Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13
or 15(d) of the Securities Exchange Act of 1934
For Quarter Ended: March 31, 1994-Commission File Number 1-5558
Katy Industries, Inc.
(Exact name of registrant as specified in its charter)
Delaware 75-1277589
(State of Incorporation) (I.R.S. Employer Identification No.)
853 Dundee Avenue, Elgin, Illinois 60120
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (312)379-1121
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 No X
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.
Class Outstanding at March 31, 1994
Common stock, $1 par value 9,017,387
KATY INDUSTRIES, INC.
FORM 10-Q
MARCH 31, 1994
INDEX
Page No.
PART I FINANCIAL INFORMATION
Condensed Consolidated Balance Sheets
March 31, 1994 and December 31, 1993 2
Statements of Condensed Consolidated
Operations Three months ended
March 31, 1994 and 1993 4
Statements of Condensed
Consolidated Cash Flows
Three months ended
March 31, 1994 and 1993 5
Notes to Condensed Consolidated
Financial Information 6
Management's Discussion and
Analysis of Financial Condition
and Results of Operations 10
PART II OTHER INFORMATION
Item 1 Legal Proceedings 15
Item 5 Other Information 15
Item 6 Exhibits and
Reports on Form 8-K 16
Signatures 17
KATY INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 1994 AND DECEMBER 31, 1993
<TABLE>
<CAPTION>
March 31, December 31,
1994 1993
(Thousands of Dollars)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $122,912 $130,289
Marketable securities - available for sale
(1993 at cost; market - $31,223) - Note 1 28,294 15,795
Accounts receivable, trade, net of allowance
for doubtful accounts of $5,809 and $7,975 23,673 20,568
Notes and other receivables, net of allowance
for doubtful notes of $10 4,809 3,804
Inventories - Note 1 40,391 40,725
Other current assets 10,426 14,165
Total current assets 230,505 225,346
OTHER ASSETS:
Investments, at equity, and advances to
unconsolidated subsidiaries - Note 2 40,314 45,516
Investments, at cost - Note 3 425 6,704
Notes receivable, net of allowance for
doubtful notes of $1,700 3,027 3,058
Miscellaneous 19,577 19,915
Total other assets 63,343 75,193
PROPERTIES, at cost:
Land and improvements 5,173 3,433
Buildings and improvements 27,656 22,820
Machinery and equipment 57,532 52,488
90,361 78,741
Accumulated depreciation ( 49,615) ( 49,055)
Net properties 40,746 29,686
$334,594 $330,225
<FN>
See Notes to Condensed Consolidated Financial Information.
</TABLE>
KATY INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 1994 AND DECEMBER 31, 1993
<TABLE>
<CAPTION>
March 31, December 31,
1994 1993
(Thousands of Dollars)
<S> <C> <C>
CURRENT LIABILITIES:
Notes payable $ 10,128 $ 10,163
Accounts payable 8,507 8,777
Accrued compensation 4,521 5,058
Accrued expenses 21,784 21,508
Accrued interest and taxes 1,227 1,131
Current maturities, long-term debt 3,214 2,991
Dividends payable 643 643
Total current liabilities 50,024 50,271
LONG-TERM DEBT, less current maturities 5,793 4,289
OTHER LIABILITIES 30,756 31,899
MINORITY INTEREST 205 -
STOCKHOLDERS' EQUITY
Common stock, $1 par value, authorized
25,000,000 shares, issued 9,821,329
shares 9,821 9,821
Additional paid-in capital 51,111 51,111
Foreign currency translation adjustment 4,051 3,880
Unrealized holding gain, net of tax - Note 1 7,631 -
Retained earnings 189,062 192,814
Treasury stock, 803,942 shares ( 13,860) ( 13,860)
Total stockholders' equity 247,816 243,766
$334,594 $330,225
<FN>
See Notes to Condensed Consolidated Financial Information.
</TABLE>
KATY INDUSTRIES, INC.
