______________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
___
: X : QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
:___: EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
OR
___
: : TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
:___: EXCHANGE ACT OF 1934
For the transition period from __________________ to ___________________
Commission file number 0-1252
__________________________________________________
JOSLYN CORPORATION
______________________________________________________________________________
(Exact name of Registrant as specified in its charter)
Illinois 36-3560095
_______________________________________ _____________________________________
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
30 South Wacker Drive -
Chicago, Illinois 60606
_______________________________________ _____________________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (312) 454-2900
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.
X
YES _____ NO _____
Indicate the number of shares outstanding of each of the issuer's classes
of common stock as of March 31, 1995.
$1.25 Par Value Common Stock 7,162,000 shares
______________________________________________________________________________
Page 1 of 40
<PAGE>
PART I.
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONDENSED FINANCIAL STATEMENTS
The condensed consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations
of the Securities and Exchange Commission. Although certain information and
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been condensed
or omitted pursuant to such rules and regulations, the Company believes that
the disclosures are adequate to make the information presented not misleading.
It is suggested that these condensed consolidated financial statements be read
in conjunction with the financial statements and the notes thereto included in
the latest Annual Report on Form 10-K of the Company for the year ended
December 31, 1994.
The condensed consolidated financial statements included herein reflect all
adjustments, consisting only of normal recurring adjustments which, in the
opinion of management, are necessary to present a fair statement of the
results for the interim periods.
The results of operations for such interim periods are not necessarily
indicative of the results of the full year.
Page 2
<PAGE>
JOSLYN CORPORATION
BALANCE SHEET
MARCH 31, 1995 AND DECEMBER 31, 1994
(Dollar Amounts in Thousands)
<TABLE>
<CAPTION>
======================================================================================================
MARCH DECEMBER|LIABILITIES AND SHARE- MARCH DECEMBER
ASSETS 1995 1994 |HOLDERS' EQUITY 1995 1994
- -------------------------------------------------|----------------------------------------------------
<C> <S> <S> <S> <S> <S>
Current Assets: |Current Liabilities:
|
Cash and Cash Equivalents $ 35,880 $ 39,775 | Accounts Payable $ 10,408 $ 10,674
--------- ---------| Accrued Liabilities 29,644 30,548
Receivables, Less Allowance | Income Taxes 2,330 2,444
for Doubtful Accounts $ 32,323 $ 28,482 | --------- ---------
--------- ---------|Total Current Liabilities $ 42,382 $ 43,666
Inventories: |
Finished Goods $ 8,158 $ 7,703 |Postretirement Medical Liability 14,837 14,712
Work-In-Process 15,070 13,893 |
Raw Materials 14,449 13,968 |Environmental Accrual 38,500 38,500
--------- ---------| --------- ---------
Total Inventories $ 37,677 $ 35,564 | Total Liabilities $ 95,719 $ 96,878
--------- ---------| --------- ---------
Deferred Tax and Other |Shareholders' Equity:
Current Assets $ 13,713 $ 15,804 |
--------- ---------|Common Stock $1.25 Par Value
Total Current Assets $119,593 $119,625 | Authorized 20,000,000 shares
--------- ---------| Issued 7,162,000 shares in 1995
Net Deferred tax and | and 7,154,000 shares in 1994. $ 8,953 $ 8,943
Other Assets $ 20,611 $ 19,924 |
--------- ---------|Retained Earnings 73,815 72,321
Plant and Equipment, at Cost $ 84,068 $ 83,084 |
Less Accumulated Depreciation (46,308) (45,129)|Equity Adjustments (523) (638)
--------- ---------| --------- ---------
Net Plant and Equipment $ 37,760 $ 37,955 |Total Shareholders' Equity $ 82,245 $ 80,626
--------- ---------| --------- ---------
|Total Liabilities and
Total Assets $177,964 $177,504 | Shareholders' Equity $177,964 $177,504
======================================================================================================
</TABLE>
Page 3
<PAGE>
JOSLYN CORPORATION
CONDENSED INCOME STATEMENT
FOR THE QUARTER ENDED MARCH 31, 1995 AND 1994
(Dollar Amounts in Thousands Except Per Share Amounts)
Quarter Ended
March 31,
1995 1994
---------------------
Net Sales $ 56,523 $ 53,919
Cost of Goods Sold 42,360 39,151
Selling and General Expenses 9,116 8,992
Other Expense, Net 94 310
Investment Income (391) (380)
---------- ----------
Income before Income Taxes $ 5,344 $ 5,846
Income Taxes 1,850 2,100
---------- ----------
Net Income $ 3,494 $ 3,746
========== ==========
Per Share of Common Stock:
Net Income $ .49 $ .53
========== ==========
Dividends $ .30 $ .30
========== ==========
Average Number of Shares Outstanding 7,159,000 7,107,000
========== ==========
Page 4
<PAGE>
JOSLYN CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND 1994
(Dollar Amounts in Thousands)
1995 1994
-------- --------
Cash Flows from Operating Activities:
Net Income from Operations $ 3,494 $ 3,746
Adjustments to Reconcile Net Income to Net
Cash Flows from Operating Activities:
Depreciation and Amortization 1,265 1,329
Deferred Income Taxes (133) 202
Change in Assets and Liabilities:
(Increase) in Receivables (3,841) (3,208)
(Increase) Decrease in Inventories (2,113) 1,103
(Decrease) in Accounts Payable (266) (2,561)
(Decrease) in Current and Long-term
Environmental Accruals (270) (596)
Other, Net 842 (943)
-------- --------
Net Cash Flows from Operating Activities $(1,022) $ (928)
-------- --------
Cash Flows from Investing Activities:
Capital Expenditures $(1,379) $ (944)
Acquisition of Product Line - (2,500)
Disposition of Product Line - 540
Other, Net 496 (166)
-------- --------
Net Cash Flows from Investing Activities $ (883) $(3,070)
-------- --------
Cash Flows from Financing Activities:
Dividends Paid $(2,148) $(2,132)
Other, Net 158 90
-------- --------
Net Cash Flows from Financing Activities $(1,990) $(2,042)
-------- --------
Net (Decrease) in Cash and Cash Equivalents $(3,895) $(6,040)
======== ========
Supplemental Disclosures:
Income Taxes Paid $ 205 $ 521
Interest Paid 29 35
======== ========
Page 5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
- -----------------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
- -----------------------------------------------
As of March 31, 1995, the working capital ratio for the
Corporation remained strong at 2.82 to 1 compared to 2.74 to 1
at December 31, 1994.
Significant Balance Sheet fluctuations between March 31, 1995
and December 31, 1994 were 1) Accounts Receivable was $3.8
million greater primarily because sales in March 1995 were
$4.6 million, or 28.7%, greater than in December 1994 and 2)
Deferred Tax and Other Current Assets was $2.1 million, or
13.2%, less on March 31st due to a shift in the timing and
classification of income tax benefits.
