the first
-------------------
week in July or Fourth of July Week and all employees will take their first
week's vacation, and the second (2nd) week may be taken between the last
Saturday in June until the last Saturday in September with the understanding
that not more than one-fourth (1/4) of the employees shall be off at one time
or arrangements can be made by your Supervisor after considering the wishes of
each employee and the best operation of the plant. However, if or when it
occurs during the time the plant is shutdown for repairs or inventory, all
employees who are eligible for two weeks vacation with pay must take their
second week's vacation at that time.
Section 5 Vacation Pay. The first and second weeks of vacation pay, when
-------------
earned and due, will be paid to the employees on the Friday preceding
vacation.
Vacation pay is subject to withholding tax and social security tax or any
other tax in effect at the time of payment.
Section 6 Any employee who has been called in the Armed Forces and who has
worked the required number of hours during the period covered by this contract
will be eligible for vacation pay in accordance with the foregoing eligibility
rules.
Section 7 American Flint Glassworkers' Union National Executive and
Elected Delegates to the Annual or Biannual American Flint Glassworkers' Union
National Convention shall be given credit as time worked for vacation
purposes, the time lost from work due to attendance at said Convention and
Annual General Wage Conferences.
Section 8 Paid Vacation Hours. Non-worked hours paid for under Company
--------------------
policy at base rate for holiday, vacation, funeral leave, and jury duty will
be credited as hours worked for calculating vacation earned.
Section 9 For the third and fourth week of vacation, Management has the
right to limit the number of employees off in any one week to what, in
Management's opinion, maintains proper continuity of operations. The fourth
week vacation may be taken one day at a time with two weeks notice, except
during periods between July 15 and November 15. In cases where more employees
want off than is proper to maintain continuity of operations, Management will
consult with the individuals involved and attempt to provide vacations at
another time acceptable to the individual. If this is not possible, the
vacation will be assigned according to seniority.
If an employee is sick, the third and fourth week of vacation can be
taken a day at a time in lieu of lost time. Payroll must be notified of any
such request by the Monday following the week of absence for timely payment.
It is further understood and agreed that any employee who wishes to work
any portion of his vacation may do so if the Company requests it and agrees to
pay him his regular vacation pay in addition to pay for the time worked.
Section 10 Employees with one or more years of service who work the hours
necessary to qualify for a vacation period will receive vacation pay. In case
of death, payment will be made to the insurance beneficiary last designated
under the Company's group insurance plan or, in the absence of such
designation, to the proper heir as determined by the Company's legal counsel.
Any employee who quits after qualifying under the provision of the vacation
plan shall be paid vacation pay earned.
ARTICLE 17 REST PERIODS
-------------
Rest periods shall be as follows in the Hot Metal Department, applied to
operating personnel only:
The Company will provide relief for a thirty (30) minute unpaid lunch period
between the hours of 10:30 a.m. and 1:30 p.m. on the first shift and 7:00 p.m.
and 10:00 p.m. on the second shift. Also during the scheduled lunch periods,
the Company will provide required relief so that employees will not work more
than one hour without a ten-minute relief. During all other scheduled hours,
the Company will provide twelve minutes of relief during each hour.
During the period beginning May 15 and ending September 15, the Company will
provide 15 minutes of relief during each hour. If this additional relief time
is cause for losing any shops, the Hot End Committee shall be consulted for
any possible solution. If none is available, breaks shall revert back to 12
minutes.
ARTICLE 18 HOSPITALIZATION AND LIFE INSURANCE
-------------------------------------
The Company shall establish and maintain a comprehensive Group
Hospitalization, Life Insurance, and Weekly Accident Sickness Health Program
for all covered employees.
The Company shall be responsible for the administration of the Program.
Hospitalization
- ---------------
Coverage will remain the same as present.
Employee is responsible for 15% of the payment.
Company is responsible for 85% of the payment.
Company agrees to absorb price increase for the first year of contract. The
first year's increased rate would be effective during the second year of
contract. The rates for the third year of the contract are projected and
agreed to although they may not necessarily meet the 85% - 15% criteria as
specified above.
Employee payments are in accordance with the following schedule:
Effective Effective Effective
9-1-98 9-1-99 9-1-00
Family $52.10 54.39 60.00
Husband & Wife $49.77 52.01 57.00
Parent Child $45.50* 47.70 52.20
Single $21.37 22.34 24.60
* Employees presently in the special rate category shall continue to pay that
rate for the first year of contract only.
Dental Coverage
- ----------------
Individual Employee Two Person Employee Family Employee
Coverage Pays 15% Coverage Pays Coverage Pays
Upgraded Plan:
$18.05 2.71 36.10 20.76 53.32 37.98
Eyecare Coverage
- -----------------
Individual Employee Two Person Employee Family Employee
Coverage Pays 15% Coverage Pays Coverage Pays
$2.82 .42 5.64 3.24 7.90 5.50
Life Insurance
- ---------------
Life Insurance Accident & Sickness Employee Cost
$30,000 13 weeks @ $180.00/wk. $4.16/mo.
New Hires Effective September 7, 1998
----------
Newly hired employees shall be offered full benefits after attaining sixty
(60) days of company service.
ARTICLE 19 FUNERAL LEAVE
--------------
In case of the death of a spouse, child, or step-child, an eligible employee
shall be paid for regular scheduled time lost through the third day after
interment, not in excess of five (5) eight-hour shifts at his or her regular
base wage rate.
In order for an eligible employee to attend the funeral of a parent,
step-parent, brother, or sister, the employee shall be paid for regular
scheduled time lost through the day after interment, not in excess of three
(3) eight-hour shifts at his or her regular base wage rate.
If an employee's grandparent, grandchild, mother-in-law, or father-in-law
should die, the employee may be absent on the day of the funeral to attend the
funeral and shall be paid for regular scheduled time lost not in excess of
eight (8) hours at his regular base wage rate.
In order for an employee to be eligible, he or she must be a full-time
employee who has been on the manufacturer's payroll continuously for sixty
(60) days.