STATEMENTS OF CONDENSED CONSOLIDATED OPERATIONS
THREE MONTHS ENDED MARCH 31, 1994 AND 1993
<TABLE>
<CAPTION>
1994 1993
(Thousands of Dollars
Except Per Share Data)
<S> <C> <C>
Net sales $ 38,423 $ 40,340
Costs and expenses:
Cost of goods sold 27,036 29,077
Selling, general and administrative 9,863 11,495
Depreciation and amortization 1,544 1,496
Interest expense 520 413
Interest income ( 1,225) ( 1,538)
Other, net - Note 3 6,350 ( 34,521)
44,088 34,521
Income (Loss) from continuing consolidated
operations before provision for income
taxes and minority interest ( 5,665) 5,819
Benefit (Provision) for income taxes 1,864 ( 2,752)
Minority stockholders share of loss - 510
Income from continuing consolidated
operations ( 3,801) 3,577
Equity in income of unconsolidated
subsidiaries (net of tax) - Note 2 613 659
Gain as a result of an initial public offering
by an unconsolidated subsidiary (net of tax) -
Note 2 - 835
Income (Loss) from continuing operations ( 3,188) 5,071
Discontinued consolidated operation (net of tax) - ( 1,343)
Income (Loss) before cumulative effect of
change in accounting principle ( 3,188) 3,728
Cumulative effect of change in accounting principle - ( 1,418)
Net income (loss) ($ 3,188) $ 2,310
Earnings (Loss) per share:
Income (Loss) from continuing operations ($ .35) $ .56
Discontinued consolidated operations - ( .15)
Cumulative effect of change
in accounting principle - ( .15)
Net income (loss) ($ .35) $ .26
Average shares outstanding (in thousands) 9,017 9,017
Dividends per share - common stock
$1.00 par value $ .0625 $ .0625
<FN>
See Notes to Condensed Consolidated Financial Information.
</TABLE>
KATY INDUSTRIES, INC.
STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1994 AND 1993
<TABLE>
<CAPTION>
1994 1993
(Thousands of Dollars)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) ($ 3,188) $ 2,310
Gain as a result of an initial public
offering by an unconsolidated subsidiary - ( 835)
Write off of investment 6,580 -
Gain on sale of assets ( 4) ( 6,075)
Discontinued operation - 1,343
Cumulative effect of change in accounting principle - 1,418
Adjustments to reconcile net income to net cash
flows from operating activities ( 6,057) ( 1,589)
Net cash flows from operating activities ( 2,669) ( 3,428)
Cash flows from investing activities:
Proceeds from sale of assets 204 11,157
Time deposits and marketable securities activity - 13,787
Collections of notes receivable 108 40
Purchase of subsidiary, net of cash
acquired ( 2,226) ( 125)
Capital expenditures ( 731) ( 1,418)
Net cash flows from investing activities ( 2,645) 23,441
Cash flows from financing activities:
Notes payable activity, net ( 36) ( 890)
Principal payments on long-term debt ( 1,467) ( 280)
Payment of dividends ( 564) ( 564)
Proceeds from issuance of long-term debt 4 44
Net cash flows from financing activities ( 2,063) ( 1,690)
Net increase (decrease) in cash and cash
equivalents ( 7,377) 18,323
Cash and cash equivalents beginning of period 130,289 34,801
Cash and cash equivalents end of period $122,912 $ 53,124
<FN>
See Notes to Condensed Consolidated Financial Information.
</TABLE>
(1) Significant Accounting Policies
Consolidation Policy
The financial statements include, on a consolidated basis, the
accounts of Katy Industries, Inc. and subsidiaries (Katy) in which it has
greater than 50% interest.
The information furnished reflects all known adjustments which are,
in the opinion of management, necessary for a fair presentation. Interim
figures are subject to year-end audit adjustments.
Inventories
The components of inventories are as follows:
March 31, December 31,
1994 1993
(Thousands of Dollars)
Raw materials.............. $13,113 $13,710
Work in process............ 8,786 9,582
Finished goods............. 18,492 17,433
$40,391 $40,725
New Accounting Pronouncements
On January 1, 1994 Katy adopted Statement of Financial Accounting
Standards ("SFAS") No. 115 "Accounting for Certain Investments in Debt and
Equity Securities". SFAS No. 115 requires, among other things, that
securities which are available for sale be classified as such and stated
at their fair value with the unrealized holding gain or loss accounted for
as a separate component of stockholders' equity.
