UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File No. 0-12321
TRANSFINANCIAL HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
Delaware 46-0278762
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
8245 Nieman Road, Suite 100
Lenexa, Kansas 66214
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (913) 859-0055
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes ( X ) No ( )
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding at November 7, 1997
Common stock, $0.01 par value 6,042,587 Shares
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
TRANSFINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED SEPTEMBER 30,
(In thousands, except per share amounts)
(Unaudited)
<CAPTION>
1997 1996
<S> <C> <C>
Operating Revenues.......................................................... $ 35,208 $ 30,041
Operating Expenses.......................................................... 34,342 29,332
Operating Income............................................................ 866 709
Nonoperating Income (Expense)
Interest income.......................................................... 148 278
Other.................................................................... 33 19
Total nonoperating income (expense).................................. 181 297
Income Before Income Taxes.................................................. 1,047 1,006
Income Tax Provision........................................................ 478 501
Net Income.................................................................. $ 569 $ 505
Average Common Shares Outstanding (Note 5).................................. 6,111 6,609
Net Income Per Share........................................................ $ 0.09 $ 0.08
<FN>
The accompanying notes to consolidated financial statements are an
integral
part of these statements.
</TABLE>
<TABLE>
TRANSFINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE NINE MONTHS ENDED SEPTEMBER 30,
(In thousands, except per share amounts)
(Unaudited)
<CAPTION>
1997 1996
<S> <C> <C>
Operating Revenues.......................................................... $ 99,372 $ 83,604
Operating Expenses.......................................................... 96,507 82,275
Operating Income............................................................ 2,865 1,329
Nonoperating Income (Expense)
Interest income.......................................................... 538 886
Other.................................................................... 73 45
Total nonoperating income (expense).................................. 611 931
Income Before Income Taxes.................................................. 3,476 2,260
Income Tax Provision........................................................ 1,571 1,040
Net Income.................................................................. $ 1,905 $ 1,220
Average Common Shares Outstanding (Note 5).................................. 6,268 6,878
Net Income Per Share........................................................ $ 0.30 $ 0.18
<FN>
The accompanying notes to consolidated financial statements are an
integral
part of these statements.
</TABLE>
<TABLE>
TRANSFINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1997 1996
ASSETS (Unaudited)
<S> <C> <C>
Current Assets:
Cash and temporary cash investments...................................... $ 5,283 $ 9,021
Short-term investments................................................... 3,252 9,957
Freight accounts receivable, less allowance
for doubtful accounts of $444 and $419, respectively................. 12,540 9,233
Finance accounts receivable, less allowance
for doubtful accounts of $514 and $769, respectively................. 16,157 14,554
Current deferred tax assets.............................................. -- 618
Other current assets..................................................... 2,587 1,965
AFS net assets (Note 6).................................................. 8,194 7,570
Total current assets................................................. 48,013 52,918
Operating Property, at Cost:
Revenue equipment........................................................ 29,766 24,373
Land..................................................................... 3,585 3,489
Structures and improvements.............................................. 10,420 10,087
Other operating property................................................. 8,845 5,328
52,616 43,277
Less accumulated depreciation........................................ (21,982) (19,887)
Net operating property........................................... 30,634 23,390
Intangibles, net of accumulated amortization................................ 9,446 9,497
Other Assets................................................................ 401 1,007
$ 88,494 $ 86,812
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable......................................................... $ 2,749 $ 2,980
Accrued payroll and fringes.............................................. 7,218 5,533
Claims and insurance accruals............................................ 209 246
Accrued and current deferred income taxes................................ 191 --
Other accrued expenses................................................... 1,893 2,289
Total current liabilities............................................ 12,260 11,048
Deferred Income Taxes....................................................... 2,179 1,203
Other Non-Current Liabilities and Minority Interest......................... 469 --
Shareholders' Equity (Note 5)
Preferred stock with $0.01 par value, authorized 1,000,000 shares,
none outstanding..................................................... -- --
Common stock with $0.01 par value, authorized 13,000,000 shares,
issued 7,508,022 and 7,605,570 shares, respectively.................. 75 76
Paid-in capital.......................................................... 4,625 5,529
Retained earnings........................................................ 81,147 79,242
Treasury stock, 1,448,735 and 1,224,661 shares, respectively, at cost.... (12,261) (10,286)
Total shareholders' equity........................................... 73,586 74,561
$ 88,494 $ 86,812
<FN>
The accompanying notes to consolidated financial statements are an
integral part of these statements.
</TABLE>
<TABLE>
TRANSFINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30,
(In thousands)
(Unaudited)
<CAPTION>
1997 1996
<S> <C> <C>
Cash Flows From Operating Activities
Net income.......................................................... $ 1,905 $ 1,220
Adjustments to reconcile net income to
cash provided by operating activities
Gain on sale of operating property, net......................... (55) (64)
Depreciation and amortization................................... 3,404 2,616
Provision for credit losses..................................... 722 611
Deferred tax provision.......................................... 1,697 697
Net increase (decrease) from change in other
working capital items affecting operating activities........... (3,997) (644)
3,676 4,436
Cash Flows From Investing Activities
Purchase of finance subsidiaries (Note 2)........................... -- (11,979)
Purchase of operating property...................................... (8,792) (6,370)
Origination of finance accounts receivable.......................... (95,626) (88,206)
Sale of finance accounts receivable................................. 62,871 30,140
Collection of owned finance accounts receivable..................... 30,520 59,711
Purchases of short-term investments................................. (10,411) (17,454)
Maturities of short-term investments................................ 17,116 39,628
Other............................................................... (743) (351)
(5,065) 5,119
Cash Flows From Financing Activities
Payments to acquire treasury stock.................................. (1,973) (4,982)
Payments for fractional shares from reverse stock split............. (427) --
Borrowings (repayments) on credit agreements, net................... 8 (335)
Other............................................................... 43 70
(2,349) (5,247)
Net Increase (Decrease) in Cash and Temporary Cash Investments........ (3,738) 4,308
Cash and Temporary Cash Investments at beginning of period............ 9,021 6,617
Cash and Temporary Cash Investments at end of period.................. $ 5,283 $ 10,925
Cash Paid During the Period for
Interest............................................................ $ -- $ 854
Income Tax.......................................................... $ 35 $ 92
<FN>
The accompanying notes to consolidated financial statements are an
integral part of these statements.
</TABLE>
<TABLE>
TRANSFINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(In thousands)
<CAPTION>
Total
Share
Common Paid-In Retained Treasury holders'
Stock Capital Earnings Stock Equity
<S> <C> <C> <C> <C> <C>
Balance at December 31, 1995.................. $ 76 $ 5,357 $ 78,390 $ (3,543) $ 80,280
Net income.................................... -- -- 852 -- 852
Issuance of shares under Incentive Stock Plan. -- 172 -- (87) 85
Purchase of 797,341 shares of common stock.... -- -- -- (6,656) (6,656)
Balance at December 31, 1996.................. 76 5,529 79,242 (10,286) 74,561
Net income.................................... -- -- 1,905 -- 1,905
Fractional shares cancelled in reverse stock
split....................................... (1) (949) -- -- (950)
Issuance of shares under Incentive Stock Plan. -- 45 -- (2) 43
Purchase of 223,899 shares of common stock.... -- -- -- (1,973) (1,973)
Balance at September 30, 1997 (unaudited)..... $ 75 $ 4,625 $ 81,147 $(12,261) $ 73,586
<FN>
The accompanying notes to consolidated financial statements are an
integral part of these statements.
</TABLE>
TRANSFINANCIAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include TransFinancial Holdings, Inc.
("TransFinancial") and all of its subsidiary companies (the "Company").
Pursuant to the approval of shareholders the Company changed its name from
Anuhco, Inc. to TransFinancial Holdings, Inc. effective June 30, 1997. All
significant intercompany accounts and transactions have been eliminated in
consolidation. The condensed financial statements included herein have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission ("SEC") and have not been examined or reviewed by independent public
accountants. In the opinion of management, all adjustments necessary to fairly
present the results of operations have been made.
Pursuant to SEC rules and regulations, certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
from these statements unless significant changes have taken place since the end
of the most recent fiscal year. TransFinancial believes that the disclosures
contained herein, when read in conjunction with the financial statements and
notes included, or incorporated by reference, in TransFinancial's Form 10-K/A-3,
filed with the SEC on May 5, 1997, are adequate to make the information
presented not misleading. It is suggested, therefore, that these statements be
read in conjunction with the statements and notes included, or incorporated by
reference, in the aforementioned report on Form 10-K/A-3.