ARTICLE 20 RETIREMENT
----------
Employees shall be subject to mandatory retirement according to current
federal law.
Employees will become eligible to participate in a 401-K Retirement Savings
Plan on the first day of the month following completion of sixty (60) days'
service and attainment of age 18.
There will be no cap on hours worked toward 401-K.
Company will contribute to each participant in the 401-K Retirement Savings
Plan on the following basis:
Effective September 7, 1998:
Less than 10 years service - twenty (20) cents per actual hours worked.
Service of 10 years and over - thirty (30) cents per actual hours worked.
ARTICLE 21 JURY DUTY
----------
Employees shall be paid the difference between eight (8) times their regular
hourly base wage rate and the payment they receive for Jury Duty for a maximum
of ten (10) working days each calendar year, subject to the following
requirements:
Payment will be made only for Service on a Petit Jury in Federal, State, or
County Court and the employee must notify the Company within forty-eight (48)
hours after receipt of summons.
The employee must present to the Company proof of Jury Duty and the amount of
pay received thereof.
This provision shall not apply where an employee voluntarily seeks Jury
service, and the Company reserves the right to request that an employee be
excused from Jury Duty.
Employees who are excused from Jury Duty before 12:00 noon shall be required
to report for work for the full shift should they be employed on the Second or
Third Shifts.
Hours on Jury Duty will not be counted in computing overtime.
ARTICLE 22 LOST TIME
----------
It is mutually agreed between the Company and the Union that any lost time of
fifteen (15) minutes or more at the start of a turn or duration of the turn,
for any of the reasons shown below, will be compensated for at the hourly rate
of each job, providing that the four (4) hour skilled move is packed:
Applicable reasons for lost time of 15 minutes or more are as follows:
Delay in setting in press. A press is considered ready when set in, leveled,
and the air hooked up.
Glass not ready to work in day tanks due to excessive melting time. Delay time
will end when molds are taken out of mold oven.
Defective mold equipment that requires repair prior to starting the turn or
during the duration of the turn. Delay will end when mold equipment is
delivered back to the press.
Glory holes, glaziers, and sputniks not set in at start of turn or the
duration of the turn. Delay ends when such equipment is set in place and shop
can begin making ware.
If cold molds are used due to a schedule change at the start of a turn or the
duration of the turn, delay time will be allowed to heat up molds. This
applies only to molds that come directly from storage instead of the mold
oven.
Job changes at any time during the turn.
The Foreman on each shift will be responsible for determining the amount of
lost time in accordance with this agreement.
ARTICLE 23 LOST TIME DUE TO ON-THE-JOB ACCIDENTS
------------------------------------------
When an employee is involved in an accident on the job and requires medical
aid from a doctor, the Company will pay at the hourly rate worked from any
lost time on the day of the accident. Such lost time must be authorized by the
examining doctor.
ARTICLE 24 HOSPITALIZATION RATES FOR EMPLOYEES AWAY FROM WORK
--------------------------------------------------------
It is mutually agreed between the Company and the Locals # 102 and # 537 that
employees can be charged the full rate for hospitalization after six (6)
months of continuous layoff. If an employee is unable to pay the required
premium, the coverage will be terminated. If coverage is terminated, it can be
reinstated only when the employee is called back to work.
If an employee is called back to work from layoff status and does not return,
all benefits will be terminated.
After 30 months away from work, employees on worker's compensation or off due
to sickness can be charged the full rate for hospitalization insurance. If the
employee is unable to pay the required premium, the coverage will be
terminated.
ARTICLE 25 SECONDS AND STONES
--------------------
All seconds selected over the move and kept to be sold in the Company Store or
other outlets shall be paid for at 50% of that paid for first quality ware.
In cases where the move is not met with first quality ware, any seconds will
be counted the same as first quality ware up to the move for pay purposes.
ARTICLE 26 GATHERERS
---------
It is mutually agreed between the Company and the Locals # 102 and # 537 that
non-card Gatherers will be assigned to shops based on overall past performance
of ability and dependability as determined by the Foreman.
SECTION 27 GENERAL
-------
Any employee in this department caught throwing any article or in any way
molesting another employee or willfully destroying Company property will be
subject to discharge.
Employees are expected to be familiar with the Rules and Regulations as
provided in this contract and any supplemental agreement mutually agreed upon.
This contract provides the procedure by which complaints or grievances of
employers or employees are to be handled. We will recognize and follow it, and
we expect all members of the American Flint Glassworkers' Union to do the
same.
Any employee caught stealing or destroying Company property is subject to
immediate dismissal.
The Company reserves the right to handle, in the following manner, employees
who break department rules: fail to follow instructions or in any way fail to
live up to any written agreement. For the first offense, employee shall be
given a warning slip. For the second offense, employee shall be given a second
slip and may be laid off a maximum of five (5) operating days. The third
offense may mean dismissal of employee. These slips shall be made out in
triplicate, one copy to be given the employee, one to the Union, and one
retained by the Company. These slips shall contain the infraction of rules,
instructions, or contract involved and shall be signed by the employee's
immediate Foreman and at least one of the Company officials. If there is any
discussion concerning a slip, it must be made within 24 hours of the time the
employee and Union are handed the slips. When a slip is issued and the
employee has a clean record for a period of one (1) year, Management will
withdraw the slip.
No Agreement shall be changed or new Agreement made without mutual consent of
the Union and the Company.
ARTICLE 28 NO MALE/FEMALE WAGE DIFFERENTIAL
-----------------------------------
Whenever there is a reference to the masculine or feminine gender in this
Agreement, such reference is used solely for the convenience of the draftsman
and, in all cases, use of the masculine or feminine gender is intended to
refer to employees of either sex. There will be no difference in rates of pay
for males and females who do equal work on jobs, the performance of which
requires equal skill, effort, and responsibility and which are performed under
similar working conditions.