Results of Operations
Consolidated sales and operating income by business segments for the
quarter ended March 31, 1995 and 1994 are as follows (000 omitted):
Quarter Ended Increase
March 31, (Decrease)
------------------ ---------------
1995 1994 Dollars Percent
-------- -------- ------- ------
Net Sales
Electrical Switches and Controls $34,362 $33,136 $1,226 4 %
Utility Line Products 22,161 20,783 1,378 7
-------- -------- ------- ------
Total $56,523 $53,919 $2,604 5
======== ======== ======= ======
Operating Income
Electrical Switches and Controls $ 4,668 $ 5,442 $ (774) (14)
Utility Line Products 1,403 1,442 (39) (3)
-------- -------- ------- ------
Total $ 6,071 $ 6,884 $ (813) (12)
======== ======== ======= ======
Net sales increased $2.6 million or 5% over the first quarter of 1994
but operating income decreased $0.8 million or 12%.
The Electrical Switches and Controls segment net sales increased 4%
and operating income decreased 14% for the first quarter of 1995
compared to the corresponding quarter in 1994. There were strong
performances by the power quality, protection and controls businesses
within this segment, especially from Joslyn Jennings and Joslyn Clark
Controls reflecting higher demand for their product offerings. These
improvements and others were partially offset by 1) lower sales and
operating income in the power switches and related controls business
Page 6
<PAGE>
because of a one and one-half week strike at Hi-Voltage and 2) weak
and competitive markets for SF6 switches. Also, a non-core
dehydration business had lower sales and an operating loss in the
first quarter of 1995.
The Utility Line Products business segment's net sales increased $1.4
million or 7% and operating income decreased $39,000 or 3% in
the first quarter of 1995 compared to the first quarter of 1994.
Sales increased because of the acquisition of the Stanley Flagg
product line toward the end of the first quarter of 1994 and strong
metal oxide distribution arrester sales. The decrease in operating
income reflects primarily higher raw material steel costs and some
shifts in product mix to lower margin items.
The gross profit as a percent of sales decreased to 25.1% in the
first quarter of 1995 from 27.4% in the first quarter of 1994
primarily due to some increased raw material costs, costs related to
the strike at Hi-Voltage and shifts in product mix.
Page 7
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
_________________
Not Applicable
Item 2. Changes in Securities
_____________________
Not Applicable
Item 3. Defaults Upon Senior Securities
_______________________________
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders
___________________________________________________
Not Applicable
Item 5. Other Information
_________________
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
________________________________
3(a) Articles of Incorporation, as amended
10 Materials Contract
(a) Executive Management Incentive Plan, as amended
27 Financial Data Schedule
Page 8
<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.
JOSLYN CORPORATION
Registrant
Date: May 11, 1995 /s/ Lawrence G. Wolski
_______________________________
Lawrence G. Wolski
Acting Chief Executive Officer
Date: May 11, 1995 /s/ Raymond G. Bjorseth
________________________________
Raymond G. Bjorseth
Controller
Page 9
File Number 5495 085 3
STATE OF ILLINOIS
OFFICE OF THE SECRETARY OF STATE
WHEREAS, Articles of Exchange of Joslyn Holding Company Incorporated
under the laws of the State of Illinois have been filed in the Office of the
Secretary of State as provided by the Business Corporation Act of Illinois,
in force July 1, A.D. 1984.
NOW, THEREFORE, I, Jim Edgar, Secretary of State of the State of Illinois,
by virtue of the powers vested in me by law, do hereby issue this certificate
and attach hereto a copy of the Application of the aforesaid corporation.
IN TESTIMONY WHEREOF, I hereto set my hand and cause to be affixed the
Great Seal of the State of Illinois at the City of Springfield, this 28th day
of April AD 1988 and of the Independence of the United States the two hundred
and 12.
SEAL /S/ JIM EDGAR
____________________________
Secretary of State
Page 10
<PAGE>
JIM EDGAR
Secretary of State
State of Illinois
ARTICLES OF EXCHANGE
Pursuant to the provisions of "The Business Corporation Act of 1983", the
undersigned corporation(s) hereby adopt(s) the following Articles of Exchange.
1. The names of the corporation proposing to exchange shares and the State
or Country of their incorporation, are:
NAME OF CORPORATION STATE OR COUNTRY OF INCORPORATION
Joslyn Corporation Illinois
Joslyn Holding Company Illinois
2. The laws of the State or Country under which each corporation is
incorporated permit such exchange.
3. The name of the acquiring corporation is Joslyn Holding Company
and it shall be governed by the laws of Illinois.
4. The plan of exchange is as follows:
See Exhibit A attached hereto.
Page 11
<PAGE>
5. The plan of exchange was approved, as to each corporation as follows:
By the shareholders, a resolution of the board of directors having
been duly adopted and submitted to a vote at a meeting of shareholders.
Not less than the minimum number of votes required by statute and by
the articles of incorporation voted in favor of the actions taken.
(Statutory Section 11.20)
NAME OF CORPORATION
Joslyn Corporation X
By written consent of all the shareholders entitled to vote on the
action in accordance with (Statutory Sections 7.10 & 11.20).
Joslyn Holding Company X
Page 12
<PAGE>
AGREEMENT AND PLAN OF EXCHANGE
This AGREEMENT AND PLAN OF EXCHANGE ("Agreement"), is entered into as of
February 10, 1988, pursuant to Section 11.25 of the Illinois Business
Corporation Act of 1983 (the "BCA") between Joslyn Holding Company, an Illinois
corporation ("Holding"), and Joslyn Corporation, an Illinois corporation
("Joslyn").
WHEREAS, the authorized capital stock of Joslyn consists of 10,000,000
Common Shares $1.25 par value per share ("Common shares"), of which 4,788.571
shares were issued and outstanding as of February 10, 1988; and *
WHEREAS, Holding is a wholly owned subsidiary of Joslyn with authorized
capital stock consisting of 20,000,000 Common Shares $1.25 par value per share
("Holding Common Shares"), of which one share is issued and outstanding and
owned of record by Joslyn, and
WHEREAS, the board of directors of Joslyn believes that it is in the best
interest of its shareholders and employees to transfer the ownership of Joslyn
to Holding so that Holding will be owned by the shareholders of Joslyn and
Joslyn will become a subsidiary of Holding, all pursuant to the plan of
exchange (the "Plan of Exchange") contemplated by this Agreement;
NOW, THEREFORE, in order to carry out the Plan of Exchange and in
consideration of the mutual agreements hereinafter contained, the parties
hereto agree with respect to the exchange provided for herein that at the
Effective Time, (as hereinafter defined), each Joslyn Common Share issued and
outstanding immediately prior to the Effective Time will be exchanged for one
Holding Common Share, and that the terms and conditions of the Exchange (as
hereinafter defined) and the method of carrying the same into effect are as
follows:
ARTICLE I
PLAN OF EXCHANGE
1.1 EFFECTIVE TIME OF THE PLAN OF EXCHANGE. If the conditions set forth
in Article IV of the Agreement are duly satisfied or, to the extent permitted
by this Agreement, waived by one or more of the parties hereto as hereinafter
provided, and if this Agreement has not been terminated pursuant to Article V
hereof, articles of share exchange duly executed in accordance with Section
11.25 of the BCA shall be filed by the parties hereto with the Secretary of
State of Illinois. The Effective Time shall be the time when the articles of
share exchange are accepted for filing by the Illinois Secretary of State.