2. ACQUISITION OF PREMIUM FINANCE SUBSIDIARIES
On March 29, 1996, TransFinancial completed the acquisition of all of the
issued and outstanding stock of Universal Premium Acceptance Corporation and
UPAC of California, Inc. (together referred to as "UPAC"). UPAC and Agency
Premium Resource, Inc. ("APR"), the Company's other finance subsidiary, offer
short-term collateralized financing of commercial and personal insurance
premiums through approved insurance agencies throughout the United States. At
March 31, 1996, UPAC had outstanding net finance receivables of approximately
$30 million. This transaction was accounted for as a purchase. TransFinancial
utilized a portion of its available cash and short-term investments to
consummate the purchase at a price of approximately $12 million. The terms of
the acquisition and the purchase price resulted from negotiations between
TransFinancial and William H. Kopman, the former sole shareholder of UPAC. In
connection with the purchase of UPAC, the Company has recorded goodwill of $6.6
million, which is being amortized on the straight-line basis over 25 years.
In addition to the Stock Purchase Agreement by which TransFinancial acquired
all of the UPAC stock, the Company entered into a consulting agreement with Mr.
Kopman. Under the consulting agreement, TransFinancial is entitled to consult
with Mr. Kopman on industry developments as well as UPAC operations through
December 31, 1998. In addition to retaining the services of Mr. Kopman under a
consulting agreement, certain executive management personnel of UPAC were
retained under multiyear employment agreements.
The unaudited pro forma operating results of TransFinancial for the nine
months ended September 30, 1996, assuming the acquisition occurred as of the
beginning of the period, were operating revenues of $84,837,000, net income of
$1,205,000, and net income per share of $0.18. The pro forma results of
operations are not necessarily indicative of the actual results that would have
been obtained had the acquisition been made at the beginning of the period, or
of results which may occur in the future.
3. PROFIT SHARING
In September 1988, the employees of Crouse Cartage Company ("Crouse"), a
wholly owned subsidiary of TransFinancial, approved the establishment of a
profit sharing plan ("the Plan"). The Plan is structured to allow all employees
(union and non-union) to ratably share 50% of Crouse's income before income
taxes (excluding extraordinary items and gains or losses on the sale of assets)
in return for a 15% reduction in their wages. Plan distributions are made on a
quarterly basis. The Plan was recertified in 1991 and 1994, and shall continue
in effect through March 31, 1998, or until a replacement of the Collective
Bargaining Agreement is reached between the parties, whichever is later. The
accompanying consolidated balance sheets as of September 30, 1997 include an
accrual for profit sharing costs of $986,000. The accompanying consolidated
statements of income include profit sharing costs of $986,000 and $953,000 for
the third quarter of 1997 and 1996, and $2,812,000 and $2,142,000 for the first
nine months of 1997 and 1996.
4. FINANCING AGREEMENTS
In December, 1996, TransFinancial, UPAC and APR Funding Corporation (a wholly-
owned subsidiary) entered into an extendible three year securitization agreement
whereby undivided interests in a designated pool of accounts receivable can be
sold on an ongoing basis. The maximum allowable amount of receivables to be
sold under the agreement is $50,000,000. This agreement replaced a similar
securitization agreement with another financial institution that was entered
into in October, 1995 and UPAC's secured credit agreement, dated July, 1994.
The purchaser permits principal collections to be reinvested in new financing
agreements. The Company had securitized receivables of $34.8 million at
September 30, 1997. The cash flows from the sale of receivables are reported as
investing activities in the accompanying consolidated statement of cash flows.
The securitized receivables are reflected as sold in the accompanying balance
sheet. The proceeds from the initial securitization of the receivables were
used to purchase previous securitized receivables under the prior agreement and
to pay off the secured note payable under UPAC's secured credit agreement.
The terms of the agreement require UPAC to maintain a minimum tangible net
worth of $5 million and contain restrictions on the payment of dividends by UPAC
to TransFinancial without prior consent of the financial institution. The terms
of the agreement also require the Company to maintain a minimum consolidated
tangible net worth of $50 million. The Company was in compliance with all such
provisions at September 30, 1997. The terms of the securitization agreement
also require that UPAC maintain a default reserve at specified levels which
serves as collateral. At September 30, 1997, approximately $5.5 million of
owned finance receivables served as collateral under the default reserve
provision.
Effective January 1, 1997, the Company adopted the requirements of Statement
of Financial Accounting Standards No. 125 ("SFAS No. 125"), "Accounting for the
Transfers and Servicing of Financial Assets and Extinguishment of Liabilities,"
for transfers occurring after December 31, 1996. The adoption of SFAS No. 125
did not have a material impact on the net income of the Company.
In September 1988, Crouse entered into a multi-year credit agreement with a
commercial bank which provided for maximum borrowings equaling the lesser of
$2,500,000 or the borrowing base, as defined in such agreement. In September,
1996 the term of this agreement was extended to June 30, 1998. There was no
outstanding balance on this revolving line of credit at September 30, 1997.
5. SHAREHOLDERS' EQUITY
Income per share is based on the average number of common shares outstanding
during each period. The average number of common shares so computed was
6,110,841 and 6,609,287 for the quarters ended September 30, 1997 and 1996, and
6,267,549 and 6,877,995 for the first nine months of 1997 and 1996.
On June 26, 1995, the Company adopted a program to repurchase up to 10% of its
outstanding shares of common stock. During the second quarter of 1996, the
Company completed this initial repurchase program and expanded the number of
shares authorized to be repurchased by an additional 10% of its then outstanding
shares. During the third quarter and first nine months of 1997, the Company
repurchased an additional 93,848 shares and 223,899 shares of common stock,
bringing the total shares repurchased to 1,438,340 shares, or 19.0% of
outstanding shares before initiating the program, at a total cost of
$12,173,000.
On June 26, 1997, the shareholders of the Company approved a 1-for-100 reverse
stock split followed by a 100-for-1 forward stock split. These stock splits
were effected on July 1, 1997. The result of this transaction was the
cancellation of approximately 107,000 shares of common stock held by holders of
fewer than 100 shares at a market price of $8.89 per share.
6. AFS NET ASSETS
Under the provisions of a Joint Plan of Reorganization ("the Joint Plan"), AFS
is responsible for the administration of pre-July 12, 1991 creditor claims and
conversion of assets owned before that date. As claims were allowed and cash
was available, distributions to the creditors occurred. The Joint Plan also
provided for distributions to TransFinancial as unsecured creditor distributions
occurred in excess of 50% of allowed claims. TransFinancial also will receive
the full benefit of any remaining assets of AFS through its ownership of AFS
stock, after unsecured creditors received distributions, including interest,
equivalent to 130% of their claims.
AFS has made full payment of all its resolved claims and liabilities. The
remaining AFS net assets are estimated to have net realizable value of $8.2
million. The primary assets include approximately $6.7 million in cash and
investments. There are no material claims outstanding as of September 30, 1997.
The remaining AFS assets are recorded at their estimated net realizable value.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
RESULTS OF OPERATIONS
Third quarter and nine months ended September 30, 1997 compared to the third
quarter and nine months ended September 30, 1996
With the acquisition of APR on May 31, 1995, and UPAC on March 29, 1996,
TransFinancial now operates in two distinct industries; transportation, through
its subsidiary, Crouse; and financial services, through its subsidiaries, APR
and UPAC.
TRANSPORTATION
Operating Revenue - The changes in transportation operating revenue are
summarized in the following table (in thousands):
Qtr. 3 1997 Nine Months 1997
vs. vs.
Qtr. 3 1996 Nine Months 1996
Increase (decrease) from:
Increase in LTL tonnage........................ $3,485 $10,725
Increase in LTL revenue per hundredweight...... 1,623 3,100
Increase in truckload revenues................. 245 856
Net increase............................... $5,353 $14,681
Less-than-truckload ("LTL") operating revenues rose by 22.1% and 18.7% for the
third quarter and first nine months of 1997, as compared to the same periods in
1996. Crouse achieved increases of 15.0% and 16.6% in LTL tons for the third
quarter and first nine months of 1997, compared to 1996. Third quarter LTL
revenues, tons and shipments were increased during the recent Teamster strike
against UPS as Crouse met customers' needs for small parcel shipments. Crouse's
LTL revenue yield improved approximately 7.0% and 4.8%, from the third quarter
and first nine months of 1996 to the same periods of 1997. The third quarter
improvement in revenue yield was impacted substantially by the additional volume
of small parcel shipments handled. These improvements were also the result of a
general rate increase placed in effect January 1, 1997, negotiated rate
increases on certain shipping contracts and fuel surcharges to pass-through to
customers the continuing high cost of diesel fuel.
Truckload operating revenues were more than 5.2% and 6.3% higher in the third
quarter and nine months of 1997, on approximately 9% more shipments, offset by
slight declines in revenue per shipment.