ARTICLE 29 LEAVES OF ABSENCE
-------------------
Upon written application, Leaves of Absence for good cause may be granted
employees. Such leave shall be in writing and approved by the Plant Manager. A
copy will be given to the Union. Employees who do not return at the expiration
date or who engage in other employment while on leave shall be deemed to have
quit.
Maternity Disability
---------------------
Maternity disability leave shall be treated the same as all other
non-occupational medical disability leaves. Hospital and medical benefits will
be paid the same as for any other disability.
Weekly sickness and accident benefits will only be paid to employees who
commence their maternity disability leaves when disabled , as established by
medical documentation approved by the Company or insurer, and it will only be
paid for the actual disability period which, absent medical documentation
approved by the Company or insurer, will be presumed to cease no more than six
weeks following delivery or other termination of the pregnancy.
Employees who commence their maternity disability leaves when disabled and who
return to work within six (6) weeks after delivery or other termination of the
pregnancy (or whose disability period after delivery or other pregnancy
termination is extended on the basis of Company approved medical
documentation) will be guaranteed reinstatement to their former job
classification or those of like pay and status, provided they would otherwise
be entitled to work.
Any employee who:
commences her maternity leave before she is disabled, or
fails to return to work within six (6) weeks after delivery (or whose
disability period after delivery is not extended on the basis of Company
approved medical documentation), or
fails to return to work within a reasonable recovery period after a
miscarriage or other termination of pregnancy
will be considered a voluntary quit with no entitlement to reinstatement to
her former job classification or one of like pay and status.
Any dispute that may develop over this policy is subject to the Grievance
Procedure.
ARTICLE 30 PREMIUM TIME
-------------
Section 1 The Company agrees to pay time and one-half for the following:
All hours of work in excess of eight (8) hours during any one workday.
All hours of work during the designated 24-hour Sunday period.
All hours of work in excess of 40 hours in any week.
Tank Tenders' holiday add-on pay for holiday hours not worked shall not be
counted as time worked in figuring premium time under paragraph C above.
Section 2 There shall be no duplication of pyramiding of premium time or
overtime. Exception: Holiday hours Monday through Friday paid for but not
worked shall be counted as time worked in figuring premium time under
paragraph C above.
Saturday holiday hours will not be counted as time worked in figuring weekly
overtime.
Section 3 The working of overtime shall be mutually acceptable to the
individual employee and the Company. That is: The Company cannot require an
employee to work overtime nor can an employee demand the Company to give him
overtime.
Section 4 A 10 cents per hour Premium will be paid for all hours worked on
Sunday. This is to be a straight 10 cents per hour add-on and will not be
computed in calculation of overtime payments or bonus earnings.
Section 5 An employee who is called to work after leaving the factory will
be given an opportunity to earn at least four (4) hours' pay at his regular
base rate. If the employee chooses to return home after completing the task
for which he was called, he shall be paid for the time worked, with a minimum
of two (2) hours' pay at his regular base rate. It is understood that if a
greater amount of earnings would result from application of any of the
overtime provisions of the contract to the time worked, the employee will be
paid the greater amount. Such minimum guarantees do not apply in case of work
immediately prior to the employee's scheduled shift.
Section 6 When weather conditions indicate the need for heat within the
plant, the Company will make every possible effort to adjust the temperature,
making it possible for all employees to work in comfort.
ARTICLE 31 GENERAL RULES LOCAL #537 AND LOCAL #102
-------------------------------------------------
Section 1 Working hours in the Cold Metal Department are from 7:00 a.m. to
3:30 p.m. on the First Shift and from 3:30 p.m. to 12:00 midnight on the
Second Shift. Hours in the Hot Metal Department are from 7:00 a.m. to 3:30
p.m. on the First Shift and 3:30 p.m. to 12:00 midnight on the Second Shift.
Section 2 All employees on the time clock must punch their own card, it
being a violation of the Federal Wage and Hour Law for one employee to punch
another employee's time card.
Section 3 Employees from one department are not allowed in another
department unless in the performance of their duties or with permission from
their Foreman.
Section 4 Tank Tenders. Tank Tenders will work a three (3) shift, twenty
-------------
(20) week rotating schedule. Tank Tenders' work schedule will begin on Sunday
(11:00 p.m. Saturday night) instead of Monday.
This change will result in Saturday work at time and one-half if it is the
sixth day of the week and all other qualifying rules for overtime are met. The
schedule repeats itself every twenty (20) weeks, and each employee will have
had a sixth work day fall on Saturday five times during this period.
Tank Tenders are to understand that they have responsibility for all phases of
the operation of all melting units as assigned by the Foreman and the
practices which are consistent with proper melting and tank operations.
Section 5 Turning Out. All turning out jobs will be advertised, and each
-----------
shop assigned a permanent Turning Out employee who cannot be bumped unless
there is a temporary or permanent reduction in forces in Local # 537. A
temporary reduction in forces is any layoff lasting more than one (1) week.
Job rights for turning out will be governed as follows:
If either a permanent or temporary cutback occurs, a permanent Turning Out
employee can be bumped by another employee holding more seniority only if
there is no other work available. If bumping does occur, the youngest Turning
Out employee will be the first one bumped.
If a Presser retires and is replaced by a new Presser, the Turning Out
employee of the old shop will be considered as the permanent Turning Out
worker of the new shop.
If a Presser retires and is replaced by a Presser from another shift or shop,
seniority will rule in determining whether the retired Pressers Turning out
employee or the replacement Pressers previous Turning Out employee will be
considered as the permanent Turning Out employee of the new shop.
Turn Out employee on low shop shall receive the same base rate as the Glazer
and warming-in base rate on the low shop.
Section 6 Mould Cleaners
---------------
The mould cleaning room shall be manned as shown below unless the employee has
to be pulled to keep a shop working.
When running five (5) or more shops, two (2) persons will be assigned to the
mould cleaning operation.
When running four (4) or more shops (with a power press in operation), two (2)
persons will be assigned to the mold operation.