Adoption of SFAS No. 115 resulted in the reclassification of
marketable securities with a cost of $15,795,000 to securities available-
for-sale. Such securities were also revalued to their fair value on
January 1, 1994 of $31,223,000 and the unrealized holding gain of
$9,257,000, net of related taxes, was accounted for a separate component
of stockholders equity. During the three months ended March 31, 1994
there were no purchases or sales of marketable securities.
(2) Investments, at Equity, and Advances to Unconsolidated Subsidiaries
Katy's investments in and advances to unconsolidated subsidiaries are
comprised of the following:
March 31, 1994 Investments Advances Total
(Thousands of Dollars)
Syratech Corporation $34,053 $ - $34,053
Bee Gee Holding Company, Inc. 6,261 - 6,261
$40,314 $ - $40,314
December 31, 1993 Investments Advances Total
(Thousands of Dollars)
Syratech Corporation $32,977 $ - $32,977
Bee Gee Holding Company, Inc. 6,281 - 6,281
C.E.G.F. (USA) 2,060 4,198 6,258
$41,318 $ 4,198 $45,516
On March 27, 1994 Katy purchased 50% of the outstanding common stock
of C.E.G.F. (USA) for $2,750,000 which purchase results in Katy owning 95%
of C.E.G.F. The excess of the purchase price over the book value of net
assets purchased has been allocated to properties and is being depreciated
over the remaining lives of the assets. As of March 31, 1994 the balance
sheet of C.E.G.F. is included in Katy's Condensed Consolidated Balance
Sheet and beginning in the second quarter of 1994 the income statement of
C.E.G.F. will be included in Katy's Statement of Condensed Consolidated
Operations.
In December, 1992 Syratech Corporation completed an Initial Public
Offering at $16.50 a share. This transaction diluted Katy's ownership
percentage to 28.8% from 36.1%. Katy's share of Syratech's increased
shareholder equity accounts resulted in a credit of $1,369,000 before
income taxes of $534,000 ($.09 per share) to Katy's Statement of Condensed
Consolidated Operations in the first quarter of 1993. At the time of the
Initial Public Offering, Syratech adopted a shareholder rights plan.
Katy's shares are not registered and if sold to a single purchaser would
cause the shareholder rights plan to become effective. Katy accounts for
this investment on a three month lag basis.
(2)Investments, at Equity, and Advances to Unconsolidated Subsidiaries
(Continued)
The condensed financial information which follows reflects Katy's
proportionate share in the financial position and results of operations of
all of its unconsolidated subsidiaries:
March 31, December 31,
1994 1993
(Thousands of Dollars)
Current assets $35,197 $35,356
Current liabilities ( 12,715) ( 13,864)
Working capital 22,482 21,492
Properties, net 24,959 29,283
Other assets 823 913
Long-term debt ( 5,502) ( 8,979)
Other liabilities ( 5,942) ( 5,234)
Stockholders' equity 36,820 37,475
Unamortized excess of cost
over net assets acquired 3,494 3,843
Investments, at equity,
in unconsolidated
subsidiaries $40,314 $41,318
Three Months
Ended March 31
1994 1993
(Thousands of Dollars)
Sales $ 20,894 $ 22,834
Costs and expenses ( 19,575) ( 21,503)
Net income 1,319 1,331
Amortization of excess
of cost over net
assets acquired ( 204) ( 167)
Provision for income taxes( 502) ( 505)
Equity in income of
unconsolidated
subsidiaries $ 613 $ 659
(3) Investments, at Cost
In April, 1994 management of Katy met with Katy's oil exploration
joint venture partners and, based on current facts and circumstances, Katy
has decided not to commit further funds to the oil exploration project and
will not participate in any further activities on the site. Accordingly,
in March, 1994 Katy wrote off its $6,580,000 investment.
In January, 1993 Katy sold its 8% interest, (78,145 shares of common
stock) in Compagnie des Entrepots et Gares Frigorifiques (CEGF), a French
cold storage company, for cash proceeds of $10,953,000 resulting in a pre-
tax gain of $6,081,000.
