SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
- --- OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 1994
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-8186
Inter-Regional Financial Group, Inc.
(Exact name of registrant as specified in its charter)
DELAWARE 41-1228350
(State or other jurisdiction (IRS Employer
of incorporation of organization) Identiciation Number)
Dain Bosworth Plaza, 60 South Sixth Street
Minneapolis, Minnesota 55402-4422
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (612) 371-7750
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
As of July 31, 1994, the Company had 8,086,708 shares of common
stock outstanding.
<PAGE>
INTER-REGIONAL FINANCIAL GROUP, INC. AND SUBSIDIARIES
REPORT ON FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1994
INDEX Page
I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
II. OTHER INFORMATION:
Item 4. Submission of Matters to a Vote of Security Holders
Item 6. Exhibits and Reports on Form 8-K
Signatures
Index of Exhibits
Exhibits
<PAGE>
PART I - FINANCIAL INFORMATION
<TABLE>
ITEM 1. FINANCIAL STATEMENTS
INTER-REGIONAL FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
<CAPTION>
June 30, December 31,
1994 1993
--------------------
(Unaudited)
<S> <C> <C>
Assets:
Cash and cash equivalents $12,266 $14,047
Cash and short-term investments
segregated for regulatory purposes 375,000 581,005
Receivable from customers 592,552 531,636
Receivable from brokers and dealers 175,735 178,448
Securities purchased under agreements
to resell 272,861 111,887
Trading securities owned, at market 287,314 271,378
Equipment, leasehold improvements and
buildings, net 27,450 24,720
Other receivables 54,017 40,744
Deferred income taxes 18,995 18,995
Other assets 11,854 13,162
------- -------
$1,828,044 $1,786,022
========= =========
Liabilities and Shareholders' Equity:
Liabilities:
Short-term borrowings $112,956 $123,973
Drafts payable 28,849 32,041
Payable to customers 799,375 866,144
Payable to brokers and dealers 230,033 250,594
Securities sold under repurchase
agreements 176,528 83,978
Trading securities sold, but not yet
purchased, at market 144,858 72,218
Accrued compensation 50,836 83,458
Other accrued expenses and accounts
payable 67,499 63,776
Accrued income taxes 5,864 9,991
Subordinated and other debt 21,235 22,166
------- -------
1,638,033 1,608,339
--------- ---------
Shareholders' equity:
Common stock 1,012 1,016
Additional paid-in capital 73,854 73,475
Retained earnings 115,145 103,192
-------- --------
190,011 177,683
-------- --------
$1,828,044 $1,786,022
========= =========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
INTER-REGIONAL FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per-share amounts)
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1994 1993 1994 1993
--------------------------------------
<S> <C> <C> <C> <C>
Revenues:
Commissions $31,198 $33,914 $70,326 $69,360
Principal transactions 31,057 30,295 66,846 67,080
Investment banking and
underwriting 24,368 32,227 52,246 56,774
Interest 17,011 13,836 32,266 26,249
Asset management 4,427 3,005 8,504 5,910
Correspondent clearing 2,762 2,609 5,943 5,394
Other 6,775 6,642 12,538 10,532
------ ------ ------ ------
Total revenues 117,598 112,528 248,669 241,299
Interest expense (8,141) (7,882) (15,533) (14,309)
------- ------- ------- -------
Net revenues 109,457 114,646 233,136 226,990
------- ------- ------- -------
Expenses excluding
interest:
Compensation and
benefits 69,344 71,313 148,068 142,110
Communications 9,136 7,650 17,686 14,590
Occupancy and
equipment rental 6,774 6,031 13,472 11,988
Travel and promotional 4,850 3,706 9,076 6,734
Floor brokerage and
clearing fees 2,452 2,071 4,697 4,146
Other 7,254 7,333 14,430 14,533
------ ------ ------ ------
Total expenses excluding
interest 99,810 98,104 207,429 194,101
------- ------- ------- -------
Earnings:
Earnings before income
taxes 9,647 16,542 25,707 32,889
Income tax expense (3,733) (6,286) (9,622) (12,498)
------ ------ ------ -------
Net earnings $5,914 $10,256 $16, 085 $20,391
====== ======= ======== =======
Earnings per common and
common equivalent share:
Primary $.70 $1.23 $1.90 $2.45
======= ======= ======= =======
Fully diluted $.70 $1.23 $1.90 $2.44
======= ======= ======= =======
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
INTER-REGIONAL FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
<CAPTION>