When running four (4) shops or less (no power press), the Company will
evaluate the work load and determine the crew size accordingly.
When working two (2) shifts, there shall be a Head Mould Cleaner and an
Assistant on each shift.
Section 7 Warming In Workers
--------------------
Warming In Workers will assist the Finisher on punch sets by drilling the
snaps when making plates. Whenever Management considers it necessary, the
Warming In Workers will also roll the snaps when making punch bowls.
Section 8 Labor Gang
-----------
Laborers will be set up on a permanent basis and cannot be bumped. In overtime
work, the laborers will have priority and if additional help is needed,
seniority in the Hot End will prevail.
Section 9 Base Rates of Pay
--------------------
Base rates for jobs not covered by the current base rate wage list shall be
set up by the Company after making a comparison with other jobs in the plant
and by giving proper weight to skill, effort, responsibility, and job
conditions. In any instance where the Union feels the rate to be in error, the
matter shall be subject to the Grievance Procedure, and if subsequently it is
found that a correction should be made in a new base rate, such adjustment
shall be retroactive to the date of the written protest but in no event before
the effective date of the contract.
Where inequalities or inequities in base rates exist or arise, adjustments may
be made by the Union and the Company.
Section 10 Seniority Local #537
--------------------------
For the purpose of determining layoffs and other factors surrounding
seniority, there shall be two recognized departments: namely, Hot Metal and
Cold Metal. The Hot Metal Department embraces those operations in the
production of ware in what is commonly known as the Hot End. The Cold Metal
Department embraces all operations other than those done in the Hot End.
When work becomes slack, the available work shall be delegated to the employee
having most seniority with the Company within their respective departments
providing they are physically fit and competent through knowledge, training,
skill, and efficiency to perform the available work.
New workers shall not be hired in any department while regular (Union) workers
of that department are laid off.
The seniority of an employee shall start when he or she starts to work in the
department to which he or she is assigned.
An employee's service and seniority shall be cancelled after a layoff of two
(2) years.
Restoration of Service A former employee who has two (2) or more years of
- ------------------------
continuous service with the Company and who has been or is re-employed by the
Company shall be given credit toward vacation for prior service with the
Company after he has been re-employed for a period of three (3) years.
Cold End Seniority Protection Agreement
- -------------------------------------------
Any person who has been on layoff continuously for a period of six (6) months
shall have bumping right on any job posted under the Seniority Protection
Agreement.
The jobs of Sawing (First and Second Shifts) and Grinding (First and Second
Shifts) are covered by this Agreement. All jobs posted in the future will be
looked at by the Company and the Union and if applicable will be subject to
this Agreement.
Anyone laid off shall have the right to bump onto lehr work with his full
seniority but must stay on lehr work until work becomes available on his
signed job. Such bumping will be limited to full days and will not apply to
partial days.
If any questions arise concerning the qualifications of those bumping, the
Cold End Committee will be consulted to help solve the problem.
Members of the Union shall be given the preference of work over non-union
employees in conformity with conference agreements and understandings.
If an employee is asked by the Management to transfer from one department to
another and the transfer is made, he or she shall retain his seniority rights
in his former department for ninety (90) days.
In the event a shop is off, the senior employee in that department employed on
said shop shall be entitled to work before employees who are new or have less
seniority.
All open jobs are to be listed for seven (7) days on the bulletin board for
publication so that all members will know of the opening and that the Foreman
and Committee shall give full consideration as to who shall be placed on the
job, said jobs having been left open for one week after publication for
discussion and consideration. After a trial period of one week, it shall be
agreed between Management and Committee as to whether the employee shall
remain on the job or return to his old job. Any person who passes up the
opportunity to take this job thereby forfeits any later claim to this
position.
In the restoration of forces if any employee fails to report to work within
seven (7) days after proper notification, he or she shall lose all seniority
rights.
The Company will post a list every six (6) months, showing the seniority of
all employees in both the Hot Metal and Cold Metal departments. The Union
Secretary shall provide a list of Union Officials and Committee Members.
In case an employee is drafted or enlists because he is eligible to be drafted
into Military Service in time of war or peace, he will retain his seniority,
providing he returns to work within ninety (90) days after he receives his
discharge.
The Company's records shall be final.
Section 11 Improved Methods. This department pledges for itself and all
-----------------
its members that it will cooperate in the introduction of advanced methods of
machine production so that the Company may adequately meet competitive
conditions and maintain employment.
Questions relating to Cold End Department operations, incentives, and
productivity will be referred to the Cold End Labor-Management Productivity
Committee comprised of no more than three Local # 537 employees, and if not
resolved, shall be a matter of the Grievance Procedure.
Section 12 Temporary Transfer
-------------------
Employees temporarily transferred to any other job paying a lower rate shall
be paid their regular rate if work is available for them on their regular job.
Employees transferred to a job paying a higher rate shall be paid the job rate
of the work performed.
Such temporary transfer or assignment of an employee to a lower rated job, at
the base rate of the high job, shall not constitute a change in rate for the
lower rated job.
Section 13 Reporting For Work Pay
-------------------------
Any worker holding a regular position, reporting for work at his usual time,
will be guaranteed at least four (4) hours' pay for four (4) hours' work at
this regular rate, unless he has been instructed not to report. This policy
will not apply during floods, fires, tornadoes, power or fuel failures,
machine breakdowns, or other emergencies beyond Company control. Any service
call shall be for not less than four (4) hours' pay.
The Company assumes no responsibility for individuals appearing in the hope or
expectation that work may be available.
Section 14 Gloves
------
All employees handling hot, sharp, or any tool or article that may be
injurious to the hands shall be furnished with gloves.
New gloves are to be issued upon return of the old and worn-out gloves.
Section 15 First Aid. Although every possible effort has been made to aid
----------
in accident cases, we feel that adequate space should be made where
cleanliness could be maintained and in case of serious accidents, employees
injured could be placed or moved where first aid could be rendered with
readiness and cleanliness.