LIQUIDITY AND CAPITAL RESOURCES
On March 9, 1994 Katy announced that it was considering a special
dividend of $14.00 per share to holders of Katy common stock to maximize
stock value. The Board of Directors has deferred the declaration and
payment of the dividend until the resolution of a motion pending before
the Delaware Court of Chancery in a lawsuit brought by Pensler Capital
Corp. The special cash dividend, if paid, would amount to $126,000,000
and would be provided out of Katy's cash and cash equivalents.
During the three months ended March 31, 1994 and 1993 working capital
increased $5,406,000 and $2,492,000, respectively. Current ratios were
4.61 to 1.00 at March 31, 1994 and 4.48 to 1.00 at December 31, 1993.
Katy has authorized and expects to commit an additional $3,200,000 for
capital projects during the remainder of 1994. Funding for these
expenditures is expected to be accomplished substantially through use of
internally generated funds from operations supplemented by short-term
borrowings.
On January, 1, 1994 Katy adopted Statement of Financial Accounting
Standards ("SFAS") No. 115 "Accounting for Certain Investments in Debt and
Equity Securities". SFAS No. 115 requires, among other things, that
securities which are available for sale be classified as such and stated
at their fair value with the unrealized holding gain or loss accounted for
as a separate component of stockholders' equity. Upon adoption Katy
reclassified marketable securities with a cost of $15,795,000 to
securities available for sale. Such securities were revalued to their
fair value, on January 1, 1994, of $31,223,000 and the unrealized holding
gain of $9,257,000, net of related taxes, was accounted for as a separate
component of stockholders' equity. As of March 31, 1994 the securities were
valued at $28,294,000 and the unrealized holding gain was $7,631,000.
The Company and certain of its current and former direct and indirect
corporate predecessors, subsidiaries and divisions have been identified by
the U.S. Environmental Protection Agency and certain state environmental
agencies and private parties as potentially responsible parties ("PRP's")
at a number of hazardous waste disposal sites under the Comprehensive
Environmental Response, Compensation and Liability Act ("Superfund") and
equivalent state laws and, as such, may be liable for the cost of cleanup
and other remedial activities at these sites. Responsibility for cleanup
and other remedial activities at a Superfund site is typically shared
among PRPs based on an allocation formula. The means of determining
allocation among PRPs is generally set forth in a written agreement
entered into by the PRPs at a particular site. An allocation share
assigned to a PRP is often based on the PRP's volumetric contribution of
waste to a site. The Company is also involved in remedial response and
voluntary environmental clean-up at a number of other sites which are not
currently the subject of any legal proceedings under Superfund, including
certain of its current and formerly owned manufacturing facilities. Based
on its estimate of allocation of liability among PRPs, the probability
that other PRPs, many of whom are large, solvent, public companies, will
fully pay the costs apportioned to them, currently available information
concerning the scope of contamination, estimated remediation costs,
estimated legal fees and other factors, the Company has made provisions
for indicated environmental liabilities in the aggregate amount of
approximately $7,500,000.
Although management believes that these actions in the aggregate are
not likely to have a material adverse effect on Katy's consolidated
financial position or results of operations, further costs could be
significant and will be recorded as a charge to operations when such costs
become probable and reasonably estimable.
Katy also has a number of product liability and workers' compensation
claims pending against it and its subsidiaries. With respect to the
product liability and workers' compensation claims, Katy has provided for
its share of expected losses beyond the applicable insurance coverage,
including those incurred but not reported. Such accruals are developed
using currently available claim information. The incurred but not
reported component of the liability was developed using actuarial
techniques.
At March 31, 1994 Katy had short and long-term indebtedness for money
borrowed of $19,135,000 of which $10,128,000 represented short-term bank
credit lines from banks in Germany in support of Katy's 75% owned German
subsidiary. Total debt was 7.2% of total debt and equity at March 31,
1994. Katy has a credit agreement with a consortium of two banks in the
aggregate principal amount of $15,000,000. The credit agreement may be
used for letters of credit and/or working capital.
During the first quarter of 1994, Katy's 75% owned German subsidiary,
Schon & Cie, A.G. ("Schon") continued to incur substantial losses from
operations, which were mitigated somewhat by a partial recovery of trade
receivables written-off in prior years. Schon has continued to incur
substantial losses from operations since its first quarter, which ended in
January, and the sales order backlog is inadequate. Management is
evaluating its options with regard to Schon.