Six Months Ended June 30,
1994 1993
-------------------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $16,085 $20,391
Adjustments to reconcile earnings to
cash provided (used) by operating
activities:
Depreciation and amortization 3,753 2,597
Deferred income taxes (2,613) (1,569)
Other non-cash items 4,093 5,037
Cash and short-term investments
segregated for regulatory purposes 206,005 51,700
Net receivable from/payable to
brokers and dealers (17,848) (27,132)
Securities purchased under
agreements to resell (160,974) (30,372)
Net trading securities owned and
trading securities sold, but not
yet purchased 56,704 (110,455)
Short-term borrowings and drafts
payable of securities companies (14,209) 141,317
Net payable to customers (127,685) (55,768)
Securities sold under repurchase
agreements 92,550 10,429
Accrued compensation (32,622) (8,472)
Other (14,235) (6,729)
------- -------
Cash provided (used) by operating
activities 9,004 (9,026)
------- -------
Cash flows from financing activities:
Proceeds from:
Issuance of common stock 387 234
Subordinated and other debt 237 4,691
Payments for:
Purchase of common stock (2,182) __
Dividends on common stock (1,962) (973)
Subordinated and other debt (1,168) (658)
Revolving credit agreement, net __ (5,450)
------ ------
Cash (used) by financing activities (4,688) (2,156)
------ ------
Cash flows from investing activities:
Proceeds from investment dividends and
sales 641 1,499
Payments for equipment, leasehold
improvements and other (6,738) (5,348)
------ ------
Cash (used) for investing activities (6,097) (3,849)
------ ------
Increase/(decrease) in cash and cash
equivalents (1,781) (15,031)
Cash and cash equivalents:
At beginning of period 14,047 34,461
------ ------
At end of period $12,266 $19,430
====== ======
Income tax payments totaled $13,750,000 and $13,233,000 and
interest payments totaled $14,605,000 and $14,222,000 during the
six months ended June 30, 1994 and 1993, respectively.
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
Inter-Regional Financial Group, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
A. Condensed Consolidated Financial Statements
The accompanying unaudited interim consolidated financial
statements have been prepared in accordance with the instructions
for Form 10-Q and do not include all the information and
footnotes required by generally accepted accounting principles
for complete financial statements and should be read in
conjunction with the consolidated financial statements and
related notes included in the Company's Annual Report on Form 10-
K for the year ended December 31, 1993. In the opinion of
management, all adjustments necessary for a fair presentation of
such interim consolidated financial statements have been
included. All such adjustments are of a normal recurring nature.
The results of operations for the three-month and six-month
periods ended June 30, 1994 are not necessarily indicative of
results expected for subsequent periods.
Certain prior year amounts in the financial statements have been
reclassified to conform to the 1994 presentation.
B. Lease Commitment
During the first quarter of 1994, Rauscher Pierce Refsnes entered
into an operating lease for new headquarters space in Dallas,
Texas. The lease commences during the third quarter of 1995 and
the minimum rental commitments are as follows: 1995 - $0; 1996 -
$1,294,000; 1997 - $1,340,000; 1998 - $1,340,000; 1999 -
$1,340,000; thereafter $9,892,000.
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
This discussion should be read in conjunction with Item 7,
(Management's Discussion and Analysis) contained in the Company's
Annual Report on Form 10-K for the year ended December 31, 1993.
Summary
Consolidated net revenues (revenues less interest expense)
decreased $5.2 million in the 1994 second quarter over the
comparable 1993 period. The decreases in second quarter net
revenues over 1993 partially offset increases recorded during the
1994 first quarter, resulting in a year-to-date increase of $6.1
million over the prior year. The industry-wide downturn,
triggered by rising interest rates late in the 1994 first
quarter, continued into the second quarter and resulted in weaker
financial markets, higher interest rates, lower securities prices
and reduced levels of municipal and corporate underwritings for
the 1994 second quarter as compared with both the 1993 second
quarter and 1994 first quarter.