Section 16 Sample Room. The job of the employee who packs samples,
-------------
less-than-carton lots and odds-and-ends orders will be advertised according to
our present written Agreement for advertising jobs which become open. When an
employee has been assigned the job according to the above Agreement, no
employee can bump that worker so long as the assigned employee wants the job.
It is understood that if there is not enough work available for a complete
day, this employee can complete the day by assignment to any work available.
If the worker is caught up with available sample room work, this employee will
not be called out until at least part of a day is available or is eligible for
work according to general seniority.
Section 17 Etching Room. The Company will provide x-rays to all
--------------
permanently assigned and regularly scheduled etching room employees according
to applicable law.
Section 18 Miscellaneous Workers Skilled Cards. Miscellaneous workers who
------------------------------------
get skilled cards will be given protection on their miscellaneous seniority
for a period of four (4) years from the date of their skilled card. If a
cutback in operations should be necessary during the four (4) year period, the
worker will be permitted to do miscellaneous work according to his seniority.
It is not the intent of this Agreement to permit employees with skilled cards
to get overtime on miscellaneous work.
Section 19 Tank Tender Trainee. When a Tank Tender is needed to be trained
--------------------
as a future Tank Tender replacement and for emergency use, the job will be
advertised and awarded based on workmanship and seniority.
The individual selected can sign for other job openings, but when a Tank
Tender is needed in an emergency or on a full-time basis, this employee is
obligated to perform the tank tending job. If the selected employee is needed
on a full-time basis, this individual will become a permanent Tank Tender and
relinquish all rights to other jobs held for a period of four (4) years.
A Tank Tender cannot be bumped.
Section 20 Industrial Workers - Shop Knockoffs. If a shop works three (3)
------------------------------------
hours or more on First or Second Shift and is knocked off by the Foreman due
to no fault of the shop, the industrial workers will receive four (4) hours'
pay.
The usual shift differential on all shifts will continue to be paid on a
proportionate basis as in the past based on the number of hours worked.
Section 21 Cold End Incentive. All incentive jobs in the Cold End will be
-------------------
paid for by the job and not averaged by the day or half day if proper and
accurate times can be recorded for each job. When accurate times cannot or are
not recorded, incentives will continue to be based on the average for the full
day or half day as is presently done.
This is subject to mutually resolving the proper and accurate recording of
times on each job by the lehr tenders and associated relief people.
Section 22 Spray Decorating in Hot End. It is mutually agreed between the
----------------------------
Company and Local # 537 that the job of Spray Decorating in the Hot End be
handled as follows:
The job will be posted for Hot End employees only.
Rate is as per rate sheet.
Sprayer must work with the shops. If less than four (4) hours' spraying is
scheduled, the Sprayer must work where assigned by the Foreman for the balance
of the turn but will be paid the Sprayer's hourly rate. It is not the intent
of this Agreement to guarantee work if a shop knocks off.
Sprayer must spray when required by Supervision. When spraying is not
required, the Sprayer can bump any non-posted job based on seniority and
ability to do the job at the start of a turn.
The individual selected for the Sprayer position will relinquish rights to any
previously owned job after a 30-calendar-day trial period.
Section 23 Incentive Program. Incentive programs will be as per the
-------------------
various separate incentive agreements and Article 32, Section 11 of this
Contract.
Section 24 Hot End Relief. Hot End Relief shall receive 100% Participation
---------------
for incentive if breaks are given accordingly.
Section 25 Semi-Automatic Jobs
--------------------
Carried over to Big Glazier
Carry In and Carry Over - 100% Participation
Carry In Party Plates - 100 % Participation
Section 26 Straightener, Catch Out, Ring Lifter
----------------------------------------
The above jobs shall pay the same rate as Turn Out.
Section 27 UPS
---
The UPS job shall pay the same wages as Shipping.
ARTICLE 32 SUPPLEMENTARY AGREEMENT LOCAL # 102
---------------------------------------------
EXCLUDING MOULD MAKERS
------------------------
The following Agreement apples to those Union employees in the Pressed and
Blown Department of Local Union # 102 working at the L.E. Smith Glass Company
located at Mount Pleasant, Pennsylvania, and is a part of and supplementary to
the General Agreement entered into by and between the Company and the Union.
POWER PRESS GATHERERS
- -----------------------
All articles weighing six (6) pounds or over, up to seven and one-half (7 1/2)
pounds shall pay Pressers' rate and all articles measuring fifteen (15) inches
or over in diameter up to seven and one-half (7 1/2) pounds shall pay Pressers'
rate of pay.
If an item weighs 11 3/4 pounds or more, the Company agrees to pay Pressers'
wages to the first Gatherer and to use this weight limit as a guideline in
determining Gatherers' wages on future items where weight is the determining
factor. In no case where weight is the determining factor will the first
Gatherer receive Pressers' wages if the item weighs less than 11 3/4 pounds.
Two (2) Gatherers are required for jobs weighing seven (7) pounds or more.
It is mutually agreed between the Company and Local # 102 that the regular
Second Gatherer on the power press (crystal) must be capable of moving up to
First Gatherer when the regular First Gatherer is not available for work.
If single gathering jobs are scheduled on the power press and the regular
Gatherer is not available for work, the regular Second Gatherer will
automatically move in to fill that vacancy. Any refusal by the Second Gatherer
to temporarily move to First Gatherer will mean that the person involved has
given up his rights to be Second Gatherer.
GLOVES
- ------
The Company shall furnish the Pressers with one (1) pair of gloves every week,
and the Gatherers, Finishers, and Handlers one (1) pair every two (2) weeks.
The old gloves must be returned.
ROTARY PRESS
- -------------
All articles eight (8) inches and larger made on the rotary press will be made
at regular side lever press moves.
Repair Press. The Company agrees to repair all presses and put them into
- --------------
A-1 condition or in good working order so as to make a better production unit.
Also, the Company agrees to repair or replace wind pipes and air lines as
required.
Fans Cleaned. The Company agrees to keep the fans clean.