In April, 1994 management of Katy met with Katy's oil exploration
joint venture partners and, based on current facts and circumstances, Katy
has decided not to commit further funds to the oil exploration project,
and will not participate in any further activities on the site.
Accordingly, the Company wrote off its investment in the oil exploration
joint venture in March, 1994.
Management is in the process of reviewing each of its businesses to
determine the Company's focus for the future. Upon the conclusion of such
review, management may determine to sell certain companies and may augment
its remaining businesses with acquisitions. Such review has yet to be
completed and there have been no decisions regarding the disposition of
any companies. Should such sales occur, management anticipates that funds
from these sales would be used for general corporate purposes. Any
acquisitions would be funded through current cash balances and available
lines of credit.
RESULTS OF OPERATIONS
Three Months Ended March 31, 1994
Following is a summary of sales and operating income for the three
months ended March 31, 1994 and 1993 by industry segment:
<TABLE>
<CAPTION
Three Months Ended
March 31 Increase (Decrease)
1994 1993 Amount Per Cent
(Thousands of Dollars)
<S> <C> <C> <C> <C>
Industrial Machinery $ 15,581 $ 12,833 $ 2,748 21.4%
Industrial Components 7,634 13,563 ( 5,929) (43.7 )
Consumer Products 15,208 13,944 1,264 9.1
Total sales $ 38,423 $ 40,340 ($ 1,917) ( 4.8%)
Operating Income
Percent of Sales
1994 1993 1994 1993
(Thousands of Dollars)
Industrial Machinery ($ 197) ($ 1,064) ( 1.3%) ( 8.3%)
Industrial Components 505 711 6.6 5.2
Consumer Products 1,751 1,091 11.5 7.8
Total sales $ 2,059 $ 738 5.4% 1.8%
</TABLE>
The Industrial Machinery segment reported increased sales from all
units except the manufacturer of presses. The 1994 operating loss
reported for the segment was considerably less than the loss reported in
1993, the result of improved operating margins.
RESULTS OF OPERATIONS (Continued)
Three Months Ended March 31, 1994
The Industrial Components segment reported decreased sales and
operating income substantially due to the sale of the pump manufacturing
operation in the fourth quarter of 1993. The manufacturer of electrical
equipment reported increased sales with lower operating income, the result
of lower profit margins in 1994. The manufacturer of precision metal
products reported increased sales and operating income, the result of
increased sales and margins. The supplier of components to the oil, gas
and petroleum industry experienced reduced sales and operating income, the
result of a lower sales level and reduced margins.
The Consumer Products segment reported increased sales and operating
income, the result of improved margins. All units in the group, except
for the filter business, reported increased sales and operating income.
The filter business reported decreased sales, but improved operating
margins, due to the closing of the IAQ 2000 product line in the fourth
quarter of 1993.
Selling, general and administrative expenses decreased $1,632,000, or
14%, primarily the result of the $900,000 charge in 1993 for a retirement
compensation program for Katy's Chairman of the Board and the sale of the
pump manufacturing business in the fourth quarter of 1993.
Income before income taxes decreased by $11,484,000, the result of
writing off Katy's investment in an oil exploration joint venture
($6,580,000 charge in 1994), partially offset by recovery of a portion of
a previously written off trade receivable by the German subsidiary and the
inclusion in 1993 of the $6,081,000 gain on the sale of Katy's investment
in C.E.G.F. (France). For additional information see Note 3 of Notes to
Condensed Consolidated Financial Information. Interest income decreased
$313,000 substantially the result of the conversion of Union Pacific
Corporation notes into stock during the first quarter of 1993 and the
subsequent loss of interest income.
The provision for income taxes decreased $4,616,000, the result of
lower taxable income partially offset by a lower effective tax rate in
1994 due to a decrease in the losses generated by our German subsidiary,
which losses continue to be ineligible for tax benefits.
Equity in income of unconsolidated subsidiaries increased by $46,000,
or 7.0%. Syratech Corporation reported higher earnings in 1994, but due
to the dilution of Katy's ownership during 1993, the amount of Katy's
equity in Syratech's earnings decreased. Bee Gee Holding Company reported
a smaller loss and C.E.G.F. (USA) reported increased earnings in 1994. On
March 27, 1994 Katy purchased 50% of the outstanding common stock of
C.E.G.F. (USA) for $2,750,000 increasing its ownership to 95% of C.E.G.F.