* includes 411,527 treasury shares
An additional 11,600 shares were cancelled between February 10, 1988 and
April 26, 1988. As a result, there are 4,766,971 outstanding shares on
April 26, 1988, all of which will be converted pursuant to Section
1.2(a).
Page 13 1
<PAGE>
1.2 EXCHANGE OF COMMON SHARES OF JOSLYN. At the Effective Time the
following (the "Exchange") shall occur:
(a) Without any action being required on the part of the holder
thereof but subject to the right to exercise dissenters' rights pursuant
to Section 11.65 of the BCA, each Joslyn Common Share issued and
outstanding immediately prior to the Effective Time shall be exchanged
for one Holding Common Share, which shall thereupon be fully paid and
non-assesssable;*
(b) Holding shall become the owner and holder of all the issued
and outstanding Joslyn Common Shares; and
(c) Each Holding Common Share Issued and outstanding immediately
prior to the Effective Time shall be cancelled and shall thereupon
become an authorized and unissued Holding Common Share.
ARTICLE II
MANNER AND EFFECT OF EXCHANGE
2.1 SHAREHOLDER RIGHTS. At the Effective Time, the holders of Joslyn
Common Shares shall cease to have any rights as shareholders of Joslyn and
their sole rights shall be as shareholders of Holding or to receive payment
of the fair value of such Joslyn Common Shares in the case of the exercise of
such dissenters' rights pursuant to Section 11.70 of the BCA.
2.2 SURRENDER AND EXCHANGE OF CERTIFICATES FOR HOLDING COMMON SHARES.
After the Effective Time, each holder of an outstanding certificate or
certificates theretofore representing Joslyn Common Shares may, but shall not
be required to, surrender the same to Holding for cancellation and issuance
of a new certificate or certificates in such holder's name or for cancellation
and transfer, and each such holder or transferee shall be entitled to receive
a certificate or certificates representing the same number of Holding Common
Shares as the number of Joslyn Common Shares previously represented by the
certificate or certificates surrendered. Until so surrendered or presented
for transfer, each outstanding certificate which immediately prior to the
Effective Time, evidenced Joslyn Common Shares shall be deemed and treated
for all purposes to evidence the ownership of the same number of Holding
Shares.
2.3 JOSLYN PLANS AFTER THE EXCHANGE. At the Effective Time, the
following shall occur:
(a) Holding shall assume, satisfy and perform when due, all
obligations and liabilities theretofore or thereafter arising under
* The treasury shares of Joslyn will remain as treasury shares.
Page 14 2
<PAGE>
or pursuant to, and Holding will be vested with the powers, rights and
privileges of Joslyn under Joslyn's Employee Stock Benefit Plan (the
"Stock Benefit Plan") and under each Incentive Stock Option, Non-
Qualified Stock Option and tandem Stock Appreciation Right granted
under such plan prior to the Effective Time that remains unexercised
and has not expired or been terminated prior to the Effective Time
(the "Outstanding Stock Rights"). At the Effective Time, each
Outstanding Stock Right that is an incentive Stock Option or a Non-
Qualified Stock Option will become an option to purchase that
number of Holding Common Shares equal to the number of Joslyn Common
Shares subject to the Outstanding Stock Right immediately prior to the
Effective Time and each Outstanding Stock Right that is a tandem stock
appreciation right in tandem with the option into which its related
stock option was converted. The terms of each assumed stock option or
tandem stock appreciation right after the Effective Time will be no
more or no less favorable to the holder thereof than the terms and
conditions of the related outstanding stock option or tandem stock
appreciation right prior to the Effective Time and will not give the
holder thereof benefits and he did not have under such option or right
prior to the Effective Time. Incentive Stock Options, Non-Qualified
Stock Options and tandem Stock Appreciation Rights granted under the
Stock Benefit Plan from and after the Effective Time will cover Holding
Common Shares.
(b) Holding shall assume, satisfy and perform when due, all
obligations and liabilities theretofore or thereafter arising under or
pursuant to Joslyn's Sustained Growth and Profitability Incentive
Compensation and Stock Purchase Plan (the "Incentive Plan") and
Holding will be vested with the powers, rights and privileges of Joslyn
Page 15 3
<PAGE>
under such plan. In all other respects such plan and the interest of
the participants therein and the beneficiaries thereof shall remain
unchanged.
(d) Holding shall assume, satisfy and perform when due all
obligations and liabilities theretofore or thereafter arising under or
pursuant to Joslyn's Employees' Savings and Profit Sharing Plan and
Holding will be vested with the powers, rights and privileges of Joslyn
under such plan. In all other respects such plan and the interest of
the participants therein and the beneficiaries thereof shall remain
unchanged.
(e) Holding and Joslyn will take all necessary action, including
preparing and executing instruments of transfer and assumption, and
amendments to affected plans, to carry out the provisions of this
Section 2.3.
2.4 TRANSFERS. The share transfer books of Joslyn with respect to its
common shares shall be closed at the Effective Time, and the shareholders of
record of its common shares as of that time shall be the shareholders entitled
to exchange of their Joslyn Common Shares for Holding Common Shares as herein
provided. Except as hereinafter provided, no transfer of any Joslyn Common
Shares will be recorded in the share transfer books of Joslyn after the
Effective time. In the event of a transfer of ownership of any Joslyn Common
Shares that is not reflected in the share transfer records of Joslyn as of the
Effective Time, certificates representing Holding Common Shares may be issued
to a transferee if the certificate representing such Joslyn Common Shares is
accompanied by all documents required to evidence and effect such transfer and
the payment of any applicable stock transfer taxes.
ARTICLE III
COVENANTS AND AGREEMENTS OF HOLDING
Holding hereby covenants to Joslyn as follows:
3.1 LISTING OF HOLDING COMMON SHARES. Holding shall use its best
efforts to effect, at or before the Effective Time, authorization for listing
of the Holding Common Shares issuable in connection with the Plan of Exchange
on the National Association of Securities Dealers Automatic Quotation
("NASDAQ") National Market System.
3.2 1933 ACT OF REGISTRATION. Holding shallfile with the Securities and
Exchange Commission (the "SEC") a registration statement on Form S-4 in order
to register its Common Shares (and the Common Share Purchase Rights attached
thereto) under the Securities Act of 1933.
Page 16 4
<PAGE>
3.3 1934 ACT REGISTRATION. Holding shall file with the SEC a
registration statement and shall use its best efforts to secure early
effectiveness thereof in order to register its Common Shares (and the Common
Share Purchase Rights attached thereto) under Section 12 of the 1934 Act.
3.4 ISSUANCE OF HOLDING SHARES UNDER JOSLYN PLANS. Holding shall take
all corporate action necessary for it to issue Holding Common shares issuable
pursuant to the plans referred to in Section 2.3 hereof.
ARTICLE IV
CONDITIONS TO CONSUMMATION OF THE EXCHANGE
The obligations of each of the parties to this Agreement to cause the
transactions contemplated herein to be consummated shall be, at such party's
option, subject to the satisfaction of the following conditions at or before
the Effective Time, except as any such conditionse may be waived in writing
by such party in accordance with Section 6.5 of this Agreement.
4.1 COVENANTS. The other party shall have substantially performed or
complied with all covenants, agreements and conditions to be performed or
complied with by it prior to the Effective Time.