Operating Expense - A comparative summary of transportation operating expenses
as a percent of transportation operating revenue follows:
<TABLE>
<CAPTION>
Percent of Operating Revenue
Third Quarter Nine Months
1997 1996 1997 1996
<S> <C> <C> <C> <C>
Salaries, wages and employee benefits................... 57.0% 56.2% 56.8% 55.9%
Operating supplies and expenses.......................... 11.9% 12.1% 12.3% 12.8%
Operating taxes and licenses............................. 2.5% 2.6% 2.7% 2.8%
Insurance and claims..................................... 2.4% 2.0% 2.1% 2.0%
Depreciation............................................. 2.9% 2.5% 3.0% 2.5%
Purchased transportation................................. 20.3% 21.1% 20.0% 21.2%
Total operating expenses............................. 97.0% 96.5% 96.9% 97.2%
</TABLE>
Crouse's operating expenses as a percentage of operating revenue, or operating
ratio, for the third quarter of 1997, was adversely impacted in three areas.
Crouse incurred unusually high insurance and claims costs on accidents and cargo
damage in the quarter. Crouse operating and administrative personnel devoted
significant man-hours, primarily on an overtime basis, in training and preparing
for the transition to the Crouse's new computer system. The transition to the
new system is expected to be complete by year-end. Lastly, Crouse incurred
incrementally greater variable costs due to the different handling
characteristics of the small parcel shipments (UPS strike impact) as compared to
the freight Crouse typically handles.
In spite of the above factors, Crouse's operating ratio improved for the first
nine months of 1997 as compared to 1996. An increase in the proportion of LTL
tons and revenues of total tons and revenues resulted in the increases in
salaries, wages and employee benefits and depreciation and the decrease in
purchased transportation as a percent of revenues. The improvement in the year-
to-date 1997 operating ratio is the result of spreading the fixed component of
the Company's operating expenses over increased operating revenues.
FINANCIAL SERVICES
In the third quarter and first nine months of 1997, APR and UPAC financed
$31.4 million and $94.8 million, respectively, in insurance premiums at average
annual yields of 14.1% and 14.4%. These operations generated net operating
income of $208,000 and $869,000, on net finance charges, fees and other income
earned of $1.9 million and $6.2 million for the third quarter and first nine
months of 1997. These results compare to third quarter and first nine months of
1996 financings of $32.3 million and $82.4 million at average annual yields of
14.9% and 14.5%, which produced an operating loss of $14,000 and operating
income of $73,000 on net finance charges, fees and other income earned
of $2.1 million and $5.1 million for the third quarter and first nine months of
1996, respectively. The increases in premium financed, net finance charges,
fees and other income are primarily the result of the Company's acquisition of
UPAC effective March 29, 1996, operating income was positively impacted by the
integration of the administrative operations of UPAC and APR. Also,
contributing to the increased operating income was the impact of the Company's
new securitization agreement and an increase in gain recognized on receivables
sold through that agreement by the inclusion of UPAC receivables. See Note 4 -
Financing Agreements in the Notes to Consolidated Financial Statements. UPAC's
operating income for the third quarter of 1997 was adversely impacted by a high
level of provision for credit losses in the quarter.
OTHER
Primarily as a result of its utilization of cash and short-term investments
for the acquisition of UPAC and the stock repurchase program since the first
quarter of 1996, TransFinancial recorded a substantial decrease in interest
income for the periods ended September 30, 1997, from the corresponding period
of 1996. TransFinancial's effective tax rate decreased for the third quarter
and first nine months of 1997, to 45% from 50% and 46% for the same periods of
1996.
Outlook
The following statements are forward-looking statements, within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended, and as such
involve risks and uncertainties which are detailed below under the caption
"Forward-Looking Statements".
The Company's three-year strategic plan includes the goal of continuing the
growth of each of its business segments, and making the financial services
segment a more equal contributor to the Company's earnings per share. In the
transportation segment, the plan calls for the Company to continue to provide
and improve upon its already superior service to its customers in its primary
operating territory, while extending its operations throughout the Midwest. As
the Company makes the strategic investments necessary to support this expansion,
the Company intends to continue to improve the efficiency and effectiveness of
its existing base of operations.
The financial services segment will also focus on increasing its market
penetration in certain states with substantial population and industrial base.
The additional volumes of premium finance contracts is expected to be handled
within the Company's existing administrative operations without incurring
significant additional fixed costs.
In addition to the expansion of its existing operations in each of its
business segments, the Company continues to consider potential acquisitions
which would complement these operations.
Forward-Looking Statements
Certain statements contained in this Quarterly Report on Form 10-Q which are
not statements of historical fact constitute forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
including, without limitation, the statements specifically identified as
forward-looking statements in this Form 10-Q. In addition, certain statements
in future filings by the Company with the Securities and Exchange Commission, in
the Company's press releases, and in oral statements made by or with the
approval of an authorized executive officer of the Company which are not
statements of historical fact constitute forward-looking statements within the
meaning of the Act. Examples of forward-looking statements include, but are not
limited to (i) projections of revenues, income or loss, earnings or loss per
share, capital expenditures, the payment or non-payment of dividends,
capital structure and other financial items, (ii) statements of plans and
objectives of the Company or its management or Board of Directors, including
plans or objectives relating to the products or services of the Company, (iii)
statements of future economic performance, and (iv) statements of assumptions
underlying the statements described in (i), (ii) and (iii). These forward-
looking statements involve risks and uncertainties which may cause actual
results to differ materially from those anticipated in such statements. The
following discussion identifies certain important factors that could affect the
Company's actual results and actions and could cause such results or actions to
differ materially from any forward-looking statements made by or on behalf of
the Company that related to such results or actions. Other factors, which are
not identified herein, could also have such an effect.
Transportation
Certain specific factors which may affect the Company's transportation
operation include: increasing competition from other regional and national
carriers for freight in the Company's primary operating territory; increasing
price pressure; changes in fuel prices; labor matters; including changes in
labor costs, and other labor contract issues; and, environmental matters.
Financial Services
Certain specific factors which may affect the Company's financial services
operation include: the performance of financial markets and interest rates; the
performance of the insurance industry; increasing competition from other premium
finance companies and insurance carriers for finance business in the Company's
key operating states; the successful acquisition and integration of additional
premium finance operations or receivables portfolios; and, the inability to
obtain continued financing at a competitive cost of funds.
New Venture
As described below under the caption "Financial Condition," the Company has
acquired an equity interest in a start-up venture formed to develop, lease
and/or sell equipment utilizing a new technology for particle reduction. This
venture and technology are subject to risks and uncertainties in addition to
those generally applicable to the Company's operations described herein. These
additional risks and uncertainties include the efficacy and commercial viability
of the new technology, the ability of the venture to market the new technology,
the acceptance of such technology in the marketplace, the general tendency of
large corporations to be slow to change from known technology to emerging new
technology, the venture's reliance on third parties to manufacture the equipment
utilizing the technology, the ability of the venture to protect its proprietary
information in the new technology and potential future competition from third
parties developing equivalent or superior technology. As result of these and
other risks and uncertainties, the future results of operations of the venture
are difficult to predict, and such results may be materially better or worse
than expected or projected.
General Factors
Certain general factors which could affect any or all of the Company's
operations include: changes in general business and economic conditions; changes
in governmental regulation, and; tax changes. Expansion of these businesses
into new states or markets is substantially dependent on obtaining sufficient
business volumes from existing and new customers in these new markets at
compensatory rates.
The cautionary statements made pursuant to Section 21E of the Securities
Exchange Act of 1934, as amended, are made as of the date of this Report and are
subject to change. The cautionary statements set forth in this Report are not
intended to cover all of the factors that may affect the Company's businesses in
the future. Forward-looking information disseminated publicly by the Company
following the date of this Report may be subject to additional factors hereafter
published by the Company.
FINANCIAL CONDITION
The Company's financial condition remained strong at September 30, 1997 with
more than $8.5 million in cash and investments at the TransFinancial level, as
well as approximately $6.7 million in cash and investments held in the
discontinued operation. In addition, during the first nine months of 1997, the
Company has purchased $8.8 million of operating property and equipment, without
incurring any significant long term indebtedness. Crouse has additional
commitments to purchase operating property and equipment at a cost of
approximately $5 million for delivery through first quarter 1998. These
purchases are expected to be funded from operating cash flows and available cash
and investments.
A substantial portion of the capital required for UPAC's insurance premium
finance operations has been provided through the sale of undivided interests in
a designated pool of receivables on an ongoing basis under receivables
securitization agreements. The current securitization agreement, which matures
December 31, 1999, currently provides for the sale of a maximum of $50 million
of eligible receivables. As of September 30, 1997, $34.8 million of such
receivables had been securitized.
On June 26, 1995, the Company adopted a program to repurchase up to 10% of its
outstanding shares of common stock. During the second quarter of 1996 the
Company completed this program and expanded the program to include an additional
10% of its then outstanding shares. During the first nine months of 1997, the
Company repurchased 223,899 shares of common stock bringing the total shares
repurchased to 1,438,340, or 19.0% of outstanding shares before initiating the
program, at a total cost of $12,173,000. This program is being funded from
available cash and investments.
On June 26, 1997, the shareholders of the Company approved a 1-for-100 reverse
stock split followed by a 100-for-1 forward stock split. These stock splits
were effected on July 1, 1997. The result of this transaction was the
cancellation of about 107,000 shares of common stock held by holders of fewer
than 100 shares at a market price of $8.89 per share.