- --------------
Rest Rooms. The Company agrees to keep the rest rooms clean.
- ------------
Unity Head Maker. The Company agrees to have someone in at all times to make
- ------------------
punty heads, keep clay in order, and do whatever is necessary to make better
production.
Layoff Over One Month Local #102.If a layoff occurs, the Company shall
- ------------------------------------
meet with the Local and discuss the seniority plus qualification of those
individuals involved.
The Company agrees to stamp all cartons "Buy Union, American, Handmade
Glassware."
The Company agrees to sign all Local Agreements and list established sheets as
soon as possible and return them to the Secretary of the Local Union.
Moves and Incentives
- ----------------------
All semi-automatic moves will be 40% higher than side lever moves. The rate of
participation will be the same as side lever moves.
The rate of participation for incentive purposes shall be at the same rate as
in the previous contract.
Management will establish moves for all new items. Setting moves for new items
will be made so that a qualified operator shall have the expectance of
exceeding a standard by an average of 25%. The Company agrees that once a move
is set, it will not be raised for that same type operation. If additional
molds are used, normal increases in moves will apply.
All current moves will be reviewed and adjusted so that a qualified operator
shall have the expectancy of exceeding a standard by an average of 25%
Questions relating to moves may be taken to the Labor-Management Productivity
Committee comprised of not more than four (4) Local # 102 members, and if not
resolved, they shall be a matter for the Grievance Procedure.
Management agrees to furnish graphite and wax at Company expense where needed
as an aid to production as determined by the Foreman.
The Company will furnish gathering tools.
Wages
- -----
Machine Gatherers will be paid on the average of the Pressers' and Gatherers'
rate at 100% Participation.
There will be only two classifications for Hot End Production:
Medium Shop (minimum rate).
Shades Over 12 Diameter (maximum rate)
(Includes any items rated above Medium Shop.)
All Gatherers' rates will be the same as Finishers (except when Finisher is
upgraded for Rolled Edge Plates or any other upgrades.
Finisher gets Pressers' wages for Rolled Edge Plates.
Handlers on Baskets and Ladles shall receive "Shades Over 12" Diameter"
Pressers' wages.
Spinning - Gatherers shall receive Pressers' wages on all spinning items.
Reporting For Work.
- ---------------------
A Presser, Gatherer, Finisher, Blower, or Blocker holding a regular position,
reporting for work at his usual time, will be guaranteed at least four (4)
hours' pay for four (4) hours' work at his regular rate unless he has been
instructed not to report. This policy will not apply during floods, fires,
tornadoes, power or fuel failures, machine breakdowns, or other emergencies
beyond Company control.
Skilled Workers - Shop Knockoffs
- -------------------------------------
If a shop works 3 1/2 hours or more on First and Second Shift and is knocked off
by the Foreman, due to no fault of the shop, the Skilled Workers will receive
four (4) hours' pay.
The usual shift differential will continue to be paid on a proportionate basis
as in the past based on the number of hours worked.
Third Shift - Filling In For Absent Presser.
- ----------------------------------------------------
It is mutually agreed between the Company and Local # 102 that if the Third
Shift Presser is absent from work on a temporary basis, the Company has the
right to assign a Dauber to fill in pressing, subject to the following rules:
All skilled card-holding employees or assigned apprentices must be given first
preference.
Such assignment shall in no way interfere with the established sequence of
putting on new Pressers when needed.
The intent of this Agreement is to provide a method of keeping shops working
on the Third Shift, not essentially to break in new Pressers.
Equipment
- ---------
The Company will provide all Union Card-Holding Pressers employed at Smith
Glass with a new pair of shears if needed, contingent upon return of old
shears for replacement.
The Company will also replace any tools normally used by the Presser that are
worn out or broken, provided they are turned in.
Stolen tools will not be replaced by the Company.
Shades With Center Holes
- ---------------------------
The hole in all shades will be started in the Hot End. If the shop is having
trouble with checks, the Foreman has the responsibility either to solve the
problem or to send the ware in without starting the hole. Such ware will be
designated for drilling in the Cold End. Every attempt must be made to
properly start the hole in the Hot End. If it cannot be done, the shades can
be drilled in the Cold End until the Proper method is worked out in the Hot
End.
While Management desires to resolve particular production problems such as
this, Management still retains its prerogative to make the determination as to
the most effective manufacturing procedures.
Skilled Relief
- ---------------
If an employee relieves two (2) or three (3) people, 100% participation for
incentive will apply if breaks are given accordingly.
Skilled Maintenance
- --------------------
All Skilled Maintenance jobs shall be posted for qualified people before
hiring outside the factory.
Tool Allowance For Pressers
- ------------------------------
The Company agrees to replace worn out or broken tools normally used in the
operation when turned in to supervisors. Tools stolen will not be replaced by
the Company.
ARTICLE 33 SUPPLEMENTARY AGREEMENT #2 (MOULD MAKING DEPARTMENT)
---------------------------------------------------------
The following Agreement applies to those Union employees in the Mould Making
Department Local #102 working at the L.E. Smith Glass Company, located at
Mount Pleasant, Pennsylvania, and is part of and supplementary to the General
Agreement entered into by and between the Company and the Union.
The Company agrees to recognize the Rules of Government or Mould Making Work,
press Branch, as agreed to for the period covered by this contract.
Vacation period for the Mould Making Department shall be agreed to between the
Foreman and employees of the Mould Shop. Eligibility rules shall be the same
as the Press Ware Department.
The Company agrees that the Mould Shop shall be swept and cleaned at least
once each week.
Mould Making Department Hourly Minimum Rate
- ------------------------------------------------
The Company agrees to pay the hourly wage rates for Journeymen and Apprentice
Mould Makers that is negotiated in the wage conference between the S.C.I.R.C.
Group and on the same dates as specified in the National Mould Makers
Agreement.
In the case of Mould Makers physically unable to perform an average day's
work, the rate shall be set by the Local Union, the Manufacturer, and the
individual worker involved.