4.2 SHAREHOLDER APPROVAL. The Plan of Exchange shall have been adopted
and approved by the shareholders of Joslyn and by the sole shareholder of
Holding in accordance with the BCA and their respective Articles of
Incorporation and By-Laws.
4.3 LITIGATION. At the Effective Time, there shall not be in effect any
order restraining, enjoining or prohibiting the consummation of the transaction
contemplated by this Agreement.
4.4 TAX RULINGS. The parties shall received a satisfactory ruling from
the Internal Revenue Service or a satisfactory opinion of counsel to the effect
that, as of the Effective Time of the Exchange.
(a) No gain or loss will be recognized by the holders of Joslyn
Common Shares upon the exchange of Joslyn Common Shares for an equal
number of Holding Common Shares;
(b) The basis of each Holding Common Share received by each holder
of Joslyn Common Shares will be equal to the basis of the Joslyn Common
Share exchanged for such Holding Common Share in the Exchange;
(c) The holding period of each Holding Common Share received by each
holder of Joslyn Common Shares will include the holding period of the
Page 17 5
<PAGE>
Joslyn Common Share exchanged for such Holding Common Share, provided that
the Joslyn Common share is held by the Joslyn Shareholder as a capital
asset;
(d) No gain or loss will be recognized by Holding upon the receipt
of Joslyn Common Shares in exchange for an equal number of Holding Common
Shares;
(e) The basis of each Joslyn Common Share received by Holding will
be equal to the basis of those shares in the hands of the person who held
such Joslyn Common shares immediately before the Exchange;
(f) The holding period for Holding of the Joslyn Common Shares will
include the period during which the Joslyn Common Shares were held by the
person who held such Joslyn Common Shares on the Effective Date of the
Exchange; and
(g) The payments received by Joslyn Shareholders who exercise their
dissenters' rights will be treated as full payment in exchange for their
Joslyn Common Shares.
4.5 LISTING OF HOLDING COMMON SHARES. Holding Common Shares issuable in
connection with the Plan of Exchange shall have been approved for listing on
the NASDAQ National Market System.
4.6 HOLDING REGISTRATION STATEMENT. The Holding Registration Statement
on Form S-4 relating to the Holding Common Shares (and the Common Share
Purchase Rights attached thereto) to be issued in connection with the Exchange
shall have become effective and there shall be no federal or state stop orders
pending with respect to such Registration Statement.
ARTICLE V
TERMINATION AND EFFECT OF TERMINATION
5.1 TERMINATION OF AGREEMENT. This Agreement may be terminated by the
Board of Directors of Joslyn at any time prior to the Effective Time, whether
before or after the meeting of the shareholders referred to in Section 4.2
above, and such termination shall be effective upon the receipt of written
notice thereof by Holding.
5.2 EFFECT OF TERMINATION. In the event that this Agreement shall be
terminated pursuant to Section 5.1 hereof, all further obligations of the
parties under this Agreement shall terminate without further liability except
for the obligations of the parties under Section 6.2 hereof.
Page 18 6
<PAGE>
ARTICLE VI
MISCELLANEOUS
6.1 NON-SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties contained in Article III of this Agreement shall expire on, and
be terminated and extinguished at, the Effective Time or upon termination of
this Agreement.
6.2 EXPENSES. All legal and other costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby,
regardless of whether the Exchange is consummated, shall be borne by Joslyn.
6.3 NOTICES. Any notice or other communications required or permitted
hereunder shall be sufficiently given if delivered personally or sent by a
nationally-recognized courier service, all charges or postage prepaid, return
receipt requested, addressed as follows:
To Holding:
Joslyn Holding Company
30 South Wacker Drive
Chicago, Illinois 60606
Attention: Wayne M. Koprowski
To Joslyn:
Joslyn Corporation
30 South Wacker Drive
Chicago, Illinois 60606
Attention: Wayne M. Koprowski
or such other address that shall be furnished in writing by either party, and
any such notice or communication shall be deemed to have been given on the
earlier of the date of receipt thereof or the second business day after
mailing.
6.4 BINDING EFFECT AND ASSIGNMENT. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective
successors and assigns, provided that this Agreement may not be assigned by
either party without the consent of the other party.
6.5 WAIVER AND AMENDMENT. Either party may, at any time prior to the
Effective Time, waive any of the terms or conditions of this Agreement that
operate in favor of such party, including any conditions to consummation of the
Exchange set forth in Article IV or (subject to the need to secure shareholder
approval) agree to an amendment of this Agreement;
Page 19 7
<PAGE>
provided, however, that after a vote by the shareholders of a party hereto, any
such waiver or amendment shall be agreed to by that party only if, in the
opinion of its directors, such waiver or amendment will not have any materially
adverse effect on the rights of shareholders of such party as provided in this
Agreement or, if such waiver or amendment would have such a materially adverse
effect, then such waiver or amendment shall occur only if the affected
shareholder shall again approve the Plan of Exchange.
6.6 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement,
and supercedes all previous oral and written representations and agreements,
between the parties hereto with respect to the subject matter hereof.
6.7 LIMITATION ON RIGHTS. Except as otherwise specifically provided
herein, nothing expressed or implied in this Agreement is intended or shall be
construed to confer upon or give any person, firm or corporation any rights or
remedies under or by reason of this Agreement or any transaction contemplated
hereby.
6.8 CAPTIONS. The captions in this Agreement are for convenience only
and shall not be considered a part of or affect the construction or
interpretation of any provision of this Agreement.
6.9 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois.
6.10 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be an original and all of which shall be
considered one and the same agreement and shall become effective when one or
more counterparts have been signed by each of the parties and delivered to the
other party.
IN WITNESS WHEREOF, the parties to this Agreement, pursuant to the
approval and authority duly given by resolutions adopted by their respective
board of directors, have each caused this Agreement to be executed by its
President.
ATTEST: JOSLYN HOLDING COMPANY
/s/ Susan D. Hartwig By: /s/ William J. Rotenberry
___________________________ ___________________________
Susan D. Hartwig, Secretary William J. Rotenberry, President
ATTEST: JOSLYN CORPORATION
/s/ Wayne M. Koprowski By: /s/ Richard A. Kruk
__________________________ ______________________________
Wayne M. Koprowski, Secretary Richard a. Kruk, President
Page 20 8
<PAGE>
7. (Complete this item if reporting a merger of subsidiary corporations).
a. The number of outstanding shares of each class of each merging
subsidiary corportion and the number of such shares of each class
owned immeditely prior to the adoption of the plan of merger by the
parent corporation, are:
Number of Shares of Each
Total Number of Class Owned Immediately
Name of Shares Outstanding Prior to Merger by the
Corporation of Each Class Parent Corporation
__________________ _________________ ___________________
__________________ _________________ ___________________
__________________ _________________ ___________________
b. The date of mailing a copy of the plan of merger and notice of the
right to dissent to the shareholders of each merging subsidiary
corporation was _____________________, 19_____.
Was written consent for the merger or written waiver of the 30 day
period by the holders of all the outstanding shares of all subsidiary
corporations received? ____ ____
/___/ Yes /___/ No
(If the answer is "No", the duplicate copies of the Articles of Merger
may not be delivered to the Secretary of State until after 30 days
following the mailing of a copy of the plan of merger and of the notice
of the right to dissent to the shareholders of each merging subsidiary
corporation).