Effective July 31, 1997, the Company entered into a subscription agreement
with a start-up venture, pursuant to which TransFinancial committed to a $2.9
million capital contribution over two years in exchange for the exclusive lease
and/or sale rights to equipment produced by, and a controlling interest in, the
venture. The venture owns rights to a proprietary, new technology for particle
reduction. The venture intends to market equipment utilizing this technology to
companies which would benefit from the use of sub-micron materials in their
manufacturing processes. Capital contributions through September 30, 1997 total
approximately $500,000. The initial phase of this venture will focus on
continued research, product development, establishing sources of supply,
recruiting and training personnel, developing markets and contracting for
production. The Company expects this operation to incur initial operating
losses during the remainder of 1997, and in 1998, which may be significant in
relation to its consolidated results of operations.*
*This is a forward-looking statement which involves risks and uncertainties that
are detailed under the caption "Forward-Looking Statements".
PART II - OTHER INFORMATION
Item 1. Legal Proceedings Reference is made to Item 3 of the Registrant's
Annual Report on Form 10-K for the year ended December 31, 1996.
Item 2. Changes in Securities -- None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to vote of Security Holders - None
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3(b)* Restated By-Laws of the Registrant
19(a)* Report to Shareholders for the Third Quarter, 1997, dated
November 12, 1997.
27* Financial Data Schedule.
* Filed herewith.
(b) Reports on Form 8-K -- None
(SIGNATURE)
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TransFinancial Holdings, Inc.
Registrant
By: /s/Timothy P. O'Neil
Timothy P. O'Neil, President &
Chief Executive Officer
By: /s/ Mark A. Foltz
Mark A. Foltz
Vice President, Finance and
Secretary
Date: November 12, 1997
EXHIBIT INDEX
Assigned
Exhibit
Number Description of Exhibit
3(b) Restated By-Laws of the Registrant.
19(a) Report to Shareholders for the Third Quarter, 1997, dated November 12,
1997.
27 Financial Data Schedule.
TRANSFINANCIAL HOLDINGS, INC.
RESTATED BYLAWS
AS ADOPTED NOVEMBER 8, 1997
RESTATED BY LAWS
OF
TRANSFINANCIAL HOLDINGS, INC.
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of the Corporation
shall be located at such place in the State of Delaware as the
Board of Directors may from time to time authorize by duly
adopted resolution.
Section 2. Other Offices. The Corporation may also have offices at such
other places, either within or without the State of Delaware, as
the Board of Directors may from time to time determine or the
business of the Corporation may require.
ARTICLE II
STOCKHOLDERS
Section 1. Annual Meetings. An annual meeting of the stockholders of the
Corporation for the election of directors and the transaction of
such other business as may properly come before such meeting
shall be held on such date and at such time as the Board of
Directors shall specify, as set forth in such notice thereof.
Section 2. Special Meetings. Special meetings of the stockholders may be
called only by the Board of Directors.
Section 3. Place of Meeting. Meetings of the stockholders may be held at
any place within or without the State of Delaware as shall be
designated from time to time by the Board of Directors and
specified in the notice of meeting or a waiver of notice thereof.
Section 4. List of Stockholders. At least ten (10) days before every
meeting of stockholders, the Secretary shall prepare a complete
list of the stockholders entitled to vote at the meeting,
arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of
each stockholder. Such list shall be open to the examination of
any stockholder for any purpose germane to the meeting, during
ordinary business hours, for a period of at least ten (10) days
prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the
notice of meeting or, if not so specified, at the place where the
meeting is to be held. Such list shall also be produced and kept
open at the time and place of the meeting and shall be subject to
inspection by any stockholder during the whole time of the
meeting.
Section 5. Notice. Written notice of each meeting of stockholders stating
the place, day and hour of the meeting and, in case of a special
meeting, the purpose or purposes for which the meeting is called,
shall be given not less than ten (10) days nor more than sixty
(60) days before the date of the meeting, either personally or by
mail, to each stockholder of record entitled to vote at such
meeting. If mailed, notice of a stockholders' meeting shall be
deemed given when deposited in the United States mail, postage
prepaid, directed to the stockholder at his address as it appears
on the records of the Corporation.
Section 6. Waiver of Notice. Whenever notice is required to be given under
any provision of the General Corporation Law of Delaware, the
Certificate of Incorporation or these By-Laws, a written waiver
thereof, signed by the stockholder entitled to notice, whether
before or after the time stated therein, shall be deemed
equivalent to notice. Neither the business to be transacted at,
nor the purpose of any annual or special meeting of the
stockholders need be specified in any written waiver of notice
unless so required by the Certificate of Incorporation or these
By-Laws. Attendance of a stockholder at a meeting of
stockholders shall constitute a waiver of notice of such meeting,
except when the stockholder attends such meeting for the express
purpose of objecting at the beginning of the meeting to the
transaction of any business because the meeting is not lawfully
called or convened.
Section 7. Quorum. Except as otherwise provided by law or by the
Certificate of Incorporation, at all meetings of the stockholders
of this Corporation, the holders of a majority of the outstanding
shares entitled to vote thereat present in person or by proxy
shall constitute a quorum. If a quorum is not present or
represented at such meeting, the affirmative vote of a majority
of shares represented at any meeting, in person or by proxy, may
adjourn any meeting of stockholders until a quorum is present.
In all matters other than the election of directors, every
decision of a majority of shares of stock entitled to vote on the
subject matter and represented in person or by proxy at a meeting
at which a quorum is present shall be valid as an act of the
shareholders unless a larger vote is required by the Certificate
of Incorporation, these By-Laws or the laws of the State of
Delaware then in effect. Directors shall be elected by a
plurality of the votes of the shares present in person or by
proxy at the meeting and entitled to vote on the election of
directors.
Section 8. Adjourned Meetings. Any stockholders' meeting may be adjourned
from time to time by the Chairman of such meeting until its
business is completed, and notice need not be given of the
adjourned meeting if the time and place thereof are announced at
the meeting at which the adjournment is taken; provided, however,
that if the adjournment is for more than thirty (30) days, or if
after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be
given to each stockholder of record entitled to vote thereat. At
any adjourned meeting the Corporation may transact any business
which might have been transacted at the original meeting.
Section 9. Proxies. Each stockholder entitled to vote at a meeting of
stockholders or to express consent or dissent to corporate action
in writing without a meeting may authorize another person or
persons to act for him by proxy, but no such proxy shall be voted
or acted upon after three (3) years from its date, unless the
proxy provides for a longer period, and then only within the
period specified.
Section 10. Elections of Directors. All elections of directors shall be by
written ballot.
Section 11. Action by Consent.
(a) Unless otherwise provided in the certificate of
incorporation, any action required to be taken at any annual or
special meeting of stockholders of the corporation, or any action
that may be taken at any annual or special meeting of such
stockholders, may be taken without a meeting, without prior
notice, and without a vote if a consent or consents in writing,
setting forth the action so taken, shall be signed by the holders
of outstanding stock having not less than the minimum number of
votes that would be necessary to authorize or take such action at
a meeting at which all shares entitled to vote thereon were
present and voted.
(b) In order that the corporation may determine the stockholders
entitled to consent to corporate action in writing without a
meeting, the Board of Directors may fix a record date, which
record date shall not precede the date upon which the resolution
fixing the record date is adopted by the Board of Directors, and
which date shall not be more than ten (10) days after the date
upon which the resolution fixing the record date is adopted by
the Board of Directors. Any stockholder of record seeking to
have the stockholders authorize or take corporate action by
written consent shall, by written notice to the Secretary,
request the Board of Directors to fix a record date. The Board
of Directors shall promptly, but in all events, within ten (10)
days after the date on which such request is received, adopt a
resolution fixing the record date. If no record date has been
fixed by the Board of Directors within ten (10) days of the date
on which such a request is received, the record date for
determining stockholders entitled to consent to corporate action
in writing without a meeting, when no prior action by the Board
of Directors is required by applicable law, shall be the first
date on which a signed written consent setting forth the action
taken or proposed to be taken is delivered to the corporation by
delivery to its registered office in the State of Delaware, its
principal place of business or an officer or agent of the
corporation having custody of the book in which proceedings of
meetings of stockholders are recorded, to the attention of the
Secretary of the corporation. Delivery shall be by hand or by
certified or registered mail, return receipt requested. If no
record date has been fixed by the Board of Directors and prior
action by the Board of Directors is required by applicable law,
the record date for determining stockholders entitled to consent
to corporate action in writing without a meeting shall be at the
close of business on the date on which the Board of Directors
adopts the resolution taking such prior action.
(c) In the event of the delivery to the corporation of a written
consent or consents purporting to authorize or take corporate
action and/or any related revocation or revocations, the
Secretary of the corporation shall provide for the safekeeping of
such consents and revocations and shall as soon as practicable
thereafter conduct such reasonable investigation as the Secretary
deems necessary or appropriate for the purpose of ascertaining
the validity of such consents and revocations and all matters
incident thereto, including, without limitation, whether the
holders of shares having the requisite voting power to authorize
or take the action specified in the consents have given consents.