Vacation Pay
- -------------
All Mould Makers and Apprentices shall be paid their base hourly wage rate for
Vacation Pay, as described in Article 16.
Mould Makers will receive their first week's vacation pay on the last payday
preceding the vacation period. If not eligible for a second week's vacation
pay, said Mould Maker will be paid the week before vacation pay the second
week of vacation.
Vacation pay is subject to all taxes in effect at the time of payment.
Holiday Pay
- ------------
All Mould Makers and Apprentices shall be paid their base rate of pay, as
described in Article 9, for each of the following holidays: New Year's, Good
Friday, Easter Monday, Memorial Day, Labor Day, Thanksgiving Day, Day After
Thanksgiving, and Christmas.
Whenever it would occur that a Mould Maker or Apprentice would be called in to
work on a paid holiday, he would be paid double time plus holiday pay. Work on
a holiday shall be voluntary with the Mould Makers and Apprentices.
Paid Holidays. When a holiday falls on Saturday, it shall be paid for whether
- --------------
the employee would be scheduled to work or not.
Call-In Pay. A Mould Maker who is called to work after leaving the factory
- -------------
will be given an opportunity to earn at least four (4) hours' pay at his
regular base rate. If the employee chooses to return home after completing the
task for which he was called, he shall be paid for the time worked, with a
minimum of two (2) hours' pay at his regular base rate. It is understood that
if a greater amount of earnings would result from application of any of the
overtime provisions of the contract to the time worked, the employees will be
paid the greater amount. Such minimum guarantees do not apply in case of work
immediately prior to the employee's scheduled shift.
Multiple Work Assignments
- ---------------------------
Mould Makers and Apprentices shall not be assigned to operate two machines
simultaneously or to operate a machine and do bench work, etc. while the
machine is in cycle, except work of a nature that Machine Operators have
performed in the industry in the past during machine cycle, if the cycle time
is sufficient. No manufacturer shall be required to change its present
practice of assigning work.
Nothing herein shall be construed as placing any limitations upon a
manufacturer's right to make work assignments not involving dual or multiple
operations or from introducing new processes, equipment, materials, or methods
of operation, from time to time as it deems desirable.
Both the Union and the L.E. Smith Glass Company recognize that new techniques
in manufacturing moulds which are substantially different from existing
machines, and methods may be developed in the future which involve dual or
multiple operations. Therefore, during the term of the Contract, a joint
meeting shall be held with the Negotiating Committee of the Company and the
Union within thirty (30) days following a written request by either the
International President of the Union or the Company to the other for the
purpose of exploring and making recommendations, if possible, concerning
procedures to be followed so that the introduction of such new machines or
methods can be carried out in a harmonious manner, giving due consideration to
the interest of both the employee and the Company.
The Company will operate new substantially different equipment involving dual
or multiple operations under the provisions of Section 1 until the Joint
Committee has had an opportunity to meet. Failing agreement by the Joint
Committee, the Company shall have the right to operate the equipment or
install the new methods in such a manner as they deem desirable, and any
dispute concerning the same shall be referred as the Committee shall direct or
to the next conference.
Tool Allowances
- ----------------
Tools normally used by Mould Makers and Apprentices that are worn out beyond
use or broken will be replaced by the Company, provided they are turned in.
Stolen tools will not be replaced by the Company.
ARTICLE 34 DURATION
--------
The above shall constitute the Complete Agreement, which shall continue in
effect until August 31, 2001, and thereafter so long as negotiations for a new
or modified Agreement shall continue.
Signed this 28th day of August, 1998, by the duly authorized representatives
of the parties hereto:
THE L.E. SMITH GLASS COMPANY:
Martin J. Noonan, Managing Director
/s/ Martin J. Noonan
________________________________________________
Forrest L. Kastner, Plant Manager
/s/ Forrest L. Kastner
____________________________________________________
THE AMERICAN FLINT GLASSWORKERS UNION:
Richard G. Morgan, National President
/s/ Richard G. Morgan
________________________________________________
Ivan T. Uncapher, National Secy./Treas.
/s/ Ivan T. Uncapher
_______________________________________________
Dale Lamb, National Asst. Secy.
/s/ L. Dale Lamb
_____________________________________________________
LOCAL # 102
Bill Rodgers, President
/s/ Bill Rodgers
_____________________________________________________________
George Eicher, Corresponding Secy.
/s/ George Eicher
__________________________________________________
Mark Kraisinger, Financial Secy.
/s/ Mark Kraisinger
_____________________________________________________
Floyd Fulmer, Hot End Committee
/s/ Floyd Fulmer
___________________________________________________
LOCAL # 537
Donna Fulmer, President
/s/ Donna Fulmer
___________________________________________________________
Barbara Hurst, Vice President
/s/ Barbara Hurst
_______________________________________________________
Lois Monroe, Corresponding Secy.
/s/ Lois Monroe
___________________________________________________
Steve Postlethwait, Financial Secy.