The undersigned corporations have caused these articles to be signed by
their duly authorized officers, each of whom affirm, under penalties of
perjury, that the facts stated herein are true.
Dated April 27, 1988 JOSLYN HOLDING COMPANY
____________________________________
(Exact Name of Corporation)
Attested by:
/s/ Wayne M. Koprowski By: /s/ Richard A. Kruk
__________________________ ______________________________
Wayne M. Koprowski, Secretary Richard A. Kruk, President
Dated April 27, 1988 JOSLYN CORPORATION
Attested by:
/s/ Wayne M. Koprowski By: /s/ Richard A. Kruk
___________________________ _____________________________
Wayne M. Koprowski, Secretary Richard A. Kruk, President
Page 21 9
<PAGE>
File Number 5495 085 3
STATE OF ILLINOIS
OFFICE OF THE SECRETARY OF STATE
WHEREAS, ARTICLES OF AMENDMENT TO THE ARTICLES OF INCORPORATION OF
JOSLYN HOLDING COMPANY
INCORPORATED UNDER THE LAWS OF THE STATE OF ILLINOIS HAVE BEEN FILED IN THE
OFFICE OF THE SECRETARY OF STATE AS PROVIDED BY THE BUSINESS CORPORATION ACT
OF ILLINOIS, IN FORCE JULY 1, A.D. 1984.
NOW THEREFORE, I, JIM EDGAR, SECRETARY OF STATE OF THE STATE OF ILLINOIS, BY
VIRTUE OF THE POWERS VESTED IN ME BY LAW, DO HEREBY ISSUED THIS CERTIFICATE AND
ATTACH HERETO A COPY OF THE APPLICATION OF THE AFORESAID CORPORATION.
IN TESTIMONY WHEREOF, thereto set my hand and cause to be affixed the Great
Seal of the State of Illinois, at the City of Springfield, this 28th day of
April A.D. 1988 and of the Independence of the United States the two hundred
and 12th.
SEAL /s/ JIM EDGAR
________________________________
Secretary of State
Page 22
<PAGE>
JIM EDGAR
Secretary of State
State of Illinois
ARTICLES OF AMENDMENT
Pursuant to the provisions of the "The Business Corporation Act of 1983", the
undersigned corporation hereby adopts these Articles of Amendment to its
Articles of Incorporation.
ARTICLE ONE The name of the corporation is JOSLYN HOLDING COMPANY
ARTICLE TWO The following amendment of the Articles of Incorporation was
adopted on April 27, 1988 in the manner indicated below ("X"
one box only)
By a majority of the incorporations, provided no directors were
____ named in the articles of incorporation and no directors have
/___/ been elected; or by a majority of the board of directors, in
accordance with Section 10.10, the corporation having issued
no shares as of the time of adoption of this amendment.
____ By a majority of the board of directors, in accordance with
/___/ Section 10.15 shares having been issued but shareholder action
not being required for the adoption of the amendment.
By the shareholders, in accordance with Section 10.20, a
____ resolution of the board of directors having been duly adopted
/ X / and submitted to the shareholders. At a meeting of the
/___/ shareholders, not less than the minimum number of votes
required by statute and by the articles of incorporation were
voted in favor of the amendment.
By the shareholders, in accordance with Section 10.20 and 7.10,
a resolution of the board of directors having been duly adopted
____ and submitted to the shareholders. A consent in writing has
/___/ been signed by shareholders having not less than the minimum
number of votes required by statute and by the articles of
incorporation. Shareholders who have not consented in writing
have been given notice in accordance with Section 7.10.
By the shareholders, in accordance with Section 10.20 and 7.10,
____ a resolution of the board of directors have been duly adopted
/___/ and submitted to the shareholders. A consent in writing has
been signed by all the shareholders entitled to vote on this
amendment.
(INSERT AMENDMENT)
(Any article being amended is required to be set forth in its entirety).
(Suggested language for an amendment to change the corporate name is: RESOLVED,
that the Articles of Incorporation be amended as follows:)
RESOLVED, that ARTICLE ONE OF THE ARTICLES OF INCORPORATION BE AMENDED
IN ITS ENTIRELY TO READ AS FOLLOWS: ARTICLE ONE: THE NAME OF THE CORPORATION
IS JOSLYN CORPORATION.
_______________________________________________________________________________
(NEW NAME)
Page 23 2
<PAGE>
ARTICLE THREE The manner in which any exchange, reclassification or
cancellation of issued shares, or a reduction of the number
of authorized shares of any class below the number of issued
shares of that class, provided for or effected by this
amendment, is as follows: (if not applicable, insert "No
change")
No change
ARTICLE FOUR (a) The manner in which said amendment effects a change in the
amount of paid-in capital* is as follows. (If not applicable,
insert "No change")
No change
(b) The amount of paid-in capital* as changed by this
amendment is as follows: (if not applicable, insert
"No change")
No change
Before Amendment After Amendment
Paid-in Capital $______________ $______________
The undersigned corporation has caused these articles to be signed by its
duly authorized officers, each of whom affirm, under penalties of perjury,
that the facts stated herein are true.
Dated April 27, 1988 Joslyn Holding Company
Attested by: /s/ Wayne M. Koprowski By: /s/ Richard A. Kruk
______________________ _________________________
Wayne M. Koprowski Richard A. Kruk
Secretary President
*"Paid-in Capital" replaces the terms Stated Capital & Paid-in Surplus and is
equal to the total of these accounts.
Page 24 3
<PAGE>
File Number 5495 085 3
STATE OF ILLINOIS
OFFICE OF THE SECRETARY OF STATE
WHEREAS, ARTICLES OF AMENDMENT TO THE ARTICLES OF INCORPORATION OF
JOSLYN CORPORATION
INCORPORATED UNDER THE LAWS OF THE STATE OF ILLINOIS HAVE BEEN FILED IN THE
OFFICE OF THE SECRETARY OF STATE AS PROVIDED BY THE BUSINESS CORPORATION ACT
OF ILLINOIS, IN FORCE JULY 1, A.D. 1984.
NOW THEREFORE, I, JIM EDGAR, SECRETARY OF STATE OF THE STATE OF ILLINOIS, BY
VIRTUE OF THE POWERS VESTED IN ME BY LAW, DO HEREBY ISSUED THIS CERTIFICATE
AND ATTACH HERETO A COPY OF THE APPLICATION OF THE AFORESAID CORPORATION.
IN TESTIMONY WHEREOF, thereto set my hand and cause to be affixed the Great
Seal of the State of Illinois, at the City of Springfield, this 23rd day of
June A.D. 1994 and of the Independence of the United States the two hundred
and 18th.
SEAL /s/ GEORGE H. RYAN
________________________________
Secretary of State
Page 25
<PAGE>
ARTICLES OF AMENDMENT
CORPORATE NAME: JOSLYN CORPORATION
__________________
MANNER OF ADOPTION OF AMENDMENT:
The following amendment of the Articles of Incorporation was adopted on
April 27, 1994 in the manner indicated below. ("X" one box only)
By a majority of the incorporations, provided no directors were
____ named in the articles of incorporation and no directors have
/___/ been elected; or by a majority of the board of directors, in
accordance with Section 10.10, the corporation having issued
no shares as of the time of adoption of this amendment.