Alternatively, the Board of Directors in its sole discretion may
appoint one or more inspectors of elections to conduct such
investigation.
(d) Every written consent shall bear the date of signature of
each stockholder who signs the consent and no written consent
shall be effective to take the corporate action referred to
therein unless, within sixty (60) days of the earliest dated
written consent received in the manner provided in Section 11(b),
a written consent or consents signed by a sufficient number of
holders to take such action are delivered to the corporation in
the manner provided in Section 11(b).
Section 12. Inspectors of Election. The Board of Directors, the Chairman of
the Board or the President shall, in advance of any meeting of
stockholders, appoint one or more inspectors to act at the
meeting and make a written report thereof, and may designate one
or more persons as alternate inspectors to replace any inspector
who fails to act. If no inspector or alternate is able to act at
a meeting of stockholders, the person presiding at the meeting
shall appoint one or more inspectors to act at the meeting. Each
inspector before entering upon the discharge of such inspector's
duties, shall take and sign an oath faithfully to execute the
duties of inspector with strict impartiality and according to the
best of his or her ability. At the meeting, the inspector or
inspectors shall: (a) ascertain the number of shares outstanding
and the voting power of each, (b) determine the shares
represented at the meeting and the validity of proxies and
ballots, (c) count all votes and ballots, (d) determine and
retain for a reasonable period a record of the disposition of any
challenges made to any determination by the inspectors and (e)
certify the determination of the number of shares represented at
the meeting, and the count of all votes and ballots. The
inspectors may appoint or retain other persons or entities to
assist them in the performance of their duties. The date and
time of the opening and the closing of the polls for each matter
upon which the stockholders will vote at a meeting shall be
announced at the meeting. No ballot, proxies or votes, nor any
revocations thereof or changes thereto, shall be accepted by the
inspectors after the closing of the polls unless the Delaware
Court of Chancery, or any other court having jurisdiction of the
matter, upon application by a stockholder shall determine
otherwise.
Section 13. Advance Notice of Stockholder Nominations and Stockholder
Proposals.
(a) Only persons who are nominated in accordance with the
following procedures shall be eligible for election as directors
of the corporation at any meeting of stockholders at which
directors are to be elected. Nominations of persons for election
to the Board of Directors may be made at any such meeting of
stockholders (i) by or at the direction of the Board of Directors
(or any duly authorized committee thereof) or (ii) by any
stockholder of record of the corporation who is entitled to vote
in the election of directors at such meeting and who complies
with the notice procedures set forth in Section 13(b).
(b) If a stockholder proposes to nominate one or more candidates
for election as directors at a meeting of stockholders at which
directors are to be elected, the stockholder must give timely
notice thereof in proper written form to the Secretary of the
corporation, in addition to complying with any other applicable
requirements. To be timely, the stockholder's notice must be
delivered to the Secretary at the principal executive offices of
the corporation not less than sixty (60) days prior to the date
scheduled for such meeting; provided, however, that if notice or
public announcement of the scheduled date of the meeting is not
given or made at least seventy (70) days prior to the date
scheduled for the meeting, such stockholder's notice must be so
delivered to the Secretary not more than ten (10) days following
the day on which such notice of meeting was mailed or such public
announcement was made, whichever is earlier. In no event shall
the postponement, deferral or adjournment of a stockholders'
meeting commence a new time period for the giving of notice by a
stockholder as described above. For purposes of this Section,
"public announcement" shall mean disclosure in a press release
reported by the Dow Jones News Service, Associated Press or
comparable national news service or in a document publicly filed
by the corporation with the Securities and Exchange Commission
pursuant to Section 13, 14 or 15(d) of the Exchange Act.
To be in proper written form, a stockholder's notice to the
Secretary must set forth (i) as to each person whom the
stockholder proposes to nominate for election as a director (A)
the name, age, business address and residence address of the
person, (B) the principal occupation or employment of the person,
(C) the class and number of shares of capital stock of the
corporation that are owned beneficially and owned of record by
the person and (D) any other information concerning the person
that would be required to be disclosed in a proxy statement or
other filings in connection with the solicitation of proxies for
the election of such person as a director under Section 14 of the
Securities Exchange Act of 1934, as amended from time to time
(the "Exchange Act"), and the rules and regulations promulgated
thereunder; and (ii) as to the stockholder giving the notice (A)
the name and address, as they appear on the corporation's books,
of such stockholder (B) the name and address of the beneficial
owner, if any, on whose behalf the nomination(s) are made, (C)
the class and number of shares of capital stock of the
corporation that are owned beneficially and owned of record by
such stockholder and any such beneficial owner, (D) a description
of all arrangements or understandings between such stockholder or
beneficial owner and each proposed nominee or any other person or
persons (including their names) pursuant to which the
nomination(s) are to be made by such stockholder and (E) any
other information relating to such stockholder or beneficial
owner that would be required to be disclosed in a proxy statement
or other filings required to be made in connection with
solicitations of proxies for the election of directors pursuant
to Section 14 of he Exchange Act and the rules and regulations
promulgated thereunder. Such notice must be accompanied by a
written consent of each proposed nominee to being named as a
nominee and to serve as a director if elected.
(c) No business may be transacted at an annual meeting of
stockholders, other than business that is either (i) specified in
the notice of meeting (or any supplement thereto) given by or at
the direction of the Board of Directors (or any duly authorized
committee thereof), (ii) otherwise properly brought before the
annual meeting by or at the direction of the Board of Directors
(or any duly authorized committee thereof) or (iii) otherwise
properly brought before the annual meeting by any stockholder of
record of the corporation who is entitled to vote at such meeting
and who complies with the notice procedures set forth in Section
13(d). Any business to be brought before the annual meeting by
any stockholder must also be a proper matter for stockholder
action.
(d) If a stockholder proposes to bring business before an annual
meeting of stockholders, the stockholder must give timely notice
thereof in proper written form to the Secretary of the
corporation, in addition to complying with any other applicable
requirements. To be timely, a stockholder's notice must be
delivered to the Secretary at the principal executive offices of
the corporation within the period specified in Section 13(b)
hereof. In no event shall the postponement, deferral or
adjournment of a stockholders' meeting commence a new time period
for the giving of notice by a stockholder.
To be in proper written form, a stockholder's notice to the
Secretary must set forth (i) a brief description of the proposal
desired to be brought before the annual meeting and the reasons
for conducting such business at the annual meeting, (ii) the name
and address, as they appear on the corporation's books, of such
stockholder, (iii) the name and address of the beneficial owner,
if any, on whose behalf the proposal is made, (iv) the class and
number of shares of capital stock of the corporation that are
owned beneficially and owned of record by such stockholder and
any such beneficial owner, (v) a description of all arrangements
or understandings between such stockholder or beneficial owner
and any other person or persons (including their names) in
connection with the proposal of such business by such
stockholder, (vi) a description of any material financial or
other interest of such stockholder or beneficial owners in such
proposal and (vii) any other information that would be required
to be disclosed in a proxy statement soliciting proxies for
approval of the proposal pursuant to Section 14 of the Exchange
Act and the rules and regulations promulgated thereunder.
(e) The Board of Directors, or a designated committee thereof,
may reject any stockholder's nomination or stockholder's proposal
which is not timely made in accordance with the provisions of
this Section 13. If the Board of Directors, or a designated
committee thereof, determines that the information provided in a
stockholder's notice does not comply with the requirements of
this Section 13 in any material respect, the Secretary of the
corporation shall notify the stockholder of the deficiency. The
stockholder shall have an opportunity to cure the deficiency by
providing additional information to the Secretary within five (5)
days from the date such deficiency notice is given to the
stockholder, or such shorter time as may reasonably be deemed
appropriate by the Board or committee. If the deficiency is not
cured within such period, or if the Board of Directors or such
committee determines that the additional information provided by
the stockholder, together with the information previously
provided, does not satisfy the requirements of this Section 13 in
any material respect, then the Board of Directors or committee
may reject such stockholder's notice.
(f) Notwithstanding the procedures set forth in Section 13(e)
hereof, if the Board of Directors or any committee thereof does
not make a determination as to whether a stockholder's notice
complies with the provisions of this Section 13, the chairman of
the meeting shall make the determination and declare at the
meeting whether the stockholder has so complied. If the chairman
determines that the stockholder has not so complied, then unless
the chairman in his or her sole and absolute discretion waives
such noncompliance, the chairman shall declare at the meeting
that the stockholder's nomination or proposal was not properly
made and the defective nomination or stockholder proposal shall
be disregarded.
Section 14. Chairman of Meetings. The Chairman of the Board or, in his
absence, the President shall preside at all meetings of the
stockholders. In the absence of both the Chairman of the Board
and the President, a majority of the members of the Board of
Directors present in person at such meeting may appoint any other
officer or director to act as Chairman of the meeting.