Results of Operations:
<TABLE>
Three Months Ended Six Months Ended
June 30, June 30,
1994 1993 1994 1993
------------------ ------------------
<S> <C> <C> <C> <C>
(Unaudited, in thousands)
Net revenues:
Dain Bosworth
Incorporated $68,003 $68,673 $148,644 $138,985
Rauscher Pierce
Refsnes, Inc. 40,714 45,659 83,092 87,484
Corporate, other and
eliminations 740 314 1,400 521
------- ------ ------- -------
$109,457 $114,646 $233,136 $226,990
======= ======= ======= =======
Earnings (Loss) before
income taxes:
Dain Bosworth
Incorporated $5,884 $9,903 $17,296 $20,506
Rauscher Pierce
Refsnes, Inc. 4,437 7,219 9,495 14,250
Corporate, other and
eliminations (674) (580) (1,084) (1,867)
------ ------ ------ ------
$9,647 $16,542 $25,707 $32,889
====== ====== ====== ======
</TABLE>
Commission revenues declined $2.7 million during the 1994 second
quarter versus the second quarter of 1993 due principally to
lower securities prices and declines in sales of over-the-counter
agency, mutual fund and listed securities to individual and
institutional investors. This revenue decrease was partially
offset by the positive effects of possessing a sales force that
was approximately 10 percent larger than the prior year. For the
six months ended June 30, commission revenues increased $1.0
million from 1993 to 1994 primarily due to increased sales of
mutual fund securities by a sales force that was 9 percent
larger.
Principal transaction revenues increased $.8 million during the
second quarter from the comparable prior year period primarily
due to improved equity trading results. For the first half,
principal transaction revenues declined $.2 million from 1993 as
improved equity trading revenues were more than offset by lower
fixed income trading results at Dain Bosworth and Rauscher Pierce
Refsnes that resulted from volatile bond market conditions late
in the 1994 first quarter and decreased demand for fixed income
products.
Investment banking and underwriting revenues declined $7.9
million from the 1993 second quarter and $4.5 million year-to-
date as increased fees earned from advising corporate clients in
merger and acquisition and private placement transactions were
more than offset by declines in underwriting revenues from
corporate and municipal securities due to the presence of less
favorable market conditions in which to raise capital.
Additionally, a significant portion of the decline from the 1993
levels resulted from expected reductions in revenues derived
from municipal refunding transactions, which the Company
anticipates will decline further over the remainder of 1994.
Net interest income increased $2.9 million during the second
quarter and $4.8 million during the first half over comparable
prior year levels chiefly as a result of continued increases in
margin debit balances and spreads, increased spreads on customer
credit balances, larger volumes of stock borrow and stock loan
transactions and increased fixed income inventories.
Asset management revenue increased $1.4 million for the quarter
and $2.6 year-to-date from the comparable 1993 periods due
primarily to increased assets in managed account programs at Dain
Bosworth and Rauscher Pierce Refsnes and, to a lesser extent,
higher money market fund balances managed by Insight Investment
Management.
Compensation and benefits expense declined $2.0 million during
the 1994 second quarter from the 1993 second quarter due largely
to decreased commissions, incentive compensation and related
benefits that declined in conjunction with decreased operating
revenues. This decrease was partially offset by higher costs
related to a 12 percent increase in the average number of
employees. During the 1994 first half, compensation and benefits
increased $6.0 million from the same period of 1993 chiefly as a
result of an 11 percent increase in the average number of
employees.
Expenses other than compensation and benefits increased $3.7
million for the quarter and $7.4 million year-to-date due
primarily to increased usage of communications and market data
and clearing services, increased occupancy expenses resulting
from higher operating costs at the Company's Minneapolis
headquarters due to expansion, and the addition of nine operating
office locations for Dain Bosworth and Rauscher Pierce Refsnes
from first half 1993 levels.
LIQUIDITY AND CAPITAL RESOURCES
As described in Note K to the Consolidated Financial Statements
of the Company's 1993 Annual Report on Form 10-K, Regional
Operations Group, Dain Bosworth and Rauscher Pierce Refsnes must
comply with certain regulations of the Securities and Exchange
Commission and The New York Stock Exchange, Inc., measuring
capitalization and liquidity. All three broker-dealers
continue to operate above minimum net capital standards. At
June 30, 1994, net capital was $49.5 million at Regional
Operations Group, which was 7.6 percent of aggregate debit
balances and $17.0 million in excess of the 5 percent
requirement. At June 30, 1994, Dain Bosworth and Rauscher Pierce
Refsnes had net capital of $21.1 million and $12.6 million,
respectively, in excess of the $1 million requirement.