____ By a majority of the board of directors, in accordance with
/___/ Section 10.15 shares having been issued but shareholder action
not being required for the adoption of the amendment.
By the shareholders, in accordance with Section 10.20, a
____ resolution of the board of directors having been duly adopted
/ X / and submitted to the shareholders. At a meeting of the
/___/ shareholders, not less than the minimum number of votes
required by statute and by the articles of incorporation were
voted in favor of the amendment.
By the shareholders, in accordance with Section 10.20 and 7.10,
a resolution of the board of directors having been duly adopted
____ and submitted to the shareholders. A consent in writing has
/___/ been signed by shareholders having not less than the minimum
number of votes required by statute and by the articles of
incorporation. Shareholders who have not consented in writing
have been given notice in accordance with Section 7.10.
By the shareholders, in accordance with Section 10.20 and 7.10,
____ a resolution of the board of directors have been duly adopted
/___/ and submitted to the shareholders. A consent in writing has
been signed by all the shareholders entitled to vote on this
amendment.
TEXT OF AMENDMENT:
a. When amendment effects a name change, insert the new corporate name below.
Use Page 2 for all other amendments.
Article I. The name of the corporation is:
____________________________________________________________________________
(NEW NAME)
Page 26
<PAGE>
b. (If amendment affects the corporate purpose, the amended purpose is
required to be set forth in its entirety. If there is not sufficient
space to do so, add one or more sheets of this size).
9. AMENDMENT TO LIMIT THE LIABILITY OF THE DIRECTORS
Mr. Hamister stated that the final item on the agenda is the
consideration of a proposal to amend the Corporation's Directors in
certain breaches of fiduciary duty.
Upon motion duly made and seconded, the following resolution was
adopted:
RESOLVED, that the Shareholders of Joslyn Corporation
("Corporation") ratify and approve the proposal to amend the
Corporation's Articles of Incorporation, as described in the
Proxy Statement, to limit the personal liability of the
Corporation's Directors as follows:
"The Directors of the Corporation shall not be liable to the
Corporation or to its shareholders for monetary damages for breach
of fiduciary duties as a Director, provided that this provision
shall not eliminate or limit the liability of a Director (i) for
any breach of the Director's duty of loyalty to the Corporation of
its shareholders, (ii) for acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of the
law, (iii) under Section 8.65 of the Illinois Business Corporation
Act or (iv) for any transaction from which the Director derived an
improper personal benefit.
Following the tally of votes, the Secretary announced that the votes
cast in favor of the motion and ratification to amend the Corporation's
Articles of Incorporation to limit the personal liability of Directors
represented 78.3% of the shares outstanding entitled to vote. The proposal to
amend the Articles of Incorporation was approved.
The Chairman directed the Secretary to attach the Certificate of the
Inspectors of Election on Proposals 1, 2 and 3 to the minutes of the Annual
Meeting of Shareholders, which is attached hereto and made a part hereof as
Exhibit IV.
Page 27
<PAGE>
The manner, if not set forth in Article 3b, in which any exchange,
reclassification or cancellation of issued shares, or a reduction of the
number of authorized shares of any class below the number of issued shares
of that class, provided for or effected by this amendment, is as follows:
(a) The manner, if not set forth in Article 3b, in which said amendment
effects a change in the amount of paid-in capital (Paid-in capital
replaces the terms Stated Capital and Paid-in Surplus and is equal to
the total of these accounts) is as follows:
(b) The amount of paid-in capital (Paid-in Capital replaces the terms Stated
Capital and Paid-in Surplus and is equal to the total of these accounts)
as changed by this amendment is as follows:
Before Amendment After Amendment
Paid-in Capital $______________ $______________
The undersigned corporation has caused this statement to be signed by its
duly authorized officers, each of whom affirms, under penalties of perjury,
that the facts stated herein are true.
Dated June 7, 1994 Joslyn Corporation
Attested by: /s/ William J. Rotenberry By: /s/ Wayne M. Koprowski
______________________ _________________________
William J. Rotenberry Wayne M. Koprowski
Asst. Secretary Vice President & Secretary
7. If amendment is authorized pursuant to Section 10.10 by the incorporators,
the incorporators must sign below.
OR
If amendment is authorized by the directors pursuant to Section 10.10 and
there are no officers, then a majority of the directors or such directors
as may be designated by the board, must sign below.
The undersigned affirms, under the penalties of perjury, that the facts
stated hereinare true.
Dated __________________________________19__
JOSLYN CORPORATION
EXECUTIVE MANAGEMENT INCENTIVE PLAN
15 May 1979
Last Revised Effective 16 September 1994
A. GENERAL PRINCIPLES
1. Joslyn Corporation (the Company) believes that executive compensation,
especially when reflected in annual bonuses or incentive payments,
should relate directly to each executive's achievement of the specific
goals and plans which have been entrusted to that executive's
leadership.
2. Effective planning is an incentive to act at the corporate level, at
the unit level, and at the individual level. This incentive to act
should be reflected in the incentive to earn where a position
warrants a significant role in developing annual operating plans and
directing their implementation.
3. In support of these principles, all prior Company bonus plans are
discontinued with respect to those executive positions enumerated in
this document, and are replaced by the Executive Management Incentive
Plan (the Plan) as described on the following pages.
B. EXECUTIVE MANAGEMENT INCENTIVE PLAN PURPOSE
Except for a small portion of the total potential award which is subject
to a discretionary determination, the Plan will reward participants in
direct relationship to their performance against specified individual
objectives and/or for their performance as a member of the Corporate or
Business Unit Management team. It is designed to incorporate these key
features:
1. Incentive performance factors based on individual and Business Unit
performance as well as total Company results.
2. Weighting of performance factors to reflect each participant's primary
job assignment and annual priorities.
Page 29
<PAGE>
3. Maximum flexibility from year to year and from participant to
participant in the establishment and weighting of incentive goals.
4. A large measure of individual incentive value by providing a written
communication to each participant at the beginning of each fiscal year
specifying the performance factors in his or her plan, the weighting
of each performance factor, the basis for measuring each performance
factor, and the incentive award which may be earned on each
performance factor at different levels of performance.
5. Quantitative performance measurement for purposes of determining
incentive awards where possible.
6. Discretionary and subjective performance measurement when quantitative
measurement is not possible.
C. Incentive Opportunity Level
1. The Plan provides each participant with the opportunity to earn a
total award of up to twenty to seventy percent (20% to 70%) of his or
her annual base salary as of the beginning of the fiscal year to
which the award applies to the following:
Effective 1994
Type of Participant Maximum Award as Percent
of Base Salary
at Start of Year
Class I 70%
Class II 60%
Class III 40%
Class IV 30%
Class V 20%
Page 30
<PAGE>
2. Potential earnings from each performance factor is determined by the
factor's weighting in the total plan design, which will vary by
individual.