/s/ Steve Postlethwait
___________________________________________________
Lawrence DePalma, Hot End Chairperson
/s/ Lawrence DePalma
______________________________________________
P. Jane Tlumac, Cold End Chairperson
/s/ P. Jane Tlumac
________________________________________________
HOT METAL HOURLY WAGES
SHADES OVER 12 DIAMETER MEDIUM SHOP
---------------------------- -----------
9-7-98 9-6-99 9-4-00 9-7-98 9-6-99 9-4-00
------ ------ ------ ------ ------ ------
01 Presser 11.80 12.70 13.60 11.20 12.10 13.00
02 Gatherer 11.69 12.59 13.49 11.06 11.96 12.86
03 Finisher 11.69 12.59 13.49 11.06 11.96 12.86
15 Gatherer
2nd 11.69 12.59 13.49 -- -- --
16 Gatherer
(SA) 11.75 12.65 13.55 11.17 12.07 12.97
17 Presser
(SA) 11.75 12.65 13.55 11.17 12.07 12.97
13 Handler 11.80 12.70 13.60 11.80 12.70 13.60
04 Turn Out 9.22 9.62 10.02 9.14 9.54 9.94
05 Warm In 9.22 9.62 10.02 9.14 9.54 9.94
06 Glazier 9.22 9.62 10.02 9.14 9.54 9.94
07 Carry Over 9.04 9.44 9.84 8.98 9.38 9.78
08 Spare 9.04 9.44 9.84 8.98 9.38 9.78
09 Handle
Gatherer 9.27 9.67 10.07 9.27 9.67 10.07
10 Straighten 9.22 9.62 10.02 9.14 9.54 9.94
11 Catch Out 9.22 9.62 10.02 9.14 9.54 9.94
12 Carry In 9.04 9.44 9.84 8.98 9.38 9.78
14 Ring Lifter 9.22 9.62 10.02 9.14 9.54 9.94
18 Sprayer 9.22 9.62 10.02 9.14 9.54 9.94
<PAGE>
HOT METAL HOURLY WAGES
9-8-98 9-6-99 9-4-00
------ ------ ------
18 Spraying 9.14 9.54 9.94
19 Head Sprayer 9.42 9.82 10.22
22 Labor 9.47 9.87 10.27
24 Batch Mix (Head) 9.98 10.38 10.78
25 Batch Mix (Assistant) 9.80 10.20 10.60
26 Tank Filler 9.40 9.80 10.20
27 Tank Tender 9.60 10.00 10.40
28 Head Mold Cleaner 9.54 9.94 10.34
29 Mold Cleaning (Chuck) 9.22 9.62 10.02
30 General Labor (Forming) 8.98 9.38 9.78
32 Floor (Forming) 9.22 9.62 10.02
80 General Labor (Polish) 8.98 9.38 9.78
81 Permanent Labor 9.34 9.74 10.14
82 General Labor 8.98 9.38 9.78
84 General Labor (Whse.) 8.98 9.38 9.78
MAINTENANCE
BUILDING MAINTENANCE HELPER
70 Starting Rate 9.57 9.97 10.37
71 After 60 Days Probation 9.69 10.09 10.49
72 After 6 Months 10.56 10.96 11.36
HEAD BUILDING MAINTENANCE
73 Starting Rate 10.56 10.96 11.36
74 After 60 Days Probation 10.69 11.09 11.49
75 After 6 Months 11.39 11.79 12.19
79 Special 11.89 12.29 12.69
HEAD MECHANIC
76 Starting 11.39 11.79 12.19
77 After 60 Days Probation 11.80 12.20 12.60
78 After 6 Months 12.30 12.70 13.10
96 Mechanic 11.39 11.79 12.19
<PAGE>
COLD METAL HOURLY WAGES
9-7-98 9-6-99 9-4-00
------ ------ ------
39 Pack Station 8.90 9.30 9.70
40 Floor Work 8.90 9.30 9.70
41 Order Picker 8.90 9.30 9.70
42 Pack Jars 8.94 9.34 9.74
43 Grinding 8.95 9.35 9.75
44 Lehr Tender 9.14 9.54 9.94
45 Shipper 9.28 9.68 10.08
46 Truck Driver 9.25 9.65 10.05
47 Head Carton 10.11 10.51 10.91
48 Grinder Jars 9.33 9.73 10.13
49 Grinder Jars 9.33 9.73 10.13
50 Grinder Jars 9.33 9.73 10.13
51 Decorating & Glueing 8.94 9.34 9.74
52 Samples & UPS 9.28 9.68 10.08
53 Driller 9.25 9.65 10.05
54 Hand Truck 9.10 9.50 9.90
55 Tow Motor 9.18 9.58 9.98
METAL BANDING
- --------------
61 Metal Banding Starting 8.94 9.34 9.74
62 After 2 Months 8.99 9.39 9.79
HAND DECORATING
- ----------------
62 Starting Rate 8.99 9.39 9.79
63 After 2 Month 9.05 9.45 9.85
64 After 4 Months 9.17 9.57 9.97
65 After 6 Months 9.28 9.68 10.08
66 After 12 Months 9.40 9.80 10.20
67 Sprayer 9.25 9.65 10.05
68 Sandblaster 9.25 9.65 10.05
83 Carton Helper 9.25 9.65 10.05
85 Abrasive Cutting 9.28 9.68 10.08
86 Romance Lights Glue 8.90 9.30 9.70
87 Etcher 9.25 9.65 10.05
91 Assembly Line 8.90 9.30 9.70
92 Utility 8.90 9.30 9.70
93 Sawing 9.10 9.50 9.90
94 Washing 8.90 9.30 9.70
95 Polishing 8.95 9.35 9.75
<TABLE> <S> <C>
<CAPTION>
<S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> Jun-30-1999
<PERIOD-START> Jul-01-1998
<PERIOD-END> Dec-31-1998
<CASH> 1,780
<SECURITIES> 0
<RECEIVABLES> 1,903
<ALLOWANCES> 93
<INVENTORY> 2,537
<CURRENT-ASSETS> 6,334
<PP&E> 10,162
<DEPRECIATION> 2,495
<TOTAL-ASSETS> 14,196
<CURRENT-LIABILITIES> 5,688
<BONDS> 1,453
<COMMON> 101
0
5
<OTHER-SE> 6,726
<TOTAL-LIABILITY-AND-EQUITY> 14,196
<SALES> 8,229
<TOTAL-REVENUES> 9,481
<CGS> 5,624
<TOTAL-COSTS> 6,503
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 42
<INTEREST-EXPENSE> 140
<INCOME-PRETAX> 1,184
<INCOME-TAX> 262
<INCOME-CONTINUING> 922
<DISCONTINUED> (238)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 684
<EPS-PRIMARY> .08
<EPS-DILUTED> .08
<FN>
This schedule contains summary financial information extracted from the
consolidated financial statements of NBI, Inc. for the six months ended
December 31, 1998 and is qualified in its entirety by reference to such
financial statements.
</TABLE>