On April 27, 1994, the Company's Board of Directors announced
that it would double the regular quarterly cash dividend paid on
the Company's common stock from $.08 per share to $.16 per share
beginning with the dividend paid during the 1994 second quarter.
The determination of future cash dividends, if any, to be
declared and paid will depend on the Company's future financial
condition, earnings and available funds. On the same date, the
Company's Board of Directors authorized a plan to repurchase up
to 400,000 shares of the Company's common stock. Purchases of
the common stock will be made from time to time at prevailing
prices in the open market, by block purchases, or in privately
negotiated transactions. The repurchased shares will be used for
the Company's employee stock option and other benefit plans, or
for other corporate purposes. Through July 31, 1994, the Company
had repurchased 139,000 shares in accordance with this program at
a cost of $3.1 million.
<PAGE>
PART II - Other INFORMATION
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the regular Annual Meeting of Stockholders of the Company held
on April 27, 1994, the stockholders elected nine directors,
approved an amendment to the 1986 Stock Option Plan to increase
from 1,000 to 2,000 the number of shares automatically issued to
non-employee directors upon each election or reelection to the
Board, approved the new IFG Restricted Stock Plan for Non-
Employee Directors and ratified the appointment of KPMG Peat
Marwick as the registrant's independent auditors.
Voting results of each of these items were as follows:
Election of Directors:
For Withheld Total
S. Boren 5,918,682 89,861 6,008,543
F.G. Fitz-Gerald 5,903,718 104,825 6,008,543
R.D. McFarland 5,888,049 120,494 6,008,543
L. Perlman 5,917,529 91,014 6,008,543
C.A. Rundell, Jr. 5,834,081 174,462 6,008,543
Robert L. Ryan 5,931,110 77,433 6,008,543
A.R. Schulze, Jr. 5,801,639 206,904 6,008,543
D.A. Smith 5,894,510 114,033 6,008,543
I. Weiser 5,878,688 129,855 6,008,543
Amendment to 1986 Stock Option Plan to increase from 1,000 to
2,000 the number of options automatically issued to non-employee
directors upon each election or reelection to the Board.:
For 4,819,719
Against 1,140,765
Abstain 48,059
---------
SHARES OUTSTANDING 6,008,543
=========
Approval of IFG Restricted Stock Plan for Non-Employee Directors:
For 5,216,931
Against 733,291
Abstain 58,321
---------
SHARES OUTSTANDING 6,008,543
=========
Ratification of Appointment of Auditors:
For 5,938,243
Against 38,586
Abstain 31,714
---------
SHARES OUTSTANDING 6,008,543
=========
<PAGE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 4(a) - Second Amendment to Credit Agreement dated
June 27, 1994
Exhibit 4(b) - Fourth Amendment to Term-Loan Agreement dated
June 27, 1994.
Exhibit 11 - Computation of Net Earnings Per Share.
(b) Reports on Form 8-K
One report on Form 8-K was filed during the quarter ended
June 30, 1994:
Items Reported
Item 5 - Other Events (Doubling of the Company's regular
quarterly cash dividend from 8 cents to 16 cents per share
and authorization of a share repurchase plan)
Item 7 - Financial Statements & Exhibits
Exhibit 28 - Press release regarding the doubling of the
Company's regular quarterly cash dividend from 8 cents to
16 cents per share and authorization of a share repurchase
plan
Date of Report - April 27, 1994.
Financial Statements Filed - None.
<PAGE>
SIGNATURE
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.
INTER-REGIONAL FINANCIAL GROUP, INC.
Registrant
Date: August 11, 1994 By Daniel J. Reuss
------------------ ------------------------
Daniel J. Reuss
Senior Vice President, Controller
and Treasurer (Principal Financial
& Accounting Officer)
<PAGE>
INTER-REGIONAL FINANCIAL GROUP, INC. AND SUBSIDIARIES
INDEX OF EXHIBITS TO QUARTERLY REPORT ON FORM 10-Q
FOR QUARTER ENDED JUNE 30, 1994
Exhibit 4(a) - Second Amendment to Credit Agreement dated
June 27, 1994
Filed herewith.