(USA). As of March 31, 1994 the balance sheet of C.E.G.F. is included in
Katy's Condensed Consolidated Balance Sheet. Beginning in the second
quarter of 1994 the results of C.E.G.F. (USA)'s operations will be
included in Katy's Statement of Condensed Consolidated Operations. The
gain, in 1993, of $835,000 net of income taxes of $534,000, is a result of
an initial public offering by an unconsolidated subsidiary and is Katy's
share of the increased shareholders' equity accounts of Syratech
Corporation. For additional information on unconsolidated subsidiaries
see Note 2 of Notes to Condensed Consolidated Financial Information.
During the first quarter of 1993 Katy provided $1,343,000, net of
income tax benefits of $752,000, for additional environmental cleanup
costs for plant sites of units discontinued in prior years.
The cumulative effect of change in accounting principal in 1993 of
$1,418,000 is net of income tax benefits of $925,000 and results from the
adoption of Statement of Financial Accounting Standards (SFAS) No. 106,
"Employers' Accounting for Postretirement Benefits Other Than Pensions."
KATY INDUSTRIES, INC.
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
Except as disclosed below, during the quarter for which this report is
filed, there have been no material developments in previously reported
legal proceedings, and no other cases or legal proceedings, other than
ordinary routine litigation incidental to Katy's business and other non-
material proceedings, have been brought against Katy.
a. Missouri Pacific Railroad Company v. Katy Industries, Inc.,
(United States District Court, Northern District of Illinois,
Eastern Division); filed August 6, 1993. This matter,
described in Katy's Form 10-K for the year ended December 31,
1993 (the "10-K"), has been dismissed without prejudice by
stipulation of the parties.
b. Demand for Indemnification - Londonderry, New Hampshire. Katy
has agreed to indemnify and defend Allard Industries, Inc.
("Allard") in response to Allard's demand that it do so, as more
fully described in the 10-K. Katy's liability, if any, with
respect to this matter cannot be determined at this time.
Item 5. OTHER INFORMATION
On March 9, 1994, Katy issued a press release announcing
that its Board of Directors has endorsed the recommendation
of a special committee of the Board that the Company
consider a special cash dividend of $14.00 per share to
holders of Katy Industries common stock to maximize
shareholder values.
The press release also said that action by the Board to
declare the dividend, however, will be deferred until the
resolution of a motion pending before the Delaware Court of
Chancery in a lawsuit brought by Pensler Capital Corp. The
press release further stated that Pensler's motion seeks a
preliminary injunction requiring Katy, among other things,
to negotiate with Pensler and Steinhardt Enterprise, Inc.
in connection with their previously rejected acquisition
proposal for Katy and prohibiting Katy from, among other
things, pursuing any extraordinary dividend.
On March 17, 1994, the Court of Chancery heard Pensler's
motion and took the matter under advisement.
KATY INDUSTRIES, INC.
PART II - OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Reports on Form 8-K
On February 1, 1994 Katy filed a Report on Form 8-K dated
February 1, 1994 reporting under Item 7 a press release
announcing that the Board of Directors concluded that it was not
in the best interest of the Company and its shareholders to
continue negotiating with Steinhardt Pensler a merger agreement
containing a dilutive option. The press release also announced
that the Board appointed Charles W. Sahlman, Philip E. Johnson
and William F. Andrews as a committee to evaluate and recommend
to the Board of Directors at a March 8, 1994 Board of Directors
meeting which of the following, a self tender at a fixed price,
a Dutch auction or a dividend of not less than $10 per share
(any one or combination of the foregoing) that the Company
should take to maximize shareholder values. The press release
stated that no assurance could be given as to whether or when
any such action would be taken.
Signatures
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
KATY INDUSTRIES, INC.
Registrant
DATE: May 16, 1994 By /s/John R. Prann, Jr.
John R. Prann, Jr.
President
Chief Operating Officer
DATE: May 16, 1994 By /s/P. Kurowski
P. Kurowski
Treasurer
Chief Financial Officer