ARTICLE III
BOARD OF DIRECTORS
Section 1. Power and Authority. The property, business and affairs of the
Corporation shall be under the supervision and the direction of
the Board of Directors. Such direction and supervision will not
infringe on management's authority to manage the Corporation day-
to-day. The Board of Directors may exercise all such powers of
the Corporation and do all such lawful acts and things as are not
by statute, or by the Certificate of Incorporation, or by these
By-Laws directed or required to be exercised or done by the
stockholders.
Section 2. Number and Term. The number of directors which shall constitute
the Board of Directors shall be determined from time to time by
resolution of the Board of Directors, provided that the total
number of directors shall not be less than six (6) or more than
twelve (12) director(s); and provided further that no reduction
by the Board of Directors in the number of directors shall affect
the term of any incumbent director. The directors shall be
elected at the annual meeting of stockholders, except as provided
herein. Each director so elected shall hold office until the
next succeeding annual meeting of stockholders and until his
successor is duly elected and qualified, or until his earlier
death, resignation or removal.
Section 3. Vacancies. Vacancies and newly created directorships resulting
from any increase in the authorized number of directors may be
filled by a majority of the directors then in office, although
less than a quorum, or by a sole remaining director; or any such
vacancies or newly created directorships may be filled by the
stockholders at any meeting. Any directors so chosen to fill
such vacancies or newly created directorships shall hold office
until the next election of directors and until their successors
are elected and qualified, or until their earlier death,
resignation or removal.
Section 4. Meetings. The first meeting of each newly elected Board, for
which no notice shall be necessary, shall be held immediately
following each annual meeting of the stockholders of the
Corporation or any adjournment thereof, at the place of such
annual meeting, or at such place and time as a majority of the
members of the newly elected Board who are then present shall
determine. All other meetings of the Board of Directors may be
held within or without the State of Delaware as may be provided
in the resolution or notice calling such meeting. Regular
meetings of the Board of Directors shall be held at such times as
the Board of Directors may from time to time provide and without
any notice other than the resolution or action providing
therefor. Special meetings of the Board of Directors shall be
held at any time upon the call of the Chairman of the Board; or
in the absence or disability of the Chairman of the Board, the
Vice Chairman or President; or by the Chairman of the Board or
the Corporate Secretary upon the written request of any two (2)
members of the Board. A meeting of a committee shall be held at
any time upon the call of the Chairman of a Committee, or the
Chairman of the Board, or the Chairman or Corporate Secretary
upon written request of any two (2) members of a Committee.
Section 5. Notice Of Special and Committee Meetings. Notice of all special
meetings of the Board of Directors shall be given to each
director, which notice shall state the time and place of each
meeting. Such notice need not include a statement of the
business to be transacted at, or the purpose of, any such
meeting. Like notice of all meetings of the committees of the
Board of Directors shall be given to each member of the
appropriate committee. Such notice shall be mailed, postage
prepaid, at least five (5) days before such meeting, addressed to
the last known residence or place of business of each director
or, at least twenty-four (24) hours before such meeting, shall be
sent to him or her at such place by telegraph, cable, telecopier
or similar means or personally served on him or her in person or
by telephone. The individual(s) calling a meeting shall give
notice, or cause notice to be given, for such meeting.
Section 6. Waiver of Notice. A written waiver of notice, signed by the
director entitled to notice, whether before or after the time
stated therein, shall be deemed equivalent to notice. Neither
the business to be transacted at, nor the purpose of any annual
or special meeting need be specified in any written waiver of
notice unless so required by the Certificate of Incorporation or
these By-Laws. Attendance of a director at any meeting, whether
regular or special, shall constitute a waiver of notice of such
meeting except where a director attends a meeting for the express
purpose of objecting at the beginning of the meeting to the
transaction of any business because the meeting is not lawfully
called or convened.
Section 7. Quorum. A majority of the directors then in office (but in no
event less than one-third of the total number of directors
authorized by the Board pursuant to Article III, Section 2) shall
constitute a quorum for the transaction of business, and the act
of a majority of the directors present at a meeting at which a
quorum shall be present shall be an act of the Board of Directors
except as may be otherwise specifically required by law or the
Certificate of Incorporation or these By-Laws; and if less than a
quorum may be present at any meeting, those present may adjourn
from time to time to another time and place until a quorum shall
be present, without notice other than announcement at the meeting
of such other time and place.
Section 8. Telephone Meeting. Members of the Board of Directors or any
committee designated by the Board of Directors may participate in
meetings by means of conference telephone or similar
communications equipment whereby all participants can hear each
other and such participation shall constitute presence in person
at the meeting.
Section 9. Committees of Directors Designated by Board. The Board of
Directors may by resolution or resolutions adopted by a majority
of the whole Board of Directors designate two or more directors
to constitute an executive committee, audit committee,
compensation committee, nominating committee, or such other
committee or committees as the Board of Directors may from time
to time deem advisable. Except to the extent restricted by law,
any said committee shall have and may exercise all of the
authority of the Board of Directors in the management of the
Corporation to the extent provided in said resolutions and may
have power to authorize the seal of the Corporation to be affixed
to all papers which may require it. The committees shall keep
regular minutes of their proceedings and report the same to the
Board when required. The Board may designate one or more
directors as alternate members of any committee, who may replace
any absent or disqualified member at any meeting of the
committee. In the absence or disqualification of a member of a
committee, the member or members present at any meeting and not
disqualified from voting, whether or not such member or members
constitute a quorum, may unanimously appoint another member of
the Board of Directors to act at the meeting in the place of any
absent or disqualified member.
Section 10. Committees of Directors Designated by Chairman. The Chairman of
the Board of Directors may designate such advisory committees
from time to time as the Chairman of the Board of Directors deems
necessary and proper, to perform such duties as may be determined
by such chairman at the time of their designation or as may be
modified thereafter by such chairman; provided, however, that any
such advisory committee or committees shall have and may exercise
only the power to recommend action to the Board of Directors.
Each advisory committee shall consist of two or more individuals
(with such alternates, if any, as may be deemed desirable)
selected by the Chairman of the Board of Directors, who may but
need not be members of the Board of Directors.
Section 11. Action by Consent. Unless otherwise restricted by the
Certificate of Incorporation, any action which is required or
permitted to be taken at a meeting of the directors or of any
committee thereof may be taken without a meeting if consents in
writing, setting forth the action so taken, are signed by all
members of the Board or of the committee, as the case may be.
Such consents shall have the same force and effect as a unanimous
vote at a meeting duly held. The Secretary shall file such
consents with the minutes of the meetings of the Board of
Directors or the committee, as the case may be.
Section 12. Compensation of Directors. Unless otherwise restricted by law or
by the Certificate of Incorporation, directors, as such, shall
receive such compensation, if any, for their services as the
Board shall, from time to time, determine; provided that nothing
herein contained shall be construed to preclude any director from
serving the Corporation in any other capacity and receiving
compensation therefor.
Section 13. Chairman of the Board. The Chairman of the Board, if any, may
sign certificates for shares of the Corporation and shall perform
such other duties and have such other responsibilities as may,
from time to time, be determined by the Board of Directors.
Section 14. Vice-Chairman of the Board. The Vice-Chairman of the Board, if
any, shall exercise and perform such duties and have such other
responsibilities as may be from time to time assigned to him by
the Board of Directors or the Chairman of the Board.
Section 15. Removal of Directors. At a meeting called expressly for that
purpose, the entire Board of Directors or any member thereof may
be removed, with or without cause, by the vote of the holders of
a majority of the shares then entitled to vote at an election of
directors.
ARTICLE IV
OFFICERS
Section 1. Number. The officers of this Corporation shall be elected by the
Board of Directors and shall consist of a President and a
Secretary and such other or additional officers (including,
without limitation, one or more Vice Presidents, a Treasurer, a
Controller, and one or more Assistant Treasurers, Assistant
Secretaries or Assistant Controllers) as the Board of Directors
may designate. Unless otherwise restricted by law, the
Certificate of Incorporation or these By-Laws, any two or more
offices, except those of President and Vice-President, may be
held by one and the same person.
Section 2. Qualifications. The officers need not be members of the Board of
Directors and they need not be residents of the State of
Delaware.
Section 3. Election of Officers. Officers shall be elected by the Board at
its first meeting after the election of directors at the annual
meeting of stockholders and at such other times as deemed
appropriate or necessary by the Board. All officers shall serve
at the will of the Board or until their successors are elected
and may be removed either with or without cause by the Board of
Directors.
Section 4. Compensation. The compensation of all officers of the
Corporation shall be fixed by or in the manner prescribed by the
Board of Directors.
Section 5. Expense Reimbursement. The Corporation may adopt, from time to
time, a policy with respect to reimbursement of expenses incurred
on behalf of the Corporation by its officers and/or employees.
Reimbursement of such expenses shall be in accordance with the
requirements imposed by the Internal Revenue Code for
substantiation of such expenses as deductible business expenses
to the Corporation.