Exhibit 4(b)- Fourth Amendment to Term-Loan Agreement dated
June 27, 1994.
Filed herewith.
Exhibit 1 - Computation of Net Earnings Per Share
Filed herewith.
<PAGE>
Exhibit 4(a)
SECOND AMENDMENT TO CREDIT AGREEMENT
This Amendment is made as of this 27th day of June, 1994, by and
among INTER-REGIONAL FINANCIAL GROUP, INC., a Delaware
corporation (the "Borrower"), the financial institutions that
have executed this Amendment (the "Banks") and Norwest Bank
Minnesota, National Association, a national banking association,
as agent for the Banks (the "Agent").
The Borrower, the Banks and the Agent have entered into a Credit
Agreement dated as of June 23, 1993, as amended by a First
Amendment to Credit Agreement dated as of November 30, 1993 (the
"Credit Agreement") by and among the Borrower, the Banks and the
Agent, as amended from time to time. The Banks have agreed,
severally but not jointly, to make loans to the Borrower on the
terms and conditions set forth in the Credit Agreement.
Loans made by the Banks under the Credit Agreement are evidenced
by promissory notes dated as of June 23, 1993 executed by the
Borrower in favor of each Bank (each, a "Note"). The Notes
mature on June 30, 1995.
The Borrower has requested that the Banks and the Agent amend
certain provisions of the Credit Agreement, and the Banks and the
Agent are willing to do so pursuant to the terms and conditions
set forth in this Agreement.
ACCORDINGLY, the parties hereto hereby agree as follows:
1. Terms used in this Amendment which are defined in the Credit
Agreement shall have the same meanings as defined therein, unless
otherwise defined herein.
2. Section 6.04(d)(i) of the Credit Agreement is hereby amended
in its entirety to read as follows:
"(i) the aggregate amount of such investments, loans or
advances which are to Subsidiaries other than ROG and which have
a term or maturity of more than six months when made shall not
exceed $25,000,000 in the aggregate at any one time outstanding;"
3. Section 6.04(d)(ii) of the Credit Agreement is hereby amended
in its entirety to read as follows:
"(ii) the aggregate amount of such investments, loans or
advances in or to ROG shall be without limitation;"
4. The Banks hereby waive the Borrower's violation of Section
7.01(n) of the Credit Agreement during the period from December
31, 1993 through February 28, 1994 arising as a result of the New
York Stock Exchange review of Dain Bosworth Incorporated's
capital treatment of certain security positions held in inventory
at December 31, 1993. Nothing in this paragraph 4 shall be
deemed a waiver of any other Default or Event of Default or of
any other violation of Section 7.01(n) other than the specific
violation described above.
5. Except as explicitly amended by this Amendment, all of the
terms and conditions of the Credit Agreement shall remain in full
force and effect and shall apply to any advance or letter of
credit thereunder.
6. The Borrower hereby represents and warrants to the Lender as
follows:
(a) The Borrower has all requisite power and authority to
execute this Amendment and to perform all of its obligations
hereunder, and this Amendment has been duly executed and
delivered by the Borrower and constitutes the legal, valid and
binding obligation of the Borrower, enforceable in accordance
with its terms.
(b) The execution, delivery and performance by the Borrower of
this Amendment have been duly authorized by all necessary
corporate action and do not (i) require any authorization,
consent or approval by any governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign,
(ii) violate any provision of any law, rule or regulation or of
any order, writ, injunction or decree presently in effect, having
applicability to the Borrower, or the articles of incorporation
or by-laws of the Borrower, or (iii) result in a breach of or
constitute a default under any indenture or loan or credit
agreement or any other agreement, lease or instrument to which
the Borrower is a party or by which it or its properties may be
bound or affected.
(c) All of the representations and warranties contained in
Article IV of the Credit Agreement are correct on and as of the
date hereof as though made on and as of such date, except to the
extent that such representations and warranties relate solely to
an earlier date.
7. All references in the Credit Agreement to "this Agreement"
shall be deemed to refer to the Credit Agreement as amended
hereby; and any and all references in the Loan Documents shall be
deemed to refer to the Credit Agreement as amended hereby.