3. Each performance factor will be qualitatively judged as follows:
Where % of Planned Accomplishment is:
Under 85% 85% 100% 115%
of Plan of Plan of Plan of Plan
Performance is Unsatis- At At At
considered factory Threshold Plan Maximum
Approximate
odds of
Attainment N/A 8:10 5:10 2:10
are:
Total potential
payout is: 1994 and Later
Class I 0 11 2/3% 35% 70%
Class II 0 10% 30% 60%
Class III 0 6 2/3% 20% 40%
Class IV 0 5% 15% 30%
Class V 0 3 1/3% 10% 20%
Page 31
<PAGE>
Illustrate Example
Type of Participant Class IV
Factors Corporate, Business Unit and Individual (one each)
____________________________________________________________________________
% of Annual Salary Earned
Performance Goal
Level Weight Corporate Business Unit Individual Total Award
Achieved Factor .4 .5 .1 1.0
Unsatisfactory 0% 0% 0% 0%
Threshold 2.0% 2.5% .5% 5%
Plan 6.0% 7.5% 1.5% 15%
Maximum 12% 15% 3.0% 30%
____________________________________________________________________________
4. No awards will be made for performance below threshold on any single
performance factor, but such performance level on one factor will not affect
the opportunity for any other factor.
5. No awards will be made for any fiscal year during which the total
regular dividends payable per share of common stock were less than $.53.
D. Selection and Weighting of Performance Factors
1. Performance factors for each participant will be selected and weighted
individually to represent those Corporate, Business Unit and
Individual measurements which are:
a. Most appropriate to the overall design and impact of his or her
total position on a continuing basis; and
b. Most significant to the specific objectives and opportunities of
his or her position in the light of current (fiscal year)
expectations for the Business Unit or Staff Unit he or she
manages; and
Page 32
<PAGE>
c. Most responsive to decisions and leadership which can be exercised
by the participant.
2. Each incentive plan participant will have an individually tailored set
of goals and opportunities that may or may not include one or more
goals in each of the following categories:
a. Corporate performance
b. Business Unit or Staff Unit performance
c. Individual performance
3. Each fiscal year management shall establish the mix and weighting of
each participant's goals under the Plan, and specific goals for
Corporate, Business Unit or Staff Unit performance.
4. Commencing with Fiscal Year 1980, Individual, Business Unit and Staff
Unit goals shall be established, as appropriate, by each participant
and the Chief Executive Officer of the Company, or, if applicable in
the future, with an intermediate level of direct supervision with
approval of the Chief Executive Officer; in accordance with procedures
established from time to time by the Company. For Fiscal Year 1979,
such goals shall be established by the Chief Executive Officer, where
appropriate, with no input from individual participants.
5. The total incentive plan for each participant shall then be submitted
to the Compensation Committee of the Board of Directors for approval
on or about the beginning of each fiscal year, or as soon thereafter
as practical.
6. The approved individual participant plan shall then be communicated,
in writing, to each participant.
E. Administration of the Plan
1. The Plan shall be administered by the Compensation Committee of the
Board of Directors (the Committee). The Committee shall have full and
complete power to administer the Plan and interpret the provisions
thereof, and its decisions shall be final and binding on all
participants. The Committee's powers include, but are not limited to,
the right to:
Page 33
<PAGE>
a. Determine who shall and shall not participate in the Plan; and
b. Determine the weighting and mix of all goals for any participant;
and
c. Review and approve all Corporate, Business Unit and Staff Unit
goals recommended by management, including a definition of such
terms as "profit"; and
d. Amend or terminate the Plan at any time.
2. As soon as feasible after May 15, 1979, the Committee shall be so
constituted that no member of the Committee shall be a participant in
the Plan.
3. The Committee shall meet at times and places of the Committee's own
choosing, and, providing at least a majority of Committee members are
present at any meeting, the decision of such majority shall be
sufficient to take any action with respect to the Plan. Action may
also be taken in writing if approved by a majority of the full
Committee.
4. In administering the Plan, the Committee shall at all times be guided
by the best interests of the Company and its shareholders, but shall
rely heavily on the recommendations of management with respect to
the appropriateness of the mix and weighting of individual incentive
factors. Similarly, management is specifically empowered to add a
participant to the Plan during the course of any fiscal year without
the prior approval of the Committee provided that:
a. Such new participant is an employee hired or promoted into an
executive position which is incontroversially of a magnitude equal
to those positions included for Plan participation as of the date
this Plan was first approved; and
b. If the inclusion of such new prticipant is submitted to the
Committee for ratification at the next regularly scheduled meeting
of the Committee.
F. Eligibility
1. It is the intent of the Plan that eligibility shall be limited to key
executives who can significantly effect the performance of the
Company. Participants shall be those key executives recommended for
participation by management and approved or ratified by the Committee.
Page 34
<PAGE>
2. In the event a Plan participant shall die, retire under the Company's
retirement program, become totally disabled, or be demoted to a
position to which Plan participation does not apply, a pro rata award
shall be payable to, or on behalf of such participant at such time as
other awards are payable for the fiscal year in which such event
occurs.
3. For Plan goals which are subject to quantitative or numeric
measurement such proration shall be on the basis of appropriate
fiscal year-end results multiplied by the ratio of days of active
employment in a participating position during such fiscal year to 365.
For other goals not amenable to numeric proration, management shall
recommend appropriate and equitable incentive awards for Committee
approval.
4. The proration described above shall also apply to (1) an executive who
first becomes a participant after the start of a fiscal year, or (2) a
participant who is transferred from one participating position to
another, and (3) for whom modified incentive goals are established.
Any such modified awards shall have a dollar opportunity related
to the participant's base salary in effect at the time such goals are
modified rather than the basic salary in effect at the beginning of
the fiscal year.
5. If a participant shall be discharged for cause, no incentive award of
any kind shall be payable for the fiscal year in which such discharge
occurs. Any awards earned for the prior fiscal year but not yet
payable shall, however, be payable without regard to such discharge.
6. Should a participant be discharged for reasons other than cause, or
voluntarily terminate his or her employment with the Company, the
payment of an incentive award shall be at the discretion of management
as approved by the Committee, but no such payment, if any, shall be
greater than the pro rata award payable if the participant had died
on the date of discharge.
G. Adjustment of Goals During a Fiscal Year
1. It is the intent of the Plan that goals established for the Plan and
each of its participants shall remain unchanged for the fiscal
year once approved by the Committee and communicated to the
participant.
2. In the event of unforeseen windfalls or other changes beyond the
control of the participant or beyond the ability of management or
the Committee to foresee, management shall recommend appropriate
adjustments to established goals for Committee approval and such
adjusted and approved goals shall be communicated to each affected
Page 35
<PAGE>
participant. Alternatively in such circumstances, incentive awards
may be determined on a pro rata basis as of the date the original
goals are deemed inappropriate, and adjusted goals established for
the balance of the fiscal year with pro rata incentive opportunities,
if recommended by management and approved by the Committee. The
payment of such two-part awards shall not be made until the end of
the fiscal year.
H. Payment of Awards
1. All incentive awards shall be payable in cash on or about March 1st
or as soon as practical thereafter, but in no event later than
March 31st. Deferral of awards shall not be permitted.
2. The dollar amount of each award shall be determined by management as
soon as practical after the end of the fiscal year by measuring the
participant's performance against the Plan goals established for such
participant and applying subjective judgement to those areas requiring
such determination in accordance with procedures established from
time to time by the Company.