ARTICLE V
DUTIES OF OFFICERS
Section 1. President. The President, in the absence of the Chairman of the
Board and the Vice-Chairman of the Board, shall preside at all
meetings of the stockholders and all meetings of the Board of
Directors; the President may sign certificates for shares of the
Corporation. Subject to the supervision and direction of the
Board of Directors, the President shall have and exercise direct
charge of and general supervision over the day-to-day business
and affairs of the Corporation, and he shall perform such other
duties as may be delegated to him by the Board of Directors, the
Chairman of the Board and Vice- Chairman of the Board. The
President may sign all notes, agreements or other instruments in
writing made and entered into for or on behalf of the
Corporation, except in cases where the signing thereof shall be
expressly delegated by the Board of Directors or by these By-Laws
to some other officer or agent of the Corporation, or shall be
required by law to be otherwise signed or executed; and in
general the President shall perform all duties incident to the
office of President.
Section 2. Vice Presidents. The Vice Presidents, if any, in the order
designated by the Board of Directors, shall exercise the
functions of the President during the absence or disability of
the President. Each Vice President shall have such powers and
designated titles, if any, and discharge such duties as may be
assigned by the Board of Directors, and shall perform such other
duties as may be delegated by the President.
Section 3. Corporate Secretary. The Corporate Secretary shall attend all
meetings of the Board of Directors and all meetings of the
stockholders, record all the proceedings of the meetings of the
Corporation and of the Board of Directors in a book to be kept
for that purpose and perform like duties for the standing
committees when required. The Corporate Secretary shall give, or
cause to be given, notice of all meetings of the stockholders and
of special meetings of the Board of Directors and shall perform
such other duties as are usually incident to the office of the
secretary of a Corporation, as may be prescribed by the Board of
Directors or President. The Corporate Secretary shall keep in
safe custody the seal of the Corporation and affix the same to
any instrument requiring it and, when so affixed, it shall be
attested by his or her signature.
Section 4. Assistant Secretaries. The Assistant Secretary or, if there be
more than one (1), the Assistant Secretaries shall, in the
absence or disability of the Corporate Secretary, perform the
duties and exercise the powers of the Corporate Secretary and
shall perform such other duties as may be assigned by the
President.
Section 5. Treasurer. The Treasurer, if any, shall have the custody of all
moneys and securities of the Corporation and shall keep regular
books of account. The Treasurer shall disburse the funds of the
Corporation in payment of the just demands against the
Corporation, taking vouchers for such disbursements, and shall
render to the President and the Board of Directors, from time to
time, as may be required, an account of all transactions as
Treasurer and of the financial condition of the Corporation and
shall perform such other duties as may be required by the Board
of Directors or the President.
Section 6. Assistant Treasurers. The Assistant Treasurers, in the order
designated by the President shall, in the absence or disability
of the Treasurer, perform the duties and exercise the powers of
the Treasurer, and such other duties as may be required by the
President.
ARTICLE VI
STOCK CERTIFICATES AND RECORD DATES
Section 1. Stock Certificates. Certificates representing shares of the
Corporation shall be in such form as may be determined by the
Board of Directors. Such certificates shall be signed by the
Chairman of the Board of Directors or Vice Chairman of the Board,
if any, or the President or a Vice President, and by the
Treasurer or an Assistant Treasurer, or the Secretary or an
Assistant Secretary. Any or all of the signatures on a
certificate may be a facsimile. In case any officer, transfer
agent or registrar who has signed or whose facsimile signature
has been placed upon a certificate shall have ceased to be such
officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect
as if he or she were such officer, transfer agent or registrar at
the date of issue.
Section 2. Lost Certificates. The Board of Directors may authorize the
issuance of a new certificate or certificates of stock in place
of any certificate theretofore issued by the Corporation and
alleged to have been lost, stolen or destroyed, upon the making
of an affidavit of that fact by the person claiming that the
certificate of stock has been lost, stolen or destroyed. When
authorizing such issue of a new certificate or certificates, the
Corporation may, in its discretion and as a condition precedent
to the issuance thereof, require the owner of such lost, stolen
or destroyed certificate or certificates, or his or her legal
representative, to give the Corporation a bond in such sum as it
may direct sufficient to indemnify it against any claim that may
be made against the Corporation on account of the alleged loss,
theft or destruction of any such certificate or the issuance of
such new certificate.
Section 3. Transfer of Stock. The shares of stock of the Corporation shall
be transferable only upon its books by the registered holders
thereof in person or by their duly authorized attorneys or legal
representatives, upon surrender and cancellation of certificates
for a like or greater number of shares, with an assignment or
power of transfer endorsed thereon or delivered therewith, duly
executed, and with such proof of the authenticity of the
signature and of authority to transfer, and of payment of
transfer taxes, as the Corporation or its agents may require.
Except as otherwise expressly provided by the statutes of the
State of Delaware, the Corporation shall be entitled to treat the
holder of record of any share or shares of stock as the absolute
owner thereof for all purposes and, accordingly, shall not be
bound to recognize any legal, equitable or other claim to or
interest in such share or shares on the part of any other person
whether or not it shall have express or other notice thereof.
Section 4. Fixing the Record Date. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or
entitled to receive payment of any dividend or other distribution
or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the Board of Directors may
fix in advance a record date, which shall not be more than sixty
nor less than ten days before the date of such meeting, nor more
than sixty days prior to any other action. A determination of
stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a
new record date for the adjourned meeting.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Dividends. Subject to the provisions of statute and the
Certificate of Incorporation, dividends upon the shares of
capital stock of the Corporation may be declared by the Board of
Directors at any regular or special meeting. Dividends may be
paid in cash, in property or in shares of capital stock of the
Corporation, unless otherwise provided by statute or the
Certificate of Incorporation.
Section 2. Reserves. Before payment of any dividend, there may be set aside
out of any funds of the Corporation available for dividends such
sum or sums as the Board of Directors may from time to time, in
its absolute discretion, think proper as a reserve or reserves to
meet contingencies, or for equalizing dividends, or for repairing
or maintaining any property of the Corporation or for such other
purpose as the Board of Directors may think conducive to the
interests of the Corporation. The Board of Directors may modify
or abolish any such reserves in the manner in which they were
created.
Section 3. Corporate Seal. The corporate seal shall have inscribed thereon
the name of the Corporation, the year of its organization, and
the words "Corporate Seal, Delaware". Said seal may be used by
causing it or a facsimile thereof to be impressed or affixed or
reproduced or otherwise.
Section 4. Fiscal Year. The fiscal year of the Corporation shall end on the
last day of December of each year, unless and until the same
shall be modified by resolution of the Board of Directors.
Section 5. Checks, Notes, Drafts, etc. All checks, notes, drafts or other
orders for the payment of money of the Corporation may be signed,
endorsed or accepted in the name of the Corporation by such
officer, officers, person or persons as from time to time may be
designated by the Board of Directors or any officer or officers
authorized by the Board of Directors to make such designations.
Section 6. Execution of Contracts, Deeds, etc. The Board of Directors may
authorize any director or directors, officer or officers, agent
or agents, to enter into or execute and deliver in the name and
on behalf of the Corporation any and all deeds, bonds, mortgages,
contracts and other obligations or instruments, and such
authority may be general or confined to specific instances.
Section 7. Voting of Stock in Other Corporations. Unless otherwise provided
by resolution of the Board of Directors, the President from time
to time may (or may appoint one or more attorneys or agents to)
cast the votes which the Corporation may be entitled to cast as a
stockholder or otherwise in any other Corporation, any of whose
shares or securities may be held by the Corporation, at meetings
of the holders of the shares or other securities of such other
Corporation. If one or more attorneys or agents are appointed,
the President may instruct the person or persons so appointed as
to the manner of casting such votes or giving such consent. The
President may, or may instruct the attorneys or agents appointed
to, execute or cause to be executed in the name and on behalf of
the Corporation and under its seal or otherwise, such written
proxies, consents, waivers, or other instruments as may be
necessary or proper in the circumstances.
ARTICLE VIII
INDEMNIFICATION
Section 1. The Corporation shall indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending,
or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative (other than an action
by or in the right of the Corporation) by reason of the fact that
he is or was a director or officer of the Corporation, or is or
was serving at the request of the Corporation as a director,
officer, employee, or agent of another Corporation, partnership,
joint venture, trust, or other enterprise, against expenses
(including attorneys' fees), judgments, fines, and amounts paid
in settlement actually and reasonably incurred by him in
connection with such action, suit, or proceeding if he acted in
good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful. The termination of
any action, suit, or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere, or its equivalent,
shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the
Corporation, and with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was
unlawful.