8. Except as expressly provided in paragraph 4 above, the
execution of this Amendment and acceptance of any documents
related hereto shall not be deemed to be a waiver of any Default
or Event of Default under the Credit Agreement, or breach,
default or event of default under any Loan Document or other
document held by the Agent, whether or not known to the Agent and
whether or not existing on the date of this Amendment.
9. The Borrower hereby absolutely and unconditionally
releases and forever discharges the Agent and the Banks, and any
and all participants, parent corporations, subsidiary
corporations, affiliated corporations, insurers, indemnitors,
successors and assigns thereof, together with all of the present
and former directors, officers, agents and employees of any of
the foregoing, from any and all claims, demands or causes of
action of any kind, nature or description, whether arising in law
or equity or upon contract or tort or under any state or federal
law or otherwise, which the Borrower has had, now has or has made
claim to have against any such person for or by reason of any
act, omission, matter, cause or thing whatsoever relating to the
Credit Agreement and the other Loan Documents arising from the
beginning of time to and including the date of this Amendment,
whether such claims, demands and causes of action are matured or
unmatured or known or unknown.
10. The Borrower hereby reaffirms its agreement under the Credit
Agreement to pay or reimburse the Agent on demand for all costs
and expenses incurred by the Agent in connection with the Loan
Documents and all other documents contemplated thereby, including
without limitation all reasonable fees and disbursements of legal
counsel. Without limiting the generality of the foregoing, the
Borrower specifically agrees to pay all fees and disbursements of
counsel to the Agent for the services performed by such counsel
in connection with the preparation of this Amendment and the
documents and instruments incidental hereto.
11. This Amendment may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an
original and all of which counterparts, taken together, shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
INTER-REGIONAL FINANCIAL GROUP, INC.
By Daniel J. Reuss
-------------------------------
Its Senior Vice President
-------------------------------
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION, as Agent
By Byron Payne
-------------------------------
Its Vice President
-------------------------------
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By Byron Payne
-------------------------------
Its Vice President
-------------------------------
FIRST BANK NATIONAL ASSOCIATION
By Jose Peris
-------------------------------
Its Vice President
-------------------------------
<PAGE>
Exhibit 4(b)
FOURTH AMENDMENT TO TERM LOAN AGREEMENT
This Amendment is made as of this 27th day of June, 1994, by and
between INTER-REGIONAL FINANCIAL GROUP, INC., a Delaware
corporation (the "Borrower") and NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, a national banking association (the "Bank").
The Borrower and the Bank have entered into a Term Loan Agreement
dated as of October 16, 1992, as amended by a First Amendment to
Term Loan Agreement dated as of March 12, 1993, a Second
Amendment to Term Loan Agreement dated as of June 23, 1993, and a
Third Amendment to Term Loan Agreement dated as of November 30,
1993 (as amended, the "Loan Agreement"), pursuant to which the
Bank made the Term Loan to the Borrower subject to the terms and
conditions set forth in the Loan Agreement.
The Term Loan made by the Bank to the Borrower under the Loan
Agreement is evidenced by the Term Note of the Borrower dated
October 16, 1992, payable to the order of the Bank in the
original principal of $2,000,000 (the "Term Note").
The Borrower has requested that the Bank amend certain provisions
of the Loan Agreement and the Bank is willing to do so pursuant
to the terms and conditions set forth in this Agreement.
ACCORDINGLY, the parties hereto agree as follows:
1. All capitalized terms used in this Amendment, unless
specifically defined herein, shall have the meanings given to
such terms in the Loan Agreement.
2. Section 6.04(d)(i) of the Loan Agreement is hereby amended in
its entirety to read as follows:
"(i) the aggregate amount of such investments, loans or
advances which are to Subsidiaries other than ROG and which have
a term or maturity of more than six months when made shall not
exceed $25,000,000 in the aggregate at any one time outstanding;"
3. Section 6.04 (d)(ii) of the Loan Agreement is hereby amended
in its entirety to read as follows:
"(ii) the aggregate amount of such investments, loans or
advances in or to ROG shall be without limitation;"
4. The Bank hereby waives the Borrower's violation of Section
7.01(n) of the Loan Agreement during the period from December 31,
1993 through February 28, 1994 arising as a result of the New
York Stock Exchange review of Dain Bosworth Incorporated's
capital treatment of certain security positions held in inventory
at December 31, 1993. Nothing in this paragraph 4 shall be
deemed a waiver of any other Default or Event of Default or of
any other violation of Section 7.01(n) other than the specific
violation described above.