3. The total amount of each award and all awards in total shall be
communicated to and approved by the Committee prior to the issue of
payments to or on behalf of the participants.
I. Funding for Plan Payments
The Company shall establish appropriate funding reserves, accounts or other
mechanisms to recognize the liability for potential Plan awards in
accordance with accepted accounting principles.
J. Change in Control
In the event of a "Change in Control" (as defined hereinafter) occurs, and
if this Plan is reduced or terminated in its entirety or for any covered
executive or executives in the calendar year in which the Change in
Control occurs, such covered executive or executives shall be entitled to
a proportional award payment as follows:
Award Payment at 100% Plan Accomplishment level (one-half maximum
potential award) times a fraction for the calendar year with a
denominator equal to the number of months (including any partial
Page 36
<PAGE>
month as a whole month) prior to such reduction or termination and a
denominator equal to twelve.
Once a Change in Control occurs, the Plan cannot be amended or modified to
remove, alter or cancel the provisions of this section in any way.
As used in this Plan, Change in Control means:
1. The acquisition by any individual, entity or group (a "Person"),
including any "person" within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of beneficial ownership within the meaning of
Rule 13d-3 promulgated under the Exchange Act, of 25% or more of
either (i) the then outstanding common shares of the Company
(the "Outstanding Company Common Shares") or (ii) the combined
voting power of the then outstanding securities of the Company
entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); provided, however, that
the following acquisitions shall not constitute a Change in
Control: (A) any acquisition directly from the Company (excluding
any acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or
exchangeable securities), (B) any acquisition by the Company,
(C) any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled
by the Company, or (D) any acquisition by any corporation pursuant
to a reorganization, merger or consolidation involving the Company,
if, immediately after such reorganization, merger or consolidation,
each of the conditions described in clauses (i), (ii) and (iii) of
subsection (3) of this definition shall be satisfied; and provided
further that, for purposes of clause (B), if any Person (other than
the Company or any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the
Company) shall become the beneficial owner of 25% or more of the
Outstanding Company Common Shares or 25% or more of the Outstanding
Company Voting Securities by reason of an acquisition by the Company
and such Person shall, after such acquisition by the Company, become
the beneficial owner of any additional shares of the Outstanding
Company Common Shares or any additional Outstanding Voting Securities
and such beneficial ownership is publicly announced, such additional
beneficial ownership shall constitute a Change in Control;
2. Individuals who, as of the date of adoption of this Plan, constitute
the Board of Directors of the Company (the "Incumbent Board") cease
for any reason to constitute at least a majority of such Board of
Directors of the Company (the "Board"); provided, however, that any
individual who becomes a director of the Company subsequent to the
date hereof whose election, or nomination for election by the
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<PAGE>
Company's shareholders, was approved by the vote of at least a
majority of the directors then comprising the Incumbent Board shall
be deemed to have been a member of the Incumbent Board; and provided
further, that no individual who was initially elected as a director
of the Company as a result of an actual or threatened election
contest, as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act, or any other actual or threatened
solicitation of proxies or consents by or on behalf of any Person
other than the Board shall be deemed to have been a member of the
Incumbent Board;
3. Approval by the shareholders of the Company of a reorganization,
merger or consolidation unless, in any such case, immediately after
such reorganization, merger or consolidation, (i) more than 60% of
the then outstanding shares of common stock of the corporation
resulting from such reorganization, merger or consolidation and more
than 60% of the combined voting power of the then outstanding
securities of such corporation entitled to vote generally in the
election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals or
entities who were the beneficial owners, respectively, of the
Outstanding Company Common Shares and the Outstanding Company Voting
Securities immediately prior to such reorganization, merger or
consolidation and in substantially the same proportions relative to
each other as their ownership, immediately prior to such
reorganization, merger or consolidation, of the Outstanding Company
Common Shares and the Outstanding Company Voting Securities, as the
case may be, (ii) no Person (other than the Company, any employee
benefit plan (or related trust) sponsored or maintained by the
Company or the corporation resulting from such reorganization,
merger or consolidation (or any corporation controlled by the
Company) and any Person which beneficially owned, immediately prior
to such reorganization, merger or consolidation, directly or
indirectly, 25% or more of the Outstanding Company Common Shares or
the Outstanding Company Voting Securities, as the case may be
beneficially owns, directly or indirectly, 25% or more of the then
outstanding shares of common stock of such corporation or 25% or more
of the combined voting power of the then outstanding securities of
such corporation entitled to vote generally in the election of
directors and (iii) at least a majority of the members of the board
of directors of the corporation resulting from such reorganization,
merger or consolidation were members of the Incumbent Board at the
time of the execution of the initial agreement or action of the Board
providing for such reorganization, merger or consolidation; or
4. Approval by the shareholders of the Company of (i) a plan of complete
liquidation or dissolution of the Company or (ii) the sale or other
disposition of all or substantially all of the assets of the Company
other than to a corporation with respect to which, immediately after
such sale or other disposition, (A) more than 60% of the then
outstanding shares of common stock thereof and more than 60% of the
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<PAGE>
combined voting power of the then outstanding securities thereof
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially
all of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Shares and the
Outstanding Company Voting Securities immediately prior to such sale
or other disposition and in substantially the same proportions
relative to each other as their ownership, immediately prior to such
sale or other disposition, of the Outstanding Company Common Shares
and the Outstanding Company Voting Securities, as the case may be,
(B) no Person (other than the Company, any employee benefit plan
(or related trust) sponsored or maintained by the Company or such
corporation (or any corporation controlled by the Company) and any
Person which beneficially owned, immediately prior to such sale or
other disposition, directly or indirectly, 25% or more of the
Outstanding Company Common Shares or the Outstanding Company Voting
Securities, as the case may be) beneficially owns, directly or
indirectly, 25% or more of the then outstanding shares of common
stock thereof or 25% or more of the combined voting power of the
then outstanding securities thereof entitled to vote generally in
the election of directors and (C) at least a majority of the members
of the board of directors thereof were members of the Incumbent Board
at the time of the execution of the initial agreement or action of the
Board providing for such sale or other disposition.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<FISCAL-YEAR-END> Dec-31-1995
<PERIOD-START> Jan-01-1995
<PERIOD-END> Mar-31-1995
<PERIOD-TYPE> 3-MOS
<CASH> 35,880
<SECURITIES> 0
<RECEIVABLES> 32,323
<ALLOWANCES> 0
<INVENTORY> 37,677
<CURRENT-ASSETS> 119,593
<PP&E> 84,068
<DEPRECIATION> 46,308
<TOTAL-ASSETS> 177,964
<CURRENT-LIABILITIES> 42,382
<BONDS> 0
0
0
<COMMON> 8,953
<OTHER-SE> 73,292
<TOTAL-LIABILITY-AND-EQUITY> 177,964
<SALES> 56,523
<TOTAL-REVENUES> 56,523
<CGS> 42,360
<TOTAL-COSTS> 42,360
<OTHER-EXPENSES> 94
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 5,344
<INCOME-TAX> 1,850
<INCOME-CONTINUING> 3,494
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,494
<EPS-PRIMARY> 0.49
<EPS-DILUTED> 0.49
</TABLE>