Section 2. The Corporation shall indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending,
or completed action or suit by or in the right of the Corporation
to procure a judgment in its favor by reason of the fact that he
is or was a director or officer of the Corporation, or is or was
serving at the request of the Corporation as a director, officer,
employee, or agent of another Corporation, partnership, joint
venture, trust, or other enterprise against expenses (including
attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit
if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Corporation
and except that no indemnification shall be made in respect of
any claim, issue, or matter as to which such person shall have
been adjudged to be liable for negligence or misconduct in the
performance of his duty to the Corporation unless and only to the
extent that a court shall determine upon application that,
despite the adjudication of liability, but in view of all the
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall
deem proper.
Section 3. Notwithstanding the provisions of Sections 1 and 2 of this
Article VIII, to the extent that any person specified in Sections
1 or 2 has been successful on the merits or otherwise in defense
of any action, suit or proceeding referred to in Sections 1 or 2,
or in defense of any claim, issue or matter therein, such person
shall be indemnified by the Corporation against all expenses
(including attorneys' fees), actually or reasonably incurred by
such person in connection therewith.
Section 4. Reasonable expenses (including attorneys' fees) incurred by any
person specified in Sections 1 and 2 of this Article VIII in
defending any civil, criminal, administrative or investigative
action, suit or proceeding shall be paid by the Corporation in
advance of the final disposition of such action, suit or
proceeding upon receipt by the Corporation of any undertaking by
or on behalf of such person to repay such amount if it shall
ultimately be determined that such person is not entitled to be
indemnified by the Corporation as provided in this Article VIII.
Section 5. The indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those seeking
indemnification may be entitled under any law, agreement, vote of
stockholders or disinterested directors or otherwise, both as to
action in his official capacity and as to action in another
capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee, or
agent and shall inure to the benefit of the heirs, executors, and
administrators of such person.
Section 6. All rights provided any person by this Article VIII shall be
contract rights. No amendment, alteration, addition, change or
repeal of this Article VIII, or any other provisions of the
Certificate of Incorporation or of the By-Laws shall in any way
impair or reduce the rights to indemnification or advancement of
expenses provided by this Article VIII to such person with
respect to any acts or omissions of such person occurring prior
to the time of such amendment, alteration, addition, change or
repeal.
Section 7. Notwithstanding the provisions of Sections 1, 2 and 4 of this
Article VIII, if the Delaware General Corporation Law is amended
to permit greater rights to indemnification or advancement of
expenses than that provided in this Article VIII, then the
persons specified in Sections 1, 2 or 4 shall be granted such
greater rights to the full extent permitted by the Delaware
General Corporation Law as so amended.
Section 8. In the event that any part of the Article VIII shall be found in
any action, suit or proceeding to be invalid or ineffective, the
validity and the effect of the remaining parts shall not be
affected and the Corporation shall indemnify the persons
specified in Sections 1 and 2 to the full extent required by the
remaining parts of this Article VIII and to the full extent
permitted by the Delaware General Corporation Law.
ARTICLE IX
AMENDMENTS
Section 1. Amendments. The Board of Directors shall have the power to make,
alter or repeal the By-Laws of the Corporation subject to the
power of the stockholders to alter or repeal the By-Laws made or
altered by the Board of Directors.
Corporate Secretary
TRANSFINANCIAL HOLDINGS, INC.
THIRD QUARTER 1997
REPORT TO SHAREHOLDERS
Our third quarter highlights included continued improvement in profitability
compared to 1996 by Crouse Cartage Company ("Crouse"), TransFinancial's general
commodities motor carrier, and Universal Premium Acceptance Corporation
("UPAC"), TransFinancial's insurance premium finance operation. For the third
quarter of 1997, TransFinancial increased net income to $569,000, or $0.09 per
share, on operating revenues of $35.2 million, compared to net income of
$505,000, or $0.08 per share on operating revenues of $30.0 million for the
third quarter of 1996.
Crouse earned operating income of $989,000 on revenues of $33.3 million in third
quarter 1997, compared to operating income of $981,000 on revenues of $27.9
million for third quarter 1996. This improvement was principally the result of
a 15% increase in less-than-truckload ("LTL") tons handled. In addition, Crouse
achieved a 7.0% increase in revenue yield on LTL freight through the combination
of a reduction in average shipment size due to the Teamster strike against UPS,
a general rate increase, negotiated increases in contracted rates and the
implementation of fuel surcharges. These improvements in revenues were offset
in part by increased insurance and claims costs due to accidents and cargo
damage during the quarter, increased overtime pay incurred in connection with
the transition to a new computer system and increased variable costs required to
handle the volume of small parcel shipments moved for customers during the
recent strike against UPS.
UPAC reported operating income of $208,000 on net finance charges, fees and
other income earned of $1.9 million, compared to an operating loss of $14,000 on
net finance charges, fees and other income earned of $2.1 for the third quarter
of 1996. The primary factors contributing to the improved profitability were
increased gain recognized on the sale of receivables through the new
securitization agreement and the integrated administrative operations.
We believe each of our operating segments made important progress toward its
strategic goals during the third quarter. Crouse continued to develop and
increase its operations in its expansion markets while meeting the challenge of
handling a substantial increase in small parcel shipments from existing
customers during the recent Teamster strike against UPS. UPAC maintained its
focus on providing superior customer service and increasing the productivity and
efficiency of its operations.
Effective July 31, 1997, we acquired the exclusive lease and/or sale rights to
equipment produced by, and a controlling interest in, a start-up venture in
exchange for a $2.9 million capital contribution over two years. The venture
owns rights to a proprietary, new technology for particle reduction. The
venture intends to market equipment utilizing this technology to companies which
would benefit from the use of sub-micron materials in their manufacturing
processes. Capital contributions through September 30, 1997 total approximately
$500,000. The initial phase of this venture will focus on continued research ,
product development, establishing sources of supply, recruiting and training
personnel, developing markets and contracting for production. We expect this
operation to incur initial operating losses during the remainder of 1997, and in
1998, which may be significant in relation to consolidated results of
operations.
TransFinancial continues to maintain a strong balance sheet with cash and
investments of $8.5 million, excluding an additional $6.7 million included in
net assets of discontinued operations, and book value of $12.14 per share at
September 30, 1997. TransFinancial acquired 224,000 shares in the first nine
months of 1997 under its stock repurchase program.
Timothy P. O'Neil William D. Cox
President Chairman
November 12, 1997
"Safe Harbor" Statement under Private Securities Litigation Reform Act of 1995
The Company's 1997 outlook and all other statements in this report other than
historical facts are forward-looking statements that involve risks and
uncertainties and are subject to change at any time. The Company derives its
forward-looking statements from forecasts which are based upon assumptions about
many important factors such as the relationship of demand and capacity in the
freight market, the performance of finance and insurance markets, prevailing
short-term interest rates, the risks and uncertainties inherent in a start-up
venture, general market conditions and competitive activities. While the
Company believes that its assumptions are reasonable, it cautions that there are
inherent difficulties in predicting the impact of certain factors, which could
cause actual results to differ materially from anticipated results. These
factors, as and when applicable, are discussed in the Company's filings with the
Securities and Exchange Commission, in particular its most recent Form 10-Q.
TRANSFINANCIAL HOLDINGS, INC.
UNAUDITED SUMMARY FINANCIAL STATEMENTS
(in thousands, except per share data)
CONSOLIDATED STATEMENTS OF INCOME
Third Quarter and Nine Months Ended September 30, 1997 and 1996
Third Quarter Nine Months
1997 1996 1997 1996
Operating Revenues.............. $35,208 $30,041 $99,372 $ 83,604
Operating Expenses.............. 34,342 29,332 96,507 82,275
Operating Income................ 866 709 2,865 1,329
Nonoperating Income............. 181 297 611 931
Income Before Income Taxes...... 1,047 1,006 3,476 2,260
Income Tax Provision............ 478 501 1,571 1,040
Net Income...................... $ 569 $ 505 $ 1,905 $ 1,220
Net Income Per Share............ $ 0.09 $ 0.08 $ 0.30 $ 0.18
Average Common Shares Outstanding 6,111 6,609 6,268 6,878
CONSOLIDATED BALANCE SHEETS
09/30/97 12/31/96
ASSETS
Cash and Short-Term Investments. $ 8,535 $18,978
Finance Accounts Receivable, net 16,157 14,554
Freight Accounts Receivable, net 12,540 9,233
Other Current Assets............ 10,781 10,153
Total Current Assets.......... 48,013 52,918
Operating Property, net......... 30,634 23,390
Intangible and Other Assets..... 9,847 10,504
$88,494 $86,812
LIABILITIES AND SHAREHOLDERS' EQUITY
Total Current Liabilities....... $12,260 $11,048
Deferred Income Taxes and
Other Liabilities............. 2,468 1,203
Shareholders' Equity............ 73,586 74,561
$88,494 $86,812
TransFinancial Holdings, Inc., 8245 Nieman Road, Suite 100, Lenexa, Kansas 66214
(913) 859-0055
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
TRANSFINANCIAL HOLDINGS, INC.'S CONSOLIDATED STATEMENT OF INCOME FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 1997 AND CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER
30, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
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