5. The Borrower hereby represents and warrants to the Bank that:
(a) The Borrower has all requisite power and authority,
corporate or otherwise, to conduct its business, to own its
properties and to execute and deliver this Amendment and perform
all of its obligations under the Loan Agreement, as amended by
this Amendment, and under the Term Note.
(b) The execution, delivery and performance by the Borrower of
its obligations under the Loan Agreement, as amended by this
Amendment, and under the Term Note has been duly authorized by
all necessary corporate action on the part of the Borrower and do
not and will not (1) require any consent or approval of the
stockholders of the Borrower, or any authorization, consent or
approval by any governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, (2)
violate any provision of any law, rule or regulation (including,
without limitation, Regulation X of the Board of Governors of the
Federal Reserve System) or of any order, writ, injunction or
decree presently in effect having applicability to the Borrower
or of the Certificate of Incorporation or Bylaws of the
Borrower,p (3) result in a breach of or constitute a default
under any indenture or loan or credit agreement or any other
agreement, lease or instrument to which the Borrower is a party
or by which the Borrower or its properties may be bound or
affected, or (4) result in, or require, the creation or
imposition of any mortgage, deed of trust, pledge, lien, security
interest or other charge or encumbrance of any nature upon or
with respect to any of the properties now owned or hereafter
acquired by the Borrower.
(c) The Loan Agreement, as amended by this Amendment, and the
Term Note constitute the legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with
their respective terms.
(d) All of the representations and warranties contained in
Article IV of the Loan Agreement are correct on and as of the
date hereof, except to the extent that such representations and
warranties relate solely to an earlier date.
6. On the date this Amendment becomes effective, all
references in the Loan Agreement to "this Agreement" and all
references in the Term Note to the "Term Loan Agreement" shall be
deemed to refer to the Loan Agreement as amended by this
Amendment.
7. Except as explicitly amended by this Amendment, all of the
original terms and conditions of the Loan Agreement and the Term
Note shall remain in full force and effect.
8. The Borrower hereby agrees to pay all reasonable fees and
disbursements of counsel to the Bank for the services performed
by such counsel in connection with the preparation of this
Amendment and any documents or instruments incidental thereto.
9. This Amendment may be executed in any number of
counterparts, each of which shall be deemed to be an original and
all such counterparts, taken together, shall constitute but one
and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed as of the day and year first above written.
INTER-REGIONAL FINANCIAL GROUP, INC.
By Dan Reuss
-----------------------------
Its Senior Vice President
-----------------------------
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By Byron Payne
-----------------------------
Its Vice President
-----------------------------
<PAGE>
Exhibit 11
<TABLE>
INTER-REGIONAL FINANCIAL GROUP, INC.
COMPUTATION OF NET EARNINGS PER SHARE
(Unaudited, amounts in thousands, except per-share data)
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1994 1993 1994 1993
------------------- ------------------
<S> <C> <C> <C> <C>
PRIMARY EARNINGS PER SHARE:
Net earnings $5,914 $10,256 $16,085 $20,391
======= ======= ======= =======
Average number of common and
common equivalent shares
outstanding:
Average common shares
outstanding 8,152 8,112 8,150 8,106
Incentive stock options 240 233 301 232
------ ------ ------ ------
8,392 8,345 8,451 8,338
====== ====== ====== ======
Primary earnings per share $.70 $1.23 $1.90 $2.45
====== ====== ====== ======
FULL DILUTION:
Net earnings $5,914 $10,256 $16,085 $20,391
===== ====== ====== ======
Average number of common and
common equivalent shares
outstanding:
Average common shares
outstanding 8,152 8,112 8,150 8,106
Incentive stock options 240 255 301 258
----- ----- ----- -----
8,392 8,367 8,451 8,364
===== ===== ===== =====
Full diluted earnings per share $.70 $1.23 $1.90 $2.44
===== ===== ===== =====
</TABLE>
